Playing To Win

A Management System for Forgiveness

How to Learn Instead of Cover Up

Source: CartoonStock.com

I have been meaning to write on the subject of forgiveness since the mid 1990s when I worked consecutively for two deeply religious organizations — the first and only times that happened. Recently, I was spurred to think about the topic by a question from a gentleman who works at the US Department of Defense. So, after a quarter century, I decided to dedicate my 35th Year II Playing to Win/Practitioner Insights (PTW/PI) piece to A Management System for Forgiveness: How to Learn Instead of Cover Up. You can find the previous 87 PTW/PI here.

A Little Background…

In the mid 1990s, I discovered while working with a client that it was a deeply religious company. Most of top management was of an evangelical Christian bent, so much so that I doubt that anyone could have gotten to be CEO without belonging to the favored denomination. A board member liked my work there and introduced me to another company that he chaired — of the same bent — and I did work for it as well. Neither was a tiny family company. Both were multi-billion-dollar public enterprises.

To my surprise, I found them to be the most duplicitous companies I have ever worked with. There was more lying, subterfuge and covering up of mistakes than I had seen in any company to that point, or have seen in the quarter-century since. My knee-jerk reaction was to see them as extremely hypocritical — espousing Christian values and doing exactly the opposite in practice. But, over time, I came to view the two companies as having a management system problem that I believe is common across the business world.

Enabling Management Systems

I view Enabling Management Systems (EMS) as a key piece of strategy and in fact, wrote the very first piece in this series — 87 articles ago — on the Role of Management Systems in Strategy. I believe that a company must make choices to create the requisite EMS to build and maintain the Must-Have Capabilities to win (How-to-Win) where it has chosen to play (Where-to-Play) to meet its Winning Aspirations.

However, regardless of how good a company’s EMS are, the humans who operate them and work within them will make mistakes because all human beings are flawed. This leads to the important question of how an organization deals with mistakes? I find that the general answer is: ‘badly.’ The result is the covering up of mistakes, which blocks learning and creates organizations that are full of deceit and subterfuge — as with the clients mentioned above.

I have come to believe that a key contributor to this problem is the lack of institutional mechanisms for forgiveness in organizations — specifically, a management system for repentance and forgiveness. Sometimes, a mistake is dealt with by way of immediate dismissal. But typically mistakes ‘go in your file’ and haunt you forever. This is particularly the case in most military organizations where getting ‘written up’ is forever. Consequently, investing effort both proactively (currying favor with those who are in a position to write you up) and reactively (calling in those favors) to avoid getting written up is a much higher priority than trying to figure out what went wrong and adjusting to avoid recurrence. It is a big win to get your mistake characterized as not really a mistake — i.e., that carrier landing wasn’t deficient, it was OK, even if it takes colluding with your superior to make it happen.

World Religions

I think it is interesting to note that the world’s main religions have thoroughly institutionalized processes for forgiveness — dare I say Enabling Management Systems! It is not just Roman Catholicism with its process of confessing one-on-one with a priest, being offered a penance, accepting the penance, and being granted absolution. All the major religions, including Hinduism, Buddhism, Islam, Judaism, and the various branches of Christianity, have well-established and broadly understood (within their faith) processes for repentance and forgiveness. Each has a rationale of the importance of the process — from Buddhism’s view that it is the only way to restore peace to the forgiving party, to Islam’s view that it is the productive alternative to violence, to Judaism’s view that it is obligatory in the face of genuine repentance.

Famously, that was Anglican Bishop Desmond Tutu’s master stroke that shaped South Africa’s Truth and Reconciliation Commission. He created an institutionalized process that brought hidden Apartheid era truths to the surface, provided a public forum for repentance, and offered forgiveness, so there was finally some reconciliation from a terrible, terrible era.

There is a reason for the formality of these repentance and forgiveness systems. They recognize that flawed human beings will always make mistakes, yet in order to promote high aspirations for behaviors in general, you need to describe the behaviors to which you aspire and provide forgiveness for actions that fall short.

When I reflected on that cycle of repentance and forgiveness in all major religions, I came to understand the underlying reason for the high level of duplicity and cover-up in the two Christian fundamentalist businesses mentioned above. Executives in these companies were intimately connected to the repentance/forgiveness cycle in their personal life — they would sin, because no one can avoid sin, but they would repent and be forgiven. They equated mistakes in business with sin in their personal life, but in their business life there was no structure for forgiveness — so they couldn’t admit to a mistake/sin. They had to distance from it, cover it up, shift blame — whatever necessary to escape the unforgiveable mistake/sin.

