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Pathways to reform: Economic recovery will rest increasingly on new levels of mutuality and tolerance

In Uncategorized on June 23, 2020 at 2:31 pm

ON the morning of 26th July 1945 Britain woke up to the results of the General Election. The Daily Mail newspaper warned the Labour Party to ‘accept an adverse verdict like men and not like spoilt children’. As the day wore on it became clear the Conservative Party were in trouble. Duncan Sandys, Winston Churchill’s son-in-law, and wartime Minister of Works lost his seat in Parliament; so too Churchill’s son, Randolph, turfed out of his Preston constituency. By 7 p.m. Labour had gained 225 seats, up from 165 to 390. At No. 10, as Churchill packed his cigars away, apparently in ‘good grace’, underlying concerns rumbled: could the new Prime Minister, Clement Attlee, stand up to Stalin?

Leo McKinstry’s study of Churchill and Attlee’s wartime partnership reckons that it survived because it was “partly a reflection of Churchill’s greatness and partly of Attlee’s patience”. Churchill would be known to pontificate: “Well, gentlemen, I think we can all agree on this course,” with Attlee responding: “You know, prime minister, a monologue by you does not necessarily spell agreement.”

1st February 2016. The start of the American primary season. Donald Trump had as yet no support from major Republican backers. From nowhere Trump started to win: New Hampshire, then South Carolina. The endorsements grew. No-one was more terrified of these events than the Republican Party itself. The senior guard fired off warnings, only to end in damp squibs.

Any student of American politics knows that when the campaign trail commences political issues get thrown overboard. For America is the land of ‘reaching out’ for ‘consensus’. Its main chambers are curved with opposing parties effectively shoulder to shoulder. They face the Speaker, unlike the adversarial House of Commons where opponents are two sword lengths apart. Just enough thinking time before delivering a fatal blow. The discomfit we feel about British political life is the shift from statecraft to US-style cheer-leading. Dominic Cummings is in the mould of the professional campaign manager whose focus is ‘authoritarian alignment’. Here is the failure to gate-keep both US and UK political systems.

Rome’s ancient Forum complex: The model for every town centre in the UK. The institutions of state gather round an open space where they are intended to echo ‘the voice of the people’. Or as they used to say in Rome on a Friday night: “Nec audiendi qui solent dicere, Vox populi, vox Dei, quum tumultuositas vulgi semper insaniae proxima sit.” Meaning: ‘And those people should not be listened to who keep saying the voice of the people is the voice of God, since the riotousness of the crowd is always very close to madness!’ The elections of ’45 and ’16 reveal a ‘mass society’ struggling to voice its desire for a new social order.

Both 1945 and 2016 reveal the tendency for underlying human affections to remain hidden from view. No amount of punditry or prophecy can predict. But more critically little of the surface events of the election circus dent the institutional layers beneath. For western democratic institutions do ‘know’ in an almost biblical fashion ‘their people’; as they are in fact ‘the people’. Dedicated citizenry run the machinery of nation states but no journalist is going to write about the boiling intrigue within the finance function of St Godric’s Borough Council. Virtually all our media attention is directed towards agents who have little genuine power.  

Paradoxically the core of Western democracy is its ‘separation of power’: this is the style of architecture that bogs down political charisma in protracted committee room processes. As intended. This truism ties nations like Britain and the US into the same category. What separates us quite violently is the social landscape.

As a grandee of American literature and even greater political polemicist, plus darling of the liberal intellectuals, Gore Vidal, points out: ‘Empires absorb energy, they give out energy, but when they’re over they are like a cold dead mackerel at 5 a.m. in the morning’. Europe after WWII is by comparison to the US a collection of dead mackerels with nearly all its hopeful attention turned towards the supercharged American landscape for inspiration. With US soft power reaching far beyond the gunboats of the British Empire, it proved more effective at drawing people groups towards change.

Currently what the Trump presidency is doing is offering a portent of America as a ‘dead fish society’. And what we Europeans are wondering is what state will its institutions be in after their world dominance reduces. As up for grabs is America’s core notion of freedom, one that was written into its founding documents. This is of little value if their institutions cease to function due to a hobbling of essential components: that of mutuality and moderation. For Western democracy is rooted in a level of civility and shared purpose that defies easy recognition.

After Attlee’s victory the new consensus is as striking now as then. Clapping for the NHS revealed the durable goodwill of the British people to suspend the Brexit divide and collectively support  what remains a British Project. That of the British socialist/capitalist hybrid of welfarism and market forces. To sustain this requires ongoing post-war mutuality of the voting public. On the day of Attlee’s victory a docker in the East End of London carried a placard with the words: “This is the hour of triumph for the common man”. Few at the time had read common woman’s true intent but the social shift was profound.

