w w w . L e a d e r E x c e l . c o m Pat Lencioni Leadership Coach Excellence LEADERSHIP THE MAGAZINE OF LEADERSHIP DEVELOPMENT, MANAGERIAL EFFECTIVENESS, AND ORGANIZATIONAL PRODUCTIVITY OCTOBER 2007 Don’t You Be Seduced by Success Don’t You Be Seduced by Success Customer As Boss Customer As Boss Why Develop Your Leaders? Why Develop Your Leaders? You Can Have More Satisfaction You Can Have More Satisfaction “Leadership Excellence is an exceptional way to learn and then apply the best and latest ideas in the field of leadership.” —WARREN BENNIS, AUTHOR AND USC PROFESSOR OF MANAGEMENT
Transcript
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Pat LencioniLeadership Coach
ExcellenceL E A D E R S H I P
THE MAGAZINE OF LEADERSHIP DEVELOPMENT, MANAGERIAL EFFECTIVENESS, AND ORGANIZATIONAL PRODUCTIVITY
OCTOBER 2007
Don’t You Be
Seducedby Success
Don’t You Be
Seducedby Success
CustomerAs Boss
CustomerAs Boss
Why DevelopYour Leaders?
Why DevelopYour Leaders?
You Can Have More
SatisfactionYou Can Have More
Satisfaction
“Leadership Excellence is an exceptionalway to learn and then apply the best and latest ideas in the field of leadership.”
—WARREN BENNIS, AUTHOR ANDUSC PROFESSOR OF MANAGEMENT
ExcellenceL E A D E R S H I P
THE MAGAZINE OF LEADERSHIP DEVELOPMENT, MANAGERIAL EFFECTIVENESS, AND ORGANIZATIONAL PRODUCTIVITY
HOWARD GARDNER
Good WorkInternalize the need to act responsibly. . . . . . . .3
19. Ritz-Carlton Hotels20. Dow Leadership Institute21. JetBlue Airways22. McDonald’s23. Disney Institute24. Best Buy 25. Home Depot
Education/universities/schools ofmanagement and business
1. Univ. of Michigan/Ross2. Center for Public Leadership,
JFK School of Government, Harvard 3. Univ. of Chicago/GSB/Leadership4. UCLA/Anderson5. USC/Marshall/CEO6. Northwestern/Kellogg7. Pennsylvania/Wharton8. MIT/Sloan9. Harvard Business/True North
10. Duke/Fuqua11. Ball State Univ./Ed. Leadership12. Emory Univ.13. Utah Valley Univ./CAL14. Vanderbilt/Org. LD15. Univ. of Minnesota/ Carlson 16. Bellevue Univ.17. Yale Leadership Institute18. Stanford/GSB Leadership19. BYU/Marriott/Leadership20. Pepperdine/Graziadio/SBM21. Carnegie Mellon/Tepper/Leadership
Government/military1. Defense Acquisition University2. U.S. Air Force Academy3. FBI Academy4. U.S. Navy Naval Academy5. U.S. Marine Academy6. U.S. Army/Westpoint7. U.S. Army Rangers8. ASQ Baldrige Award9. Coast Guard
10. U.S. National Guard11. National Defense University12. U.S. Tactical/Seals13. Naval Undersea Warfare Center14. FAA
Consultants/trainers/coaches1. Zenger/Folkman2. Goldsmith/Katzenbach Partners3. Marcus Buckingham Company4. Jim Collins5. Human Performance Institute6. Leadersource7. Lebow Company8. The Leader’s Toolbox9. Tom Peters Company
Large consulting groups1. Linkage/GILD2. Results-Based Leadership3. Center for Creative Leadership4. HSM/World Business Forum 5. Senn-Delaney Leadership6. McKinsey/Leadership7. Vital Smarts8. Accenture9. Lee Hecht Harrison
10. DDI11. Adizes Institute12. Richard Chang Assoc.13. Dialogos14. Pacific Institute15. Booz Allen Hamilton16. Hewitt/Leadership17. BlessingWhite18. Franklin-Covey19. Crowe Chizek & Co.20. Ken Blanchard Companies21. Forum Leadership Development22. Personnel Decisions Intl. (PDI)23. Achieve Global24. Lore International Institute25. Eagles Flight
Please visit wwwwww..LLeeaaddeerrEExxcceell..ccoommfor more on Best Leadership Develop-ment Programs, Principles, Practices,and Presenters. LE
FOR 24 YEARS, WE’VE BEENdedicated to leadership
development (LD).This year we connected
with over 1,000 organizations to determinethe best LD programs and practices based onseven criteria: 1. Vision/mission. Are thesestatements linked to strategy, meaningful toparticipants, and focused on target outcomes?2. Involvement and participation. Howbroad is the involvement and how deep theparticipation? 3. Measurement and account-ability. What ROI measures are made andreported and to what degree is accountabili-ty for performance and results part of theprogram? 4. Design, content, and curricu-lum. How well designed is the program?How credible is the content? How relevantis the curriculum? How customized is theprogram? 5. Presenters, presentations, anddelivery. What are the qualifications of the
presenters, how effective are their presenta-tions, and how is the program delivered? 6.Take-home value. What do participants takeaway and apply to improve themselves,their families, their teams, and their volun-teer work? 7. Outreach. What is the impactof the program on stakeholders?
Before listing this year’s winners, I con-fess a few biases and beliefs: Many people inthis field don’t belong (they know next tonothing about authentic leadership).Everything (and the kitchen sink) is nowpackaged under LD (to make it easier to sellinternally?). Everybody (and their dog) isnow ranking top LD programs (usually as amarketing ploy). Management is gettingshort shrift. “Legacy” presenters and theircompanies are slipping. Great LD programsbenefit all stakeholders, cultivate loyalty andlongevity, and inspire service, even sacrifice.
We rated the best LD programs in sevencategories (my apologies in advance for alldeserving people and programs omitted):
H e r e a r e t h e t o p L D p r o g r a m s f o r 2 0 0 7 .
by Ken Shelton
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Best in Leadership Development
E . D . I . T . O . R ’ S N . O . T . E
2 L e a d e r s h i p E x c e l l e n c e
3. Work and responsibility. A notionthat marks the intersection of workand responsibility is that of vocation orcalling. These words imply that thework we carry out is work that wehave been “called” to execute carefullyand responsibly. When work is consid-ered “just a job,” the responsibility iscircumscribed—we carry out the letterof our job description—nothing more.We get paid for what we do, as long aswe do it. And when a better opportu-nity arises, or when our organizationdecides that our services are no longerneeded, we move on. Today, life cen-ters around work we want to do, liketo do, and feel needs to be done well.Our work needs to be “good.”
4. Good work. Good work is of excel-lent technical quality, ethically pur-sued, socially responsible,engaging, and enjoyable. Ofcourse, such work is noteasily achieved. Not allwork is executed at a levelof excellence, carried outethically, and engages thepassions of the worker. Still,we strive to become goodworkers and to encouragegood work. A naggingquestion arises: how do wediscourage or prevent work that doesnot meet these criteria of good work?Who is responsible for good work?
TThhee GGoooodd WWoorrkk MMooddeellGood work entails four elements:1. The individual worker. Relevant
here are the worker’s belief systems,motivation for doing good work, andpersonality, temperament, and charac-ter. These determine whether the per-son will hold to high standards or cutcorners, “go along,” or engage in com-promised or irresponsible work.
2. The domain of work. All profes-sions and most other lines of workhave a set of core values and beliefsthat are known to workers and carry acertain degree of force. For example,for more than 2,000 years physicianshave tried to adhere to the core com-mitments of the Hippocratic Oath.
3. The field forces that operate onthe domain. Mediating the core valuesare social entities: gatekeepers whodetermine entry, individuals who pro-vide or deny opportunities or prizes,and evaluators who assess the merit ofthe work. Think of the field as theindividuals and institutions that holdpower and make decisions. The sumof the domains (all professions, arts,crafts, and disciplines) constitutes the
Good Work
MOST OF US THINK INterms of our
rights of life, liberty,and the pursuit of happiness and acomfortable life. Yet, we all have cer-tain responsibilities. We’re expected toassume responsibility for our healthand welfare; for those who depend onus—spouses, offspring, and as theyage, grandparents and parents; forthose at our workplace, profession,neighborhood, community, and soci-ety. No wonder we are more comfort-able with rights: the areas for whichwe could assume responsibilitythreaten to overwhelm us.
Most of us spend at least half ofour waking hours at work. For manyof us, work entails burdens; for a for-tunate few, work is a privilege, gar-landed with rewards. This is especiallytrue for professionals—individualswho are accorded status, prestige, anda comfortable livelihood, in return forwhich we are expected to offer high-level services and clear-minded judg-ment. Today, issues of responsibilityhave taken on new urgency. Acrossthe professions, examples abound ofwork that is clearly irresponsible.
FFoouurr KKeeyy CCoonncceeppttssI comment on four key concepts:1. Work. For most of history, we’ve
worked long hours so that we couldeat, have shelter, survive, be secure,and protect our families. Most labor-ers have little time for leisure. Todaywe see an increasing division of laborand hierarchization and specializationof work. Those in power have latitudein how they approach their work andallocate time. Those with special know-ledge form prestigious professions.
2. Responsibility. To have an openand fair society, we must be preparedto carry out crucial actions: we mustact toward others in the way in whichwe would want all others to behave,and avoid other actions—howevertempting. The classical view of poli-tics entails a commitment to act as aresponsible citizen, and the classicalview of a profession entails a commit-ment to act as a responsible worker.
culture; the sum of the field entitiesconstitutes the society.
4. The larger social reward system.Individuals, domains, and fields areembedded in the society and economy.This broader society embraces variousrewards and sanctions, and these exertinfluence over and above the signalsthat permeate a domain or profession.
Good work is most likely to emergewhen these four elements are aligned.This does not guarantee good work,but when workers’ beliefs and valuescoincide with those of the domain,field, and society, they are free to workin ways that make sense to them.
Each individual must decidewhether to behave in a professionalmanner. Many “professionals” aggran-dize themselves, cut corners, and ben-
efit parasitically fromcolleagues. And manyhumble tradesmen behavein ways that are highlyprofessional. In standardprofessions, explicitresponsibilities haveemerged; professionals areexpected to know theseand to act in accordancewith them. In less profes-sional work, the burden of
delineating these responsibilities fallsmore on the individual practitioner.
VVaalluueess,, EEtthhiiccss,, MMoorraalliittyyGood workers honor the core val-
ues of their profession rather than suc-cumb to pressures of their supervisorsor seductive lures of the marketplace.We withhold the epithet “good work-er” from those who use their positionsto enhance their pocketbook, achievecredit unfairly, or abuse others.
Not all ethical issues and judgmentsof quality are clear cut—some involveright versus right or shades of gray: Isit better for a physician to serve a largepopulation or initiate a concierge prac-tice, in which enrolled patients are wellserved but only those with the meansto pay for it are beneficiaries? Shouldthe lawyer give her all for a client, nomatter how nefarious the client, ordraw on a broader sense of justice?
Recognizing the complexity of ethicsis not the same as embracing relativism.That the answer is not always clear orthat judgments may be controversial isscarcely license for “anything goes.” Inmost cases, one path is superior toanother: Bribery may be part of doingbusiness somewhere, but few woulddefend a system of bribery as superiorto one that bans or punishes bribery.
by Howard Gardner
L e a d e r s h i p E x c e l l e n c e 3
ETHICS RESPONSIBILITY
I t ’ s y o u r r e s p o n s i b i l i t y .
In ethical work, workers have a setof values that draw on the enduringvalues of the domain. They operateaccording to those values, even whenthese clash with immediate self-inter-est. They recognize issues of moralcomplexity, wrestle with them, seekadvice and guidance, reflect on whatgoes right, and seek to right the course.They take the challenges of responsibil-ity seriously and seek to behave in asresponsible a way as possible.
Still, we regularly encounter exam-ples of irresponsibility. Clearly we findit too easy to shirk responsibility andbehave in ways that may be good forus, but not healthy for society. Mattersconspire to undermine responsibility.We are not born moral or ethical—these virtues need to be nurtured,often against the odds. Those whostart on the right track can deviate.Pressures and seductions are power-ful. The material rewards for irrespon-sibility sometimes dwarf the plauditsfor responsibility. Intrinsic motivationbecomes essential in a milieu whereambient signals diminish ethical sense.
The sense of responsibility of thosewho do an exemplary job extends toother individuals, to the core values oftheir domain, to the benefit of society.The decision to enter a caring profes-sion, go against the odds, persevere,and navigate uncharted domains char-acterize individuals who embraceresponsibility, sometimes to the point ofexhaustion, and model it for others.
Professionals are buffeted by pow-erful market forces. The crucial vari-able is the extent to which people inthat vocation take on the responsibili-ties they deem important, whether ornot support is available from others orfrom the values of the domain.
