2012 Series 003 – Meritocracy, Objectivity, and the Selfless Leader.

In my post on Meritocracy & Objectivity, I state that without Objectivity, the good intentioned logically sound meritocracy criteria can still be used to justify dysfunctional culture.

Some say that by asking “why” for 3 times, we might arrive at the root of an insight. So now we try to ask why 3 times. We asked “what are the components of meritocracy?”, we then asked “what meta criteria is important in meritocracy?”, now we ask “how do we achieve that meta criteria, i.e. objectivity?”

Easily from the title, Selflessness is key to achieve objectivity.

Let’s start by understanding the antithesis of Selflessness and how it prevents objectivity, and then we will proceed with how Selflessness allows objectivity.

The antithesis of Selflessness is Selfishness. Ego being allowed to thrive, materialize, and grow.

Ego destroys Objectivity, and it does this in 4 ways:

a. It allows cognitive biases to continue.

Unbridled ego allows a man to keep selecting information that support he believes, and prevents him from reading information that doesn’t support his believe. He/she simply could not hear things that are not congruent to his/her beliefs. The Egoistic man, the selfish man, finds what he thinks to be true, his ego reinforce his finding, certifies his finding, it even bring his finding home and put that “I am Right” on plaque and frame it on the bedroom wall to be seen every morning. Due to his ego, the selfish man cannot seek, hear, and process information that go against his thought and logic pattern, the selfish man loses objectivity.

b. It allows heart biases to flourish.

Heart biases happen when a man’s feeling heavily influence his worldview and decision making. He is prompted to do things and make decisions with his feelings being a more dominant factor. Someone hurts his ego, he feels shame, pain, and anger, and then, he Acted on these feelings. This behavior is truly childlike, but adults can have this behavior too, the only difference is adults have learned to do masking activities to hide what he feels.

But the adult can still succumbs to his feeling, inwardly, and make decision, silently secretly covertly, based on his feeling.

When we put this in a corporate context, where shareholder value and jobs are at stake, the consequences of inwardly childlike leader are harrowing.

Furthermore, not only he makes decision based on what he feels, the reasoning part is gone when he make this decision, or even helping him to develop justification for his decision.

A selfish leader is unaware of his/heart biases and how easy these biases destroy objectivity.

c. As the heart biases interact with the cognitive biases, they both reinforce each other.

Heart biases reinforce cognitive biases through prejudice, Cognitive biases reinforce heart biases through reasoning and paranoia.

When a selfish leaders is emotionally disturbed, his mind gather evidence to support his thinking process. Words are re-interpreted, body language are scrutinized.

When a selfish leaders is intellectually challenged by his team, his heart whispers to his mind, whispers of generalization, whispers of ad hominen arguments.

As the heart biases interact with the cognitive biases, objectivity cannot enter the leader’s heart and mind.

d. Ego prevents the selfish man to understand that he is selfish.

Ego covers the selfish man like sea waters covers a fish. It is totally surrounding him, but he cannot see it, for it is, his reality.

360 feedback at the office, feedback from a spouse, the honest words of a child. The selfish man finds feedback on his selfishness to be utterly ridiculous, No, he is simply not.

“None are more hopelessly enslave than those who falsely believe they are free” Goethe

We explored 4 ways in which a selfish man’s ego prevents him to objective, now, let’s move to how the lack of ego of a selfless man would make him objective.

The selfless man lack of ego allows him/her to be objective in 4 ways:

1. He allows others to show him himself

The selfless man lack of ego allows him to seek, hear, process, and accept feedback. Cognitive and heart biases are held at bay, and truth comes in.

As truth comes in about himself, he identifies things inside him that are un-truth, biases.

His lack of ego, allows him to understand how he can be –unobjective. It then allows a higher want, the want to be objective, to surface.

The interaction between the mind and the heart are now one that leads to higher ground, the willingness to be objective and the finding that he is un-objective.

