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Naughty CEOs in 2010: Revisiting Senge’s 7 Learning Disabilities

January 1, 2011

Tony Hayward, formerly of BP

Call it a culture of myopia and greed, but there remains a huge dynamic tension between organizations lead by CEOs who demonstrate little concern for employees, shareholders or the environment and those led by CEOs who practice socially responsible corporate behavior. The former have the propensity to inflict not just harm but to making repeated mistakes. The latter get smeared by the same media brush.

Why does this happen?

One would think that people would learn over time; after all, we’re supposedly the most intelligent life forms on Planet Earth, though I think that my Labrador Retriever, Max, might dispute that.

Unfortunately, human history is littered with the carnage and entrails of past blunders. Pick a century or a decade. You’ll find lots of examples. The recent decade had an extra-ordinary long list of horrendous errors, which can be traced back to decisions made by those in positions of authority, whether in the public sphere or in business.

Let’s take a look at Forbes Top 10 CEO Screwups in 2010. Not surprisingly, BP’s former CEO Tony Hayward is front and centre for his infamous performance during the Gulf of Mexico oil spill. Second in line is Mark Hurd, former CEO of Hewlett-Packard (fired for falsifying expense records), who was then quickly hired by Larry Ellis of Oracle. Third place goes to Timothy Huff of GlobeTel Communications, sentenced to four years in prison for securities fraud.

The list continues with some well and not so well known notables. Check it out, including one of my previous posts on financial executives.

One thing you don’t want to see happen as a CEO who’s screwed up is being made a mockery on the Internet, such as with this video of former CEO Tony Hayward:

To help try to gain some degree of understanding on why this occurs, I’m revisiting Peter Senge’s Seven Learning Disabilities from his seminal management book The Fifth Discipline: The Art and Practice of the Learning Organization. Released in 1990, The Fifth Discipline has not only retained its relevance to the challenges facing organizations in a globalized, volatile world, but I believe its content and key messages are even more important today.

The 7 Learning Disabilities

Most organizations, as the collective entities of human beings with all their baggage and foibles, have difficulty learning. When the word “organization” is used, it’s vital to remember that it’s people who actually make them up, not the buildings, office furniture or other physical assets.

Senge provides a set of what he calls learning disabilities, which underlie many of the problems and mistakes inherent in how organizations (public, private, non-profit) typically function. If you wish to get at the root of a problem, it’s necessary to first identify these disabilities.

1. I am my position. Because we’re expected to be loyal to our jobs, we tend to confuse them with our own identities. As Senge explains: ‘When people in organizations focus only on their position, they have little sense of responsibility for the results produced when all positions interact.’

2. The Enemy is Out There. We have a tendency to blame others when something goes wrong, whether it is another unit in the organization, a competitor or government agency responsible for regulatory policies.

3. The Illusion of Taking Charge. We hear all too often that we must be ‘pro-active,’ taking action to make something happen. However, pro-activeness can really be reactiveness in disguise. Senge sees ‘true pro-activeness’ as coming from our ability to see how we contribute to our own problems. In essence it’s the outcome of how we think, not how we react emotionally.

4. The Fixation on Events. The ongoing discussions and conversations in organizations focus typically on events, those ‘urgent’ day-to-day issues that grab our attention. But the real threats to our survival are not events but rather the slow, gradual processes that creep up on us. We need to move away from short-term thinking to long-term thinking.

5. The Boiled Frog. This parable states that if you place a frog in boiling water it will hop out immediately. If you place it in cool water and gradually turn up the heat, the frog will remain in the pot, growing groggier until it cooks to death. What we learn from this parable is that if we wish to see the slow, gradual processes, we must slow down and pay attention to the subtle as well as the dramatic.

6. The Delusion of Learning from Experience. We learn best from direct experience. In organizations, however, we usually don’t experience directly the consequences of our decisions. A major underlying reason for this is the functional silos that exist. These silos impede the flow of communication among people. The organization’s ability to analyze complex problems is subsequently greatly weakened.

7. The Myth of the Management Team. This reflects the desire for management to appear as a cohesive group that is pulling in the same direction. The reality is that in most management “teams” the need to uphold their image means that dissent is frowned upon and that joint decisions are “watered-down compromises.” As Harvard’s Chris Argyris Chris Argyris has discovered through his research (and referred to frequently by Senge), most organizations reward those who promote senior management’s views. Those who pose probing questions or who ‘rock the boat’ are penalized.