Here are six takeaways: 1) know themission of your occupation and yourrole in it; 2) relate your beliefs and goalsto your occupation and roles; 3) workwith individuals and institutions thattake responsibility seriously; 4) set pri-orities, be alert to limits and boundaries,and balance responsibilities; 5) broadenyour sphere of responsibility in yourprofession or community; and 6) sup-port youth, the future good workers.
Most people have not internalizedthe need to act responsibly. Leadersneed to portray what it means to beresponsible, to model responsibility,and to pass on a sense of responsibilityto future stewards of the workplace. LE
Howard Earl Gardner is the Hobbs Professor ofCognition and Education, Harvard GSE. Call 617-496-4929 or visit www.howardgardner.com.
ACTION: Take responsibility for good work.
by Robert Galford
legacies in personal terms: “I hope thatmy legacy at work will consist of thesame things for which my family willremember me, and be proud of.”
Focusing on legacy has a secondvaluable outcome: helping leadersleave positive legacies. Successful com-panies most always have strong lead-ers, but organizational success oftencomes at a personal price. We all canname people who built financially suc-cessful companies at the cost of per-sonal relationships or their ownsatisfaction. They excelled at driving acompany forward, yet left peers anddirect reports vowing: “I’m nevergoing to behave that way.” They leavenegative leadership legacies.
AAsskk TTwwoo QQuueessttiioonnssWhen considering your leadership
legacy, ask two questions:1. Who were the last 10 people to
unexpectedly come into your office,call, or email and what did they want?Did they seek advice? Did they wantyou to mediate a dispute or help thembrainstorm? A theme in your answersprovides a clue as to your tendencies
as a leader, and the legacyyou’re seeding.
2. What parts of yourjob you find most enjoy-able? Do you see overlapwith the needs people turnto you to fill? If so, there’sanother clue. What parts ofyour job do you enjoy theleast? Are these formalresponsibilities you take onbecause you feel you must?
These questions help you thinkabout where and why you might beleaving a negative legacy, and whereyou’re having a positive impact.
IInnfflluueennccee YYoouurr CCoouurrsseeYour legacy is today. Sure, over
time, you’ll be reviewed on several fac-tors, including revenue figures,growth, and profits. But your leader-ship legacy—the influence that youhave on the thoughts and actions ofthe people you lead—is being builtnow, and is already being reflected inthe faces of each person you contact.
By influencing your course, beingaware of strengths and weaknesses,and probing why certain aspects ofyour job are more or less desirable, youwill seed a positive leadership legacy. LE
Robert Galford is co-author of Your Leadership Legacy withRegina Fazio Maruca (HBS Press) and co-author of TheTrusted Leader. Visit www.yourleadershiplegacy.com.
ACTION: Seed a positive leadership legacy.
WHEN I SPOKE WITH MYcollege freshman
son about our book,Your Leadership Legacy, I said, “Thinkabout Enron. Ken Lay. Jeff Skilling.What might have been prevented ifthey’d thought more about what theywanted people to remember aboutthem? What if they had spent less timetrying to ‘goose’ the stock price andmore time doing their job in such away that people would respect them?”
My son casually replied, “So yourbook says two things: Think long term.Don’t be stupid.” Then he said, “Iguess no matter how big a deal youare, leaving a positive leadership lega-cy takes some work.”
Indeed. When we start out, we findthat success hinges on customer andclient relationships.Mastering our craft, doinggreat work for clients, andbecoming their trusted advi-sors lays the foundation forour roles as trusted leaders.
We usually consider theimpact of our leadershipwhen we’re about to retireor relocate. Looking back,we face unsettling “couldhaves” and “would haves.”
CCaattaallyysstt ffoorr AAccttiioonnYour leadership legacy should be a
catalyst for action, rather than an after-thought. If quarterly results are youronly benchmark, you might accom-plish small, discontinuous wins, andnever have the impact you could as aleader. Being intentional about yourdesired long-term impact helps youboth in the short and long run.
Thinking about your legacy is trig-gered naturally when a crisis occurs.The thinking that follows a crisis tendsto be driven by emotion, and, while itis powerful, the behavior changes itinspires are rarely sustainable. Engag-ing in legacy thinking fosters cleanerinsights and sustainable changes.
The more people reflect on theimpact of their leadership, the morethey emphasize the influence theyhave on the people they work with.They talk about their desired work
Positive InfluenceAdvisor to leader to legacy.
LEADERSHIP LEGACY
4 L e a d e r s h i p E x c e l l e n c e
when employees cannot see how theirjob makes a difference in the lives ofothers. Every employee needs to knowthat the work they do impacts some-one’s life—a customer, co-worker, orsupervisor—in some way.
3. Immeasurement. This refers to theinability of employees to assess theircontribution or success. Employeeswho have no means of measuring howwell they are doing on a given day orweek, must rely on the subjectiveopinions of others, usually their man-agers’ opinions, to gauge progress orcontribution.
Few managers take a genuine inter-est in their people, remind them of theimpact that their work has on others,and help them establish creative waysto measure and assess their perfor-mance.
WWhhyy MMaannaaggeerrss DDoonn’’tt CCaarreeThe primary driver of
job dissatisfaction is notpay or benefits, but the rela-tionship that an employeehas with his or her supervi-sor or direct manager. Evenpeople who are well paid,do interesting work andhave great autonomy don’tfeel fulfilled in a job if their managersaren’t providing them with what theyneed. Ask managers, “Why don’t youget to know your employees?” andyou’ll hear four reasons:
1. Busyness. Many managers thinkthey are too busy; of course, the realproblem is that these managers seethemselves primarily as individualcontributors who happen to havedirect reports—failing to realize thatthe most important part of their jobs isproviding their people with what theyneed to be productive and fulfilled intheir jobs. For them, any time takenaway from “real work” is a waste anda threat to progress. They have nosense of the impact that they can haveon an employee’s productivity andmorale.
2. Amnesia. These managers forgethow important it was to them when amanager took an interest in them,talked to them about why their workmattered, and gave them a means forevaluating progress. They forget whatit was like when they were junioremployees. They forget the impact thatmanagers have on an employee’ssense of self-esteem, enthusiasm, andjob fulfillment—just by taking an inter-est in their life.
3. Fear of being seen as touchy-feely.
Satisfaction
PEOPLE SPEND MUCHof their time at
work, and yet manyare unfulfilled, frustrated and miser-able in their jobs. A miserable job isnot the same as a bad one. A bad joblies in the eye of the beholder. Oneperson’s dream job might be anotherperson’s nightmare.
For some people, a “good” job isabout being paid well; for others, it’sabout the prestige of working for awell-known company; and for others, itmight be about not being behind a deskall day in an office. Having a “bad” jobcan mean that they are underpaid, domanual labor, or sit in an office withoutventilation or natural light.
SSiiggnnss ooff aa MMiisseerraabbllee JJoobbA miserable job is one that makes a
person cynical, frustrated, and demor-alized, draining them of their energy,enthusiasm, and self-esteem. Peoplewho are miserable in their jobs dreadgoing to work and come home frus-trated, defeated, and weary. Overtime, this dull pain erodes their confi-dence and passion and affects theirfamily and friends. Miserable jobs canbe found in every industry and atevery level. Job misery spans allincome levels, ages, and geography.
Three out of four people hate theirjobs—and this misery costs employers$350 billion a year in lost productivity.Job dissatisfaction kills morale anddrives up the cost of recruiting, hiring,and retraining employees. Here arethree signs of a miserable job:
1. Anonymity. Anonymity is thefeeling that employees get when theyrealize that their manager has littleinterest in them as a human beingand that they know little about theirlives, their aspirations and interests.Regard-less of how much money theymake or how much they love thenature of the work they do, peoplecan’t be fulfilled at work unless theirmanager knows and cares about themas unique individuals. Most peoplebelieve their managers don’t under-stand them and aren’t genuinely inter-ested in them.
2. Irrelevance. Irrelevance takes root
Many managers are embarrassed orafraid to try, fearing that people willsee them as being disingenuous ormanipulative. Some managers down-play the impact of the human elementon job productivity and fulfillment,often because they are embarrassedabout being emotionally open oruncomfortable with showing interestin their people.
4. Political correctness. Duringinterviews, managers are told to avoidany personal questions that might beconstrued as discriminatory or irrele-vant to the job. And when people startworking for them, many managerscontinue to deal with them at an arm’slength, rather than treating them ashuman beings with families, aspira-tions, and hobbies. They fear that by
taking an interest in theirpersonal lives they stepinto inappropriate territo-ry. Indeed, in the interviewprocess, no personal ques-tions are allowed, but inthe work experience, youneed to treat people likefull human beings.
No excuse is valid for amanager who avoids treat-ing people like the three-
dimensional human beings theyare—mothers, fathers, sisters, brothers,grandparents and neighbors, all ofwhom have a need to be known by theperson who oversees their work.
WWhhaatt MMaannaaggeerrss CCaann DDooManagers who struggle to show
interest in their people need to dothese two things:
First, they need to overcome theirfear of being politically incorrect. Yes,managers need to be careful about thepersonal questions they ask in inter-views. But once the person is onboard, managers should act likehuman beings—not the automatonsthat our legal system requires them tobe during the interview process.
Second, they need to overcome theirfear of coming across as insincere. Theyneed the courage and wisdom to real-ize that it is okay if employees initiallysuspect that they are being manipula-tive—the truth about their intentionswill become clear after they demon-strate consistent, genuine interest intheir employees as people.
Job misery at work is costly, unnec-essary, and treatable when managersapproach their jobs so that employeesfind true fulfillment and satisfaction intheir jobs.
by Patrick Lencioni
L e a d e r s h i p E x c e l l e n c e 5
MANAGEMENT SATISFACTION
O v e r c o m e j o b m i s e r y .
WWhhaatt EEmmppllooyyeeeess CCaann DDooMiserable employees can do three
things to improve their situation:First they can assess whether their
manager is interested in and capable ofaddressing the three things that arerequired. And they have to realize thatmost managers really do want toimprove, in spite of the fact that theymay seem disinterested.
Second, they need to help their man-agers understand what they need. Ifthey have a strong relationship withtheir manager, they can say it (“Youknow, it would mean a lot to me if youknew more about who I am and whatmakes me tick.” or, “Can you help meunderstand why this work I’m doingmakes a difference to someone?”).
Third, they could start doing fortheir managers what they want forthemselves. For instance, employeeswho take a greater interest in the life oftheir managers are bound to infectthem with the same kind of humaninterest. Similarly, employees who takethe time to tell their managers (with-out sucking-up) about the impact theyhave on their job satisfaction, willinspire them to respond in kind.However, if an employee concludesthat his or her manager is completelydisinterested in helping them find ful-fillment in their work, it may well betime to start looking for a new job.
Even professional athletes and enter-tainers can be miserable in their jobs. Inspite of the money they make and theattention they receive from fans and themedia, many experience the three signsof a miserable job. Most pro athletesfeel anonymous in their jobs becausetheir coaches and managers dedicatelittle, if any, time or energy getting toknow them personally.
Some coaches think: “These guysare professionals—they don’t needanything special from me.” Rememberthat they are referring to young men intheir early twenties who are living ontheir own for the first time and feelsurprisingly alone, even with all thefan attention.
Many actors and entertainers can’treconcile their celebrity and wealth withthe fact that they see their work as beingsomewhat unimportant, in terms ofimpacting the lives of others. Perhapsthat’s why many of them get involvedin charitable causes or politics—it givesthem a sense of purpose. LE
Patrick Lencioni is the author of The Three Signs of aMiserable Job and The Five Dysfunctions of a Team. He pro-vides products and services to improve teamwork and effective-ness. Visit www.tablegroup.com.
ACTION: Cultivate job satisfaction.
by Tamar Elkeles
development and assists them inrecruiting and developing top leaders.Companies that brand their LD pro-grams better attract and retain leader-ship talent. Great leaders want to workat companies with other great leaderswho enjoy development opportunities.
At QUALCOMM, we created asuite of LD opportunities and havebranded them. We find that a compre-hensive LD brand is more beneficialand impactful than segmented leader-ship development opportunities.Through awards, external recognition,and external speaking engagements,we’ve built a strong LD brand.
3. Align leadership developmentwith your executives’ personal inter-ests. With the advancement of onlinelearning, podcasting, avatars, webinarsand YouTube, there are many ways todeliver great LD opportunities. Somecompanies offer leadership develop-ment programs that utilize hiking,sporting events, or musical experi-ences to drive a leadership message.Find out what team-building activitiesare important to your top executivesand look for ways to align executive
interests with your LDopportunities.
For example, a fewyears ago, we created aleadership developmentexperience with the SanDiego SymphonyOrchestra. Our CEO waspassionate about the sym-phony, and we discoveredThe Music Paradigm, a pro-gram that uses the
metaphor of a symphony to describean organization and parallels anorchestra conductor to a businessleader. Programs like these are excep-tional at blending executive interestsand providing a solid LD lesson.
