Check out  this interview with William W. George, a professor of management practice at Harvard Business School in the New York Times.

It’s that time of year again. The time when yet another Beacon Hill politician gets indicted for corruption and the rest of us are left shaking our heads in dismay, wondering how a seemingly good guy could let us down – again.

Am I the only one who is not surprised by former Massachusetts House Speaker Sal Dimasi’s downfall? While many politicians are sincere in their desire to do good for their constituencies, much of the desire is also driven by an often large and vulnerable ego. Why else would you be willing to wake up at 6 AM to drive out to Worcester for a breakfast with telephone workers? These pols often surround themselves with people who provide constant affirmation. Eventually, they are drinking their own Kool Aid — believing their own hype. Is it any wonder, then, that they also start to believe that they are better than the system?

Fast forward to John Edwards, the disgraced senator from North Carolina. Before the story broke, who would believe he would risk his political career, not to mention his marriage and family, on a dalliance with a videographer involved in his presidential campaign?

The way Edwards, in interviews I’ve seen, explains the seemingly unexplainable is thus: He knew everyone thought he was good looking and charismatic and he started believing them. He was surrounded by an adoring group that included this attractive woman whose adoration made him believe he was above it all.

He – and Dimasi – are learning the very hard way that to think you are above it all is to risk losing it all. What they both needed was someone in their group of sycophants to tell them the truth, someone who was unafraid of telling it to them like it really is.

Or like it really was.

What do you think about Dimasi’s fall from grace? Let me know in the comments.

It’s always been amazing to me how many of the corporate leaders who get in to trouble with the law are otherwise — or at least started out as — honest, ethical people.

It’s an issue I’ve grappled with throughout most of my career in ethics (and one I blogged about a few weeks ago) : What made these people cross the line? Why do some people fall prey to temptation – ie money, power or cover-ups — and others don’t?

Leaders tend to be ambitious people but along with ambition comes the power of rationalization, which allows these leaders to devise self-satisfying — but incorrect — reasons for their behavior.

The truth is we all rationalize our actions all the time, even illegal ones, but the greater the ambition, the stronger the power to find reasons to justify actions that we know are not the right — or ethical — ones.

Leaders need to seek the opinion of others before making close-call decisions. One of the hardest barriers many leaders strive to overcome is the recognition that asking for advice is a strength, not a weakness.

Otherwise they just might see themselves on the six o’clock news.

Check out my full treatment of this issue over here.

Let me know what you think in the comments.

Business Week is currently running a special report on “Managing Talent,” a topic I have been focused on throughout my career. One of the featured articles in the series is titled “Motivating Without Money,” and, while the premise of the article makes sense, especially in these tough financial times, the suggestions offered are typical of the ways that consultants can frustrate managers with programs that are never as easy to implement as the authors imply.

For instance, the article suggests that companies can make employee recognition more personal by using a program that allows employees to choose a reward they want rather than having co-workers or managers make the choice for them. But what these “top-down” programs ignore is that the best motivation is having a personal relationship with one’s manager in which he or she acknowledges the current situation and engenders the employee’s trust that their interests are being looked out for.

How can companies do that? I’ve said it before and I’ll say it again: They have to first really understand what motivates individual employees (don’t make assumptions) and they have to systematically work through what may be causing the blockage in managers having the time (or ability) to have real conversations with their people.

It is the company’s job to be the enabler of the myriad of one-on-one conversations needed to maintain the motivation.

How do you motivate your employees in these financial times? Let me know in the comments.

It’s tempting to dismiss corporate leaders who make ethical missteps as immoral or inherently bad people. But the truth is, most of these leaders are, or at least started out as, honest, good people. What gets them into trouble?

It’s an answer I have been pursuing over 20 years of teaching and promoting business ethics. In fact I just blogged about it over at Charlie Green’s Trust Matters and what I wrote there is what I have witnessed time and time again among leaders in both the private and the public sector: Leaders who don’t prepare their motivational defenses are more likely to be felled by their own temptations, fears and powers of rationalization.

Leaders are ambitious, driven people who want to be successful. When their drives conflict with their values, they can easily rationalize their unethical behavior if (and this is the big if) they have not bolstered their defenses against these types of behavior. This is as simple as seeking guidance – and not just from subordinates who will automatically (and fearfully) give their assent to anything the leader proposes. The advice needs to come from someone the leaders trusts.

An ethical responsibility also falls on the company to set up processes so that leaders are forced to discuss these kinds of decisions – and check their rationalization impulses at the door.

I’ve said it before and I’ll say it again: Human nature isn’t going to change. But if we acknowledge its pitfalls, we can do a better job at managing it.

What do you think gets leaders into ethical trouble? Let me know in the comments.

And check out my guest post here.

An Op-Ed in The Boston Globe on business ethics recently got me thinking. On April 11, Gordon Marino wrote about “The Business of Business Ethics” and implied that it was the “business ethicists,” those experts on ethics who companies hired in droves over the past decade, who are somehow to blame for the moral failings of so many businesses now because of the experts’ silence in the face of unethical activities.

Marino is ascribing to these ethics officers power within an organization that I only wish they had. The truth is business leaders know the difference between right and wrong. Do they need an ethicist to tell them something is immoral or unethical? Absolutely not.

