Running on Empty

Georgia is running out of water. So is southern California. Cities all across the bottom half of the U.S. are clamping down on sprinkling lawns and running fountains due to drought. More alarming, in the country's breadbasket, the Ogallala Aquifer, also known as the High Plains Aquifer and the world’s largest underground water source, is draining at an unsustainable rate. Experts estimate it will run dry sometime in the latter half of the century. You know supply shortages are nigh when brilliant investors like T. Boone Pickens, Jr., are plunging into water.

What's this mean? I don't need to remind anyone that our need for water is as critical as the need for air. Nothing is more foundational on Maslow’s hierarchy of needs. Yet how does that square with the fact that nothing is as frequently squandered or as poorly allocated as water? If we managed corporate resources like this we'd be watching one giant revolving door of bankruptcy.

Message to public officials: Keep track of this resource. Take inventory, track usage, estimate replenishment, publish figures. It's a lot easier than monitoring planetary warming (a related issue that also needs attention).

If we discover that we're mortgaging our grandchildren's future, communicate that. We also need to hear proactive solutions and how they will help. Whether it’s with employees or citizens, when leaders communicate truthfully and suggest solutions, everyone pulls together for the common cause. (Did you know, you could say, that it takes 5,000 gallons of water to produce one pound of beef?) The point is that today we need clear, strong leadership to solve water issues, to say nothing of other problems facing the world. It takes all of us, everyday leaders.

High Noon in Detroit

Always interesting, sometimes scary, always avoidable: That's the dynamic whenever labor and management square off. Once negotiators fail, workers stop working, and management watches productivity grind to halt. It doesn't have to be.

The General Motors-United Auto Workers strike is the latest in this showdown of wills. It's no secret that union membership has ridden a long road downhill, no more than it's a secret that GM's profits and market share is pointed in the same direction. So what will happen? Still hard to say.

What should happen? First, each party should do something stunningly obvious but apparently humanly impossible: Look at how they can help each other to become more successful. If neither win, GM, in a tenuous position anyway, would double its troubles. Likewise, workers don't always connect the dots: If their employer is saddled with expenses that it's competition lacks, the company has a hard time competing, will shrink and, inevitably, will die.

The old-fashioned demands of Big Labor for job protection ties management's hands. Shackles make it hard to react to competitive pressure. Work rules that stand in the way of efficiencies need amending -- and in return Big Labor's constituents need to share in productivity and profit increases. Align the interests of both sides and exciting things start to happen.

Let's hope this graying icon of Corporate America has management that is equitable. Let's also hope the UAW's members realize the same thing. Finally, let's hope that Washington will recognize that a broken health care system is among the troubles and will work to help both workers and management.

Diplomacy for Dummies at Columbia U.

University presidents used to be among our nation's brightest leaders. Today, they seem to be puppets of boards or regents and alumni groups. The latest example: Columbia University President Lee Bollinger. A few days ago he violated so many rules of management in his introduction of Iranian president Mahmoud Ahmadinejad that it should become a part of coursework for years to come.

First, it's important to note that Bollinger was correct to back his faculty who initially proposed inviting Ahmadinejad to campus. That said, you don't have to be a diplomacy school graduate to know that when you invite a controversial figure to speak to your organization, you don't cave in to your critics so thoroughly that you overcompensate and nuke your guest in the introduction. It's impossible to make Ahmadinejad, through-and-through an anti-Semetic tyrant, a sympathetic figure. But Bollinger came disturbingly close. That was a disservice to the causes Bollinger on some level was trying to promote.

Leaders speaking in public need to know the room, to know their organization. Bollinger knew a Q&A session would follow Ahmadinejad's address. Did Bollinger actually think his students and faculty were going to serve up softballs? He should not have been so bluntly offensive with his questions to Ahmadinejad, anymore than he should have been gracious and solicitous. Simply hand Ahmadinejad over to the audience (rhetorically speaking). All the points that Bollinger made in his ambush would have come out.