4. Prove the worth of your leader-ship development efforts. You do this,of course, by playing the ROI numbersgame (a game worth playing, sinceCFOs often target development pro-grams in budget reviews), but you alsoneed to show videos, tell stories, andshare anecdotes. These and otherstrategies keep LD top of mind.
Focus your time, effort, and invest-ments on creating LD initiatives thatimpact the leadership capabilities ofyour company. LE
Tamar Elkeles, Ph.D. is the author of the book The CLO’s Role:Driving Value Within a Changing Organization ThroughLearning and Development and is the VP of Learning andDevelopment at QUALCOMM.
ACTION: Use these four strategies in your LD.
LEADERSHIP DEVELOP-ment (LD) is crucial
for organizational suc-cess. CEOs, management teams, andboards are interested in developingtheir leadership pipeline. Talentreviews, talent management, executivecoaching, and leaders teaching leadersare some of the strategic initiatives thathave the attention of senior executivesworldwide. Effective use of leadershiptalent through internal mobility anddevelopment is a consistent theme.
Developing leaders has become atop priority for many companies.Investments in LD continue to increaseglobally, and the payoffs enable busi-ness viability and growth.Organizations need to buildleadership capability tomeet the evolving demandsof diversity and complexity.Creating a LD model to max-imize leadership capabilitiesand utilize leadership talenteffectively is a key focus.
FFoouurr PPrroovveenn SSttrraatteeggiieessUse these four strategies.1. Create a LD model that
is driven by your business model. Useyour business model to create keyleadership learning opportunities anda LD model that speaks to your lead-ers. When creating our LD model atQUALCOMM, we used the term “3Gleaders” to describe our top leadershiptalent or high potentials. The businesswas focused on 3rd Generation (3G)wireless technology, and so we capital-ized on the term, enabling us to havesuccess with our engineering and busi-ness leaders. Since business modelssuggest what is important to a compa-ny and its leaders, use them wisely.
2. Build the leadership developmentbrand. Many companies do an excel-lent job of developing leaders andbuilding the leadership brand. Insideand outside of General Electric, forexample, people are aware of theirexceptional Leadership DevelopmentCenter. This benefits GE by demon-strating that they value leadership
LeadershipCapabilityBuild it using four strategies.
LEADERSHIP DEVELOPMENT
6 L e a d e r s h i p E x c e l l e n c e
6.0 In this stage, LD is linked to thekey business results and strategies. Theeffectiveness of LD efforts are mea-sured by their impact on those results.
The first step is to clearly definedesired results so that LD can be tai-lored to achieve them. Some directorsembark on a major LD effort withoutclearly stating the objective or desiredoutcomes. Without clarity of purpose,you can’t evaluate the effectiveness.
Why is the connection between LDand strategy/results often ignored?Few organizations make this connec-tion, and this disconnect is hard to jus-tify ($110 billion was spent on learningand development in the U.S. last year,and $21 billion was spent on LD).
This connection is rarely made forfive reasons: 1) Much executive educa-tion and LD are suppliedby universities, and sinceparticipants come from var-ious companies, it’s difficultto link the learning objec-tives to a strategy or busi-ness outcomes; 2) LD isoften driven by past needs,not future needs, so areaswhere organizations need toexcel going forward are rarelyidentified; 3) LD is a stafffunction, and HR directors are rarelyprivy to the strategic thinking of lineexecutives; 4) The idea that LD candirectly target business strategies isforeign to most line managers; and 5)There are few practical ways to linkLD with business strategy and results.
FFoouurr SStteeppss iinn TTwwoo CCaasseessHow can you best connect LD to
drivers of desired business results? Wesuggest four steps: 1) include desiredoutcome measures in the LD tools; 2)identify the leadership behaviors thatdrive these outcomes; 3) provide LDthat magnifies these key behaviors;and 4) establish practical methods forfollowing up with participants.
Two cases studies show how toapply this approach:
Case study on employee commit-ment. Our first foray into making thisdirect link between LD and resultsbegan when we included an “out-come” measure into our standard 360-degree feedback process. Our researchrevealed that effective leadershipbehavior is highly correlated withemployee commitment and customersatisfaction. For example, Sears foundthat a 5% improvement in employeecommitment measures led to a 1.3%improvement in customer satisfaction,
that in turn led to a 0.5% greaterincrease in store sales. The behaviorsthat most influence employee commit-ment have to do with inspiring people,providing clear direction, and settingstretch goals. Knowing this, wefocused LD efforts on expanding thesepositive behaviors, practicing theseskills, and devising ways for followingup on practicing new behaviors.
Case study on improved decision-making. One client concluded thatleadership decisiveness (effective deci-sion-making techniques and promptdecisions) was a key to high perfor-mance. We developed questions tomeasure the decision-making quality(as seen by the people who reported tothe leader). We then determined thosebehaviors that most highly correlated
with “effective decision-making.” The top fivebehaviors were: 1) has thecourage to make theneeded changes; 2) makesthe difficult decisionsrequired to implementstrategy; 3) makes deci-sions and moves forwardin the face of constantchange; 4) makes high-quality decisions by
engaging the right people and usingthe right methods; 5) inspires others tohigh effort and performance. We creat-ed a LD plan around these five behav-iors and experiences to make theseoperational and measurable with spe-cific methods for following up.
While we’re still exploring the pay-back from this LD approach, initialresults are promising. For example, inthe organization that sought toimprove decision-making, each leaderhad a personal action plan (PAP) andthe senior leadership team identifiedfive issues that cut across the division.Because each manager received indi-vidual assessments on their decision-making effectiveness and theireffectiveness on specific leadershipbehaviors, each person created a PAPto improve personal decision-making.
Leadership 6.0 identifies specificoutcomes along with behaviors thatproduce desired outcomes. It bringstools to measure important results (orthe drivers of those results). It creates avisible, measurable link between LDactivities and desired results, enablingus to identify and discard the duds. LE
John H. Zenger is CEO and Joe Folkman is president ofZenger|Folkman, a leadership performance consultancy. Call801.705.9375, email [email protected], or visit www.zfco.com.
ACTION: Link LD activities with results.
L e a d e r s h i p E x c e l l e n c e 7
LEADERSHIP DEVELOPMENT
by Jack Zenger and Joe Folkman
AS WE SEEK TO IMPROVE OUR LEADER-ship development (LD) programs
and initiatives, we would benefit froma more “evidence-based” approach.
Most HR directors and businessleaders are familiar with a variety ofLD activities, ranging from universityMBA courses to swinging from ropesand kayaking in white-water rapids.The question is: “Which activities pro-duce real value?” The truth is, we don’tknow. Leadership practitioners believeeach program has value, but there islittle or no research to confirm whichones teach important lessons that stickwith participants and get applied.
Our premise is this: You’ll betterdevelop your leaders by engaging inevidence-based research and practice.
First, let’s review how the field ofleadership development has evolved.
1.0 LD began in 1950s when busi-ness schools began teaching leader-ship to balance the need to treat peoplewell with the need to obtain results.
2.0 This stage recognized the needto move LD from a cognitive exerciseto behaviors or skills-based approach.Ideas had to be put into action.
3.0 Improved teaching and highlyengaging learning methods came intovogue. These included case studies,lab learning, action learning, simula-tions, rehearsal of challenging interac-tions, and small-group discussion.
4.0 LD adopted new technologies,including e-learning, to enable large,widely distributed populations to bereached economically.
5.0 LD shifted control and responsibili-ty for learning and development to theindividual. The LD process becamemore personalized, with individualstailoring their development to theirindividual needs.
We are now poised for the nextphase in this evolution—evaluatingLD efforts by their direct impact onbusiness results.
LeadershipDevelopment 6.0Connect LD with drivers of results.
elected president at a time (context)when his personal attributes and mes-sage aligned with that being sought bypeople (followers). Were he to seekelection today, he would need to alignhis message with issues that mesh withour current reality. Martin Luther KingJr. had a wonderful message, but hadhe lived 50 years earlier (context), hecould not have delivered it at the stepsof the Lincoln Memorial. This is whypeople who have great success as lead-ers in one context might fail in others.
Self-awareness is foundational foreffective leadership, along with theability to communicate a vision andhelp others see how they fit into thatvision. Relationships are at the root ofeffective leadership. Leaders connectand establish a relationship with peo-
ple who believe that the leader hastheir best interest at heart. Effectiveleaders intentionally change theirapproach in new contexts, being verydirective with some employees whileactively coaching others.
AAsssseessss YYoouurr LLeeaaddeerr DDeevveellooppmmeennttFor your LD program to take root in
the culture and achieve desired results,you need to address 11 questions:
1. How does the program link tostrategic objectives and goals? Whyand how will LD help us get where wewant to go and meet our objectives?
2. How are we defining leadershipand leadership development? LD initia-tives should rest on a solid theory ofauthentic leadership principles andpractices that provides the roadmap forwhat you hope to develop in others.
3. What are the competencies/skillsyou hope to develop? Most LD trainingincludes personal growth, conceptual
Effective Leadership
EFFECTIVE LEADERSHIPis elusive. It’s like
when we are movedby an incredible performer. Beyondknowing we’ve been moved, we can’tsay why—since describing why weare moved requires another level ofawareness. In the end, the perfor-mance resonates with some and notothers. What moves one person totears may have little effect on another.In many ways, leadership is similar.
Here are three reasons leadershipcan be so elusive.
1. We can’t easily agree on whatleadership means. Most definitions ofleadership assume that it involvesexerting intentional influence to guideor facilitate activities and relationshipsin a group. Influence, more than coer-cion, is the measure, since followersusually have a choice in whether ornot to follow the leader. Leaders influ-ence followers to bring about resultsthat reflect their mutual purposes.Still, we all construe what it means tobe an “effective leader” differently.Some may value a leader who yieldsresults, while another may want aleader who makes them feel good.Some want both! In part, the leaderneeds to understand how followersvalue and construe effective leader-ship to be seen as effective.
2. We construe “how” to best leadothers differently. For example, somepeople dislike the coaching style ofBobby Knight, viewing it as demean-ing, belittling, or unprofessional. Theymight ask, “Did he need to throw achair to make his point?” Others feelthat his behavior is okay since it yieldsresults (wins games), and “how hegets there” is less important. We alldefine effective leader behaviors dif-ferently. Some may not mind a “com-mand and control” approach whileothers appreciate a coaching or “sup-portive” approach. Leaders who excelat one approach tend to struggle whenswitching to a different approach.
3. Leadership is a relationshipbetween the leader, follower, and con-text. For example, Ronald Reagan was
understanding, feedback, and skillbuilding. What do you hope to devel-op in your leaders?
4. What sources of learning will youuse? Sources of learning include 360-feedback, classroom, e-learning, execu-tive coaching, action learning, jobenlargement, mentoring, and develop-mental job assignments.
5. How will the LD program link toour systems? For instance, performancemanagement systems can link to LD.Other examples of business systemsmay include staffing, succession plan-ning and personal development plans.
6. How are we doing at this point?Create a report with five columns relat-ed to the first five questions. List themajor components for each. Place thisinformation in one location where pro-gram architects can review it beforeanswering Question 6.
7. How will we gain feedback fromothers? Float the draft program by oth-ers and seek their feedback. Ask: Whatchallenges do you see with our LDplan? How should we market andimplement this program? What haveyou seen fail and why? Does the cul-ture value what we hope to produce?
8. How will the program be imple-mented? Ensure the implementationstrategy is realistic and manageable.You can roll out the program in threeprimary ways: Pilot—a pilot programis relatively safe and manageable, buttakes extra time. Gradual Implementation—this involves more people quickly,but invites unforeseen “fires” that needto worked through. Full Implementation—this involves the entire organization.
9. How will we market the LD pro-gram? Communicating to your entireworkforce is a challenge. Work closelywith marketing to craft an approachand determine which large-scale com-munications might work best.
10. How will the training be deliv-ered? Catering to one style of learningand one teaching methodology is asure way to fail. You need to place par-ticipants into the hands of qualityinstructors who quickly connect andgain credibility. Participants must feelthat the LD will help them in their roles.
11. How will you evaluate/showROI? How will decision-makers deter-mine the success of the program? Askdecision makers what they think.
These questions enable you to createa powerful LD program. LE
Scott J. Allen, Ph.D., is president of the Center for LeaderDevelopment. Email [email protected] or visit www.centerfor-leaderdevelopment.com or call 216-224-7072.
ACTION: Assess your leadership development.
by Scott J. Allen
8 L e a d e r s h i p E x c e l l e n c e
LEADERSHIP EFFECTIVENESS
Assess how well you are developing your leaders .
