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ExcellenceL E A D E R S H I P

THE MAGAZINE OF LEADERSHIP DEVELOPMENT, MANAGERIAL EFFECTIVENESS, AND ORGANIZATIONAL PRODUCTIVIT

WINTER 201

Leadership Excellence is an exceptionalway to learn and then apply the best andlatest ideas in the field of leadership.

WARREN BENNIS, AUTHOR AND

USC PROFESSOR OF MANAGEMENT

SmartNegotiations

(Part Three)by Robin L. Pinkley

SmartNegotiations

(Part Three)by Robin L. Pinkley

EmployeeRelations

by Zannie Giraud Vosand Glenn B. Vos

EmployeeRelations

by Zannie Giraud Vosand Glenn B. Vos

SMU Cox CollinsExecutive Education Center


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Radically change your

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SMU will not discriminate on the basis of race, color, religion, national origin, sex, age, disability, or veteran status. SMUs commitment

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exed.cox.smu.edu/excellence or call 214.768.3335

ACCOUNTING AND FINANCE

Essentials of Finance and Accounting

for Non-Financial Managers

April 26 -28, 2011

NEGOTIATION

A Gain-Gain Approach to Profitable

Negotiation

April 27 A pril 28, 2011

STRATEGY

Formulating and Implementing

Effective Business Strategy

April 18 April 19, 2011

LEADERSHIP & MANAGEMENT

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ExcellenceL E A D E R S H I P

THE MAGAZINE OF LEADERSHIP DEVELOPMENT, MANAGERIAL EFFECTIVENESS, AND ORGANIZATIONAL PRODUCTIVITY

GARY HAMEL

Extreme MakeoverStart your revolution inmanagement innovation. . 3

TOM PETERS

What Matters?What will you rememberand be remembered for?. .4

MARCUS BUCKINGHAM

Strong LeadershipLive and lead from yourunique strengths . . . . . . . 5

SALLY HELGESEN

Dance of PowerMore women are nowtaking the lead. . . . . . . . . .6

DONALD SANDEL

Leading PeopleIt is not the same asdriving them. . . . . . . . . . . .7

JIM COLLINS

Enduring GreatnessGet the right leadersin the right positions. . . . .8

RICHARD DAFT

Your Inner CEOTake control now ofyour inner elephant. . . . . . 9

TERRY R. BACON

Power and InfluenceInfluence people to followyour leadership. . . . . . . . 10

JOSEPH S. NYE, JR.

Contextual IntelligenceIt engenders moreeffective leadership. . . . . .11

MUHTAR KENT

Women PowerYou wont get where youwant to go without it. . . 12

SHARON ALLEN

Visible HandsModel ethical leadership. .13

ROBIN L. PINKLEY

Smart NegotiationsIncrease in efficiencyand effectiveness. . . . . . .14

LANCE BERGER ANDDOROTHY BERGER

Talent Management

You need a winning creed,strategy, and system. . . . 14

ZANNIE GIRAUD VOSSAND GLENN VOSS

Employee RelationsFind the right mixfor your culture. . . . . . . .15

PETER BLOCK

Enterprising EconomyCommunity is key. . . . . .16

ANN RHOADES

Built on ValuesBase culture on thebehavior of A players . . .17

ROLAND DEISER

Creative LeadershipThese are prizedperforming artists . . . . . .18

WORLD BUSINESS FORUM

Jim Collins: Great Results. .19David Gergen:Role of Leader. .19Jack Welch: Achieving andSustaining Success. . . . . . .20Carlos Brito: Building aPerformance Culture. . . . . . .20Joseph Grenny: Executeon Your Strategy . . . . . . . . .20Al Gore: New Global Deal. . 21A.G. Lafley: Gain Customer-Centric Growth. . . . . . . . . . 21Renee Mauborgne: BlueOcean Srategy. . . . . . . . . . . 22James Cameron: Innovation. .22

VOL. 28 NO. 1 SMU COX SCHOOL OF BUSINES S E DITION WINTER 2011

Lucky Catch

In natural environments, the hunt for foodto sustain lifeand limboften consumes much of the day. In an Alaskan

stream where miners once discovered gold, two hungry

wolves try their luck at fishing for trout. Great leaders may

not strike gold, but they sustain the precious pack.


4/26

HAVE YOU HEARD OF VUCA(Volatile, Uncertain, Com-plex, and Ambiguous). I learned

this acronym from the Economist IntelligenceUnit. To many economists, VUCA perfectlycaptures the global economic outlook. How-ever, VUCA also suggests that no one can con-fidently predict how the economy will perform inthe foreseeable future. As humorist Will Rogerssaid of the Great Depression in the 1930s: Idont know any more about this than an economist!

Leaders appear to be as uncertain as

economists in responding to a VUCA world.A national CFO survey conducted by Deloitteidentified strategic ambiguity, changing regula-tory requirements, and major changeinitiatives as their top job stresses.Performance pressures came in a dis-tant fourth. While 46 percent ofthe CFOs reported that they arefocused on revenue growth in thenear term, optimism and forecast-ed operating results were highlyvariable. They identified the econo-my as the one potentially high-impactrisk area that worries them most.

Locally, the annual SMU CoxCEO Sentiment Survey reports that leaderscontinued to feel negative impact of the recessionin 2010. In 2010, 44 percent of CEOs sawimprovement in the economy, but 34 percentexperienced a decline. In the coming year,fewer CEOs than last year expect the local,national or global economies to improve.The outlook for individual businesses ismixed with many expecting both revenuesand costs to increase, squeezing profits.However, this is highly variable with 44 per-cent of respondents expecting capital expen-ditures and wages to remain flat but 34

percent expecting them to increase, and 48percent foresee staffing levels to remain flatwith 32 percent projecting an increase.

What are Chief Learning Officers sayingabout their plans for investing in humancapital?One survey conducted in spring2010 indicated that about as many firmsplanned to increase spending on training asplanned to decrease it. More recently, CLOmagazines Business Intelligence Boardfound more CLOs expecting an increase inbudgets than in 2010, but the increases areexpected to be small (4 percent), and about

three quarters of the respondents expect

these modest increases or no change.The national results for CLOs follow those

SMU found locally among HR leaders andtrainers. Over 98 percent were evenly spliton projecting no change or modest increases (lessthan 20 percent) in spending on manage-ment training. This is on top of two years ofmore than 10 percent decreases. Thus, eventhose who are projecting increased spendingwont return to pre-recession levels in 2011.

