The secret science of brilliant leadership

05 February 2014

www.pwc.ie/hrs

PwC

Dr. Alan Watkins

Complete Coherence

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Volatile.Uncertain.Complex.Ambigious.

The Challenge of the Future

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Vertical Development Increasing sophistication of thinking &

ability to handle complexity

Horizontal Learning Acquisition of skills, knowledge &

experience

‘Vertical’ development

‘Horizontal’ development

“Imagination is more important than knowledge” Albert Einstein 1929

Upgrading the Human Operating System

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Assessing Leaders

It is possible to assess people in hundreds of different ways. One way is to describe distinct “types” of individuals. An example of a simple typology would be whether someone is male or female. In business one of the most widely used typologies is Myers Briggs. Although typologies can provide useful information their primary limitation is that they rarely have developmental implications. Thus it is difficult to change your type. You can’t develop from an “INTJ” into an “ENFP”.

Other assessment instruments cherry pick a handful of individual qualities and then try to make the case for these qualities being more important than the qualities chosen by another assessment instrument. We take a slightly more structured approach. Firstly all of our assessments are all based on extensive research. Secondly they must produce information that can be used to help the individual actually develop. Thirdly we have designed a suite of instruments that look at the five main lines of human development and assess each one separately. This avoids mixing up different developmental lines. The Leadership Values Profile™ (LVP) specifically focuses on the “values” line of development (see next slide).

Assessment of different lines of development uncover different leadership assets & capabilities:

1. Physical: this quantifies a leader’s physical energy, vitality, health risk, immunity, flexibility, coherence and a number of other specific physiological patterns. 2. Cognitive: this assesses a number of aspects of a leader’s thinking capability such as reasoning skills, problem solving ability and perspective taking. 3. Emotion: this quantifies a leader’s emotional and social intelligence including their self awareness, ability to change emotional states and their empathic skills. 4. Values: this explores a leader’s commercial and personal value systems. It also identifies the type of people a leader tends to engage with and who they move away from. 5. Maturity: This assess a leader’s ego maturity, which underpins their ability to drive organisational transformation and handle complexity.

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cognitiv

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behavio

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Key Lines of Development

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Academic Research on Values & Culture

Geert Hofstede

Schalom H Scwartz

Clare Graves

Culture & Values

Despite many organizations recognising the importance of culture and values the complexity of the issue means that most businesses struggle to effect a positive cultural transformation within their workforce. This struggle is not helped by a lack of definition or inability to discriminate the key concepts such as: culture, values, beliefs, attitudes, behaviour, climate, personality, identity and reputation.

A value system is a cluster of related ideas that when taken together create meaning or importance for a person (value). The values in an organisation are the emotional qualities that can usually be sensed if you walk the floor, or talk to staff. In contrast, beliefs are normally only uncovered by asking questions about what people think is true. The informative research on culture and value systems that has been done comes from a number of different academic centres. The main leaders of these research efforts were Schwartz, Hofstede and Graves. Interestingly there is a very significant overlap in their findings.

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Spiral Dynamics- Rules to Remember

The LVP draws on all of this research but leans most heavily on the work of Professor Clare Graves as his model, often referred to as “Spiral Dynamics”, has the added benefit of having evolutionary implications and being better placed to drive development. Graves’ model was based on empirical observational research conducted over 30 years. He identified eight separate value systems. Each value system emerges from the previous level in an ever expanding spiral.

It is important to remember that individuals and cultures are not exclusively defined by any single level (colour). Each person and culture embodies a mixture of value patterns, with varying degrees of intensity. Also the value system an individual operates from at work may not be the same value system they operate from at home. The degree of difference between an individual’s profile at work and at home can itself be quite informative.

