American Business' Dirty Little Secret

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As part of the investigation into the security sclerosis that led to the intelligence breakdowns and failures on Iraq, it was reported in the New York Times on February 13th (registration required) that the "highly classified digest that provides President Bush with his daily intelligence updates is being scrutinized within the government and Congress."

It's certainly no surprise that the President gets the equivalent of a Cliff Notes briefing each morning. You didn't think that George was spending valuable time on the Internet, reading what Mickey Kaus and Andrew Sullivan had to say, did you? Nor is it a stunning revelation that those who shape the briefing shape his reaction, and thus have significant policy influence. As Douglas Jehl notes, "As much as any information the president receives from top aides, the daily briefing informs his view of the world, ranging across issues of terrorism, arms control, military events and more." You hire the people you want, and then you inhabit – and eventually are forced to defend – their info-world. A world where what is presented is less important than what is withheld, and where a narrowing of inputs, is the rule.

I see this as a large federal metaphor for what goes on every day in American business. CEOs are at the mercy of their inner circle (and sanctum) in precisely the same way as POTUS, which means that corporate intelligence failures are driven by similar realities. When you see a CEO make a bad decision, it's usually not because he or she is dumb or clueless. It's because the options are presented with so much internal spin and skew that it's difficult and time-consuming to sort through the layers of dis-information. Far too little attention is paid to the way that CEOs are manipulated and covertly re-directed by those close to them.

This level of insulation and protection around CEOs of large (and even middle-sized companies) is a dirty little secret of American business. Massive chunks of time are spent trying to figure out how to present a decision--or an unpleasant circumstance--to the fearless leader. While business doesn't generally think it has much to learn from Washington--feeling so superior in its free-market nimbleness and muscularity--I think that any number of large companies, from Disney to American Airlines to Boeing, would benefit from the same level of inquiry into their intelligence practices that the White House is about to undergo.