Excellence

Leadership VOLUME 1 ISSUE 3 MARCH 2006

THE JOURNAL OF HUMAN CAPITAL MANAGEMENT, ORGANIZATIONAL EFFECTIVENESS AND EXECUTIVE LEADERSHIP

“I am looking for [people] who have an

infinite capacity to not know what
can’t be done.” Henry Ford

Winning
at Work
Noel M. Tichy

Why Smart
Executives Fail
Sydney Finkelstein

Sometimes
Less Is More
Jeffrey Pfeffer and
Robert I. Sutton

Inspiring Others
Richard Boyatzis and
www.humancapitalinstitute.org Annie McKee

www.LeaderExcel.com
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 mes Smith Susan Anderson John Williams Jennifer Wilson Bob Brown Michael Davis William
ller Betty Thompson Helen Garcia David Taylor Dorothy Jackson Richard Thomas Miche
ee Irene King Kimberly Allen Joseph Martin Kenneth Thompson Will Mitchell Timothy Pere
Daniel Robinson Charles White Donna Robinson Carol Clark Ruth Rodriguez Don Walker
ephen Stewart Andrew Sanchez Ken Young Steven Hernandez Edward King Tim Roberts Jo
Turner Diana Thomas Ron Scott Anthony Green Sarah Hall Kevin Baker Jason Gonzalez
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awrence Foster Nicholas Gonzales Gloria Howard Janice Martinez Kelly Robinson Ben Griffi
nise Young Tammy Hernandez Howard Edwards Eugene Collins Emily Harris Wayne Perez B
berts Julia Brown Ruby Davis Jeremy Campbell Randy Evans Lois Miller Tina Wilson Phy
oore Gene Stewart Carlos Sanchez Robin Martin Russell Rogers Jacqueline Johnson Wand
Williams Martin Morgan Ernest Bell Annie Jackson Lillian White Jesse Rivera Craig Cooper
Sara Gonzalez Anne Smith Clarence Wright Sean Lopez Gary Wilson Beth Davis Margaret
homas Robert Jones Patricia Smith Dan Clark Paul Rodriguez Mark Lewis Donald Lee B
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Dave Anderson Liz Miller Tom Garcia Jen Moore Maria Taylor Chuck Harris George Hall
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Victor Cook Irene King Jane Wright Lori Lopez Rachel Hill Marilyn Scott Andrea Green
athryn Adams Louise Baker Jimmy Baker Fred Mitchell Alan Hernandez Shawn King Bonn
es Aaron Parker James Carson Chris Scott Johnny Green Earl Adams Norma Taylor Pa
derson Nancy Harris Ronald Hill Tony Adams Scott Edwards Kim Young Deborah Hernand
dy Scott Christina Lee Anna Barnes Mary Peterson Virginia Henderson Pat Cox Rick How
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Timothy Perez Raymond Morris Pete Torres Gregory Reed Amy Wood Walt Cooper Patric
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Excellence
Leadership VOLUME 1 ISSUE 3 MARCH 2006

THE JOURNAL OF HUMAN CAPITAL MANAGEMENT, ORGANIZATIONAL EFFECTIVENESS AND EXECUTIVE LEADERSHIP

It could be if it’s
FRED SMITH in the culture . . . . . . . . .12
Market Leadership
It starts with strategy LOWELL L. BRYAN
and execution . . . . . . . . .3 ANDCLAUDIA JOYCE
NOEL M. TICHY 21st Century Structure
Winning at Work Make your knowledge
Practice new ways workers productive . . . .13
of leading people . . . . . . .4
JEFFREY PFEFFER AND
DAVID ALLEN ROBERT I. SUTTON
Make It Happen Sometimes Less
Take five steps of Is More
implementation . . . . . . . .5
Avoid abuses of
CHIP R. BELL power and position . . . .14
When Leaders Cry JACK DALY
Aunthenticity makes
strong connection . . . . . .7
Culture by Design
You either design it or
PAUL BERNTHAL AND get it by default . . . . . . .15
RICH WELLINS
JUDITH GLASER
Growing Leaders
Align development
Power and Influence
with business needs . . . .8 Move forward together
in a healthy way . . . . . .16
SCOTT CAMPBELL AND
ELLEN SAMIEC WARREN WILHELM
You Can’t Learning Organizations
Sustainability is the
Win at Golf
result of learning . . . . . .17
with One Club
Learn to excel in BO BURLINGHAM
five dimensions . . . . . . . .9
Small Giants
GLENN WARING You don’t need to
Why CEOs Fail grow to succeed . . . . . . .18
Learn to take risks
and take losses . . . . . . . .10 RICHARD BOYATZIS
AND ANNIE MCKEE
SYDNEY FINKELSTEIN Inspiring Others
Why Smart “I am looking for [people] who have an
You can become a
Executives Fail infinite capacity to not know what resonant leader . . . . . . .19
They don’t learn
from mistakes . . . . . . . . .11 can’t be done.” Henry Ford
AUBREY DANIELS
ROBERT E. humancapitalinstitute.org
AND JAMES DANIELS
MITTELSTAEDT, JR. Measure of a Leader
Will Your Next Ask followers to
Mistake Be Fatal? assess effectiveness . . . .20
 D . I . R . E . C . T . O . R ‘ S
Prepare Now!
The new war for talent has begun.
by Allan Schweyer
A T THE 2006 WORLD ECO-
nomic Forum in Davos,
Switzerland, Samuel A. DiPi-
azza Jr., Global Chief Executive Officer, Price-
waterhouseCoopers, noted that in his 30
years of experience, he has “never seen such
an incredible shortage of, or demand for,
talented people—regardless of whether it is
in Germany, Brazil, China, India or Kansas.
… It is an issue even in countries with good
population growth and education,” he said,
“…There is this war for talent, and we are
not just talking about the top 5 percent.”
But today’s war for talent is different
than the last. It is less a case of across-the-
board worker shortages and more a matter
of finding, developing, and keeping the best
human capital—wherever it may be. This
decade’s human capital crisis may become
worse than last decade’s war for talent
because it is combined with a near-world-
wide demographic problem. Yet for a few, it
will be easier to manage because they have
taken steps to transform their traditional
human resources and recruiting practices
into proactive talent and human capital
management strategies.
Global Competition
Those organizations (and cities, regions,
and nations) that are most prepared today,
understand that competition for human cap-
ital is already global and that the global war
for talent will become increasingly fierce.
North America, Western Europe, and parts
of Asia will fight for human capital—just as
traditional supply countries like India and
China will fight to keep it. Even developing
countries will begin contracting in terms of
population and workforce growth. This has
already begun, sooner than expected, in
Russia, and will start in China after 2012.
Gradually, there will be very few countries
outside of India, the Middle East and Africa
with expanding working-age populations.
Winning organizations in North America
and Western Europe already have a global
workforce strategy in place or are rapidly
forming one. They are creating relationships
with universities, global partners, and
directly with worldwide talent now, and
they are learning how to build high-perfor-
mance global and virtual teams. Offshore
outsourcing is already becoming less about
6 L e a d e r s h i p
N . O . T . E
Leadership Excellence (ISSN 8756-2308) is pub-
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wherever it resides.
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The Human Capital Institute believes
that there is no more pressing economic or
business issue than being prepared for
Our mission is to promote personal and organi-
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sound ethics, and timeless principles.
human capital shortages (that in many pro- Editorial:
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ernment to develop appropriate talent Contributing Editors:
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Jim Loehr, Norm Smallwood, Joel Barker, Joseph
Grenny, Jim Kouzes
Future Is Here
In this respect, HCI’s inaugural National Executive Excellence Publishing:
Ken Shelton, Editor-in-Chief, CEO
Human Capital Conference and Expo is this Brian Smith, Managing Editor
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year’s most important event for profession- Benjamin Devey, Creative Director
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Our theme, “The Future is Here,” reflects Unbi Oh, Chief Financial Officer
the speed at which we are rushing toward a Johanna Donoghue, Sales Representative
Sean Beck, Chief Operating Officer
global knowledge economy, wherein com-
petitive advantage shifts away from physi- Human Capital Institute
Michael Foster, Chairman
cal assets and towards the game-changing Allan Schweyer, Executive Director
creativity, speed and agility of the workforce. Nigel Leeming, Chief Development Officer
David Forman, Chief Learning Officer
Keynote speakers include Richard Matthew Fumento, Chief Operating Officer
Florida, who is among the world’s foremost
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Executive Director,
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E x c e l l e n c e
 Leadership Marketing
handling a few shipments.
Executive Excellence names Fred Smith as March 2006 Leader Then it occurred to us that this
information was so valuable to us that
of the Month. Fred Smith is founder and CEO of FedEx. it might be equally valuable to our
customers. So, we developed a propri-

Market Leadership etary network and supplied clients

It all starts with smart strategy.
by Fred Smith
their sector, cross-referenced by search
engines. We’re seeing a spontaneous
combustion of economic activity
with PCs so they could monitor ship-
ments worldwide. Then we made that
tracking system available over the
Internet to everyone. As we add more
useful applications on FedEx.com, we
create more usage. We make it so easy
to ship things worldwide today—just
visit FedEx.com and click on the inter-

