Wednesday, October 1, 2008

CEO's Should Show Japanese Management Contrition

The ranking member of the Senate Finance Committee called for Wall Street CEO's to bow deeply and apologize for their mismanagement. However, to keep this from becoming a Lyndie England symbolic event, additional groups should join the big bow.

That includes Boards of Directors of those same Wall Street firms. Boards approved risky corporate strategies, structured dice rolling executive incentive compensation, and were aware keenly of off balance sheet accounting practices.

America's elected leaders need to tighten their abdominal muscles for that bow of apology to taxpayers. From deregulation to voluntary regulation to not enforcing existing rules, the federal government played a key role. Bush lauded financial innovation, which turned out to be vaporware.

The irony comes from the man who taught the Japanese management, Chuck Grassley wants expressed. Dr. W. Edwards Deming educated Japanese leaders on quality as part of their economic recovery post World War II. He evolved his teachings to a comprehensive theory of leadership, one that George W. Bush and our Congress ignore at every turn.

The heavy losses are here, and many should apologize. But new knowledge of Dr. Deming's teachings is required. Study up, Chuck!