From Risktakers to Surgeons and Undertakers

When I wrote my book, Risktaker, Caretaker, Surgeon Undertaker- the four faces of strategic leadership, I had a difficult time finding examples of Undertakers. In the past few weeks the number of Undertaker leaders has significantly increased. Some of these leaders, like Merrill, merged their "storied" company with Bank of America. Lehman Brothers disappeared and had to settle for a garage sale. AIG became a ward of the United States Government.

One of the underlying causes of all these failures, what the high risk, high roll, GO BIG mentality that permeated these companies. GO BIG never works. But unfortunately another result of this fiasco is that there are now BIGGER financial services and not smaller ones. It is interesting to note that the financial companies who have prospered during this crisis are the smaller, specialized, focused local and regional banks.

It should be clear that strategically focused organizations who resist the GO BIG, GO GLOBAL temptation and stick to what they know and can lead are the WINNERS.

Bill Rothschild, author of RISKTAKER, CARETAKER, SURGEON, UNDERTAKER, the four faces of strategic leadership and

THE SECRET TO GE's SUCCESS.

Team of RIVALS-- Lessons learned from LINCOLN..that we could use today.

As you and I sit at our televisions, read our newspapers, listen to the radio and so on, we should be totally depressed. But fortunately we are still alive and keeping our heads above the rising tide.I am reading a GREAT book TEAM OF RIVALS by Doris Kearns GOODWIN.. a Pulitzer Prize winner and a great writer...

This book continues to provide insights into what it takes to LEAD IN A CRISIS... Lincoln surrounded himself with those who ran against him and continue to think and act that they were far superior to Lincoln himself. This gave Lincoln the opinions and insights of those with different perspectives and views. It enable him to make decisions that were beyond the obvious and even contradictory to what he believed.

Lincoln had the ability to LISTEN, THINK and THEN MAKE DECISIONS, even if they were not what he desired and even were not what he wanted to do...but he was a REALIST.His greatest failure was selecting GENERALS..but he continue to stay involved and finally got it right. Unfortunately the General he really wanted was Robert E. Lee. He offered Lee the generalist position, but LEE elected to fight for his friends, neighbors and family and not the UNION.I wish that we had a leader like Lincoln today...but unfortunately Bush has been a TOTAL failure. His focus on loyalty and not competence has led to the PROLONGED Iraqi war...

The only individual who might fit the Lincoln level of leadership is JOHN MCCAIN... it is clearly not Obama...I hope that the United States is LUCKY enough to select a leader that can stop our HARVESTING and WORLD decline and is willing to do the SURGERY required and not just follow the polls and the instant analysis of unqualified and biased journalists and instant experts.

Bill Rothschild, author of THE SECRET TO GE's SUCCESS...and RISKTAKER, CARETAKER, SURGEON, UNDERTAKER...the four faces of strategic leadership...and author of http://www.strategyleader.com/.

REALITY and ADAPTABILITY...part of the GE success factors.

Two of the reasons that GE has had a successful 126 years is because the leaders were adaptable, set and met realistic expectations. It is highly promising to see the Immelt team continue this successful leadership approach.

It is clear that the company must reduce its dependence on Financial services and its complexity. GO BIG has not worked and focus and selectivity must become the new theme.

Bill Rothschild, author of the insightful,comprehensive, objective 126 year history of GE, THE SECRET TO GE's SUCCESS...a global bestseller.

We are in CRISIS...We need SURGEON LEADERS

It Takes A CRISIS
· Change… is the theme of the United States today.
· But it requires a Major, clear crisis to get the type of change we need.

Unfortunately we are NOW IN CRISS...so Need Surgeon Leaders…

You can find situations like this through out our history, but the most recent crises included: the GREAT DEPRESSION, THE WAR TO END ALL WARS, THE SPUTNIK SURPRISE, 9/11.

In each case, the country was forced to make major changes and to become more focused and dedictated.

