Ken Feinberg defines “risk” and “leadership”…

In some recent promotional items for the University of Pennsylvania – Wharton’s 2011 Leadership Conference, Ken Feinberg lets us all know about the risks of leadership, and he says:

“You have to define risk with each situation. When I pay a fisherman, I find a payment that ends their concern, but what is the likely risk that the Gulf is safe? Have I factored into that reward a good understanding of future risk to fishing in the Gulf? Inherent is the notion of a substantive definition of risk…When administering the 9/11 fund, it turned out that my evaluation of risk was poorly done — I underestimated the support of the victim’s families and the public in general. I evaluated correctly with the BP case — I’m a human pinata.”

He evaluated “correctly”…he “ends the concerns” of the fisherman…he has factored into the “reward” a good understanding of future risk to fishing in the Gulf.

Oh, and he’s a “human pinata.”

Okay, well, let me take a few more whacks at Mr. Feinberg…

In Ken’s claims payment methodology, he takes the rather controversial standpoint that everything in the Gulf will be back to normal by 2013, and in August of that year his plan is to close up the GCCF shop for good…

Yet, I read:

…officials with the U.S. Fish and Wildlife Service and the National Oceanic and Atmospheric Administration said assessing the damage from the BP spill is processing but that it would be another several years before a full evaluation is complete…

And if everything is improving, fishing wise in the Gulf, why do I read:

“Hundreds of angry shrimpers rallied on the steps of the state Capitol today. The focus of their anger: Ken Feinberg and BP. “Our livelihoods are at stake,” Acy Cooper told the gathered crowd. Cooper is the vice president of the Louisiana Shrimp Association, the organization that organized Wednesday’s rally. “None of us are going to make it through the winter time if we keep getting these prices. None of us.”

And if the businesses are all coming back, why am I receiving comments on this blog saying:

“I was one of the top yacht brokers in the panhandle. Annual growth of 35% to 65% annually. While yacht sales are up nationally ours are down 85% over 1st quarter of 2010. BP/Ken says that this is due to the poor economy. What they are doing to people and business here on the Gulf Coast is criminal. Why isn’t THIS on FOX or CNN? The news loves to talk about negatives like the spill but doesn’t seem to care about the actual people or the families they have impacted.”

You know what, Ken?

Sometimes people feel like pinatas not because they are making the hard choices, not because they are demonstrating great leadership, sometimes they feel like a pinata because they deserve to feel like a pinata. It certainly isn’t because you made “correct” evaluations with the oil spill. And judging by your quote at the beginning of this post, it makes me wonder if you consider your mistakes during the 9/11 fund to be less of what you did or didn’t do, but instead the fact you underestimated how many people were paying attention to the mistakes you feel you made:

“When administering the 9/11 fund, it turned out that my evaluation of risk was poorly done – I underestimated the support of the victim’s families and the public in general.”

Which begs the next question…if more people were paying attention to what you are or are not doing in the Gulf, would the expanding number of people who feel they are falling through the cracks then become mistakes? Do you consider yourself error-free down here simply because the people outside of the Gulf haven’t noticed? Or maybe a better way of putting it…Ken, if a tree falls in the woods and shatters your ego, and no one is around to hear it shatter, would it still make a sound?

Continuing on in the promotional materials, Feinberg also stresses the following characteristics of strong leadership when it comes to managing risk:

• Convey a sense of certainty
• Be transparent — “The more sunlight I let into the room, the easier it is,” he said.
• Consistency — no bias or favoritism
• Flexibility — keep an open mind
• Use sound judgement — “Give the people impacted by your decisions a say.”
• Delegate to good people — “Staff is the key.”

So, how did Ken do?

Convey a sense of certainty:

Yes, Ken has certainly conveyed a sense of certainty. When political leaders and claimants across the Gulf Coast region, and the Justice Department asked him to make certain changes in the way the GCCF operates, be it the speed of processing claims, openness with the claims process or not closing down the claims centers, Ken has certainly conveyed a resounding clear response, “No.”

