Enough already! In their recent editions, both Newsweek and Bloomberg Businessweek are vilifying Angela Merkel, chancellor of Germany, for failing to solve the Euro crisis problem. The Newsweek article describes her in particularly unflattering terms, with not-so-subtle Aryan references (“the lady prefers blonds”), a Germanic over-preoccupation with rules and discipline, and an ill-advised focus on inflation rooted in the history of the Weimarer Republik. Bloomberg Businessweek’s article avoids WWII imagery, but similarly describes her as a cold-hearted incompetent leader, hopelessly stuck in a German paradigm of austerity and unable to grasp the new global economic realities.
I have been puzzled by this concentrated journalistic fire on the German chancellor in recent weeks. Why target her, when the euro crisis clearly did not originate with Germany, and when most country leaders are struggling with their response to the new economic challenge? At this stage, everybody is groping in the dark for a viable economic framework (the division of the US leaders on the virtues of tax reduction vs. stimulus spending constitutes exhibit A), so why zero in on Angela Merkel as particularly incompetent in this crowd of fumbling country leaders?
At the risk of inflaming the debate, these two articles seem to me to tap into both anti-German and anti-women-as-leaders sentiment. One way of hiding our own lack of answers is to find a common enemy, and what better enemy could there be than a German one, and a woman at that? The German thing is annoying because it reflects the continuing parochialism of some portion of the US electorate (witness Herman Cain displaying his utter insensitivity to global affairs in the infamous Uzbekistan interview) (link 4) and the willingness to mobilize against a common imaginary enemy, Germany in this most recent development (although China is the most common boogeyman, hello Donald Trump).
While the xenophobic overtone is annoying, I have particular trouble with the woman thing. I find it striking that both articles describe Angela Merkel as left-brained, analytical tendencies (the lady wrote her doctoral thesis on quantum chemistry) and highlight her lack of human warmth (“nobody really gets close to the chancellor”). What would we want Angela to be? A soft flower seeking men’s help in solving her government’s problems? A “don’t cry for me, Argentina” chancellor? Barack Obama is also predominantly left-brained, analytical and professorial, and arguably struggles with generating empathy among his electorate, yet this is not the stuff of magazine covers.
I am particularly troubled by the implicit reference to the lack of femininity of Mrs. Merkel. The unflattering pictures in both articles imply a “she’s not really a woman as we think of women” imagery, which is disturbingly sexist. There have occasionally been unflattering pictures of male leaders in magazines in the past (most recently Mitt Romney on the cover of Time Magazine), but they have not had the same gender-specific quality. Unlike many countries of the world, the US still hasn’t had a woman as its leader (Hillary Clinton came close in her 2008 presidential bid, and she generated some of the same anti-woman sentiment), so we may have to wait until then to see this ugly feature of anti-women-as-leaders sentiment finally fade away.
I became interested in economic affairs by listening to my father’s speculation about where commercial trucks driving up our street in Eastern France came from. As a German teacher in the local public high school, his own finances were protected from any competitiveness consideration, yet he instinctively understood the power of business in creating local wealth for the community. He also taught at a local textile institute and learned through conversations with his students how tough it was for local plants to compete against rising Asian factories. Although the value system at our household was mostly academic – you were either a “good student” or you were not – he marveled at how a few of his “average” students had become local entrepreneurs and created jobs around our home town. He often quoted the example of a local industrial baker who, while not an A student in his German class, had grown to hire hundreds of local people, eventually providing a strong career to one of his sons-in-law. “My job is to help my students export by teaching them German”, he would say. This was the first public-private partnership of my young economic life.
When I hear how confused we have become about what makes an economy tick, I revert back to my belief in “it’s the local economy, stupid”. By now, we’ve all learned that jobs are created by small businesses, who are by definition local. Economic wealth is generated when a few entrepreneurs find local financing to hire qualified local workers trained at local schools, thereby generating income that can be spent in local shops and invested in local houses, thereby allowing local politicians to be popular and get reelected. The process of co-creation through which these people work with each other – the entrepreneurs, the employees, the bankers, the customers, the service providers, the politicians – is a lot more important than the economic policy set by a central government anywhere. Sadly, this is not how economists think, as they arrogantly keep searching for the next policy paradigm.