What remains unexplored is the new emerging mutuality post Recession 2020. Although we don’t know it publicly we are about to re-negotiate the social contract, whether we like it or not. What WWII illustrated was the preparedness to fight for our version of civilisation. It was not a foregone conclusion as no-one knew that an isolationist America would get involved in what was another European war. There is of course no special relationship between Britain and America. It is a ruse for public consumption. Roosevelt regarded the Europeans as leaving the ‘stench of Empire’ wherever they set foot. Plus he wanted in on Britain’s imperial markets. Which we effectively gifted away early on in WWII.

The rapid collapse of colonialism left a huge vacuum. The only possibility to fill this gaping hole was newly minted liberal democratic systems. The NHS being a shining and more obvious institutional symbol. What makes the NHS an almost sacred emblem, one that not even Atlee’s 1945-’51 new government could have foreseen, is how an aspiring working-class made its social-economic journey in willing lock-step with this particular bureaucratic institution.

Such mutuality is at the core of economic adjustment. Without the new middle-classes tied into national direction Western democratic principles become eroded. Why Westminster style adversarial politics can continue to square up to each other is because its institutional architecture offers a reflection of its wider core values. America is desperate for a new consensus but it is currently finding none. It is throwing its nascent civility out of the window leaving its notion of free speech tarnished. Britain is therefore in a remarkable head start as its ability to hold a civil national and international conversation is considerable.

Far from wishing to tear up its institutions ‘common woman’ wants to deepen her partnership. But this still means opening institutions up for new dialogue. With the coming pain new spaces will have to open between all institutional players. Where America is a country that has ‘written itself down on paper’ Britain can still write itself new versions of history. If Americans do not really know what ‘life, liberty and freedom’ mean because they cannot as yet hold a meaningful exchange due to their social landscape Britain can open up the public sphere with confidence. Vidal called the US a country that is obsessed with the ‘foetus and flag’. And one that has yet to let go of the ‘conquest model of leadership’. A deeply socially divided nation cannot yet find the forums to exercise its freedoms. The quality of debate has yet to match the quality of its constitutional vision. We can take great pride yet in our community’s ability to exchange deeply opposing worldviews without descending to screaming.

For it is one thing to have forbearance written down as a principle it is another to educate people to understand how to compromise on their individual desires. Britain’s future will be based upon the principle of a new generosity towards concession. That communities collectively agree what is important over and above what is desirable will be a shift as great as the post-war dividend of a welfare system. In ’45, despite 200+% debt to GDP ratio, new lock-step institutions staved off unrest.

This is about solidarity with future generations and interpreting well their investment in partnership with liberal democratic systems. For sure America is a land of great contradictions. There are few greater contradictions between the grand rhetoric of American aspirations and provincial life. Philip Roth’s The Human Stain reveals the difficulties of language and meaning in the pressure pots of small town America: “People are bored here, they are envious, their life is as it is and as it will be, and so, without seriously questioning the story, they repeat it…” Like small town provincial Britain what is said by the external ‘rooted cosmopolitan’ voices has to be re-voiced when it travels into communities. And vice versa.

And this is part of the pathway to reform. As the joke goes it doesn’t matter what American politicians say about Make America Great Again; as the American citizen imagines greatness to be a society of prosperity, democracy and security, along with good government. Currently that society is called: Denmark! If America wants to get to Denmark it is not going the right way about it. As America creaks from the power of the lobbyists buying off its politicians the question for Britain is how it establishes a fuller alignment of its bureaucracies to public purpose in the way the Danish have?

It’s difficult to see this transition in Britain without leadership that re-engages the provinces on their aspirations and invites regional leadership that voices these desires. This then is an extended and tolerant dialogue across the whole community at all levels. Grassroots mobilisation is closely linked to education. For education gives access to economy and economy gives a politically charged voice. The ability to translate a complex British landscape within local communities is a task for gifted facilitation. The ability to understand the balance between state, law and accountability is a crucial component for a recovering economy. Unless regional communities can argue their broad interests then full progress will inevitably be slowed.

Core institutions then are in a powerful interplay. That doesn’t mean an automatic devolution of power will equal vibrant and newly engaged communities. But it does mean exploring Weber’s relationship between traditional charismatic and rational authority. The spiritual energy from traditional communities has to interface with the institutional rationality of a functioning state. This is where we are back to fostering significant compromises between competing aspirations. Mixing the vibrancy of the pluralistic and cosmopolitan into the provincial and traditional requires patient debate about what we mean by social mobility. Nonetheless, this will be traumatic.

