While attending the CBRE Americas Summit last week in Las Vegas, the consensus among my peers is that it is taking longer and longer for deals to get done. Deals of all shapes and sizes are under increased scrutiny as executives are wary to put their stamp on anything that authorizes capital expense.
This is interesting given the Occupy Wall Street demonstrations and last week’s news regarding corporate cash balances. The Federal Reserve reported that corporate cash balances are now $2.05 trillion, an increase of almost $650 billion since Q1 2009. So if companies are flush with cash, why isn’t anyone making a decision and why aren’t job being created? Are they passing the buck? Are they afraid to put their neck on the line? Is it corporate bureaucracy? It may be all of the above.
As President of the United States of America, the Keynote Speaker at The Summit, President George W. Bush, wasn’t in a position to delay making decisions. During his 30 minute speech and subsequent 30 minute Q&A session, he gave us a glimpse in to what it was like to serve as the leader of the world’s greatest nation.
While I still don’t agree with all of the decisions he made while in office, I have great respect and admiration for the job and the process in which he approached the job. He talked about 9/11 and the economic meltdown in 2008 and how his focus was always on what was best for the American People and how to keep us safe.
He told a story during his speech about his father, George H.W. Bush (Bush 41). People asked him when he was in office if he approached his father for advice. He said he didn’t. He knew that if he asked his father for his opinion, his father would ask him to send his staff down for a week so he could digest all of the information and then form his own opinion based on the wealth of information they would provide. Not very practical, but there’s a point.
Being president is an impossible job. It doesn’t work unless you rely on those around you to provide their insights and opinions. Those people need to be the best and the brightest and if they aren’t, they are asked to move on and others take over.
Our corporate leaders need to do the same thing. They need to surround themselves with the best talent they can and either empower those people to make decisions (and have confidence that they will make the right ones) or act quickly when provided the facts. I understand we are in a volatile time. However, sometimes a lack of action is more harmful than making the wrong decision.
In a previous blog entry, I mentioned a client who stressed that the outcome wasn’t always as important as the process. In many corporations today, the decision making process is broken simply because no one will step forward and be accountable. Hopefully our corporate leaders will soon take a lesson from President Bush. Make a decision and stand by it.