How do they do it? Gifted changeagents know that to have great lever-age in solving problems, you mustfocus on changing a few high-leveragevital behaviors. Jack Welch understoodthe power of vital behaviors when hespent decades trying to foster candidand open dialogue at General Electric.His belief was that this one behaviorwould profoundly affect many otherbehaviors for the better. And it did.
In a quest to eradicate the world’slargest human parasite, the Guineaworm, from the West Asian and sub-Saharan world, Donald Hopkins andhis team at the Carter Center realizedthey could eradicate the worm fromany water source or village by focus-ing on three vital behaviors: 1) All vil-lagers must filter their water; 2)
Anyone who has a guinea worm muststay away from the water source; and3) Each villager must candidly con-front anyone who does not complywith the first two behaviors. If everyvillager would enact these three vitalbehaviors consistently for a year, thelife-cycle would be broken and theguinea worm eradicated!
However, the influence processdoes not stop at identifying the vitalbehaviors. Now the influencers mustensure that everyone engages in thevital behaviors—every time, all thetime—and without exception. How dothe Influencers accomplish this seem-ingly impossible feat and get people toadopt the vital behaviors?
SSiixx SSoouurrcceess ooff IInnfflluueenncceeSix sources of influence drive our
behavior—and if we hope to increaseour influence, we must be adept atemploying these sources. Often weassume that if we just train people, or
Master Influencers
WE ARE SURROUNDEDby profound,
pervasive, and persis-tent problems—AIDS, poverty, globalwarming, drug addiction, crime,divorce, obesity—problems so com-plex that they leave us feeling baffled.
Our workplaces are not immune.As leaders, we develop compellingstrategies that are certain to capturemarket share or increase sales; butthen people fail to execute the plan (85percent of all major projects and initia-tives fail to achieve the desired objec-tives on time and on budget).
As leaders, when we face suchresults, we panic. We scramble tobackfill, outsource, restructure, reorga-nize, and plug the gaps. We may try,heroically, to treat the symptoms, butdespite our interventions, the pro-found, pervasive problems persist.
How do we deal with these prob-lems? We cope. When our repeatedattempts at change fail, we settle forthings as they are. When things don’tchange, it’s not necessarily because welack the courage to change them.Often we lack the skill.
Fortunately, we can learn from gift-ed change agents and influence mas-ters. Consider a few examples.• Mimi Silbert of the Delancey Street
Foundation has rehabilitated 14,000hardened criminals (drug addicts,gang members, thieves, and prosti-tutes) with 10 percent recidivism rates(California’s rate is 70 percent).• Mike Miller doubled productivity
in the Sprint IT Department andimproved systems availability for theend user by 90 percent.• Don Hopkins of The Carter Center
has decreased the impact of one of thelargest human parasites—reducingcases from 3.5 million to less than10,000 without traditional medicinesor a vaccine (a 99.7 percent drop)!• Don Berwick of the Institute for
Healthcare Improvement waged a bat-tle against medical errors and is credit-ed for saving more than 122,000 lives in18 months. He’s now launched a cam-paign to prevent five million cases ofpreventable deaths, and getting it done.
just restructure, or just implement anew performance management pro-gram, behavior will change.
The first thing to look at in influenc-ing someone is motivation—does theperson want to do the vital behavior?Next look at ability—is the person ableto do the vital behavior? A personmust be both willing and able to dothe behavior for it to be adopted.
Three areas of influence impactpeople’s motivation and ability: per-sonal, social, and structural. All threemake up the Six Sources of Influence.
Source 1: Personal motivation. Doesthe individual want to do the vitalbehavior? Influencers connect vitalbehaviors to intrinsic motives so theindividual enjoys doing it or links it toimportant purposes.
Source 2: Personal ability. Does theindividual have the knowledge, exper-tise, acumen, or emotional strength todo the behavior? Influencers educate,train, and apply deliberate practice.
Source 3: Social motivation. How doothers affect motivation? Does peerpressure or the boss’s opinion affect theperson’s desire to do the vital behav-iors? Influencers enlist the support ofopinion leaders and formal leaders.
Source 4: Social ability. Do othershelp or hinder the individual’s perfor-mance of the vital behaviors? Do theyprovide resources or create barriers?Influencers enlist the help of others,including coaches and mentors, duringcrucial moments in changing habits.
Source 5: Structural motivation.How do the external motivators (likepay, recognition, and reward systems)affect the individual’s motivation?What costs are associated with thebehavior? Influencers align structuralfactors to reward and encourage theindividual’s motivation to enact thevital behaviors.
Source 6: Structural ability. How dothe non-human factors (environment,structures, policies, systems, andresources) affect the person’s ability todo the behavior? Influencers makegood behaviors easier and bad behav-iors harder through use of physicalsurroundings, cues, and information.
Influencers identify the vital behav-iors that will produce desired results.They then use Six Sources of Influenceto ensure that people enact the vitalbehaviors every time. In this way,problems give way to solutions. LE
Ron McMillan is coauthor of Influencer: The Power to ChangeAnything, (McGraw-Hill) and Crucial Conversations. He isalso a speaker, consultant and cofounder of VitalSmarts, aninnovator in corporate training and performance.
ACTION: Become a master influencer.
by Ron McMillan
L e a d e r s h i p E x c e l l e n c e 9
COMPETENCY INFLUENCE
T h e y h a v e t h e p o w e r t o c h a n g e .
ity and disaggregate challenges of scaleand global diversity. Yet GM’s perfor-mance over the last 10 years has beendisappointing. It appears that the infor-mal construct is missing. However, acloser look in certain high-performingareas suggests a less obvious answer.
At the plant level, we find manyexamples of leaders who use the infor-mal elements to motivate their peopleto higher performance. We probed thebehaviors of over 20 plant managerswhose employees were emotionallycommitted in ways that generatedhigher performance. In each case, their“secret” was using different elementsof their informal organization to instillpride in the work (easier said thandone, since GM leadership is focusedmainly on the formal elements).
The emotional commitment that
yields peak performance requires theformal and the informal to re-enforceand balance one another. Such com-mitment helps people energeticallypursue innovations, collaborate pro-ductively in teams, and provide supe-rior customer service. Whereas mostmanagers over-rely on the formal, themaster motivators work to keep theinformal in balance. They find a wayto capitalize on informal elements tokeep people feeling good about thework they do. Simply put, they dowhat most good managers do not do.
AAeettnnaa’’ss IInnffoorrmmaall SSeeccrreettAetna’s turnaround between 2002
and 2007 is well documented on theformal side. But CEO Jack Rowe alsoknew the importance of creating astrong, engaged culture during theirturnaround. He realized that he wouldneed to engage the informal as well asthe formal organization to reshapeAetna’s legacy culture. So, Rowe
Peak Performance launched a series of informal, interac-tive discussions, involving hundreds ofpeople, to reexamine Aetna’s values. Atthe end of every session, detailed feed-back was developed as to how to bringthese values to life again and reflect thenew marketplace realities. These ses-sions provided a process for engaging,energizing, and co-opting people at alllevels. The feedback formed the basisfor a comprehensive value statementthat became known as “The AetnaWay” and led Aetna’s culture throughthe difficult turnaround years.
One compelling moment occurredearly in the transformation whenRowe, Ron Williams, and their seniorteam were explaining the new strategyto several hundred Aetna people in alogical, analytical way. At the conclu-sion, Rowe took questions. One camefrom a long-service employee namedJeanne: “Dr. Rowe, what does all thismean for someone like me?”
Rowe mulled over his answer:“Jeanne, I guess it is all about restoringthe Aetna Pride.” Rowe received aspontaneous, standing ovation, andthat simple, almost accidental notionbecame the overriding theme thatenergized people. That’s how the infor-mal organization works when it works.
leaders pay as much attention to ele-ments of their informal organization asthey do the formal. They sense thatunless they influence and mobilize theinformal elements, they won’t sustainthe emotional commitment that peakperformance requires. In start-up ven-tures, the informal construct predomi-nates and actively resists any increasein formal process and structure—untilscale and complexity threaten to over-whelm it and therefore demand theefficiency, predictability, and controlthat the formal organization provides.
In large enterprises like GM,because of scale and complexity, theformal elements often drive the infor-mal underground. Realizing the infor-mal advantage lies in integrating theinformal organization with the formalorganization. The required balance canshift over time—a startup’s needs aredifferent than a global enterprises—butboth need to be considered to realizebreakthroughs in performance. LE
Zia Khan is a principal and Jon R. Katzenbach is senior partner inKatzenbach Partners. They are coauthors of The InformalAdvantage (how to achieve performance breakthroughs). [email protected] or [email protected].
ACTION: Gain the informal advantage.
1 0 L e a d e r s h i p E x c e l l e n c e
MANAGEMENT MOTIVATION
S e e k a n d g a i n t h e i n f o r m a l a d v a n t a g e .
by Zia Khan and Jon Katzenbach
EVERY ORGANIZATION HAS BOTH FORMALand informal sides. The formal is
well documented—you find it instrategic plans, structural charts,processes, plans, metrics and pro-grams. But, the informal side consistsof behavioral influences that reside inpeople’s hearts, mind-sets, relation-ships, interactions, and emotions.
The informal organization influ-ences behaviors when and where theformal cannot. Organizations thatintegrate and balance the informalwith the formal have “the informaladvantage”. They deliberately managetheir culture, networks, communities,and source of pride to achieve higherperformance in a way that balancestheir formal organization.
When Jim Rogers was president ofGE’s Electric Motors and IndustrialSystems business, we asked him for acopy of his formal organization chart.When he couldn’t come up with it, hesaid: “I know it’s here somewherebecause I send a copy to corporateevery year. But I never use it becauseit’s not how things really work here.”In Jim’s case, what’s on paper doesn’tdetermine how people collaborate,what values guide their decisions, orwhat motivates their performance.
GGeenneerraall MMoottoorrss’’ IImmbbaallaanncceeGM represents a classic example of
over-emphasis on the formal organi-zation. In 2003, GM looked like mostlarge enterprises; their formal con-struct was well-developed and docu-mented, and rigorously enforced.Their strategy, structure, and process-es were well-designed and followed.Their “balanced scorecard” of over 20distinct measures defined manufactur-ing excellence. They were the posterchild for the decentralized philosophythat Alfred Sloan developed 70 yearsago. Many large organizations stilldraw upon GM’s decentralized modelas they pursue individual accountabil-
dence in their judgment and ability.Few attributes are as closely associ-
ated with effective leadership as deci-siveness. Particularly in moments ofopportunity or crisis, we expect ourleaders to take swift, sure action—andthen to remain steadfast on their cho-sen course of action. We like to thinkthat our leaders are of firm grasp andsure vision. History celebrates leaderswho display “grace under pressure.”
In the media, flip-flopping is oftendemonized. During the 2004 U.S. presi-dential campaign, charges of flip-flop-ping dogged John Kerry. Theimplication was we couldn’t (andshouldn’t) trust a man who flips hisposition. More recently, the tag “flip-flopper” has been placed on SenatorHilary Clinton over her position on theIraq war. Today, it seems theworst thing leaders can dois change their minds.
I find that notion worri-some. Leaders must be ableto flip-flop without fear,especially when the pace ofchange—and the onslaughtof fresh information regard-ing emerging threats—con-fronts leaders with calls forurgent response and contin-ual innovation when adjusting tochanged circumstances.
Flip-flopping is not the same as inde-cision. Indecision reflects the inability ofa leader to arrive at a decision. Certainlyno one admires leaders who sit on thefence, torn by doubt and indecision,pondering options and drawing carefuldecision trees while the moment of deci-sion passes. But changing your mindmeans altering your stance after an ini-tial decision has been made. In manysituations, changing direction is simplythe right course of action. Obviously,leaders should flip when they feel thatthey’ve made the wrong decision.
FFiivvee TTiippss ttoo MMaaiinnttaaiinn TTrruussttHow can you change your mind
and course without losing others’ trustin your commitments, judgment, andcompetence? Here are five tips:
1. Maintain transparency with respectto your decisions and the motives behindthem. Tom Meholn of North AmericanTool and Die Corporation noted that tobe trusted, you had to be open and upfront about every decision, every day,with every employee and every cus-tomer, no matter how big or small thedecision or issue. To achieve transparen-cy, leaders should openly and honestlyexplain what’s changed their minds,
Course Correction
TRUST IS AN IMPORTANTasset for a leader—
it’s the “coin of therealm.” When leaders are trusted, peo-ple are more likely to accept what theysay at face value, accept directives, anddefer to leaders’ judgments. Trustgreatly reduces the transaction costs ofleading—to the benefit of both leadersand all stakeholders. Trust builds rep-utational capital on which a leader candraw when trying to get work done.
Since trust is vital to effective lead-ership, how do you best build trust,communicate trustworthiness, andrepair trust when it is threatened ordamaged? When it comes to gettingadvice on how to create and sustaintrust, leaders can turn to many sources.
