How many times are we surprised by someone’s behavior, e.g. a boss or a colleague? How many times do we have occasion to wonder ‘why in the world is he or she acting that way?’
In business settings, it could be something as simple as a strong negative response to a suggestion by someone. ‘Let’s take everyone bowling for the offsite’ suggested by one is met with ‘That’s the stupidest *&#$@ing thing I ever heard of!’ by another.
‘Wow,’ everyone thinks. ‘What did she have for breakfast?’
No one says anything directly to her. The guy whose favorite uncle always took him bowling on special occasions clams up. The offsite happens somewhere else, and likely enough, everything goes just fine.
On the other hand, we see instances of such wonder in business every day that have more far-reaching consequences.
In one case, a CEO’s private, management-owned company was purchased by a Fortune 1000 company, and he became a division head of the much larger publicly traded enterprise. The larger platform proves beneficial, he grows revenues by 30+% year over year, and his division is one of the darlings of the company, featured prominently in public statements and analyst calls.
When the company was sold, he made out quite well in the deal, but once he becomes an employee, his salary during the financial earn-out is set 10% below of his already low pre-deal salary, and his bonus is subjective – determined by the enterprise CEO and not tied to a specific metric. When he challenges the compensation program, the CEO reminds him how well he did in the deal. Furthermore, despite his division’s extraordinary growth, his budgeted growth rate is set even higher. He is behind plan all year, and the CEO regularly tells him that he is not doing enough.
What is going on here? A company of this size with such an ill-defined executive compensation program? A head-scratcher, right?
Well, if you knew the details of the enterprise CEO’s hardscrabble background and how he fought his way to the top, you might be less surprised.Like so many similar circumstances, it’s all about context.
The same is true in politics and has never been more evident than in this year’s presidential campaign. How do you explain Donald Trump? Everyone is trying, has been trying for months.
Donald Trump is not a politician, he keeps reminding us; he’s a businessman. And he’s not just any old businessman, he’s a real estate developer. A recent Wall St. Journal article reminds us once again – it’s all about context.
“The Presidency Isn’t a Real-Estate Deal” points out Alan J. Pomerantz.http://www.wsj.com/articles/the-presidency-isnt-a-real-estate-deal-1465943560.)
The rules a developer plays by are not the same rules a President must live by, and yet, the author points out, they are the same rules Donald Trump is using to operate as a presidential candidate.
Here are the Rules Trump Plays By, with a few brief notes of explanation to whet your appetite (I encourage you to read the entire succinctly argued article):
- Businessmen can always walk away from a deal. Trump played the primaries as if he could quit whenever he wanted to. However, “the President cannot simply walk away from China if he does not like Xi Jinping.”
- Companies usually can fire at will. Trump’s reality show popularity was built on his signature phrase: ‘You’re fired!’ “A President Trump will have to work with 535 members of Congress whom he cannot fire. Many will want him to fail.”
- Executives are autocrats. “It is inconceivable that Mr. Trump’s business decisions at Trump Enterprises could be overruled. Presidents, in contrast, are tightly constrained by laws, rules and regulations.”
- In business there are rarely fact checkers. “Sellers can say close to anything they want during a real-estate negotiation …representations are eventually put into writing, and the buyer is responsible for verification [at the end of all the talk] …Does this sound like Mr. Trump’s campaign?”
- A common ploy in business is to create anxiety. “Sound familiar? Mr. Trump suggested that if he didn’t get the Republican nomination there might be riots or he might run a third-party campaign. He was presenting an outcome that party leaders wanted desperately to avoid—and he knew it.”
- A business always has bankruptcy as an option. “If a real-estate deal needs to be modified, the developer can threaten or actually file chapter 11—something Mr. Trump has done repeatedly with his casinos” and has threatened with regard to American financial obligations
When you realize Trump is playing by these rules, nothing he does is surprising. Imagine if he were elected President and continued to play the game his way. (Indeed, it is impossible to imagine he would NOT play the game his way, if elected.)
How do you explain Donald Trump? How do you explain the enterprise CEO above? How do you explain a colleague’s surprisingly obstreperous reaction to an innocuous suggestion?
The answer lies in understanding the context in which they operate. What is his history? What motivates her? How does he define success and failure? After all, what they’re doing is normal for them, within a certain context.
If you can figure what that is, you’ll be better able to both explain and predict their behavior, and avoid being fooled (again!)
Comments? I’d like to hear your thoughts. Email me at firstname.lastname@example.org