'Tis the season for confessions. First comes denial -- every mortal's classic response in a crisis. But in times like these, any leader worth his or her lofty position and pay recognizes mistakes soon enough. True confession is the mark of a confident leader. So, what's your biggest mistake?
In the past week alone, we've noticed a positive trend: leaders fessing up. "GM has made mistakes in the past," General Motors (GM) CEO Rick Wagoner told Congress on his revisit to Washington last week. Duh, you say? Well, for the boss from the capital of denial, Detroit, this was a serious gear-shift. The front page of Saturday's New York Times detailed the errors of Wagoner's ways, as he saw them: agreeing to expensive union contracts, failing to invest enough in small cars, and failing to adapt its plants for flexible manufacturing. Wagoner's admissions should help GM secure its bailout funds, but they may be too little too late to help him keep his job.
Vikram Pandit, Citigroup's (C) CEO, suggested his own errors as well. Last Monday, TV interviewer Charlie Rose asked Pandit, "What are the lessons you have learned...and what do you regret?" When he stepped into the top job late last year, Pandit told Rose, he inherited loans and businesses that he wished Citi didn't possess. "We've moved really fast," Pandit said, adding, "I keep thinking about it. Is there something I could have done sooner?"
What that might that be, the Citi chief didn't say. But Pandit's obvious self-doubt that he moved quickly enough to fix Citi seems healthier than the obfuscation of another Citi exec, Bob Rubin.
The onetime U.S. Treasury Secretary, who went on to be chairman of Citi's executive committee and is now a senior counselor and board member, responded this way to the Wall Street Journal's query about regrets: "I guess that I don't think of it quite that way."
Asked if Citi's board bears some responsibility for the company's near-fatal financial problems, Rubin said, "Maybe there are things, in the context of the facts we knew then, we should have done differently." Given his evasiveness here and elsewhere (including in a prescient year-ago interview by Fortune's Carol Loomis), the critics are piling on Rubin. In his Sunday New York Times op-ed, The Brighest Are Not Always the Best, Frank Rich wrote that Rubin has sounded "as self-deluded as [former Defense Secretary Robert] McNamara in retirement."
Sure, it's easy to criticize these days. And what a boom time for critics and cynics it is! In movie theaters now, Frost/Nixon, about a TV interviewer poking Richard Nixon to admit to crimes in Viet Nam and Watergate, is a relevant and suspenseful tour de force.
Meanwhile, last week, we saw on real-live news President Bush telling ABC's Charlie Gibson what the rest of the world has known for a while: Saddam Hussein didn't possess WMDs when the U.S. declared war on Iraq: "The biggest regret of all the Presidency has to have been the intelligence failure in Iraq," Bush admitted to Gibson. "I wish the intelligence had been different, I guess." If he had known then that Saddam's WMD's didn't exist, would there have been a war? "That is a do-over I can't do," the President replied. "It's hard for me to speculate."
So we see in our multiple global crises: Confession is one necessary step toward recovery. But it's not sufficient. Management guru Jim Collins noted this last week in a terrific talk at the Fortune 500 Forum in Washington, D.C. Outlining five stages of decline, Collins said that "denial of risk and peril" is one stage, but leaders can recover if they confront "brutal facts" -- i.e. the mistakes that took them downhill in the first place.
In the end, however, even a true confession isn't good enough. Consider some evidence. An amusing Web site called perfectapology.com cites as "the perfect business apology" JetBlue (JBLU) founder David Neeleman's pride-swallowing PR effort after the February 2007 ice storm that left planes stranded on New York runways and the airline's reputation in tatters.
The fact is, though, that Neeleman's apology, coupled with JetBlue's clever Customer Bill of Rights, did loads of good, but it wasn't enough to keep him in the CEO job, as he told me last spring in "Lessons of the Fall." The board decided that Neeleman, though contrite, lacked what it takes to carry JetBlue back to greatness. So they fired him.
Note to Wagoner and Pandit and all those other CEOs under the gun: Admit your mistakes, but then, you'd better deliver.
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