“Crap Happens”

“Crap Happens”
April 5, 2023 Rob Artigo
In Podcasts

“The Failure of Silicon Valley Bank (SVB) was a prime example of people and organizations who seek to place blame instead of learning from the experience.” In this Tough Things First podcast, Ray Zinn discusses how the successful business leader profits from knowing what to do when “crap happens.”

Rob Artigo: I’m Rob Artigo, your guest host for this edition of the Tough Things First podcast. I’m a writer and investigator in California. Here with me is Ray Zinn, the longest serving CEO in Silicon Valley history. Hello again, Ray.

Ray Zinn: Hi there, Rob. So good to be with you today.

Rob Artigo: I thought it might be a good idea to talk a little bit more about Silicon Valley Bank. Only in that you wrote, “The failure of Silicon Valley Bank was a prime example of people and organizations who seek to place blame instead of learning from the experience.” I thought, you know what? We talked about Silicon Valley Bank, but this is a great aspect of this because it’s not the issue about the failed banks, which includes Silicon Valley Bank and others. Credit Suisse comes to mind, but going forward, we’re going to learn more about what happened and we don’t really know much.

But tell me a little bit about what you mean about an organization where the culture basically is to place blame instead of learning from the experience. Let’s talk a little bit about that.

Ray Zinn: Well, that’s an interesting one. As I’ve mentioned in that musing, I said, “Crap happens”. The word that term crap comes from is John Crapper invented the toilet, and so it’s a play on his name as you would. It’s what we mean when we say crap happens.

Things happen whether you get rear-ended in an automobile accident, or whether you slip and fall on ice, or whether you bump your head on the cupboard door, or whatever. Stuff happens. If you bumped your head on the cupboard door, did you say that dang cupboard door? Or do you say, gee, that was pretty stupid of me to leave that door open.

It’s interesting how we as humans want to place blame rather than take on the responsibility ourselves for the outcome of what happened. It’s a typical human nature, I guess, is to say somebody else is at fault, not me, because I feel better if I can say, as they say, the devil made me do it. Let’s say you did something wrong that you regret and you just said, well, the devil made me do it. So we had to place the blame on the devil. Darn that devil and darn that cupboard door or that person who rear-ended me, that I wish that person would’ve kept their eye on the road or whatever. We always find somebody to blame rather than take on that responsibility ourselves.

There’s a term we use called accepting responsibility, and so accepting responsibility doesn’t mean to say I’m sorry. Well, it does, it includes that, but it’s not just, I’m sorry, I wished I hadn’t done that. Please accept my apology. Accepting responsibility means number one, you acknowledge that you made a mistake. I bumped my head on the door, and so you acknowledge it. So you say, I did it. I’m the one that bumped my head. The cupboard didn’t bump my head, I bumped my head. Then you confess it. You just say, hey, that was a stupid thing for me to do. I’m sorry, I wish I hadn’t have done that.

Then we have to make amends, so in other words, we got to correct the mistake, like close the door or when you get through taking whatever we want out the cupboard, we’ve got to close the door rather than leave it open. Fix the problem.

Accepting responsibility, the biggest challenge is fixing it. In fact, that’s why most people don’t accept responsibility is because they don’t have to fix it and fixing it does become an issue. That’s the challenge. I used to tell my designers at Micrel, if you make a mistake in a design and we all make mistakes, you got to correct it so it doesn’t hurt the company. Well, it’s hard to get them to do that because they want to charge me for the extra time they got to put in to fix the design issue. Whereas they ought to come in on the weekends, they ought to come in and stay longer at night or whatever, so that there’s no harm to the company.

In other words, if you accept responsibility, you accept the harm, not put the harm on someone else. That’s the challenge we have is fixing the problem without causing harm to someone else. We need to accept the harm as you would.

Then, of course the last part is don’t do it again. Don’t repeat that mistake because if you repeat it, it’s going to happen again. Learn from your mistakes. The bottom line, accepting responsibility means acknowledging you made a mistake and then fix it on your own. In other words, you take the harm, you take the responsibility for fixing it.

