‘The fish rots from the head’ is a Chinese proverb commonly evoked to assign blame and responsibility of organisational failures to leadership, namely the board of directors or CEO. Leadership certainly does set the tone for the behaviour in organisations. It is important that positional leaders lead by example and model the values that enhance the organisation’s reputation and those which employees can emulate.
Not only did the captain, Francesco Schettino not rise to the challenge at the moment of crisis, but there seemed to have been no safeguards throughout the entire crew. How else does the cruise ship make an unapproved and unauthorised deviation in course without anyone communicating the change of direction, as a basic procedure?
The main learning points I have observed are:
- Making the appropriate choices is a critical aspect of leadership. In a crisis, the trickiest part of decision making is knowing, not just what to do, but when. Therefore it is important that values of the company are continually instilled because by the time a crisis strikes, people adopt the business practices and revert to their core principles. Principles are like a compass. They always point the way.
- Cultivate an environment of taking calculated risks. The captain has allegedly explained the deviation by saying that he was going to salute a fellow captain on the nearby island of Giglio. Whatever the motivation of his creative brainwave, it should be rooted in informed decisions and understanding the context and its characteristic challenges (such as the possibility of submerged rocks) and, not just from ego and recklessness.
- It is crucial that organisations appreciate that leadership is not isolated to the helm, but to encourage an environment where employees at all levels can have the courage to do what needs to be done, especially when it is the right thing to do under the circumstances without the threat of negative repercussions in ‘undermining’ the positional leader.
- Processes and procedures are to be lived and not for files! They can always be improved upon and should not be carved in stone. With human frailty comes blind-spots and gaps influenced by our intuitiveness, skill, knowledge and openness. The quality of our thinking impacts the quality of our decision-making. It was evident from the stories emanating about how the captain and the crew behaved on the Costa Concordia that any organisation is as strong as its weakest link. Any one person, at any level, can destroy a business and its reputation. Governance is not about compliance. The processes and procedures did exist, check. What value are they when they do not manifest in the employees’ behaviours!
I always assert that governance is more about human behaviour than about structures, regulations and rules. It is essentially about responsible leadership. Issues of bias in human cognition and perception, decision making under uncertainty, risk assessment, and the impact of emotion and affect on behaviour, receives less attention in governance. Until the Costa Concordia!