American despair currently is less about Trump but rather the inability from the 1950s onwards for successive US administrations to appease a newly socially mobilised populace. Its post-war society had heeded the call to get a college education, tempted by the promise of middle-class rewards. But the fruits of ‘hard work’ didn’t materialise in lock step. As social mobility crawls along in Britain, despite the efforts of the Blair government to expand education, the ‘hot debate’ that is brewing is about the relationship between expectation and government accommodation. This isn’t all bad news. But it will require mature public spaces. Facilitated by even more tolerant and patient forms of leaders who understand the under-currents of public opinion. They weren’t read well in ’45 and ’16 but presently they are shifting firmly towards a new social contract which could be as radical as we have ever seen.

How to develop shrewd senior leaders who will address northern Britain’s productivity challenge (and Covid-19 recovery)

In Uncategorized on April 6, 2020 at 11:17 am

ONCE UPON A TIME an organisation had supercharged leadership, new buildings, expanded vision, ‘wrong people’ fired, ‘right people’ hired, but, the toilets did not get cleaned. Then, by magic, they were sparkling. What, pray, made the difference?: “Management spoke to us,” said the cleaning staff. And so they lived happily ever after in the Land of Increased Productivity.

Covid-19: Our greatest strategic leadership challenge since the 1970s? UK premier Margaret Thatcher was a ‘declinest’, viewing post-war Britain as a failed state, and one needing her drastic surgery. Others viewed the transition from imperial power, establishment of the NHS and a welfare society, to membership of NATO and the European Union, as a great achievement of social economic transformation. The scale of the current crisis is still being calculated socially as well as economically. Is this further decay of the Western model, a super-test of civic resilience, and possible evidence other social fabrics are better woven for future trading?

This story is not quite true. But the truest bit is management action is oft presented as fairy dust. Sprinkle and productivity transforms. We love magical change. To portray northern Britain’s productivity crisis, however, gritty realism is our genre.

There is good news. Britain has a greater number of high productivity companies than France and Germany. The bad news is, we have a longer-tail of below-average companies dragging down the whole. Many of these are in the north. Northern leaders are focused and assertive, if not aggressive, but ‘like fairy gold, it will be dead leaves in the morning’ if we do not unpack this puzzle together as we head out of the EU.

How did we get here? Well, in 1960 the UK had the highest productivity in Europe. Over the next 50 years, our performance increased (yay!) but at a slower rate than our major competitors (boo!). And then slumped dramatically following the financial crash (eek!); down to 0.4% (from an annual average of 2.4% growth). Today we are 16% less productive overall than our G7 partners (leading advanced economies). And now with Recession 2020 via Covid-19 we are facing our greatest strategic leadership challenge since the 1970s.

Growth in finance and professional services was stellar up until 2007 but these stars are slightly less bright. The top performers tended to mask the wider picture. Now, even the most productive companies have also slipped out of the fast lane.

This then is a story of lost-momentum. Especially in northern regions. This is also a story of management and leadership, plus ye olde story of skills. More so, it is a riddle inside a puzzle. Certainly a whole region conversation. We can point to tendencies, the toxicity of control freak management, underinvestment, difficulty measuring the emerging economies, London, Brussels, low wage rates, fractured communities…  stop! You say.

There is no single solution, not even Boris Johnson’s infrastructure stimulus. No Sir Lancelot Spratt to come onto the Sick Man of Europe ward and bombastically order cod liver oil for all. As the picture is so contradictory. Hamletian ambiguity is with us. And returning to a Frankensteinian mechanistic management toolkit will prove lethal. When performance drops, the temptation is to run faster. Tighten the nut by all means, but you are still holding a spanner awaiting the next rupture.

Currently, the most productive firms are exporters. Businesses focused on local markets are part of the UK’s long-tail of underperformers. But, you might say, we all know businesses that are surviving despite the chaos. I can name a few high street top brands who still have pennies in the bank, but are dying before our eyes. Their management teams fiddle, destroying brand value. Pragmatic management can be prone to saying ‘cash is king’. But these poor performers lack the ability to stand outside of their institutionalised selves.

Under pressure, tunnel vision becomes a condition. Boardrooms are messy places and some senior figures will hammer contradictions flat rather than explore through dialogue. It is always a matter of time before loyal consumers become adulterous. Spotting their first flirtation is leadership’s responsibility. Cash then is not the same as value and does not signal loyalty. The opportunity for UK plc is to wrestle better with the amorphous notion of complex change along with the even more foggy notion of economic value. The company accountant and Finance Director, for all their virtuosity with balance sheets and investments, still need to be in an extended dialogue on value creation. Activity x rarely leads to profit outcome y.

This requires renewed imagination to conceive the complex web of value-adding activity. Science only first conceived of the human body’s network of blood vessels when the scientist pictured it as a possible interconnected whole prior to full dissection. Extending a glimpse into a 3-D hologram that is projectable onto the boardroom wall is as vital as any pithy bullet-pointed executive summary.

