Financial Crisis: Eroding High Standards

This article describes a common cause that’s behind some of the largest corporate collapses we have seen in history. Corporate collapses, particularly those caused by massive financial losses, are not often the result of a single action or cause, but rather a combination of factors. This complexity can often cover up the most significant aspect of what went wrong. A thorough investigation by people who know what to look for can often reveal lapses in standards, honesty and ethics long before the entire collapse of the organization.

These lapses often (but not always) begin at the top – with the leadership, and then filter down throughout the organization.

The Lower Truth Phenomena

We are writing here about businesses and organizations, however, this same scenario plays out in interpersonal relationships with a similar effect.

Whenever you work for or with a person who operates at a lower level of truth, honesty, values and standards than you do, you will be pulled down to their level of lower truth, honesty, values, and standards.

This does not happen overnight, it occurs slowly and insidiously over time.

Here is an example of this mechanism in operation:

Let’s say you are a high standard, high truth person who values honesty and you enter into a business partnership with another person. This can also occur when you work as an employee for lower standard management. In the following example, we are using a partnership where each partner has equal say. In situations where management has more say and power over you, this phenomena is greatly exaggerated.

Your partner purports themselves to be the same as you. They say they value honesty, have high standards, etc. On the surface, this appears to be true and you believe them.

Taking them at face value you proceed to invest a significant amount of money, time and energy in the venture. In the course of doing business, you make a lot of promises and agreements on behalf of the partnership.

When things are going well, everything is flowing and proceeding to your satisfaction. And then one by one, things begin to go wrong. There is no apparent explanation for the small failures, so you proceed forward regardless of the “taps on the shoulder.”

As things deteriorate, and more and more stress comes into the project and the partnership, you are unable to keep all your agreements and promises. This does not happen overnight, it occurs one small thing at a time. A supplier doesn’t get paid on or before the date promised. A client doesn’t get the exact order as promised. A team member’s salary is a few days late with no communication. A deposit is made late. A check bounces, etc.

Slowly but surely your high standards and ideals have been compromised and you find yourself out of integrity with yourself. This causes you to feel ashamed which can be very painful.

In order to deal with the pain of violating your high standards and ideals, the first thing you do is lower your standards and justify these lesser ideals. These lowering of standards come through your language as justification statements that sound like this: “Oh, you can’t do such and such in this business and be successful anyway,” or “Everybody has this problem in this business,” or “In this country, it is normal to pay a few days late and nobody takes any notice of it, so it is no big deal,” or “It is my intention that matters. I am not deliberately misleading people,” etc.

Eventually, a few days late on payments becomes 30, 60, 90 days, etc. If the cycle continues unchecked, you will even justify not paying people at all, in order to pay others. This is often called, “robbing Peter to pay Paul.”

The next thing that occurs is that you don’t get paid on or before the date promised. A supplier doesn’t get you the exact order as promised. A payment to you is a few days late with no communication. A deposit is made late. A check bounces on you, etc. In other words, what you have done to others comes back to be done to you…

For you, as a high standard person, you take all this very personally. Your partner appears upset too, however, is more aligned with these lower standards anyway, and will lower their standards further in order to “make it work.” This leads to conflict between you and your partner over keeping agreements and maintaining high standards of conduct and honesty.

At first, you take full responsibility that it must be your problem and your partner reaffirms this. Your partner somehow convinces you to be the front person as your standard of responsibility is higher than theirs. So they will naturally tend towards blaming you and abdicating responsibility to you.

As your standards continue to decline, it becomes more and more painful.

In order to deal with the pain, you lower your standards more and deny that you had higher standards in the first place. Before you know it, you are operating at a very low level of truth, honesty, and standards.  You are much reduced in your power, charisma and confidence to the point of giving up.

It is often at this point that the entire project fails and you experience a paradigm crash. Everything stops working.

To recover from a situation like this takes personal courage to review what actually happened and to reclaim your level of truth, honesty and high standards.

To maintain high standards, it is imperative to connect, work and associate with people of similar or higher standards than you.

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