2. He forgives

Instantly, immediately, like zero second after a wrong remark was said, either intentionally or unintentionally.

And by forgiving, his mind can stay on the issue, properly analyze the issue, correctly analyze the issue, minimizing biases,

he makes better analysis , analysis that considers all data, even from those that offended him

he reach better conclusion, conclusion that test assumptions and implication, even those that are not his own

and he make better decisions, decision that meets other’s interest, not just himself.

His understanding that he is un-objective and prone to further objectivity asked him to focus on objectivity.

3. He can take a distance from himself

By not needing to satisfy and feeds his ego all the time, the selfless man can put his ego to rest, and can take a distance to have a good look at his ego and himself.

As he can take a distance from himself, he can then do a magical thing, see the world from someone else’s point of view.

Now, the strength of his vision and insight is multiplied, whereas the selfish man has only 1 pair of eyes, his eyes, the unselfish man can have as many pair of eyes as deadline permitted.

His selflessness enables him to ask “how would you see this?”, “how do you see this?”, “what do you think is there?”.

He is objective not only because the ground where he used to stand is now clear with unobstructed view, but also because he can stand on other grounds as well.

4. He questions

As the above suggested, the selfless man are free to ask.

He has no ego that hankers to him, “stop asking, don’t ask, what if you found that you are wrong?”

The chains that prevent the selfish man to wander had been crushed, and the selfless man can go to any vantage points as he pleases.

Not only he can stand from another person’s ground and see their worldview, he can now ask his own assumptions, he can question other assumptions.

Identifying assumptions is easier for the selfless man.

And as he identify and question assumptions after assumptions after assumptions, the selfless man stand ever more consistent on the point of objectivity.

Meritocracy, objectivity, selflessness.

Let’s pursue and grow selfless leaders in our organizations,

for their considerations would be objective,

they would be trusted by their team, not just the “I think you’re a good man” trust, but also the “I think there’s a better way to do this” trust,

and meritocracy would be actively sought, tested, and assured.

Advertisements

2012 Series 002 – Meritocracy & Objectivity

In my last post, I state that Meritocracy is very important and yet, although the definition of meritocracy is well documented, the nature or criteria for meritocracy is open to each organization.

I also state that thus, the nature or criteria of meritocracy selected by an Organization is critical, have the right components of meritocracy and your organization can be sustainable, have the wrong one, and you have apathy and the poisons that comes with it.

So, now we face a question. How do you determine that a criteria for meritocracy is good? A sort of meta criteria.

In this post, I like to argue that the most important criteria in defining the components of meritocracy is Objectivity.

We know that the human mind and heart has a penchant for biases.

Biases to prefer information that support our believes instead of those that challenges them.

Biases to give more weight to information coming from sources that look more attractive or affable or have authority.

All kinds of Cognitive biases interfering with how we view the world, perceive other’s actions, develop response, and execute our response.

But wait, isn’t the criteria of meritocracy can be deduce by common sense? Wouldn’t logic prevail when we set our criteria for meritocracy?

Unfortunately no.

We define our world base on what we believe. And due to our biases, our believes can be completely farce and yet still seem entirely logical for us.

Example, both Atheist and religious people can point the universe as proof of their believe, each thinking that their believe is entirely logical based on the facts they see. Yet if the facts are truly the same, and people arrive at different conclusion, then there’s must be a believe system that “guide” people towards a conclusion.

I have witnessed a company leader thinking she had adhered at principles of meritocracy, while all she was doing was surrounding her self with people she feel comfortable.

For her, these people had shown meritocracy, they had deliver the business volume she requested, they had shown loyalty to her, they support her ideas, they do her tidings eagerly, they even seem to be in the same wavelength with her, some are indeed very clever people. In her mind, the concept that she is doing meritocracy is completely wholesome.

