I was wondering the other day whether CEOs and boards were paying too much attention to what was measurable and not enough to what mattered. As companies increasingly focused on complex financial instruments and sub-prime fast money, leaders seemed to have lost sight of what mattered. If boards spent more of their time asking questions such as how the company’s values were being followed each day and whether customers were satisfied enough, perhaps we would not be in the economic mess we are in now. Imagine how businesses might run if the bottom line was core values and net promoter scores (would you recommend this company to someone else). At least corporate responsibility is now part of the triple bottom line (economic, social and environmental).
As I was thinking about this blog post, I came across an interview by Maria Bartiromo who has a BusinessWeek column. She interviewed former Time Warner CEO Jerry Levin. Bartiromo was asking Levin about lessons learned since being the maestro behind the failed Time Warner-AOL merger. Levin says:
“First of all, I think I realize now that there was a rather parochial zone of interest where all of my relationships—maybe even my relationship with myself plus or minus—were based on Time Warner’s destiny. If something didn’t touch on any of the businesses of Time Warner, then I didn’t have any interest. The other thing is: There wasn’t a sufficient understanding that it’s O.K. to be open and vulnerable, to ask for help. To state it in different terms, it’s probably helpful to invoke the feminine principle and be compassionate, empathetic, understanding, give respect to everybody, don’t get deluded by the natural hierarchy. And don’t get too self-satisfied that you have all the answers.
I believe the importance of the capitalist system, the way it’s been structured. But there is such a focus on delivering those returns almost without any understanding that there are deeper issues that management is also about—humanism and respect for people in the company; serving the public interest; higher obligations to yourself and to the world. Very few mission statements take that into account.”
Levin helps me make my point. Maybe we need to figure out how to focus on what matters in addition to or (at least equally to) what we measure.