Bollinger also committed one of the worst leadership sins by attempting to save his own neck without consideration for how it would effect his university, his country and the world. It appeared to me that Bollinger was more concerned with finding a way back into the good graces of his detractors on the Wall Street Journal Op-Ed page who were aghast that he would allow Ahmadinejad to set foot on campus. Now, in some respects, Bollinger looks as out-of-touch and as Ahmadinejad announcing that Iran is a homosexual-free zone. We can only hope the episode doesn't have a lasting effect on diplomacy at home or abroad.

Of Bridges and Proactivity

Which is better? Correcting a problem after you've experienced it? Or, watching the dashboard for warning signs and taking corrective actions to avoid the problem in the first place? Obviously, the latter is better: Proactivity saves more time, money and, in some cases, lives, than reactivity. I grade the business world a "C" on being proactive. Government? Regretfully, it gets an "F."

Which brings us to the matter of the I35W bridge failure in Minneapolis, my hometown. Indeed, hindsight has all kinds of advantages that foresight lacks, and the catastrophe's cause will take a long time to determine. But the human and engineering disaster looks like a perfect example of reactivity trumping proactivity. A few years ago, inspectors judged the bridge "structurally deficient." They graded it on two scales: On a scale of 1 to 9, it earned a 4; and its structural integrity marks were 50 point out of a possible 120. In every school and class I've ever attended, those are failing grades.

The failure of this bridge, which I had used a few times every week for the past three decades, has provoked a lot of tortured semantic arguments about the meaning of structural deficiency. Yet this tragedy, as tragedies often do, is provoking a gross bulge of reactive actions by government and its custodial politicians. Think about it. How do you, in your business, or the representative that you elect to make large community decisions, operate? Poised to pounce when things go horribly wrong? Or, snooping for symptoms, digging below the surface to root causes and acting before a full-blown crisis explodes?

If transportation was your business and you read a report on a 40-year-old bridge, built to carry 40,000 cars daily and now carrying 140,000 cars each day, that graded it structurally deficient with a rating below 50-percent of where it should be, would that cause you to take action? Or, would you delay another few budget cycles? The answer is as obvious as it should have been when President Bush was handed a daily brief entitled "Bin Ladin Determined to Strike in US" one month before 9/11.

Here's the lesson we all need to keep learning: Throughout your day, be aware of symptoms, not just their negative results. It will save a lot of heartache in the long run. Whether government or business, whether it's bridges, airplanes or widgets, let proactive snooping to discover root causes ring across the land.

Avoiding the Vacation Blues

Ah, yes. We are in the midst of that special time: Summer vacation. It carries great expectations and many fears. How hard do I have to work to get ready to go? What calamity could strike while I'm gone? When I'm back, how hard will I have to work to catch up and fix everyone's mistakes? Here's six tips to help enjoy your expectations and reduce the chance of your fears becoming reality.

1. Set your email and v-mail with a message that says you're gone. Add how callers can get things resolved while you're gone.

2. Before you permanently slip into flipflops and shades, meet with colleagues who're in the best position to cover for you. A few things to tell them: a) describe what you'd like their help on; b) let them know what could go wrong and how to handle it it does; c) set the bar for a legitimate reason to make that "emergency" phone call. On the last point, also consider the degree to which you want to unplug—completely or partially—on vacation.

3. Set meeting dates for shortly after you return from vacation with whomever you hand things off to. That way they know you will following up on whatever you've agreed to. That increases the chance things will get done while you're gone.

4. Enjoy your time away from the office. Be present. The more you're thinking of business, the less you're with those you care about during precious vacation time.

5. Immediately upon return, set some "shut-in" time. This is do-not-disturb time to catch up on emails, vmails, paperwork and other communication so you hit the ground running with current data.

6. Have that meeting with whomever you handed things off to. Follow on what was done and what's still undone so you can schedule your time accordingly.

Follow these tips and you'll enjoy vacation more, and your business will have a better chance of not missing a beat without you.

'Entitled' Executives and Entrepreneurs

I've always enjoyed Frank Deford, the sportswriter who constantly hits that perfect balance of thoughtful and funny, especially during his weekly radio commentary on National Public Radio. Deford's new book, "The Entitled," is a fictional account about how baseball players, fawned over their entire lives, from a very early age, believe their every whim should be catered to with a smile. They should get what they want, when they want it, if not gratis then at a steeply discounted price. Period.