So why do we spend so much time devising policies about which we’ll never agree – the role of taxes, regulation, economic stimulation, consumption, or interest rates? Instead of fighting fratricide conceptual battles, let us forget about top-down policies such as reducing taxes and lowering regulation, since they have produced the current financial crisis. Ignore the dogmatic belief in stimulating the economy through spending and investment infrastructure, since this Keynesian prescription has pretty consistently failed in the past. Ignore the battle between austerity and economic stimulation that currently divides the world. All represent a bad framing of the economic challenge in the first place.
The role of government should be to provide the platform through which economic agents engage with each other at the local level. What we need is a process, not a policy answer. These entities are largely disjointed today. I dream of empowered local bankers acting as clearing channels between local savings and local lending and investment, rather than acting as anonymous branches in their global bank’s central policy. I dream of high schools that would be attuned to the needs of local businesses (I wish all high school teachers had been as aware of the local economy as my father was!). I dream of local entrepreneurs sponsoring scholarships for smart local kids and maybe personally setting them as entrepreneurs to be, not as a concession to the inevitable social responsibility requirement, but in the hope of breeding the next generation entrepreneurs and benefitting from their success. I dream of local corporations investing in local services and shops to help them develop by recognizing they are needed to provide a high quality of life locally. I dream of financial products that would help professionals develop their clientele and their clients afford their services. I dream of politicians facilitating the process of bringing together the financial managers of public projects, the local chamber of commerce, local talent, and local associations. I dream of engaging all of these people in the transparent development of their town or city and accepting joint responsibility for the achievements of the local economy.
Some industries are leading the way by becoming local again. Large international grocery stores are co-creating with local farmers because of the local food movement and the demands of sustainability. Even banks are attempting to become more local again to beg for the forgiveness of their sins, trying to reinvent the old-fashioned community banking model of yesteryears. The local trend is there for all to see.
Some of these local government processes exist in embryonic fashion – e.g., town meetings — but by and large, nobody has devised the process of local co-creation that would bring those people together. There are missing interactions everywhere, so local economies lie inertly by the side, waiting to be awakened. Government people have not been trained on how to become local economy facilitators and activists. What is needed is a giant government re-skilling process. We might as well start now.
Increasingly, my work starts in a barren, Mad Max-like world of deadened emotions. Why do cops not feel the pain of a woman who’s reporting to them she’s been raped? Why does a bank advisor keep pushing credit cards on a customer already stressed by too much debt? Why does a car salesman use hard-selling tactics when buyers tell them at every opportunity they hate the car buying experience? Why does the head of R&D at a chip-designing firm not care about the rising suicide rate of its engineers pressured by competitive deadlines? Don’t they feel the pain they inflict onto others? Aren’t they made of flesh and blood like the people they inflict this pain onto?
Unavoidably, an exploration of these deeply emotional issues reveals a hyper-rationalization of everybody’s behavior through process. “The process made me do it” is the most common answer. Nested inside the process are the productivity and cost metrics associated with it. Let us look at the neighborhood cop and victim, for example. The neighborhood cop operates within the constraints of a quickly shrinking police budget in most cities of the world, and therefore has to move quickly from victim to victim, making sure that the paperwork will hold in court if the incident results in a court procedure. This becomes the legitimization for the cop’s heartless behavior (“it is in your best interest that we fill in this paperwork right so that your aggressor can be condemned in due time”), which, while true, is not exactly what a rape victim would like to hear immediately after the emotionally shattering episode. When the local police force initiates any kind of lean, quality or reengineering effort in this area, it is likely to be framed as: “how do we make the incident reporting effort more efficient?”
From this moment on, the effort is doomed. The project will start with a map of the reporting process. A visual representation of each step in the process will highlight each “pain point” for the protagonists. Each “pain point” becomes a narrow view of everybody’s experience in that particular process, leading to some lame recommendations such as “we need for the cop to be trained in sensitivity” or “we should give the victim the address of a local rape victim association”.
Instead, the redesign should start with the mutual sharing of their experience by the cop and the victim, and have them co-create new interactions between them that would help both parties, not only in the context of incident reporting, but to make the experience of life more meaningful on both sides. This constitutes the “experience before process” principle. Starting with the experience of these two humans of flesh and blood will take them to dramatically different places, and may involve the connection between them long before and long after the crime, the relationship between the police force and their community, potentially involving the demographic make-up of the police force to resemble the community they supervise, the career path of the cops, and the family and social environment of the victim. Starting from this rich terrain, they will identify together new ways to work together, which may or may not have anything to do with paper work and the crime reporting process.