W HAT DOES IT TAKE because of this narrow-cast/broadcast

to start an enter- capability of the Internet—and it
prise and grow it to bodes well for growth.
national shipping icon, and FedEx
local trade manager will tell you exact-
ly what you need to do.
become a $25-billion company? It takes Radio Frequency Identification The global nature of business is
continual learning and discipline. (RFID) will have big impact on mak- playing into our hand. Today, the loca-
I synthesize ideas from different ing sales frictionless. Soon you’ll go tion of production is almost irrelevant.
disciplines—from technology, retailing, into a store, fill your shopping cart It’s simply just a cost/time trade-off.
and industry. I also read many hours a with product, pass through a scanning You can make your stuff anywhere—
week—and get ideas from members arch, and swipe your card. Wal-Mart simply calculate manufacturing cost
of our senior management team. We and others are pushing that capability. and transit cost.
don’t use consultants to tell us what to We at FedEx are a leader in apply- FedEx can still become a lot bigger.
do. We use consultants to help us do ing new technologies, like Pogo, the Possum, said, “If you want
what we know we need to do better. to be a great leader, find a big parade
To keep great talent on our leader- and run in front of it.” That’s what
ship team, I practice three rules: we’re doing to grow. We are adding
1) I don’t look over their shoulder— 200 locations in China alone!
they have the authority, freedom, and I have great confidence in human
flexibility to do what they need to do; ingenuity and entrepreneurship. We
2) they enjoy being part of a leader- will continue to see a lot of innova-
ship team that manages a global com- tion. The Internet will allow many
pany; and 3) we make it an attractive interesting things to be done that we
financial arrangement for them, as can’t contemplate today.
they share in the performance that
they produce. Three Components to CEO
I believe Alfred Sloan’s doctrine I view the CEO job in three parts:
that grew General Motors. He recog- strategy, management, and leadership.
nized different market segments and laser bar codes, scanning devices, and 1. Set a viable business strategy. I
used common technologies, materials, handheld computing devices. had a good friend, Abe Plough, who
and resources. He married you in a Originally, we were designed to move was a legendary entrepreneur. When
Chevrolet, buried you in a Cadillac, high-value and high-tech items with he was in his 90s, he asked me to
and had something for you every step great reliability and precision. As more come by and see him for breakfast. As
in between. I think the model of the of those items started flowing through I was leaving, he’d say, “Now, Fred,
Defense Department is similar—the our system, we soon needed a way to just remember—the secret to being a
Navy, Air Force, Marine Corps, and measure and monitor each transaction. good business is to be in a good busi-
Army seek to achieve their own mis- We had to embrace the IT revolution. ness.” He was right. You can have the
sions, but increasingly they collabo- We hired Jim Barksdale, one of the best of everything—but if you’re in a
rate. Many businesses have different people who commercialized the terrible business or have a bad strate-
divisions focused on market segments, Internet, as our COO. To keep up with gy, you won’t achieve a good result.
but seek synergy in offering those things, we invented the bar code You must have a viable strategy.
capabilities in a broader portfolio. tracking and tracing system. 2. Engage in the art and science of
Technology integration has come a When we first started, our hand- management. Carefully assess your
long way. The sales, marketing, and held devices were about the size of a strengths and weaknesses; where you
customer service experience are much breadbox. Nobody had ever printed are weak, bring in someone who is
better integrated. The Internet is pro- multiple-form, sequentially numbered strong. I have many weaknesses, but I
viding a standard, low-cost medium items so you could track and trace play to my strengths. I can do most
that people can use to sell, source, and everything through the system. We things in the management sector. I can
service things without regard to time did all that, miniaturized the handheld read a P&L and balance sheet, but not
and place. We are achieving impres- device, developed the world’s largest nearly as well as Alan Graf, our CFO,
sive numbers in our international radio system, and put them in our since I’m not a CPA. I understand the
business, because people can look at trucks, enabling us to handle millions basics of IT and aeronautics, but I
everything there is to buy and sell in of discrete shipments as if we were recruit experts, delegate to them a lot
L e a d e r s h i p E x c e l l e n c e 3
of responsibility, and express my con-
fidence in them. Still, you’ve got to
measure it, manage it, and check on it.
3. Build leadership at every level.
The small-unit level is where the rub-
ber meets the road—where you deal
with the customers. There you need
well-motivated, well-trained, and
committed people who meet or exceed
customer expectations. In the supervi-
sory ranks, you often have people who
are specialists. However, in the senior
management ranks, you must lead
strong-willed, intelligent, ambitious,
and smart people. You can find the
principles of great leadership practiced
in every great organization.
Leadership is challenging, since the
heart of leadership is subordinating
your self-interest to the greater good
of the team or organization. CEOs
must be able managers and effective
leaders. Where you’re strong, play to
that strength; where you’re weak,
recruit people who can help you.
You can’t be a CEO if you don’t
have a good strategy. I was always
convinced that the market demand for
our service was huge. So it was just a
matter of time and money. What we
do at FedEx is vital to the commerce of
the world. Without the fast-cycle trans-
portation capabilities that FedEx pio-
neered, the business models that have
changed the world would not have
been possible. The success of Wal-Mart
and Dell, for example, is largely due to
the power of starting small, dealing
with employees and customers differ-
ently, and having an iconoclastic dis-
tribution and transportation system.
I can’t think of anything else I would
rather be doing as long as my part-
ners, the Board, and shareholders are
happy with my performance. FedEx
today is fun for me because I enjoy the
three aspects of the job—strategy,
management, and leadership, I spend
more time on strategy and leadership
and delegate management functions.
Maintaining work-life balance is
part of the discipline that you need to
bring to your job. I have a great and
full family life, and I play tennis to get
my heart rate up. Executives who
work themselves into exhaustion or
incoherence lack the discipline to do
the job. I don’t take the job home with
me. I may take some reading home. I
enjoy reading history. In fact, my man-
agement style has been largely shaped
from my reading of history. LE
Fred Smith is CEO of FedEx. This article is adapted from his
interview with Chief Executive Editor-in-Chief Bill Holstein.
www.chiefexecutive.net
ACTION: Master the three components.
4 L e a d e r s h i p
Leadership Wins
Winning
at Work
Use three keys.
by Noel M. Tichy
W H AT S E PA R AT E S
winning organi-
zations from the also-
rans? I find that winners maintain
annual revenue growth and an operat-
ing return on assets—as opposed to
simply slashing payroll and expense.
Their consistent financial performance
enriches shareholders, builds commu-
nities, and provides greater opportuni-
ties for employees.
They are led by men and women
who nurture other leaders at all levels.
Even if you, as a leader, are smart
enough to anticipate and
prepare for massive eco-
nomic and social shifts,
you can’t respond to the
ground-level demands of
the moment without the
energy, commitment, and
ability of all your people.
The ultimate test of lead-
ership is sustained suc-
cess, which demands the
constant cultivation of
future leaders.
All the money you
invest in leadership development
means little without an equal invest-
ment of your own time and effort. If
long-term success requires more lead-
ers at more levels than your competi-
tors, then teaching, coaching, and
cultivating others becomes a strategic
imperative for senior executives. The
best leaders know that their success
depends on others, and that leading
and teaching are inextricable. They
spend hundreds of hours a year work-
ing with their colleagues—to share
ideas, identify needs, and develop
hands-on business expertise.
Three Keys for Leading
The ability to develop leaders
requires: a teachable point of view, a
story, and a well-defined methodology
for teaching and coaching.
1. Teachable point of view. As a
leader you must articulate a defining
position. You must talk clearly and
convincingly about who you are, why
you exist, and how you operate. You
need to have ideas on products, ser-
vices, distribution channels, cus-
tomers, and growth; and these ideas
need to be supported by a value sys-
tem that you articulate, exemplify, and
enforce. But you also need emotional
energy and edge—and generate posi-
tive emotional energy in others. You
need the edge to face reality and make
tough yes-or-no decisions. That is
your unique burden—at crucial
moments, when forced to act quickly,
to make the difficult choices. It often
makes you unpopular, which is why
those who need to be liked are seldom
effective leaders. Leaders must see
things as they really are and mobilize
an appropriate response. You can only
make those decisions and engender
that response if you have clear ideas
and values. Good ideas, appropriate
values, positive energy and edge—are
part of the package you present to
those you hope to develop.
2. Living stories. People organize
their thinking in the
form of the narrative
story. Individuals, fami-
lies, organizations, com-
munities, and nations all
have tales that help
make sense of them-
selves and the world.
Leaders can tell three
kinds of stories: 1) the
“who I am” story in
which leaders describe
themselves; 2) the “who
we are” story, in which
you articulate the group identity; and
3) the “where we are going” story. Use
the power of storytelling effectively
and put your people at the center of
your stories. Storytelling is the way
people learn from one another and
connect with one another.
3. Teaching methodology. To be a
great teacher you have to be a great
learner. Most effective teachers and
leaders will tell you that they grow as
much as those they teach and lead. The
process of teaching starts with having a
system for interacting with people. You
must be methodical but not mechanical
in your approach to teaching. To make
a difference, you must have the confi-
dence to be vulnerable to others; you
need to share your mistakes and
doubts as well as your accomplish-
ments. You can’t hide behind your
position—delivering a canned speech
to a training class and then escaping.
You must be genuine. Phonies and
martinets will be found out eventually.
E x c e l l e n c e
Learning to Teach
Articulating your ideas and values,
developing a teachable point of view,
and developing stories that bring your
views to life are all learnable skills. For
instance, to develop stories, think
about a time in your life when you
made something happen through
other people. Run the video of your
life and pick the proudest moment
you’ve had as a leader.
If you tell your story to someone
else, and then talk about why it was
an example of good leadership, you’ll
uncover the basic tenets of leadership:
“I had a vision. I persisted. I embodied
in my own actions the message I was
trying to create. I was able to enroll
people. I fought through resistance.”
Implicitly, we know what good leader-
ship is, and all people can become
more motivated to work on leadership
by remembering when they felt proud,
when they’d been in a tough situation.
Developing leadership talent is the
job of leaders. Share your values,
ideas, and stories with people. Outside
consultants can’t develop
long-term leadership tal-
ent. That is your job.
The conventional wis-
dom in leadership devel-
opment is to develop a
set of leadership compe-
tencies and then figure
out a way to develop
people around those
competencies. What’s
missing is the leaders
teaching colleagues.
People want their leader
to look them in the eye and say, “Here
is where our company is going, and
here is what we need from leaders in
order to get there.” Leaders need to
build a learning and teaching organi-
zation—one with the capacity to build
leaders and create an environment
where leaders are teaching leaders.
Leaders are both born and made.
With coaching, commitment, and hard
work, any group of people can
improve their ability. Any organiza-
tion that takes the time to get more
leadership out of people will be far
ahead of its competitors. Are all man-
agers candidates for the top job? Of
course not. But can they be a lot better
than they are now? Absolutely. We can
all hone our ideas and better articulate
our values and improve our capacity
for making yes-no decisions. So it’s
worth the effort to develop everybody.
Losing organizations handicap their
field of potential leaders and invest
their training and development
L e a d e r s h i p E x c e l l e n c e
resources only in those they think will Performance Execution
go furthest. Inevitably, they pass over
a lot of talent. Winning organizations
often bet their hunches, too, but they
typically wait longer to do it. They
Make It
look at broad leadership skills, not just
success with particular projects. And,
they continue to invest in the develop-
Happen
ment of everyone else. This more Execute a vision.
inclusive approach helps get the best
out of everyone—and keeps late
bloomers and mavericks contributing by David Allen
long after others have written them off.
The long-term success of leaders
can’t be measured by whether they
win today or tomorrow but by
whether or not their company is still
L EADERS MAKE THINGS
happen by first
framing a vision to
winning 15 years from now, when a define what done means and then
new generation of leaders takes over. making that vision operational—
deciding what doing actually looks
New Way of Leadership like. Few leaders can operate comfort-
Leaders of winning organizations ably in both roles and navigate effec-
use ideas, values, emotional energy, tively between them.
and edge to develop future leaders. Most leaders focus on framing the
They combine a teachable point of vision, crafting the purpose, capturing
view with a focus and personal role in and communicating the “spirit” of the
the development of others. organization. Actually getting things
Old Way: Coaching is done is then left to managers and
on day-to-day problems. front-line workers. In fact, some lead-
Development programs ers fail to see that making things hap-
are based on cases taught pen is their job.
by professors. Leaders But today the need for executive
proclaim values, often productivity is getting equal billing
superficial messages for with the need to foresee and create the
the masses. Training pro- future. Yes, you must know where you
grams deliver a sugar are going; otherwise, any road at any
high—by the time people speed will do. But just knowing where
return to work, the ener- you want to be is not enough to lead
gy is gone. Professional effectively—you must get there as effi-
trainers focus on time ciently as possible with the best use of
management and priority- limited resources. The how and when
setting, not on tough decision-making. and where are as critical for a leader to
Leadership focuses on technical skills. own as the why and who and what.
They sponsor development programs, Effective leaders work both angles.
parading in and out of them periodically. They unhook from the demands of
New Way: Coaching is based on the day-to-day operations to rise above the
leader’s own ideas, challenging people noise and gain clarity, direction, and
to create their own points of view. motivation. And at times they focus on
Development programs are practical, structures, projects, plans, and physical
based on real issues. Leaders help peo- action to execute the vision.
ple integrate their personal values
with the values of the workplace—and Five-Step Implementation
explain the paradoxes when values Our ability to get things done can
collide. Programs are ongoing, as lead- be expanded by knowing how we nat-
ers teach frameworks for motivation. urally take things from intention into
Leaders deal with people who do not reality. The five steps of implementa-
meet performance or value standards. tion create a model of how we get
Leadership focuses on hard and soft things done most effectively.
issues and on personal stories. Senior 1. Purpose and rules—defining the
executives lead portions of leadership game. Do we know what we’re really
development programs. LE about and why we do what we do? Is
it clear to us when something is off-
Noel M. Tichy is a consultant and professor of OB and HRM
at the University of Michigan, and director of the Global purpose? What do we really do? The
Leadership Program. He is author of The Leadership Engine, purpose defines the direction and
with Eli Cohen. Tichy@bus.umich.edu
meaning of the enterprise and sets the
ACTION: Tell (and teach) your story. rules we agree to play by—our stan-
5
dards. Whereas purpose gives us
direction, values and principles lay out
how we play along the way. We define
what behavior works and how we act
when we are at our best. When our
people know the purpose and commit
to the rules of engagement, we can
trust them to make decisions intelli-
gently, as needed. If we have doubts
about their behaviors, we can’t let go.
Where could a discussion of “Why
are we doing what we’re doing here?”
be used now in your organization?
With whom would it be wise to have
more clarity and agreement about criti-
cal behaviors? Strong leaders initiate
these crucial conversations on the front
end to prevent disastrous ones later.
2. Vision—defining the “what.” We
create a vision to reflect what the pur-
pose would look like in the real world.
How big, how soon? What would
make the endeavor wildly successful?
It is not necessary to have numbers,
dates, and times associated with the
vision, although they might be includ-
ed to give everyone a sense of scope
and scale. What matters is that the
image of success is clear and specific
enough to let you calibrate how far
you are from it.
We are all envisioning all the time.
But are the images we hold the ones
we want to achieve? Or are they pic-
tures that might be negative or limit-
ed? Are we holding a steady focus
toward an inspiring picture of the suc-
cess we really want, even if we don’t
yet see how to get there? Or are we
allowing limiting self-talk take hold?
Visions sometimes just happen, but
they can also be created, expressed,
clarified, fostered, enhanced, improved,
and expanded deliberately—and often
need to be—since the source of conflict
in implementation is that people work
off different mental pictures about
where things are going. The opera-
tional conflict can only be solved by an
agreement at the level of vision. Where
would a discussion of desired out-
comes be constructive?
3. Brainstorming—laying the
groundwork for “how.” We brainstorm
ideas and details of when, where, and
how in order to make the thing hap-
pen. The impulse to make the vision
operational surfaces questions and
sparks thinking. Capture all this think-
ing and catalyze idea-generation from
as many sources as possible, so no
vital perspective or detail will be
missed. Many an “oops!” could be pre-
vented with sufficient brainstorming.
But two things must be in place: align-
ment with the vision, and a consensus
6 L e a d e r s h i p
about the details of current reality. If could be dozens of next steps. But
you disagree about where you’re there must be at least one, or the pro-
going, brainstorming how to get there ject will be bottlenecked.
won’t help. And, if there is no consen- What has your attention now?
sus about current reality, the delta What’s the next action? Who has it?
between where you are and where you What plans need revisiting to determine
want to be will be unclear, and deci- who is doing what on the action pieces?
sion-making will be off the mark. Engaging in this series of events is
Where is there plenty of “blue sky how we all get things done, naturally,
thinking,” but not enough rolling up all the time. An intention initiates our
of the sleeves to grapple with things creative energy; an outcome vision
that are on the way and in the way? directs our thinking about details and
4. Organization—creating structures considerations; we organize the pieces
and plans. When several ideas have into a coherent structure; we take action
been generated and captured, a struc- steps to put the parts into motion.
ture will naturally emerge. Organize
the thinking into components, sub- Care and Feeding
components, priorities, and sequences As simple as this process may seem,
of events (logistics) for implementa- in complex enterprises these phases
tion. How do we get our arms around often need some care and feeding to
all this stuff? What’s the working blue- ensure effective implementation.
print we need to allocate our An ideal team has a mix of visionar-
resources? What are the deliverables ies and doers. It is rare to find any
that must be completed to achieve the leader or enterprise giving appropriate
objective? What are the mission-critical focus to all five implementation phas-
pieces versus the nice-to-haves? This is es. Use this model as a diagnostic tool.
Where are you in your thinking, deci-
sion-making, and implementation? Are
you focusing the attention at the right
horizon right now?
Often, projects and situations need
both more clarity and more constructive
action—and there is usually something
that leaders can do at these five levels to
grease the wheels. There is often room
to be more effective and efficient.
This model supplies you with criti-
cal guidelines for handling the opera-
tional side of your role, preventing
initiatives from getting stuck, and
ensuring effective allocation of knowl-
the arena for defining key projects and edge-worker resources. Organizing
tasks. What needs more organizing in without brainstorming can undermine
your world right now? a plan. Off-purpose action can be
5. Next actions—getting things chaotic. A vision without accountabili-
going. Decide next actions and who ty for relevant projects can be vacuous.
has them to create forward motion on Thinking at these levels of creative
all movable fronts of the project. Even development and decision-making
the best thinking is in vain without does not happen by itself—intentional
deciding and taking the actions energy is required to direct the focus at
required to make the vision happen. the right horizon at the right time.
What should take place, exactly, to get Leadership is often associated with
this thing going? Is this a phone call to vision—and rightly so. Someone who
make, an e-mail message to send, a has, holds, and communicates vision
document to draft, a task to delegate? will tend to rise to a leadership role.
Deciding the next action—and allo- But true leadership also gets things
cating responsibility for action to a done. Trust—a major element for real
specific person—is the final linchpin to leadership—is built not just by having
getting things done. Everyone must great ideas but also from bringing
know what done means (outcomes), them to fruition. A vision without a
and determine what doing actually task is but a dream, a task without a
looks like. The next actions on any vision is drudgery, a vision and a task
moving part (a component not depen- is the hope of the world. LE
dent on another unfinished piece) of David Allen is president of the David Allen Company and
the project need to be determined and author of Getting Things Done. www.davidco.com
allocated to yourself or others. There ACTION: Take these five steps.
E x c e l l e n c e
 Competency Emotional
the CEO?” It was the highest compli-
ment I could have bestowed on a