Most learning and development profes-sionals agree on how to focus their limitedinvestment in human capital. Over two-thirdsof local HR leaders who project increased

spending intend to focus it on their highpotentials. However, they expect to do mostmanagement development in-house, using

external providers for outsideexpertise and third-party view-points rather than to achieveeconomies through outsourcingor flexible staffing. Not surpris-ingly, then, leadership is by farthe most important content areafollowed by topics that reflectthe need for focus and efficiency.

The four areas where CLOssay spending will have the most

impact are: leadership and execu-tive development, compliance, businessskills, and career development, includingindustry and job or role specific skills. Ofcourse, many CLOs expect to invest in tech-nology infrastructure, including learningand content management systems, contentauthoring and virtual classrooms, mobileand portal technologies. The share of learn-ing budgets devoted to technology isexpected to increase from about 19 percentin 2010 to only 20 percent in 2011.

In a VUCA world, leaders are rightly cau-tious about investing in growth. Prudence

dictates that they hoard cash and reduce debt.However, VUCA demands that managementdevelopment leaders manage their human capitalinvestment portfolios to prepare a deep pool offlexible and adaptive leaders and to developcapability in business acumen, strategicthinking, organizational and interpersonalskills. Sound investments in these areas willcreate the maximum benefit from limited re-sources and enable them to respond to aVUCAworld and do more with less. LE

Frank Lloyd, Ph.D., is Associate Dean of Executive Education atSMU Cox School of Business. Visit www.SMU.edu.

W e l c o m e t o t h e w o r l d o f V U C A .

by Frank Lloyd

Volume 28 Issue 1

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Leadership UncertaintyE . D . I . T . O . R S N . O . T . E

2 W i n t e r 2 0 1 1 L e a d e r s h i p E x c e l l e n c e

UPCOMING LEADERSHIP

AND MANAGEMENTCERTIFICATEPROGRAMS

CERTIFICATE PROGRAM INMANAGEMENT

Plano CampusFebruary 9 April 27, 2011

CERTIFICATE PROGRAM INLEADERSHIP

Dallas CampusFebruary 8 April 26, 2011
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5/26

most experts would regard as a quixot-ichow can you create a companythat feels more like a community than

a bureaucracy and operates more likea democracy than a hierarchy?

The world has become too complexfor the CEO to play the role ofvision-ary-in-chief, argues Veneet. Instead, theCEO must become a management archi-tectsomeone who continually asks,What are the principles and processes thatcan help us surface the best ideas andunleash the talents of everyone who workshere? Today, as never before, the worldneeds leaders who refuse to be seducedby the fatal allure of the familiar.

SS iixx MMaa jjoorr IInnnnoovvaa tt iioonnssVineet and his team pursued the

path of management innovation onecraggy step and jagged handhold at atime, making six key changes:

1. Transparent financial data. Vineetrealized its hard to feel empowered ifyour manager has data you dont. So,HCLTs IT team enabled every employeeto have a detailed set of financial met-rics for their team and all teams. Sudden-ly, poorly performing teams had incent-ive to improve, and high-performingones to stay on top. And, employeesnow had positive proof that the com-pany trusted them with strategic infor-mation.Need to know became right to know.

2. Open and honest feedback. Vineetand his leadership team set up an onlineforum and encouraged employees to asktough questions and offer honest feed-back. Nothing was censored; everypost, however virulent, was displayed.While some managers bemoaned thefact that the companys soiled laundrywas now online, employees lauded theforum as a symbol of HCLTs commit-ment to transparency and as anotherway to hold top management account-able. The U&Iportal also served as an

Extreme Makeover

MANY OF THE TOOLSand methods we

use to manage peopleare ill-suited to the challenges in todayscreative economy. Often, legacy manage-ment practices reflexively perpetuatethe pastby over-weighting the viewsof long-tenured executives, by valuingconformance over creativity, and by turn-ing tired nostrums into sacred truths.

We all know there are downsides tomanagement-as-usual, but are there anygood alternatives? We can dream aboutorganizations where employees challenge

their bosses, where honesty trumps defer-ence, and where the pyramid is turnedupside downlike we can dream aboutworld peace and cold fusion. But thatdoesnt mean theyre achievable.

Skepticism is understandable. Afterall, the technology of management varieslittle from firm to firm. Hence, its easyto assume that the management statusquo is also status optimusthat whilethere may be other ways of managingand leading, there are no better ways.

Before accepting this premise, weshould remind ourselves that dogma

often masquerades as truth, and that weare often comforted by the deception. Manyleaders would prefer a lazy ramblealong gentle contours of the tried-and-true than a hard scramble up the rockyincline of the untested and unproven.

Vineet Nayar, CEO of HCL Technol-ogies since 2005, however, is a scram-blerone who has fomented a ferventrevolution in management practices.

I first met Vineet in 2008, when heparticipated in a conference Id orga-nized in California. Half a minute intoour first conversation, he said: We tell

our employees, You are more impor-tant than your manager. Value getscreated between the employee and thecustomer, and managements job is toenable innovation at that interface.

Vineets fervor was palpableanda little weird. Revolutions dont usuallystart with the monarchy. I wondered,was he backing up his revolutionaryrhetoric with action? As I dug deeper,I discovered that he is. In his illuminat-ing bookEmployees First, CustomersSecond, he chronicles a journey that

early warning system for critical issues.Later, Vineet opened up a My Problemssection where he solicited advice onthe big thorny issues he wrestled with.

3. Service level agreements. WhenVineet asked front-liners, What havethe enabling functions, like HR andfinance, done to help you create valuein the value zone? he was often metwith silence. The solution: a web-basedSmart Service Desk where any employee

could open a service ticket if they had acomplaint with a staff group. Onceopened, the ticket could only be closedby the concerned employee, once theirissue had been resolved. Staff functionswere charged with dealing with opentickets within 24 hours, or the ticketgets escalated up the line. This systemmade staff departments more account-able to those in the value zone; leveledthe playing field for employees, astheir concerns now get handled quick-ly and efficiently; and generated dataused to improve internal policies.

