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TALENT MANAGEMENT MAGAZINE

The Danger of Denial

by Marshall Goldsmith

We all have an incredible ability to deny what we don't want to

see coming - even though it may be obvious to everyone around
us.

In the 1980s, I appeared on a videotape that was widely

distributed as part of a leadership development course for IBM
managers. On the tape, I suggested that small computers - more
powerful than existing mainframes - would soon be on desktops
everywhere and that they would cost less than $5,000. Anyone
could have figured this out. All I had to do was look at the path of
technological innovation and make a reasonable guess. Many
people in IBM knew what was coming - they were just in denial
about how fast it would happen. After losing billions of dollars, the
IBM board woke up and decided to get new leadership. They
changed the company, and IBM made a remarkable comeback.

After making my first free VoIP phone call to a friend in Asia, I

suggested to a group of AT&T leaders that they were facing an
incredible competitive threat. It seemed certain that AT&T's profit
margins on long-distance calls were going to start disappearing
and that their historic profit machine was going to go away. I
don't know much about telecommunications - it just seemed
obvious. Several executives laughed at my comments, and said
that the "quality of competing technologies was no good" and that
their long-successful business would continue to generate huge
piles of cash for years to come. They were in massive denial. After
watching billions of dollars of profit disappear, the AT&T board
finally woke up and decided to get new leadership. In their case,
it didn't work.

I just returned from a trip around the world. As an American,

what I observed was sobering. Within the next 20 years there will
be millions of brilliant, highly educated knowledge workers
flooding the global job market. They will speak fluent English.
They will be incredibly motivated to improve the quality of life for

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themselves and their families. They will have deep expertise in

many fields. They will be willing to work for less than supermarket
checkout clerks in the United States.

I had the chance to meet many of these young men and women.
They appreciate and value learning. They are grateful for the
chance to grow and to develop their skills. They are willing to
invest in their futures.

Many Americans don't have a clue what is coming. Our political

leaders are in denial. Both political parties imply that, given a
level playing field, the American worker will win. This is easy for
them to say - it's what voters like to hear. Unfortunately, it is far
from reality.

Can you imagine most Americans' reaction if the German, French

or Japanese people even implied, "Given a level playing field, we
will always win." Americans would consider this arrogant and
would be appalled at this incredibly offensive comment. How do
you think the rest of the world feels when it hears our leaders talk
this way?

I haven't met too many American workers who have IQs of 160,
outstanding educations and the willingness to work 80 hours a
week making less than $20,000 a year. I have met many workers
who would, and they are from Eastern Europe, India and China.
Given a level playing field, we won't always win!

Former Intel Chairman Craig Barrett recently said that he feels

positively about Intel's future, but is concerned about his
grandchildren's future. He is apprehensive that as Americans, "We
somehow think that we have a God-given right to be the world's
number-one economy." Barrett believes that if Americans don't
increase our efforts in research and development, and
dramatically improve our education system, we may lose our
leadership. He's right. Barrett has the courage to tell the hard
truth, and we should all be listening.

I'm not suggesting that America cannot meet this new challenge.
The United States has a history of continued innovation and
flexibility that few countries can match. I'm just suggesting that it
won't be easy. The rest of the world is catching up faster than we
want to admit.

Like IBM and AT&T, Americans are going to have to face the
competitive reality that exists, and make the necessary changes

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or suffer the consequences. Unlike a company, a country doesn't

have a board of directors. We, the citizens, are the board. We
need a new kind of leadership. We need leaders who tell us the
hard truth and challenge us to face the competitive reality that
exists. As Barrett suggested, we have to make continuing
education a top priority. We have to invest in our people and our
future. We have to let go of the arrogance that says, "We will
always win." We will only continue to win if we deserve to win.

We have to recognize the danger of denial - the sooner the better.

Dr. Marshall Goldsmith's 24 books include "What Got You

Here Won't Get You There" - a New York Times best-seller,
Wall Street Journal #1 business book and Harold Longman
Award winner for Business Book of the Year. His latest
book "Succession: Are You Ready?" - is the newest edition
to the Harvard Business 'Memo to the CEO' series. His
personal website,
http://www.marshallgoldsmithlibrary.com/, contains
hundreds of his articles and videos.

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