August 28, 2015
Every organization should have a few clear and unambiguous rules and principles that are followed and enforced at every level. These principles build culture and set standards that can readily and credibly spread throughout any organization. A string of executive controversies during the summer months has brought this issue into stark contrast. Two bewildering examples drawn from the headlines include recent firings: ï The University of Georgiaís athletic director following a DUI arrest (when part of his responsibilities involved encouraging fans not to drink at the collegeís sporting events). ï Hewlett-Packardís CEO for breaches of trust and conduct after pledging to ethically lead his business. In setting standards, I suggest leaders and boards figure out whatís really important. If you donít live up to these rules, youíre gone, no matter what position you hold or who you are. If you are the Georgia athletic director, you need to follow the behavioral rules that you are telling students to follow. And if you are the CEO of HP, you must provide accurate expense reports and other information. I learned my lesson about following the rules at my first real job as a part-time salesperson for Baker Shoes in September 1967. Back in those days, there was no orientation, no employee handbook and no training. Before my first day of work, my boss, Joseph Silverman, told me how much I would be paid, what I would do and what hours I would work. Finally, he said, ìBe here at 8:30 a.m. Saturday. Wear a white shirt and a dark suit.î I got up on Saturday, ready to go to work for eight hours on what was already a muggy day in East Liberty, an urban neighborhood in Pittsburgh. But there was one problem: I had only one heavy gray wool suit, which had been given to me by my friend, David Kalson, for a role in the prior yearís class play. If I wore that suit, I knew I would burn up, sweat and itch on a sweltering day in the un-air-conditioned shoe store. So I came up with a better plan: I would wear my solid lightweight dark-blue blazer with matching blue slacks. The blazer buttons were gold, but it looked just like a suit, and I would be more comfortable. I arrived at work on time, greeted by Mr. Silverman, who wore dark suit and white shirt. His first reaction before I entered the building: ìWhereís the suit?î I replied, ìBut itís hot and this is just like a suit.î Mr. Silverman said, ìI said a suit, not just like a suit. Go home and come back in a suit if you have one. Otherwise, forget it.î I went home and told my dad. Without hesitation, he ordered, ìPut on your suit and get down there now.î So I did. I sweated that first day and first month until I could save enough to buy a lighter-weight suit. Bakerís did not spend a lot to get its message out. But the companyís dress code was embedded in its culture. Mr. Silverman always wore a suit, he communicated the rule to every employee before they started, and he enforced it. It was clear and important, and he brooked no exceptions. And that was the rule in the other stores across the nation. Some organizationsí boards and leaders fall back on complex and wordy rules and codes of conduct. Itís easier than figuring out whatís really important, universal and essential to the business.† But itís a vital exercise if you want to draw clear lines that canít be crossed. You still have plenty of room for discretion to deal with ìgray-areaî exceptions. But where basic principles, values, cultural, legal and reputational risks intersect, the rules need to be as clear and unambiguous as Mr. Silvermanís ìWear a dark suit and a white shirtî was back in 1967. Stephen Paskoff is president and CEO of Atlanta-based ELI Inc., a provider of ethics and compliance learning solutions. He can be contacted at firstname.lastname@example.org.