Particularly key to the “experience before process” principle is the attention paid to the experience of the cop. Reducing the cop’s pain to the narrow process that has been defined will lead to focus on the administrative burden of having to do the paper work (admittedly a real issue), but the real pain may be about carrying too much gear, not trusting the beat cop who is with them, not feeling safe in the neighborhood they patrol, or feeling they will be left on their own if they use their weapon prematurely. Similarly, the victim’s experience is typically reduced to the moment of pain following the crime, while the problems would require tackling everything that preceded the actual rape (was there a pattern?) and everything that will follow (emotional support after the reporting).
In business, we have been so trained in the way of process that we forget business is about the human experience. The key here is to view the cop and the victim as two people who have the power to reinvent their relationship. If we can get these two people to co-create a new relationship in a live workshop, then we can do it between a community of cops and a community of victims, providing we give them the tools to engage with each other and the community-organizing structure to co-develop the best solution for their neighborhood.
And by the way, my own experience is connected to the experience of the people I consult to or teach for. My life became a lot more meaningful when I discovered that formulating my “expert” ideas on optimizing the paperwork in the police incident reporting process was a lot less rewarding than helping cops and victims figure out together how to change their life. My job is now to connect the experience of people together by activating empathy, and I am part of that chain of experience. People are a lot more imaginative when they sense you’re interested in starting from their experience than from analytical picture of the process that throws them together. When people start sharing their experience with each other, they unavoidably come up with new interactions between them, which nearly always represent a better economic model for the organization that houses or serves them. At this intersection between the experiential and the economic lies the miracle of co-creation.
Sometimes, one is overtaken by events. This is what happened to me, producing this long embarrassed silence on my part. Many of you have asked me: did you go and talk to the branch manager at Bank of America (see previous blog entry). The answer is: I did. So what came out of that, you may ask? The answer is: great puzzlement on my part, hence this embarrassed silence for close to a month.
Let me explain. The meeting was confusing to me. The Concord, MA branch manager is a nice lady, but she never understood what I wanted from her. In the first twenty minutes of our conversation, she thought I was a customer who was mad at her for not having been in touch. She thought I was there to complain about poor service and about the fact that nobody had reached out to me in spite of the fact that I had both a personal and a business account at her branch. Yes, there was a bit of truth to that, but this wasn’t my focus. I meant to convey I’m a business activist who wanted her to make more money for the branch by connecting more deeply with the Concord community, and I wanted to offer to help her build that community of people. Blank stares and nervous hands told me she had no idea what I was talking about (admittedly my story could have been better articulated!).
The next twenty minutes, she decided I wanted some money for my favorite cause. She talked about some of the things the bank already does, explained to me they can only support a limited number of local charities. Her quizzical look showed she wanted me to blurt out what my pet nonprofit was, so that she could explain why it fitted or did not fit with the program. Since I was interested in defining a broader community agenda with her, I had no specific request for her, except to engage a broad community of people who would construct that community agenda with her and her staff. I could see she was getting increasingly nervous.
The last twenty minutes, she decided I was a potential customer looking to move some money to her branch and I was asking these awkward questions about how the bank works from the inside. I was just curious to know what sort of people worked at the branch, knowing how connected the experience of employees is with the experience of the people they serve. As an example, I did make some noise that I was disgruntled with the private banking service I am currently using, and she thought my attempt at understanding what made her and her branch people tick was an underhanded way of finding out the service Bank of America could provide me. When your focus is on transactions, it’s not easy to understand how human experiences of employees and customers can be connected differently.
There was no visible warmth in the conversation, except at two moments. The lady I met is clearly a people manager, and she did get a twinkle in her eye when she started describing the team in the branch. For a brief moment there, we were connecting on a personal level. She clearly cares about the people she manages, and my guess is that she must be good at it. The other more personal moment was when she realized I travel all over the world talking about this co-creation stuff (I gave her a copy of a book and an article I had written), and discovered that she would like to travel internationally. I told her that if we role-modeled this community bank co-creation stuff in Concord, MA, I would take her with me on the lecture circuit and we would show the world how it’s done. She smiled …
Of course, one of the main sources of my hesitation on what to do next is that my attempt at enlisting the Concord branch manager in co-creation is totally upstaged by the recent Occupy Wall Street movement over the last month. My ambition to weave new connections between a financial services provider and a local community looks quite lame compared to angry demonstrators targeting banks downtown Boston, New York and lots of big cities around the world. In other words, I may be trying to rearrange the proverbial chairs on the Titanic when huge cracks in the hull are already visible and the water has started gushing inside. I heard Michael Moore say on the Piers Morgan show on CNN that people should go occupy their local Bank of America branch, and his bully pulpit is a lot bigger than mine. Bank of America has also reacted badly to customers wanting to shut down their accounts in protest (link). It may simply be too late to do anything for the Concord branch manager and the CEO of Bank of America…
On Wednesday, September 21, 2011, I shall walk into my local Bank of America branch and save their CEO
The cover of Bloomberg Business Week this week is a red-filtered, haunted photo of Bank of America’s embattled CEO Brian Moynihan, accompanied by the headline: “Can this man save Bank of America?” (http://www.businessweek.com/magazine/can-brian-moynihan-save-bank-of-america-09082011.html).