Rules to Remember about the Spiral:

1. Higher up the spiral is more sophisticated but not “better” 2. Each new level includes and transcends the previous level 3. The pendulum swings from the individual to the collective focus 4. Your LVP is situational and evolves over time if things change 5. Every level has an upside and a downside 6. It is the downside of one level that provides the evolutionary

momentum for the emergence of the next level 7. Globally 98% of people exist at the lower six levels (Tier 1) with

2% in the upper 2 levels (Tier 2). In business the percentage of people in Tier 2 is nearer 10%

8. The model holds true regardless of scale: a. Individual b. Team c. Business unit d. Company e. Nation f. Region g. Planet

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Commercial Applications of the LVP

Benefits of Measuring Leadership Values

Measuring a leader’s value system can benefit an organisation in a number of ways. It helps:

1. Identify the commercial & personal value system that drives each leader forward

2. Provide insights on a leader’s strengths, blind spots and motivations

3. Rapidly build a language for understanding how to get the best out of a team

4. Align stakeholders on the key commercial priorities to ensure synergies are optimised

5. Create a cultural shift within the business built around an advanced performance mindset

6. Bring the brand values alive within the business in a much more tangible way

7. Clarify whether a leader’s values suit the team & business challenge that they face

Personal Leadership

Alignment & Engagement

Talent Asses. & Recruitment

Cultural Transformation

M&A Diligence & Integration

Team Dynamics

Levels of Spiral Dynamics

get through

stay alive

what’s in it for me

I have what I need

survive

beige

survival

no progress

Survival

The Beige value system is not assessed in the LVP as it is assumed that the vast majority of people in organizations have evolved beyond this level. Who Are They? This value system may still be apparent in certain populations within an industrialized society. For example, it may be present amongst the homeless, the unemployed, the sick or the marginalized. In times of economic hardship it may be possible to witness some very basic beige behaviour within organizations as simple survival motives kick in. This may be the case in situations of bankruptcy or potential redundancy.

Get Through

Stay Alive

What’s In It For Me

I Have What I Need

Survive

Common Thoughts

Commercial Drives What drives people with this value system are their immediate basic needs. They are highly attuned to their physical senses which are often heightened. Satisfaction of basic biological needs tends to stop action and provoke rest until these needs must be addressed again. As such people at this level tend not to plan at all. They live from day to day. Development The best way to help Beige individuals is to bring them together with others Beige individuals so they can start to bond and realize they are not alone. Communication To reach them you often have to directly encounter them. They may not engage with modern communication channels or if they do this is in a haphazard way. You must address their short-term needs first.

Individual Focus

don’t risk it

stay vigilant

work together

look after the family

stay together

purple

safety and belonging

no direction

The Purple value system is seen in many organizations either in the early stages of an company’s evolution; during mergers and acquisitions; in specific functions or in geographically separate offices. Who Are They? They are small teams for whom their tribe is their main point of connection. They can feel somewhat separate from the corporate machine or mission. The sense of bonding with their colleagues keeps them from leaving and they can often be mildly hostile to the company itself. Their analysis of the situation is not sophisticated and they can easily fall into the victim mode and believe that the business is not working in their interests.

Commercial Drives They are driven by having a safe place to work where no-one rocks the boat too much or creates too much change. They are very quick to sense a personal or commercial threat and they can react strongly to protect their own position and the security of their tribe.

Development The best way to help Purple individuals move forward is to identify the natural red leaders who are trusted by the tribe, promote them and allow them to lead the rest of their colleagues.

Communication They must be reassured that change will not threaten the tribe. In fact change must be sold as a way of protecting the tribe. They will engage as a group and can be inspired by a charismatic presentation. It is vital to allow time for the tribe to debate the suggested change and reach a collective agreement.

Don’t Risk It

Stay Vigilant

Work Together

Look After the Family

Stay Together

Common Thoughts

Belonging Collective Focus

go for it

keep moving

work hard, play hard

have fun

take charge

red

make it happen

ego mania

The Red value system is the second most common perspective in business and many companies have unconsciously chosen red as their corporate colour. It is particularly prevalent in the early stages of a company’s evolution or in divisions that are opening up new territories. Certain functions, such as sales, are often red.

Who Are They? Many CEOs and leaders drive their business forward from this perspective. They are often charismatic individuals who lead by dint of their authority. They tend to operate a “hub & spoke” command and control model of leadership. They are good at taking charge and great at simplifying and clarifying the priorities.

Commercial Drives They always want to be number 1 in their markets. They are restless, relentless and resilient with a strong sense of urgency. They move fast to get control and dominate by dint of their status or power. They are good in a fight, an emergency or in a turnaround where they can be the hero in the hunt for glory.

