Leveraging OPE (other people’s energy) for fame and fortune: The captain and his ship.
Watching the Royal Commission into banking unfold, it was a bit of a poignant moment watching the CEO of AMP fall on his sword.
Not that I have a shred of sympathy for financial planners ripping off their clients – absolutely none. The whole industry gives me the craps.
But there was a moment where I realised that, as CEOs, we share a similar fate. If the ship is sinking, we go down with it. If someone needs to take a fall, it has to be us.
For the media its black and white. He allowed financial planners to rip off their clients. He covered it up to the regulators.
But I’m worldly enough to know that there could be some shades of grey in there. It’s unrealistic to think that a CEO has full knowledge of everything that every one of their staff are doing.
It’s also unrealistic to think a CEO can totally change a corporate culture, no more than a Prime Minister can influence the culture of their country. I can allow space for the idea that Craig Meller just inherited a dodgy corporate culture – one that might take decades to change. Maybe, just maybe, he was a good apple in a rotten barrel.
Probably not, but we’ll never know for sure.
But at the end of the day, the CEO has to take the fall. It’s the only way. It’s a foundational rule of leadership.
You cannot ask the people who follow you to do something you wouldn’t do yourself.
But hang on. We can kind of get the idea of this, but what about the army general who’s asking his men to fight on the front-line and possibly die?
The general is not putting himself in the firing line.
Some generals were despised by their men, but many were loved with fierce devotion.
The key thing is that there has to be an equivalence of commitment. There has to be an equivalent amount of skin in the game.
So the soldiers need to know that the general is as invested as they are. They can live with different risk profiles, so long as he’s giving as much of himself to the task as they are.
The soldiers give themselves to the battle. The general gives himself to the war.
And so if there’s a problem with certain divisions, staff can take the hit. But if the problem is with the whole organisation, then the CEO has to take the fall.
If the CEO tried to pass the buck, their staff would feel that they didn’t have the same skin in the game.
That breeds resentment. That breeds difficult-to-lead-ness.
So if you want to inspire people to follow you, you need to lead with your commitment. Put your skin in the game.
And be willing to go down with the ship.