I betcha nine times out of 10, most people don’t take on the harm themselves to fix the problem. They want somebody else to come in like the FDIC, in the case of the Silicon Valley Bank, to pay off depositors for the money they would’ve lost if the FDIC had stuck to the $250,000 limit.

But we can’t always have somebody else bailing us out. We got to bail ourselves out, and that’s what’s called accepting responsibility. We have to learn what it means to accept responsibility. It’s not just saying, I’m sorry or I apologize. I wished I hadn’t done this or that or whatever. Saying you’re sorry is just words. Fixing the problem without harming someone else is the challenge, and for whatever it takes to fix the problem. It’s painful sometimes, it’s painful to accept responsibility.

Rob Artigo: As a business leader and you had decades at the helm of Micrel, I think what I’m hearing from you is the difference between leadership and bold leadership is if you’re a leader and you can hold people to the standard that you want to, you’re talking about the difference between the success of the company or the failure of the company, the profits of the company versus the losses.

If you are able to hold people to account and say, look, that it benefits us if you’re open and honest about this. When stuff goes sideways and crap happens, you got to deal with it and you got to come forward and state that here’s the issue and this is what happened, and then take responsibility for it.

Ray Zinn: That’s the key. The key is that rather than cause somebody else harm from your mistake, you accept the harm and do whatever it takes no excuses to pull yourself out of the dilemma that you brought upon yourself and others.

One of the cultures at Micrel was doing whatever it takes, no excuses. That means you’ll do whatever you have to do. No excusing, no blame. Don’t say, well the dang software did this or the power went out or blame…

Rob Artigo: There’s no internet.

Ray Zinn: Right, no interest. Exactly. Boy, I heard that one before. No internet or somebody screwed up the email, or I don’t know what happened. We don’t seem to want to fix the problem. We want to blame somebody else for the mistake. See then if you can find somebody else to blame, then of course you don’t have to fix it or you don’t have to fix it at your expense. That’s the key, and so the real accepting of responsibility is you take on yourself the damage. You fix the damage, whatever it takes, you fix the damage and that’s accepting responsibility.

Sometimes the Japanese, they had a thing called hara-kiri, which means they would commit suicide if they failed. A failure in Japan means you didn’t fix that problem, you just killed yourself. Of course that doesn’t fix the problem. It may fix your problem, it doesn’t fix the problem.

Rob Artigo: It creates a problem. I mean for example, if you were to say, hey, look, well I’m leaving. In the modern business world, the equivalent of that would be quitting and leaving and going someplace else because you can’t handle the fact that you made the big mess-up, but there’s a hole in the staff and your value is, you may still have value at the company. Don’t throw everything away. Just accept responsibility and move forward.

Ray Zinn: Well, in the case of the people at Silicon Valley Bank, they were terminated. They didn’t quit. If when this problem occurred when they didn’t have the proper hedging, the person responsible for that should have resigned or done something to fix it, that went out of their way to deal with it. But they didn’t. Everybody still had their job and they got their pay, maybe even got a severance pay, I don’t know. But I don’t think they paid much of a penalty other than that they had to go find another job.

Rob Artigo: Yeah, no consequences for their actions doesn’t spell good things or doesn’t mean necessarily good things for the future.

Ray Zinn: Right.

Rob Artigo: All right, well thanks again, Ray. I mean, there are probably a lot of different topics we’ll come up with that are related to the failure of banks in the country because it’s an ongoing topic, but a lot of lessons to be learned just about being an astute investor, being responsible about where you leave your money, that kind of thing.

But anyway, so you can join the conversation at toughthingsfirst.com. Your questions and comments are always welcome. Follow Ray Zinn on Twitter, Facebook, and LinkedIn, and you can find those links at toughthingsfirst.com.

Pick up Ray’s books as well, “Tough Things First” is the essential book that you need to get your hands on, and also the “Zen of Zinn.” There are three of those books and they’re all of value to help guide you through the day, get your mind set on the right things throughout the course of the day. That’s doing the tough things first. “Eating the Ugly Frog,” all the things that Ray likes to point out. You won’t regret it. Thanks again, Ray.

Ray Zinn: You’re welcome. Thank you, Rob.

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