Development The best way to help Red individuals is to show them how, with a little more structure, they can celebrate an even greater victory. The knack is to help them work smarter not harder, a little more skill and a little less speed is often what’s required.

Communication It must be made very clear to red individuals how they can personally contribute. The battle must remain exciting or fun if their interest is to be maintained. They prefer short to the point communications – “keep it simple stupid” is a mantra of theirs.

Common Thoughts

Go For It

Keep Moving

Work Hard Play Hard

Have Fun

Take Charge

Power Individual Focus

plan it carefully

stick to the plan

be loyal and respectful

stick to your principles

do the right thing

blue

stability and order

rigidity and rules

Government departments, bureaucracies and public sector partnerships often have a blue culture. These are systems built on rules and order. All businesses must go through a blue phase to build a stable platform for growth. It is often insufficient discipline or sloppy methods that impair large companies from achieving their potential. Good organization and high quality processes can make a massive difference to most companies.

Who Are They? Blue CEOs and leaders are often values driven or financial value drivers building their company through M&A processes. Blue individuals are also more common in specialists functions such as finance, accounting or IT.

Commercial Drives Blue individuals want to do the right thing in the right way. They are comfortable following the rules of a higher authority, whether that be the company, their boss or God. They are accurate, crisp and want to deliver to a high quality standard. They consider the meaning of their work and have a desire to bring stability.

Development The best way to help Blue individuals out of their tendency to get stuck in the rules is to encourage them to experiment and show individuals how this could benefit them personally. This is an appeal to self-interest, which will succeed if it appears to be the right thing to do and does not contravene the individual’s sense of right and wrong.

Communication All communication must be neat, tidy and be well presented. Meetings must be well structured, stick to time and follow a disciplined process. Blue people tend to be diplomatic, avoid conflict, and are efficient completer finishers who like to take the moral high ground.

Plan It Carefully

Stick to the Plan

Be Loyal & Respectful

Stick to Your Principles

Do the Right Thing

Common Thoughts

Order Collective Focus

orange

make it work

adapt based on feedback

achieve the targets

figure it out

succeed

growth and wealth

greed and exploitation

Most businesses operate from an orange value system. In fact orange is over represented in corporate livery. Building on a “blue” infrastructure orange focuses on doing what it takes to beat the competition, succeed and deliver profits.

Who Are They? Most CEOs are professional managers. They may also be commercial executors or the corporate entrepreneurs. All operate from the orange value system and focus on delivering short-term business performance while leveraging the resources available to them. They take a pragmatic no nonsense view of the world and they are happy to do what it takes to achieve the targets they set for themselves.

Commercial Drives Orange individuals want to make money and win. They are very competitive on many fronts. They have a slightly more mature ambition compared to red individuals and are more able to take advantage of other people’s abilities to achieve their own goals. They are very rational and like to understand how things work so they can make the “machinery” of business deliver its profits.

Common Thoughts

Make It Work

Adapt Based on Feedback

Achieve the Targets

Figure it Out

Succeed

Wealth Individual Focus

Development To help Orange individuals out of their tendency to be too rational, too materialistic or too self interested it may benefit them to cultivate an ability for reflection. They may also find it useful to work on their emotional intelligence and ability to take people with them.

Communication All communication must be outcome focused and make it clear how the plan will work to deliver the desired result. There also has to be an opportunity for the individuals to work the issue and make changes. They will also need to know how it works financially.

include others

take people with you

listen and be sensitive

take care

do it together

green

caring and people

stagnant and touchy

Green businesses often emerge as an antidote to orange excess. They are motivated by finding a more caring inclusive way of proceeding that benefits the many not just the few. Such businesses are rarely in the FTSE 100 although there are companies whose internal culture has a strong green orientation. The importance of the green perspective is increasing as a result of social networking.

Who Are They? Green CEOs and leaders are often ambassadorial in style. They are generally more emotionally intelligent and are driven by a desire to help. They attempt to embrace all views and avoid creating two tier systems or hierarchies. Green prefers a flat level playing field.

Commercial Drives Green leaders focus on taking people with them and will slow down to make sure no-one is left behind. They try to achieve win:win relationships and will often “go the extra mile” to make sure people are able to contribute. They are motivated by human contact and achieving results through the team. Being liked is often more important than competitive advantage.

