Proven track records can usually be found in business and the military. Government then appoints people from these groups, and maybe also from academe and advocacy groups (who are used to patriotic salaries). The pool expanded lately to the digital field of bloggers known for their bashing skills so useful in public communications.
In terms of management skills, business people seem to be ideal recruits for public service. But do they transition well from corporate to government?
“Technocrat” is a dated term associated with the ’60s, and not at all related to technology. It referred to recognized business leaders (seldom entrepreneurs), recruited to join the cabinet. The sourcing of political talent from business rather than political parties was an innovation in the ’60s, and unfortunately associated with those times.
Technocrat was a term of respect, hinting of sacrifices in corporate perks, large compensations and bonuses, all for “giving back” to the country by serving in government. It also implied the ability to employ business skills in managing public resources and not succumbing to lobbying, corruption, and ulterior motives. Anyway, the presumption that the private sector is transparent and clean is not always a safe premise.
Management principles of objective-setting, timelines, and quantifiable metrics may still succeed with quasi-corporate organizations like GOCCs. These publicly owned enterprises deal with corporate performance goals, including profitability and efficiency. They are however not immune from pressures of behest loans and “highly” recommended executive hires.
Many factors undermine the simplistic assumption that what works in business can be applied as well to government. The differences become more pronounced as the political factors rise, as in running more traditional organizations like social welfare or local governments.
Here are some challenges a business leader does not even deal with in his corporate job.
Media scrutiny goes beyond investor relations where the topics are limited to business issues, like debt and expansion plans. No financial reporter will ask about relatives involved in maintenance contracts or whether athletes are qualified to be inspectors. The political media (or circus) can ascribe the basest motives to government decisions, depending on who made them. Media are routinely used as demolition agents for interests that have been crossed. And many sources for the vilest stories are anonymous.
A corporate CEO is basically an autocrat, even when espousing consensus building (my door is always open, but not my mind). In contrast, a political leader needs many sign-offs and approvals of political blocks to pursue a policy, say the modernization of the metro transport system. CEOs trained in giving monetary incentives to trusted lieutenants who perform well cannot bestow such generous rewards without running afoul of the audit commission.
The metrics of success are vague in politics. There may be the statistical litany of schoolhouses built and kilometers of road constructed. But there are always unbuilt roads and unconstructed shelters after disasters that have their critics. Every anniversary of a typhoon is an opportunity for declaring failures. Corporations just take care of a few numbers like the bottom line, stock price, and dividend payout.
Political power cannot be delegated. Companies have executives with their own self-activating tasks and a fixed set of objectives. So, even in a crisis, the CEO need not be carrying a hose to put out fires. He has people to do that. In politics, an unavailable chief is considered suspect — where is he? The query on his absence is couched in terms of dereliction of duty.
It is clear that business and politics need work together to bring up the GDP. A politician would make a bad CEO, trying to balance interests and making bad trade-offs to appease certain groups. On the other hand, an autocratic CEO will bulldoze his “political will” towards a certain direction to achieve a goal on time and on budget, never mind the writhing bodies that get caught under the wheels. Being sincere does not preclude being pilloried as brutal and insensitive.
The temptation for successful businessmen to run a bigger organization is always present. Sometimes, the quest is limited to running a bigger company in another industry. But after all these acquisitions, the CEO’s eyes may turn to new frontiers like politics.
If one can run a large conglomerate, isn’t it relatively easy to run Philippines, Inc? Too late does the successful manager realize that politics is nothing like a day in the office, it is often a burning building. Are those rushing to the scene really firefighters… or just looters?
A. R. Samson is chair and CEO of Touch DDB.