When Leaders Cry leader fond of saying, “Never add any

more leadership than is needed.”
Leaders without rank busy themselves
Authenticity makes a strong connection. with the business of mission and
course, not might and conceit.
Real leaders care about spirit. “This
by Chip R. Bell employee engagement and cutting- is the best work I have ever done in
edge breakthroughs. Turnover is lower my life,” said a colleague who had just
because people value an environment completed a difficult consulting pro-

D OORS ! THE SOUND free of passive-aggressive game play-

tech’s voice ing, cynicism, and suspicion. Custo-
boomed. And hundreds mers are loyal longer because they
ject. What I witnessed was not the
pride in his voice, but the lump in his
throat and the emotion in his eyes.
of employees poured into the giant trust what they experience. Suppliers Chores extract toil, but causes unearth
hotel ballroom. Room lights dimmed give better breaks because they view spirit. Real leaders care less about toil
as the spotlights bathed the massive encounters as long-term investments, and more about spirit. They see spirit
stage revealing a colorful, themed not short-term transactions. as a light that can easily go dim and
background. Sounding like the voice Real leaders don’t wear rank. view their role as helping associates
of God, the sound tech again spoke: Combat troops are better behaved in keep the rheostat turned up. They do
“Ladies and gentlemen, the CEO of the field (where battle is likely to this by constantly reminding them of
Acme Manufacturing, Jan Topdog.” occur) than in the relative safety of the the cause and by personally demon-
The CEO, scripted through a rear area. As an infantry commander strating passion about that cause.
teleprompter and supported by daz- in Viet Nam, I wondered if it was Great leadership comes from creat-
zling slides, gave the financial history related to the fact that military leaders ing a remarkable experience for associ-
and projected goals. The scene was ates. Real leaders know that if they
like a gazillion other big deal meet- constantly give employees their best
ings. But, this one was different. enthusiasm, zeal will be the response.
Without warning the CEO moved Real leaders invite passion. “You are
to the edge of the stage. The speech Interstate Hotels and Resorts,” said
changed from one of pragmatism to Vice President Jill Kallmeyer at her
passion. As the CEO began to talk about recent all-managers conference. “So
the power of the company’s vision and take personally every encounter with
the value of every employee, big tears every guest and every associate.” Jill is
began to fall to the stage floor. As the renowned for her passion for the
CEO completed the final sentence employees and customers. Real leaders
there was a long silence. The audience look for ways to add value “to every
sat overwhelmed by what they had encounter.” Instead of shouting an
just witnessed. Then, they leapt to order, they inspire with a story. Instead
their feet for a long standing ovation. of learning about customer experiences
Real leaders have the courage to be from a survey, they find out face to
authentic. It was not his tears that remove markings of rank while in the face and ear to ear. Instead of being
moved this audience—it was his field, since enemy snipers seek to get quick to blame, they assume the best
courage to be unabashedly authen- battlefield leaders in their crosshairs to and avoid assumptions. They are
tic—to be publicly real. Whether the strip their adversary of command. myth-averse, preferring to unearth the
emotion is anger, compassion, pain, or This left the concept of “leadership” facts, not rely on insinuations. Their
joy, the authenticity of leaders less related to obvious authority and “up close and personal” approach
changes the nature of the connection more with subtle influence. It also attracts passion for those around them.
and invites a valued link with others. took the focus off of “whom” and Margery Williams’ Velveteen Rabbit
Leaders too often associate their placed it squarely on “what.” Those contains great lessons for leaders in the
mantle of authority with a require- officers who resorted to barking dialogue between the wise skin horse
ment for detachment. “I don’t care if orders in a desperate attempt to signal and naive rabbit. “Real isn’t how you
my employees like me,” the swash- rank often found their edicts sabo- are made,” said the skin horse to the
buckling ruler announces, “I just want taged or circumvented by adroit foot rabbit. “It’s a thing that happens to
them to respect me.” Such a view is soldiers skilled at deception. you. It doesn’t happen all at once, you
often a preamble to emotional dis- Once I invited a fellow consultant to become. It takes a long time. That’s
tance and calculated encounters. The assist me with a group of senior execu- why it doesn’t often happen to people
pursuit of aloofness as the expression tives of a long-term client. She had who break easily, have sharp edges, or
of authority invites evasiveness, not heard me rave about the CEO of this who have to be carefully kept.”
enthusiasm. It triggers reserve, not company. Her flight was delayed and Realness comes through promoting
respect. An open-door policy is not the meeting was underway when she others, not on preening self. LE
about a piece of furniture. It is about arrived, preventing me from introduc- Chip R. Bell is founder and senior partner with The Chip Bell
Group. A renowned keynote speaker, he is the author of several
an attitude of vulnerability. ing her. After listening to the group in best-selling books including Magnetic Service.
Organizations with genuine lead- a spirited dialogue over a strategic www.chipbell.com
ers have more than their share of challenge, she asked me, “Which one is ACTION: Be authentic.
L e a d e r s h i p E x c e l l e n c e 7
Leadership Development
Growing Leaders
Might there be a shortcut?
by Paul
IT’S NATURAL TO MAKE DECISIONS USING
mental shortcuts. While these short-
cuts often save us time and yield
good results, they can get us into a lot
of trouble when selecting future lead-
ers. Basing leadership succession deci-
sions on gut instinct and mental
shortcuts is a sure recipe for failure.
Few organizations have succession
management plans that support the
development of future leaders.
Succession planning needs to go far
beyond choosing high-potential lead-
ers. From our 2006 Leadership Forecast,
we draw seven guidelines for success:
1. Align leader success profiles with
business needs. Development pro-
grams are most valuable when they
develop leaders in ways that address
your business needs. So, focus your
HR programs on leader success pro-
files (e.g., competency models) that
support the business model. For
example, if the business strategy
emphasizes creativity and innovation,
leader success profiles should include
behaviors that promote high employ-
ee involvement. We find that the top
priorities selected by leaders are
building customer relationships, con-
trolling costs, leveraging talent, and
maintaining or improving quality.
Start with your business priorities as
means for identifying what it means
to be a strong leader.
2. Accurately diagnose leader skills.
We find that three out of ten leaders
fail to demonstrate the skills and qual-
ities necessary for success. Most lead-
ers are good at bringing in results, but
they are less capable at bringing out
the best in their coworkers. After
defining leader success profiles, orga-
nizations need to objectively measure
leadership capacity. Doing so will pro-
duce an assessment of strengths and
development needs. Methods such as
360-degree assessments, roleplays, and
in-basket exercises provide a wealth of
information for development. Also
assess leaders online and through vali-
8 L e a d e r s h i p
driving performance.
5. Win the support of senior manage-
ment. Many senior leaders have come
to realize that their leadership strength
provides a competitive advantage.
When asked about their top priorities,
senior leaders selected “retain,
improve, and leverage talent” as their
most important priority (ranking above
Bernthal and Rich Wellins
growth and controlling costs). The role
dated personality assessments. of senior leadership in leveraging tal-
3. Base selection and promotion ent is critical when considering succes-
decisions on skills and motivation to sion management programs.
lead. Many decisions to promote indi- Three factors determine the quality
viduals into leadership positions are
based on their performance. Past per-
of succession management programs:
1) involvement of the CEO (or senior
formance is a good predictor of future leader); 2) involvement of line man-
performance; however, individuals agement to identify and develop can-
promoted into leadership roles often didates; and 3) collection of objective
face a different set of job demands for assessment data regarding employees’
which their past performance is not a current performance and readiness/
reliable predictor of future success. potential. Senior leaders need to men-
The two most common reasons for tor others, scout talent, and hold oth-
leader failure are poor interpersonal ers accountable for developing talent.
skills and personal qualities. Leaders 6. Include “learning by doing” options.
are typically promoted based on their In the past, designing and implement-
ability to get results, but they lack the ing development programs was fairly
rest of the package to back it up. straightforward. Today, leader devel-
opment has moved away from tradi-
tional training programs to ones that
take the learner out of the work envi-
ronment. The most effective develop-
ment efforts include special projects
and assignments where learners can
receive feedback when trying out new
approaches and skills. Formal training
and workshops are the most common
development resource, but they are not
the most valuable resources for
improving leader skills.
7. Ramp up the role of coaches and
mentors. The challenges confronting
leaders today are complex. The impact
When making internal promotions, of these forces on the lives of leaders
you need to assess skills relative to the has been dramatic—thus, the growing
job in question. Assessing the candi- need for coaches and mentors who can
date’s personality and motivation to provide individualized direction to
lead can help you predict the person’s help leaders identify their needs, focus
success in his or her new role. Use their behavior, and overcome obstacles.
testing, assessment, or other measure The specialized attention of a coach
of skills in developing leaders. provides leaders with an individual-
4. Identify leader potential early. The ized diagnosis of needs, feedback,
demand for strategic leaders is out- development planning, one-on-one
growing the supply, meaning you need training, and tracking of results. The
to identify and invest in people with leaders who have used a coach or men-
the greatest potential for growth as tor find it valuable. Clearly, coaches
strategic leaders. It will become more and mentors have a critical role to play
difficult to find new senior leaders in in the development of leaders.
the next five years. Few organizations By following these seven practices,
effectively identify high-potential lead- you avoid shortcutting your success.LE
ers early in their careers. An effective
Paul Bernthal manages DDI’s Center for Applied Behavioral
identification process focuses on the Research. Rich Wellins is a Senior VP at Development
hard-to-acquire skills, traits, and abili- Dimensions International (DDI), a global HR consulting firm
specializing in leadership. www.ddiworld.com
ties that characterize people who will
grow into strategic leaders capable of ACTION: Follow these seven guidelines.
E x c e l l e n c e
 Competency Dimensions
You Can’t Win at
Golf with One Club
E ff e c t i v e l e a d e r s e x c e l i n f i v e d i m e n s i o n s .
by Scott Campbell and Ellen Samiec
I MAGINE THIS SCENE : T IGER W OODS
