Improvising Business

Improvising Busines by Stevie Ray

February 13, 2015

Column 272

“At least it wasn’t me” Is No Excuse

A major news anchor has recently lost all credibility. A beloved comedian and actor will never be seen in the same light again. Executives, politicians, journalists, and front-line employees have all lost their jobs, reputations, and sometimes their freedom because of one reason—they lied. But I am not going to talk about the liars themselves, I will instead ask, “What about the other people who knew about the lie and didn’t say anything?” Even though there are deceptions that are small enough that they can be committed in private, the kind of lies that wreak havoc are almost certainly of a shared nature. Heck, when a news anchor on a major network makes a claim that involves dozens of other individuals, you wonder why it took the lie being exposed on national TV before someone came forward to speak.

Perhaps it is because America has, of late, started to hate the whistle-blower more than the criminal; sometimes punishing them more than the person who committed the crime. Take the case of Jesse Ventura suing Chris Kyle for making false claims in his book, American Sniper. (And no, Ventura did not sue Kyle’s widow. Ventura began the lawsuit before Mr. Kyle died. Ms. Kyle was the executor of the $6 million that Kyle’s book earned.) Ventura exposed a lie that Kyle told in the book and in TV interviews and Ventura asked for a retraction. It was only after Kyle refused to recant that Ventura went to court. Testimony from several sources proved Ventura’s claim and he received roughly 30% of the book’s revenue. Ms. Kyle retained over $4 million, the accuracy of the book is now in question, and Ventura’s reputation needs some damage control.

This is not to hold Jesse Ventura up as a model citizen, but it illustrates the point of this column. Had Kyle simply admitted the falsity outright and moved on, the matter would likely have been dropped and his reputation untarnished. More to the point, there were dozens of participants in the incident he mentioned who only contradicted his story when called to testify in court. Many said that they were reluctant to speak ill of the deceased, since Kyle had tragically died in an unrelated incident. One wonders that, if the people involved in the incident had come forward sooner, perhaps this small lie would have stayed small and the reputations of all concerned wouldn’t be subject to such controversy today.

Covering up a lie almost always starts small, and almost always leads to disaster. Aaron Beam, former CFO of HealthSouth and author of HealthSouth: The Wagon to Disaster, discusses how one small lie started him down the path to allowing CEO Richard Scrushy to commit one of the biggest cases of fraud in American history. To paraphrase, before Scrushy was CEO he had to gain approval from his boss before conducting any big deals. On the day that he was to discuss hiring Beam as CFO, Scrushy asked him to come along on a meeting with the boss to discuss a new deal. At the meeting, Scrushy claimed that he and Beam had been working for days on the numbers and thought it was a good deal to sign. Not only had Beam no idea about the deal Scrushy was pushing, he hadn’t even been hired yet. But he kept his mouth shut because he didn’t want to ruin the chances for the deal happening. It could have been a lousy deal, but he still didn’t want to upset the liar.

Later, when Scrushy was CEO, he and Beam met with a potential investor who suggested, with a wink, that they could capitalize a particular start-up cost instead of expense it. According to Beam’s account, not only did Scrushy admonish him for not thinking of the accounting trick first, he said, “I am not going to let the accounting tail wag the company dog.” These seemingly harmless lies started the ball rolling. Soon, every quarter became a game of finessing the numbers so Wall Street would keep HealthSouth on the pedestal it had built. When the crash finally came, Beam admitted that, even though he blamed his behavior on the fact that Scrushy was so charismatic, the real reason was his own weakness prevented him from speaking up.

Before I stand on my mighty throne and pass judgment on Kyle, Ventura, or Beam, let’s be fair in including all of us in this type of behavior to some degree. There is an odd quirk about the human brain; researchers have discovered that we are wired with an in for a penny, in for a pound mentality. Once we start a certain behavior, especially if we have an end result in mind, it is extremely difficult for us to change course. Even quirkier, once we achieve the first goal, we continue the behavior to an even greater extent. This is why people who lose fifty dollars at black jack will continue to bet more money in order to win back their original loss. The rationale of losing just fifty dollars and calling it quits is replaced by losing hundreds of dollars to try to win back fifty. And typically, if they do win back the fifty, they continue to gamble until that is gone.

A lie is a lie; there are no gradients. Whether it is fudging quarterly income statements, skipping out of work, or taking company office supplies home, it is a lie. And whatever the reason for remaining a bystander to a lie—not wanting to interfere with someone’s big plans, the fear of reprisal, or “it’s none of my business”—being aware of a lie makes you an accomplice. And there is no such thing as an innocent bystander.

Stevie Ray is a nationally recognized corporate speaker and trainer, helping companies improve communication skills, customer service, leadership, and team management. He can be reached at www.stevierays.org or stevie@stevierays.org.