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Zondo reports: We have the facts – now we need action

by Jon Foster-Pedley: Dean and director of Henley Business School Africa.
The third instalment in the three-part Zondo Commission into State Capture report has been released and as we digest the findings, the biggest question in the room is stark: Will any of it change anything?

It seems a heresy to even ask it, but South Africa has a history of commissions of enquiry whose recommendations are yellowing in locked storerooms, their impact reduced to a historical footnote. It would be a terribly missed opportunity if this was to happen to the work of the Zondo Commission. If this does happen though, it won’t solely be the result of competing agendas and factions but because of the same phenomenon that sucks the energy out of potential change in the corporate world. We don’t need that classic CEO office decoration – SPOTS (Strategic Plans On The Shelf), but the corporate activists’ playbook – STRIPEs (Strategy That Results In Powerful Execution).

For change to happen, we need a framework for change. We need to think differently. We need to imagine, visualise and then expect different outcomes. The problem is that people are not taught to think systemically. If you’re a business leader trained to think in terms of profit and loss rather than value and impact, it will be very difficult to do anything else beyond that paradigm because you will always default to it, especially, of course, in times of crisis.

Managing companies and organisations is incredibly complex, there are many moving parts. The late Japanese artist Shigeo Fukada created an unforgettable illusion in 1984, called Underground Piano. There were two images, one a reflection of the other. The reflected image in the mirror is a perfect rendition of what we know and expect a grand piano to look at. The actual piano, if you can call it that, is a chaotic rendition of all its constituent parts, out of order and haphazardly assembled on top and alongside each other, that only look like a piano in the mirror when it’s photographed from one narrow perspective and position.

In strategy sessions, I name that image the ‘corporate annual report’. The magazine-like screed you hold in your hands, carefully crafted with images, graphs and calming narratives, is the piano in the mirror. The actual year that’s just gone by for the company, described by the annual report, is actually more like the chaotic mass of ebony and ivory that you improvise and sense-make around.

To change a company, it requires an activist CEO at the helm. This is a person who can think systemically, rather than fixating on lagging metrics and measurements which lock us into set ways of thinking. A great business leader doesn’t make profit the ultimate goal, but rather considers value and prosperity, because prosperity is integrative and includes profit and loss along with the consequences and the impact, good and bad, of getting to that bottom line. Systemic thinking differs from linear thinking because it involves looking at multiple causalities rather than creating linear expectations. It occurs through seeing past the stereotypes, breaking shibboleths and culling sacred cows.

The great CEOs of the world actively seek out discordant views to recalibrate their echo chambers and reveal their prejudices and taken-for-granted assumptions. It provides vital peripheral vision, when they’re getting locked into tunnel vision.

It’s an uncomfortable, often incredibly painful, process but if it is done correctly it allows the best companies to self-correct when they go off course and pre-emptively change, rather than having change forced upon them. It’s difficult because businesses are actually very conservative by definition; often obsessed by replicability and the pursuit of ever-increasing profit.

As Donald Sull described in his work The Dynamic of Failure, when companies hold fast to what once worked when everything has changed, failure is almost inevitable. The old strategic frames metamorphose into blinders, processes become routines, relationships morph into shackles and values become dogmas. No one in business is immune to that, the incredible disruption of COVID-19 put paid to that. And, as the Zondo report is showing, political parties aren’t either.

But thinking is only one leg of the trifecta that moulds the activist CEO, the second leg is illuminating – creating a language that reifies abstract theory, helping people understand the new way of thinking. The abstract must be made accessible, relevant, vivid and real. To paraphrase Yuval Noah Harari, we need to create meta-narratives that inspire us to put aside our differences and work together. The third leg, essential for all businesses and organisations, is measuring – to manage the entire process by putting in place new metrics and expectations, of carbon, or value or equity for example, so that people can be held to account across all the inter-related goals. Without all three working in tandem, change will not happen.

The Zondo Report provides the kind of systemic thinking that explains how State Capture occurred, in great detail, looking especially at the role of corporate collusion. But we need more. We need an understanding of the consequences of state capture; of lost opportunities for people desperate to break the cycle of poverty. We need a language that does more than pay lip service and platitudes to the scourge of corruption, but evangelises and animates every single one of us from citizen to civil servant; CEO to cabinet minister. And then we need to manage the process; hold people to account and, vitally, prosecute those who have been found wanting and show everyone that there are very real consequences for mismanagement of public funds, our funds.

We desperately need activist CEOs in this country. We need business leaders with a vision of how they can contribute to the prosperity of this country and a passion to make it happen. And, in the same breath, we need them dispassionate enough to be able to sit back and trust their subordinates to take the opportunity to run with their part of the project while always provoking them to higher achievement and to stay unsettled. We need business leaders who can innovate and create sustainable jobs and invest in communities. We need those leaders to help radically transform our economy, whether supply chains or staff ownership. But the most important activist CEO is the one that sits in the Union Building. Only time will tell, if the incumbent is that – and, if so, whether recommendations of the Zondo Commission will be worth the paper they are printed on. Will we take the risk of messy action and support, or stay in the arid comfort of abstract platitudes as we straddle the fence? After all, an activist is the creator of a movement, not of a report. Will we be moved?

There’s an enormous endorphin rush in identifying a problem and describing it enormously well. The problem is so many of us think that doing that is the same as actually solving the problem we’ve described. Great leaders know, and we all need to start learning this, that understanding a problem well has to come with the inescapable obligation to sort it out too. Otherwise, it’s just all just clever talk and no transforming action.

Originally published on Daily Maverick

Useful resources:
Henley Business School
At the core of Henley’s philosophy is the belief that we need to develop managers and leaders for the future. We believe the challenge facing future leaders is the need to solve dilemmas through making choices. We work with both individuals and organisations to create the appropriate learning environment to facilitate the critical thinking skills to prepare for the future.
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