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Service above profit, outcomes above output

By Dr. Henry Wong Meng Yeong | Friday, November 30, 2012 at 3:32AM

When French rogue trader Jérôme Kerviel of Société Générale was charged for incurring a €4.9 billion trading loss, he argued that his only goal as directed was to make money for the bank. Although he never profited personally from the unauthorized trades, his gain by way of bonuses would have been dependent on his “performance.”

Organizations, be they corporations or governments, must communicate their priorities to all rank and file. But if the priority is all about making a profit or meeting a budget instead of serving people's needs, employees and civil servants will be driven to meet the fiscal targets regardless of the consequences. That has opened the door many times to fraud and corruption which has toppled corporations, governments and even empires.

A reminder from Confucius states that wealth acquired in a legitimate manner even by a lowly cart driver is honorable, and if not, he will have no part of it.

Translating an honorable culture into established organizational behaviour where ethics and integrity prevail requires committed strategic planning and consistent execution. Putting “tone at the top” into action requires more than a mission statement, paying mere lip service to ethics and integrity or even appointing exemplary leaders at the top.

Tone at the top will have to be communicated clearly and often to employees so they know what is expected of them by way of unambiguous guidelines and simple rules. Confucius states that these rules communicated from the superiors to those below are likened to the wind and the grass. The grass (employees) must bend when the wind (the rules) blows over it.

Confucius did not teach about the management of corporations but the management of government, which in China would have been the largest organization of his time. Hence the superiors and those below he talks about refers to ministers and civil servants.

But as Confucius reminds us, setting the right priorities and policies matters because the ends do not justify the means. And there is folly -- and even danger -- when performance indicators are measured by outputs instead of outcomes.