Tuesday, March 31, 2009

CEO's: Be Accountable or be Ousted

Leadership is a privilege. It is earned by the strategic decisions and actions you make every day and even by the ones you don't make. All the business school training in the world could not have prepared us for this economic environment with one exception; Accountability.

Have you ever met someone that promises to do something and does not follow through on his promise? Magnify this by 1,000x when leaders of an enterprise do not fulfill the promise of their plan to their people, their customers, and their stakeholders.

Accountability is "an obligation to account for one's actions". A person in a leadership role either accepts the highest level of accountability or does not. Barriers to leading an accountable culture range from; politics, blurred ethics, time, cost or…the fact that is really hard for some to hold themselves accountable.

This week's news reported General Motors CEO, Richard Wagoner was ousted by the Obama Administrations Auto Bailout Task Force. It is a signal Americans are serious about changing corporate cultures from their current lack of accountability to a corporate culture that thrives on accountability.

As a highly compensated leader, he is THE most accountable for the success of the GM enterprise. During his tenure, Wagoner made changes in cost reductions. He reduced the US workforce from 177,000 to about 92,000 today. He closed factories, stopped making the Oldsmobile brand, globalized engineering and made some progress with the rigid United Auto Workers on hourly wages. Making cost reductions for a multi-billion brand is easy.

Did Mr. Wagoner feel accountable to innovate at the core of GM's business-- to be a better company and compete in a sustainable way? Creating an accountable culture of innovation is the only way to compete in this category. GM needs a new brand story that inspires employees to design and manufacture cars that consumers want to buy.

Should he have been ousted? What three things would you do to turn GM Around?

Comment on our blog. Tell us your story about accountability.

Source: WSJ March30,2009, Websters Dictionary

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