The unlearned lesson

Institutions have a bad habit of not learning lessons. The unlearned lessons may even be from their own history, yet they go unlearned or unheeded. Examples continue to pile-up like a stack of unread reports or emails.

To compile just a short list of such examples, consider the following organizations and what each failed to learn: the Catholic Church, Toyota, VW, Wells Fargo, Penn State University, Michigan State University, The Ohio State University, Congress and the current President just to name a few.

The Catholic Church has known about a significant problem for many decades with pedophile priests. Yet, protecting the institution was the first motivation, not stopping the abuse of children. Even after major scandals occurred in Boston and Ireland, signicant change did not occur to prevent future molestations.

The unlearned lesson is you focus on the abused as you fix the problem, not protecting the institution. When you address the problem openly and painfully, that is how you protect the institution. Cover-ups eventually fail, because the truth has a way of getting out.

Penn State, Michigan State and Ohio State are major universities and sports marketing franchises. Leaders within Penn State and Michigan State have known for years that there was a sexual predator in their midst. Yet, they chose not to act, trying to hide it from the public. As a result, more young boys, girls and teens were molested. By not addressing the problem, they brought appropriate shame to their marketing brands.

Ohio State has a similar issue with a physician who worked with the wrestlers. It has been known for years by athletes and coaches to avoid this doctor due to his practice of checking for testicular cancer for any visit, such as the flu, cold, fever, etc. Yet, nothing was done until several men came forward about their experiences.

For-profit companies are notoriously protective of their brands, but the better solution is to come clean and remedy the problem. Toyota was very slow on their floor rug braking problem. VW purposefully cheated emissions tests and were very slow to fess up after discovery. Many car companies who used Takata air bags also were slow to reveal a massive and deadly problem.

But, it is not just car companies. Banks and financial entities have experienced issues with aggressive and even illegal sales practices. Wells Fargo has justifiably gotten a lot of press for setting up false accounts as staff tried to keep jobs and earn bonuses. Bank of America and American Express have been fined for selling products and services that people did not request or need. And, pay-day lenders have a business model of excessive usury.

Even our governments have a hard time learning lessons. When the incumbent dishonors the office, the institution must penalize the incumbent. It matters not what party the incumbent belongs to. This applies to local, state and federal levels of government. It must apply to Congress and the White House. The punishment can vary from formal rebuke to censoring to removal from committees or from office.

Trust in institutions has waned. Some of this mistrust is due to hyperbole, such as what the current President has done to protect himself, but much is due to institutions not dealing with problems openly and appropriately. It also is due to them being more concerned with image than substance.

On this latter point, another unlearned lesson is the best way to keep your job is to do your job. And, when others don’t and/ or harm people, the institutions should fix the problem and let people know that they have. It is the right thing to do and avoids covering up and abetting criminality.

Message to GM, Duke Energy and Toyota – If you only listened to a couple of us

Having witnessed the new CEO of GM, Mary Barra, testify before Congress yesterday regarding GM’s failure to remedy problems they knew about, I am moved by a comment from one of the mothers whose child died behind the wheel of a malfunctioning GM car in 2009. Paraphrasing the mother’s comments, “if they only listened to one or two of us, these other people would not have had to die.” I cannot find a more apt quote to surmise how many feel.

In fairness to Barra, she was not in charge of GM until this year, but she needs to get to the bottom of this and rebuild people’s trust. What we did learn yesterday is GM changed a part in one car model without changing the part number to track if it would be successful, which is unheard of. In other words, they tried to sneak a change in to limit risk. This is malfeasance on top of the decision not to heed warnings and fix something. People did not have to die.

GM’s woes follow closely on Toyota being fined $1.2 Billion for its covering up of accelerator problems. Toyota’s handling of this issue was extremely poor, at best, and it is not over. Several managers may face criminal charges for ignoring the cautions and requests of subordinates to fix the problem. Driving a run away car with an acceleration issue led to deaths and accidents. People did not have to die.

Not to be outdone, Duke Energy, who had a stellar reputation up until the late 1990s until it made some poor acquisitions and accounting issues tainted its image, decided to forego fixing problems with coal ash ponds after being sued last spring by several environmental groups. These coal ash ponds are near waterways, as the coal ash has to be kept wet so the pollutants in the ash don’t blow into the water and people’s lungs. Some of these waterways actually provide drinking water to local communities. Instead, Duke chose to work with a friendlier state agency and governor, who used to be employed by Duke and agreed to settlement of $99,000 (which is a tad shy of Toyota’s fine) and to fix the problem on their time. Now they have had a coal ash spill and some other leaks to contend with. No one has died as of yet, but drinking polluted water is not good for people’s health.

These issues are on the heels of Penn State not addressing a sexual predator scandal in its midst and it becoming more known that the Catholic Church has been covering up for sexual predators among its priests for years. I mention the sex scandals as well, as all of these issues relate to one key theme – leadership caring more about their image than their customers and people who have trusted them.

“If they had only listened to one or two of us, these other people  would not have had to die.” If they had listened to the first voices in the sex scandals, others would not have had to be raped by a priest or Jerry Sandusky. If Duke had only heeded the warnings and lawsuits, they could have been ahead of the problems, rather behind them. Leaders need to lead, not protect their hind end or organizational image. Hopefully, Barra can steer GM better toward being more trustworthy. Hopefully, Pope Francis can continue to rebuild the trust in the Catholic Church. Hopefully, Duke can remedy their failure to act. Hopefully, Toyota and Penn State have learned their lessons. You owe this to us. And, it is time we start demanding it.

Note: My friend Barney has an excellent post on GM which can be found with the attached link. http://mountainperspective.wordpress.com/2014/04/02/is-general-motors-good-for-america/comment-page-1/#comment-3513