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Boston Globe: Business Leaders Are Anxious To Avoid An Angry Call From The President-Elect

Bill George knows all about pressure from big government.

When he was chief executive of medical device giant Medtronic Inc. in the 1990s, he decided to close a plant in France and move jobs to more cost-efficient sites in eastern Europe. He was promptly told by French political leaders that he would have to continue paying wages to idled workers in France for a year. It hurt, but that’s the price he had to pay.

Today, from his perch as a senior fellow at Harvard Business School, he is watching Donald Trump strong-arm and threaten companies. And like others at the business school, he is trying to gauge how to handle a president-elect who has castigated Carrier for moving jobs to Mexico, ripped into Boeing Co. for making too much money on an Air Force One contract, and rattled drug makers by vowing to bring down prices of medicines.

George’s advice to today’s chief executives? “Right now, you just want to stay out of the line of fire,” he said. “Carrier was willing to absorb a noneconomic decision for a period of time by keeping jobs in Indiana. I see this as more of a symbolic move by the president-elect to make a statement. There’ll be two or three more of these moves. Then we’ll get back to business.”

Others see Trump’s bluster as part of his personality and longer-term strategies, and say captains of commerce should learn to adapt. Some believe the downside could be offset by Trump’s proposal to lower taxes which, if enacted, would prove a boon to business.

“You have to decide how important the presidential crankiness is going to be to your company’s future,” said Harvard Business School professor Joseph Fuller, former chief executive of the global consulting firm Monitor Group. “When the president-elect of the United States calls and says, ‘I need a favor’ — and it’s not material to your business and you know he’s going to be cutting your corporate tax rate — I’m going to say, ‘Yes sir, I’ll do everything I can.’ ”

Still, the former business leaders say chief executives will resist proposals that would force their shareholders to lose money, or thwart a company’s business strategy. One test could come soon, they say, if Trump follows up on his stated opposition to the merger of AT&T Inc. and Time Warner Inc. and tries to block the $85 billion deal.

“CEOs aren’t going to be cowed by being called out in tweets,” said Kevin Sharer, another Harvard business professor who was chief executive of biotech Amgen Inc. “If they think a move is fundamental to the company, they’re going to go forward with it.”

At the same time, Sharer said, business leaders should recognize Trump’s tweets carry a message — US jobs will be valued by the new administration.

“He is certainly laying down a marker to the country, saying he cares about jobs in America,” Sharer said. “He’s saying one of his priorities is saving jobs. He’s not doing it in a skillful or elegant way, but he’s saying it’s a priority. Companies will think harder about moving jobs out of America. And there’ll be policies that will make it attractive to keep business here.”

On Wednesday night, Trump expanded the ring of his business wrath beyond the executive suites. After Chuck Jones, head of the Indianapolis local of the United Steelworkers Union, said Trump had “lied” in talking about how many Carrier jobs had been preserved, the President-elect tweeted that the union should “spend more time working — less time talking.”

Trump’s use of social media has amplified his messages, but there’s a long history of presidents pressuring businesses or wading into the marketplace, Fuller said. He cited President John F. Kennedy forcing steel makers to roll back prices in the 1960s and, more recently, President Barack Obama’s bailout of Chrysler and General Motors Corp.

“You can go back to Teddy Roosevelt and see frequent interventions by political executives in business decisions,” Fuller said. “We used to call this jawboning. The president would use the bully pulpit to cajole both employers and unions in the national interest.”

While Trump’s focus has been on outsourcing and foreign trade deals he says have sapped American jobs, ex-Medtronicchief executive George said the larger issue is technology advances that have made many manufacturing jobs obsolete. George said the new administration should focus on German-style industrial policy to upgrade the skills of US workers and prepare them for jobs in fields like robotics and computer programming that match the needs of domestic businesses.

Manufacturers in Massachusetts appear to betaking a wait-and-see attitude toward the incoming administration.

“My guess is that he might continue doing this from time to time, parachuting into these situations,” said Christopher Geehern, executive vice president at Associated Industries of Massachusetts, a trade group concerned with costs and regulations. “It won’t solve the problem, but it focuses attention on manufacturing issues, and that’s OK. Manufacturers are pleased he’s shining a light on some of the issues that are driving companies overseas.”

Christopher Anderson, president of the Massachusetts High Technology Council, which represents computer software, hardware, medical device, and robotics companies, said no company wants to be singled out — but Trump’s actions appear to be purposeful.

“I don’t know who he’s going to be tweeting about tonight or tomorrow,” Anderson said. “But when people see 1,000 jobs [at Carrier] not leaving the US, they say he’s off to a good start, and he’s not even president yet. There’s a high expectation that there’s going to be a reduction of barriers and regulations in the Trump administration. And that’s going to make it easier to bring cash back into the country and expand the manufacturing base here.”

 

This article was originally published by Boston Globe on 12/9/16

Serenity

The past year has been a painful one for many Americans. Our political differences have separated us into two camps, with angry and hostile words thrown at each other. Long before Election Day, it was clear that regardless of who won, the new President would face a deeply divided nation. Today, weeks after the election, many people are still focusing on the political scene, feeling angst over the latest Cabinet appointment.

