CEO Lesson: Decide First; Spin Second

We were having a small nuclear crisis in Vermont and Governor Richard Snelling convened a cabinet meeting which included me as Secretary of Transportation.  “First,” he said, “we have to decide what the right thing to do is; then we’ll think about the politics.  Otherwise we’ll just confuse ourselves.”  I’ve never heard another politician say anything like that.

Most businesspeople I know – including me - also have trouble separating the substance of a decision from the sound bite which describes it.  When I got hung up in decision making as a CEO, it was helpful to have Dick Snelling’s command to his cabinet to fall back on.  I’m sure my former staff are sick of hearing this story.

Snelling gave his command because his advisors were framing every possible course of action and inaction in terms of how it would be covered the next day in the Rutland Herald.  Trucking of nuclear waste through the state had already become an issue in the gubernatorial campaign.  The route and timing of an upcoming shipment had been outed; demonstrations were threatened.  We couldn’t think clearly about the issue – not that groups ever think particularly clearly about anything – because we were confusing the potential political fallout with substance.

The real issues were:

1. are the shipments reasonably safe (absolute safety doesn’t exist)?
2. are the shipments necessary?
3. what will happen if Vermont blocks the shipments?
4. what will happen if it doesn’t?

We had given permits for these shipments routinely in the past after careful examination of the safety issue.  The casks the waste traveled in would not rupture even in a high-energy accident.  The material was not explosive, of course, but it was radioactive.  Emergency response people were alerted when shipments went through; they were trained (although not tested) in what to do if there was an accident.  When there was no political issue, we had already decided that the shipments were safe.

The alternative to these shipments was that the waste stay at the power plants where it was generated rather than be safely reprocessed.  That was a bad solution then and it’s a bad solution now.  Nuclear power plants shouldn’t become waste storage sites.  Reprocessable waste (which is not all of it) ought to be reprocessed.  Vermont gets much of its power from a nuclear plant in Vernon from which we hoped to be able to remove spent fuel rods some day.  We didn’t want to be blocked by other states from shipping it out when that day came (note:  the spent rods are still at Vernon).  Radioactive medical waste is shipped from Vermont and other states for proper disposal.

If we blocked the shipments, they might have found their way through other states.  Vermont was only one of several routes being used.  One state had already banned shipments and the Regan administration had delayed taking action against them – much to our dismay.  There could easily be a race to the irresponsible bottom.  No state wants to be the only corridor for waste to travel through.

If we didn’t ban the shipment, there would be political damage.  But we weren’t allowed to think about that initially so we got back to the substance.  There WOULD be a large demonstration.  The route and timing were known.  There were threats from “activists” to block the shipment which would, of course, leave it sitting in Vermont.  We didn’t think of terror as much in the 1980s as we do now but it wasn’t good to have a shipment of radioactive waste stalled at a known location in Vermont.

Our decision was to ban the shipment whose secrecy had been compromised because that shipment was NOT reasonably safe but to make clear that future shipments would be allowed so long as security was maintained and Vermont didn’t get more than its fair share (that was a message to our friends in Washington).  The decision made, we then could think about how to announce it and how to minimize the political damage – we knew there’d be some.  The Rutland Herald gave reasonably good coverage, as I remember, to the substance of what we did but blasted us editorially.  Snelling won reelection easily – partly, because people trusted him to make unpopular decisions.

Leaders have to make decisions and leaders have to sell decisions – that’s what leadership is all about.  You don’t make the right decisions if you worry about how you’re going to sell them before you’ve made them.  You can’t think clearly about substance when you’re thinking about spin.  Conversely, you can think more clearly about selling and positioning a decision once you know you’ve made it for what you think are the right reasons.

Managing public companies for quarterly results is an example of decision making dominated by spin just as much as making political decisions by watching the polls.  Neither result in good governance.  Both are huge temptations.  We could use more politicians – and CEOs – like Dick Snelling.