4. Open evaluations. HCLT employ-ees rate (anonymously) the performanceofany manager whose decisions impacttheir work. These ratings are publishedonline. This visibility challenges man-agers to be more responsive and to ex-ercise their authority judiciously. Thenumber and scope of reviews receivedare indicators of managers zone of in-fluence. This feedforward process is notconnected to compensation and pro-motion decisionsit is purely devel-opmentalbut there are few hidingplaces left for mediocre managers.

5. MyBlueprint. As the CEO, Vineetwas asked to weigh in on hundreds ofunit-level plans each year. Recognizingthe limits to his time and expertise, hechallenged colleagues to develop anonline, peer-based evaluation process.The solution: MyBlueprint. Last year,300 managers posted their businessplans or blueprints online. More than8,000 employees reviewed the plans.The result was a torrent of advice andcounsel, highlighting chances forcross-unit collaboration and helpingleaders to learn from interested peers.

6. Employee first councils. The goalhere was to help employees connect withteam members who shared similar inter-ests and passions. Supported by a web-based platform, this initiative rapidlyspawned communities around cultur-al, recreational, and job-related issues.Each Council elected its own leader.Vineets team also launched 32 issue-specific councils that quickly became avital source ofnew ideas and strategicinsights. These are then transferred to adedicated group to execute (now 20 per-

by Gary Hamel

L e a d e r s h i p E x c e l l e n c e W i n t e r 2 0 1 1 3

MANAGEMENT INNOVATION

E n g a g e i n m a n a g e m e n t i n n o v a t i o n .


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cent of HCLTs revenue comes from them).The notion ofreverse accountability is

now rooted within HCLT. Theres stilla hierarchy, but its role is diminished.Says Vineet, At HCLT, we are tryingto democratize our company.

Vineet Nayar and his team had theguts to commit HCL to a goalreverseaccountabilitythat was both excruciat-ingly difficult and eminently worthwhile.

TTaakkee BBoo lldd IInnnnoovvaattiioonn iinn SS ttaaggeessHCLT proves that it is possible to

change management DNA withoutblowing up the existing managementsystem, without having a detailed mas-ter plan at the outset, and without tak-ing inordinate risks. If youre a would-be management renegadethis meansthat youve just run out of excuses.

Bold innovation is usually a multi-year,multi-staged processfor three reasons:

1. In established firms, its impossi-ble to start from scratch and hazardousto move too quickly. Innovators rarely

have a clean sheet of paperand mustensure that the business keeps runningwhile testing new practices. So, thetransformation at HCLT is still a work inprogress; but, if a $2.5 billion companycan invert the pyramid and live to tellabout it, we must admit: there are alter-natives to the management status quo.

2. Radically-minded managementinnovators dont have the benefit of aroadmap. To do a six-sigma rollout,you can buy a manual; but to invertthe pyramid, youll have to venture offthe well-trod path of management

orthodoxy, tramp through unexploredterrain, and occasionally get stuck inthe mudit often takes several itera-tions before a bold, new policy initia-tive produces the hoped-for results.

3. Were talking about people, notwidgets. On any given day, some of uswill be selfish, grumpy, egotistical, ormendaciousand a few people aremost of these things most of the time.Yes, therell always be jerks, but in anorganization committed to becomingmore transparent and less hierarchical,there are fewer of them over time.

So, while an extreme managementmakeover is possible, it cant be doneovernight or without setbacks. The newdoesnt instantly or magically supplantthe old. Even after years of diligenteffort, vestiges of the old, legacy model(overbearing bosses, under-loved employees,and petty turf wars) will remain. But overtime, these become the exceptions. LE

Gary Hamel is a Fellow of the World Economic Forum and theStrategic Management Society and the author ofThe Future ofManagement. Visit www.garyhamel.com.

ACTION: Innovate your management practices.

by Tom Peters

to avoid compromising your and yourteams character and integrity. A sense of time honorably spent. Expressions of simple human kind-

ness and considerationno matterhow harried you may have been. Knowing that your demeanor and

expression of character always set thetoneespecially in difficult situations. Rarely letting your expression of

enthusiasm/determination flagthe

rougher the times, the more your ex-pressed energy, optimism, and humor. The earned respect of your peers. A stoic unwillingness to badmouth

otherseven in private. An invariant creed: When something

goes amiss, the buck stops with me; whensomething goes right, it was your doing. A nave belief that others will rise to

the occasion if given the opportunity. Eschewing trappings of power

(strong self-management of tendenciestoward arrogance or dismissiveness).Intensity, even driven, but not to the

point of being careless of others. Willingness to be surprised by ways

of doing things that are inconsistentwith your certain hypotheses. Humility in the face of others, at

every level, who know morethan you about the waythings really are. Biting your tongue on a

thousand occasionsandreally listeningand beingdelighted when you learnsomething new. Unalloyed pleasure in be-

ing informed ofthe fallacious-ness of your beliefs by a per-son 15 years your junior.

Selflessnessa reputation as a per-son who helps out despite personal cost. Having been as thoughtful and

respectful, or more so, toward enemiesas toward friends and supporters. Always being first of service to your

internal and external constituents (em-ployees, customers, vendors, community.) Treating servant leadership as holy

writ (and preaching SL to others). Creating the sort of workplace

youd like your kids to inhabit. Being a certifiable nut about quality,

safety, integrity, regardless of costs. Resigning a few times rather than

compromise your bedrock beliefs. Seeking perfection just short of the

paralyzing variety. A self- and group-enforced standard

ofExcellence-in-all-we-do and Excellencein our behavior toward one another. LETom Peters is the best-selling author ofThe Little BIG Things.Email [email protected] or visit www.tompeters.com.

ACTION: Start making your leadership memories.

AT AGE 68, ALTHOUGH I

try to be forward-focused, I have a frequent

urge to sum things up. As I look back, Ifind that certain memories stand out. Iknow my own storyand have talkedto many others. When you look back atwhat really mattersits rarely the num-bers. Yes, you must be profitable to sur-vive. Still, my summing up statement ismore about the basics of human behaviorand character than about the angle ofincline of a market share graph.