We have been guilty then of championing evidence-based-thinking. Just because it is visible? No, because, as T. S. Eliot said: ‘our modern eyes have been cut wide open’. We are dazzled by the bright glare of so-called evidence. A collective shooting from the hip. Bright data gets us through scrutiny sessions but not into the grey corners of long-term value. Of course any data from any source, are still tiny fragments of a whole, by definition. 0.01 is easily presented as 0.99 from under-pressure directors. Why? We have the tendency to prefer answers to questionsExplanation has become Caesar’s thumb. To explain of course is to close inquiry, and just when we needed to open up an extended search for new understanding. This is the weakness of our modern minds which prefer dialectics (systems thinking) than dialogue (holding competing logics in play).

I term this tendency ‘sunshine leadership’, one that seeks to fix the weather, ignoring the vast ecosystem of contradictory data. Rainy days are not to be despised. This a shift in the image of future leadership. A chance also to refresh the national fish tank of intellect through which new senior minds are formed. Leaders who recognise the ecosystem’s complexity, collaborate, hold dialogue and craft new business models cut shrewder figures. When a leading North West CEO recently mentioned Danish philosopher Søren Kierkegaard (master of irony over chop logic) in the same breath as Friedrich Hegel (suggested father of modern systems thinking, if not modern thought generally) the sea state has clearly changed. The French champion their philosophers over their entrepreneurs, surely?

This is, of course, a story of post-war Britain. UK plc struggled to distribute its industrial largesse to the people who dug coal, built planes, and fought epic wars. The NHS and welfare state were hurried actions, part of the double movement of free-market societies. A correction to the turmoil of market revolution. However, post-war Germany and France invested in technical colleges while Britain invested in high-sciences. Its applied science vision evolved a middle management ethos that could translate concepts into products where UK management inherited a patriarchal and patrimonial legacy that was radically out of step with a liberalising workforce.

We conceived of beautiful concepts but could not convert them into durable products. New Jaguar motorcars sat beside the road with their owners puzzling at the engine’s failure, to discover later that the undertrained workforce had (folklore tells us) poured sand into the radiator as a means to communicating with untrained managers. A major failure of both irony and logic.

And British public and political life is going through this rupture still. Britain is torn between professional management (meritocracy) and continuity management (institutional). The UK’s slow rise of professional management and leadership capability is because at heart UK society still values continuity over change. Typical of a non-professional craft-based British model that served its industrial growth through to the beginning of the 20th century. I argue neither are silver bullets to increased productivity. Both have important offerings and should be kept in tension. We need our crafts, arts and sciences in healthy balance.

A fully modern meritocratic Britain is then on hold. The rise and rise of the professional politician/lawmaker is not addressing Britain’s performance on the world stage.

Productivity itself is a combination of business efficiency enabled by a nation’s institutional efficiency. Business will take the hit via its order book if we invest in grand infrastructure projects, but not schools, roads and rail (HS2 being a chimaera). Ironically and logically, productivity is a whole nation exercise and it is an exercise in creating a climate where the loos are cleaned because of a purpose well beyond management’s ingenious ‘employee of the month’ scheme. Tokenism, gimmickry, gestures are just that. The value of effort is measured by alignment to long-term outcomes. Business leadership and political systems being in a lively dialogue achieve this. We have seen this dialogue strained through over-regulation. But also we are looking for leadership that is capable of speaking into these issues. And often we continue to appoint leaders who are technically adept, pragmatic, excessively action-orientated but unable to hold dialogue overtime on evident complexity.

Leadership development activity that expands space for competing systems of thought, their ambiguity and ecology, is enabling. We can aid leaders to walk for longer, and more happily, in these dialogue spaces, renewing their capacity to lead into future economies. Such patient vulnerability is genuinely ‘strong leadership’; and tends to lead to creativity, with this shrewd figure seeking conversations that carry their message across an ecosystem.

It is true to say Frankenstein’s monster was erudite, intellectually sensitive and motivated. But dissolved when his myopic goal was thwarted. Hamlet cuts an even more flawed figure, and one moving into the shadows and out again. But, as Wilson Knight suggests: a ‘man almost supernaturally shrewd; he has ‘seen through humanity’’.

From Churchill to Covid to the collective good: in a media-saturated now a voice from elsewhere

In Uncategorized on March 31, 2020 at 5:32 pm

IN a media saturated moment here are some tangents that offer a ‘voice from elsewhere’. With the leadership space being dominated by the Immediate Actions of crisis leaders this is in the spirit of dialogue-on-the-margins which travels a little more slowly through this period. There is a suggestion here that a ‘dialogical approach’ is useful at this stage as we search for deeper understanding.

Link below:

https://www.dropbox.com/s/pjjup41v92bo9rs/Churchill%20to%20Covid.m4a?dl=0

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