• In the Great Depression the country was willing to allow the President and the Democratic Congress to take complete control of thecountry to turn it around.


• World War II saw the change in the number of terms a President could serve and the willingness of the people to get behind what was originally an unpopular war.


• Sputnik allowed Kennedy to reallocate resources to a SPACE program that has contributed not only to the US’s global military power, but also help provide all of the micro-electronics, software and computer power to make the world more fun and permits worldwide communications.


• 9/11 is still not clear. It permitted Bush to overthrown the Iraqui dictator, but unless the war is “won”… it may have caused a major change in our view of ability and willingness to be the police force and democracy missionaries of the world.
  
  United States CAN’T Afford our traditional types of leaders..
  We can’t “be all things to all people”, believe we are INFINITELY wealthy and POLICE and CONVERT THE WORLD…
  
  WE NEED “SURGEON LEADERS”…NOW!!!
  THE UNITED STATES HAS LIMITED RESOURCES…
  
  Since the end of World War II, the United States has executed “all things to all people” strategies and programs. The underlying assumption was and still is that we are LEADER of the world, have INFINITE resources and can not only grow our own country, but be the police man of the world and the missionary to convert the world to democracy.


• 
  In the 1950’s and early 1960’s this was the same attitude and underpinnings of many of the now deceased or critically ill, United States corporations. Names like Westinghouse, RCA etc.. can now only be found on tombstones or references in business history books and case studies. Others like General Motors, Ford, Chrysler, US Steel are possibly likely to join the group or will be restructured as only shadows of their past.
  
  The United States as a nation is moving from the moderate growth to the declining growth stage of its economic and possibly military power. But is still acts and has a Government that pretends to be a GLOBAL ECONOMIC POWER, when it is on the rapid decline of the growth curve.
  

TOO MANY RISKTAKER/CARETAKERS AND NOT ENOUGH SURGEONS.
In my book (Risktaker. Caretaker, Surgeon, Undertaker- the four faces of strategic leadership) I classify leaders into four types and describe their characteristics. This is a summary of each of the leadership characteristics and its relationship to the life cycle of the organization.

• 
  Risktaker Caretaker Surgeon Undertaker
  Missionary Cautious Nothing and No One sacred Decisive
  Intuitive Managerial Challenges “folklore” Compassionate
  Adaptive Analytical Portfolio manager Unselfish
  Dynamic Experienced Ability to sell at a profit Realist

EMBRYONIC CONTINUING GROWTH MATURING/ SLOWING NEGATIVE GROWTH

Let’s take a look at the situations that each of these president’s faced and their style of leadership.

• 
  · Roosevelt--- inherited a country in crisis… the depression required taking major risks to jump start the economy. His first act was to close all of the banks… move the country to a more socialistic than capitalistic situation. He took enormous risks in helping England survive and some even believe the was willing to let the Japanese bomb Pearl Harbor to get the country into the war.
  · Truman… the risktaker of all time…he bet on dropping the bomb…even though he had very little insight in how it would work out…
  · Eisenhower was the caretaker of all time… he just let the world happen… no waves..
  · Kennedy… not in time long enough to really classify… he was a risktaker when he tried to invade Cuba, but lacked the courage to see if it would work… he took a major risk with Russia and they backed down…so he was more of a risktaker than a caretaker.
  · Nixon…was a risktaker, but his personality negated what he was able to do.
  · Carter…was a true caretaker and a micromanager…
  · Reagan was a risktaker.. and was able to create an economic evolution and the creation of a CULT.
  George HW BUSH was a caretaker… really didn’t do much. His invasion and quick retreat of Iraq demonstrated this.
  · Clinton the typical caretaker… was willing to change to fit the popular reaction.
  · Bush W.. was a risktaker…but didn’t really understand the risk he was taking and surrounded himself with individuals that supported a “hawkish, foreign policy.
  
  No Longer NUMBER One!!!
  