Four Seasons Hotels & Resorts

When thinking about the desire to hold lofty aspirations but recognize and deal more productively with the inevitability of human frailty, it struck me that the philosophy of Isadore Sharp, the founder of Four Seasons, provides an interesting perspective. The company has the honor of being the biggest, most profitable, highest satisfaction (both guest and employee) luxury hotel chain in the world, recognized widely as embodying the pinnacle of luxury service.

A big part of the success is Sharp’s recognition that no matter how good Four Seasons is, it will make errors. There are too many guest-staff interactions every single day to be perfect. The question is not whether it can eliminate errors in the guest experience (it can’t), but rather what Four Seasons will do when it makes an error? The answer is that Four Seasons has a detailed process for that eventuality — the Glitch Reporting and Service Recovery Process — which includes enforcement of zero recrimination against the person who caused the problem because if there was recrimination, there would be cover up of the glitch and a fix would never be attempted. Instead, Four Seasons does such a great job of identifying and rectifying errors that guests barely remember the error — and by cataloguing mistakes, Four Seasons figures out which are most common and learns how to improve its service quality.

The Characteristics of a System

Insights from how the world religions and Four Seasons handle mistakes can be combined to posit the characteristics of a requisite EMS for mistake management in business.

First, the system should be formal rather than ad hoc. It will have no legitimacy if it is dreamed up and used idiosyncratically after the fact. Many of the best CEOs with whom I have worked practice thoughtful and empathetic forgiveness, and are loved for it, which is one reason they are great. But because forgiveness is often ad hoc, the CEO forgives, but the rest of the organization doesn’t, and will often resent both the CEO and the forgiven person because the broader organization doesn’t understand the CEO’s rationale or the nature of the penance.

Second, the system should be widely understood and broadly applied. This follows in part from the first point — a formal rather than ad hoc system. But just being formal is not enough. It must be thoroughly socialized so that everyone in the organization knows what will happen when a mistake is made. And it must happen in the wake of any mistake. It can’t be applied selectively, or it will lose legitimacy.

Third, it should be applied publicly. I have seen far too many cycles of repentance/forgiveness are conducted in secret, supposedly to benefit those involved. My experience of virtually all of them is that the secrecy benefits no one. It just generates rumors that are worse than the mistake itself — even if it is an embarrassing mistake like bullying or sexual harassment.

Fourth, attention needs to be paid to due process. In most cases, the supervisor will be best positioned to engage with a subordinate about an error and make the determination as to what to do about it. However, when it gets contentious — e.g., the subordinate doesn’t believe a mistake was made — having a third party get involved can be beneficial. The goal is to learn from mistakes and get better. There won’t be learning if the parties don’t believe that due process was followed.

Fifth, the process should encompass both repentance and forgiveness. And repentance needs to include a decision on requisite penance, and the acceptance and service of the penance. With repentance and serving of penance, the precipitating cause needs to be expunged — otherwise it isn’t true forgiveness. If the mistake stays in the person’s file forever, there is no real forgiveness. It may take years to serve the penance — I wholeheartedly endorse probation periods — but at some point, the black mark has to go away. If an executive makes an avoidable mistake that (say) cost the company 20% of the year’s income, then it may take 10 years of probation to get to a clear record. If instead, a salesperson blows one promising lead with a foolish move, but admits the mistake, the penance may involve something minor like closer supervision for six months. In either case, if the record is never going to be cleared then it is much more humane to fire the executive to facilitate the start a new career rather than live under a shadow forever. The system needs to have balance and proportionality — but closure.

Practitioner Insights

It may feel like an organization should not tolerate mistakes in judgment, especially ethical/moral judgment. And I know that I feel that way sometimes. When the egregiousness of the Volkswagen emissions cheating scandal came to light, my initial reaction was that Volkswagen should be banned forever from the US market. But with sober second thought, I realized that wouldn’t have been optimal for society in general.

Forgiveness is important, though one company with which I work just plain doesn’t think so. Its policy is pretty much one strike, and you are out. While it may appear meritorious at some level, I don’t think the company understands the cost of the policy in terms of cover up/subterfuge.

To me, a better alternative is an Enabling Management System for repentance and forgiveness. The system must encompass both because repentance without forgiveness will stop happening, and forgiveness without repentance is largely useless. It takes both.

I know all the atheists out there are not fans of the world’s religions. But they got there and hold their place in the minds of billions for a reason. Each has worked well enough to endure. Business should take a page from their collective books and build an EMS that embraces repentance and forgiveness in order to promote an environment of learning and getting better.

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Roger Martin

Professor Roger Martin is a writer, strategy advisor and in 2017 was named the #1 management thinker in world. He is also former Dean of the Rotman School.