Donald Burkins's List: Leadership & Organizations

"Markets discipline producers by rewarding them with profits when they create value for consumers and punishing them with losses when they fail to create enough value for consumers. The disciplinarians are the consumers. The market for corporate control is no different in principle. It disciplines the managers of corporations with publicly traded stock to act in the best interests of shareholders. Here the disciplinarians are shareholders.

Firms whose share prices are lower than they could be if managed by more talented or highly motivated managers are attractive takeover targets. By buying up enough shares to vote in a new board of directors, a bidder can then replace an inefficient or ineffectual management team. The bidder profits when the new management team gets results, which come in the form of improved corporate performance, higher profits, and, ultimately, higher share prices."

"When companies focus on pleasing customers, rather than just shareholders, everybody can win. Just ask Apple, Procter & Gamble, and Johnson & Johnson. (Aly Song/Reuters)

In the recent history of management ideas, few have had a more profound — or pernicious — effect than the one that says corporations should be run in a manner that “maximizes shareholder value.”

Indeed, you could argue that much of what Americans perceive to be wrong with the economy these days — the slow growth and rising inequality; the recurring scandals; the wild swings from boom to bust; the inadequate investment in R&D, worker training and public goods — has its roots in this ideology.

The funny thing is that this supposed imperative to “maximize” a company’s share price has no foundation in history or in law. Nor is there any empirical evidence that it makes the economy or the society better off. What began in the 1970s and ’80s as a useful corrective to self-satisfied managerial mediocrity has become a corrupting, self-interested dogma peddled by finance professors, money managers and over-compensated corporate executives.

Let’s start with some history.

The earliest American corporations were generally chartered for public purposes, such as building canals or transit systems, and well into the 1960s were widely viewed as owing something in return to a society that provided them with legal protections and an economic ecosystem in which to grow and thrive. In 1953, carmaker Charlie Wilson famously spoke for a generation of chief executives about the link between business and the larger society when he told a Senate committee that “what is good for the country is good for General Motors, and vice versa.”

There are no statutes that put the shareholder at the top of the corporate priority list. In most states, corporations can be formed for any lawful purpose. Cornell University law professor Lynn Stout has been looking for years for a corporate charter that even mentions maximizing profits or share price. She hasn’t found one.

Nor does the law require, as many believe, that executives and directors owe a special fiduciary duty to shareholders. The fiduciary duty, in fact, is owed simply to the corporation, which is owned by no one, just as you and I are owned by no one — we are all “persons” in the eyes of the law. Shareholders, however, have a contractual claim to the “residual value” of the corporation once all its other obligations have been satisfied — and even then directors are given wide latitude to make whatever use of that residual value they choose, as long they’re not stealing it for themselves.

It is true that only shareholders have the power to select a corporation’s directors. But it requires the peculiar imagination of a corporate lawyer to leap from that to a broad mandate that those directors have a duty to put the interests of shareholders above all others."

In January 2010, Roger Martin wrote in Harvard Business Review that we are passing from an age of shareholder capitalism to customer capitalism.

In November 2011, when I wrote critically in Forbes.com about the theory of maximizing shareholder value, the article attracted almost half a million pageviews.

In May 2012, Professor Lynn Stout, the Distinguished Professor of Corporate & Business Law at Cornell University Law School, published her book, The Shareholder Value Myth, showing that the shareholder value theory has no basis in law or policy.

In August 2012, the New York Times headline was “Down With Shareholder Value”, as Joe Nocera declared: “It feels as if we are at the dawn of a new movement — one aimed at overturning the hegemony of shareholder value.”

In July 2013, the Financial Times had a series of articles chiding business schools for still teaching what even Jack Welch has called the “world’s dumbest ideas”.

Now in September 2013, the Washington Post has joined the chorus of critics and published an article by Steven Pearlstein entitled, “How the cult of shareholder value wrecked American business”.

"Delivery is both an art and a science. We think the art is in the innovation and adaptability of the actors and different delivery models, while the science lies in replicating and scaling those models."

If we fail so regularly at predicting the future, then what's the point of planning for it?

"We work with governments and agencies to develop the strategies and capabilities needed to address the leadership challenges that matter most. By drawing on our public, private and social sector experience, we work to enhance the effectiveness and efficiency of government institutions, enabling them to better fulfill their mission to the public."

"Leadership is not merely about success. Abraham Lincoln and Martin Luther King were great leaders, not because they were successful within their different worlds, or even because they were successful despite the constraints of their worlds. They were great leaders because they transformed their worlds."

