Sunday, January 15, 2012

Three Envelopes

While thinking of the President's latest electoral ploy, the new found focus on 'fixing' the government bureaucracy that led him to ask Congress for permission to consolidate 6 trade related departments and agencies into a single entity - reducing headcount by about 1,000 workers and projected savings of about $3 billion a year, I was reminded of a business management analogy....

A new CEO takes over from a CEO who replaced because the company was struggling very badly.  He arrives at his desk to see an envelope on the center of the desk from the previous CEO.  The new CEO opens the envelope and pulls out three smaller envelopes numbered 1, 2, and 3 along with a brief note.

The note wishes the new CEO success in their efforts and that at the first sign of major trouble, to open the first envelope for advice on how to address the problem.

About 4 months later and the new CEO is under fire because the company missed it's last quarterly numbers very badly.  Remembering the envelopes, the CEO gets and opens the first envelope.  In it is a note that says, 'Blame your predecessor' and then says at the next sign of major trouble, open the envelope marked number 2.

The CEO follows the advice and blames his predecessor for all of the companies current problems.  The pressure on the CEO lessens considerably.

A number more months go by, and the company continues to struggle financially.  Profits are down, the stock is down, and shareholders are upset.  The CEO gets the second envelope and opens it.  In it is a note that says 'Reorganize' and says to open the 3rd envelope at the next case of major trouble.

The CEO embarks on a major reorganization effort for the company which takes about 6 months. 

Despite this the company remains in major fiscal trouble and the pressure is beginning to intensify on the CEO.  As the pressure becomes nearly unbearable, the CEO turns to the 3rd envelope.  Opening up the envelope, he reads the simple instruction, "Prepare 3 envelopes".

When faced with trouble, the real character of managers / people can be seen.  Some will freeze and be unable to function.  Others will try to analzye the causes of the problems and find themselves subject to paralysis via analysis - unable to function because they are looking too hard trying to find a cause.  Some may do as the above new CEO do - go through the motions of leadership and management but are not doing more than ultimately buying themselves time for 'something' to happen to fix the problem.

Others will do a little analysis, look at other companies / situations similar to the one being experienced and objectively look at what worked and what didn't work.  They will consider this, try to identify the root problems, even look to outside consultants and expert to help them find the root problems, and then develop / implement the plan to address the root problems.

The latter managers are the rare ones - the one's who are successful.  They might not be the popular ones because often fixing the root problems means taking care of the causes of those problems - the less effective managers or those who operate based on an agenda that has no real foundation in reality.

The politican / managers of an organization are most likely to follow the steps of the 3 envelopes - even if they don't have the three envelopes in front of them.  The problems are not theirs, they are the results of their predecessors.  Then the ongoing problems are the result of the organization and its structure.  Ultimately, though, they cannot avoid not only their accountability and responsibility - but their role in not only not solving the problem, but making the problem worse.

Think now of our government and the Obama Administration.  It's as if President Obama came into the White House, entered the Oval Office, and sitting in the center of his desk was an envelope.

He has, and in many cases, still tries to blame his predecessor for his own problems.

He is implementing a reorganization - not only with his request for 'permission' to consolidate some minor agencies  - but with his new approach to operate via executive fiat and regulations to bypass a Congress that will not give him exactly what he wants.  He's effectively reorganized the Constitution.

This will continue until the American people remind him on November 2012 that it's time to write his own three envelopes.  Until then, the problems will not be addressed because to do so would admit the failure of the architecture of his ideological vision.

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