The Politics of Executive Suites

It has been a while since I penned a column for this esteemed website, but that doesn't mean I haven't been reading what Bob Wilson and company have been posting and positing. Au contraire, I have taken a keen interest in many of the issues that have been highlighted during 2014. Now that we are well nigh onto the end of this year, I decided to add my opinion.

Perhaps the most inflammatory development upon which Bob Wilson has waxed often (and eloquent) during 2014 was the sudden and summary dismissal of John Plotkin from SAIF in Oregon. When situations like this surface, the “old breed” of insurance professionals collectively shakes their heads, and comment on the brutal nature of politics in the “E-suite” in this industry. However, unfortunately (as well as realistically), it is not likely to change any century soon.

The details surrounding Plotkin's dismissal at SAIF has been well chronicled on this website. There is no need to rehash that quagmire. The real issue, at least to me, is the underlying animus that propels such actions in the insurance industry and elsewhere. It seems to be a trend that has self-perpetuated since the modern insurance industry began in Edward Lloyd's coffee shop in London in 1688.

Having been both an observer as well as a subject of this type of corporate execution, I have rather definite ideas and opinions regarding Plotkin-like actions.

First, it is reprehensible that any solid citizen, be it man or woman, is cashiered from a leadership position on what amounts to groundless charges. That being said, this nonsense occurs with dizzying frequency in the insurance industry. The “game” of politics itself is as unsavory a topic that can be discussed. Unfortunately, it is the essence of corporate life. No one is immune from its tentacles. Attempting to ignore the reality of politics, or believing if you keep your head down and just do the job with ne plus ultra competence and dedication will render you protected or exempt, will be grossly insufficient.

Executive leadership is difficult enough without worrying about politics. But if the leader is not continuously mindful of the “environmental” issues, shipwreck is certain to occur. At times the fall comes about as a result of a moral imperative of refusing to do an act that the leader knows is not right. For example, being told by one's superior to terminate an employee, when the executive knows the employee is doing excellent work. Refusing to carry out this order inevitably results in the executive's execution (but at least they can still look at themselves in the mirror for refusing an immoral act).

Another pitfall is what I term the “no man's land ballet.” This is when there are two sides bent on destroying one another. The executive is on neither side, nor attempts to walk between the two warring factions and simply do the job. Unfortunately, the result is usually a “you're either with us or against us” mentality by the two sides. They then both conspire to eject the executive because he/she hasn't demonstrated solidarity with their “platform.” Again, politics rears its ugly head with sudden ferocity.

Another potential career ditch is focused around the need for change. Sometimes an executive knows that unless a sea change is affected, goals will be impossible to be met. True change is a frightening proposition to many organizations. When it begins, people become uncomfortable, complain loudly, sometimes quit, and turmoil ensues. In some instances, the Board of Directors or CEO will rethink the need for short term organizational chaos to inevitably attain enhanced operating efficiency and blame the progenitor of the change. The result; another well meaning executive cashiered for simply carrying out what he/she said they were going to do, and with initial approval from the powers that be.

Perhaps the most heinous form of dismissal is one where personal perceptions are the reason for the separation. This is best illustrated by the situation of Lee Iacocca with Ford Motor Company. Iacocca had a brilliant 32 year career at Ford after joining the organization as an engineer trainee in 1946. He worked himself up to the executive ranks, most notably being the executive in charge of the team that launched the Ford Mustang in 1964.  He eventually arose to President of the Car & Truck Division. Then one day in June of 1978, Ford Chairman Henry Ford II simply terminated Iacocca. Henry Ford II never revealed the reasons he fired Iacocca, but according to the latter, Ford told him “I just don't like you.” Fortunately for Iacocca, he became president of Chrysler five months later and ultimately transformed the foundering number 3 US auto maker into a profitable enterprise. But there is no defense that can be raised when the boss tells you something like “I just don't like you.” You are “gone baby, gone.”

In the case of John Plotkin, it seems that SAIF's Board had enough members who just didn't like him. Charges can always be manufactured out of thin air to provide a thin aegis of “legitimacy” for the dismissal, especially in a state entity such as SAIF. They will surely not hold up under scrutiny, but they serve to provide a temporary cover to the entity or person taking the action.

Unfortunately, Plotkin's termination, though regretful and apparently underserved, will be far from the last dismissal that occurs in the insurance industry, and elsewhere, because someone takes a dislike to an executive for no palpable reason. I know of one senior claims officer who was dismissed because the CEO's wife didn't take kindly to him for whatever reason. 

Be unsafe in the knowledge that these depredations will continue. Good, moral leaders have and will be sacrificed on the altar of politics and that will not change in 2015 or 2115.

So enjoy the New Year, and try to keep your head down. The career you save may be your own.                    

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About the Author:

John D'Alusio has over 30 years experience in P/C insurance with executive management positions in administration, field operations, and claim technical areas. Mr. D'Alusio has had many articles published in industry periodicals, and is also a contributing author to the LexisNexis published, “Complete Guide to Medicare Secondary Payer Compliance.”  He writes a monthly column for Risk & Insurance Magazine and is a quarterly columnist for AMComp Magazine.

His Risk & Insurance column is located at:
http://www.riskandinsurance.com/workerscomp.jsp

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