Why Great Leaders Focus On Mastering Relationships 2/5/20, 11:49 AM

Why Great Leaders Focus On

Mastering Relationships
Douglas A. Ready March 06, 2019

Great leaders are distinguished by their ability to master personal

relationships.

“Without mastering collaborative relationships, both inside and

outside the company, we won’t produce the outcomes needed to
win our customers’ business.”

— Lori Beer, chief information officer, JPMorgan Chase

Mastering personal relationships that build trust and create a

collaborative work environment is central to leadership effectiveness in
the digital economy. This skill set distinguishes great leaders from merely
good ones, based on my interviews with C-suite executives in companies
around the world.

In a digital business environment, great leaders are those who appreciate

and understand the power of technology and analytics. But that alone is
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insufficient. They must also have the skills and mindsets to bring
together people from diverse businesses and functions to deliver
superior customer outcomes. As Lori Beer, CIO at JPMorgan Chase, says:

“We don’t need everybody to know how to write the perfect API,
but we do need people with a passion for working together to
create an understanding of how those APIs, a blockchain, the
cloud, AI, and machine learning can change the way you think
about delivering services to our customers.”

Why Mastering Relationships Matters

Great leaders have always done three things exceptionally well:

1. Inspire teams that continuously produce innovative, cost-effective

products and services that generate superior outcomes for
customers and shareholders.
2. Create inclusive working environments that foster collaboration and
employee growth and continuous development.
3. Conduct business responsibly to benefit communities and society.

In an increasingly digital economy, today’s leaders need to address each

of these leadership challenges with a renewed focus on relationship
building.

Inspiring teams to produce differentiated outcomes. In the digital

world, the idea of teams has both expanded and morphed dramatically.
Many companies today operate in an ecosystem world, meaning that they
might be a core platform in one environment and an ecosystem partner in
another. As such, companies can be both “team members” and
competitors with other companies. This dynamic requires not only
sophisticated legal arrangements but also a significant dose of trust and
relationship-building capability to operate effectively. Moreover, at the
intracompany level, as Beer explains, business leaders and functional

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experts need to build relationships across silos to spot new opportunities

and respond quickly to them. As Beer puts it: “If you can get to the point
where you don’t have to actually own and deliver all of the levels in the
stack, if you can trust the teams that are building them horizontally
across the organization, you can focus more attention on the top of the
stack, the 20% that is truly product- and customer-differentiating.”

Creating inclusive, employee-centered, collaborative work

environments. Companies will become talent magnets only if their
leaders place a premium on building relationships that empower
employees to raise their hands, create stretch goals, continuously
develop, and hold themselves accountable for their own career
development. This is critical to building a thriving community that
welcomes empowered employees. Collaborative relationships not only
are important to driving better results but also help build a more vibrant
working environment. Beer says: “Sometimes it feels like finding great
tech talent can be a challenge, but the more we pay attention to building
an inclusive culture, where people from highly diverse backgrounds and
perspectives can come together to work together, the more people are
energized and want to work here.”

Technologists and digitally savvy professionals have lots of options these

days and can choose the work environments that suit them, so
companies are working hard to build mutually beneficial relationships
with their employees so that they’ll choose them as employers.

Conducting business responsibly to benefit communities and

society. I’ve argued that the great, game-changing organizations are
those that strive to be simultaneously purpose-driven, performance-
focused, and principles-led. Companies aspiring to greatness in the
digital economy are no different. It’s usually easy for a company’s
leadership team to excel at one or even two of these aspirational
capabilities, but achieving all three at once is exceptionally challenging

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because of competing tensions that arise, for example, between profits

and principles.

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As companies digitize their business models and value chains, these
tensions take new forms (for example, privacy issues, unethical uses of
data, and biased AI). But digitalization doesn’t simply give rise to new
tensions. It also offers solutions to long-standing societal issues in health
care, education, and social justice. Apple, for example, has poured tens
of millions of dollars into ResearchKit, a digital mapping technology that
dramatically improves diagnostic capabilities of medical researchers.
Apple’s CEO Tim Cook readily acknowledges that Apple will most likely
never turn a profit with ResearchKit, but he feels using Apple’s
technologies in this way is better than writing checks through a charitable
foundation. Or consider Grab, a ride-sharing company in Indonesia, now
one of ASEAN’s fastest-growing and most successful companies. One of
the core tenets of the talent strategy of Grab’s executive team is to use
its technology to employ women from remote locations in rural areas,
helping lift them out of poverty. At JPMorgan Chase, Beer’s team leads a
program called Technology for Social Good, which runs coding
challenges for high school students, college students, and experienced
professionals who work alongside JPMorgan Chase employees to build
technology solutions for nonprofits. Employees continue the work beyond
the coding challenge, to build complete solutions that have helped more
than 1,000 nonprofits, touching millions of lives in communities across
the globe.

These leaders recognize that relationship building and building a better

world are deeply interconnected. In so doing, they also make their
companies talent magnets for workers seeking a sense of purpose and
meaning in the workplace. What is important to note, as Beer so
eloquently articulates, is this: As our work world becomes more virtual

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and our business models more digital, the key determinant of sustainable
success is less about the power of a company’s algorithms than it is
about the efficacy of the relationships we forge.

About the Author

Douglas A. Ready is a senior lecturer in organizational effectiveness at

the MIT Sloan School of Management, founder and CEO of the
International Consortium for Executive Development Research (ICEDR),
and MIT SMR guest editor. He tweets @doug_ready.

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