Fortunately, we know a great dealabout the conditions under whichtrust flourishes or withers. The compo-nents that contribute to trust include:1) trust in the leader’s intentions andmotives—we tend to trust leaderswhen we have confidence in thebenevolence of their motives, andwhen we think they have our interestsand welfare at heart; and 2) trust in theleader’s competence, confidence intheir ability to carry out their fiduciaryresponsibilities, and their capacity tofollow through on their promises andcommitments. Even if we have confi-dence in a leader’s good intentions, ifwe don’t think they are competent wewon’t trust them deeply or for long.When either component is missing,trust in a leader remains problematic.
One occasion that prompts con-cerns about the stability or consistencyof a leader’s intentions and motives(as well as their competence) is when aleader seems to “flip-flop” on impor-tant issues. Flip-flopping (or even theappearance of it) raises doubts about aleader’s foresight in leading us into asituation or steadfastness when thegoing gets tough. Indeed, the indict-ment of being a “cut and run” leadercan be damning for those leaders hop-ing to retain their credibility.
So, how can leaders maintain trustwhile changing course? Leaders needto skillfully frame and justify changesof course to sustain people’s confi-
and why a new course is mandated ormay be beneficial.
2. Find a positive framing for thechange. On occasion, an unexpectedchange of policy or direction can evenset the stage for great achievement bydramatically recasting an earlier issueor decision. Ronald Reagan rode intothe White House denouncing theSoviet Union as an evil empire. But hearticulated a new vision toward theend of his administration, and began towork closely with Mikhail Gorbachevto help bring an end to the Cold War.
3. Changing course also requires self-trust. Changing course isn’t easy.Leaders face formidable pressures tostand by their decisions. In anxioustimes, we yearn for consistency andpredictability. We seem to want, and to
respond best, to those lead-ers who are consistent andsteadfast in their views andvision. Leaders can beuncomfortable with incon-sistency—it can cause themto experience doubt,because it calls into ques-tion aspects of their coreidentity or values. Mostleaders want to appearstrong, resolute, and unwa-
vering. They care about their images.Since leaders’ decisions are often pub-lic events, it makes reversing coursedifficult. In the media, every decision issubject to endless scrutiny and replay.
4. Have the confidence and courageto recognize that changing your minddoes not signal an inability to lead.Rather, it signals your ability to learnfrom experience, and to adapt to cir-cumstances. In today’s world, in whichleaders can face, on a moment’s notice,changed circumstances, the ability tochange course while maintaining trustis essential. Foolish consistency reallyis the hobgoblin of small minds—andthat’s foolishness we can ill afford.
5. Build your credibility. Since lead-ers need the option to re-decide, theyshould lay the groundwork for rever-sals well in advance by building credi-bility. Leaders need to explain themotives and intentions behind theirchange of course in ways that are com-pelling and reassuring. If done well,they send a powerful message to allstakeholders that they aren’t afraid totake a second look at any decision andto change their mind when it is ineveryone’s long-term interests. LE
Roderick M. Kramer is a professor of management at StanfordGSB. Email [email protected].
ACTION: Maintain trust during transitions.
by Roderick Kramer
L e a d e r s h i p E x c e l l e n c e 1 1
CHANGE TRUST
Sustain trust during change.
capital, especially during tough times,pays huge dividends. Clearly, compa-nies that continue to invest in their tal-ent are better positioned to takeadvantage of recovering markets. Theyinvest time and money planning forthe future—selecting, training, andretaining the next generation of lead-ers. By staying committed to high per-formance succession and LD practices,TGE, Pepsi, Motorola, Goldman Sachs,and HP have strengthened their posi-tion in attracting and retaining top tal-ent, making them talent magnets.
2. Build leadership excellence, evenin challenging times. High-performingorganizations recruit top talent andplace them on focused, driven teams.They let their skills, drive, intelligence,and creativity come to the fore. They
train them and focus their energy onrewarding challenges. They give themthe place, space, knowledge, andchance to excel. They build a leader-ship team across boundaries of func-tion, geography, and business with aclear, common vision and strategy.
The LD programs at UBS, GE, andDell use a combination of presenters,learning technologies, and post-pro-gram project work to reinforce strate-gic initiatives. When leaders train andwork together, they gain commonvocabulary, shared skill-building, andstronger reinforcement and teams.
3. Bring in the best people and bringout the best in people. There is nothingwrong with your people that can’t befixed by what is right with your peo-ple. Leading companies identify andbuild on strengths. They find and nur-ture champions, create compellinggoals and direction, build skills, andspread enthusiasm. They encourage,excite, teach, listen and facilitate. They
Why Develop Leaders?
HIGH PERFORMANCEleaders are distin-
guished by a set ofcore beliefs and actions. They believethat a business rises and falls on thestrength of its leaders at all levels.They identify, attract, and retain themost talented, diverse group of highperformers. They understand the corecompetencies and skills required tomeet challenging goals and surroundthemselves with highly capable staff.
These leaders encourage develop-ment by rewarding excellence, servingas role models, and encouraging per-sonal and professional growth. Theypush decision-making down anddevelop people’s confidence in theirability to lead, manage, and impactoutcomes. They allocate authority andresources to enable people to makedecisions and act independently with-in their area of responsibility.
They believe in the strength, capac-ity and potential for growth and con-tribution of their people, and bytranslating their commitment to con-sistent, purposeful action, even underfire, they pass the test of true leader-ship. They view the cost of LD as aninvestment. The impact of their deci-sion to develop their human capital isenormous. It is like when a small peb-ble makes a big ripple on a still lake.
For years, we’ve talked about theWar for Talent. We revised vision state-ments to emphasize acquiring, devel-oping, and retaining talent, promisingto create a high-performance culture.Yet, in challenging times, such promis-es are rarely kept, as people are oftentreated as liabilities. When leadersrestructure, reduce discretionaryspending, defer product development,out-source manufacturing, pursue vol-untary retirements and resort to lay-offs, the War for Talent gets lost.
SSeevveenn LLeessssoonnss ttoo BBee LLeeaarrnneeddHere are seven lessons:1. Success over time hinges on the
quality of leadership. Organizationsthat invest in leadership outperformthe field. Paying attention to human
tap, orchestrate and use the talents andskills of their teams. They’re support-ers, resource-providers, obstacle-removers, facilitators, and team-builders. The mark of an excellentleader is the performance of the team!
4. Keep the fires burning. Whengrowth stops, people lose motivationand energy. Individuals identified asmarginal performers need to receivespecial management attention. Perform-ance is a function of goal clarity, sup-portive structure, adequate resources,required skills, performance-enhancingfeedback, motivation, and relationshipswith supervisors. Instead of eliminatingplateaued managers, ask: How can wekeep them motivated? Continuingopportunity keeps people working withhigh effort and enthusiasm.
5. Culture counts, especially duringtough times. Business flows in cycles,and the best leaders are constantlysearching for market opportunities andthreats and take quick, creative action,allocating resources (time, talent andcapital) to pursue opportunities. De-cisions are made quickly, and vision istranslated into action. During constantchange, the ability to learn faster is asource of competitive advantage.
6. Paying attention to human capi-tal pays off on the bottom line. We seea strong correlation between compa-nies listed as “Best Places to Work”and superior business performance.Firms with well-designed successionplanning and LD programs for the topthree levels of management enjoy aclear advantage. When you invest inyour people, you invest in your suc-cess: productivity, employee satisfac-tion, and financial performance rise.
TRW offers quality LD programs;HP has phenomenal on-line learning.
7. Stand up for your beliefs. The Warfor Talent will be won by organizationsthat believe in the strength, capacity,potential for growth and contributionof their people, and have the courageand commitment to keep their promis-es through thick and thin and do theright thing for their employees, brands,company and society, even when pro-fessional and social risks or economicpressures confront them. This principleanchors their beliefs and behaviors.
The only sustainable source of com-petitive advantage is the capacity ofyour people to learn, grow, and out-perform the competition. LE
Michael G. Winston is strategist of transformation. He has top-level experience in five Fortune 100 Companies. Visitwww.michaelgwinston.com.
ACTION: Excel in your leadership development.
by Michael G. Winston
1 2 L e a d e r s h i p E x c e l l e n c e
LEADERSHIP DEVELOPMENT
S m a l l p e b b l e s c a n h a v e b i g r i p p l e s .
TTaakkee TThhrreeee SStteeppss!!On its path to training excellence,
Carnival has implemented three steps: 1. Focus. In 1994, at the directive of
Carnival’s president, the company’svision was defined: “To consistentlyprovide quality cruise vacations thatexceed the expectation of our guests.”This vision was carried to the entireCarnival team—not just to memorize itbut also to personalize it. Team mem-bers attended a session that was allabout them. Activities included focus-ing on personal and professional goalsand how their service role impacts ourguests and can advance their goals.
2. Invest. In 1995, Carnival’s presi-dent established corporate training toenhance guests’ vacation experience byproviding employees with innovativeand relevant professional development
while emphasizing safety and regulato-ry issues and hospitality. Training alsooversees the weekly e-publication,eSeaview, and quarterly 36-page SeaviewMagazine, and Carnival CorporateUniversity, a program in which groupssail aboard the line’s ships and partici-pate in fun, interactive professional-development workshops and seminars.
This training has enhanced commu-nication shoreside and shipboard. Webelieve that the learning that takes placeis proportional to the fun people have.
One effective program is “Coachingthe Champions,” a high-impact devel-opment program for managers, highpotentials, and senior leadership.
Despite the challenges of bringingpeople together in one location, over thepast 10 years, the program has trained700 managers each summer. Sessions areheld in a land-based location for week-long seminars, simulations and teamdevelopment activities. Training also
Leadership Development
CARNIVAL CRUISELines, the largest
and most popularcruise operator, carries 3.6 millionguests a year and achieves a 98.3 per-cent satisfaction rating. Founded witha single ship in 1972, Carnival revolu-tionized the cruise industry with the“Fun Ship” concept; for the past 35years, the line has been synonymouswith quality, value, and fun. Today weare more dedicated than ever to pro-viding cruise vacations that exceed theexpectations of our guests. With a fleetof 22 state-of-the-art vessels and threenew ships on order, Carnival continuesto reach new heights. With the U.S.debut of its “Fun Ship,” the 110,000-tonCarnival Freedom, Carnival will bolsterits record-breaking 2007 Caribbeancruise season when it will carry 3 mil-lion guests within that region alone.
One constant is the friendly andattentive service we provide our val-ued guests. Carnival employs 36,500shipboard and shoreside employeeswho come from more than 100 coun-tries, with highly diverse skill sets andworking in constantly moving deliverylocations operating on a 24/7 schedule.
With capacity between 1,800 and3,700 guests and crew counts between660 and 1,200, each ship is like a smallcity, and operations require skilledcraftsmen, highly trained deck andengine officers, and medical and safetypersonnel. There are also chefs, house-keeping staff, service personnel, enter-tainers, and the shoreside counterparts.
How do we keep such a diverse,service-oriented team motivated andprovide opportunities to continue pro-fessional development? Our award-winning training provides a variety ofrequired safety training, as well as hos-pitality and management training toour diverse and varied workforce.
We are sharing our training exper-tise in our new guide, SAIL (StrategicAlignment Involving Leadership) Carnival,which details our efforts to achievequality and support the growth anddevelopment of a global workforcebased on facilitating continued devel-opment of our leadership team.
oversees Carnival College of Manage-ment for new and mid-level shipboardmanagement. Our senior managementis involved in program development,providing input and prioritizing prac-tices. They are typically the first toexamine and participate in new pro-grams. They also serve as instructorsand advocates for learning by sharingtheir experience and expertise. Depart-ment heads—including captains, chiefengineers, and hotel directors—facili-tate several key programs, includingthe Carnival College of Management.
Also, each ship houses a CrewTraining Center that hosts computer-based, instructor-led training and alibrary of resources. An internationalteam of 50 shipboard trainers overseetraining and operation of the facilities.
We evaluate the effectiveness of ourtraining by using the InternationalMaritime Organization, flag state andU.S. regulatory bodies’ standards andregulations, adult learning principles,the Kirkpatrick Four Level EvaluationModel, and other responsiveness, contex-tual, and evaluative inquiry methods.
3. Listen. At the directive of our pres-ident and senior VP of training, aCarnival’s Crew Comment Card systemwas established to provide crews witha platform to voice their opinions andoffer suggestions. Team members andguests provide feedback on the effec-tiveness of Carnival’s leadership devel-opment—guests via comment cards atthe end of the cruise, and crewsthrough bi-annual comment cards.
Based on ratings from these cards,Carnival presents two “EAGLE”awards—one to the top ship for guestservice, and the other to the top ship foroutstanding work environment, takinginto account management, leadership,quality of life, and recreation.
