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Methodical Tyrants

Mayor Wilder fancies himself as a slash-and-burn chief executive, a breed long embraced by Wall Street. But has he gone too far?



Bill Pantele has worked for tyrants before.

The City Council president, a longtime Democrat and former corporate attorney, worked for Figgie International when the company was in its heyday in the mid-1980s, when it moved from Cleveland to Richmond for a few years.

Mayor L. Douglas Wilder has his moments, but Pantele remembers well the tirades of his former boss, one of the most successful slash-and-burn CEOs ever to call Richmond home, Harry Figgie.

It's a name that cuts through the memory bank like a buzz saw: Figgie was a cold-blooded merger-and-acquisition machine who bought companies, chopped them up and then merged them with other businesses he'd beaten into financial shape. He made millions for his shareholders — and himself.

Figgie the company became famous for the tyranny of the boss, much the way General Electric became the world's most respected mega-corporation under "Neutron Jack" Welch, or the way Sunbeam reemerged as an industry castaway after hiring "Chainsaw Al" Dunlap. They all had one thing in common: Welch, Dunlap and Figgie made firing and laying off employees a tone-setter. They axed thousands of jobs, and dared remaining employees to drink from the well of inefficiency.

So Pantele understands Wilder's hard-core, no-one-is-safe managerial temperament. Last week, he experienced it yet again as the mayor forced City Council's entire legislative staff, and everyone who worked in the real estate assessor's office, to reapply for their jobs. Couriers delivered letters on official city letterhead to employees' homes explaining their jobs had been "voided."

It was classic Wilder intimidation. But like others who spend their time watching city politics, Pantele isn't prone to compare Wilder with Figgie. Figgie had a purpose, a mission: to build stronger, leaner businesses that made shareholders, well, rich. Everyone understood it, whether they agreed with his methods or not. Ditto for Welch, who fired at will but maintained that every business at GE would be No. 1 or 2 in their respective markets — and he established a leadership school that reinforced his belief in making his business managers entrepreneurs, giving them wide latitude to build.

What of Wilder's shareholders? If there's an endgame to creating upheaval in the assessor's office and with legislative staffers — in the throes of finalizing a city budget — Pantele says he hasn't a clue what that might be.

"He would beat the company into harmony with the benchmarks, then he put [the businesses] together again and beat them again. But there was an outcome that was desirable. There was a method to the madness," Pantele says of Figgie, for whom he worked as an in-house attorney in the 1990s. "Now, if you've got somebody beating just to beat, then that's a different matter. "

Articulating the endgame, Wilder's vision for the city, is a tough one. It clearly stumps Thomas Shields, director of the Center for Leadership in Education at the University of Richmond. Shields says Wilder has become more of a city manager without an overall mission that defines where he wants to take Richmond.

"If you went up to someone and asked, what's Wilder vision, what would they say?" Shields posits. To clean up City Hall, perhaps; to make the city safer, no doubt. But when Richmonders voted to change the city charter and subsequently elect Wilder as mayor, Shields says, they were voting for someone to lead Richmond as a region, to rise above the weak city-manager system of government, something Wilder hasn't articulated two and a half years into his term.

Shields is willing to give Wilder the benefit of the doubt. "He might have some grand vision that we haven't seen yet," he says.

Or maybe not. That there is no apparent mission or vision that the average Richmonder on the street, or even those working at City Hall, can articulate signals something is amiss, says James G. Clawson, a business administration professor at the Darden School at the University of Virginia.

In Clawson's book "Level Three Leadership," he discusses the six components of organizational charters that all employees — or in this case, Richmonders — should be able to articulate about the company they work for. It's all pretty basic stuff, such as the mission statement, the vision statement, strategy and operating goals. But the key, says Clawson, is that the average worker should have no problem reciting the charter.

"What's the purpose of this government, what's the vision?" Clawson asks. "If there are no answers for all of that, then you say, 'Well, OK, maybe we need someone else.'"

Building managers from within is also critical. Good tyrants, such as Welch, created a workplace where employees always knew where they stood. The city of Richmond? It's difficult to see similarities. The culture under Wilder has been one of constant fear and intimidation, according to some of those who have worked for him. Early in his term, Wilder was fond of saying as long as you do your job, you were safe — but ask any City Council liaison what that means, or, for that matter, ask the real estate assessor.

The effect? Pantele says the morale and fear at City Hall is so intense that the end result has been a massive "brain drain."

"In the counties you've got very stable administrative staffs. You've got a deep bench of very smart, capable people who have been there for a long time," Pantele says. "You look at the city of Richmond, and where are those people? You got 26 out of 28 [department heads who] are new. The departures are spreading lower in those organizations. Who is your senior management? Who are the deputies? To me, it's a major distinction between Richmond and the surrounding counties."

Sources say the talent left at City Hall — those with the ability to leave, i.e., the most capable managers, left early on. The turnover rate increased to a whopping 13.44 percent in fiscal 2006, up from 9 percent in fiscal 2004, the year before Wilder took over. In some departments, the turnover rate is higher than 50 percent, according to a recent analysis by City Council Chief of Staff Daisy Weaver.

It's something that's not uncommon in organizations run by "nasty people," according to Harvard business professor Bob Sutton, who published a book in February that makes the case for eliminating mean-spirited managers from corporate America.

His book, "The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn't," argues that companies can create far more stable, more efficient workplaces by not tolerating managerial bullies who use intimidation and fear tactics. Such bullies have always been embraced by the business community, or at least tolerated, in the name of healthy profits and soaring stocks. Sutton, in fact, argues the inverse. Nice managers, he writes, are almost always more effective.

Clawson says the jury is still out on the nice-guy approach. There is a place for hard-nosed, kick-ass chief executives, he says, so long as their purpose and goals are understood by the organization. They are often needed to make major change. But there's always a limit. When it reaches the point of being destructive — when the beatings are done for the sake of beatings — then an organization may be suffering from what's known as executive narcissism, a well-documented phenomenon wherein top-level managers abuse employees for personal pleasure and/or their own aggrandizement.

"If any leader takes what someone would call an asshole approach, the danger is you can destroy your relationships," Clawson warns. "The challenge is how far and how fast can you go? If you go too far, you'll tear the fabric." S

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