Responsibility for work failures inspires honesty

Editor's note: A chance conversation about his Mormon faith with a friend in the publishing business led to an offer for Jeff Benedict to write about "The Mormon Way of Doing Business." For his book, Benedict interviewed eight prominent CEOs who are members of The Church of Jesus Christ of Latter-day Saints. The Deseret Morning News will share six short excerpts from the book on Sundays, concluding Dec. 31. For more information about the book, go online to www.jeffbenedict.com.

Opportunities to be dishonest in business present themselves every day, and none of these executives claim immunity from the pressures. "There is so much pressure to perform," said Dave Checketts. "Shareholders demand a certain kind of performance. You take that pressure, internalize it, and pass it down to other employees that work for you. They feel it, and their job becomes 'How do we deliver to expectations?' instead of 'How do we do what is right?' "

Checketts acknowledged that part of this is structural. "In some companies, the entire management team has compensation incentives that are based on hitting the goals and expectations and achieving budgets," he said. "Thirty to forty percent of their livelihood is based on this. You get pressure from the top down to hit the mark."

To avoid these temptations, these leaders subscribe to some simple rules. ...

Rule #3: Make no Excuses

The most important aspect of honesty in business is taking responsibility for one's own actions. In August of 2005, Dell Computers made an unusual announcement: It had fallen short of expectations and failed to meet its goals as well as the projections set by analysts during the second quarter of the year. Profits had gone up 28 percent that quarter. But overall Dell had expected revenues to rise by several hundred million dollars more.

Then Dell's CEO, Kevin Rollins , made an even more unusual announcement: He took personal responsibility for the shortfalls by blaming himself. In a conference call with reporters, Rollins said: "Frankly, we executed poorly on managing overall selling prices."

Following Rollins' announcement, the New York Times profiled his unusual management style, pointing out that "there's an established drill, or so it sometimes seems, when a publicly traded company disappoints Wall Street. The chief executive blames high oil prices. Or it's the fault of unforeseen happenings in Asia, or of a software upgrade that didn't go as planned."