In May of that year, at a shareholder meeting in downtown Pittsburgh, a Benedictine nun stood up during the question-and-answer session and accused O’Neill of lying. Sister Mary Margaret represented a social advocacy group concerned about wages and conditions inside an Alcoa plant in Ciudad Acuna, Mexico. She said that while O’Neill extolled Alcoa’s safety measures, workers in Mexico were becoming sick because of dangerous fumes.
“It’s untrue,” O’Neill told the room. On his laptop, he pulled up the safety records from the Mexican plant. “See?” he said, showing the room its high scores on safety, environmental compliance, and employee satisfaction surveys. The executive in charge of the facility, Robert Barton, was one of Alcoa’s most senior managers. He had been with the company for decades and was responsible for some of their largest partnerships. The nun said that the audience shouldn’t trust O’Neill. She sat down.
After the meeting, O’Neill asked her to come to his office. The nun’s religious order owned fifty Alcoa shares, and for months they had been asking for a shareholder vote on a resolution to review the company’s Mexican operations. O’Neill asked Sister Mary if she had been to any of the plants herself. No, she told him. To be safe, O’Neill asked the company’s head of human resources and general counsel to fly to Mexico to see what was going on.
When the executives arrived, they poked through the Acuna plant’s records, and found reports of an incident that had never been sent to headquarters. A few months earlier, there had been a buildup of fumes within a building. It was a relatively minor event. The plant’s executive, Barton, had installed ventilators to remove the gases. The people who had become ill had fully recovered within a day or two.
But Barton had never reported the illnesses.
When the executives returned to Pittsburgh and presented their findings, O’Neill had a question.
“Did Bob Barton
“We didn’t meet with him,” they answered. “But, yeah, it’s pretty clear he knew.”
Two days later, Barton was fired.
The exit shocked outsiders. Barton had been mentioned in articles as one of the company’s most valuable executives. His departure was a blow to important joint ventures.
Within Alcoa, however, no one was surprised. It was seen as an inevitable extension of the culture that O’Neill had built.
“Barton fired himself,” one of his colleagues told me. “There wasn’t even a choice there.”
This is the final way that keystone habits encourage widespread change: by creating cultures where new values become ingrained. Keystone habits make tough choices-such as firing a top executive-easier, because when that person violates the culture, it’s clear they have to go. Sometimes these cultures manifest themselves in special vocabularies, the use of which becomes, itself, a habit that defines an organization. At Alcoa, for instance, there were “Core Programs” and “Safety Philosophies,” phrases that acted like suitcases, containing whole conversations about priorities, goals, and ways of thinking.
“It might have been hard at another company to fire someone who had been there so long,” O’Neill told me. “It wasn’t hard for me. It was clear what our values dictated. He got fired because he didn’t report the incident, and so no one else had the opportunity to learn from it. Not sharing an opportunity to learn is a cardinal sin.”
Cultures grow out of the keystone habits in every organization, whether leaders are aware of them or not. For instance, when researchers studied an incoming class of cadets at West Point, they measured their grade point averages, physical aptitude, military abilities, and self-discipline. When they correlated those factors with whether students dropped out or graduated, however, they found that all of them mattered less than a factor researchers referred to as “grit,” which they defined as the tendency to work “strenuously toward challenges, maintaining effort and interest over years despite failure, adversity, and plateaus in progress.” [126] [127]
What’s most interesting about grit is how it emerges. It grows out of a culture that cadets create for themselves, and that culture often emerges because of keystone habits they adopt at West Point. “There’s so much about this school that’s hard,” one cadet told me. “They call the first summer ‘Beast Barracks,’ because they want to grind you down. Tons of people quit before the school year starts.
“But I found this group of guys in the first couple of days here, and we started this thing where, every morning, we get together to make sure everyone is feeling strong. I go to them if I’m feeling worried or down, and I know they’ll pump me back up. There’s only nine of us, and we call ourselves the musketeers. Without them, I don’t think I would have lasted a month here.”
Cadets who are successful at West Point arrive at the school armed with habits of mental and physical discipline. Those assets, however, only carry you so far. To succeed, they need a keystone habit that creates a culture-such as a daily gathering of like-minded friends-to help find the strength to overcome obstacles. Keystone habits transform us by creating cultures that make clear the values that, in the heat of a difficult decision or a moment of uncertainty, we might otherwise forget.
In 2000, O’Neill retired from Alcoa, and at the request of the newly elected president George W. Bush, became secretary of the treasury.1 He left that post two years later, and today spends most of his time teaching hospitals how to focus on worker safety and keystone habits that can lower medical error rates, as well as serving on various corporate boards.
Companies and organizations across America, in the meantime, have embraced the idea of using keystone habits to remake workplaces. At IBM, for instance, Lou Gerstner rebuilt the firm by initially concentrating on one keystone habit: IBM’s research and selling routines. At the consulting firm McKinsey & Company, a culture of continuous improvement is created through a keystone habit of wide-ranging internal critiques that are at the core of every assignment. Within Goldman Sachs, a keystone habit of risk assessment undergirds every decision.
And at Alcoa, O’Neill’s legacy lives on. Even in his absence, the injury rate has continued to decline. In 2010, 82 percent of Alcoa locations didn’t lose one employee day due to injury, close to an all-time high. On average, workers are more likely to get injured at a software company, animating cartoons for movie studios, or doing taxes as an accountant than handling molten aluminum at Alcoa.
“When I was made a plant manager,” said Jeff Shockey, the Alcoa executive, “the first day I pulled into the parking lot I saw all these parking spaces near the front doors with people’s titles on them. The head guy for this or that. People who were important got the best parking spots. The first thing I did was tell a maintenance manager to paint over all the titles. I wanted whoever got to work earliest to get the best spot. Everyone understood the message: Every person matters. It was an extension of what Paul was doing around worker safety. It electrified the plant. Pretty soon, everyone was getting to work earlier each day.”
1 O’Neill’s tenure at Treasury was not as successful as his career at Alcoa. Almost immediately after taking office he began focusing on a couple of key issues, including worker safety, job creation, executive accountability, and fighting African poverty, among other initiatives.
However, O’Neill’s politics did not line up with those of President Bush, and he launched an internal fight opposing Bush’s proposed tax cuts. He was asked to resign at the end of 2002. “What I thought was the right thing for economic policy was the opposite of what the White House wanted,” O’Neill told me. “That’s not good for a treasury secretary, so I got fired.”
5
Which Habits Matter Most
