Why British companies are so poorly run and why nothing will change.

 

Back in the 70's Subbuteo was big, with 1000's of boys across Britain meeting up with friends to play. I never understood the appeal, so never asked for a set for Christmas or my Birthday. 

As far as I was concerned the game was dull and the pieces cheap tat.

But not everyone felt the same. One Saturday morning a young lad, gripping his box of Subbuteo players arrived at a friends house to have a morning playing the game. He was shown upstairs by his friends mother. When he got upstairs, he found his friend ready. Game set up, a fan blowing down the 'pitch' in his direction, and a light pretending to be the sun shinning in his eyes.

The sun and wind changed direction after half time. The young lad grew up to be a work colleague of mine and the telling of this story was timely. His opponent all those years ago was Fred Goodwin, now better known as Fred the Shred, who's claim to fame (or should I say shame) is that he almost single-handedly destroyed UK banking, certainly badly damaged the UK economy and probably cost Labour the following election.

My colleague claimed it was more a charity visit as Fred didn't really have friends. Well during the 8 years of his pomp, Fred made a load of friends, mainly political and mainly Alex Salmon, who was leader of the SNP at the time . A man so ugly, he has the look of a constipated toad, but seemingly possessing a charisma so strong that, young women flung themselves in his direction. 

Willing to put up with the stink of sweat, cigars and whiskey.

Allegedly.

Desperate to prove that Scotland wasn't simply whiskey and oil, he was overjoyed by Fred's apparent success of turning the RBS into the worlds largest company by assets and to show his gratitude, obtained for him a Knighthood in the 2004 birthday honours list.

The knighthood was cancelled in 2012 and Alex Salmon wriggled free of the accusations of bad judgement by blaming Westminster.

In 2010 Fred became employed as a Senior advisor to RMJM an international architecture firm.

Yes that's right. possibly the most disastrous senior director in British corporate history had got himself a new job. How?

To answer this we need to understand UK corporate culture and how it impacts on how a Company is Managed and by whom.

The first thing you need to understand, to become a Director you don't need to be good at your job. Or even vaguely competent. What you need to do is identify the career you want, find out who would be in charge of that career and then stick to him like a limpet whilst muttering in his ear how wonderful and talented he is. 

In many ways the exact opposite to the Roman Memento mori "remember you have to die",

In addition he or she needs to become the Directors most loyal gofer and spy. There is bitter competition for this position, so not everyone will succeed. 

Whilst this doesn't require any particular level of competence in the job you are nominally paid to do, it does require commitment, long hours and dedication. All good training for when you eventually climb to the top of your particular greasy pole.

Once you had managed to become a member of the golden circle, life becomes a lot easier, but more of that later. To succeed at this level you need to start taking an interest in the requirements of the Directors job. So the typical career of a Director follows a well worn path.

Obtain job. Not by applying, being interviewed, exhibiting competence, but by 'networking'.

Once job obtained leave current employer and enjoy reading company issued e-mail thanking you for your dedication, the changes you have made and expressing sadness at your leaving.

Strangely most of the staff won't give a toss and will appear glad to see the back of him.

Agree a golden goodbye.

Now what the Director needs in his new job is a plan and a strategy. So negotiates budget, identifies gofer, issues instructions. and after 6 months to a year of no obvious activity an action and implementation plan is published.

For the next year committees are set up; training identified, change "Slogan" agreed, usually after the involvement of an expensive graphic design company, which in its turn will suck up half the existing budget.

And a countdown clock to 'Implementation' day planted in reception, with the hope this inspires customers to view the company as up to date and 'dynamic'.

After implementation, CV updated and new job obtained. What the Director doesn't want is to still be around when it all turns to rats. Actually being responsible for the proper success of a project is a step to far. and besides doesn't come with another golden hello.

The last thing the Director will want is the effort required to smooth out wrinkles and major issues and achieve the promised benefits.

Besides his replacement will come up with another plan.                                  

And repeat.

Once your in this golden circle success of a sort is practically guaranteed. Even if you bankrupt the company with the biggest losses in UK corporate history and destroys the UK economy, you don't lose out. Your contacts will get you a new job, and it won't be on minimum wage.

This circle is very tight knit. They work late together, go out to eat together, holiday together and more often then admitted sleep together. Getting access to this circle is difficult, but once there life becomes easy, provided of course you don't really care about family and loved ones.

Of course this leads to a culture of short termism, with a lack of loyalty or commitment to the organisation 

And nothing has changed since the RBS debacle. Few laws or rules have changed, it all could happen again tomorrow. The culture of non responsibility remains the same. Various governments have looked the other way. Incompetence is still rewarded. The man in the street is still being shafted.

And Fred? He enjoys shooting, golf and entertaining. I don't know if he still cheats at Subbuteo but he still enjoys the life most can't even aspire to. And whilst having shafted the tax payer, there is little evidence that he has qualms over his role in destroying the RBS.

Fast forward to today and the Post Office debacle, where innocent sub-postmasters have been wrongly accused of theft and prosecuted as a result of the Horizon scandal which saw shortfalls incorrectly recorded to their branch accounts.

Innocents have been sent to jail. Marriages have failed due to the pressure of the accusation. In bleak despair several committed suicide. All because of a dodgy piece of software that senior management refused to admit existed.

Whole lives destroyed.

Then there was the Equitable life scandal and destroyed pensions, leaving an old age of poverty instead of the promised comfortable one, and an attempted cover up by the management.

Corporate greed, arrogance, indifference leading to destroyed lives, impoverished old age, marriage failures and family breakdowns.

But to date no senior management convicted. Instead the cosy cartel of management continues. Looking after their own, indifferent to the lives they have destroyed. Callous. Arrogant.

Venal.

Even that bastion of corporate greed and capitalist hegemony, the USA, shows more concern to obtain at least some level of justice, by showing willingness to convict.

We should be ashamed.