While preserving the appearance of modern journalism’s objectivity, the article describes him as a largely incompetent leader who got the CEO job because he was one of the few who actually wanted it, somehow surviving because B of A is protected from its own ineptitude by being too big to fail.
I actually like Bank of America and its CEO, and I’ve decided to help them. I do not know my man Bryan or anybody senior at B of A, nor do I have any special relationship with the bank. I’m a regular customer of the local branch (I have a small business and a personal account with them), and I like the idea that they still have a physical building right across the street from my office in Concord, Massachusetts, even though I hardly ever set foot in it. I’m also tired of seeing America bash itself, starting with its President and everybody down the line. The President of the United States has appeared uninterested in grass roots community support outside election periods, so I might as well start with a large bank CEO whom I imagine to be a friendly Irish type from New England . I’ll let you know otherwise if I ever meet him.
I sought refuge in America thirty-six years ago because the French annoyed me with their nasty habit of describing from the side of the pool why everybody in it is drowning from swimming incompetence. I came here because I liked America’s sense of collective purpose, compassion, even naiveté, and God darn it, I’ll do what I can to bring this back. It’ll be (sort of) like America sending healthy vines from California after phylloxera had depleted French vineyards, after originally importing the vines from France in the first place. I now have a mission: I will save Bank of America and its CEO.
So here is what I’ll do. On Wednesday, September 21, 2011, I will leave my office in Concord, Massachusetts, march into the Bank of America branch across the street and ask to see the branch manager (or whomever they let me see). I will offer to become the first customer activist of their branch and propose to mobilize a local community of like-minded customers to help them make their bank better. I’ll do it partly out of self-interest (they’re annoying on so many dimensions, where do I begin?), and partly out of altruism (because I want my branch to be around for many years to come and my man Bryan to be able to feed his wife and three children).
Mostly, I’m curious to know the people inside. I go into the bank two or three times a year, usually when my controller is on vacation and I throw myself at the mercy of the teller employee because I can’t even remember the business account number or locate the business debit card I’m supposed to use. There was even that time when some Brazilian client dumped loads of cash in our mail box for a speaking engagement I had done several weeks earlier, and I had to explain this was not drug money, but a bona fide fee for service. I remember the teller employee having something like a Russian name and accent, and I wanted to know more about her (how did you end up in Concord?; do you have any advice on where to stay?, I’m on my way to a Moscow conference), but we were both too busy figuring out how to deposit the cash on my account without raising unnecessary flags with Homeland Security, or depositing the cash on someone else’s account.
I have lots of ideas on how to get customers back inside the branch and co-create a new relationship with the bank. Why can’t they have a coin changer like TD Bank? I have about thirty pounds of coins I would like to change into real money some time before the universe stops expanding. I hereby pledge I will bring my grandchildren to the branch as soon as I get them and they’re able to count. I could use an extra conference room every now and then for my client meetings, and I’d love to be able to borrow or rent one of their rooms. I’m looking for a CPA in town, and I imagine they might have some CPA customers they could introduce me to (and generate new business for). My kid is a freshman in a business college nearby, and he’ll probably need an internship or a job someday. My wife is heavily involved with a bunch of local associations who also need a place to meet in the evening and have banking needs. The most effective network in town is made of former professional women volunteering their talent for various causes, never engaging with local banks in any way, because nobody at the bank ever reaches out to them.