"ICF Core Competencies
The following eleven core coaching competencies were developed to support greater understanding about the skills and approaches used within today's coaching profession as defined by the ICF. They will also support you in calibrating the level of alignment between the coach-specific training expected and the training you have experienced. "

"The Centers for Disease Control and Prevention (CDC) implemented the Diffusion of Effective Behavioral Interventions Project to disseminate evidence-based behavioral interventions to community-based HIV prevention providers. Through development of intervention-specific technical assistance guides and provision of face-to-face, telephone, and e-mail technical assistance, a range of capacity-building issues were identified. These issues were linked to a proposed agency capacity model for implementing an evidence-based intervention. The model has six domains: organizational environment, governance, and programmatic infrastructure; workforce and professional development; resources and support; motivational forces and readiness; learning from experience; and adjusting to the external environment. We think this model could be used to implement evidence-based interventions by facilitating the selection of best-prepared agencies and by identifying critical areas of capacity building. The model will help us establish a framework for informing future program announcements and predecisional site visit assessments, and in developing an instrument for assessing agency capacity to implement evidence-based interventions."

"As a major event during IBM's centennial year, THINK: A Forum on the Future of Leadership brought together leaders from government, business, academia and science, along with an audience of up-and-coming leaders from across the globe, to deepen our collective understanding of the keys to success on a smarter planet."

"Donald Schon made a remarkable contribution to our understanding of the theory and practice of learning. His innovative thinking around notions such as ‘the learning society’, ‘double-loop learning’ and ‘reflection-in-action’ has become part of the language of education. We explore his work and some of the key themes that emerge. What assessment can we make now?
contents: introduction · donald schon · public and private learning and the learning society · double-loop learning · the reflective practitioner – reflection-in- and –on-action · conclusion · further reading and references · links · how to cite this article"

"In the 30 years since the publication of In Search of Excellence, I've given 2,500+ presentations on organizational and personal excellence. For the last two+ years I've been pulling those 30 years of materials together. Throughout 2012, we will release, one part every two weeks, essentially “the best of”—a heavily annotated, 23-part mega-“presentation” titled “Excellence. Now.” This video gives you a preview. Use this material as you wish and please “steal” all you want! "

"Another unnecessary website…

Judith Faust

Useful perhaps for my students… Of minor interest to friends and family… Beyond that, just another bit of debris in cyberspace.

A better metaphor: In the centuries before the last, girls made samplers to practice their embroidery stitches. For adept young needleworkers, the sampler was a showcase of skill. The best one I ever saw, though, was the work of a reluctant and, I imagine, unhappy embroiderer. The cloth was grubby. The satin and daisy stitches crumpled it into knobs. There were knots on the front and dangling ends. No two chain stitches were the same size, and the design was unfinished. Her frustration, her desperate longing to be anywhere but there in the parlor, under the disapproving eye of a mother or a great aunt, with a sharp and a tangle of thread in her hand, were as plain in her sampler as the lopsided letters of her name.

This web page is my sampler, my first effort to learn the stitches of site design. I'm not as unhappy about it as she was, but I think of her as I wrestle with how to format text within the awkward limitations of HTML."

"A very short workshop for fundraising professionals
Thursday, August 21, 2003

Presented by Judith Faust
Instructor, School of Social Work
University of Arkansas at Little Rock
jkfaust@ualr.edu • http://www.ualr.edu/~jkfaust
o) 501/569-8461 • h) 501/376-6704"

"Strategic planning deals with the futurity of present decisions

"Traditional planning asks, 'What is most likely to happen?'. Planning for uncertainty asks, 'What has already happened that will create the future?'.

Strategic planning is not a box of tricks, a bundle of techniques. It is analytical thinking and commitment of resources to action. It is the continuous process of making present entrepreneurial decisions systematically and with the greatest knowledge of their futurity, organizing systematically the efforts needed to carry out these decisions, and measuring the results of these decisions against the expectations through organized, systematic feedback. The question that faces the strategic decision-maker is not what his organization should do tomorrow. It is: 'What do we have to do today to be ready for an uncertain tomorrow?'. The question is not what will happen in the future. It is: 'What futurity do we have to build into our present thinking and doing, what time spans do we have to consider, and how do we use this information to make a rational decision now?'".

- Peter Drucker"

5 articles by Harry Kelber, long-time labor activist and editor of The Labor Educator. I've been guided to this site by Ralph Nader.

"As a recap,
Part 1
described the
overall process
of
preparing for a strategic plan and the other key outputs of a strategic planning
session.
Part 2
covered the
tools and techniques

commonly utilized in the process. This time, I'll talk about why you might want
to use an
outside facilitator
for your next planning session
and what
qualities you should look for
if you do decide to
bring in such a person."

On the benefits of participation in strategic planning as a developmental experience; authentic learning experiences; developing strategic thinking skills

"Strategic thinkers:
Are systems-oriented; that is they think holistically and use the helicopter view.
Embrace creativity, innovation, intuition, and understand the insight process (Eureka and aha!)
Think futuristically and embrace visionary thinking
Act like organisational radars (or antennae) scanning the internal and external environments
Have a worldly mindset
Act as explorers, with heightened curiosity and alertness
Have the ability to keep an open mind to new ideas, and adapt to changing environments
Have the desire and guts to outwit, beat, and out-run competition
Are knowledgeable of their industry and experts in their areas of specialisation
Know their finance and risk management
Have a bit of entrepreneurial spirit
Are good communicators (good at asking probing questions and listening)
Know how to inspire and lead teams.