arrives for the Masters with only a
driver in his golf bag. When asked,
“Where are your other clubs?” he
replies, “Well, my driver is my
favorite club, and I figured I could
just use it for all my shots.”
Many executives and leaders use
the same logic when leading their
teams; they use a single approach to
leadership—a command-and-control
style being the “club of choice.” Most
still buy into the myth: there’s one
right way to lead for all situations.
This article reveals five key dimen-
sions that leaders need to master.
Since IT, speed-to-market cycles,
higher employee education, and cul-
tural changes have rendered the com-
mand-and-control approach far less
effective, we propose that executives
try other clubs—such as servant lead-
ership, visionary leadership, and
coaching. There is no one right way to
lead that works in all situations. Rely-
ing on any one approach is like trying
to win at golf with just one club.
We define effective leadership as
achieving desired results through
people’s willing participation.
Effective leaders use five key leader-
ship approaches or dimensions:
Dimension 1. Commanding—taking
charge. There are times when
Commanding is not only acceptable,
it’s desirable. We define Commanding
as taking charge and seeking immediate
compliance to quickly effect a desired
result. The primary context in which
this dimension is needed is a genuine
crisis, particularly in turnaround situ-
ations or tragedies. In these circum-
stances, the need for quick decisions,
combined with employee insecurities,
call for a Commanding approach.
Rudy Giuliani’s remarkable leader-
ship during the days and weeks fol-
lowing 9/11 are a powerful testament
to the benefits of a Commanding
L e a d e r s h i p E x c e l l e n c e
approach during difficult days.
Although Giuliani had been at his
lowest ebb in opinion polls just prior
to the attack on the Twin Towers, his
reputation was salvaged (he even
won Time’s Person of the Year award)
due to his strong leadership in its
aftermath. His efficiency, aura of
authority, rapid-decision making,
inspirational words, and compassion-
ate actions toward the victims and
their families fit perfectly the needs of
the moment. The strength of his
Commanding approach allayed peo-
ple’s fears, renewed their hope, and
gave them an emotional anchor.
When the circumstances are dire—
during turnarounds and tragedies—
people look for Commanders. As Faye
Wattleton says, “The only safe ship in
a storm is leadership.” Extreme crises,
such as impending bankruptcy, extreme
and rapid loss of market share, or nat-
ural disasters or tragedies, require a
swift, definitive, Commanding style of
leadership. We need the determina-
tion, decisiveness, and toughness of
the “Crisis Conqueror” in such cir-
cumstances.
Unfortunately, many leaders rely
on Commanding in non-crisis con-
texts, resulting in low morale, high
turnover, and mediocre performance.
Many executives fail to see any con-
nection between these conditions and
their command-and-control approach.
Using a commanding style of leadership
when the situation doesn’t call for it caus-
es more problems than it solves.
Dimension 2. Visioning—pointing
the way. While you can command
short-term compliance, you can’t com-
mand ongoing commitment. One
powerful approach for fostering last-
ing commitment to excellence is
through the skilled use of Visioning.
As Peter Senge says, “Few, if any,
forces are as powerful as shared
vision.” Visioning involves creating and
effectively communicating a clear and
compelling picture of a worthwhile vision
for the group. Visioning is particularly
important in times of change.
For example, when Scandinavian
Airline Systems (SAS) was experienc-
ing a significant loss in profitability,
CEO Jan Carlzon employed various
means to create a new passion around
the vision of delivering outstanding
customer service each and every time a
passenger had contact with the airline. In
a single year, SAS turned a $20 million
loss into a $54 million profit! The air-
line went on to garner several awards
and, in Carlzon’s words, “The new
energy at SAS was as a result of the
20,000 employees all striving toward a
single goal every day.”
Visioning is also vital in keeping
people focused on long-range goals,
sustaining motivation, and tapping
into people’s deepest motivations for
performing with excellence. Visioning
is the leadership club that senior lead-
ers use most often.
Dimension 3. Enrolling—getting
buy-in. Margaret Wheatley states,
“People only support what they cre-
ate.” Enrolling involves creating buy-in
and commitment by genuinely seeking
input or employing democratic decision-
making processes. A skilled use of
Enrolling fosters high employee com-
mitment and leads to high quality
decision-making and production.
The history of Harley-Davidson pro-
vides a powerful example of the bene-
fits of Enrolling. While Commanding
had brought the company back from
the brink of bankruptcy, Enrolling sus-
tained and improved their perfor-
mance. Harley’s senior management
team began to elicit the ideas, con-
cerns, complaints, and dreams of all its
employees to foster continuous
improvement. The ensuing results at
Harley—sustained profits and
renewed market leadership—speak to
the power of Enrolling.
Enrolling involves eliciting, imple-
menting, and recognizing employee
ideas as well as facilitating consensus-
based decision-making. When he start-
9
ed leading IBM, Lou Gerstner drew on
the wisdom of his senior team in
reaching a new strategic direction.
Gerstner acknowledged that he need-
ed his senior team to fill in the gaps in
his understanding of the IT sector. His
capacity to draw out their best insight
and thinking was critical to the plan
that guided IBM’s turnaround.
Dimension 4. Relating—creating
harmony. We define Relating as creat-
ing and sustaining strong relationships
between you and staff members, and
among staff members, with the goal of
creating harmonious working relation-
ships characterized by mutual trust,
respect, and goodwill. The use of
Relating has positive payoffs.
Mike Abrashoff’s leadership as
Commander of the USS Benfold, an
awe-inspiring, guided-missile Naval
destroyer, provides an example of the
skillful use and practical benefits of
Relating. Under his leadership, the
Benfold went from having one of the
worst retention rates in the Navy to
100 percent re-enlistment, and having
one of the worst states of combat
readiness to winning the coveted
Spokane Trophy for best combat readi-
ness in the fleet. Abrashoff attributes
this success to the emphasis he placed
on his relationships with the crew.
Abrashoff learned the names, fami-
ly history, and personal story of every
one of his 310 crewmembers; instilled
a sense of each member’s personal
importance to him, regardless of their
rank; and attended to issues of har-
monious crew relationships and
potential discrimination. The Relating
dimension creates and sustains posi-
tive relationships.
Dimension 5. Coaching—developing
people. This dimension focuses on de-
veloping people’s potential and per-
formance while aligning their goals and
values with those of the organization.
Coaching is a key dimension for
sustaining employee motivation,
increasing retention, developing talent,
and expanding the leadership base
within the organization.
Just as great golfers use all the clubs
at their disposal, so too great leaders
use all five leadership dimensions—
the choice of dimension governed by
the context and desired outcomes they
wish to achieve. That is the real key to
achieving desired results through peo-
ple’s willing participation. LE
Scott Campbell is a speaker, author, consultant, and Director of
Training, and Ellen Samiec is the Director of Coaching for 5D
Leadership. They are co-authors of 5-D Leadership (Davies-
Black). www.5DLeadership.com, stories@5Dleadership.com
ACTION: Exercise these five dimensions.
10
Performance Failure
Why CEOs Fail
I see nine reasons.
by Glenn Waring
F OR THE PAST 12 YEARS,
I’ve worked with
hundreds of CEOs and
noted a positive side to failure.
Successful people fail more frequently
than others because they make more
attempts. Successful CEOs learn to
take risks and take losses in stride. So,
one answer to “why CEOs fail” is
“because they know that calculated
risks are necessary to succeed, and
such ventures will involve failure.”
Failures teach successful CEOs;
and, over time, nine lessons seem to
account for most of the learning:
1. An inability to see the bigger pic-
ture. If you’re being eaten by a lion, it’s
tough to see the lion. Some pressures
are industry-wide, even
global, and the CEO may
have to divest a core busi-
ness to succeed (John Teets
revamped Greyhound by
selling the buses). This is
difficult, and it is why so
many successful CEOs sur-
round themselves with
good peers and mentors.
2. An aversion to using
solid financial practices. A
CEO I know once shared
with me that he didn’t pay enough
attention to financials before he saw
his publicly traded company forced
into bankruptcy. The reason, he said,
was that the numbers would simply
“swim together,” overwhelming his
discomfort with financial indicators. A
CEO first has to see a compelling need
to learn how to avoid going broke.
3. A lack of clear vision. Successful
CEOs lead the organization to where it
needs to be, and find ways to get buy-
in at all levels. This is hard—other-
wise, all organizations would do it
well. Done right, clear vision can sub-
stitute for the field manual, empower-
ing everyone to make crisp decisions
in the company’s interest.
4. Lack of passion. Most organizations
no longer need arms and legs (command
and control); instead, they need hearts
and minds (sell and enroll). People
need to be led more than they need to
be managed. A lack of passion is usual-
ly burnout, which comes from solving
the same problem over and over.
When things aren’t going well, CEOs
need to face the difficult task at hand.
Successful leaders know themselves,
seize opportunity, and pursue mean-
ing. When I see a lack of passion in
otherwise successful CEOs, I gently
suggest that they revisit personal core
beliefs. The questions of Who am I? and
Why am I here? beg to be answered, and
if urgent tasks continually pull you
away from considering these ques-
tions, burnout and depression may be
the result. Passion matters, greatly.
5. Lack of clarity on the reasons for
success. Great CEOs hold their associ-
ates accountable for knowing what
activities cause results. CEOs focus on
what to do, and let associates take care
of the “how.” Then, associates regularly
monitor the activities that lead to suc-
cess. For a sales manager this might
mean counting and posting the number
of cold calls and referrals every week,
in addition to the actual sales results.
Champions win consistently because
they understand what causes a win.
Successful CEOs foster
innovative methods for
getting work done before
they let their associates
take care of the “how.”
6. Distractions such as
acquisitions. Successful
CEOs pay attention to the
central task—putting
the organization in
touch with reality, and
leading with clear focus.
7. Disconnecting from
customers. Some of my most success-
ful CEO clients are on the road over
half the time, talking to customers.
8. Disconnecting from employees.
The best leaders find ways to keep in
touch with their employees, not only
because they’re genuinely interested in
their lives, but also because they realize
there’s great knowledge in the ranks.
9. Integrity outages. I’ve heard
many people complain about leader-
ship that says one thing and does
another. Associates will tolerate no
more than about three inconsistencies
before they start to tune out.
My CEO clients teach me every day
what it means to be decisive and fully
engaged in life. I’m certain of two things:
Confusion is a precondition to learn-
ing, and losses accompany success. LE
Glenn Waring is President and CEO of EffectiveOrganization.com.
waringg@EffectiveOrganization.com, 888-299-2395
ACTION: Take risk and learn from failure.
L e a d e r s h i p E x c e l l e n c e

