We dress like students, we dress like housewives
or in a suit and a tie
I changed my hairstyle so many times now
don’t know what I look like!

Life during Wartime, Talking Heads

Mr C. is the new C.E.O. of your firm, Firm C.  He was head of operations at one of your competitors Firm A.  He was passed over for promotion there and had to exit to get to the C Suite.  You wonder about the wisdom of your Board: Why would they choose someone who rejected for the top job by their own company?  You subscribe the “Better the Devil you know, than the Devil you don’t” principle.  If your firm appoints an internal person to the top job, at least you know their flaws and can adapt to them.  This principle also applies at Firm A.  So, if they rejected the Devil they know, he must be a really terrible Devil or, to put it in tamer economic terms, a “lemon.”

But you are also aware of the counter argument: Real change can only be achieved by an outsider.  Mr C said some smart things in the interview process and so you are happy to give him the benefit of the doubt.  You are expecting Mr C.  to define a mission for Firm C, a mission that everyone can sign on to.  Of course, to persuade everyone to work hard on the vision it has to be a “common value” – something everyone agrees is good – not a “private value” – something only a subgroup agrees is good.  In this regard, Mr. C surprises you – he makes a big play that Operations are the most important thing in a successful firm.  “Look at H.P. and Amazon,” he says.  “They don’t actually make anything, just move stuff around efficiently and/or put in together from parts they buy from other firms.  We need innovation in Operations not fundamental innovation in our product line.”

You are shocked.  Your firm has R and D Department that has produced amazing, fundamental innovations.  Innovative ability is sprinkled liberally throughout your firm in – it is famous for it.  It is a core strength of Firm C.  Why would anyone want to destroy that and focus on Operations?  What should do you do?  In times of trouble, you have a bible you turn to  – Exit, Voice and Loyalty by Albert Hirshman

Should you give voice to your concerns?  The last CEO ignored you and the new CEO might give you more attention so you had thought that you might talk to him.  But your first impressions are bad and something you might say might be misinterpreted and lead to the opposite conclusion in the mind of the new CEO.  Talking is dangerous anyway.  You might be identified as a troublemaker and given lots of terrible work to do.  Better to keep quiet and blend in with the crowd.

Is loyalty enough to keep you working hard anyway?  Your firm is not a non-profit and, given the CEO plans to quash innovation, it is basically going to produce junk.  Why should anyone be loyal to that?

You are drawn inexorably to Hirshman’s last piece of advice: exit.  This is hard during the Great Recession – there are few jobs going around.  You will be joined by all those who can exit from your sinking ship C so you have to move fast….