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Is honesty the best policy?

July 1, 2008

How would you like it if your boss’s salary and bonuses depend on whether you think he had been an effective boss?

Its called the 360-degree review. Terrific stuff. If you haven’t heard about it, you can read about it here.

Though its been around for a while, I’ve yet to come across one local management team that likes the idea. “We are Asians, not Westerners,” I’ll hear. “If we don’t act tough against the staff, they will surely walk all over our heads. We wouldn’t want that would we.” Reading between the lines, a) Asians have more ill-will than Westerners, b) Because Asian employees cannot be trusted, employment must be a one-way street.

So popular lore has it that Westerners can do it because they are honest and magnanimous, never mind that these nice people are screwing a whole region’s economy. They are definitely more civilized than we are, never mind that we’ve got 5,000 years of enlightenment versus the West’s 5,000 mostly pagan years. And if you haven’t heard, our employees are really gollums in disguise who will loot and burn down the company given half the chance, never mind that Asians are also one of the more charitable people.

So I present to you what Asian managers have in their heads.It would’ve been funny if it wasn’t so tragic but it turns out that such views are becoming unprofitable. Yes, brain drain. Times have changed. As far as good talents are concerned, money is no longer a privilege but a minium requirement. They are starting to mumble about that which shall not be named: employee satisfaction. They want competent managers! Good culture! Free parking! The freedom to voice opinions! Did I mention free parking! A confused management asks, but where do we draw the line on openness? If we let everyone criticize their bosses, what do we do with a manager that 9-10ths of his staff say is incompetent? Remember, for years we’ve been promoting managers on anything but the ability to manage. Which is something everybody does. Just ask Dilbert.

Seeing that foreigners will never beat us in the kiasu and kiasi department, I ask myself will it boil down to just one question – can we survive criticism? Do we dare let anyone think that maybe we were part of the problem all along? Is it in our character to be brutally honest, not just elder to younger but also younger to elder? Should we allow ourselves to be that honest? And as managers, do we dare let such honesty go unpunished?

What do you think?

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16 Comments leave one →
  1. LC Teh permalink
    July 1, 2008 10:06 am

    I read a story somewhere that in one company they did an all-round feedback on their executives and after they’d computed all their data they wanted to fire one guy. He made the most mistakes and stood worst in inter-company PR by being very truthful with everyone, up or down. But he happened to be the best producer in their marketing dept in terms of profit. In the end, they threw out the feedback system.

    I don’t think it’s in the difference between eastern or western values. It’s still all on the bottom line.

    People have a way of varying their opinions when asked openly in a group or when they are given a questionaire to fill in private. You also get different results when you have questions with ‘yes/no/don’t know’ tick boxes for answers than when you pass out blank forms and have them put in answers to open questions and given time to think. And with time to think, harsh opinions can even get toned down or shelved.

    That’s what I think of all-round feeback. It’s like a G.E. What you get may be a president who starts the next war…

  2. Damien permalink*
    July 1, 2008 2:21 pm

    So if being truthful is treated a mistake, then it speaks volumes about workplace attitudes towards honesty. Throwing out the feedback system does sound a bit like removing workplace democratization in favor of profit. The system in China immediately comes to my mind.

    The hidden question is how far does employee satisfaction influence sustainable profit and would the figures be different in the west than in asia? And there’s a more down-to-earth question. Which move gives a more sustainable bottom line: spending $$ to keep employees happy and production levels optimum or spending the same $$ to replace them as soon as they get pissed? (considering that true replacement cost = recruitment cost + retraining cost + production downtime + penalties due to delayed deliveries + all sorts of things including possible loss thru sabotage.)

  3. LC Teh permalink
    July 1, 2008 5:57 pm

    Truth actually hurts. Only a rare few can take it straight in the face even for the straightforward ‘angmoh’.

    And only a rare few companys are in the game for the long run that they see it worthwhile to ensure emplyoee satisfaction. Western MNCs have their great vision statements, but Asian branches may follow only in principle but not in practice. I think that happens because in the west the profit margin is narrow enough for them to ensure every cent spent is counted otherwise their profits become zero. Whereas on this side of the globe only low-cost labor and overheads churn out the cash. They can afford high employee turnover, hence the couldn’t care less attitude. Except for places like S’pore, Korea & Japan.

    For those companies that have to keep provide annually increasing profit figures to shareholders the major income probably has to come from mergers and take-overs.

    Only from my observations. I’m not exactly sure how big business is run. This is only an engineer’s logic. Somewhat like Dilbert’s.