A 10-member quality assurance teamcomprised of senior managers reviewsall comment card results to enhanceproduct quality for guests and the quali-ty of shipboard life for Carnivalemployees. The QA team visits all 22Carnival ships, and hosts discussionswith all shipboard department heads. Ahighlight of these visits is Share theVision, a state-of-the-company presenta-tion open to all shipboard team mem-bers to participate in Q&A sessions.
Since LD is vital to our success, wewill keep introducing effective LD ini-tiatives into our operations. LE
Eileen Tighe, CTC, is Corporate Training Manager forCarnival Cruise Lines. Visit www.carnival.com.
ACTION: Sail away in your LD program.
by Eileen Tighe
L e a d e r s h i p E x c e l l e n c e 1 3
LEADERSHIP DEVELOPMENT
O n t h e m o v e a t C a r n i v a l C r u i s e L i n e s .
guish itself from others with similarofferings and goals, and maintain itssuccess over time? Answering thesequestions is the management agenda.
Each generation of managers mustfind its own direction. In recent years,customers have revolted against theirsuppliers, abandoned companies towhose brands they had been loyal,and embraced generics, house brands,international competitors, and anyonewho offered a better deal. Customersstopped tolerating abuse from suppli-ers who condescended to fill theirorders. They refused to accept highprices, low quality, and dreadful ser-vice. Instead, customers now instructtheir suppliers regarding the pricesthey will pay, the quality they require,and even when they’ll accept delivery.
Executives of even the most power-ful companies now tremble beforetheir independent and demanding cus-tomers. They know customers havethe power and that they will use it.
Welcome to the customer economy.How did this customer power arise?
First, scarcity gave way to abundance,as supply overtook and exceededdemand. Advancing technology dra-matically increased manufacturingproductivity and reduced the costs ofentry to and expansion in many indus-tries. Companies expanded capacity tobuild market share. And globalizationled to more competitors pursuing thesame customers. This increase in sup-ply inevitably put customers in thedriver’s seat. Customers are no longersupplicants for scarce goods; roleshave changed, and sellers havebecome supplicants for scarce buyers.
Customers have become moresophisticated and informed buyers.Customer servitude ended when itbecame practical for them to takeadvantage of alternatives. Informationtechnology (including the Internet)enabled them to find and analyzecompeting products and to make intel-ligent choices. Customers discoveredthey had options and the power toexploit them. As both consumers and
Customer Economy
LEADERS AGAIN MUSTtake “mundane”
issues like cost, quality,and service seriously, as they can nolonger take stock market increasesand growth for granted. They mustworry whether customers will buy,costs will rise, or competitors willovertake them. They now see thatgrowth has to be created, that mostnew ideas fail, that resources arealways scarce, and that business is nota game for giddy amateurs.
Business is about execution—notjust about having the right businessmodel, capturing eyeballs, creating acool work space. Bereft of inflatedstock market evaluations, managersrealize that it’s not enough to get theorder, you have to fill it; that having anidea for a product does you no good ifyou can’t develop and deliver it.
The halcyon days of the 1990s werean aberration. Tough times are thenorm. In normal times, managersmust wrest market share from theircompetitors, motivate customers topart with scarce cash, earn successinstead of having it handed to them,and wake up each morning knowingthat yesterday’s accomplishmentscount for nothing today.
Management is one of the mostcomplex, risky, and uncertain of activ-ity. How could anyone have thoughtotherwise? If managing were simple,why do most businesses fail? Why doso many new products founder? Whydo great companies sustain success forsuch a short time? Why are leadingcompanies overtaken by upstarts?Why do so many managers struggleto replicate their success when theychange companies? Why do so manyfall prey to hucksters, fads, and super-ficial and simplistic remedies?
The challenges of management areextraordinarily difficult. How can acompany devise products and ser-vices that satisfy customers, and thencreate and deliver them in a profitableway that satisfies shareholders? Howcan a company retain customers in theface of new competitors, and respondto new needs without sacrificing itsposition? How does a company distin-
corporations came under pressure tosave money, the inertia of staying withold suppliers became a luxury fewcould afford. As a result, customersnow seek alternatives, compare offers,and hold out for the best option.
Customer power surged as manyproducts became virtual commodities.When technology evolves slowly,products remain different for longperiods. Each product has strengthsand weaknesses that make it the bestchoice for some customers and a poorchoice for others. Rapid changes intechnology shorten product life-cycles.New products soon become obsoleteor imitated. Many similar offeringsmake it difficult to differentiate—andthis further empowers customers.
For example, today, some 25 carcompanies compete for your business.A host of information sources prepareyou to bargain with the dealer from aposition of knowledge and strength.Now you have the upper hand, andthe automakers and dealers know it.
The new customer economy is stillgathering steam, as there’s no foresee-able end to increases in global competi-tion, overcapacity, commoditization,customer knowledge, or to the cus-tomer power that flows from them.
As the customer economy unfolded,organizations sought managerial inno-vation, creating and deploying newways of operating: just-in-time inven-tory management; TQM and six-sigmaquality; cross-functional teams; portfo-lio management and stage gates inproduct development; supply chainintegration, including vendor-man-aged inventories and collaborativeplanning and forecasting; perfor-mance-linked compensation; compe-tency profiling in HR; measurementsystems based on economic valueadded or balanced scorecards; cus-tomer-supplier partnerships; and busi-ness process reengineering.
These innovations were first deploy-ed in industries that felt the brunt ofthe new customer economy—automo-biles, electronics, computers—and thenspread to other sectors. Because ofthese changes, we weathered the firstwave of customer ascendancy. Firmsthat crumbled before the onslaught ofdemanding customers and tough newcompetitors used new managementmethods to claw their way back. Start-up businesses that embodied theseprinciples from the outset outper-formed established competitors andexperienced meteoric growth.
Management innovations enabledthese companies to develop better
by Michael Hammer
1 4 L e a d e r s h i p E x c e l l e n c e
MANAGEMENT EXECUTION
G e t s e r i o u s a b o u t b u s i n e s s .
Customer as BossGo from leader- to customer-centric.
MANAGEMENT CUSTOMERS
spend time in the field and on the floorwhere the action is lively, not in care-fully contrived meetings where theaction is limp. It is one thing to readstatic customer satisfaction reports andquite another to spend time in the fieldgathering first-hand research. The lat-ter can have a far greater impact onleaders’ perception of service quality.• When John Longstreet was GM of
the Harvey Hotel in Plano, Texas, heinvited guests to his office for “secret”assignments that included “call house-keeping at 3 a.m. and request 20 tow-els,” “ask room service for somethingnot on the menu,” or “break a glass inthe restaurant and report what hap-pens.” The guest received a room ratediscount, and John got first-handinformation on his service processes.• Roberto Herencia, president of Banco
Popular North America, invited his keyleaders to join him for a day of shop-ping the bank’s competition. Eachleader was directed to make specific
requests, assuming the per-sonality of an irate, unin-formed, or demandingcustomer. They learned waysto boost service quality.
3. Customers on thedashboard. By giving direc-tion, alteration, mainte-nance, and early warning,dashboards provide part ofthe guidance system need-ed to traverse the market-
place. Whatever is on the dashboardproclaims the priority. If the dashboardis silent regarding customers, employ-ees rightly question its significance.The dashboard encompasses theactions of leaders when tough deci-sions are required. When leaders takea shortcut that improves the bottomline but hurts service quality, employ-ees learn what really matters.
Customer-centric leaders are notjust customer advocates—they arestewards of a culture that relentlesslypursues positive experiences for cus-tomers. Stewardship means staying thecourse until new behaviors are imbed-ded—and remaining vigilant for any-thing that imperils customer-focus.
When customers spot organizationsthat operate on their behalf, theyreward them with their loyalty andmoney. Leaders need to keep the spot-light on customers, since they can fireanybody in the company. LE
Chip Bell is founder of The Chip Bell Group and John Pattersonis president of Progressive Insights. They are coauthors ofCustomer Loyalty Guaranteed! Create, Lead and SustainRemarkable Customer Service. Visit www.chipbell.com.
ACTION: Make the customer the boss.
products quicker, and to manufacturethem more reliably and at lower cost.They allowed companies to get moreout of their plants, operate with lessinventory, reduce waste and errors, fillorders more quickly, and respond withalacrity to customers’ requests. Higherproductivity, lower costs, better quality,and improved service were the results,and they translated into payoffs:Customers got better products at lowerprices, workers had secure jobs, andshareholders earned higher profits.
In the customer economy, yesterday’sinnovation is baseline today and obso-lete tomorrow. What was once unimag-inable quickly becomes routine, andthen expectations are raised higher. It isthe nature of customers to constantlydemand more—more value for lesscost, more innovation, more service.Companies that don’t keep up withtheir demands are abandoned.
Operating in the customer economydemands more than customer intima-cy. Customer power must be reflectedin how a company is managed, fromhow work is done to how people arerewarded to how it is organized—adapting every aspect of business tothe reality of customer dominance.
The agenda for the customer econo-my has nine elements. The first twotranslate platitudes about customersinto concrete action by distinguishingcompanies from look-alike competitorsand creating loyal customers. Items 3and 4 deal with process. To achievehigher performance, businesses mustorganize and manage around the axisof process and apply the discipline ofprocess to all aspects of their opera-tions. Principle 5 demands a newapproach to measurement—one thatlocates it squarely in the center of asystematic approach to improving per-formance. Item 6 is to redefine the roleof managers from autonomous chiefsof narrow domains into team playerswhose scope is the entire business.Items 7, 8, and 9 harness Internetpower to link companies. Distributionmust be redesigned from the perspec-tive of the final customer. Companiesmust knock down the walls that addoverhead and inefficiency, through col-laboration and inter-enterprise processintegration, and position themselves ascomponents of virtually extendedenterprises.
Innovation can’t be bought in a store—it must be brewed at home. LE
Michael Hammer is the author of The Agenda: What EveryBusiness Must Do to Dominate the Decade (Crown). Visitwww.michaelhammer.com.
ACTION: Translate these principles into realities.
by Chip R. Bell and John R. Patterson
WHEN ORGANIZATIONS ARE LED BYcharismatic, demanding or mem-
orable leaders, the focus often turns tocompliance, obedience, or obsessionwith the leader’s way, style and vision.
Centering on customers takes leaderswho are more interested in excellencethan ego. It takes a total alteration inagenda, attitude, and action. To makethe shift, employ three strategies.
1. Customers in theboardroom. Make the cus-tomer’s presence come alivein operations. Invite cus-tomers to attend meetingsnormally reserved foremployees and to partici-pate in the design of prod-ucts and services. Getfeedback from customers onprocesses that determinetheir experience. Leadersneed to model listening to customers. • At MBNA, senior executives spend
four hours a month on the phonesmonitoring customer calls. It is not justabout what they learn; it is about whatthey signal as top priority. Modelingalso means paying attention to whatcustomers see and feel. When managersassist customers in a busy time, theycommunicate customer-centric.• eBay invites 12 users every 60 days
to participate in its Voice of theCustomer program. These people visitdepartments to talk about ways toimprove service. Then, every monthfor six months, they reassemble toexplore emerging issues and makemajor service enhancements.• Duke Energy has used a Boards of
Customers program in the regions theyserve. Experienced customers volun-teer time each quarter to act as sound-ing boards for new products andservices. They became a key conduitfor feedback and service improvement.
2. Leaders in the customer’s world.Customer-centric leaders hunt for gen-uine encounters with customers. They
L e a d e r s h i p E x c e l l e n c e 1 5
to creatively attack the status quo. Youcan become trapped by legacy prac-tices and thinking. These things hap-pen for three reasons: 1) successfulorganizations tend to lose their senseof urgency; 2) they get proud and pro-tective; and 3) they get an entitlementmentality. They can’t imagine a worldwhere they’re not on top.
BBee PPrrooaaccttiivveeThese problems can be avoided.
Toyota has prospered for 30 years withits culture of continuous improvement,and Procter & Gamble thrives by find-ing unarticulated consumer needs.
By being proactive, you can avoidseven dangerous traps: 1) sticking withyesterday’s business model; 2) allowingyour products to slip into mediocrity; 3)clinging to branding as it becomes staleand boring; 4) letting your processesget cumbersome and complex; 5) hiringexcessively, leading to lack of speedand agility; 6) not confronting poor per-formers; and 7) not stretching your staremployees. Such things signal thatyou’re being seduced by success!
Observe these seven tips:Business model: Avoid committees
and consensus in developing big, dis-tinctive model advantages.Individuals have big, distinc-tive ideas; committees andconsensus turn big, distinc-tive ideas into mundane ones.
Product: Charge your topperformers to get your prod-ucts out in front of importanttechnology, industry, andcustomer trends, and thenget out of their way.
Branding: Always be fresh, relevant,and distinctive.
Processes: Continually demand newapproaches to “proven” processes, andfor each process there should be a czarwho is personally accountable to makesure the process is always super lean.