You know the types, either personally or through the media. It occurred to me that the notion of "The Entitled" doesn't necessarily cover just pro athletes or celebrities. Unfortunately, it also covers business people, from corporate CEOs to Wall Street moguls—even some entrepreneurs.

It's easy to understand how this develops. We get used to employees telling us what we want to hear, laughing at our dumb jokes and doing our grim bidding. It's intoxicating, habit-forming. But we also need to understand that we're building a false reality; one that almost always leads to a big fall. Kahlil Gibran has a great line about this: "The lust for comfort murders the passion of the soul."

How to avoid this trap? Learn to listen for the truth. First, open yourself to it. Try the Rule of Three: When you ask your people what they think, remember that they'll lie the first two times you ask, and generally they'll tell the truth the third time. Then, when they give their opinion and it isn't what you want to hear, don't kill the messenger. Take it in, live in it. As my dad's Swiss grandmother always told him when he was a misbehaving little boy: "Billy, it's what you learn after you know it all that really counts." That's good medicine. Habit-forming, even.

Where Yellow Cabs Make More Green by Going Green

I just returned to Minneapolis from a board meeting in Vancouver, B.C., where a Toyota Prius taxi drove me and Mary from the airport to our hotel and back. Taxis, I don't need to tell you, are a huge source of toxic emissions, greenhouse gases and a constant consumer of fossil fuels. It only makes sense that the most heavily used transportation in a region should walk lightly on its surroundings.

I asked our driver if customers liked the Prius. He said they were such a hit that Yellow Cab was ordering a lot more. I checked with Yellow Cab, British Columbia's largest taxi company, and they confirmed that they had added 40 hybrids to its 210-car fleet and were in the process of converting as many as 30 more cars to hybrids in the next year.

I love this story. Green is good business because so many of us want to find ways to help, even in small ways. We want to reduce the threat to our climate, so businesses, recognizing where public opinion is going, are more and more keen on finding creative ways to green up. There's an ever-widening base that will support it. Green makes more green, which is good for our wallets. But I like when people do it for the benefit of peace and health and see the big dollars as a fortunate by-product.

Kellogg's Proves it Cares for Kids

The people at Kellogg's announced last week that it will adopt stricter nutrition standards for the foods that it advertises to young children. The Center for Science in the Public Interest's Campaign for a Commercial- Free Childhood (CCFC), and two Massachusetts parents, will not proceed with lawsuits against Kellogg's (Disclosure: I am a CSPI board member).

CSPI Executive Director Mike Jacobson made the great point that Kellogg, by committing to these nutritional standards and marketing reforms, is vaulting over the rest of the industry. He also hoped that a rising tide will lift all ships—that Kellogg's will influence many other companies that cater to kids. I second that, and it's badly needed.

Health care costs continue to out-pace the consumer price index. More and more links between diet and health are discovered every week. Diet-influenced diseases like diabetes are rising at a staggering rate (heart disease and cancer cause death in 1 of every 2 people and 1 in 3, respectively). Corporate leadership, in companies small and large, is badly needed. Kellogg's may have faced a little external inspiration, but that doesn't minimize their move. Kudos to Kellogg, and tidings to Tony.

Jerks Need Not Apply

"Lars Dalgaard is CEO and cofounder of SuccessFactors, one of the world’s fastest-growing software companies ... All the employees (he) hires agree in writing to 14 'rules of engagement.' Rule 14 starts out, 'I will be a good person to work with—not territorial, not be a jerk.' One of Dalgaard’s founding principles is that 'our organization will consist only of people who absolutely love what we do, with a white-hot passion. We will have utmost respect for the individual in a collaborative, egalitarian, and meritocratic environment—no blind copying, no politics, no parochialism, no silos, no games—just being good!'" — Robert Sutton, The McKinsey Quarterly, 2007 Number 2

Mr. Dalgaard is onto something. The advantages to his no-jerk policy are enormous. Bulls in the office are as dangerous as they are in china shops. Yet owners rarely deal with it. The consequences are staggering, both in terms of the emotional toll on brittle employees and in cold, hard cash.