“This is all fine and dandy”, the branch manager will say (assuming there is one; for all I know, the Russian lady runs the place), “but how are we going to make money from all this community and social stuff?” I will then flash one of my legendary smiles and tell him how to really make money with guys like me. “I know you’ve been trying to CRM me for years. I know your strategy is to identify individuals with some assets to manage, ideally with small (or larger) businesses. Your strategy is to ‘cross-sell’ me. But you don’t even seem to be able to read my account balance and call me when I accumulate some cash to invest. ” We will agree that having me tell them where I keep my money is a more efficient way to find out than have their CRM program try to connect my business account with me as a person. “I’ll help you make money for your branch because I want you to be promoted and Brian to remain your CEO”, I’ll say. “And by the way, I can bring you lots of people like me if you let us shape the branch with you.”
I’ll let you know how I do on Wednesday. Stay tuned. Brian’s survival is at stake.
There’s something inherently risky about living in Red Sox nation and extolling the talent of a former Yankee manager, but I really like Joe Torre. I know, I know. Bear with me here.
What I like about the guy is his practical, self-effacing way of engaging super-egos in the construction of a common ecosystem called baseball. A recent Sports Illustrated article explains how in his latest endeavor, he’s trying to get baseball umpires and players to work together. While everybody is focused on generating new rules ideas, tightening old ones, ruthlessly evaluating umpires and mercilessly punishing players, he believes umpires and players should just get to know each other better. He points to the fact that when the American and National Leagues both had their own umpires, players and umpires were able to know each other and got along better. He’s working on finding a place in training camp where they can sit together. In other words, it’s not about setting end-policies and defining hard paths to those policies. It is about the process of engaging with each other in new ways.
At first blush, his words seem to capture an old-timer’s nostalgic remembrance of a gentler baseball era (Torre is 70 years old). He sounds a bit like Rodney Dangerfield when he talks about “respect”. The article describes his skills set as “communication”, an oft-touted characteristic of older managers.
But Joe is something much more modern than that: he is the Mark Zuckerberg of baseball. He has repeatedly proven able to structure a constructive dialogue between baseball constituencies, no matter how difficult they are (remember George Steinbrenner?). He’s created winning models wherever he’s been (regrettably, the Yankees most notoriously among them). In co-creation terms, he is an engagement platform all by himself, continuously structuring new forms of interaction between warring factions, and enabling them to find new ways to create value together. His modesty and abnegation are his currency, the success of others his reward (but ultimately also his own).
As my friend and colleague Venkat Ramaswamy likes to say, he’s the opposite of the Field of Dreams. With him, it’s no longer: “if you build it, they will come.” It is: “if you build it with them, they’re already there”.
I am back from a week of vacation in London. Do I know how to pick a vacation spot or what?
From my room in a posh Mayfair hotel, I started wondering how the civilized society of the UK could suddenly produce those horrendous riots. While professional criminals clearly participated, the transformation of previously law-abiding citizens into one-time looters and arsonists is most intriguing. Why would a 32 year old assistant teacher coaching high-school youths become an accidental looter? Why would a recently graduated 22 year old student living a nice suburban life with her parents steal an HD television when she already has one at home, only to be consumed by remorse and turn herself in a few days later? What went on in the minds of those ordinary, law-abiding citizens and made them into wolves for one night?
One way to look at the problem is to view it as an epidemic, like tuberculosis, cholera or AIDS. Gary Sulkin, a well-known epidemiologist, urges UK authorities to look at it in this fashion in a recent article in the Guardian. His view is that containing or stopping the infection requires interrupting the person-to-person spreading of it. A cognitive psychologist named Aaron Beck refers to the phenomenon as “groupness” and describes it as a collective, communal, group-think-motivated violence. Having been confronted with violent hazing in my youth, I have wondered all my life why some of the individuals who later became my friends (well, sort of) did not do anything to stop it at the time. What would it have taken for one of them, then another, to say: “I shall not do this.” Having lain awake many nights pondering this issue, I am not sure hoping to tackle the issue at the individual level yields any answer. Sometimes, only a group can counteract the destructive actions of another group.
Riots are a perverse form of co-creation, more like partial co-creation, which ultimately is no co-creation at all. Riots have many ingredients of true co-creation. Rioters create value for themselves through a group process, generating both objective benefits for themselves (value of stolen goods), and emotional ones (exhilaration of watching a neighborhood go ablaze, sense of unbridled power). They use virtual engagement platforms (social media to congregate effectively and outguess police forces), and live events (rioting in the streets, targeting specific stores). The engagement process has proven self-sustaining and expansive, as the movement was able to spread quickly not only across London neighborhoods, but also across cities (Birmingham, Manchester). On the other hand, however, riots fail the true test of co-creation, which is to create value for all parties. Riots destroy massive amounts of value for looted store owners, homeowners and tenants, and raise the cost of security, not to say anything of the experiential trauma of police and citizens getting hurt or killed.
