Managers Not Grounded in Reality
(From the project Dialogues with Julian Moody: On Life, Business, Sustainability, and Other Things by Julian Moody and Brandy Walker)
BRANDY W: You mentioned a common problem you observed with managers was the problem of application. Can you explain?
JULIAN M: Managers with advanced degrees, in particular, had trouble with application. I worked mainly with MBAs, which as you know is an abbreviation for Master of Business Administration. So we could naturally imagine that’s a fairly high degree. They’re very well paid. The ones I worked with knew a great deal about the subject areas they studied. For example, they studied finance, marketing, accounting, management—pretty much every functional area of business, but very often, they had great difficulty with application. Not all of them. Some of them were quite good. But I would say a very large percentage, they would lay out a plan that sounded nice and looked good, but there was no way to apply it. And part of the essentiality in the business world is to be able to apply what you know so that it produces results. But in company after company I was with, when they would hire MBAs, they would come aboard and they would have great difficulty using their knowledge to help the business prosper and grow. All the managers were different, and there may have been different personal reasons why they had trouble with application, but there were some common reasons I observed over and over again. A common scenario—the graduate program and their education has them convinced they’re the expert even though they may have no real world or practical experience in whatever field the company specializes in. For example, they go into a company that has a highly specialized form of manufacturing and they go in there not knowing anything about this manufacturing, but they’re convinced they’re the expert because of their advanced business degree. They come up with plans that doesn’t take into consideration practical details which they try to impose onto the company. As you can imagine, this often ended up being very unproductive. So they wasted the company’s time and money.
BW: It sounds like they’re not grounded in reality
JM: Right. So often they couldn’t apply anything on a practical level because they’re not grounded in any kind of practical knowledge. And because of arrogance or embarrassment, they don’t want to reveal their ignorance because they’re supposed to be the expert. In both cases, we’ve got pride. So all of this results in a disconnection from reality. A lack of grounding in reality. These managers said things that were impressive and they came up with ideas or plans that sounded good and made everyone feel good for awhile, but there was no grounding in reality. And all of this can be made much worse if these managers have personal agendas involving ego and greed. Very often many factors are at work. It’s a complex issue which we have to split apart into separate topics in order to discuss it, but generally, they’re all connected. And fundamentally, it all comes down to an issue of pride.
BW: It sounds like you saw, in general, a milder, garden-variety version of that arrogance or disconnection from reality which was extreme, pathological in Enron. Skilling believed the idea was the only thing that mattered and the sole source of profit. That superior people came up with the ideas and that they can’t be bothered with the practical details. That was for inferior people to handle. Enron obviously fell on many swords, but this belief and attitude was one of the major causes of their downfall.
JM: Yeah, there’s definitely an unspoken elitism. People in management with the advanced degrees come up with the ideas, but they can’t be bothered with the everyday, practical details. Or some of these people may simply be so overeducated they have lost common sense.
BW: It’s important to have vision and use your imagination and come up ideas—creation begins in imagination—but at the same time, there needs to be a strong grounding in day-to-day reality. So good planning and application is a balance of these two qualities? Having vision but at the same time being grounded in reality?
JM: Yes, definitely. And a very important part of the grounding aspect is focusing on reality as much as you can. If you’re constantly striving to see what’s real, that’s a very important factor.
BW: I have met people who are not grounded and in comparison, what I feel and sense from just being around you is that you are very solid and grounded. And I attribute your groundedness to the fact that you have had a lot of life experiences, you’ve had many jobs, all sorts of humble, ordinary jobs. You’ve worked in landscaping, you’ve washed dishes, you worked in a rug department. In other words, you got your hands dirty. And I’m just using this as an analogy or a metaphor—when I think of somebody who is grounded, I think of something like farming and gardening. I think of someone who has a realistic sense of how long it takes to prepare the ground, plant something, how long it’s going to take for something to grow, and all the possible problems that may occur between the time from planting to harvest. And so I see groundedness as having that kind of direct connection to the earth, the reality of what it takes to make something happen, to make something grow. And so being grounded I feel has a lot to do with humility. The words “humility” and “humble” comes from the same root word as “humus” which means “earth, ground, soil.”