  4. Damien permalink*
    July 2, 2008 8:22 am

    Truth hurts, how true. That’s why thin-skinned managers don’t tend to make very good managers because of the tendency to get emo over small matters.

    You’ve got some interesting points. The cost of one employee walkout in a factory of 1,000 staff may be small compared to one walkout in a 20-man company. I came across one case where a resignation led to a precipituous situation. A graphic designer suddenly resigned in a tiff with management over a $50 expense claim. It so happens that they were in the middle of a million dollar project where the designer played a key role. When reality hit management and counter offers made, the damage was done – the designer wouldn’t come back (it turned out there was long-standing dissastisfaction among all the staff towards the finance manager which the company had chosen to ignore and the $50 claim sparked a chain reaction). The next day 2 other designers followed suit and resigned, leaving no one in the department. The co. tried outsourcing but it could not satisfy the client. The project ground to a halt and eventually the contract was canceled. So not only did the company save $50 to lose a $1.2 million project, the client gave it to the company the designer joined because they liked his work so much. On top of that, the co. had to spend an additional $20,000 on recruitment costs to fill the 3 vacancies in addition to losing $30,000 in a failed outsourcing attempt. Their bottom line got effed big time.

    Similar cases suggest that the smaller you are, the more important employee satisfaction will be to your success and, in my opinion, the more compelling the case for all-round honesty becomes.

  5. LC Teh permalink
    July 2, 2008 8:47 am

    I think looking at the different cases, it’s quite safe to conclude that management decision is still about which side your butter is on. If your market is more in direct connection with your people, these people are your bread and butter. So you better take care of them. Hard fact of life…

  6. Damien permalink*
    July 2, 2008 9:11 pm

    Exactly.

  7. July 6, 2008 3:58 am

    Hi Damien and Uncle LC,
    Interesting blog entry… especially the date itself. It marked my 1st year anniversary with my Mother Company. I was called back to serve the Mother Company 1 year ago.

    I had a chance to have this conversation with my AGM on Friday, and I thought he gonna be open enough to let me slice him slowly, no, to tell him my truthful feelings about himself.
    He somehow was annoyed or emotionally disturbed, or … well, I can’t find better word to describe that… And it’s only after my opening line, my first line… *smack forehead*

    Apa boleh buat?

  8. LC Teh permalink
    July 6, 2008 11:57 am

    L,
    Mark this off as ‘lessons learned’.
    Also remember, nothing is permanent. Not even CEO appointments. Nobody sticks around forever, especially those who cannot accept the truth about themselves.

  9. July 6, 2008 3:31 pm

    As I always mention, The Good Ones Never Stay, The Bad Ones Never Leave.
    🙂

  10. Damien permalink*
    July 7, 2008 8:07 am

    Hi guys, people in power don’t like to be told of their faults. It disenfranchises people who need open environments to be creative. That’s the main reason why I left the corporate world to be on my own.

  11. LC Teh permalink
    July 7, 2008 9:18 am

    “people in power don’t like to be told of their faults”… – sounds like our political situation here.

    You made the right choice.

  12. Damien permalink*
    July 7, 2008 4:09 pm

    People in power are like parents. They hold all the resources and use it to make you toe the line. When we become parents (I’m still young hehe) we do the same to our kids. Some things in life won’t change I guess.

  13. LC Teh permalink
    July 8, 2008 11:15 am

    I have to disagree with you here.

    Some people in power are like some parents who waste or gamble away their resources, then steal from their kids’ piggy banks to pay for their addictions. Failing that they borrow from loan sharks, finally putting the whole family in grave danger and misery.

    Not all parents use their resources to keep their kids in line. It should be the exception rather than the rule. Same applies to governments.

  14. Damien permalink*
    July 8, 2008 1:17 pm

    Guess I’ll never know these things until I become a parent but putting others in harm’s way to cover one’s addiction brings back some horrible memories. I saw my friend’s family get crushed by debt, caused by the parents who, despite being advised by so many people, still decided to gamble away everything. That memory is the single biggest lesson I’ve kept with me till today.

  15. LC Teh permalink
    July 8, 2008 3:55 pm

    Sad isn’t it? Again it’s like that dumb bug screaming but heading straight for the bright lights.

  16. Damien permalink*
    July 9, 2008 9:21 am

    Yeah, people get attracted to bad spouses, bad jobs, bad friends every day and get burned. For the moth, its funny how survival instincts can actually achieve the opposite result. Could be a lesson there somewhere.

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