  The NEXT President, whoever he must be a realist and move into the surgeon category. Let’s examine some of the reasons that this is needed and then the characteristic the President and the Members of Congress must possess.
  Current SITUATION:
  A Debtor Nation
  · United States has become a major DEBTOR nation---(some figures)
  · The American consumer is a highly leveraged and unable to continue to spend like there is no tomorrow. The Sub-Prime problems is making it even worse.
  · China and other nations have enormous economic power and are CREDITOR nations.
  · United States dollar is eroding and enabling other nations to purchase our companies, assets, national resources at bargain prices.
  · “FOR SALE”.. appears to be the message of today’s United States institutions, whether are the “in-crisis” financial institutions, like Citi and Merrill, the real estate or the infrastructure and ship yards. This is a clear sign of a declining nation.
  
  Divided Politically, Socially and Economically


• 
  · Country is highly divided and there is no real majority.
  · The very wealthy are getting wealthier and the poor are becoming wards of the state.
  · Jobs and assets have been GIVE AWAY to the highest bidders, or the opportunists who have take advantage of the “ very weak, declining dollar” and a Greenspan led Federal Reserve who was more political than economists.
  · The nation must recognize it is on the upper end, declining position of the growth curve and not on its rapid growth position.
  Infrastructure has been harvested
  · The INFRASTRUCTURE… road, water, electricity have been HARVESTED and are on the verge of a major collapse… there is MAJOR GRIDLOCK in all of the major cities, there is flooding and water damage in even the most affluent cities, there are BLACKOUTS when it rains…
  · Education spends more on the buses, security than on TEACHING… there is no discipline in the classrooms since everyone is “politically sensitive” and no one wants to be sued.
  
  In short, America is becoming more like a THIRD WORLD nations, but behaves like it was what it was… the BANKER, SAVIOR OF THE WORLD…
  
  WANTED—Surgeon Leaders.
  Surgeon leaders are those most suited to “re-structure” and change the business priorities and focus. These are individuals who are first and formost realists and clearly recognize that if the patient, in this case the country, doesn’t under grow surgery they will become invalids or even worse will die.
  There have been many great surgeon leaders in the history of America business and these are the type of people we need to lead the country now. Let’s outline some of the key actions required, NOW:
  · “NOTHING and NO ONE is SACRED”- The country leaders, including the President, his administration and Congress must be will to step back and evaluate all of the country needs and requirements and not make anything or anyone sacred.
  · Set Priorities and Allocate Resources- Using a clear set of viable criteria the leaders must do an OBJECTIVE evaluation and set priorities and then be willing to communicate what needs to be done and what can’t be done… this means being POLITICALLY INCORRECT is needed.
  · DO what they SAY…this is the essence of strategic leadership. Strategy is what you do and not what you say. Unfortunately, this will take a major change in the “political mindset”..where it is common to say one thing and do something else.
  · LINE ITEM VETO- The president must be able to cut out the polk and not permit the valuable and needed programs to be surrounded by politically motivated, non-productive waste full polk.
  · BALANCED BUDGET. Willingness to live in our means and not just continue to add to the debt… this means that there must be a CONSTITUTIONAL BALANCED BUDGET and no exceptions. If programs are increased in one area, others must be decreased or more revenues must be generated.
  · TERM LIMITS FOR EVERYONE- Time limits on all members of government. Roosevelt made it clear that there must be time limits on the Presidency and so we have a two term president. But the Senate have become the House of Lords and a long tenure group of “too comfortable” and too Powerful individuals. If it make sense for two terms for the PRESIDENT, why doesn’t make sense for the Senate. The House members terms should be extended to four years and they two must only be able to serve for two terms.
  · STOP FINANCING OUR ENEMIES. Stop all FOREIGN aid and examine where it should go. Don’t give money to our enemies or to those who are wealthier than we are. We can’t buy friendship and these funds should be used to solve real problems and be time limited. No annuities that go on and on and are actually used to undermine their purpose.
  · NO MORE POLICEMAN AND MISSIONARY- Moving from the policeman and “democratic” missionaries to willing to allow other countries to manage their own countries and select the best form of government for them and not what may work of us. This also means a reality test on whether democracy is really working here. It is only partially working.
  IMPOSSIBLE DREAM??
  Reading this list of requirements may make you think that I am totally Naïve and it is impossible to get these type of changes. After all, the current systems and policies protect the incumbents in government and allow them to get enough “polk” to keep them in office. There are too many and strong lobbyists who have created one of the only growth industries in the United States. There is a great fear of not giving away money to all nations even to our enemy since the country is already unpopular.
  So, on the surface it is impossible and the current policies and practices will continue UNTIL THERE IS A REAL CRISIS. The crisis is likely to take the form of major recession, combined with massive unemployment and even some form of the “bread lines of the Great Depression”.
  
