Leadership: Quixtar vs. TEAM

Dear Dick,

Forgive me for not posting for the past fortnight but I was away enjoying the warmth and love of family and friends. I hope you and yours enjoyed a similar time together and I wish you the best for the New Year.

While on holiday I gave some thought to leadership as it relates to the Amway/Alticor business mess and their attack on TEAM. Whenever I think of the DeVos family, I immediately think leadership. Clearly it took bright minds, hard work and decent leadership skills to develop one of the nation’s largest privately owned companies, a company that literally spans the globe.

TEAM is a world class leadership development service provider, and leads with a unique, best selling book on the science and art of leadership entitled “Launching a Leadership Revolution”. Let’s look into this.

During my holiday, I read a book by John MacArthur called “Twelve Ordinary Men.” I rather fancied MacArthur’s depiction of the elements of a great leader. He contends that any leader must have three elements: the right raw materials, life experiences, and character.

The first element, the right raw materials, remind me of those who appear to be “born leaders” in that they display a ‘leadership disposition’ very early in life. These people are insatiably inquisitive, they are willing to take the initiative, and they have a passion to be personally involved in the action.

The second element of a great leader, according to MacArthur, is life experiences. Almost all the great leaders in history overcame severe hardships at some point in their lives. Adversity builds strength. The United States Military Academy at West Point, teaches future leaders by repeatedly submitting them to adversity, not to break them, but to strengthen their fortitude.

The third element is moral character; aka: integrity, trustworthiness, respectability, unselfishness, humility, self-discipline, self-control, and courage. The USA’s current moral decline can be directly attributed to the lack of moral character in many of your leaders, particularly the Clintons. People simply cannot respect or trust someone with poor character, and no one will follow someone they don’t respect or trust.

Let’s look at the DeVos heritage in terms of leadership. Your dad, Rich DeVos, was at one time near the pinnacle of leadership. Without a doubt, he was born with the right raw materials. No one can accomplish what he did without a leader’s disposition; that willingness to take the initiative, a passion for action, and a definite fervor to discover better ways of doing things.

Rich clearly had the right life experiences. While we don’t know much about his early life, we do know that he developed the essential determination of a leader and overcame many obstacles in his early business experiences.

It goes without saying that early on, your dad was a model of good character and integrity. No one can lead people as he did, for as long as he did, without having the trust and respect of his followers. I pray that he is still the man he once was.

But what about the current leadership of Amway/Quixtar/Alticor? I do not know any of these people personally, so I cannot comment from personal experience. All I or anyone can do is examine their actions and infer leadership attributes.

1. Raw materials. I take this to mean personality style. There are countless summaries of personality types, and some are quite complex. One of the oldest (formulated by Galen in 190 A.D.) labels four basic styles: Sanguine, Melancholy, Choleric, and Phlegmatic. The Choleric personality style (or Jung’s ‘Intuitive’) is the category into which a so called “born leader” would fall - confident, fervent, passionate, aggressive, and impulsive. Given the aggressive and impulsive actions taken by the Alticor leadership over the last few months, I think it’s safe to assume the Choleric style reigns.

2. Life Experiences. There is no way for me to rate the life experiences of those in charge at Alticor. But when I look at your brother Doug, the current President of both Alticor and Quixtar, I can only guess. Let’s see; youngest child of a billionaire. The average person would think spoiled, pampered, indulged, and coddled. What difficulties has he had to overcome other than being the son of a powerful choleric? Where are the life lessons, the crucible of pain and struggle which is part and parcel to forming a leader?

I have no info on Jim Payne or Mike Mohr, the managers calling the shots at Alticor, other than what they’ve experienced in their positions there. When we look at what has happened on their watch over the last year, perhaps we can come to some reasonable conclusions.

Amway was sanctioned in India; could quite possibly be shut down in the United Kingdom, and had a mass defection (seven of the twenty members of the IBOAI Board resigned last year) in the United States. Let’s just conclude that Payne and Mohr’s life experiences have taught them nothing about intrapersonal skills, consensus building, and doing the right thing. They’ve demonstrated exactly the opposite.

3. Character. We can judge this on prior actions. Not actions taken years ago; just those within, say, the past six months.

The U.K. - The DTI threatened to shut down Amway in the United Kingdom, and Amway’s response was to blame IBOs. When Jim Dornan, leader of one of the largest IBO teams in the U.K. communicated with his IBOs on the actions taken by the corporation, he proclaimed full support of Amway’s actions and took his share of responsibility for the problems. In response, Amway chastised Mr. Dornan for “spinning” the facts of the situation and not taking full responsibility for the entire situation. In other words, Amway blamed Dornan’s group entirely for the actions taken by DTI, and claimed that Mr. Dornan should have admitted such.