The art of true co-creation is to find the missing interactions. It seems to me the interaction between police and neighborhoods is particularly important, and this may be one London’s opportunity. Police and neighborhoods sometimes interact co-creatively, and sometimes they don’t. In Los Angeles, Bill Bratton transformed the Los Angeles Police Department, after doing the same in New York and in Boston. His concept is that police authorities must measure results at the granular level (precinct by precinct). Small crimes do matter because they lead to bigger ones (this is the so-called “broken windows” theory). Police forces must reflect the demographics of their neighborhood. The Los Angeles police was too white for too long, causing massive distrust with the population, and now reflects the societal make-up of the city’s inhabitants. As a result, crime is dramatically down, and citizens rate the LAPD much higher than they used to. This follows the successful pattern of co-creation I have observed for any large organization: first co-create inside (police forces), then export the co-creative mobilization to external stakeholders (the public at large).
Bill Bratton has now been tapped by David Cameron, the UK prime minister, to help with the riots aftermath. I happen to know Bill Bratton for having once done a conference with him in Baltimore (this was the best-guarded conference I‘ve ever participated in: 50% of the audience were cops in uniform). I have two specific recollections of a private conversation we had. First, he casually mentioned he is best in the world as what he does (strangely, it did not feel immodest, and may very well be true). Second, as we sat in the lobby of one of the waterfront hotels in the recently renovated downtown Baltimore, he casually explained that the city center we were sitting in was surrounded by ghettos which, less than a mile in all three directions, would one day erupt and destroy Baltimore if the city did not start changing its relationship to those neighborhoods. These words were both ominous, as few people understood the explosive nature of the underlying social issues at the time, and full of hope, in that Bratton had developed a model of co-creative police interaction with neighborhoods.
Bratton was head of the LAPD at the time, and the jury was very much out on whether he could reproduce in Los Angeles what he had achieved in Boston and New York. L.A. is such a spread-out city that many feared his city block by city block approach would be too manpower-intensive to work (I remember Bratton himself expressing some concern about the magnitude of the challenge, an unexpected moment of self-reflection). In the end, he clearly succeeded. My money is on him for London.
Being an economic junkie, nothing excites me more than the view of building cranes, ready-mix concrete trucks clogging major arteries, gleaming steel plants, and hurried business people packing airport food joints and flights. So when I get tired of the American and European debate on why neither continent is growing, I head to Brazil for a fix, which is what I did last week. I came back with a cold (it’s winter time in Brazil) and a treasure trove of new insights on the role of business in generating economic growth.
I was particularly amazed by my stay in Porto Alegre, the largest city in the most Southern Brazilian state, Rio Grande do Sul. Porto Alegre is best known for its beautiful women (Gisele Bündchen was born there), but its economic vibrancy is deserving of at least equal attention. I wish I could take low-energy managers of US corporations and members of our dysfunctional US Congress to see how the various parties of Brazilian society build their growth agenda together. Porto Alegre is arguably the co-creation capital of the world, because it brings together enlightened corporate management of individual businesses, a visionary business confederation of industries, and city, state and federal management.
Corporations are the heart of the Brazilian economic system. I participated in a session with the management team of Hospital Moinhos de Vento (literally the Windmills Hospital, also the name of one of Porto Alegre’s neighborhoods). One of the greatest joys of business educators is to see companies achieve great results and tell their stories, improbably giving us credit for having provided some conceptual structure for their tremendous accomplishments. The two leaders of the hospital told stories of doctors in the neonatal ward developing a new awareness of the mother’s emotional experience, or of nurses catering to the patient’s family needs when major diseases such as cancer strike. They described unemployed poor people receiving an education provided by the staff, so that they could become the construction crew for the new hospital, or develop into nurses that vaccinate rural populations, traveling through the pampas on shiny new motorcycles. Beyond the human aspect, the leaders of the hospital were also able to describe how they had doubled occupancy and revenues for the hospital, with profits to boot. I could not help but notice how easily they moved back and forth between the inspiring experiential nature of what they had created, and the economic wealth they had generated for the business.