What follows then is my attempt toidentify the memories that matteror

will matterfor you as a leader: People you developed who went on

to stellar accomplishments. Two or three people you developed

who created stellar firms of their own. The long shots you bet

on who surprised them-selvesand your peers. The people who later

say, You made a differencein my lifeyour belief inme changed everything. The sort of/character of

people you hired (and bad

apples you chucked outdespite some stellar traits.) A few projects you dogged-

ly pursued that still make you smile andchanged the way things are done insideor outside the company or industry. The supercharged camaraderie of a

great team aiming to change the world. Belly laughs at some of the stupid-

insane things you and your mates tried. A consistent record of having

invariably said, Go for it! Not intervening in the face of loss

knowing that developing talent means

tolerating failures and allowing peopleto work out of their self-created mess. Dealing with one or more crises

with particular/memorable aplomb. Demanding/demonstrating civility,

regardless of circumstances. Turning around dreadful situations

and watching people rise to the occa-sion and acquire a new sense of purpose. Leaving something of lasting worth. Having almost always put quality

and excellence ahead ofquantity. Times when you did the right thing

What Matters?Start making memories.

LEADERSHIP MEMORIES

http://www.garyhamel.com/mailto:[email protected]://www.tompeters.com/http://www.tompeters.com/mailto:[email protected]://www.garyhamel.com/


7/26

catch the moments that invigorate you,and cradle themconcentrate on them,celebrate them, look at them from new

angles, follow where they lead, andyoull make the right decisions for you.

The challenge of life and leadershipis not to jugglethe challenge is to catch:to select a few clear, strong momentsfrom each aspect of your life, reach forthose, and draw them in to you.

To live a more fulfilling life, you needto identify the specific moments (in eachpart of your life) that renew your ener-gy and bring you joy, and go after them.You want to imbalance your life towardcreating more of those moments. Youcant do everything, so dont fall into

the trap of trying. Instead, find themoments in each aspect of your lifethat invigorate you, and imbalance yourlife toward those things.

IIttss AAbboouu tt RReessuu llttssThe truth is, people are not your great-

est assetunless theyre in position toleverage their greatest strengths, thosethings they do well consistently andenergetically.

Individuals and teams playing totheir strengths outperform those whodont in every business metric. In fact,the single best predictor of a consis-tently high-performing team is the

answer to this question: At work, doyou have the opportunity to do what youdo best everyday? Teams with individu-als who do massively outperform teamswith people who dontthey are moreprofitable, more productive, less likelyto quit, less likely to have accidents onthe jobthe list goes onand yet only12 percent of people play to theirstrengths at work most of the time!

Have we forgotten what PeterDrucker wrote some 50 years ago: TheEffective Executive builds on strengths

Strong Leadership

SINCE USING YOURstrengths makes

you feel strong, payclose attention to how you feel as youcomplete your day-to-day tasks.When you notice yourself at work (orat play), you find that you experiencestrong-momentstimes when you feelinvigorated, inquisitive, or successful.Those moments are clues to your per-sonal strengths.

To help you recognize the signs ofstrength, heres a simple acronym SIGN:SSuccess: Do you feel a sense of accom-

plishment about finishing this task?IInstinct: Do you instinctively lookforward to performing this task? GGrowth: Are your synapses firing? Areyou mentally focused? NNeeds: Doesthis task fulfill one of your needs?

If you feel these feelings whiledoing a task, then that activity is like-ly one of your strengths.

As a leader, you need to discoveryour strengths and then do more ofwhat most invigorates you and whatyou do best. You can attain high satis-faction in your life and leadership

when you figure out what strengthensyouand then make decisions thatenable you to play to your strengthsinstead of worrying about things thatweaken you. In fact, you can pushyour current job, no matter what it is,in the direction of your dream job.The more you use your strengths, themore satisfying your job will be.

Many people feel the need to bewell-rounded in their life and theirleadership. Performance reviews oftenconsist of a brief pat on the back forareas that are working well and then a

substantial focus on areas of oppor-tunity. The problem with focusing onwhat doesnt work is that attentionamplifies everything. If you focus on theproblem with the intent of fixing it,despite your best intentions, thatproblem is magnified. Instead, shiftyour focus and ask, Whats workingwell, and how can I get more of that?

You are innately wise. When youmake poor decisions, you havent lis-tened to your intuitions or yearningsenough. Listen to yourself carefully,

their own strengths, the strengths ofsuperiors, colleagues, subordinates;and on the strengths of the situation.

As leaders try to do more withfewer people, they need to engageeach persons strengths, and do it atscale across the organization. Thestrengths movement isnt about mak-ing people happierits about makingorganizations more productive. Thebest companies are made up of great

teams. And those teams have individ-uals who know their strengths, takethem seriously, and offer them up tothe organization.

WWhhaatt SSeettss GGrreeaatt CCoommppaann iieess AAppaarrtt??Every company is made up of sepa-

rate teams, and the performance ofthose teams, no matter how successfulthe company may be, varies widely.And for the individual employees, theexperience of the team trumps theexperience of the company. What then,determines the experience of the indi-

vidual? Often its their managers andleaders. As we often hear: People joincompanies, and quit managers.

Managers and leaders play a signif-icant role in creating a culture whereinindividuals can thrive, discover theirtalents and have an opportunity to usetheir best selves daily. Great leadersand managers help people to identifyand leverage their unique strengthsmost of the time.

Again, the opportunity for individ-uals to play to their strengths most of thetime is the key factor that shows the

greatest correlation to outstanding per-formance in the widest range of busi-ness outcomes, including profits,productivity, customer satisfaction,and safety and employee retention.

Teams whose members play to theirstrengths most of the time are: 50 per-cent more likely to have loweremployee turnover; 38 percent morelikely to work on high-productivityteams; and 44 percent more likely toearn higher customer satisfactionscores. And yet, again, fewer than 20percent of people say that they do.

Worse, fewer than 25 percent say thattheir manager even discusses theirstrengths in performance reviews.

Strong managers and leaders identi-fy and leverage their own strengthsand then create a fully engagedstrengths-based team. LE

Marcus Buckingham is founder of TMBC, a managementconsulting company, leadership expert, speaker andbestselling author ofFirst, Break All the Rules; NowDiscover Your Strengths and Find Your Strongest Life.Visit www.TMBC.com.

ACTION: Discover and play to your strengths.

by Marcus Buckingham


LEADERSHIP STRENGTHS

L i v e a n d l e a d f r o m s t r e n g t h s .
http://www.tmbc.com/http://www.tmbc.com/


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body problem, for without the focus onsports, how can leadership be embodied?Its an important question, since mani-

festing a leadership presence (and exert-ing physical influence) is essential.