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 Performance Failure
Why Smart Executives Fail
Ta k e t h e t i m e t o l e a r n f r o m y o u r m i s t a k e s .
by Sydney Finkelstein
straightforward: Focus on a clear,
powerful goal that defines what victo-
ry would be for your company, mar-
with your company that there is no
clear boundary between personal
interests and corporate interests;
2) your CEO devotes excessive time to
fulfilling personal missions that do not
benefit the company; and 3) your CEO
tends to reinvest in initiatives that he
or she favors, despite your inability to
make those initiatives work.
4. Exhibiting executive arrogance.
Some executives are not only arro-

S IX YEARS AGO,
a research team at
Tuck Business School
shall all resources in that direction,
and never waver in your resolve.
In principle, strategic intent is a
gant—they are proud of it. People
who dealt with GM and IBM in their
glory days remember the condescen-
launched an investigation into what powerful idea. In practice, people just sion with which these companies
drives the success or failure of chief seem to get in the way. What looks regarded everyone outside their ranks.
executives. Our goal was not only to like a logical intent often breaks down Webvan, eToys, and most dotcoms
understand why businesses break when executives get caught up in “the made little secret of the disdain they
down and fail, but to focus on the peo- one big idea” fallacy. For example, for had for traditional businesses.
ple behind these failures; not only to the old advertising group Saatchi & Cabletron, Motorola, and Wang
understand how to avoid disaster, but Saatchi, being “No. 1” was the only believed they had the only technology
to anticipate the early warning signs of acceptable outcome, leading it to make worthy of being taken seriously.
failure. We wanted to expose the roots acquisitions where it had no capability. Here are three warning signs:
of breakdown in a definitive way. Here are three warning signs: 1) you 1) your CEO believes that your compa-
Some answers were as surprising have always used the same approach— ny can do whatever it pleases because
as the sudden fall from grace of many it has worked in the past, and it will of its dominant position; 2) your CEO
of the leaders we studied. In fact, work again; 2) you have your cus- seems to disrespect competitors and
many qualities that sound like the tomers figured out, as you have suppliers; and 3) your CEO elevates
attributes of a dream enterprise turn PR over strategic considerations.
out to be the basis for a nightmare. 5. Relying on past formulas for suc-
Many qualities we aspire to emulate cess. Executives often revert to harm-
turn out to be ones we are better off ful or inappropriate strategies as the
without. For investors, many sign- result of a “defining moment” earlier
posts of “success” turn out to be in their careers. It’s usually the one
markers for failure. Despite all that thing they are most known for—the
could go wrong, the real fiascos can thing that gets them their subsequent
be blamed on five causes: jobs, the thing that makes them special.
1. Choosing to ignore change. Once people experience this “defining
Companies that have been successful moment,” they tend to let it define them.
in the past often let their history and For William Smithburg of Quaker, the
culture take over—a combination that defining moment was his successful
closes down new ideas. When the promotion of Gatorade. He then tried
mobile telephone business shifted to repeat that behavior with Snapple.
from analogue to digital in the mid- known what they wanted for years; Here are three warning signs: 1) your
1990s, for example, formerly domi- 3) you run your overseas business just CEO tends to make the same decisions
nant Motorola was slow to respond. as you run your domestic business—if repeatedly; 2) your CEO tends to shut
Hence, Nokia became market it isn’t broken, you don’t fix it. down lines of inquiry that differ from
leader—a position it still holds today. 3. Identifying too closely with com- his preferences; 3) your CEO seems
Motorola—along with Rubbermaid, pany. While most investors and unconcerned with all that could go
Wang Labs, and General Motors—was employees would like their leaders to wrong in his strategic initiatives.
fully aware of how the market was be fully committed to their jobs, most How often do we take the time to
shifting but chose not to do anything egregious mistakes occur when execu- learn from mistakes? People run orga-
about it. This finding calls for more open- tives are too closely connected to their nizations, and they are subject to bias-
mindedness in companies, including companies. Such executives treat the es, pressures, and misjudgements; yet
open discussion of mistakes, negative company as an extension of them- the price they pay for these mistakes
feedback when warranted, and a cul- selves—and act accordingly. can be immense. If we do not learn, we
ture that heeds three warning signs: 1) For example, Samsung’s chief exec- are destined to fall into the same traps.
you can’t figure out why your com- utive Kun-Hee Lee decided to enter Knowing why smart executives fail
petitors seem to be successful; 2) you the automobile industry (a $3 billion enables us to choose a different path.LE
focus on one element of the business mistake) simply because he liked cars.
Sydney Finkelstein is the Steven Roth Professor of
at the expense of others; 3) you create GM’s former CEO, Roger Smith, Management at the Tuck School of Business at Dartmouth. He
excuses for why you don’t listen when devised a plan to combat Toyota by is the author of the best-seller Why Smart Executives Fail,
(Portfolio, 2003). He can be reached at
your customers ask for something. embracing robotics. sydney.finkelstein@dartmouth.edu
2. Brilliantly fulfilling the wrong Here are three warning signs:
vision. The notion of strategic intent is 1) your CEO identifies so completely ACTION: Heed the warning signs.

L e a d e r s h i p E x c e l l e n c e 11
Performance Culture
Will Your Next Mistake Be Fatal?
Create a culture that learns from its mistakes.
by Robert E. Mittelstaedt, Jr.
W E ALL LIKE TO THINK
that “yes, we
make mistakes, but we
learn from them and go on.” Unfor-
tunately, individuals, teams and orga-
nizations rarely learn as much as they
should from mistakes. Why are some
leaders better at recognizing mistakes
early, correcting them, and learning
from the experience without major
damage? The answers are more con-
sistent than you might realize.
Three Mistake Patterns
Most mistakes are related to execu-
tion, strategy, and culture. Some are
driven by individuals, but most really
big blunders are team
efforts. While the
specifics differ, the pat-
terns are similar.
Consistent patterns
include: ignoring warn-
ing signs; dismissing or
rationalizing away cer-
tain data; failure to
communicate; failure to
seek assistance; disbe-
lief of the serious
nature of potential or
unfolding conse-
quences; and failure to
take timely action.
1. Execution mis-
takes. Execution mistakes occur when
there are no or inadequate procedures
developed in advance; a failure to fol-
low established procedures; or a situa-
tion that no one has seen previously.
Examples of execution mistakes include:
• The March 2005 explosion at BP’s
refinery in Texas City, Texas that killed
15 workers, injured 170 others, and
damaged the plant. To their credit, BP
rapidly announced that the disaster
was the result of a series of opera-
tional and planning mistakes.
• The launch of the Optima card by
American Express. AmEx had to write
off $265 million because they assumed
that AmEx customers would have
fewer credit problems when allowed
to carry a balance. This was not true.
The assumption mistake was com-
12
pounded by a denial of facts followed
by attempts to cover up the truth
while trying to fix the problem.
Neither of these mistake chains was
life-threatening for BP or AmEx, but
both were wake-up calls. Mistakes are
costly, and compounded mistakes
have costs that rise exponentially.
2. Strategy mistakes. Strategy mis-
takes exhibit similar patterns; howev-
er, strategy mistakes are more likely to
be life-threatening and usually result
from ignoring signals.
For example, Kodak, a pioneer in
digital technology, would not acceler-
ate the killing of their chemical-imag-
ing cash cow. Not until 2002, when
Kodak film sales had the first year-
over-year sales decline in history,
did the board consider that
change was inevitable.
Kodak ignored the sig-
nals and chose to
believe that film-based
imaging would domi-
nate the industry
longer. Kodak’s accep-
tance of the digital rev-
olution came late, but
at least it came. This
will save the company,
but Kodak will never
again be as profitable
or as dominant.
3. Cultural mistakes.
Culture creates an
environment that is
conducive for either mistake creation
or avoidance.
Here are a few examples:
• Johnson & Johnson. Almost 25
years after the handling of the Tylenol
poisoning situation, J&J is still the gold
standard for a culture that stays
focused on doing the right thing.
• NASA. They exhibited the best and
the worst of “we must get there,”
despite signals that danger lurked in
the wings (literally in the case of
Columbia). The same culture that facil-
itated amazing accomplishments bred
arrogance and reduced safety.
• Enron. Modest success in the
pipeline industry combined with easy
money led executives to believe they
were destined to greatness. The “we
can do anything” culture that devel-
oped became a corrosive force of
destruction when ethical and legal
lines were crossed in the quest for
ever-greater accomplishments.
• McDonald’s. The Golden Arches
lost their luster when diversification
and competitive distraction caused the
company to lose sight of what had
made them successful. Returning to a
focus on the proper execution of the
core business was required.
Learn-From-Mistakes Culture
Too few leaders study and learn
from mistakes, but this painful exercise
can be a source of power and competi-
tive advantage. To learn from your
mistakes and those of others, make the
following commitments:
1. Do not stop taking risks. This is
the easiest way to avoid mistakes, but
taking no action is often the biggest
mistake of all, especially when it
comes to strategy.
2. Require analysis of mistakes and
learning. Charge those involved in
analyzing what happened and why,
along with the learning points that
need to be understood by others.
3. Learn to recognize the pattern of
mistakes. Prepare your people to rec-
ognize these patterns before a disaster
happens. Train for different scenarios.
4. Fly the airplane. Airplanes have
crashed simply because of pilot dis-
traction. When confronted with a
potential crisis, ask, “What is the most
important thing I should be doing?”
5. Establish and enforce standard
operating procedures. A major cause of
problems is the lack of standards or
failure to follow standards that are set.
6. Never ignore customer data. Your
customers are your best market sens-
ing mechanism. Ignore what they tell
you at your peril.
7. Create a culture with a purpose.
Most cultures develop by accident.
Those that are designed to accomplish
a purpose are more effective. Does
your culture do what you want it to?
8. Understand economic forces and
laws. Industry economics change over
time. Track your likely future econom-
ic environment. You can’t violate the
laws of economics for long.
You will make mistakes—if you
don’t, you are not taking enough risks.
But you can make fewer of them, catch
them early, and learn from them. LE
Robert Mittelstaedt is dean, W. P. Carey School of Business,
Arizona State University and author of Will Your Next
Mistake Be Fatal? (Wharton School Publishing) from which
this article has been adapted. Robert.Mittlestaedt@asu.edu
ACTION: Assess your culture.
L e a d e r s h i p E x c e l l e n c e
 Performance Productivity
resources are well invested. Once an
initiative is ready to be scaled up, it

21st-Century Structure can be placed in the line structure.

Get the best from your professional knowledge workers.
by Lowell L. Bryan and Claudia Joyce
current earnings.
Create an enterprise-wide gover-
nance mechanism for decisions that
cross line functions—such as manag-
3. Develop knowledge marketplaces,
talent marketplaces, and formal net-
works to stimulate the creation and
exchange of intangibles. These markets
and networks help your professionals
exchange knowledge, collaborate, and
develop communities that create
intangible assets. They not only mini-
mize the search and coordination costs
of professionals who exchange knowl-
edge and other valuable intangibles