JM: Right. It’s about being humble. Having humility. Anyone with practical knowledge—meaning knowledge based on hands on experience—not always, but generally, has a natural humility. With practical knowledge and experience comes a certain kind of humility. And when you’ve been knocked around by life, you’re likely going to have humility. But it’s very important to point out—you generally can’t cultivate humility. Humility is one of the most difficult things in life. The challenge is that humility is not a skill that you learn in, say an academic setting, like you learn other skills. Otherwise it wouldn’t be humility, if you could accomplish it. There’s a catch-22 in it, in that sense. You can’t become “better” at humility—that’s really just more pride. So humility in a practical context, say in the business world, I would say is an openness that is hard to describe. It’s letting go of preconceived notions. You can’t have an overconfidence in book knowledge or theories or advanced degrees. Or even your own experience. It’s the awareness, I don’t know everything. If you’re basically most of the time saying to yourself, “I don’t know” and therefore you’re seeking. It is being very humble, saying to yourself, “I don’t know.” For example, I worked with seven different banks. I worked with Santa Barbara Bank and Trust for twenty years. The other banks, I worked with each for several years. But I can sit here and say, I don’t know banking. I know a lot about it in some ways. And if another bank wanted me to come in and work with them, I would start out not knowing because how they operate—even though they’re a bank—depends on the fact that they’re different people. And so not knowing to me is a very important part of my approach. It’s a willingness to be foolish. Because it puts me in a position of not only humility, but in a position of curiosity and searching.
BW: You go in with an open mind.
JM: Very much. And with the basic attitude that I don’t know. I don’t care how many presidents I’ve worked with, if I start working with another one tomorrow, I have to say, “I don’t know him.” That’s the key. You really need to be a fool in a sense. But to clarify, it’s not low self-esteem, like I’m not worth anything or capable of anything. It’s an open state versus an arrogant, know-it-all, I’m the expert attitude and agenda. It’s a willingness to learn. If you are truly going to help a company, you have to be willing to learn. And it takes humility and patience to do that. A willingness to listen to somebody else’s viewpoint, learn about something you don’t know. What’s really going on? What are the needs of the company and the people in the company? What are the needs of the people in the market? A willingness to become grounded is a willingness to listen and learn. A willingness to admit you don’t know everything and that you aren’t always right. A willingness to consider other people’s perspectives and needs versus just looking out for yourself, imposing an agenda, trying to be the winner and a star or hero of the situation. Like, “I’m going to come up with some grand plan and be proclaimed the hero of the hour.” Our egos want to be the hero of the hour. But heroism is often the opposite of what we think. It’s service, a sense of servitude. Looking out for others. Unfortunately, many managers aren’t willing to be grounded in this way. And it’s so contrary to the way we’re often trained and educated.
BRANDY W: You mentioned a common problem you observed with managers was the problem of application. Can you explain?
JULIAN M: Managers with advanced degrees, in particular, had trouble with application. I worked mainly with MBAs, which as you know is an abbreviation for Master of Business Administration. So we could naturally imagine that’s a fairly high degree. They’re very well paid. The ones I worked with knew a great deal about the subject areas they studied. For example, they studied finance, marketing, accounting, management—pretty much every functional area of business, but very often, they had great difficulty with application. Not all of them. Some of them were quite good. But I would say a very large percentage, they would lay out a plan that sounded nice and looked good, but there was no way to apply it. And part of the essentiality in the business world is to be able to apply what you know so that it produces results. But in company after company I was with, when they would hire MBAs, they would come aboard and they would have great difficulty using their knowledge to help the business prosper and grow. All the managers were different, and there may have been different personal reasons why they had trouble with application, but there were some common reasons I observed over and over again. A common scenario—the graduate program and their education has them convinced they’re the expert even though they may have no real world or practical experience in whatever field the company specializes in. For example, they go into a company that has a highly specialized form of manufacturing and they go in there not knowing anything about this manufacturing, but they’re convinced they’re the expert because of their advanced business degree. They come up with plans that doesn’t take into consideration practical details which they try to impose onto the company. As you can imagine, this often ended up being very unproductive. So they wasted the company’s time and money.
BW: It sounds like they’re not grounded in reality
JM: Right. So often they couldn’t apply anything on a practical level because they’re not grounded in any kind of practical knowledge. And because of arrogance or embarrassment, they don’t want to reveal their ignorance because they’re supposed to be the expert. In both cases, we’ve got pride. So all of this results in a disconnection from reality. A lack of grounding in reality. These managers said things that were impressive and they came up with ideas or plans that sounded good and made everyone feel good for awhile, but there was no grounding in reality. And all of this can be made much worse if these managers have personal agendas involving ego and greed. Very often many factors are at work. It’s a complex issue which we have to split apart into separate topics in order to discuss it, but generally, they’re all connected. And fundamentally, it all comes down to an issue of pride.