Strozzi addressed the gap by devel-oping a physical yet non-athletic programof leadership training suited to an erain which the definition ofwhat a leaderlooks like is evolving. His methods arealso apt for cultures of networks andteams. In top-down organizations, lead-ers can exert power by virtue of posi-tion; in decentralized networks, peoplewont follow unless they buy into whatis proposed. Hence, the emphasis onwalking the talk also suggests that a

leaders principles must be embodied. Lieutenant Colonel Fred Krawchuk,

operations commander for the U.S.Army in the Pacific, notes: In the mili-

tary, as in business, we place too muchvalue on being action-oriented. Wethinkleaders are the guys who say,Lets just get it done. But that short-changes thoughtfulness and reflection.How do we merge these qualities? Wedevelop awareness. If we can be fullypresent with other people and ground-ed in ourselves, we can integrate obser-vation with our capacity to act. Nancy Hutson, who retired from

Pfizer as senior VP for global R&D,

sounds a similar note: Working withbody, language, and mood helps us bemore aware of ourselves, more attunedto others, as we build trust (not justassume it). Richards emphasis on prac-ticing leadership rather than being aleader also subverts the hierarchy, sincebeing a leader is all about position.

Web technologies, shifting demo-graphics, and deregulated global mar-kets requires leaders who are comfort-able being at the center rather than beingat the top, exercising intuitive and col-

Dance of Power

IS LEADERSHIP AN ART ORscience? Are women

fit for top leadershiproles? These questions have long beendebated. Your answers likely deter-mine whether you believe leadershipcapability can be developed and whoyou think is best suited to lead.

Richard Strozzi-Heckler has built adistinctive career based on the propo-sition that leadership is neither art norscience, but rather a practice that canbe developed. Aleader can build fluencyand muscle through the regular exercise

of disciplines that require physical andmental effort. People change throughpractice, he says. You can be smart,but if you just talk about something,you never learn to do it. Practicerequires being systematic, performinga sequence of movements over andover until it becomes part of yourphysical being, part of who you are.

Strozzi shows how wisdom can bemade manifest through movement.Drawing on a lifetime study of martialarts and Eastern philosophy; decadesof training in competitive sports; and

stints as a marine, soldier, firefighter,psychologist, and professor, Strozzihas created an eclectic but disciplinedand replicable program for helpingleaders develop the physical presence,fine-tuned awareness, bias for action,and precise articulation of purposethat inspire confidence and trust.

In the Western tradition, the physicalcomponent of leadership has been identi-fied with athletic prowess. Athletics havebeen viewed as a vehicle for buildingcharacter, instilling self-discipline, orimparting the habits of command that

come from captaining a team. Hence,we often assume that athletic excellenceauto-translates into skilled leadership.

But the equation between sports andleadership, and the metaphors it hasinspired, seem outdated and culture-specific in todays diverse global orga-nizations. Changing demographicsand technologies have made competi-tive sports less relevant and inspired abacklash that finds one expression inthe exaltation of the nerd.

This leaves leadership with a mind-

laborative skills and making their wordsconsistent with their actions. Womenhave an advantage in a world that val-ues authenticity over positional power.The ability to lead effectively derivesfrom self-knowledge. To quote SunTzu: Knowing the other and knowing one-self, in one hundred battles no danger. Notknowing the other and knowing oneself,one victory for one loss. Not knowing theother and not knowing oneself, in every

battle certain defeat.

WWoommeenn LLeeaadd tthhee DDaanncceeWomen are particularly well suited

to the new dance of leadershipand yetmany stumble as leaders. Zoe Cruz andSallie Krawcheck were the most power-ful women on Wall Street. It was specu-lated that both would become CEOs oftheir powerhousesMorgan Stanleyand Citigroup. Instead, Ms. Cruz wasousted and Ms. Krawcheck demoted,leading to hand-wringing about howwomen seem be losing ground as leaders.

Having studied female leadershipfor two decades, this women flounder asleaders narrative has a familiar ring.While the progress women have madeas leaders has not been rapid orsmooth, the impact women are having onwhat we perceive to be desirable in ourleaders continues to grow. The real storyis about influence (not numbers).Women are comfortable with directcommunication, relationship-building,diversity, and emotional intelligenceskills best suited for leaders today.

I prefer to focus on what women have

to contribute, rather than how they needto change or adapt. For decades, womenwere urged to conform to a masculineleadership styleto start using footballmetaphors in meetings, take up golf,and pull rank on subordinates in orderto keep them in line. Leave your values athome and play the game was the message.This conventional wisdom was basedon three assumptions: 1) organizationswouldnt change simply because womenhad entered them in massive numbers;2) changes wrought by networked tech-nologies wouldnt change organization-

al structures or reshape peoples expect-ations of their leaders; and 3) womenshandicaps as leaders would outweighwhatever advantages they might confer.

I saw these assumptions as false. Asorganizations undergo rapid changesas demographics, technology, and eco-nomics of work shift, women face a his-toric opportunity to influence if they willhonor and develop their distinctive strengths.

In my research, I find that talentedand confident women leaders have sevencharacteristics in common: 1) they place

by Sally Helgesen


LEADERSHIP DANCE

W o m e n a r e t a k i n g t h e l e a d .


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that we forget: we should be leading.And by creating an unhappy workforce,things turn from bad to worse. Clearly,those who ignore this fact do so at theirperil. When the economy improves andjobs are plentiful, people will remem-ber how their leaders behaved. Smartleaders care for their employees duringdifficult times, take advantage of thetalent supply that exists, and raid com-petitors for disengaged superstars.

Some 50 years ago McGregor posit-ed his theory about X and Y leaders: Theory Xleaders assume that most

people dislike work, lack ambition, anddesire no responsibility and account-ability. Leaders who see their employ-ees in this counter-productive way havedisengaged workers and low retentionrates and struggle to motivate staff. Theory Yleaders assume that people

tend to be ambitious, self-motivated,and not only accept responsibility butseek it. Managers with this view knowthat satisfaction comes from doing a

good job and that employees are large-ly self-directed and thrive in autonomy.