A BOUT 50 YEARS AGO, PETER DRUCKER

coined the term “knowledge
ing shared IT costs. Clarify the deci-
sion-making authority of each
but also maximize the opportunities
for cost-effective, productive interac-
worker” to describe people whose basic member of the senior leadership team. tions. Moving into knowledge market-
means of production was no longer Take vital support functions, which places, talent marketplaces, and formal
capital, land, or labor but, rather, the demand focused management, out of networks will make all three more
productive use of knowledge. the line structure, so that specialized effective. A knowledge marketplace
Today, these knowledge workers, professionals can run these functions helps members of a network to
or professionals, represent a high per- as shared utilities. Defining roles con- exchange knowledge, which strength-
centage of the employees in many sistently helps the people in those ens the network. A talent marketplace
companies. These talented people roles to interact and collaborate. works better if the people who offer
undertake most key line activities, 2. Manage dynamically. Dynamic and seek jobs in it belong to the same
innovate new ideas, and produce and management—a combination of disci- networked community.
manage the intangible assets that are plined processes, decision-making 4. Measure performance. Rely on
the primary way companies create protocols, rolling budgets, and calen- measurements of performance (not
value and compete. And yet these supervision) to get the most from self-
people often find their work obstruct- directed professionals. Relinquish
ed. Creating and exchanging knowl- some supervisory control and let peo-
edge and intangibles through ple direct themselves, guided by per-
interaction with their peers is the formance metrics, protocols, standards,
heart of what they do. Yet most values, and consequence-management
squander endless hours searching for systems. Accountable leaders must
the knowledge they need—and coor- measure performance, even as their
dinating their work with others. workers become more self-directed.
To boost the productivity of your What’s needed is inspired leadership,
professionals, you must modify your not more intrusive management.
vertical structures to let different In terms of motivating desired
groups of professionals focus on clear behavior, measuring performance is
tasks—line managers on earnings, for more important than providing finan-
instance, and off-line teams on longer- cial incentives to reward it. Tailor met-
term growth initiatives—with clear rics to individual roles and people. Get
accountability. Then create new net- dar-management procedures—makes the metrics wrong, and unintended
works and marketplaces that make it it possible to manage the portfolio of behavior is the result. Create metrics
easy for professionals to interact col- initiatives as part of an integrated that hold people individually account-
laboratively and find knowledge. approach. This forces leaders to make able for their contribution to collective
resource allocation trade-offs, explicit- success—an idea we call holding people
Four Design Principles ly, rather than allowing them to be mutually accountable.
You can build this new structure, made by down-the-line managers. A company that tries to simplify its
reduce the complexity of interactions, Ongoing tasks—such as launching structure without helping self-directed
and improve collaboration by imple- new products, building new business- professionals to collaborate easily
menting four design principles: es, or redesigning a technology platform might increase its efficiency, but
1. Simplify the line structure. —call for small groups of full-time, decrease its effectiveness. So, we invite
Clarify the reporting relationships, focused professionals with the freedom you to design a new model, using new
accountability, and responsibilities of to discover winning value proposi- principles that take into account the
the line managers who make good on tions by trial and error (deductive tin- way professionals create value. By fol-
earnings targets, for all other consid- kering). Few line managers have the lowing these principles, you will get
erations will get short shrift until time or resources for such a discovery. more value, at less cost, overcome the
short-term expectations are met. Devote about 2 percent of spending challenges, and capture the opportuni-
Eliminate matrix and ad hoc struc- and some of your best talent to devel- ties of today’s economy. LE
tures that muddle decision-making oping longer-term strategic initiatives. Lowell Bryan is a director and Claudia Joyce is a principal in
authority and accountability. Narrow Each major one should have a senior McKinsey’s New York office. www.mckinsey.com
the scope of the line manager’s role to manager as its sponsor to ensure that ACTION: Boost your productivity.

L e a d e r s h i p E x c e l l e n c e 13
Ethics Responsibility
goes up. People will not expend effort
for leaders they don’t respect.

Sometimes Less Is More 3. Inhibiting others from taking

responsibility. Orpheus, the Grammy-
award winning chamber orchestra, has
B e s e n s i t i v e t o t h e s u b t l e e f f e c t s o f p o w e r . been much studied because it operates
without a conductor—it is musician-
centric rather than conductor-centric by
design. Ronnie Bauch, managing direc-
by Jeffrey Pfeffer and Robert I. Sutton
tor of Orpheus, says that the conductor-
tion to help guide what their subordi- centric or leader-centric organizations
nates do. The best leaders make their have many problems. One difficulty is
presence felt. But surveillance makes that after a while, everyone pays atten-
people nervous and cause them to tion mostly to the leader—who is, after

W E SEEM TO BE OBSESSED
with a particular view of what
leadership entails, as exemplified in
expend energy dealing with the moni- all, in control. So, people stop listening
toring. Too much control saps initia-
tive, and surveillance undermines
as closely to each other. They stop hear-
ing suggestions that don’t come from
this quote about GM’s CEO: “Rick intrinsic motivation and the joy of the top. Hence, they lose a lot of infor-
Wagoner’s aura envelopes the planet. mastering a task on one’s own. Some- mation and wisdom.
His every move sends ripples around times getting out of the way of great Second, there is a bad dynamic in
the globe. His every decision affects the people and letting them do their jobs which leaders take on responsibility,
actions of millions in countless coun- is the best thing a leader can do. others cede responsibility to leaders,
tries.” This view of leaders as central 2. Bullying and self-centered behav- who in turn take on more responsibili-
figures, active, making decisions, and ior. People who get paid great sums ty, which leads others to cede even
controlling outcomes persists in spite compared to others, receive adulation more control and responsibility, and
of Jim Collins’ description of more in the press, and have their every the cycle continues. In Orpheus, with-
modest “level-five” leaders. whim catered to and their every word out a conductor to make all the deci-
Many positive benefits accrue to parsed are, unless they are extraordi- sions, people are compelled to learn
leaders from the belief that what they how to do public relations, fundrais-
do matters a lot. First, if leaders are ing, programming, hiring, and other
the central causal agents determining things usually left for the leader to do.
performance, then the enormous rise By contrast, in places with strong lead-
in corporate CEO compensation (to an ers, people tend to cede decisions and
average of about $10 million or 533 activities to that leader—why bother
times average salaries) is justified. making suggestions or taking on tasks
Second, people tend to want to if you will be overruled or if the task
ascribe self-enhancing attributes and will get redone by the leaders?
effects to themselves. When people Third, because people take on fewer
believe they have been involved (even tasks and try to influence fewer deci-
peripherally) in making a decision or sions in the presence of dominant lead-
creating a product or project, they ers, they obviously don’t learn as
believe the result is better as a way of many things or as well. Practice and
justifying their involvement. experience, coupled with knowledge
For followers, there are also advan- nary beings, likely to believe their own and training, are the best teachers.
tages from a belief in the potency of press and think of themselves as pow- Without engaging in fund raising or
leaders, as it produces a sense that erful, almost omnipotent, people. public relations, without feeling
events are actually under the control Power tends to distort the behavior of responsible for making decisions, peo-
of the leader. those in power, causing disinhibition ple don’t engage in these activities
All of this might be a harmless half- and a lack of sensitivity to others. For and, as a consequence, don’t learn how
truth—except that it affects what peo- instance, people in powerful positions to do things nearly as well.
ple in leadership roles do, the decisions are more likely to tease others, to
they make, and their effects on others. stereotype those in less powerful posi- What’s a Leader to Do?
tions, and to attend to their own needs Effective leaders do four things:
Six Harmful Effects without considering the effect on oth- 1. Act and talk as if they are in con-
Here we highlight some of the ers. Descriptions of the behavior of trol and project confidence about the
more harmful effects, which make former New York Stock Exchange future. When Steve Ciesinski was CEO
placing too much faith in leaders and CEO Richard Grasso and former of the resume-processing software
leadership a dangerous half-truth. Warnaco leader Linda Wachner detail company Resumix, the company had
1. Overcontrol and monitoring. The acts of rage and vengeance that leave to redesign its product even while
cultural stereotype of leadership and subordinates fearful and resentful. maintaining the commitment of its
leader behavior produces many lead- People who are fearful don’t take en- customers and keeping its employees
ers who believe they ought to ask trepreneurial or risky actions. People during the dot-com boom. Although
questions, provide guidance, give lots who feel stereotyped, abused, and bul- the company faced many challenges,
of positive and negative feedback, lied are not likely to be engaged in and Ciesinski always told the truth and
and provide information and direc- motivated by their work. Turnover provided a path and program for the
14 L e a d e r s h i p E x c e l l e n c e
company that offered some assurance
of a successful future. The company
was eventually sold to HotJobs at a
good price, because of the confidence
that Ciesenski projected.
2. Take credit and blame. When
Gary Loveman, CEO of Harrah’s
Entertainment, made a bad decision
about the company’s health insurance,
he went around the company telling
everyone that the decision was his,
that he knew the decision caused
employees expense and inconve-
nience, and that he would fix it. His
behavior serves as a role model for
accepting responsibility, for admitting
mistakes, and for letting people know
that bad outcomes can be fixed.
3. Know when to get out of the way.
Leadership does involve getting things
done through and with other people.
Being too ubiquitous, too much in con-
trol, causes problems. If you tell every-
one what to do all the time and monitor
their every action, why bother hiring
talent? The best way to train yourself
to get out of the way is to have lots of
direct reports. This guarantees that
you can’t possibly oversee each one
too closely. Hire people who can do
their jobs without close supervision.
When you have talented people, you
don’t need to do their work for them.
4. Be sensitive to the effects of
power on the powerholder. Knowing
that power causes people to do weird
things, shrewd leaders mitigate this
tendency. Some, like George Zimmer,
CEO of the Men’s Wearhouse, have
advisors, including people in the spiri-
tual community, who keep them cen-
tered. Others avoid the perquisites of
power such as private dining rooms
and reserved parking, and associate
more with front-line employees to
keep in touch. Some embrace the
ideals and behavior entailed in ser-
vant-leadership, the idea that the best
leaders have customers they need to
satisfy—the people who work for
them—and that leaders succeeds only
to the extent that their people thrive.
Understanding the effects of leader
behavior can help senior managers
avoid dangerous half-truths, build
more effective organizations, have
more satisfied and fulfilled employees,
and have more fun themselves. LE
Jeffrey Pfeffer is the Thomas D. Dee II Professor of OB at the
Graduate School of Business at Stanford University and
author or co-author of 11 books including The Knowing-
Doing Gap. Robert I. Sutton is Professor of Management
Science and Engineering in the Stanford Engineering School.
They are coauthors of Hard Facts, Dangerous Half-Truths,
and Total Nonsense (HBS Press). 650-723-2915,
Pfeffer_Jeffrey@gsb.stanford.edu
ACTION: Practice these four behaviors.
L e a d e r s h i p E x c e l l e n c e
Culture Design
make daily decisions, you hamper ser-
Culture vice and lengthen the sales cycle.
2. Training should be an integrated
process. Training is an inside job—not
by Design something to be abdicated to an out-
side provider. While an outside firm
can provide clarity of direction, help
Or is yours by default?
to design the training process, and
provide for interval course correction,
the ultimate day-to-day responsibility
by Jack Daly
for training rests inside the company.
3. Recognition systems—don’t leave
Y OU CAN SMELL A
culture. How does
your culture smell?
“thanks” to chance. Put systems in
place to ensure regular recognition.
Imagine an outsider asking your asso-
Does it smell good, or does it stink? ciates, “By a show of hands, how
Do you have a culture by design, or by many of you are ‘overly recognized’?”
default? At times, it can be difficult to People are starving for recognition,
identify your culture, since you are and the recognition doesn’t need to be
part of it. Spend 30 minutes at a com- heavily weighted financially. In fact,
pany, and you can describe the cul- one of the most powerful recognitions
ture. Every company has a culture, so is the age-old handwritten note.
identify the key factors you seek and 4. Communicate. Knowledgeable
manage them accordingly. companies communicate, and they do
When I think of leaders and culture, it proactively and consistently.
Herb Kelleher and Jack Welch come to Howard Schultz, Chairman of
mind. In Southwest Airlines Starbucks, is constantly
and GE, we have two com- reminding the company
panies where the leaders that even though it is big
established a culture and and successful, that does
worked to ensure it perme- not mean Starbucks can’t
ated the enterprise. While execute each cup of coffee
both leaders and companies better. Share the news and
were effective in establish- realize that communica-
ing their respective cultures tion involves both talking
and delivering solid bot- and listening.
tom-line results, their cul- 5. Recruit and hire the
tures were different in best—and start them right.
design. But, designed they Think “culture first, expe-
were. Culture headliners at Southwest rience second.” You can train people
have been fun, empowerment and team- in the business; however, attempting
work. At GE, we see training and com- to retrofit people into a culture is a
munication as the headliners. Herculean challenge. Invest consider-
Companies that “manage their cul- able time in the recruiting and screen-
tures well” over time consistently out- ing process, as opposed to just filling
perform companies that don’t. Revenues an empty seat. Once you find the win-
increased 682 percent vs. 166 percent; ning hire, implement an orientation
stock prices increased 901 percent vs. plan so that the new hire isn’t just
74 percent; net income increased 756 thrown to the wolves, or ignored.
percent vs. 1 percent; job growth Create a work environment that is
increased 282 percent vs. 36 percent. challenging, satisfying, and fun.
I’ve identified three ingredients of Storytelling-can be the most effective
their business successes: vision, key tool to ensure the culture message res-
people in key spots, and culture. onates. People often forget concepts,
but remember stories. So, spend more
Five Design Mandates time sharing stories that underscore
Here are five ideas to jump-start your desired culture. Stories are sim-
your design of a winning culture. ple, timeless, and memorable.
1. Be who you are. Winning cultures What percent of your time is spent
reflect who the leader is and the com- on designing and implementing your
pany’s core values. A shared mission culture? Don’t rush to the urgent at
and values can be liberating—empow- the expense of the important. LE
ering your associates with confidence Jack Daly is an executive coach, speaker, and the author of sev-
and trust to make the right decisions. eral books. www.professionalsalescoach.net
If people have to refer to a manual to ACTION: Design your winning culture.
15
Leadership Power
Power and Influence
Decipher the language of leadership.
by Judith E. Glaser
P OWER IN THE WORK-
place has tradition-
ally been defined as
force, dominance, assertiveness,
strength, invincibility, and authority.
As we observe others rise to higher
levels of leadership, we ask ourselves
“How do they do it?” Our observa-
tions can easily lead us to conclude
that the most powerful (most domi-
nant) make it to the top and that the
rule of thumb is that to rise to a lead-
ership position, we must bring into
play our behaviors of force, domi-
nance aggression and strength.
However, power and leadership
are being redefined. No longer are we
comfortable equating leadership with
force, and power with dominance. In
forward-thinking corporations, power
is shifting from I-Centric to We-Centric,
and this shift requires a commitment
and a plan of action.
Throughout history, leadership has
been critical to performance, to suc-
cess, and to the greater good. The
“leader” is often perceived as a soli-
tary, charismatic figure, similar to a
movie star. People behind the scenes
are often not acknowledged, despite
the fact that all play critical roles!
Who of us wants to be the actor on
stage and who wants to be behind the
scenes? Who of us sees ourselves lead-
ing initiatives to successful conclu-
sions? We each must choose our roles.
The distinction between the leader
and others is not a gender distinction.
Women can rise to leadership posi-
tions, as long as they understand how.
In the movie 9 to 5, administrative
assistants are initially intimidated by
their boss’s arrogance and allow him
to take credit for work they accom-
plished. The women finally ban
together to create a force he is unable
to reckon with. They take over their
workplace and create an environment
in which they and others thrive.
In Working Girl, Melanie Griffith
plays an administrative assistant to a
female boss, who steals her ideas and
presents them to impress a business
partner. When her boss falls on a ski
16
slope, Melanie moves into position to
represent her idea in her most charm-
ing, tactful way, and to show her boss’s
true deceptive colors in a public forum.
All of us, both men and women,
face similar challenges every day: How
to bring our leadership ideas, voice and
talents into the world without step-
ping all over others? How to exercise
our talents in a world with other tal-
ented executives through fair and hon-
est interactions and dynamics, without
one-upping, stepping all over each
others’ toes, deceptively undermining,
intimidating, taking credit from
other’s success, or self-promoting.
Dominance and Submission
In the climb up the ladder of lead-
ership, we need to find ways to move
up to the next level. How we influence
others along the way will determine
how we climb. How do we use our
power and influence in ways that cre-
ate support around us?
Learn how to positively influence.
The meaning of influence ranges from
the dominant and authoritative, to the
more important and significant. At one
end, it is being influential because of
“fear.” At the other end, it is being
influential out of recognized impor-
tance, significance, and contribution to
the greater good. To be recognized as
important—to have others see our tal-
ents and reward us—is the challenge
that we all face in the rise to the top.
How can women get recognized?
Why do women have more difficulty
making it to the top? Women have as
much ambition as men. On the rise to
the top, however, women tend to
experience more obstacles along the
way, and over time their ambition is
diluted, obfuscated, and mitigated. We
give-up and give-in—since fighting for
what we want gets exhausting. When
the obstacles feel like they are too big
to overcome, we look for other
avenues to fulfill our dreams. We leave
and tell ourselves it’s just not worth it.
Men get rewarded and chosen more
often because men have a more domi-
nant voice. Women start careers with
the same level of ambition, yet
encounter forces that challenge their
strength and tenacity to make it to the
top. One challenge comes from the
hardwiring differences of men and
women—how each responds when
something they desire is taken away.
Men and women respond different-
ly when they face the loss of a desired
object—a job, a car, a paycheck, a pro-
motion, or a project. When something
men desire is taken away, they tend to
become more aggressive and go after
what they want. Males are more domi-
nant and will go into fight behaviors
more easily and quickly than females.
Females are more submissive in the
face of loss. They may respond by cry-
ing, calling for someone to come to
them. The female instinct is bonding.
Rather than turning to their aggressive
responses, women are more inclined,
when a desired object is removed, to
want others to comfort them. The pejo-
rative labels of submissive, acquiescing,
unassertive, deferential, and meek are
often given to women.
These are both truths and stereo-
types, yet we are influenced by these
beliefs. The challenge of women rising
to positions of importance remains our
power-puzzle to be worked out.
Here are some guidelines: Create a
feedback-rich culture to establish healthy
relationships. Make beliefs transparent.
Create communication signals to move
forward together in a healthy way.
Shift from an I-Centric to We-Centric
behavior and mindset. Emotional IQ:
Self-awareness and self-management.
Collaborative IQ: Ability to build
mutually beneficial relationships with
others. Innovative IQ: Making the
future health and success of the enter-
prise the center of attention
Avoid potential de-railers: Failure to
manage your bio-reactive behaviors;
failure to build mutual relationships
with others; and making you the center
of attention. LE
Judith E. Glaser is CEO of Benchmark Communications, Inc.
and author of Creating WE (Platinum Press, 2005), selected
as one of the best business books of 2005 and The DNA of
Leadership. www.creatingwe.com, 212-307-4386
ACTION: Assess your use of power.
L e a d e r s h i p E x c e l l e n c e
 Competence Learning
learning to keep them thinking and
acting ahead of the competition. They

