Over the past several weeks, dozens of people have asked me to comment on Lonmin -- a company my co-author Steve Zaffron and I highlighted as a positive turnaround in Three Laws of Performance, which was published in 2009. A long-running strike turned violent last month, and police opened fire on protestors, killing 34 and injuring another 78. People are asking: how could things go so badly so fast?
I was an observer to Lonmin's Markiana facility in 2006 -- the site of last month's shootings. I had high-level access to then-CEO Brad Mills, and other executives and managers. I have never done business with Lonmin, never consulted to the company and never owned their stock, nor has anyone in my family.
The purpose of this blog post is to emphasize the lessons about culture, and the effects abandoned "new futures" efforts have on individuals.
In 2006, I observed a turnaround well underway. The company had gone from an "impossible situation" in 2006 -- union-management strains, an employee population with an HIV rate of almost 30% and a common perception among the employees that the company was out seeking only its own good. Employees, managers and stakeholders of all sorts -- union leaders and elected officials among them -- came together and created a "new future" for the "Greater Lonmin Community" -- a term they coined. The energy this process unlocked was what I observed in 2006, interviewing dozens of employees, managers and stakeholders.
In 2008, with production problems at the mines and threat of a hostile takeover, CEO Brad Bills resigned and most of the senior management team turned over. While I've had no contact with the company since 2008, and none with Mills since 2009, it appears that the new management team is pursuing traditional goals of production, efficiency and return on shareholder value -- and not the new future.
The first lesson is that "new futures" change efforts inspire great hope, and that caries an ethical responsibility to see them through. As far as I know, there are no villains in the Lonmin story -- no managers who secretly plotted to remove Brad Mills. Rather, the "new future" effort was radical, and my guess is that the board may not have fully understood what was at stake. When the threat of a hostile takeover emerged, I suspect the board acted out of financial and operational interests. (That's supposition on my part.)
I slept little during that trip in 2006, waking up to the sound of my teeth grinding as I thought about the delicate balance. I'd often go running in the early mornings in nature reserves near the company facilities, before starting a day of interviews, attending meetings, or seeing parts of the mining operations. One day, after running one of my favorite trails -- with stunning views of some of the oldest mountains in the world, while listening to what is now a prehistoric iPod -- I came across the body of an animal, about the size of a large dog. It had clearly been taken down by some other creature, and mostly eaten. I told a Lonmin employee about it later that day and he laughed and said, "Oh, yes, it's a lion -- one was spotted in that area two days ago. Probably best to not go running there anymore." What a perfect metaphor for Lonmin. The beauty and potential of the situation was in almost perfect balance with the danger.
Not surprisingly, I came back to the United States with a constant stomachache that was eventually diagnosed as an ulcer. My gut was picking up what my head was having difficulty sorting out. (And I'm sure I contracted the bacteria also, which antibiotics thankfully wiped out.)
Someone who is far better at getting his head and his gut to communicate is Sidney Rittenberg, who spent 16 years in a Chinese prison, to emerge as a successful businessperson and author. He read an early draft of Three Laws of Performance and told Steve and me:
If you really want to create your own future, the numerous real-life examples they give and the crystal-clear explanations they use to make their experience available to us are essential. How would I know? Well, I guess it's because I was able to survive 16 years in wrongful solitary confinement in Chinese prisons and emerge to enjoy a Hollywood happy ending, primarily because I followed the basic laws that this book illuminates to dissolve my 'default future' and create a new future for myself. It's what works -- really!
(His comments appear as an official endorsement in the book.) Rittenberg's life is especially telling, because he was released from prison only to be re-arrested and thrown back into captivity. He described his return to prison as far worse than his original stay, because he'd been given hope. Hope crushed is worse than never having experienced hope at all. It appears Lonmin was released from the "prison" of a bleak future, given the hope of a new future, only to see it ignored by those who took over after 2008. Again, this is supposition on my part, as I've had no contact, formal or otherwise, with anyone at the company since 2009.
I've seen situations where people's hopes were raised, only to be dashed when the effort was suspended. A new future can't be suspended -- it's either being revitalized, or it's being replaced by the past. There is no dimmer switch on the new future.
The second lesson is to know how bad it can get. Consider Lonmin from the perspective of Tribal Leadership. (John King, Halee Fischer-Wright and I refer to tribes as the natural building block of human efforts -- groups of between 20 and 150 -- not having anything to do with tribes as they exist in Africa.) Lonmin achieved a "Stage Five" ("life is great") culture across many of its tribes, which I witnessed and documented in 2006. Tribal cultures can (and often do) erode, one stage at a time. If this happened at Lonmin, cultures would first regress to Stage Four ("we're great"), meaning groups that had worked together would start to compete. Stage Three ("I'm great") would come next, with the focus shifting to individuals in a power struggle for control and dominance. Stage Two ("my life sucks") would come next, in which people would act as though nothing they did would make any difference. Eventually, some tribes would fall to Stage One ("life sucks"). Stage One acts out of "despairing hostility," and is marked by violence, theft, and other destructive behavior. While I don't know for sure, this pattern of cultural erosion explains the news about Lonmin -- including the violence.
If anyone ever thinks that cultures can be "built to last," please bookmark this blog post and read it on a regular basis. Stages Four and Five are powerful but also fragile. Ignore them and they decay into Stage Three and keep falling.
The third lesson is focus on the learning that this situation makes available. I would encourage anyone reading this blog post from Lonmin, or anyone affected by the tragedies, to read, in its entirety, the wisest essay on how leadership can emerge from setbacks: Warren Bennis' "The Crucibles of Authentic Leadership," from The Essential Bennis. There is good that can come from the tragedies of the last several weeks, in the form of new leadership, and a resurrection of a new future.