Oct 02, 2015

VW’s Losing Mindset About Winning

 

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All of our actions reflect the mindset behind them. The way we think and feel, and how we see the world, drive our behavior. This axiom is inescapable.

The bad news for Volkswagen is that a limited mindset, one that’s distorted or terribly out-of-touch, can point people to do things they absolutely shouldn’t do.

The good news, for all of us, is that leaders can update their mindsets, including their understanding of “winning.” When they do that, they foster entirely different choices by the people who work for them. In turn, they create very different results.

Winning By Any Means Necessary

No matter how you slice it, the consequences for VW of its malignant behavior are disastrous: financially; legally; politically; or morally. They’re topping Enron for the worst case of corporate fraud in recent memory, in part because their strategy had so many scandalous elements.

It’s hard enough to imagine how they embraced a scheme to trick US emissions tests while pouring pollutants into the air of up to 40 times the legal limit. It strains the imagination to the breaking point that all the while, their marketing campaign promoted them as the “green” car with “Clean Diesel.”

What on earth were they thinking??

In short, they wanted to win. That’s a fairly standard goal for a business, of course. And a good one. But how you define “winning” makes all the difference in how your people work to achieve it.

In VWs case, the mindset around winning was an outdated, narrow understanding of business success. They wanted to best Toyota as the leading carmaker in the world. To do that, they needed to penetrate the American market. They did both. Indeed, last year was VWs most profitable. They made it to number one, with short-term profit maximization achieved. According to that mindset, they won.

In the end, this is a pyrrhic victory for the ages: a win inflicting so much harm on the victor that it’s actually a defeat. Lawsuits; penalties; a shattered reputation; criminal charges; a CEO resigned in shame; you name it.

And the damage is hardly reserved for them alone. By disregarding the harm their “win” could bring to others, leaders at VW wrought havoc all around them. In addition to the body blows to the company itself, the damaging ripple effects of their “winning strategy” will be measurable for years. Perhaps worst of all in the health and welfare of the air-breathing public.

The real scorecard brings us to a very different conclusion: “Winning By Any Means Necessary” is a mindset whose time has come – and gone.

Changing Behavior Requires Changing Mindsets

For many of us, it’s hard to digest the scale of this betrayal. We can’t believe VW would violate US laws in such an extreme and intentional way. We can’t stomach their knowingly pumping toxins into the atmosphere while the rest of the world organizes to tackle climate change. We can’t make sense of their seeming appreciation of customer loyalty while they were secretly violating that trust in the most egregious and nefarious way.

There is a hard truth at the root of this mystery. At the end of the day, there is no compliance rule, no regulation, and even no moral imperative, that can hold if the mindset in place is not supporting it. That explains at least part of what went so very wrong here.

This principle also tells us something about what needs to change, both in VW, and in many businesses that share their mindset about winning. It’s not accomplished by replacing the CEO. It’s not done by inflicting the pain of a slashed stock price. The change we need to prevent something like this from happening again comes from a transformation in the mindset of leaders, who then embed their new values and worldview throughout the organization.

Leading wisely and living well requires a different understanding of what it means to win. A mindset that says successful leaders tap into something bigger than themselves, and take honorable action that considers the common good. In this worldview, winning means creating results that are profitable and sustainable, attained through fair play. It means extending your circle of concern beyond yourself or just those immediately around you, to a felt sense of broad, mutual responsibility to care about each other’s safety and well-being. In this mindset, breaking laws to dump poison into the air would make no sense, because we’d understand that since we are part of nature, doing catastrophic damage to our environment would be far, far from “winning.”

VWs appalling behavior reveals a disturbing mindset underneath. Any business with a similar, outdated set of values around winning should heed their warning call. You can set your culture in the right direction by taking a hard look at the beliefs that drive your executive decisions and collective action. Then do the real work of transforming problematic mindsets and embedding new ones. This guides you toward a kind of winning that is the true measure of success.

Originally published on LinkedIn Pulse

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