Learning Organizations create new markets, new market

approaches, new products, and greater
customer value constantly. They never
W h a t d o t h e y r e a l l y d o ? squander their market advantage by
letting their competition think or act
ahead of them.
by Warren Wilhelm • General Electric. Their Crotonville
learning center drives continuous How Do We Do It?
learning by managers and other lead- So, if we want to create a true learn-

F OR YEARS WE’VE BEEN ers, as they return to learn and teach at

using the term
“learning organiza-
transitions in their careers.
• Goldman Sachs. Their Pine Street
ing organization, how to do it? First,
the CEO or senior leaders must
believe in the value of continuous
tion,” without being sure exactly what learning center provides essential learning. They must clearly communi-
it means or how to create one. learning to a large segment of their cate the value the organization places
Learning organizations, and the managerial population. in learning by words and by actions.
people in them, learn constantly from • Pizza Hut. They constantly invent Senior leaders need to show how
everything they do. They use their and implement new technology; and they continuously learn: personally
own experience and that of others to recognizing the lifetime value of their conduct after-action reviews, review
improve their performance. They customers, treat them as long-term assets. projects at key junctures, talk freely
learn from their successes, and fail- • Honeywell (AlliedSignal). As they about what they are learning from
ures. Continuous learning is systemi- apply Six-Sigma approaches, quality is outside, publicly question others
cally built into the DNA and constantly improved while costs are about what they are learning, work to
infrastructure. The value of continu- simultaneously decreased. eliminate any resistance to learning
ous learning is espoused, driven, and • Microsoft. They successfully made that may appear, and stay open to
role-modeled by the CEO and senior the massive shift in mindset from learning, even when business condi-
management. Every member knows tions make it difficult.
that continuous learning is expected Structural enablers should also exist:
and will be rewarded. • Create mechanisms for information
In a learning organization, commu- transmittal and diffusion, such as brief
nication is open and widespread; peo- reports, standup meetings, daily
ple at all levels are included in most emails, and town meetings.
communications because it’s assumed • Reward people for using these
that everyone “needs to know.” mechanisms; discipline people for not
Further, senior leaders show that they using them.
are learning constantly by communi- • Create central repositories of rele-
cating what they are learning as they vant knowledge.
learn. People are rewarded for learn- Some organizations have helped to
ing—with recognition, growth jobs, imbed these structural enablers by
promotions, and financial compensa- creating the position of Chief
tion. And, people who don’t learn are Knowledge Officer (CKO). It is the
managed out of the organization. role of this person to manage informa-
desktop to internet when their market- tion by overseeing the flow of infor-
Competitive Advantage place changed. mation coming in and assuring that it
To be a learning organization pro- • Johnson & Johnson. Driven by their is directed to where it will be most
vides competitive advantage. LOs are famous Credo, they constantly useful. We most often see this role in
superior competitors. They have improve their products and invent intellectual capital companies, like
superior brand equity. They attract new ones, always with the user at the consulting firms, whose basic prod-
and retain the best talent. center of their focus. ucts are essentially information.
With such advantages, many orga- • Apple Computer. They perceive A CKO is different from a CLO.
nizations strive to be LOs. However, unrecognized marketplace needs and The CKO assures the collection and
becoming and sustaining a LO create new products to fill them. dissemination of information, while a
requires a lot of work, dedication, • Toyota Motor. They use Lean CLO is responsible for members’ learn-
time, energy, and resources. Many are Manufacturing and Continuous ing what is most useful to them at any
thwarted in their attempts by the Improvement to make small but given time. Both roles can be critical to
press of daily work, inability to perse- never-ending improvements in prod- maintaining a LO:
vere, lack of support from the top, or ucts and processes. The most successful LOs perpetuate
lack of commitment to the idea. • USA Today. They invented and keep their advantage by:
Yet, despite these obstacles, we can reinventing publishing technology to • Encouraging people to collect infor-
cite many examples of companies that move information colorfully and elec- mation across all boundaries
have been true LOs for years, if not tronically, and to manage distribution. • Being sure that information is
decades. Their long-term success is What’s common to these companies shared, not forgotten or hoarded
testimony to the value of continuous is their founding on basic principles • Encouraging casual information
learning. Examples include: and values, and their continuous sharing as a way of organizational life.
L e a d e r s h i p E x c e l l e n c e 17
 Advances in electronic media over
the past decade or so have made this
much easier.
In the best learning organizations,
all members are constantly involved in
feedback loops. This means that they
seek feedback from their colleagues on
ideas they have or actions they’ve
taken. They routinely give feedback to
others; and also give “feedforward”
ideas and suggestions to their associ-
ates on a regular basis. This dynamic
activity assures that everyone is learn-
ing from everyone else all the time.
Once a true learning organization
has been created, continuous learning
must become a way of life. It is baked
into the culture. Once started, learning
must not be allowed to slow down or
stop. Examples of other learning orga-
nizations that have mastered continu-
ous learning and product adaptation
include Southwest Airlines, Intel,
Cisco Systems, Wal-Mart, Charles
Schwab, Disney, and Dell Computer.
All of these companies were built
on unique premises, and have flour-
ished because they never stopped
learning and moving forward into
new frontiers related to their core
premise. Other companies have not
fared so well, largely because they
stopped learning at some point: the
American railroads (AmTrak), follow-
ers in the oil industry (Gulf, Amoco),
Greyhound Bus Company, followers
in the computer industry (RCA, GE,
Compaq), the Great Atlantic and
Pacific Tea Company (A&P),
Woolworth, Kmart, and some depart-
ment stores. Sadly, American auto
makers have not appeared to learn
from changes in their marketplace, or
from the success of their non-
American competitors. This lack of
learning may prove fatal, unless they
can “learn to learn” more efficiently in
the future. Their plight provides us all
with a model of why continuous
learning is so critical, and what can
happen if learning is ignored or not
pursued vigorously enough.
For all organizations, at some point,
survival may depend upon becoming
a learning organization! Efforts to
move in that direction are never wast-
ed, and in fact may help to guarantee
the survival of ideas, products, and
jobs for their members. LE
Warren Wilhelm, former CLO for Amoco and AlliedSignal,
conducts research on leadership, consults, and teaches at
Thunderbird, the Garvin School of International Management,
and SMU. He is the author of Learning Architectures:
Building Organizational and Individual Learning.
Warren@WilhelmConsulting.com
ACTION: Plan how you can become a LO.
18
Performance Growth
Small Giants
Be great instead of big.
by Bo Burlingham
S O O N E R O R L AT E R ,
every business
leader must make an
important choice that has to do with
how far and how fast you want the
company to grow. No one will warn
you about it, or prepare you for it.
Your banker, lawyer investor, or
accountant will likely encourage you
to grow as fast and as far as you can,
and others will send similar signals.
If you constantly hear about the
need to grow or die, if every other
company seems to be trying to get to
the next level, if the only companies
being celebrated, or even
taken seriously, are the
biggest or the fastest-grow-
ing, you may never even
think about other options.
You do have a choice,
however, and the payoff for
choosing the less-traveled
path can be huge. It can
affect every aspect of your
business—from your rela-
tionships with the people
you work with, to the con-
trol you have over your time and your
future, to the impact you have on the
world around you, to the satisfaction
and fulfillment you receive from your
work. For proof, look at the companies
that I call Small Giants.
Small Giants don’t fit comfortably
into any of three normal categories:
big, getting big, and small. Some are
tiny; others are quite large. Most are
growing, often in unconventional ways,
but several have chosen not to grow at
all, and a few have scaled back.
Small Giants strive to be the best at
what they do. Most have been recog-
nized for excellence. They have all had
the chance to raise a lot of capital,
grow fast, do mergers and acquisitions,
expand geographically, and follow the
well-worn route of other companies.
Yet they choose not to focus on rev-
enue growth or geographical expan-
sion, pursuing instead other goals.
They usually remain privately owned
and closely held or employee-owned.
These companies share a certain
quality. You can sense it as you walk
around their facilities, see it on the
bulletin boards and in the faces of the
people, hear it in their voices, and feel
it in the way they interact with one
another, with customers, and with
strangers. They have a buzz, a sense of
excitement, anticipation, movement,
purpose, direction, of going some-
where. They find themselves in sync
with their market and with each other.
Everything just seems to click.
But what is that elusive quality? Let’s
call it mojo or charisma. When leaders
have charisma, people want to follow
them. When a company has charisma,
people want to associate with it.
Five Leadership Factors
Where does their mojo come from?
The major factor is the influence of the
leaders in five areas:
1. They have clear ideas about why
they are in business and what they want
out of it. Clarity allows them to resist
the pressures put on companies to grow
in ways that their leaders
may not want.
2. They are passionate
about what their compa-
nies does. Their passion is
the driving force behind
the company’s commit-
ment to being the best.
3. They build close ties
with the communities
where they do business—
and not just by “giving
back.” They hire locally, get
involved with local schools, support
other local businesses, serve on local
boards, give to local charities, con-
tribute to the community’s well-being
and reflect its character.
4. They develop intimate relation-
ships between their companies and
their employees, customers, and suppli-
ers. People are treated with respect,
dignity, integrity, fairness, kindness,
and generosity. Relationships with cus-
tomers and suppliers are built around
personal, one-on-one connections.
5. They keep their companies pri-
vate and closely held. They know that
they will be free to pursue their goals
only if they aren’t beholden to outside
shareholders, and so they don’t take
their money.
Small Giants’ leaders set high stan-
dards for themselves and companies.LE
Bo Burlingham is an editor-at-large of Inc. magazine and the
author of Small Giants: Companies That Choose To Be
Great Instead of Big (Portfolio). www.smallgiantsbook.com,
boburlingham@aol.com
ACTION: Consider being a small giant.
L e a d e r s h i p E x c e l l e n c e
 Competence Intelligence
people, groups, and cultures accurate-
ly. They inspire through passion, com-