But outsiders, who doesn’t share her worldview, be it consultants or N2 or N3 management layers, see people who delivers volume at the expense of value, people who are not willing to tell the truth, people who are unimaginative, people who would let the company sink to get ahead, are those that get promoted.

Can one imagine, what the company culture is like?

But she totally, totally, believe that she applied meritocracy in a logical manner. Aren’t the criteria she choose for meritocracy good criteria? Deliver results, Loyalty, Harmony.

Without Objectivity, these words can be so wrong.

He who knows others, are wise

He who knows himself, has insight

2012 Series 001 – What is Meritocracy?

I think this is among the chief value of an ever growing, ever relevant organization.

Meritocracy pushes people to outdo themselves through productivity and innovation. But with the wrong application, it can also lead people to a sense of resignation and futility.

Due to it’s value, should we start with a definition?

http://oxforddictionaries.com/definition/meritocracy

meritocracy:

1. a society governed by people selected according to merit

2. a ruling or influential class of educated or able people

Wikipedia add an interesting comment on meritocracy:

“Supporters of meritocracies do not necessarily agree on the nature of “merit”, however they tend to agree that “merit” itself should be a primary consideration during evaluation.”

In light of the above definitions, there are at least 2 aspects of meritocracy that needs to be understood and shared:

1. What are the general nature or criteria merit will be applied throughout the organization? Will we even need a general organization wide merit criteria? Or do we think our organization is so diverse, a general criteria of merit will be so ambitious and ambiguous, it become useless.

2. Certain things are unfortunately are given at birth, e.g. intelligence. How do find and include merit criteria that our people can control? And help our talent to focus and believe that merit is an open game for everyone with the motivation to grow? For an Organization where talent feels constrained, that they cannot make a difference, either for the company, their career, or themselves, is in danger of dealing with apathy.

Economic Crisis as a Purging Mechanism

With the current interest rate base economic system, where an amount of interest is applied to any kind of debt, economic crisis is Inevitable.

No, it is Inevitable. Growth cannot help countries escape debt, it is wrong to assume that growth can outpace interest. Impossible, for the banks will always charge an interest rate that is higher than the economic growth rate.

It is the side effect of growth that allows debt to be repaid, inflation.

Inflation allows government, individuals, and corporations to pay debt that is growing faster than the economy.

So in effect, by allowing inflation to take place, government is saying “go f yourself” to the banks who disburse debts in the government’s currency.

But what happens when the rate of inflation is less than the interest rate the bank is giving to the government, individuals, and corporations?

Again, it is literally impossible for all, and truly all, of these debts to be paid in full, since the interest rate being charged is almost always higher than the economic growth rate.

It’s like asking a runner to wound a rope that is being unfurled by a horse drawn carriage. The carriage will almost always unfurl rope faster than the runner can wound them.

So, what happens?

Crisis happens.

It starts with credit crisis. Mortgage crisis is the main culprit. Why? Because there are always less than smart bankers who dare to assume that property can only perpetually increase in value, then when that assumption is proven as what it truly are, the less than smart bankers got burned, starting a credit crisis.

A slight detour. Actually, all smart bankers know that the interest rate base economy is unsustainable, but as long as everybody (the central banks, the governments, the corporation) are willing to play this charade, then smart bankers are more than happy to facilitate this musical chair game. For it is a musical chair, for when the music ends (everyone ask for the get paid) there really aren’t enough chairs for all the players to sit on (interest is almost always higher than economic growth). So, if you are banker, and you are reading this, let us understand that the industry we are in, at it current state is always a game of musical chair, always be ready to hear those telltale signals of when the music is about to end (hint, the music ends when the ratio of players to chairs become to high).

But wait, why do everybody willing to play the musical chair game? Greed. Greed in the form of wanting profit with zero risk. Interest rates are basically that, guaranteed profit with zero risk. Since depositors themselves want profit without risk, the banks’ charge profit without risk to borrowers. Where the accumulated burden of interest going faster than the economy can no longer be sustained, the music stops, crisis happens, and everybody ended up losing money that is not supposed there to begin with.