Common Thoughts

Include Others

Take People With You

Listen & Be Sensitive

Take Care

Do It Together

Social Collective Focus

Development Paradoxically individuals who operate with this perspective can polarize people. They can slip into negative judgmentalism if their attempts to help or care are thwarted. They may need help to see more than their own perspective. They may also benefit from being more flexible and decisive if they truly want to create benefits for the many.

Communication All communication must be customer focused and sensitive to minorities. They respond well to sincerity and heartfelt expressed emotion moves them. They want to feel involved and will welcome the opportunity to participate and say their piece. They can react badly to assertive leaders with simple answers.

innovate the future

solve the issues

be flexible and spontaneous

first look to yourself

learn and take responsibility

yellow

innovation and responsibility

complex and conceptual

Yellow businesses are innovation engines coming up with smart solutions to complex problems. They succeed by changing the game, creating a paradigm shift or setting a new context. Yellow businesses are usually small or if large they are organized on a small scale. They are competitive because they are fast, flexible and able to “hack” around older less optimal structures.

Who Are They? Less than 2% of leaders are truly yellow innovators. This perspective is more common in Generation Y (high yellow with high red). The yellow mavericks in organizations do not follow a traditional career path. If it is not working they will often leave and try their hand elsewhere.

Commercial Drives Yellow leaders don’t wait to be asked, they take responsibility for the solution. They see multiple perspectives and can easily handle conflicts of interest. They are drawn to complex problems and see them as a challenge. They are excited by new ideas and want to have an impact beyond their company.

Development To help Yellow individuals achieve their impact it is often necessary to help them with the way that they language their

Common Thoughts

Innovate the Future

Solve the Issues Live

Be Flexible & Spontaneous

First Look to Yourself

Learn and Take Responsibility

Innovation Individual Focus

ideas. They can over complicate things or wrongly assume that people follow the sophistication of their thought processes. They can appear dispassionate and aloof and this may impair their ability to connect and land their views.

Communication To engage effectively with yellow individuals it is vital to lay out the conceptual frame for the conversation first. Then there has to be sufficient substance to the message otherwise yellow individuals will perceive it as light weight, not serious and not worthy of consideration.

consider everything

balance everything

take the long term view

take nothing personally

be of service for greater good

turquoise

system balance

cool and baffling

Turquoise organizations tend to be movements rather than formal businesses. Their focus tends to be evolutionary and long term. Such movements look for ways to create cultural and social change for the benefit of all people without falling into the trap of being too prescriptive or patronizing.

Who Are They? Turquoise CEOs and leaders are very rare, and when found they are normally at the helm of social or public enterprises. They can often appear distracted because they are computing very broad data sets. They can show up as many different colours, being very adaptive and situational in their leadership style. They can be strongly commercial or global missionaries and normally do not see their role as constrained by the businesses they may run.

Commercial Drives Turquoise leaders are not afraid to turn a profit if this helps the cause. They are also interested in being of service and living their life as an example. System harmony, increasing maturity and natural emergence all invigorate their actions. They are focused on leading beyond their authority and look for ways to be of service to everyone.

Development To help turquoise individuals succeed in the world it can help them to connect with the less sophisticated perspectives which they may have less familiarity with. They may also struggle with being fierce when they need to be. They often prefer to be tolerant, loving and allowing. They may suffer from excessive humility which can often be misperceived as a lack resolve.

Communication To engage turquoise individuals it often helps to state clearly whether there is a greater social or evolutionary intention.

Common Thoughts

Consider Everything

Balance Everything

Take the Long Term View

Take Nothing Personally

Be of Service for Greater Good

System Balance Collective Focus

PWC Event Table Data

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Table 1

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Table 4

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Table 2

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Table 3

Leadership Values Profile (LVP) – Tables 1-4

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Table 6

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Table 5

Leadership Values Profile (LVP) – Tables 5-8

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Additional Resources www.complete-coherence.com

Being Brilliant Every Day 6.5 hours of audio

Desktop App CardioSense Trainer

Coherence: The Secret Science of Brilliant Leadership

e-Development Academy Online leadership development

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