Mind-body research performed in the past decade has proven conclusively that, without intervention, emotional or psychological turmoil can weaken the body's immune system and lead to physical illness. The upshot? More absenteeism, a productivity plunge, rising health insurance costs and high turnover. One employee's personal problems can set off a chain of events that could threaten a small company. As the old proverb goes, "For want of a nail, the kingdom was lost."

Cheat Vacation at Your Peril

Ah, summer, time to get down to ... work? That's what an important new study says my small-business friends have to look forward to. Fewer and fewer entrepreneurs expect to take a summer vacation of a week or longer—59 percent now versus 67 percent four years ago, according to OPEN, the small-business arm of American Express. I can only guess that most of these owners feel they'll get more done and thus put more food on their family tables, a laudable goal.

I wish that were so, but I don't think so. Without vacation breaks, what the owner picks up in quantity of hours worked she loses in the quality of that extra time. All work and no play kills her skills, whether it's planning and organizing, interacting with employees or decision-making. They're the same deleterious effects that are also caused by getting little sleep, eating poorly and exercising rarely.

Early in my entrepreneurial years, I tried cheating the clock in all of those ways and more. Turns out they actually cost me time when I factored in my overall quality of work. So think again when you try to increase your company's profits by skipping that vacation or pulling into the fast-food lane. It ain't gonna happen—you can't cheat on time off any more than you can cheat sleep or the taxman.

A Tough-Minded, Warm-Hearted Leader?

I still don't know who I'm going to vote for come presidential primary season. But I do know that I'm looking for a courageous candidate who's warm-hearted and tough-minded. Democrat Barack Obama showed me that a few weeks ago when he criticized Detroit automakers ... in Detroit. I still can't stop thinking of the guts that took. It reminds me of 1992 when candidate Bill Clinton criticized Sister Souljah ... in front of an African-American audience. Obama told the executives that they needed to be more responsive to customer's needs (fuel-efficient cars) as well as the country’s needs (reducing dependence on foreign oil). Obama's temerity is a rare commodity for political leaders of either party, where standard operating procedure for stumping to locals is telling them what they want to hear. Obama also mixed caring into the talk as he proposed to help car companies who've committed to raising gas-mileage standards. Being a great leader—whether in business, a not-for-profit or politics—involves mixing a warm hearted with tough minded, in an authentic and courageous manner. Obama nailed that in Detroit last month.

When CEO's Go Bad

I'm still picking my jaw off the ground. Did you see what Northwest Airlines CEO Doug Steenland has decided to award himself? A $26.6 million bonus. It would be one thing if Northwest was on course to fantastic profits. Ah, no, hardly. Mr. Steenland's airline is trying to break out of bankruptcy. What's wrong with this picture? He's taking this massive payday at a time when he has asked his employees to take a 40 percent pay cut over five years to get his books into the black. Mr. Steenland's stock-option gain also stiffs Northwest's investors and creditors. It's simply unconscionable to profit from everyone else's pain like that.

This is a textbook example of what it is for a business leader to NOT be caring or spirit filled, two of the six traits I believe build a strong, honorable company. Back when I had my own business, my bonus plan was no different than management's plan. Mr. Steenland could learn a thing or two from Brad Anderson, the Best Buy CEO who in 2002 actually gave his annual option grants to his Best Buy colleagues. Mr. Anderson has been doing it every year since. There you go, opposite ends of the corporate responsibility spectrum: From Anderson to Steenland.

"$350 Liquor? Just Spreading the Wealth"

Floyd Norris's column (behind the pay wall) in today's New York Times biz section, about high-end hi-balls in Manhattan, made me think about the flip side to the massive growth in incomes and wealth in the U.S. There's a lot of entrepreneurial opportunity here. All this green tells me that suddenly there's a lot more room at the high end of the price-quality-service continuum. Big business, with their steamrolling marketing budgets and capital muscle, is adept at exploiting these niches. But in the age of low-startup costs, thanks to widespread digitization, the little guys and gals can also step in.

Where are the opportunities? High-end personal training? Upscale medical practice? Garbage disposal that's as discreet, bonded and private as a white-glove home cleaning service? Use your imagination.