Into the Fishbowl

Forget about business-leading in the public eye brings a whole new set of hurdles and measures.

Business and government leadership are alike only in their least important aspects, Roy Ash, former head of Litton Industries and one-time director of the Office of Management and Budget, once said. Going from business to government, according to Ash, is like going from the minors to the major leagues.

Much of what makes the public sector different involves the very nature of democratic government, whose components often are designed to promote stability rather than change. Because of this, government leaders face distinct challenges. Missions and metrics often are dictated by statutes or regulations beyond their control. Performance is subject to transparency and public scrutiny. Stakeholders are more numerous, more diverse and more competitive. And bureaucracy can impede access to resources.

For those new to government, transitions can be daunting and replete with traps that threaten credibility and momentum. And, in contrast to business, performance failures can have consequences measured not only by financial standards but by embarrassment, political defeats and, in some cases, even life and death.

These common missteps often snare unwary business leaders moving to government:

Failing to understand government's fishbowl nature. Many new arrivals suddenly find themselves very much in the public eye. Heads of major businesses often are shielded from the sort of public, media and political scrutiny and second-guessing that accompanies high-profile government appointments. The admonition that new arrivals hear-"Imagine how this will seem on the front page of tomorrow's newspaper"-is not in jest.

Thinking too narrowly about stakeholders. Satisfying everyone is impossible, so creating coalitions is essential. In business, there are shareholders, Wall Street analysts, customers, regulators, partners and employees. In federal government, there are almost 300 million citizens, 535 elected representatives, 3,000 or so members of an elected administration, thousands of special-interest constituencies and lobbyists, unions, regulatory bodies and many others.

Not grasping how performance is measured. In government, finance is but one measurement to devising a strategy. The bottom line, if one even exists in government, is always trumped by political crises, public policy or constituent pressure. Success often entails tolerating financial conditions that would never be entertained in business.

Underestimating the constraints. Government executives do not have the option of selling off an agency that performs poorly. They must change and improve it. Private companies are constructed with change in mind, while government is designed for just the opposite-to remain stable. Agencies are governed by complicated regulations, staffed by people doing narrowly defined tasks and overseen by managers whose responsibility often is to assure that rules are followed.

Overlooking nonmonetary incentives. The currency of business is currency, but the currency of government is power. One of the starkest contrasts between the two is their incentives for motivating workers. In business, this means using "push tools," or sharing in the financial benefits of a successful business plan. In government, financial incentives can conflict with the concept of professionals who carry out policies to best serve the public, not for personal gain. Leaders, therefore, must rely on "pull tools"-a compelling vision, a culture that values and recognizes success, the potential for development and advancement, and the reward of engaged teamwork-which are more difficult to design.

Overestimating control over critical resources. Acquiring resources in government is heavily regulated by Cabinet agencies and Congress, creating a competitive environment where agencies not only vie against each other but must engage the political process and gain the support of allies. Even when support is strong, acquiring quick infusions of people, facilities or technology is unlikely, given complex personnel and procurement rules. Most new government leaders must start off largely with the resources they inherited.

Expecting government to move as fast as business. Government's rhythms are different from the quarterly and annual reporting deadlines of business. So for new leaders, getting up to speed could take longer than six months, which is typical in business. Still, they are not insulated from the impatience of stakeholders and are likely to face pressures for early wins. Targets for such wins should be selected wisely, despite insistence from some quarters for rapid action, because when they are met, they increase credibility and build momentum for success with longer-term changes.

Smooth transitions to government depend on the understanding that success is measured differently than in the private sector. In business, it is assessed financially, operationally and in terms of public confidence. In government, it is assessed in the broader context of national security, economic security, the public good as well as public confidence. In fact, public confidence is just about the only factor shared by business and government. And when that's lost, it's nearly impossible to reclaim.

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