Inspiring Others mitment, and concern for people and

Practice resonant leadership.
by Richard Boyatzis and Annie McKee
Sustaining Resonant Leadership
The men and women we call reso-
nant leaders are stepping up, charting
paths through unfamiliar territory, and results. They know the market, technol-
the vision. They cause those around
them to want to move, in concert,
toward an exciting future. They give
us courage and hope, and help us to
become the best that we can be.
Resonant leaders blend financial,
human, intellectual, environmental,
and social capital into a potent recipe
for effective performance. In addition
to being great to work with, they get

F OR THOSE BOLD ENOUGH TO LEAD , inspiring their people. They are find-
the challenges are immense.
Globally, leaders are up against an
ing new opportunities, creating hope
in the face of fear and despair. These
ogy, people, and organization. Reso-
nance enables them to use this expertise
in pursuit of performance and engage
unstable world with social systems leaders are moving people—powerfully, the power of all who work there.
that no longer meet the needs of fami- passionately, and purposefully. And Even good leaders are finding it
lies, communities, or nations. The they do so while managing the very difficult to sustain their effective-
changes baffle our sense of reason and inevitable sacrifices inherent in their ness—and resonance—over time. Why?
ignite panic, anger, as well as impul- roles. They give of themselves, in the They give of themselves constantly.
sive, ineffective responses. Global con- service of the cause, while also caring When leaders sacrifice too much for
flicts now touch us personally. for themselves, engaging in renewal, to too long—and reap too little—they
Let’s look at one leader who con- ensure they can sustain resonance over can become trapped in the Sacrifice
sistently meets today’s challenges. time. They are inspiring their people to Syndrome. Leadership is exciting, but
Whether cheering his basketball team reach for “impossible” dreams. stressful. It is the science of power and
or walking in the Student Union, Scott influence—and power creates distance
Cowen exudes enthusiasm. His path between people. Leadership is lonely.
to being the inspirational President of Leaders are often cut off from support
Tulane University was the football and relationships with people.
field, covert operations as a U.S. Army Our bodies are not well equipped
Ranger, a doctorate, and then, becom- to deal with this “power stress.” Over
ing a professor and Dean at Case time, we become exhausted—we burn
Western Reserve University. There out or burn up. The constant small
Scott revealed a talent for motivating crises, heavy responsibilities, and the
leaders to emerge from the ranks of perpetual need to influence people can
research professors at the Weatherhead be such a heavy burden that we find
School of Management. He spent ourselves trapped in the Sacrifice
hours talking to executives about their Syndrome and slip into internal dis-
future challenges. Then, he searched quiet, unrest, and dis-stress. When dis-
for people studying topics that held sonance takes over, we suffer
promise for these coming needs. physically and emotionally, and our
Once found, he enticed these far- Resonant leaders are in tune with cognitive functioning is impaired.
sighted individuals to join the faculty those around them. This results in Dissonance becomes the default, and
by talking about possible research dis- people working in sync with each oth- spreads quickly to those around us.
coveries and programs. And he ers’ thoughts (what to do) and emo- To counter the Sacrifice Syndrome,
encouraged existing faculty to create tions (why to do it). Leaders who can leaders need to focus on renewal:
concepts for research centers and create resonance are people who have attending to themselves and others by
development programs. He listened developed emotional intelligence—the cultivating experiences that energize
for insight, fed excitement about inno- competencies of self-awareness, self- and reinvigorate. Three paths help
vations, and asked people to develop management, social awareness, and leaders to create resonance and to
the concepts with colleagues in circles relationship management. They act restore and renew themselves—and oth-
of dialogue. While Scott guided them with mental clarity, not simply follow- ers—mindfulness, hope and compassion.
through the minefields of academic ing a whim or an impulse. They reverse the negative effects of
politics, they took the visible lead. Emotionally intelligent leaders power stress. By attending to oneself,
In eight years, Scott inspired more build strong, trusting relationships. encouraging an optimistic vision of
than 15 faculty members to become They know that their emotions are the future, and caring for others, lead-
leaders of programs that created new contagious, and drive their people’s ers can ignite resonance in themselves
markets for the school, like the moods and performance. They know and those around them. LE
Executive Doctorate in management. that while fear and anger may mobi-
Richard E. Boyatzis, Ph.D. is Professor of OB and Psychology,
Scott’s excellent leadership contin- lize people in the short term, these Weatherhead School of Management, Case Western Reserve Uni-
ues. He got everyone out of Tulane emotions backfire quickly, leaving versity, and coauthor with Annie McKee of Resonant Leader-
ship (HBS Press). 216-368-2053, richard.boyatzis@case.edu
and moved to safety at least 12 hours people distracted, anxious, and inef-
before Hurricane Katrina struck. fective. They have empathy. They read ACTION: Become a resonant leader.
L e a d e r s h i p E x c e l l e n c e 19
Leadership Followers
Measure of a Leader
What followers say about effectiveness.
by Aubrey Daniels and James Daniels
W E PROPOSE A NEW MODEL
to identify and train effective
leaders. We look at the followers to
determine the quality of leadership.
We are not examining leadership in
terms of a person’s position. We exam-
ine the effect that any one person has on
the behavior of others.
You are a leader only if you have
followers. Thus, the focus of any
study of leadership should be on the
relationship between the leader and
the followers. Follower behavior, not
leader behavior, defines leadership.
Four criteria of the followers’
behavior define leadership:
1. Followers deliver discretionary
behavior directed toward the leader’s
goals. Followers make sacrifices for the
leader’s cause. The most effective lead-
ers get more out of their followers than
they are required to give. In essence,
individuals donate some of their time
and energy to the leader’s cause.
2. Followers make sacrifices to
advance the leader’s cause. This implies
a commitment to the leader and his
cause and is an example of a volun-
tary choice rather than a forced one.
3. Followers reinforce or correct
others so that they also conform to the
leader’s teachings and example. This
criterion talks about the relationship
the followers have with each other as
a result of the leader’s example. They
agree that the leader and his objec-
tives are worthy enough that they will
be supportive of one another.
4. Followers set guidelines for their
own personal behavior based on their
perceived estimate of that which the
leader would approve or disapprove.
The follower and the leader respect
each other for what each contributes
to the cause.
Much of leadership is to be found
in the context. Would Churchill have
been considered a great leader with-
out World War II? Probably not. Yet
Churchill did not change his personal-
ity so much as did the situation.
20
Three Factors
In a historical sense, we judge the
greatness of a leader by three factors:
1. Magnitude of their impact.
Leaders are judged by the vigor and
growth of their message and by the
pervasive influence of that message.
When others base their life decisions on
the example or teachings of a leader,
one condition of greatness is met.
2. Duration of their impact. Great
leaders produce disciples who extend
their message and example beyond
their immediate role. How long the
leader remains an influence to others
is part of the leader’s legacy. Some
leaders may be judged as great by their
contemporaries but leaders’ legacies
depend on how people in the future
recount their stories.
3. Number of followers. The number
of followers is also significant. Fame
and notoriety are indicators of the
numbers of people impacted by the
words or example of a leader.
Greatness as a leader assumes effec-
tiveness. Since greatness is such a frag-
ile designation, we talk about effective
leaders. While we may refer to people
that history has denoted as great lead-
ers, we focus on those who lead others
in any venture or cause, regardless of
its magnitude, duration, or impact.
We caution you not to value leader-
ship over management. Both roles are
equally valuable. The durability of the
leader’s vision depends on the quality
of management. In fact, one role of a
leader is to ensure the quality of man-
agement—that there are systems and
processes in place that will outlive per-
sonalities and ensure the leader’s legacy.
In effective organizations leadership
and management are complementary.
Both functions must be fulfilled. The
better you see the differences, the more
effective you can be in both roles.
One challenge for managers is
learning how to be leaders. Many mis-
take the form for the essence. It is
normal for managers to look to promi-
nent, successful leaders as their mod-
els. Too often, however, they copy the
behavior that is an impediment to
their model’s success rather than a
cause. They are seduced by what they
see and usually what they see is only a
small sample of the leader’s behavior.
Just as looking to the North Star
permits the Captain to guide his ship,
looking at the behavior of followers
permits leaders to develop their skills.
Traditionally leaders are measured
by their impact in three dimensions:
Did they grow the enterprise? Did the
enterprise achieve prominence? Did
the leader leave a positive legacy?
One’s accomplishments, however,
can slip away at any time, or they can be
cancelled by some significant failure.
The only disadvantage of measures
that are based on long-term results is
that they give little guidance to anyone
seeking to grow leadership skills. Real-
time measures are more meaningful.
Measurement in leadership serves
its greatest function when it is used to
establish causal relationships between
leader behavior and follower behavior.
Measurement should help the leader
answer the questions, “What must I do
to cause this number to change?” This
assumes that you can count some-
thing, since a judgment does not offer
you the same benefit. Judgments are
indirect measures and subject to inter-
pretation. Actual counts are preferred.
When we measure leadership, we
use numbers that pertain to follower
behavior. Our questions then become:
“How do I get more people to do X?”
The best predictors of leadership
are to be found in the behavior of the
leader’s followers: How do the follow-
ers respond to the leader’s direction?
How focused are the followers on the
leader’s goals? How do the followers
relate to each other? How do the fol-
lowers react to the leader himself?
These indicators provide the best
forecast of the leader’s impact. LE
Aubrey Daniels, Ph.D. and James Daniels are the authors of
Measure of a Leader (Performance Management
Publications). 678-904-6140, www.aubreydaniels.com
ACTION: Measure your effectiveness.
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