The leaders of Hospital Moinhos de Vento are not that different from health care executives I meet in the US or Europe (most are equally attentive to the human experience), but they differ on one essential dimension: they believe their business can make a difference at the societal level and therefore refuse to think of themselves as mere corporate care-takers. They’re not solely focused on reimbursement schemes and regulatory negotiations. They role-model what a corporate hospital can do and proactively teach government leaders what can be achieved through private-public partnerships. They want to be actors in a larger societal play, and they view their business as the backbone of an economic ecosystem that helps them personally fulfill their higher, quasi-spiritual aspiration. While many American and European business people have given up on the societal role of business, they firmly believe this is their mission.
Challenged by this corporate vibrancy, the government is responding in kind, reaching for new modes of interaction with business and citizens. In Porto Alegre, citizens are able to propose projects at the grassroots level and debate why these projects are selected or rejected. For the projects that have been selected, they can track and influence progress. The state itself has devised an elaborate multi-stakeholder planning system that engages all constituencies in a live co-creation process. The federal government of Brazil is also experimenting with new co-creative approaches involving industry and the various states.
Of course, Brazil is far from perfect on many dimensions, facing multiple issues such as public corruption, street crime, and some resurgence of inflation. But when it comes to developing the future model of business-government relationship to foster economic growth, my money is on Brazil. Maybe we should all spend a few days a year in Porto Alegre, even if Gisele Bündchen no longer lives there.
It is winter time in Argentina. In the course of my three-day visit for an HSM conference, I will discover this is physically and figuratively true. The young woman charged by the conference organizer to shepherd me through the event has the sadness of Argentina in her eyes. She’s sharp as a tack, is curious about everything she can learn from me, and knows her job prospects are bleak. She wants to know all about the US and whether she would still be living at home if she were going to a US college. She dreams of green campuses and independence.
Argentina is like its soccer teams, brilliant and ultimately self-destructive. At every international soccer event, Argentina is one of the favorites, expected to combine creative play and game toughness to challenge the best. Year after year, they disappoint. This week, the news is dominated by the relegation of River Plate, one of the two leading club teams of Buenos Aires, who will have to play in a second-division league for the first time in its 110-year history, creating talks of bankruptcy for the club. For good measure, giant riots erupted after their last match around the Monumental stadium where they play, and more than 70 people were hurt.
I am coached not to mention River Plate’s fate on any of my speeches. Emotions are still raw. On the way to the airport last night, I catch from the road a glimpse of the Argentine national team starting its training for the Copa America tournament. Maybe this time…
At the conference itself, as well as during journalist interviews and company visits, there is strong interest in co-creation. Argentines love the notion that business is about people – there is an instinctive humanity you can feel anywhere in Argentina – and they know for not being very good at it that business is about building ecosystems. For a fleeting moment, it feels like hope.
In the evening, though, gloominess returns during a dinner I am attending with some business executives of Buenos Aires. The conversation starts with agriculture, where exorbitant export duties and the vagary of the government’s granting of export licenses are challenging a highly competitive intrinsic global position. In the oil sector, YPF, a very competent exploration and production and refining company, has been a political football for many years, moving from independence to being acquired by the Spanish company Repsol, to being sold again in a complex government scheme. There seems to be little love between the business community and the current government. Inflation has returned with a vengeance, with economists estimating it at 25-30% (the number is highly contested), but this does not seem to worry the government of Cristina Kirchner, widow of the previous President. Everywhere you turn, there is little hope for growth.
The remarkable thing about Argentines is that while few of their institutions work, they remain a nation of remarkable talent, giving their society a soulful dimension which touches your heart. Leonard Cohen’s Beautiful Losers novel comes to mind. “Don’t worry about us, we’ll be all right,” one of the executives tells me, probably reacting to my empathetic look. “We’re used to this. We’ve learned to cope.” A minute later, though, he starts dreaming of Argentina adopting the Brazilian growth model.
“It would be fun to start growing like them,” he says. “But beating them in the final of the Copa America in a few weeks would be even better.”
The dark side of co-creation: Lance Armstrong, Dominique Strauss-Kahn, and their country’s press corps
Lance Armstrong and Dominique Strauss-Kahn have long shared a common ability: both have parlayed their extraordinary talent into a relationship with the national press corps that has protected them from seeing their dubious ethical behavior exposed (at the minimum) or from being held accountable for their alleged crimes (at worst). It took many years and a recent CBS “60 Minutes” interview of one of Lance Armstrong’s team members on the Tour de France for the American press to finally realize what had been a fairly obvious reality to many observers of professional bicycling, namely that most professional cyclists, including Armstrong, have used performance-enhancing drugs for years. Similarly, Dominique Strauss-Kahn, the former head of the International Monetary Fund and ex-future President of France, was known to have behaved inappropriately with women for many years, with a suspicion of at least one outright rape attempt. Yet the French press corps had created a kind of omerta around him until he was recently arrested in a New York hotel for attempted rape. Why this journalistic conspiracy of silence for the two men in their respective countries?