Be transparent:

As I have previously written, see here, here, here, and here, Feinberg and the GCCF have never been about transparency. In fact, everybody from Congress to the Justice Department to the Attorney Generals of Alabama and Mississippi have been demanding more transparency, to which Feinberg says something along the lines of “Yes I could do better and I promise to do better,” but then he does nothing. As I’ve also previously commented, It would seem Feinberg is quite pleased with the job he has done, so pleased you would think he would take up Alabama Attorney General, Luther Strange on his offer of choosing a neutral party to look at the GCCF books, a confidential neutral party who then would report back to Strange an unbiased view of just how fair, impartial and accurate the GCCF process has been, but this would be another point where Feinberg has conveyed a certain sense of “No.” This is unfortunate. Until GCCF transparency dramatically improves, all we have is Feinberg’s word for it, which leads recent situations such as Feinberg making statements to the press claiming he has received no claims for health damages, only to have this statement undone a day or two later by himself. Complaints from claimants continue to come in via the press, editorials, and the comments sections of blogs, yet Feinberg’s transparency does not improve.

Consistency:

Mr. Feinberg could certainly be accused of a lack of consistency, and also of exhibiting bias and favoritism. One need only look so far as the whole working for British Petroleum thing, or remember when he wasn’t paying any final claims yet, except the $10 million claim he paid to a certain business partner of British Petroleum, at BP’s request, while everybody else had to wait? And even now, interim claims are not being paid while quick pays and final claims are, the two types of claims which most benefit his employer due to the signing away of the legal right to sue, so required to receive these payments.

Flexibility:

Keeping an open mind…like when he bases his payment methodology primarily on the work of one scientist who even disputes his own timeline conclusions that all will be back to pre-spill harvests by 2013. It takes a very open mind to ignore the scientific consensus predicting either: 1.) things will take many years to resolve in the Gulf, or 2.) it is impossible to know how long it will take. Ken kept an open mind through it all, until he found Dr. John W. Tunnel, Jr. who set the 2013 benchmark, though in his own report he writes “Realistically, the true loss to the ecosystem and fisheries may not be accurately known for years, or even decades…”

Use sound judgement:

Feinberg reports sound judgement to be “Give the people impacted by your decisions a say.” Okay, one might give this one to Ken. It was he who held all those town hall meetings where he gave dozens of people dozens of opportunities to give their opinions. Oh, and remember the public comment period for his methodology? Yes, that lasted two weeks and Feinberg swore that he read them all. Yes, Feinberg gave lots of people their say…course, I might argue that a better characteristic of leadership would be to not only give people opportunity to have their say, one might also want to listen too. Yes, it would seem listening would be very key…

Delegate to good people:

Like Guidepost Solutions? The ones who are doing the investigations on people who applied for quick payments despite quick payments supposedly being “no questions asked?” Also, I might suggest that you can delegate all you like, but if you close the offices so claimants don’t get any face time with the “good people,” you only set up another layer of frustration for those who are trying to be made right.

Ken’s ideas on what makes a good leader are certainly sound. I can’t nor will I argue too much with his choice of characteristics, but I do question the implication that Ken himself has demonstrated this kind of leadership. That is understandably being questioned throughout the Gulf Coast, as it should…

If the need to question it did not exist, would any of us be reading articles such as:

Action Report: Ferry operators balk at oil spill claim offer

Or:

Second lawsuit against Kenneth Feinberg filed in Florida

Or the previously mentioned:

Shrimpers rally at state Capitol

Probably not.

It would appear what Feinberg knows best about risk is how exactly to personify it to those who come to him for help, help in being made whole by British Petroleum, the company that pays his salary, and that is simply not leadership, that is abandoning ideas such as fairness, justice and judgement.

Have a nice day.

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