Crisis Mis-Steps: Lessons from Société Générale

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socgen.gifOne of the recurring themes of crisis management is that most harm in a crisis is self-inflicted, either in the first instance or because of a late or weak response, or both.

A second theme is that an effective response is often delayed by predictable mis-steps. Logos Institute has catalogued ten missteps that seem to be the common denominators of mis-handled crises. These ten missteps constitute predictable patterns that can be identified early and overcome, if only you know what to look for. One of these missteps is to ignore a problem that is otherwise evident.

A third theme is that these missteps are often caused or intensified by lack of humility among decision-makers.

These three themes were brought into sharp focus in today’s (Feb. 5, 2008) New York Times, whose business section has a detailed account of the missed warning signs at Société Générale, the French bank where a rogue trader cost the bank more than $7 billion.

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Little Droplets of Humility

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Howard Schultz, Source: AP

“Crisis management is the new black!” A good friend recently shared that revelation with me via email. I had to laugh, not only because I enjoy a witty fashion metaphor, but because I’ve also enjoyed watching crisis management come of age in the public consciousness. Even in this era of distrust and information saturation, people are warming up to the power of the sincere apology – a step toward redemption requiring that dollop of humility my partner Fred Garcia writes about. More and more, people are welcoming the forward arc of emotionally-intelligent, collaborative leadership on a global scale. Absolutely fabulous, I say!

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Humility Update: The New Hampshire Primary

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rt_clinton_emotional3_080109_ms.jpgThank you all for your very thoughtful comments on my post on humility as a leadership attribute.

Today (the day after the New Hampshire primary) I’ve gotten lots of calls and e-mails from people who read my original post, all commenting on Senator Hillary Clinton’s surprise victory in New Hampshire.

As you know, after the Iowa caucuses the conventional wisdom was that Senator Barack Obama, who had captured the women’s vote on his way to overwhelming victory in Iowa, would replicate his triumph in the New Hampshire primary.

Then Senator Clinton had a moment that changed the story. (See the YouTube video of her emotional moment.) Depending on which pundits you listen to, she either had an uncharacteristic moment of authentic vulnerability or a highly-contrived moment of inauthentic vulnerability. But the vulnerability — roundly interpreted as weakness — was seen to have changed the outcome.

It’s probably too soon to know for sure whether the expression of emotion really made such a difference. But it’s very interesting that vulnerability – however authentic it may be – is now seen to have propelled her to the front of the pack.

We’ll keep watching; your comments and reactions are welcomed…

Fred

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A Dollop of Humility

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What are the leadership attributes that contribute to long-term success? That help get through adversity?

I was reflecting on these questions as I put together our year-end review of crises, The Year of Living Self-Destructively. The defining crises of 2007 were all self-inflicted; even where the triggering event was external, the leader’s handling of the crisis only made things worse.

What these crises had in common was this: the leaders who caused the self-inflicted harm exhibited little, if any, humility. Read more

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