BW: It sounds like you saw, in general, a milder, garden-variety version of that arrogance or disconnection from reality which was extreme, pathological in Enron. Skilling believed the idea was the only thing that mattered and the sole source of profit. That superior people came up with the ideas and that they can’t be bothered with the practical details. That was for inferior people to handle. Enron obviously fell on many swords, but this belief and attitude was one of the major causes of their downfall.
JM: Yeah, there’s definitely an unspoken elitism. People in management with the advanced degrees come up with the ideas, but they can’t be bothered with the everyday, practical details. Or some of these people may simply be so overeducated they have lost common sense.
BW: It’s important to have vision and use your imagination and come up ideas—creation begins in imagination—but at the same time, there needs to be a strong grounding in day-to-day reality. So good planning and application is a balance of these two qualities? Having vision but at the same time being grounded in reality?
JM: Yes, definitely. And a very important part of the grounding aspect is focusing on reality as much as you can. If you’re constantly striving to see what’s real, that’s a very important factor.
BW: I have met people who are not grounded and in comparison, what I feel and sense from just being around you is that you are very solid and grounded. And I attribute your groundedness to the fact that you have had a lot of life experiences, you’ve had many jobs, all sorts of humble, ordinary jobs. You’ve worked in landscaping, you’ve washed dishes, you worked in a rug department. In other words, you got your hands dirty. And I’m just using this as an analogy or a metaphor—when I think of somebody who is grounded, I think of something like farming and gardening. I think of someone who has a realistic sense of how long it takes to prepare the ground, plant something, how long it’s going to take for something to grow, and all the possible problems that may occur between the time from planting to harvest. And so I see groundedness as having that kind of direct connection to the earth, the reality of what it takes to make something happen, to make something grow. And so being grounded I feel has a lot to do with humility. The words “humility” and “humble” comes from the same root word as “humus” which means “earth, ground, soil.”
JM: Right. It’s about being humble. Having humility. Anyone with practical knowledge—meaning knowledge based on hands on experience—not always, but generally, has a natural humility. With practical knowledge and experience comes a certain kind of humility. And when you’ve been knocked around by life, you’re likely going to have humility. But it’s very important to point out—you generally can’t cultivate humility. Humility is one of the most difficult things in life. The challenge is that humility is not a skill that you learn in, say an academic setting, like you learn other skills. Otherwise it wouldn’t be humility, if you could accomplish it. There’s a catch-22 in it, in that sense. You can’t become “better” at humility—that’s really just more pride. So humility in a practical context, say in the business world, I would say is an openness that is hard to describe. It’s letting go of preconceived notions. You can’t have an overconfidence in book knowledge or theories or advanced degrees. Or even your own experience. It’s the awareness, I don’t know everything. If you’re basically most of the time saying to yourself, “I don’t know” and therefore you’re seeking. It is being very humble, saying to yourself, “I don’t know.” For example, I worked with seven different banks. I worked with Santa Barbara Bank and Trust for twenty years. The other banks, I worked with each for several years. But I can sit here and say, I don’t know banking. I know a lot about it in some ways. And if another bank wanted me to come in and work with them, I would start out not knowing because how they operate—even though they’re a bank—depends on the fact that they’re different people. And so not knowing to me is a very important part of my approach. It’s a willingness to be foolish. Because it puts me in a position of not only humility, but in a position of curiosity and searching.
BW: You go in with an open mind.
JM: Very much. And with the basic attitude that I don’t know. I don’t care how many presidents I’ve worked with, if I start working with another one tomorrow, I have to say, “I don’t know him.” That’s the key. You really need to be a fool in a sense. But to clarify, it’s not low self-esteem, like I’m not worth anything or capable of anything. It’s an open state versus an arrogant, know-it-all, I’m the expert attitude and agenda. It’s a willingness to learn. If you are truly going to help a company, you have to be willing to learn. And it takes humility and patience to do that. A willingness to listen to somebody else’s viewpoint, learn about something you don’t know. What’s really going on? What are the needs of the company and the people in the company? What are the needs of the people in the market? A willingness to become grounded is a willingness to listen and learn. A willingness to admit you don’t know everything and that you aren’t always right. A willingness to consider other people’s perspectives and needs versus just looking out for yourself, imposing an agenda, trying to be the winner and a star or hero of the situation. Like, “I’m going to come up with some grand plan and be proclaimed the hero of the hour.” Our egos want to be the hero of the hour. But heroism is often the opposite of what we think. It’s service, a sense of servitude. Looking out for others. Unfortunately, many managers aren’t willing to be grounded in this way. And it’s so contrary to the way we’re often trained and educated.