  A CRISIS SOCIETY.
  
  If there is a major crisis… the real issue is whether the country can respond and how long it will take. The best solution, is to take actions now… ELECT a SURGEON GOVERNMENT.

Bill Rothschild, author of Risktaker, Caretaker, Surgeon, Undertaker- the four faces of strategic leadership...available on www.strategyleader.com

GE will overcome... if it learns from its successes and failures.

Over the past few months, I have highlighted many of the reasons that GE is having problems and why its stock is moving in the wrong direction.But I totally agree with Jeff Immelt that GE is a strong, well managed, strategic company and should be more highly respected and valued.GE has faced major problems before and has been able to adapt and even make the company stronger.

• 
  It started with GE's ability to survive the GREAT DEPRESSION. The Swope/ Young team was able to survive during the Great Depression, even though the company revenues dropped 75%. One of the human resource innovations was the LAMP business allowed workers to volunteer to work four days a week, with four days of pay to prevent 25% of the workers from losing their jobs.


• 
  In the 1950's, the GREAT ELECTRICAL CONSPIRACY, which was a major price fixing scandal, shocked the company to its core and even changed its succession plan, but it was able to move beyond and the company became stronger.

• In the 1960's Borch embarked on a number of misguided ventures, most of which failed and caused the decline of its stock, but Borch took action and installed the strategic management system which saved the company.

One of the criticism, I have received about my book THE SECRET TO GE's SUCCESS, has been that I am too supportive of GE.

It is true I strongly believe that GE's leadership has been able to ADAPT to change and, though I have challenged the Immelt GO BIG/ GO GLOBAL strategies, I am still a GE fan, I believe that Immelt and his team will do the same and succeed. (However, this will be even more difficult since the company is now so big and complex, but if Jeff and his team, learn from the past and uses GE's enormous, deep leadership, technological, innovative and marketing skills, GE will win and the GE investors, as well as all stakeholders will reap the rewards).

Bill Rothschild, author of the most objective, comprehensive view of GE's successes and failures and the lessons we can learn from them, THE SECRET TO GE's SUCCESS...now a global best seller in six languages, including Simplified Chinese.

GE Accounting A strength or Limitation?

In my latest book: THE SECRET TO GE's SUCCESS, I conclude that one of the GE's strengths has been its financial management and accounting systems.

I joined GE as a member of the Business Training Course (now called Financial Management Program) and learned to admire the talent of the financial organization. It was clear that when GE reported its earnings there was 99% confidence level.

During the Welch era, there was concerted effort to reduce the power of the financial organization, because it was felt that it inhibited creativity and entrepreneurial flexibility.
It is clear that over the last thirty years that GE's accounting and financial auditors have not be able to assure investors and government officials that GE's financial statements and practices meet the historical standards of the past.

There are several very disturbing situations that illustrate this reality.
First was the surprise of GE's missing its expected results in the first quarter of 2008. It was clear that everyone, even the CEO, was surprised that about the miss. This caused GE stock to fall from 42 to 25 and it still hasn't recovered. The investment analysts and companies have moved the company into a hold mode.