As a humble student of communities of all types, I believe there is merit in studying even destructive communities. Journalists are an essential ingredient in a democracy. By exposing the secrets of rich and powerful people, they are supposed to “keep them honest,” as CNN advertises the late-night program of one of its journalists, Anderson Cooper. In the cases of Lance Armstrong and Dominique Strauss-Kahn, though, journalists became co-dependent with the subject they were supposed to cover. Instead of investigating the objectionable activities or crimes of their global sports or political star, they moved into a pattern of silence. This is the dark side of co-creation, and it behooves us to find out how such a negative form of co-creation develops.
For Lance Armstrong, American journalists seem to have wanted to believe the fairy tale: the inspiring story of Lance overcoming cancer, Lance becoming a global star in a sport traditionally dominated by Europeans, Lance mobilizing huge resources for a great cause with his cancer foundation. As a result, they deliberately ignored the growing evidence pointing to Lance’s doping, including some high-quality investigative journalism done by the French sports daily L’Equipe. Somehow, the US sports journalism community seems to have coalesced around a collective belief that accusations of Lance’s doping in the French press were the result of sour grapes because Lance had stolen the limelight from French cyclists in a major French sport. Instead of collectively rallying around this orthodoxy, wouldn’t their job have been to investigate these claims? Why didn’t they? Where were the Woodward and Bernstein of American sports journalism? Why weren’t they running around asking Lance’s team members, nurses, team managers, doctors, mechanics, hotel keepers, anti-doping authorities, and law enforcement officials about what they had observed? How could they miss a story with so many protagonists and involving so many daily interactions with prohibited products?
The Dominique Strauss-Kahn (DSK) story is equally troubling. Like many other people who occasionally travel in French power circles, I had heard stories of DSK’s womanizing behavior for years, including some rumors of outright predatory behavior. French people profess to be amused by the peccadilloes of their political and corporate leaders (but hopefully not their crimes!). They often blame the American investigation of inappropriate sexual behavior by powerful people on American puritanical tendencies, conveniently ignoring that these investigations often point to human weaknesses that degrade leaders’ ability to lead, or make them vulnerable to corrupt behavior to protect their shameful secrets. When US politicians are suspected of inappropriate behavior, a pack of journalistic hounds gets unleashed in quest of a scoop, and editors rejoice over the possibility of a page one exclusive on the topic. By and large, France does not have a tradition of investigative journalism, which represents a gaping hole for a democratic country of its size and importance on the international scene.
Even more worrisome is the lack of willingness on the part of French journalists to take on the country’s political and corporate leaders. The co-dependency that exists between journalists and French leaders is palpable. French power circles frequently interfere with journalistic independence and utilize access as a blunt instrument, and there have been numerous stories of phone calls being placed in strategic places to de-fang ambitious journalists who tried to practice American-style journalism. The sad thing is that intimidation of this kind has largely neutered the French press, producing more and more daring behavior by some of its leaders. I fear that DSK’s behavior at the New York Sofitel will turn out to be but the ugly head of a larger beast.
The greatest perversion arising from this lack of transparency about the reprehensible behavior of French leaders is that women who have been victims of these behaviors have understandably refrained from speaking out, thereby allowing these horrendous behaviors to continue unchecked, and exposing more women to these predators. Why haven’t Le Monde, Le Figaro, or the major French TV and radio channels interviewed the women who have described DSK’s inappropriate behavior? Why haven’t they spoken to IMF employees, hotel front desk employees, members of DSK’s Socialist Party, or staff members at Socialist Party conventions? Why did news editors not encourage their journalists to follow up on the rumors?
There is no co-creation without transparency. Both the Lance Armstrong and DSK stories are illustrations of the fact that co-dependency can develop in the dark alleys of power. Journalists operate in a difficult economic world, with advertising revenues, circulations of major newspapers, and television audiences at major news networks all down. Finding the courage to take on the Lance Armstrongs and DSKs of this world and reinvigorating the old-fashioned investigative journalism tradition may be the profession’s best hope.