So, in “real” economy, crisis is inevitable since the interest rate being charged by banks is almost always higher than the economic growth.

How about in the “virtual” economy, the world of Wall Street where money can magically appear from money. No goods are made, no labor are paid (not that much to justify all the money being made), no real services are rendered, yet there are numbers being added to other numbers in a computer screen.

And the silliest thing is, these numbers in computer screen can then be redeemed at full value with real goods and services. So as a result of me doing a leverage bet on the soybean index, I can then take the proceeds of that bet to a car dealership and buy a real physical space occupying car.

It’s like me playing video games, getting all these video game money, then my bank agree to give me hard currency in exchange of the video game money, then I buy real goods and services.

Imagine if there’s tens or hundreds of thousands of video game players, all making these video game money, all sitting there pretty believing the video game money can be exchange at face value to hard currency.

How can the world not face a problem when all these video game money is fully convertible to hard currency?

Imagine the vast ness of wealth that can be made in videogame land, it’s a virtual land, there’s no limit to the wealth that can be made in videogame land, no labor that needs to sleep, no steel that is finite in amount, no oil that is also finite. Videogame land, Wall Street land, is boundless for it is virtual.

Thus when governments allow videogame money to be fully convertible to real money, big problem happens. Investment banking holding more oil reserves than the US Government. Naturally it can, for the investment banking firm lives in videogame land.

Let’s try to imagine, if tomorrow, all the investment bankers decide to liquidate their portfolio , exchange it with hard currency, and then buy real property, goods, and services with the money earned from video game land. There could be not enough real property, goods, and services to trade all this money with. And yet all this money is created without producing real goods and services.

So when in “real” economy, greed prompts people to make profit without risks, yet still producing some goods and services. In video game land, greed squared prompts people to make profits without producing goods and services.

In video game land, as greed squared, the game of musical chair is also squared. If we believe that it’s impossible for all debt to be paid since interest rate is higher than economic growth, what would happen to money made in video game land, where money grows faster than, nothing, it’s based on static money in computer screens.

So in video game land, crisis is both more Inevitable and stronger when it hits, since the amount of silliness that needs to be cleansed is also squared.

So, we can conclude that economic crisis is a purging system, both for silliness that is being made in the real economy, and the silliness being made in videogame land.

The silliness is illusion money, money that is not represented by real production of goods and services, money that is being made through interest that is higher than economic growth and being made on bets at videogame land, money that really isn’t there in the first place.

But wait, doesn’t government always step in crisis?

Yes they do, and by doing that, they prevent the purging process that was supposed to happen and allow past silliness to remain in the system, whereupon this past silliness will be given compounded interest to become even more silliness.

What then will happen? Then the mother of all reckoning will come forth. Bankruptcy.

When a government closed it’s eyes for too long, it will find itself simply unable to pay the debt that has been growing faster than it’s economy.

Witness this quote from the New York Times ““Portugal’s debt is just not sustainable,” said David Bencek, an analyst at the Kiel Institute for the World Economy, a research organization in Germany. “The real economy does not have the structure to grow in the future and thus will not be able to pay back its debt in the long run.”

Source: http://www.nytimes.com/2012/02/15/business/global/portugals-debt-efforts-may-be-a-warning-for-greece.html?ref=business

In this example, it is Portugal that is meeting the mother of all reckoning, actually, no, it is Portugal’s debtors that is meeting the mother of all reckoning. The banks and institutions that has been lending to Portugal has been claiming this revenue that simply doesn’t exist, and now, the banks and institutions are going to be force to wipe off this doesn’t-exist-from-the-first-place revenue from their books.

The question is, with IMF playing firefighters in the last 3 decades, will the same fate meet all world governments?

Save for maybe Germany and the Scandinavians.

Ponder and identify the market opportunities that unfolds as chaos furls upon the known economic system.