Great Ideas: Learn the truth about your firm

Larry Bossidy, the former CEO of manufacturing giant Honeywell International, offered this explanation for why most companies do a poor job of executing: “They don’t face reality very well.” You have to admit you’re doing badly before you can figure out how to turn things around. (And if you’re doing well, it’s tough to sustain that if you’re so caught up in self-congratulation you fail to analyze what you’re doing right and where you still need to do better.)

Robert M. Tomasko cites Bossidy’s observation to lead off the chapter “Tell the Truth” in his just-released book Bigger Isn’t Always Better: The new mindset for real business growth. The suggestions he presents for how you can discover the truth about your firm include:

1. Listen to the voices of strangers: You’re more likely to get the straight story from a stranger than from someone you’ve worked with for years, says Harvard Business School professor Michael Wheeler.
2. Ask someone to play court jester or devil’s advocate: Humour can make it much easier to convey truths. So can putting someone in the role of devil’s advocate, charged with arguing against the decision you’re contemplating.
3. Be wary of misguided loyalty: Some employees overly idealize their bosses, especially in times of danger and change. In trying to protect their leaders, they may filter out bad news you need to hear sooner rather than later. Self-deprecating leaders are less likely to run into this problem than narcissists. They know you should treat flattery like chewing gum: enjoy it, just don’t swallow it.
4. Build some lag time into key decisions: Back in the glory days of General Motors, Alfred Sloan Jr., the company’s CEO from 1923 to 1946, noticed one day that everyone on GM’s executive committee agreed on a crucial matter. That made him nervous. Sloan therefore postponed further discussion until the next meeting, telling the committee members that would give them time to develop some disagreement among themselves. He saw the lack of such disagreement as a warning that the committee didn’t really understand what the decision was all about.
5. Try cash: If candour completely breaks down, show your staff the money. Offer a sizeable cash bonus to the person or team that comes up with the best argument against doing what you planned to do, and encourage competition among the contenders.