Daniel Pink notes: Today economicaccomplishment, not to mention per-sonal fulfillment, depends not on keep-

ing our nature submergedbut on allowing it to sur-face. It requires resistingthe temptation to controlpeopleand doing all wecan to reawaken theirdeep-seated sense of per-sonal autonomy.

Service, innovation, and

excellence emerge from arelationship of trust betweenemployee and manager.

And this seldom happens by accident.You may have a finance or operationsstrategy, but the ultimate value propo-sition is an executed people strategy.

My advice: Hire well. Set clear expec-tations. Look for teachable moments.And then get out of the way. Our great-est accomplishments, inventions, andinnovations come from the innate desireto do so, not to satisfy a corporate goalor a superiors demand. Order me to

create and Ill get something done;allow me to create and I will amaze.

I am not big on the dignity of officestuff, writes Tony Blair, in his mem-oirs; I rested my authority on motivat-ing and persuading people, not onfrightening them. What is requiredfrom leaders is the courage to let go, totrust, and then to be amazed. LE

Donald Sandel is a leadership consultant, speaker, and author.Email [email protected] or call 847-392-5114.

ACTION: Lead your people to victory.

ACLASSIC STORY FROM

the early days of theAmerican Revolution

occurred at the Battle of Bunker Hill.Two great American soldiers, GeneralIsrael Putnam and Colonel WilliamPrescott, had both led and fought gal-lantly. It was an epic struggle of strategy,courage, and grace under fire. Thoughthe Americans gave up ground, it wasseen as a victory, as they inflicted seriousdamage upon the worlds greatest mili-tary force, and raised American hopes.

As Prescott was leaving the field, heapproached Putnam, and asked him

why he had not given his flank moresupport with his men. I could notdrive the dogs, Putnam answered. Towhich Prescott said, If you could notdrive them, you might have led them.

Thats a valid response toall leaders. We cant aspireto victory by driving ourpeople. Organizations arebricks and mortar, spread-sheets and policies, andcant accomplish anythingwithout their people. Lead-ers who focus on the orga-

nization, and forget aboutpeople are not leading at all(theres a big difference be-tween driving dogs and leading people).

Some leaders blame the economyfor their not focusing on people: Wevejust got to make the numbers. But focus-ing on people is not a response only togood times, but a strategic approachthat understands that it is through ourpeople that work gets done, that mar-ket differentiation occurs, and that cus-tomers return. As Kerry Killinger, CEOof Washington Mutual, stated: Great

leaders know that they cant just meetshort-term earnings expectations andmanage the bottom line: They must cre-ate a great environment for their people.

Many smart leaders miss this corre-lation between people and earnings, en-gagement and customer satisfaction: If youhelp make me a happy employee, I will takebetter care of customers and put discretion-ary effort back into the organization. En-gaging employees and showing themthat you care need not break the bank.

Some of us today are so busy driving

Leading PeopleIts different than driving them.

by Donald Sandel

LEADERSHIP PEOPLEa high value on relationships and judgethe success of their organizations basedon the quality of relationships withinthem; 2) they prefer direct communica-tion; 3) they are comfortable withdiversity, having been outsiders them-selves and knowing what kind of valuefresh eyes could bring; 4) they areunwilling (and unable) to compart-mentalize their lives and so draw uponpersonal experience to bring private-

sphere information and insights totheir jobs; 5) they are skeptical of hier-archies and surprisingly disdainful ofthe perks and privileges that distin-guish hierarchical leaders and establishtheir place in the pecking order; 6) theypreferred leading from the centerrather than the top and structure theirorganizations to reflect this; and 7) theyask big-picture questions about thework they do and its value.

Such skills and strengths of womenleaders are now highly desirable. Net-worked technologies, the knowledge

economy and demographics of global-ization all support the skills, talents,and presumptions that women bring.

Twenty years ago, relationship-building was considered a soft skillthat a leader, who had to be tough,could not afford. Now, as leaders seek toconnect more directly with customers andstakeholders and motivate employees, anability to nurture strong relationships isessential. Technology today facilitatesand demands direct communicationwhile undermining hierarchy, a plusfor those who enjoy leading from the

center rather than the top. And in aglobal economy, comfort with diversityhas become essential. As work andhome become harder to separate, com-partmentalizing becomes a liability.

Also, the tough-guy approach toleadership is in disrepute these days, astyrants and bullies are brought in forcensure. Organizations today feel com-pelled to state how they value relation-ships and support diversity. Leaderscompete to take a greener, more holisticapproachemphasizing sustainabilityand contribution and acknowledging

the need to nurture the human spirit.Inclusive has become a buzzword, andweblike a description of how things work.

As more women are reaching posi-tions of authority and influence, theyare having a profound impact on howorganizations are led and on whatleadership qualities are valued. LE

Sally Helgesen is a speaker, advisor, and author of five books,including The Female Vision: Womens Real Power at Work,The Female Advantage and The Web of Inclusion. Visitwww.sallyhelgesen.com.

ACTION: Enable more women to lead the dance.

mailto:[email protected]://www.sallyhelgesen.com/http://www.sallyhelgesen.com/mailto:[email protected]


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walls and thereby endure for decades,perhaps centuries. Yes, all products,services, markets, and even specificsolutions to social problems eventually

become obsolete. But that does notmean that the organizations that pro-duce them must become obsolete.

When youve built an institutionwith values and a purpose beyond justmaking moneywhen youve built aculture that makes a distinctive contri-bution while delivering exceptionalresultswhy would you capitulate tothe forces of mediocrity and succumbto irrelevance? And whywould you give up on theidea that you can createsomething that not only

lasts but deserves to last?The best leaders never pointout the window to blameexternal conditions; theylook in the mirror and say,We are responsible for ourresults! Those who takepersonal credit for goodtimes but blame external events in badtimes simply do not deserve to lead.No law of nature dictates that a great insti-tution must inevitably fall. That most dofalland we cannot deny this factdoes not mean you have to be one of them.