People: You need a top-notch per-formance appraisal system to spot thestars and confront the bottom 5 to 7percent, and you need a “key peopledevelopment program” to continuallystretch and grow the future leaders.
Culture: The focus should be onexcellence in finding and solving prob-lems and jumping on opportunities,and not on basking in prior glory.
Communications: Every employeeshould always know where the organi-zation is going and how it is doing. LE
Robert J. Herbold, former COO of Microsoft, is ManagingDirector of Herbold Group, and author of Seduced by Success(McGraw Hill). Visit www.herboldgroup.com.
ACTION: Don’t be seduced by success.
Seduced By Success
KEEPING UP—WITHtechnology or any-
thing in business orlife—is a fool’s game. When you keepup, you gain no advantage. You justmake yourself like everyone else. Youlearn who the best are and copy them.By the time you get as good as thebest, they’ve moved on to somethingbetter—and you’re still far behind.
Benchmarking is just a way of keep-ing up. When you benchmark, youidentify the best practices of othersand strive to imitate them. Once youreach the benchmarked standards, thecompany that set the benchmark hasmoved on to achieve higher standards.
To gain advantage and stand out,you must set a new standard.Consider these four suggestions.
1. Look to the future. When youplan your future growth, ask three keyquestions: Where are the successfulcompanies evolving to? What path aremy competitors on right now? What’sthe logical progression of the industry?Asking these questions enables you togo beyond your competition and getoff the treadmill of keeping up. Itopens your eyes to future possibili-ties—to stay ahead of the pack insteadof side-by-side with them. Only whenyou go beyond your competition willyou find advantage—and the financialrewards competitive advantage brings.
2. Do what the masses don’t do.Most businesses do the same thing astheir competitors and then wonderwhy they don’t have the upper hand.Everyone is keeping up, but few peo-ple are doing so in a way that producesany real advantage. So, dedicate your-self to finding an advantage and usingit. Don’t just copy what the competi-tion does; rather, look at what they’redoing and then do what they don’t do.If you can’t find anything different todo, then determine if there’s a bettercustomer you can go after—one that’sbetter and different than what every-one else is going after. Can you cus-tomize your product or service for thebetter customer so that the better cus-tomer would want what you offer andnot what the competitor offers? Thisprocess gives you the advantage since
Avoid the success-induced traps.
IN THE MID-1990S,Kodak was king of
photography with itshighly profitable film business.Digital photography was emerging,but Kodak didn’t pay much attentionto it. After the technology started toget traction in 1996 via early versionsof digital cameras from Japanesemanufacturers, Kodak developedand launched a clumsy system calledAdvantix, a digital camera thatrequired film! Clearly Kodak wasthinking defensively, with its goalbeing to protect its film business.
For the next six years, Kodak sawits business decline, and its stockprice plummet from $90 to $30.
In 2003, Kodak announced a 72percent decrease in its dividend andrevealed plans to invest $3 billion indigital photography. Thestock market read this as toolittle too late, and the stockprice decreased another 14percent to $24 per share. Theoutgoing CEO, who hadspent his entire career atKodak, said: “I saw my firstdigital camera at Kodak 20years ago. I knew then thatwe needed to transform thecompany.” Today Kodak is one ofmany players in the digital camerabusiness, and is struggling to find anew reason-for-being.
meaningful success, they believe thatthey are entitled to more success.Managers become complacent andcomfortable. What they should bedoing is building on all the thingsthey have done well in the past.
History is filled with sad stories ofonce-successful companies that, afterreaching the top, could not sustainsuccess. How could GM decline for30 straight years? How can Sony,who invented portable music withthe Walkman, get beat by the iPoddeveloped by a computer company?
Success can be a business vulnera-bility, destroying the ability to see theneed for change and the motivation
1 6 L e a d e r s h i p E x c e l l e n c e
Seek AdvantageKeeping up is a fool’s game.
CHANGE INNOVATION CHANGE INNOVATION
by Daniel Burrusby Robert J. Herbold
born outside this country. Companiesstarted by immigrants employed near-ly half a million workers and generat-ed at least $55 billion in revenue in2006. Our society will undergo evenmore change. The “have-nots” arewatching TV and seeing what they aremissing. And they’re not happy. Smartinnovators know that even a slight risein job growth can translate into mil-lions of new consumers.
What happens “out there” deeplyaffects what happens “in here.” All ofus need to accept change, adapt to it,and accelerate our efforts to accom-plish our goals.
One of my early mentors wasNorman Cousins, editor of theSaturday Review. He was brilliant,sophisticated, kind, humorous andadroit. I learned much from him andwas introduced to many importantcontacts. Some people think that thosewho work in technology today blithelyfloat toward fortunes and that mentor-ship is not needed. However, manysuccessful entrepreneurs, such asGoogle founders Larry Page andSergey Brin, invariably turned to men-tors to guide them.
Technology is just as anenabler. It’s not a substi-tute for clear thinking. ABlackberry or Treo make itpossible to communicateinstantly with someone10,000 miles ways, butyour message still has tobe clear and compelling.Logic, good thinking, solidreasoning, and decentwriting still matter—no
matter how skilled you become withtechnology. You need to communicateyour thoughts sensibly and pithily.
I urge you to seek the best publica-tions and broadcast programs. Theseteach you how to think, organize,express an argument, and observe theevolving world.
Nurture your relationships; don’twait for life to happen to you. Knowwhen to use snail mail. Answer emailwithin 24 hours. Identify the blogs youshould read daily. Make your argu-ments thoughtful and logical. Thinkabout politics, business, arts, entertain-ment, sports, and fashion. Seek tounderstand the social changes. Listento other people. Be relentless, but havesome fun—and do it with style. LE
Robert L. Dilenschneider is Chairman of The DilenschneiderGroup, a strategic counseling firm, and author of Power andInfluence (McGraw-Hill). Visit www.dilenschneiderpower.com.
ACTION: Keep up with trends and set your own.
YOUR PROFESSION ANDindustry are likely
being turned upsidedown, and if you deny reality or fail toadapt to technology, you’ll lose your job.
In New York, I eat three times a weekwith clients at restaurants celebrated for“power lunches” to nurture and sustainprofessional relationships. Now, duringsuch a meal, some executives hoverover laptops, or respond to messages ontheir Blackberries or cell phones, multi-tasking during a multi-course meal!
I used to receive 30 to 40 letters aday. Now, I get two letters and a ton ofjunk mail. Ten years ago, I neverthought of “logging on.” Today, I’mglued to some device that transmitsmy messages 24/7. CEOs used to be inoffice for at least 10 years; now theirtenure is often less thanfive years. Why? Pressurefrom investors and WallStreet; Board concern overlitigation and direction;and many CEOs simplyhave not mastered therapid movement that tech-nology has created.
Keeping up is a requisitefor keeping your job andmoving ahead. More than80 percent of the global populationlives in the 135 developing (poor)countries among the 193 members ofthe U.N. That’s 4 billion people out of6.4 billion. India’s middle class of 400million—out of a population of onebillion plus—is larger than the entireU.S. population. Europe’s populationis becoming more nonwhite as AfricanMuslims and other immigrants con-verge on France, Germany, and GreatBritain. And 50 years from now in theU.S., Hispanics will constitute a majori-ty of the population. Most of the next100 million people in the U.S. will beLatinos. Is your company prepared?
As the Third World melds into theFirst World, people’s aspirations for abetter life rise. Of the 2.3 million peo-ple of Indian origin in the UnitedStates, 200,000 of them are millionaires.One in four founders of technologyand engineering companies started inthe U.S. between 1995 and 2005 was
Keep Up, Move AheadAccept, adapt, accelerate or atrophy.
by Robert L. Dilenschneider
CHANGE TECHNOLOGYyou are more innovative over time.3. Go beyond competing on price.
Most companies focus their strategieson only a few of the many ways togain a competitive advantage. This lim-its their ability to create and sustaintrue competitive advantages. To gain alasting competitive advantage, youneed to go beyond pricing and developa competitive strategy that includes awide spectrum of techniques. Compet-ing on price alone means lower mar-gins, meaning you need high volumeto make up for it. If your intent is to bea competitor of price, you need to real-ize you have many more options. Youcan compete on time, reputation, val-ues, technology, image, experience, ser-vice, design, innovation, quality,information, knowledge, consultativevalue, loyalty, or process. Review thislist and ask yourself, “Do I have a strat-egy for every one of those differentways of competing?” Most companiescompete in only one or two areas andhave a detailed strategy for both. Fewcompete in all areas. To gain an advan-tage, you want a strategy for everyarea. Detail how you are different ineach area so you can go beyond keep-ing up and truly stand out.
4. Don’t imitate—innovate. In thefuture, competition will intensify. So, togain an advantage, you need to differ-entiate yourself from the competition.While it is good to keep track of thecompetition, too many organizationsfocus more attention on “keeping up”than on internal innovation. Perhaps itonce made sense to play the one-upmanship game of keeping up withthe competition. But the dramaticchanges spawned by science and tech-nology have made that a perilous gamefor the present (and a formula forfuture disaster). Those who merely“keep up” are usually so caught up inmeeting their day-to-day challengesthat they can only worry about thefuture, while the real innovators see thepresent as a stepping stone they canuse to get to a bigger and better future.
A new world is taking shape, andno company can afford to hide out inold familiar places. While you need tostay abreast of changes and updateyour company as new technologiesand developments unfold, it’s crucialto distance yourself from the competi-tion and embrace a forward-thinkingmindset to turn tomorrow’s opportu-nities into today’s profits. LE
Daniel Burrus, author of Technotrends, is a technology fore-caster and business strategist. Visit www.Burrus.com or call262-367-0949.
ACTION: Seek to gain a competitive advantage.
L e a d e r s h i p E x c e l l e n c e 1 7
lifestyles led by in extremis leaders likeclimbing guides, SWAT team chiefs,and Army officers broadcast an impor-tant and unmistakable message: “I’mnot in this role merely for personalgain.” Business leaders should be just-ly rewarded in their leadership rolewith comfortable work and familylifestyles. But as the boss, living withsome humility sends a powerful mes-sage; it reflects a lack of ego invest-ment and communicates commitmentto the organization, establishing abasis for trust and loyalty.
4. When you develop com-petence, you develop trustand loyalty. In dangeroussettings, competence is themost important basis fortrust and loyalty. Leaderswho find that people don’ttrust them or are disloyalusually take it personally,almost like a social rebuff.In response, leaders may orchestratesocial events like golf, off-site meet-ings, or other team-building activities.Leader competence is often at the rootof loyalty and trust problems, andcan’t be fixed with a trip to a rock-climbing school. Competence, trust,and loyalty are intertwined. Whenleaders demonstrate competence, theyare developing trust and loyalty. Mostleaders have arrived at their station inlife through their own competence, butthat becomes lost on others unless theleader’s competence is occasionallyrevealed by action. Leaders whoappropriately showcase their abilitygive followers a reason for confidence.
5. Extreme threat reveals the truecharacter of leaders and followers.How people act when things look badis an indication of their fundamentalrelationship with their organizationand their leadership. Adversity unifiesa strong team and destroys a weakone. Leaders must become adept atreading individuals when the stakesare high, especially when the futureappears dim. When your business sur-vives a crisis, take stock on how peo-ple performed and behaved. The bestpredictor of future behavior is pastbehavior, especially in crisis.
6. Use the life-altering character ofyour business to inspire. You’re not a
In Extremis Leaders
THE BEST WAY TOdevelop crisis lead-
ership abilities is todevelop leadership habits similar tothose who lead in life-or-death cir-cumstances—in extremis leaders.Learning from military, police, fire-fighter leaders and extreme sportcoaches overcomes reactive qualities.You have to learn from those who areexperts at leading in high-threatcrises, even if your risks are not of aphysical or life-threatening nature.
EEiigghhtt LLeessssoonnss ttoo LLeeaarrnnHere are eight lessons that you can
learn from in extremis leaders:1. Motivation is most powerful
when paired with learning. Dangermotivates, and leaders in dangerouscontexts channel that motivation.When leaders have followers who arealready motivated by dire threat,tremendous opportunity, or earnestobligation, they should focus every-one’s attention to precursors of learning,such as awareness of the environment,creativity, critical thinking, and out-come analysis. Focus the crisis-motivat-ed crew on breakthrough solutions,seemingly insoluble problems, or unre-solved issues. For average leaders,motivation from crisis is a way to makepeople work harder; for great leaders,it’s a way to help people work smarter.
2. Sharing risk enhances credibility.In extremis leaders place more value ontaking care of their clients, followers,soldiers, and citizens than they placeon their own comfort, personal safety,or wealth. To be the best leader youcan be in a high-stakes situation, you’llgain the most trust and loyalty bydemonstrating that risk and rewardare distributed fairly and that much ofthe risk is your own. The willingnessto assume personal risk is a behavioralcue that the leader has confidence andis putting as much on the line as thepeople he or she is leading. People incrisis often make sense of their envi-ronment by gauging the reactions ofothers, especially their leaders.