In my letter to The Globe, I wrote: “What today’s leaders really need is not an expert, but a modern equivalent of a medieval court jester, someone who can speak truth to power and remind the “king” that he is a mere mortal and subject to the same foibles as his subjects.”

The biggest ethics risks businesses face today is that business leaders can easily rationalize their unethical behavior – and no one is willing to stand up to them. That’s a deadly combination that has snared many good people in a trap of wrongdoing.

Read the full letter here.

Are ethics officers to blame for our current scandal-ridden business world? Let me know what you think in the comments.

Lately, I’ve been reading a lot about how to motivate employees. As layoffs hit industry after industry, everyone seems to be trying to figure out how to get the most out of the people they have left.

Over at Business Week’s Management IQ blog, Aili McConnon is intrigued by a workplace video game, Snowfly, that’s used to reward employees who meet or exceed expectations by giving them tokens to play the game. Employees accumulate points by playing the game, she explains, and they can be exchanged for prizes such as a pre-paid Visa card, a week of working from home or the use of the boss’s parking spot — when they’re on vacation.

Snowfly’s business is booming, but theirs is a simplistic view of what motivates each employee to do his or her best. If there’s one thing my experience working with companies has taught me it’s that, while motivating employees is crucial to an organization’s success, doing it effectively is trickier than it sounds and involves truly understanding what drives each employee to succeed. While prizes are nice – and seeing one’s car in the boss’ parking spot provides a temporary thrill — for many employees a bigger payoff is knowing their unique skills are making the difference in the company’s success, especially in these difficult times.

Only when we begin to understand that motivation comes in many shapes and sizes (and your company needs a good tailor to ensure it can be altered to fit each employee) can we hope to inspire the best in every one of our people.

The stimulus dollars are on their way to states all over the country, including my home state, Massachusetts. What could be better than money raining down upon state and local government agencies?

Well, for starters, an effective way to manage the risks associated with these payouts.

These agencies are under an enormous amount of pressure to spend the money quickly and, at the same time, adhere to the president’s mandate of accountability and transparency. After over two decades of working with companies on culture risk management, I know that the combination of performance pressure and the need for speed and accountability often leads to cutting corners at best and corruption at worst.

What these agencies need to do is take a page from the private sector: Acknowledge the culture risks and implement systems to manage them. This means that every manager — at every level — should be required to list the most likely behavior-based risks they will face. Whether it’s acknowledging a known political contributor who is also a likely bidder for a stimulus project or addressing a staffing gap, this is the most important part of figuring out how to manage that risk.

Creating an ethical culture that allows for diversity of opinion, standards and true accountability is the next step and has never been more important in the public sector. With some oversight, I believe it can be done.

What do you think? Let me know in the comments

Over at Harvard Business’ blogroll, Scott Anthony discusses how companies can foster innovation by making it cheaper — and less risky — to innovate, fail and try again. It’s an important notion and one which will more likely encourage innovation. But it is at the very bottom of his blog that he buries what I have seen lies at the core of a company’s effort to inspire innovation. He writes:

“Of course, it’s one thing for companies to say they embrace the right kind of failure. It’s quite another thing to create a culture that rewards low-risk failures and savors surprises.”

Time and time again, I see that one of the biggest root causes of a failed innovation program or process is the culture. Many companies fail to understand – and determine — how employees perceive the consequences of failure. Most employees or managers are not super-heroes who will stand up for a cause or idea, no matter the cost. If employees or managers hesitate to raise new ideas for fear of retribution, or even ridicule, the organization will lose many potential innovative opportunities.

It is the people-based risks that will determine the success of any innovation program and, in the current economic crisis, your people are the most important resource you need to develop and utilize. Check out my latest piece titled, “Creating a Culture of Innovation in Tough Times: How to Make the Most of What You’ve Got”

Let me know what you think in the comments.

Everybody, it seems, is steaming mad about the bonuses AIG is giving out to its employees on the taxpayer’s dime. Suddenly the “bonus culture” is being scrutinized – and found wanting.

In her article on the Wall Street bonus culture, ABC News’ Gigi Stone acknowledges that while the outrage over the AIG bonuses is justified – and distasteful considering the number of Americans losing, or just barely holding on to their jobs and their homes — there are still many who believe that bonuses are a necessary part of corporate America.

But really, how much more American can you get than giving out bonuses? It’s American capitalism at its best: We incentivize performance. And the best way we know how to do that is by financial motivation. Dangling the carrot of extra income inspires innovation, hard work and a motivation to do things better.

Stone quotes executive compensation consultant Steven Hall saying that bonuses can be very successful at driving positive behavior if – and this is the big if — they are “distributed in the right manner.”

The government can try to eliminate bonuses, but it won’t succeed. Can the bonus culture be made healthier and more effective? Yes it can, if corporate America would take a closer look at what actions it is actually “incenting.”

A perfect example of this is Enron. The now defunct energy company gave bonuses to managers who signed new deals for energy projects, without any bearing on whether the projects made economic sense or were ever actually completed. Obviously, that heavily influenced not only the types of actions managers took but also the culture of the organization. And look what happened to them!