CCee lleebbrriittiieess vvss.. LLeevvee ll 55 LLeeaaddeerrssThere is perhaps no more corrosive

trend to the health of our organizationsthan the rise of the celebrity CEO, therock-star leader whose deepest ambi-tion is self-centric. In contrast, everygood-to-great company has had aremarkable leader at the helm duringthe pivotal years. These Level 5 leadershave a paradoxical blend of traits: Theyre somewhat self-effacing indiv-

iduals who deflect adulation, yet whohave an almost stoic resolve to do what-

ever it takes to make the company great.They demonstrate unwavering resolve todo whatever must be done to producethe best long-term results, no matterhow difficult, yet act with quiet, calmdetermination and rely principally oninspired standardsnot an inspiringpersonalityto motivate. They channeltheir ego needs away from themselvesand into building a great company.They create superb results, yet demon-strate a compelling modesty, shunningpublic adulation and never boastful.

Enduring Greatness

MANY PEOPLE HAVEargued that its

time to give up on the ideaof building great companies that endure.One technology pundit cornered me ata conference and deemed the wholebuild to last premise absurd: We live inan era when nothing can be built to last.Everything is in flux; nothing can be sus-tained. He invoked Joseph Schumpeter,the great economist who wrote aboutthe perennial gale of creative destruc-tion wherein technological change andvisionary entrepreneurs give birth to

new things that obliterate old things,only to see those new things becomeobliterated by the next generation.

Ive been through versions of thecreative-destruction argument dozensof times, with smart people. And oneof their favorite arguments invokes theFortune 500: If you examine the listover time, you find tremendous churn.

But if we look through another lens,we can see a different story, a story ofwell-founded hopeeven clear exam-ples of enduring greatness. We also findcompanies that overcame oppressive

mediocrity or worse to achieve sustain-ed success. We also find companies thatfell from greatness, but then regainedtheir footing, standing defiant againstthe forces of creative destruction.

Just because a company stumblesor gets smacked upside the head by anunexpected event or new challengedoes not mean that a company mustcontinue to decline. Companies do notfall primarily because of what theworld does to them or because of howthe world changes around them; theyfall first and foremost because of what

they do to themselves. Whether youprevail or fail, endure or die, dependsmore on what you do to yourself thanon what the world does to you.

Throughout history, the greatestcompanies have used adverse times totheir advantage. Just because JosephSchumpeters creative-destructionargument proves correct for most busi-nesses does not mean that the compa-nies that create those businesses mustfall and dieafter all, you can practicecreative destruction inside your own

They are incredibly ambitiousbuttheir ambition is first and foremost forthe institution and its greatness, not forthemselves. They are comfortable withthe idea that their companies will tickon without them, reaching even greaterheights. The fact that most people willnot know that the roots of that successtrace back to them is not an overridingconcern. They set the standard of build-ing an enduring great organization and

will settle for nothing less, yet channelambition into the organization and itswork, setting up successors for evengreater success in the next generation. They look in the mirror, not out the

window, to apportion responsibility forpoor results, never blaming other people,external factors, or bad luck; and yet theylook out the window, not in the mirror,to apportion credit for success of the

companyto other people,external factors, and good luck. They may earn a very

good living, but they dont

work for money. Making acompany great has little todo with how you compen-sate leaders and everythingto do with who you com-pensate. If you have theright people, theyll doeverything in their power

to make the company great, no matterhow difficult the decisions. Level 5 lead-ers are revolted by the idea of leavingunrealized potential on the table; theyare driven to create excellence for its ownsakenever satisfied because there is

always a higher standard to work toward.Leaders whose dedication goes up and downdepending on their incentive compensationare simply the wrong people for the job. Ifboards would stop lurching after high-profile, egocentric celebrities and turninstead to the disciplined, workmanlikeleaders who produce true greatnessover time, wed see better companies.

If we allow the celebrity model ofleadership to triumph, well see thedecline of organizations. Ifgood is theenemy of greatand I believe it isthecurrent trends in leadership give the

decided edge to the enemy. Still, I remainoptimistic. Smart people see the dangersof entrusting our future to self-serving lead-ers who use our institutions to advance theirown interests. Also, I am convinced thatthe seed of Level 5 leadership is widelydispersed. When it is identified, culti-vated, and encouraged, it can flourish.And if it does, so will our organizations. LE

Jim Collins is the best-selling author ofGood to Great: WhySome Companies Make the Leap . . . And Others Dont. Thisarticle abridged from his articles. Visit www.jimcollins.com.

ACTION: Get the right people in your pipeline.

by Jim Collins


LEADERSHIP GREATNESS

L o o k n o w f o r t h e r i g h t l e a d e r s .
http://www.jimcollins.com/http://www.jimcollins.com/


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is meant to be the follower, not the leader.The elephant needs guidance to over-come its reactions and impulses. Things

go better when you put your inner CEO incharge. For example, Richard Anderson,CEO of Delta Air Lines, learned to con-trol his emotional reactions, to bepatient and not lose his temper. Hisinner CEO realized that everything he didwas an example, and when he lost histemper it would squelch debate andsend the wrong signals. Carol Bartz,CEO of Yahoo, had a bad habit of inter-rupting people. She had to learn totake a breath, to shut up and listen.

HHooww ttoo CCoonn ttrroo ll YYoouurr IInnnneerr EE lleepphhaann ttThe challenge for leaders, once they

know what they should be doing differ-ently, is how to change themselves toeliminate a flaw or bad habit. When

leaders learn to strengthen their inner CEOand control their elephant, theyll do whatthey know is best. But under stress, aleader might repeat old patterns. Hereare eight ways to control your elephant.

1. Review the day. Spend 10 minutesin the evening reviewing the behaviorsthat worked and did not work duringthe day. At first, it is hard to rememberwhat happened, but with practice youwill remember everything. As you replayincidents in your mind, youll discovermore of the desired behavior repeatingitself the next day while the undesired

behavior will appear less often.2. Consult with one person. Consult-

ing with just one person before makinga decision or taking action will enlargeyour elephants thinking. Consult withseveral people, and your perspectivewill become large and balanced. Tryconsulting on every decision for onedayand watch your point of viewexpand, along with your wisdom.

3. Calm down. An agitated elephantis harder to control than a calm one.Anger, fear, frustration, and craving all

Your Inner CEO

EVERY LEADER AT TIMESwill fail to follow his

or her best intention.For example: I promised myself andmy boss that Id delegate the hiringdecisions, and then overrode my sub-ordinates decision, causing two peo-ple to quit. I put off my quarterlyreport until the last minute. Whensomething ticks me off, I overreact.Im overly critical of people, and theydont appreciate it, but I cant stop.

