In the October 21, Wall Street Journal, there was an article entitled “Japan Post Goes in New Direction.” Reporters Atsuko Fukase and Allison Tudor reported on a change in leadership and the potential reversal of the government’s commitment to privatization.  As they described the unfolding situation, they cite a statement from the chairman of the Japanese Bankers Association, who stated that he believed that private banks would face unfair competition from a government-owned Japan Post that offers banking services.

If this sounds like the concern expressed about the “public option” U.S. health insurance reform proposal, there is a good reason: the issues are remarkably similar.  In the U.S., the U.S. Postal Service has largely avoided competition with the private sector, except in the area of package delivery, in which it competes with UPS and FedEx, express mail, in which it also competes with these same companies, and international mail, in which it competes with DHL, and, more recently, Pitney Bowes.

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A lot has been written about Ken Lewis, the Bank of America CEO, since he announced his decision to retire the week of September 28. Many of the commentaries on him were highly critical, including one included in the Sunday, October 3, New York Times business section by Joe Nocera entitled “Incompetent? No, Just Not a Leader.” Nocera contrasted Lewis, whom I succeeded as Chairman of the National Urban League Board of Trustees in 2002, and who was an exceptionally capable chairman, with his precedessor at the Bank of America, Hugh McColl, whom he described as “born to be a leader.”  I disagree fundamentally with the “born leader” theory.

Every leader does some things very well, and other things less well.  Whether he or she succeeds depends on two factors:

• How well do the capabilities required for a leadership position match the leader’s capabilities?
• How well did the leader either adapt or complement his or her capabilities in areas in which he or she was deficient?

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Because September is the one-year anniversary of the worldwide financial meltdown, there were many good articles in the various newspapers and magazines over the last few weeks.

One particularly insightful article appeared in the September 14, 2009, issue of  The New Yorker, entitled “Eight Days” by James Stewart. It highlighted three root causes that ended up building destructively on one another:

• Excessively high debt leverage among many players in the financial services system;
• Rapid asset sales driven either by panic or sophisticated profit-driven short selling; and
• Provisions in credit agreements that triggered defaults based on accounting-driven asset valuations.

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In the September 7, 2009, issue of the New York Times, reporter Michael Lud wrote an article entitled “Out of Work and Too Down to Search On,” which essentially made the point that the economic environment is so bad that many people stop looking for work.

Unemployment is psychologically devastating.  I know: I was unemployed for several months in early 1979, when I left my law firm and was trying to secure another legal position.  I was asked to look for another job because I was told I would not be made a partner.  My stay on the unemployment rolls was brief, but terrifying.  As a result, I empathize with anyone who has lost his or her job.

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Every so often, I go back and reread a book I liked a lot.  Recently, I re-read a book by Bill Russell, my favorite all-time athlete, entitled Russell Rules.  To me, Bill Russell is the greatest team sport athlete of all time, simply because his teams won the most championships. As a college player at the University of San Francisco, he was the star of two successive NCAA championship teams.  He was a star on the 1956 Gold Medal Olympic team.  As a Boston Celtic, he played for 13 seasons, and the Celtics were champions 11 of those years, including 8 in a row between 1959 and 1966.  In the two years the Celtics did not win, he was injured in the championship series against the St. Louis Hawks in 1958, and lost to one of the great teams of all time, the 1966-1967 Philadelphia 76ers led by Wilt Chamberlain.  Michael Jordan may or may not have had better talent as a basketball player, but even his record was not as exceptional in terms of helping his team win championships.

The reason I think Bill Russell is sometimes not rated as highly as Michael Jordan, Wilt Chamberlain, Kareem Abdul-Jabbar, Magic Johnson, or  even Shaquille O’Neill by many experts is the way he went about winning.  In chapter 5 of Russell Rules, he refers to the value of “invisibility.”  The way he characterizes it,

“Invisibility opens doors, creates opportunity, where none seemed to exist before.  When we are unseen, we have an enormous advantage in moving in, doing things we wish or need to do, and in the process, to change the very dynamic of existing, seemingly closed, patterns.”

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Bob Herbert published an Op-Ed piece in the Saturday, July 11 New York Times entitled “The Human Equation,” in which he takes the Obama administration to task for not being more aggressive in addressing the unemployment crisis in this country.  He says:

“I’d like to see the president go on television and, in a dramatic demonstration of real leadership, announce a plan geared toward increasing employment that is both big and visionary – something on the scale of the Manhattan Project, or the interstate highway program, or the Apollo spaceflight initiative.”

He goes to propose a “Rebuild America” campaign to put people to work rebuilding infrastructure, including roads, schools, electric power grids, and mass transportation. 

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I read an interesting and insightful  article online called “Hired! Turning a Demotion into a Promotion”  which is accessible at http://money.cnn.com/2009/07/10/news/economy/_demotion/index.htm?postversion=200907.

The main point of the article is that individuals need to rethink their strategies for securing new employment, and, in many instances, need to accept a lower-paid position in a different kind of organization with a different career path, compared with the firm that laid them off.  I can relate to this to some extent.  When I was not selected as a partner in the law firm for which I worked in 1978, I was essentially told that I needed to look for another job.  While I was not immediately laid off, my position was eliminated, and I eventually moved into a status in which I was no longer in full-time employment, but was paid only by the hour for the work I did.

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Both Gladwell and Colvin understand that great talent, by itself, is insufficient.  Both extol the value of sustained practice and discipline, with Colvin describing that sustained effort as “deliberative practice.”  Gladwell goes a step further and identifies environmental and marketplace conditions that enable some individuals and organizations to succeed when others of comparable talent and discipline fail.

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The June, 2009, issue of The Atlantic Monthly had a provocative article entitled “Do CEOs Matter?” by reporter Harris Collingwood. What prompted it was the recent story about the leave of absence taken by Steve Jobs of Apple Computer and the stock market reaction to stories by Jobs’ health problems.

As a former CEO, and as a student of leadership in business and other sectors of our country, I believe that individual leaders matters at all times, but in varying degrees at different times and under different circumstances.  Certainly, at particular points in an organization’s history, there are crises that demand unique leadership capabilities.  For example, I cannot imagine that IBM or Xerox would have survived the threats to their survival in the 1990’s without the inspired leadership of Lou Gerstner and, in Xerox’s case, the inspired leadership of my good friend Ann Mulcahy.

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In an Op-Ed piece in the Tuesday, May 12, issue of The Wall Street Journal,   entitled “Schumer’s Shareholder Bill Misses the Mark,” attorneys Martin Lipton, Jay Lorsch, and Theodore Mirvis accurately and insightfully point out the fundamental flaws in the shareholder rights legislation proposed by Senator Chuck Schumer.

Senator Schumer ’s bill is designed to override state corporation laws that vest the primary power for leading any state-chartered corporation to its board of directors.  In a number of ways, including banning staggered boards of directors and reducing barriers to shareholders nominating their own candidates for directors, Schumer’s proposed legislation would significantly transfer power from directors to shareholders.  The simple, but flawed, rationale is that, since shareholders own the company, they should have more power to manage it.

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