Several years ago the Economist published an interesting series of articles about crisis management. More recently the magazine suggested that it was important for any business in a crisis “to act fast, tell the whole truth and look as if you have nothing to hide” (see Bad for you). So it’s been interesting to watch the self-imposed crisis at the Franklin Mint that has been brewing since last November and developed rapidly during the last 72 hours.

The Franklin Mint, which sells “collectibles” including several Princess Diana dolls, is suing the Diana, Princess of Wales Memorial Fund for “malicious prosecution”, accusing the charity of having “acted in bad faith” when it initially sued the Franklin Mint for the rights to Princess Diana’s image in the late 1990s. The charity lost that case and was required to pay all the legal fees. The Franklin Mint subsequently decided it wanted revenge, and filed suit last November. This week the charity froze all grants to its beneficiaries citing the Franklin Mint’s lawsuit as the reason.

The initial reaction in the press was that the Princess of Wales Memorial Fund is in crisis, but in fact I think the Franklin Mint has more to lose from this unnecessary and wasteful dispute. The charity and its beneficiaries may suffer in the short-term, particularly if the Franklin Mint wins its case, but it’s unlikely that they will be affected permanently. The social problems that they address combined with the public’s collective memory of Princess Diana, will ensure that her favourite causes continue to receive help.

The Franklin Mint on the other hand is playing with fire. The media have cast them as the aggressor in this story, with Princess Diana’s favourite causes as the victims. Can you imagine the dilemma some of the Franklin Mint’s customers now face? Do they boycott Diana dolls in order to support her memorial fund, or do they continue to feed their collecting habit but possibly harm her charitable legacy in the process? That’s a tough call; either way the doll collectors can’t help but feel unhappy, and they may well hold the Franklin Mint responsible.

What was the Franklin Mint’s management thinking by taking on the ghost of a martyred royal celebrity? How could they possibly hope to win?

For more on this story see:

• the Evening Standard for the gossipy background from last November in The ‘vultures’ threatening the Diana fund;
• The New York Times attempts to explain the legal history in Diana Charity Halts Grants, Citing Lawsuit;
• the Philadelphia Daily News provides the local angle in Franklin Mint’s Diana flap.

The irony is that the Franklin Mint is suing for “malicious prosecution”, but what other kind is there? Can you sue someone out of “good faith”?

Yet another scandal hits the unregulated art & antiques industry: Sotheby’s faces probe on sales of temple loot. How long does it take for a company to reform its values?

This morning I realised that “management” is in danger of becoming a dirty word in the UK.

Estelle Morris, Minister for the Arts, was interviewed on the Today programme, because she has just been chosen as “Minister of the Year”. This award from her peers made the headlines because Morris was not a Minister for much of the last year; in October she resigned as Secretary of State for Education after publically admitting that she wasn’t up to the job, and she was appointed Minister for the Arts only last month.

On the Today programme Morris praised the Blair government for holding itself accountable for the standard of public services, but she went on to say (RealPlayer required):

“The danger is [accountability] turns politicians into managers and I think it’s because of that, that sometimes it looks as though we want to control things at the centre…

…You know I think another thing is that politicians deliver nothing. They only deliver in conjunction with the service, with teachers and doctors and nurses. And sometimes ’cause we’re so managerial I think that we probably exclude those other people from taking credit for what is being done as well.”

Given her comments Estelle Morris must have had some experience with bad managers (haven’t we all?), but the negative connotations she associates with managment generally, indicate that she needs to read the excellent book that I’ve just finished: What Management Is by Joan Magretta and Nan Stone. The subtitle is “How it works and why it’s everyone’s business“.

Everyone includes politicians, of course; and the following excerpt seems tailor-made for Estelle Morris:

Back when labor was mostly a matter of brawn, the work itself could be managed: analyzed, organized, and specified. Workers had only to do exactly what they were told, and supervisors made sure they complied. But even as the supervisory component of management has shrunk considerably, we continue to confuse authority and control. Having the authority to reward and punish – being in charge – isn’t the same thing as being able to control an individual’s performance. When people become managers for the first time, they often experience a rude awakening. At last they take control, only to find they’ve been taken hostage instead. They realize that they are now dependent as never before, because management creates performance through others. Without the willing cooperation of others, management can accomplish very little.

Clearly Estelle Morris was talking about something else when she used the words “manager” and “managerial” this morning. I suspect she meant that holding politicians to account can turn them into tyrannical, dictatorial control freaks, and that they sometimes fail to give credit where it’s due because they’re too autocratic (and selfish?).

In the end I think her choice of words was unfortunate because they will only compound the poor opinion of management that is already palpable here in the UK (see BBC Newsnight: Economy hit by bad days at the office, FT.com: Top bosses ‘overpaid and mistrusted’ and FT.com: No confidence vote for British business), which would be a shame because Magretta and Stone are correct, management in its broadest sense is everyone’s concern:

We began the book by saying what management isn’t. It isn’t supervising other people, it isn’t applied economics, it isn’t about occupying a privileged rung in a heirarchy, and it isn’t confined to commercial enterprises.

Because we have been defining terms as we’ve gone along, we can now venture to say what management is.

Management is the discipline that makes joint performance possible.

Its mission is value creation, where value is defined from the outside in, by customers and owners in the case of a business; by society, more broadly, in the case of government agencies and nonprofits.

Despite being a politician for 24 years, Estelle Morris has yet to understand what management is: the discipline that makes joint performance possible, otherwise known as leadership.

The alumni magazine from my university arrived last week, and I was struck by the size of the “births” section that was allocated to my contemporaries.

Of course, that’s simply a function of age, but it was interesting to note that almost every alumnus’ message gives the impression that their greatest accomplishment is the birth of their latest child. All these intelligent, well educated, high-achievers, and yet not one highlights a single professional accomplishment of note. Is it significant that after 20 years of learning and another 20 of hard work, they’re most proud of simply doing what comes naturally?

Well, it seems so. A couple of weeks ago the Economist published an article on the lack of women enrolled in MBA programmes, and it elicited the following response ( see Economist – Letters – The family business):

SIR – As an MBA who left a career in economic research to care for my two young children, I can tell you why more women do not pursue the qualification (“Men’s work?“, June 14th). Business schools and the careers to which they lead mould one to be self-promoting, analytical, decisive and ambitious. Motherhood requires that one be self-deprecating, intuitive, patient and tied down.

I have had to develop hastily the skills for motherhood that I had repressed in order to succeed in the business world and now resent having spent so much time and energy developing exactly the opposite of the talents I need to do what I consider the most important job of my life. For business schools to attract women they would need to change the very nature of business itself.

Barbara Ross Epp
Port Washington, New York

That’s quite an indictment of the business world and executive education. It seems business requires cold-blooded warriors, whereas motherhood calls for, well … passionate mothers.

What seems most likely to me, however, is that people are simply listing their most rewarding accomplishments. In other words, these intelligent, well educated, high-achievers have simply found raising children to be much more fulfilling than any amount of previous job satisfaction. All of which presumably bodes well for the propagation of the human race, but what does it imply about business?