It’s been almost 60 days since I have been working in a project for a corporate company, the project that has been offered to me is a dream project for people in this work line and I was so glad that I got it.
Let me explain you in a better way *(Picture this)* You are the CEO of a shipping company. Let’s call it as a Blue Star Line Shipping Company, you and your team have been working on to build the world’s largest luxury passenger ship, with safety measures that make it almost unsinkable. The whole world, including your shareholders and your board members, are watching with bated breath, to see how the investment in this dream project will pay off.
On the appointed day, your dear baby sets sail. As it nears the end of its maiden voyage, you get this business update from your line managers ‘700 happy passengers reached safely. But on performance reports go, that’s pretty damn accurate, but it doesn’t tell the whole story, it doesn’t tell you that this is the story of the “Titanic“ your luxury liner just hit an iceberg and 1517 people lost their lives. Only 706 survived. Happy to be alive.
The Corporate world is full of stories of the ‘700 passengers who reached New York safely. Given the pressures to perform, the quirky demands of quarterly earnings guidance, unforgiving boards and markets and of course fat bonuses tied into results delivery, the bad news is not only slow to come, it’s often suppressed. Hidden and buried.
We either find newer metrics to report (volume sales are lower, but in value terms, we’ve grown) or we report anecdotal evidence (who says people prefer our competitor’s products)
I have this email from a customer who raves about us. Or we conveniently brush the past under the carpet of a rational excuse and paint a rosy dramatically different future. OHHHHH!! Well above things reminds me of Anirban Dasgupta’s stand up on Corporate Jobs & Motivation
It’s not just the sales and marketing guys who succumb to the temptation of delaying the bad news. CEO and boards are guilty too. Remember Bear Stearns, the iconic US investment bank that collapsed in 2008?
On 10th March 2008, the CEO Alan Schwartz was quoted as saying, the balance sheet, liquidity, and capital remain strong! And by 16th March 2008 the bank was dead and gone. Why didn’t the CEO of the errant banks sound the warning bells earlier? Why do sales managers delay bad news? Why do managers look to report imaginary silver linings in the face of otherwise gloomy, dark clouds? And now remember Chanda Kochhar the ICICI bank case. You yourself can figure out the difference what exactly I’m talking about.
The answer lies in our ability (or should that be inability) to manage bad news both in terms of delivering it and receiving it. It has been documented that for success in the corporate world, what managers need is not just high IQ (Intelligence Quotient) but also a high EQ (Emotional Quotient) and the difference between the good managers and truly great managers lies between BNG (Bad News Quotient) Senior managers and board should ensure that they create an environment where they get the bad news first.
It’s fashionable, but grossly inadequate, to merely say: “GIVE ME BAD NEWS FIRST” what matters is how you react thereafter. Getting the bad news early not only helps prepare everybody for the impending disaster but, if delivered right and acted upon, it could actually help avert the disaster itself.