Reflect on each of these learning disabilities in the context of your own leadership and work environment. If you have time, think about how they relate to the monumental errors perpetrated by a large cast of CEOs (as illustrated by Forbes). For example, was Tony Hayward (of BP) being pro-active during the Gulf oil spill, or was he in reality reacting to an environmental catastrophe, making it up as he went along.

How about Mark Hurd: Was the enemy really out there in regard to his seemingly minor infraction of expense claim manipulation and alleged sexual harassment?

Watch this video from January 2, 2011, on CBS 60 Minutes on Glaxo Smith Kline and the contamination of prescription drugs. What role does the company’s CEO play in this PR nightmare?

Yes, there’s a distinction between committing stupid mistakes and ethical lapse and crimes. However, there’s indeed a strong learning element embedded within all of these types of leadership miscalculations and mistakes. They can generally be traced back to the 7 learning disabilities, with the exception of truly sociopathic CEOs.

Suggestion: Hold a lunch and learn in your organization, at which you’d talk about Senge’s 7 Learning Disabilities and your group’s experiences in the workplace and community.

I wish to emphasize that it’s not just private sector CEOs and senior executives who own shares in stupid behavior and bad decision-making; Government and quasi agency executives are just as guilty.

Anyone remember Hurricane Katrina, and FEMA’s grossly incompetent response? You may recall President G.W. Bush’s infamous praise of former FEMA head Mike Brown in 2005: “Brownie, you’re doing a heckuva job.” Indeed, what a guy. The rest is history.

How about Ontario, Canada’s monumental waste of taxpayers’ money in the digitization of medical records, a scandal that rocked the province two years ago?

Or how about the crown jewel: turning a blind eye to the grossly extended housing bubble in the United States? Does the name Alan Greenspan ring a bell?

But let’s not beat up on only America and Canada. Numerous other countries under the “leadership” of their (usually) elected leaders are active participants in public sector executive incompetence: the United Kingdom, France, Italy, South Korea, Ireland, Iceland, Russia… You get the drift.

Senge’s seven learning disabilities may be seen as a framework, from which people – not organizations – can start to learn from their mistakes and to cease their perpetual repetition. And the first ones in line to reap the benefits should be those leading organizations.

Are YOU ready to lead?

I am putting myself to the fullest possible use, which is all, I think, that any conscious entity can ever hope to do. -Hal 9000 computer, 2001, A Space Odyssey

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9 Comments leave one →
  1. Ritah permalink
    January 11, 2013 9:26 am

    This article was written two years ago but reads fresh as new! Just like your comment above, timeless material this is! Thanks Jim.

    • January 11, 2013 7:33 pm

      Thanks Ritah. I hope you had a chance to check out my new Leadership 2012 post which I put up last week.

  2. January 8, 2011 12:36 am

    Great article – thank you, Jim.

    • January 8, 2011 1:35 am

      Thanks Jasbindar. Stay tuned for Monday’s post (my 200th) which is on a totally different topic…JT

  3. January 2, 2011 3:04 am

    Excellent, Jim!

    I find that #6 is becoming more and more of an issue as our developing workforce expects more frequent promotion and/or movement through a variety of positions to enhance their “personal development plan”. The result being that few are in any given position long enough to truly experience the fallout of the decisions they make. The result – in the words of Bob Sutton and Jeff Pfeffer – people are rewarded for saying smart things rather than doing smart things.

    • January 2, 2011 3:30 am

      You nailed it, Geoff.

      It’s endemic to to the public service, but it’s very relevant to the business sector. Lots of incongruent words that are misaligned with actions. Or what Chris Argyris (of Harvard) talks about “Espoused Theory” vs. “Theory in Use.” We’ll pursue next week.

  4. Jacquelyn Scott permalink
    January 1, 2011 5:20 pm

    An excellent reminder of Senge’s work on the first day of a new year! Thanks, Jim!

    • January 1, 2011 6:09 pm

      Thanks Jacke. Senge’s work is not only timeless but becomes more and more relevant to how organizations must function in a chaotic world.

      All the best in 2011!


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