As to their actions with one of their biggest and most loyal IBOs, Jerry and Mandy Scriven – I simply refer to Jerry’s post here.

Yep, that’s real character in my book—don’t miss any opportunity to pass the buck! (For those of you in Ada at the “executive” level, that’s sarcasm.)

The U.S.A. - Last August, seven of twenty IBOAI Board Members resigned from the board. Quixtar’s response? Blame Orrin Woodward and TEAM. Let’s see, in addition to Orrin Woodward and Chris Brady, the only Board members in the TEAM organization; resigned members include Billy Florence, IBO since 1973 and Board Member since 1989; Don Wilson, IBO since the 1970s; Chuck Goetschel, IBO since 1989; Bill Newton; Don Held; and Randy Haugen, IBO since the 1980s. In fact, every single resigned board member became an IBO before Orrin Woodward except Chris Brady. How is it that Mr. Woodward was able to influence these men to induce them to abandon businesses that have been built over decades? (Clearly, Mr. Woodward has and continues to exhibit real leadership!)

Quixtar’s response to this mass defection included: terminating the businesses of Woodward and Brady; terminating the businesses of three other resigned board members and Billy Florence; filing a restraining order against Woodward and Brady; sending emails to thousands of IBOs in the groups of the terminated leaders threatening legal action for affiliation with TEAM; sending emails to Platinums in the TEAM line of sponsorship threatening termination if signed commitment to cease all affiliation with TEAM is not received within HOURS; issuing press releases giving false statements as to the events leading to the termination of Woodward and Brady; and I could go on.

Nowhere do I see anyone under the Alticor umbrella taking responsibility for anything. No courage, no leadership. At best, Payne and Mohr’s admission of “guilt” is limited to “not being strict enough in monitoring IBOs”, who are as far as they are concerned, the ultimate cause of any and all problems.

And yet if I look at events leading up to so many of the IBOAI board member’s resignations, it is obvious (to everyone except Payne and Mohr) that Alticor bears substantial fault. In June of 2007, Alticor announced to the board that:
1) Quixtar is changing it’s name to Amway (in opposition to the unanimous vote of the IBOAI),
2) it’s changing bonus qualifications to reward retail sales over sponsoring,
3) it’s imposing strict sales quotas for IBOs,
4) it’s imposing harsh penalties for IBO mistakes,
5) it’s going to severely restrict and limit the use of Business Support Materials, and
6) it’s going to rescind all earlier promises that all changes which affect IBOs be submitted to and approved by the IBOAI Board.

Might any of these actions have anything to do with top leader resignations? Not according to Payne and Mohr.

My dictionary defines integrity as adherence to moral and ethical principles; soundness of moral character; honesty. As I looked this up, I remembered Johnson & Johnson’s handling of the Tylenol crisis in 1982. If you recall, some nutter in the Chicago area laced eight bottles of Extra Strength Tylenol capsules with cyanide; seven people died. Although no one employed by Johnson & Johnson was responsible for the tampering or deaths, J & J took immediate responsive action by pulling all Tylenol capsules nationwide and developing tamper-proof packaging and tamper-proof gel-caps. Tylenol’s market-share rebounded within a year, and they are now the world’s leading over-the-counter pain reliever.

The Tylenol case is a perfect example of how doing the right thing always pays off, even if it looks too expensive. The initial costs incurred by J&J must have been staggering, and yet the result was a public that knew they could trust J&J to offer safe products.

In contrast, Alticor/Quixtar/Amway has established a recent history of denial and blame-shifting, resulting in thousands of IBOs resigning their businesses and returning products. I suspect these resignations occur because the people believe they cannot trust the owners and managers of A/Q/A. The people Dick. The people who vote.

And, as is also clear, former top Amway IBO leaders do trust Orrin Woodward and Chris Brady.

Dick, you want to be governor of the fine state of Michigan. Michigan is going through some very tough times right now and needs a leader of character who is bold and not afraid to take the responsibility to do the right thing. YOU know what it takes to be a leader.

Why not start 2008 by stepping into the debacle at A/Q/A? Rescue Jim Payne and Mike Mohr from themselves, before they completely ruin your father’s masterpiece, spoil his upcoming 50 year celebration and dash all your chances for a political career?