Second, the company has had to restate its annual statements several times over the past few years and lower its reported earnings.

Third the SEC announced it was issuing a Wells Notice and taking civil actions and there are several stockholder suits.

It is difficult for me to imagine that GE would find itself in this position and it has clearly impacted the company's credibility and reduced shareholder value. It is clear that the reduction of the internal auditing, the inability to spot external and internal changes that can impact the top and bottom lines and the shear size, complexity, continuing "deal making" and global expansion are all causes of these problems.

The question is whether current financial leaders are ready, willing and capable to do what it takes to restore the confidence of all key stakeholders, especially the investment community and government agencies.

Bill Rothschild, author of THE SECRET TO GE's SUCCESS (now in six languages) and GEWatcher blog found on (http://www.strategyleader.com/)

My right to steal!!!

During my career I have always recognized the rights of authors and creators.

I was taught that when you use the "intellectual properties" ( a "legalistic" term for copyrights and patents) that you must and should recognize the source. I have always referenced the ideas of others and have sought permission to use materials when they exceed a legal limit).

But this ethical and professional approach seems to have been ignored by today's professionals.

We read about professors, authors, politicians, even University and Religious LEADERS, who plagiarize others speakers, books, articles for their own personal benefit.

Recently I have had two incidents where an newspaper and a professor, took pages and key illustrations from my recent book" THE SECRET TO GE's SUCCESS" and used them for personal gain.

We all recognize that CHINA has permitted that books, articles and even products were duplicated and sold without any recognition or renuneration for these "intellectual properties". China is now trying to join the international community, but they are very slow and still willing to bend the rules.

It is clear that ethics and values have deteriorated and that the self interest of individuals has been placed higher to the self interest of individuals and even society.

THIS MUST CHANGE... we must recognize that "intellectual properties" must be protected or the motivation to create will die and so will we.

Bill Rothschild, author of the SECRET TO GE Success and four other best selling business books.
Visit his site: http://www.strategyleader.com/

LATIN pertains to the ENTIRE US..not just GE...

It is amazing to me that the PRESS and most of the American voters lack an understanding of what has enabled the UNITED STATES not only to survive but prosper....

In my book THE SECRET TO GE's SUCCESS... I used LATIN to describe why GE not only exists but is still successful and prospering.

Let me use this same word to describe why the United States is still growing and might be able to prevent its loss of position.

LEADERSHIP is the first word in the LATIN summary. The United States was gifted with having the RIGHT leader AT A TIME OF CRISIS....

• WASHINGTON was able to lead the country when it was an infant...he was truly a RISKTAKER and so were other leaders...like Adams, Jefferson, Madison and so on.


• LINCOLN was able to salvage the Republic and put it back together...another RISKTAKER.


• ROOSEVELT led and keep the country from collapsing at a time of the GREAT DEPRESSION.


• TRUMAN had the courage to use the atomic bomb and stopped potential slaughter.

I am not sure what other Presidents should be on the list...but most of them were positive contributors.

ADAPTABILITY... the UNITED STATES has been willing to change its mind and even move in a different direction..

TALENT... the country has been willing to develop its own talent, until recently...when it has moved into becoming to dependent on other countries.

INFLUENCING..the UNITED STATES has been willing to influence global opinions and lead in helping to protect and enhance HUMAN RIGHTS... it is not done yet but the country continues to be MISSIONARIES in trying to enhance human rights.

NETWORKS.. the UNITED STATES has been willing to establish GLOBAL communications networks and systems to support it drive to convert and enhance HUMAN RIGHTS.

In short, my story about GE and its reason for success, could be applied to the total country... the real issue is whether the missionary zeal of the past leaders will continue in both GE and the ENTIRE UNITED STATES...

Read my book... and then see if my zeal is founded.

Bill Rothschild, author of THE SECRET TO GE's SUCCESS...and http://www.strategyleader.com/ website.