3. Your lifestyle reflects what youvalue to followers. The unassuming
leader unless people depend on youfor purpose, motivation, and direction,especially in dangerous conditions. Inresearch interviews, I asked in extremisleaders, “Can you describe a timewhen your leadership had a profoundimpact on the lives of those you led?”One mountain climbing guide said,“People tell me that almost everyweek.” He was inspired, and so werethe people who climbed mountainswith him. To use in extremis lessons inbusiness, “Other People’s Money” hasto become a proxy for “Other People’sLives.” Almost any enterprise has animpact on people’s lives, even if thepeople are simply shareholders, andcalling attention to the life-alteringimpact of a business is an effective wayto inspire an otherwise jaded workforce.
7. Leader effectivenessmay be conditional.Leaders must establish cri-sis-quality credibility andinfluence daily, before pres-sure is brought to bear.Crises tend to reveal poorleadership. Unforgiving inextremis conditions preventleaders and followers fromfooling themselves. What is
the break point for your organizationto decide that things are so bad, that aleader needs to go? Don’t let that breakpoint be a crisis—make the hard callson your own terms and timeline.
8. The best leaders want to be lead-ers. Leaders in dangerous contexts arevirtually all self-selected. In choosingleaders, select people who want to lead,not just advance. Sometimes the allureof the power and rewards associatedwith being a leader gives rise to peoplewho accept a demanding leadershiprole without the commitment, experi-ence, skill, or determination. Howmuch of your ability to lead is basedon positional authority rather thanpeople’s desire to be on your team andto accomplish common goals?
AAsssseessss YYoouurr LLeeaaddeerrsshhiippAssess your influence. Few leaders
can organize people with minimaldependence on HRM tools: remunera-tion, reward, working conditions, jobsecurity, and benefits. Every leader’sgoal should be to retain a functionalorganization through circumstanceswhere those advantages are threatenedor nullified by tough times. LE
Tom Kolditz is Head of Behavioral Sciences and Leadership atthe US Military Academy at West Point, and author of InExtremis Leadership. E-mail [email protected].
ACTION: Develop your ability to lead in crisis.
by Tom Kolditz
1 8 L e a d e r s h i p E x c e l l e n c e
LEADERSHIP CRISES
D e v e l o p c r i s i s l e a d e r s h i p a b i l i t y .
based on physics: capturing waste heatand using it, capturing the energy ofacceleration when decelerating, andheating via heat transfer. The fact that90 percent of total energy is wastedsizes the huge opportunity for us.
Big goals get big results. In the firsthalf of my 30 years at UTC, I wasn’tsure about big goals. We’d think aboutincremental gains, a few percent hereand there. But in the 1990s, we began tothink about bigger goals: three, fourand five times, even ten times. The trickis to have the confidence to set thesehuge goals, to base them on workabletheories, and to have a unified agendaand unified team stay in place longenough to accomplish them. Then to dothe same thing again and again.
Productivity is a powerful force. Wehave a wonderful company—a research
powerhouse and market leader with200,000 employees and worldwideoperations. We have tremendous reach,technology, and productivity.
Carrier Corp., a UTC company, willbuild 10 million units of product thisyear (up from 3 million units 12 yearsago on a work force 11 percent larger).Otis, another UTC company, will installthree times more elevators and main-tain twice as many as 12 years ago witha work force only 21 percent larger.Productivity is jumping at 5 to 7 per-cent per annum. Take out inflation, takeout price change, it’s raw, physical vol-ume productivity, units per person.And there’s no end in sight. This is thereason for the strength in our economy.
In 1992, our revenues were $19 bil-lion. They will be $50 billion in 2007.Our work force worldwide was 150,000people in 1992, and it’s 200,000 today.So 2.5 times the revenue with a workforce 25 percent larger. Our market cap-
Doing More with Less
IHAVE A SINGLE POINT TOmake: we can do
more with less. About90 percent of the energy coming out ofthe ground is lost or wasted before itbecomes useful work. Half of the inputenergy in central station power plantsgoes up the stack as waste heat becausewe can’t move heat effectively any dis-tance. But how about putting the gen-eration on-site and capturing andusing the waste heat there. We do thisroutinely, and energy conversion effi-ciencies go from 30 to 75 percent forgeneration and heat capture locally.
Another example is not recapturinginput energy into vehicles when they’rebraked and stopped. The net energy inthis acceleration-deceleration cycle iszero, adjusted only for system inefficien-cies and losses. New elevators recapturethe energy on descent that was expend-ed on ascent. We build Otis elevatorstoday that use 75 percent less electricenergy than comparable equipment inspeed and load did a decade ago. A re-generative commercial building high-rise elevator lifts a million pounds a dayat an energy cost of $1 an hour!
A third example is heat transferinstead of heat dissipation and genera-tion. Air conditioning systems moveheat from one place (inside) to anotherplace (outside). We measure efficiencyby Coefficient of Performance (COP)—theamount of energy required to moveanother amount of energy. The COP ofmost air conditioning systems is about4 times (one unit of input is needed tomove four units of energy or heat).How about heating hot water by heattransfer so energy can go down by 75percent! Paybacks for such systems arejust three years at current energy prices.
Massive energy conservation is fea-sible and comes with attractive finan-cial returns. The common denominatorof all we do is to convert energy to use-ful work. We build fuel-cell poweredbuses, because the by-products arewater, heat, and electricity. Fuel-cellbuses are twice as energy efficient asdiesel buses, have no emissions, nosmell, and very little noise.
The changes proposed here are
italization in 1992 was $6 billion; todayit’s $54 billion. Our operating marginhas gone from 5 to 14 percent.
Lean manufacturing, Japanese quali-ty methodologies, and big goals didthis. Lean manufacturing is processmapping and process re-engineering toconvert work that used to be serial orsequential to simultaneous work co-located in manufacturing cells. It ismanaging linearity or uniformity in themanufacturing process to take theunpredictability out of operations andeliminate the inventories, elapsed time,and waste. Japanese quality methodsreplace traditional end-of-line inspec-tion with process control at the point ofwork. They build the confidence ofemployees making products.
Our environmental gains at UTChave been great, thanks to big goals.Since 1992, our hazardous waste gener-ation in the U.S. has gone down by 84percent and chemical releases to air by86 percent. Lost workday incident ratewent from four to four-tenths.
This says that 10X can be done—again and again. Gains like this havegiven UTC shareholders total returnsapproaching 1,100 percent over a dozenyears (about 3X the returns for the DowJones Industrial Average and S&P 500).
Our lessons are clear and powerful:First, it’s clarity of organization andalignment among management onwhat we’re trying to accomplish. Wehave a solid management team, wework well together, and we agree aboutour directions and disciplines andknow how to make them work. Secondis big goals. Big goals get big results;without the goals, you won’t get theresults. Third are the methodologieslike lean and Japanese quality. All thiswithin a framework of shareholdervalue and commitments to citizenship.
The way to get past difficulties is tohave clear disciplines, set big goals andbe tough about making them happen.Productivity can jump in anything wedo, and productivity and globalizationare the engines for better lives. But theymust be tempered with responsiblepractices. Free trade, free investmentflows, and labor mobility are essentialto generating productivity andincomes. This equation works. The onlyrequirement on employees is their will-ingness to rise to the challenges of mak-ing themselves better every day. Ourworld is not about a race to the bot-tom—it’s a race to the top. LE
George David is Chairman and CEO of United TechnologiesCorp. Visit www.utc.com.
ACTION: Enhance your productivity.
by George David
L e a d e r s h i p E x c e l l e n c e 1 9
MANAGEMENT PRODUCTIVITY
I t ’ s f e a s i b l e a n d f i n a n c i a l l y r e w a r d i n g .
effective risk assessment methods. Putthe risk of innovation on the right per-son. Find and develop supporters.Anticipate objections and provide bothlogical replies and stories that createcontexts for ideas. Test on a small scaleand create prototypes. Dramatize ben-efits. Give people reasons to feel safe.Show you take seriously the safety ofsponsors, participants and other stake-holders by mitigating their risks.
3. Siloing. Organizations seek to sus-tain and protect themselves. That’swhy they create boundaries, assignresponsibilities, and put rules in place.No matter how artificial the divisionsand processes are, they are usuallydefended. Innovations tend to crossboundaries and create new categories.It’s not unusual to see competing
claims of ownership and disputesabout authority. Deals break downover who will run things and howprofits will be divided. So, innovationsare killed by groups that don’t see theirbenefits or get a “fair share” of benefits.Seek to understand their concerns tobetter manage the conflicts.
Questions to ask include: Do allstakeholders benefit? Do all know howthey will benefit? What are the missionstatements of affected organizations?What are their rules? Who are the deci-sion makers? How have innovationsbeen handled in the past?
Possible answers include: Includeall major stakeholders in the creationof the innovation and help ensure theyare fairly rewarded. Create clear valuepropositions for all stakeholders. Keepstakeholders aligned and informed.Understand the concerns, interests,and boundaries of different organiza-tions. Know the people involved.
Barriers to Innovation
WHETHER YOU’REtrying to lead
your industry, create anew market, or just do things moreefficiently, innovation is difficult.Success begins with knowing whatyou are trying to achieve, the likelyresistance, and planning. Still, fivebarriers repeatedly show up, but theydon’t need to stop your innovation:
1. Inadequate funding. Getting thefunds for an innovation often meanstaking money away from another pro-gram. Getting the money at just theright time is also hard, since annualfunding cycles don’t match well withreal-world opportunities. Many excel-lent innovations need more than seedmoney to survive. Broader thinkingon needs and resources can help inno-vators move their ideas along.
Questions to ask include: How farcan we get without money? Do weneed money? How much? When?What sources are there? Do we haveany partners? Who benefits and how?
Possible answers include: Use theresources of informal networks. Callin favors. Simplify the plan to createshort-term successes. Do a creativeinventory of available fund sources.Don’t build everything from scratch:leverage other work or take advan-tage of “good enough” substitutes.Enlist those who might realize valueas allies. Then sell them on the idea.
2. Risk avoidance. No progress ismade without calculated risk-taking.Since innovation is risky, many peoplehabitually look for things that couldgo wrong. Many classic responses(“We’ve never done this before” or“This failed when we tried it before”)come as a reflex. Once risks are identi-fied, innovation is often stopped. Buta clear-eyed view of risks balancedagainst benefits can create a culturewhere innovation is nurtured.
Questions to ask include: Do weuse standard methods for measuringrisks and benefits? Do we use appro-priate risk assessment measures? Dowe measure the risks of not innovat-ing? Do we measure the benefits?
Possible answers include: Promote
4. Time commitments. Time is scarce.One of management’s jobs is to verifythat minutes are productively filled.And while enlightened managementwill invest some of workers’ on-the-jobtime in education, experimentation,relationships, personal growth andhealth, it’s difficult to prove that suchinvestments pay off. But increasing thevalue and benefits of an innovationwill tend to free up time for work on it.
Questions to ask include: Is theinnovation worth the time of the peo-ple involved? What are the competingclaims on time? What is the minimumtime each participant must dedicate?What are the milestones? Where isthere flexibility in the schedule?
Possible answers include: Do triageon assignment lists. Let others do moreof the work. Reallocate benefits so theinnovation can compete better for thetime of key participants. Create smallsuccesses that encourage participantsto free up more time.
5. Incorrect measures. Many organi-zations only measure revenue, profits,and market share. These are easier toquantify than intangibles such as repu-tation, knowledge, attractiveness to tal-ent, leadership, and other assets thatcontribute true value. Most innova-tions are difficult to explain in terms ofROI. Even innovations that have thepotential to disrupt or create new mar-kets may suffer by comparison whenput up against more pedestrian pro-jects in a budgeting process. By includ-ing decision-makers in creating newmeasures, you avoid the ROI trap.
Questions to ask include: Can weexpand our measures of success orhave different measures for differentinvestments? Possible answers include:Assess the value of possible measures.Measures that are compelling to allstakeholders can be developed in jointworkshops. Enterprises that take aportfolio approach can establish differ-ent measures for different investments.
The most effective way to overcomebarriers is to discuss with colleagueshow they work through problems.Your most valuable asset for innova-tion is your network. Advice, com-plaints, mentoring, and “war stories”all strengthen relationships. Workingtogether to solve common problemsrevitalizes these networks. Working onbarriers with your network helps youto realize the potential of your idea. LE
Peter Andrews is an innovation strategist in IBM ExecutiveBusiness Institute. call (845) 732-6095, email [email protected][email protected] or visit ibm.com/sales/ebi.
ACTION: Overcome barriers to innovation.
by Peter Andrews
2 0 L e a d e r s h i p E x c e l l e n c e
CHANGE INNOVATION
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