May 7, 2004 Another Way of Thinking

We talk to many business people who continue to talk about the dilemma between making money or creating a positive work environment; between making numbers today or investing in the future. Leadership (and success for that matter) is clearly about doing both-making money and creating a positive work environment; achieving today's objectives and ensuring that results will continue to flow in the future. And is that ever difficult to do.

Some people's best accomplishments are achieved when they replace "or" with "and" thinking. Take a common expense control predicament many businesses face today-effectively managing health care costs. How might you approach this dilemma differently if your goal is to keep every one on the payroll and keep your current level of health care coverage, rather than settling for a cutback in either? "And-thinking" stimulates new and innovative ways of thinking about things. It does not guarantee 100% success, but it does provide more and better options to consider in solving really tough problems.

Too often, we come across people in management positions who either don't know how, or are just unwilling to put forth the effort to deal with many of these perplexing problems. And, their shortcomings become very pronounced in tough times. They behave as if they believe that a company can only survive by sacrificing one or many essential things. For many, their only option seems to be to cut their way to greatness.

So, when business starts to slump, they are convinced that the only hope for making a profit is to cut payroll expenses or investment in any kind of new technology or equipment. They see the world as a series of "either - or" alternatives. Every dollar invested in employees is one less dollar returned to shareowners. And the owners are the most important stakeholder. So, you either satisfy those investors or you satisfy the workers, but you can't do both-at least very well.

Do you know people who think like this? Do you work for one? Are you one of them yourself?

Fortunately, there are some who choose to find victory on both sides of the equation. Even in tough times, they find ways to continue to offer customers good prices, but not by literally squeezing the life out of their suppliers. They believe there are ways to provide good returns to the owners and a great place to work for their associates. They work hard at finding those solutions.

Can you think of individual leaders or companies that behave like this? One example that comes to mind is Southwest Airlines.

Think about it. How would you like to be in the airline business today? Like most industries, the airlines have certainly felt the pains of a lethargic economy. More so than many other businesses, they have also been hit harder by the crushing blow of September 11, 2001. Based on the bankruptcy filings over the past couple of years, and dwindling profits from those continuing to fly, it is an industry struggling to survive.

Yet Southwest has continued to soar, both in daily operations and bottom line performance. And they continue to be recognized as one of the best places in the country to work. Now, how can that be? Last I looked, they still offered terrific prices to their customers, good wages and benefits to their workers, and fair returns to their investors. (In fact, over the past 30 years, Southwest Airlines was one of the top companies for creating wealth for its shareowners.)

My guess is they continue to have a high degree of "and" thinking in the business. That thinking may have come from an crisis early in their history. At that time, they were running out of money and had to sell an airplane to raise cash. (They only owned four at the time.) They did indeed sell the airplane, and figured out how to continue offering the exact schedule they had before, rather than cutting their flights by 25%. That kind of innovative thinking has served them very well over the years.

Realistically, it is a fact of life that in order to survive, companies do have to let people go or delay investing in the right things for the longer term. Those are always very difficult and painful decisions. Hopefully, they are made after thoughtful discussions and debates on a wide variety of different alternatives, vs. the consideration of either one option or one other. Although work is very challenging these days, there is usually more than one reasonable solution to any given problem. Do not force yourself into a corner by succumbing to the immediate lure of accepting either one thing or the other, when both are truly desirable. Put forth the kind of thinking and effort needed to obtain both. It is indeed tough work, but it can pay great dividends.

Reflection Questions:

1. How do you currently go about developing different solution alternatives for the tough problems facing you and your team?