For myself, I have decided to adopt American Theologian Reinhold Niebuhr’s “Serenity Prayer”:

 “God, grant me the serenity to accept the things I cannot change,

  courage to change the things I can,

  And wisdom to know the difference.”

This prayer challenges us to be serene amid turmoil and chaos, while using courage and wisdom to make a difference in the world. This isn’t easy, but is a goal worth pursuing. Such equipoise is the mark of authentic leaders.

Serenity

Accepting the things we cannot change is difficult for anyone with the passion and belief that he or she can change the world for the better. When I was young and naive, I thought I could tackle the world’s greatest problems – from war to health to poverty – and have a leadership role in eliminating them.

The reality is that none of us can independently eradicate poverty, eliminate disease, ensure quality education, guarantee rewarding jobs for everyone, or ensure all people have financial security. Even Bill Gates must feel humbled by the vastness of the world’s challenges as he applies his vast resources. But if we focus our energy and our efforts on specific goals that are within our grasp, we actually can change the world – the world in which we live.

Accepting our limits in dealing with intractable problems requires serenity – the quality of being calm and tranquil. When we get caught up in our 24/7 society and upset by the outrage on social media, it is all too easy to become stressed out, discouraged, and angry at the world. When we are too reactive, we lose perspective that our actions are part of the long arch of human progress, and their impact may not be immediately apparent.

When I feel anxious about the world, I have found my meditation practice helps me regain that sense of tranquility and serenity. It also enables me to focus on the most important things in my life and be grateful for my blessings. In this way, I have learned to accept the things I cannot change. Then I can put aside my frustrations with the world and set more modest goals for things that I can change.

Courage

Courage is the quality of the spirit enabling people to face difficulty, danger, and pain without fear. Courage cannot be learned in the classroom; it must be experienced in real world situations.

At Medtronic, we focused on restoring health for patients struggling with chronic disease and discovering ways to help more people. Our proudest accomplishment during these years was increasing the number of people restored annually to full health from 300,000 to 6 million per year. Today, some 14 years after I retired, that number stands at 30 million people annually.

In retrospect, growing this number demanded a great deal of courage from my colleagues. They took risks to discover breakthrough therapies, challenge the approval process of the U.S. Food and Drug Administration to get them released, and ignore Wall Street’s short-term pressures and invest for the long-term.

When I retired from Medtronic in 2002, I searched for a new purpose in my professional life. After exploring leadership opportunities in government, business, and non-profits, I went on a working sabbatical in Switzerland to learn and teach at two leading Swiss institutions. It was there that I realized I was most passionate about helping develop a new generation of authentic leaders. I recognized this purpose required a high level of humility about the limits of this goal. There was no chance we could eradicate all the poor leaders, nor claim any credit for the success of the authentic ones. But an emerging new generation of authentic leaders gave me great hope for the future.

Since 2004, I have pursued that goal by teaching at Harvard Business School (HBS) and applying those ideas through writing books and articles, as well as mentoring many emerging leaders. This took a surprising amount of courage as all my 30 years of experience had been in running large organizations. In Switzerland and at HBS, I was all alone in creating new courses for which I had no training or experience. While my colleagues at HBS were extremely helpful, in the classroom I was on my own with 90 challenging students with very high expectations. When I proposed a new course called Authentic Leadership Development that included a small group format (a radical change for HBS), I was required to go to the dean for approval.

As a first-time author, I also faced monumental challenges in getting a book published on authentic leaders. My first book draft was rejected by a dozen publishers. Thanks to my mentor, Warren Bennis, I was able to write Authentic Leadership, which was published in 2003 and became a modest best-seller. That gave me the courage to conduct research on 125 authentic leaders and publish True North in 2007, which is widely read today and used by corporations and academic institutions in developing leaders.

Wisdom

My grandfather, a Dutchman who came to the U.S. in 1878 at the age of two, had a plaque in his home that read: We grow too soon old, and too late wise.

Wisdom requires discernment and the insights that come from experiencing life’s challenges. It took me decades to recognize how long it takes to acquire wisdom. In my younger years, I thought I was a lot wiser than I was. This was especially true in accepting the limits of my ability. It was only by processing the pain of disappointments and acknowledging my limitations that I gradually accumulated a modest amount of wisdom.

In college, a wise mentor told me, “Bill, you can’t change human nature,” but I didn’t believe him. It wasn’t until my forties that I accepted just how hard it is to change other people to behave authentically and ethically. You can only have a modest impact on those people you are in direct contact with, and limited impact on others. When I finally accepted this reality, I have found great satisfaction in taking vicarious pleasure – but no credit – in the accomplishments of authentic leaders.

When we have the wisdom to acknowledge our limits and the limitations of our impact, we can focus our energies on making a difference in our immediate world. Only then can we find the serenity to accept the things we cannot change. This in turn gives us the courage to change the things we can – and realize the fulfillment that comes with it.

 

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