In the case of HPs recent CEO, whofudged travel expense reports to hide

the first-class airfares of an attractivevendor, his impulse overpowered hisbetter judgment. Most leaders who failare good at the cognitive stuffvision,strategy, ideasbut things often breakdown at executiontheir actions donot follow their stated intentions.

EExxeeccuuttiivvee vvss.. EE lleepphhaann ttThese managers knew the preferred

action, but some internal force pulledthem toward less desirable behavior.Leaders usually know what they shoulddo, so why arent they doing it? Accord-

ing to neuroscience, the brain has twosometimes-conflicting parts. The innerCEO is the higher part that sees theobjective big picture with a balancedapproach to determining the best action.The lower part is the inner elephant withits ego, unconscious impulses, emo-tions, and lifelong habits. The strengthof the leaders elephant may pull himor her toward micromanaging, puttingthings off, tactless remarks, insisting onalways being right, overreacting, find-ing fault (rather than appreciating, lis-tening, or focusing). Such behavior can

overpower the wisdom of the inner CEO.Most leaders have received feedback

from 360 reviews about what works anddoesnt work in their leadership style.Leaders often know what they shoulddo, how to do it, and why they shoulddo it. Yet when their intentions and be-haviors refuse to align, the unwantedactions of the inner elephant take priori-ty over the wisdom of the inner CEO.

The challenge for leaders is to devel-op the inner CEO to take command ofthe elephant. The lower part of the brain

give the elephant more strength. So,clear your head before making a deci-sion or pushing the email send button.If you are procrastinating, your elephantis feeling low-level anxiety. The elephantis easier to manage when relaxed. Tocalm down, try sitting quietly by thetask; soon youll start to work again.

4. Slow down your reactions. Toavoid overreacting to bad news, delayyour reactions. You might count to 10,

wait one minute, or wait 24 hours. Oneexecutive learned to ignore his response1 to bad news and waited for response 2,even if it meant responding the nextday. His response 2 was always wiser.Jeffery Katzenberg installed a five-sec-ond delay on his reactions so others couldexpress their views first. It enabled amore robust and effective dialogue.

5. Create a mental picture. Visualizinga desired behavior in your mind powerfullyimpacts your elephant. Imagine howyou want to give a speech, or handle adifficult conversation, and youll pro-

vide vivid visual instruction to yourelephant. Mental rehearsal often is aseffective as physical practice for improv-ing performance. Repeatedly visualizedoing a dreaded task, and youll morecalmly and smoothly flow through it.

6. Repeat a mantra. Try offering asuggestion to your elephant in the formof a well-crafted mantratelling theelephant what to change. Repeating Iam appreciating others more, I amlistening more carefully or I am dele-gating more responsibility, 20 times aday can reprogram your way of think-

ing and produce a striking change.7. Provide detailed structure. Go to a

fat camp and youll exercise and eathealthy. Why? The camp structures yourtime. Inner elephants also respond to ex-plicit, detailed instructions from the innerCEO. So, get everything you are doingout of your head onto paper, and iden-tify key steps and a deadline for each task.These steps are implementation intentionsthat enable your elephant to comply.

8. Try meditation. Meditation quietsthe active mind. To meditate, focusyour attention on an anchor object or

phraseor watch your breathing orslowly repeat a word or phrase thathas meaning for you.

As your inner CEO takes control ofyour inner elephant, youll be more inflow, more fulfilled, your rough edgessoftening, while becoming the bestleader that lies within you. LE

Richard Daft is the author ofThe Executive and the Elephant:A Leaders Guide for Building Inner Excellence and is theBrownlee O. Currey, Jr. Professor of Management in VanderbiltUniversitys Owen Graduate School of Management.

ACTION: Take control of your inner elephant.

by Richard Daft


ETHICS WISDOM

L e a d w i t h y o u r b e s t w i s d o m .


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of (then) Czechoslovakia, spoke of thetemptations of political power. He notedthat the privileges and perks of high

office have a devious allure, and that aleader can become so used to them thathe loses his perspective: He becomesa captive of his position, perks, andoffice. What apparently confirms hisidentity, and existence, in fact subtlytakes that identity and existence awayfrom him. He is no longer in control ofhimself, because he is controlled bysomething else: by his position and itsexigencies, consequences, aspects, andprivileges. Noting that there is some-thing treacherous, delusive,and ambiguous in the temp-

tation of power, Havelargues that politics requirespure people because its easyto become morally tainted.

Since, as Shakespearesaid, the abuse of great-ness is when it disjoinsremorse from power, any-one who attains a positionof power needs to resist thetreacherous temptations of power andremain morally sensitive and alert tothe self-delusions that can distort char-acter. Of course, this is easier said than

done, particularly in cultures where theexercise of power is Machiavellian. AsSteve Forbes observed, As more moneyflows through Washington and as Wash-ingtons power to regulate our livesgrows, opportunities and temptationsfor graft, influence peddling, and cut-ting corners grow exponentially. Powerbreeds corruption. Indeed, power corrupts;and absolute power corrupts absolutely.

Business leaders also face manytemptations to abuse power. Hence, wesee scores of con men and corrupt lead-ers whose aims are self-serving, whose

victims often include close familymembers, and whose abuse of powerentrusted to them ruins investors anddamages or destroys companiesfromTycos Dennis Kozlowski, AdelphiasJohn Rigas, and Socit GnrelesJrme Kerviel to Billie Sol Estes,Enrons Jeff Skilling and AndrewFastow, HealthSouths RichardScrushy, Wall Streets Bernie Madoff,and Countrywides Angelo Mozilo.

Unlike politicians, business leadersare often out of the public eye and

Power and Influence

DOES MIGHT MAKEright, or are people

in power largely govern-ed by the better angels of their nature?Is any use of power immoral? Considerjust a few of the atrocities in the past90 years of human history: the Turkishgenocide of Armenians circa 1919; theNazi genocide of six million Jews circa1944; the millions of Russians andChinese killed by Stalin and Mao toconsolidate power; the killing fields inCambodia; the mass killing ofMuslims in Bosnia; the genocide of the

Tutsis by the Hutus in Rwanda; or theslaughter of innocents in Darfur.

Muckraker Lincoln Steffins argues,Power is what men seek, and anygroup that gets it will abuse it. AndJames Madison, one of the FoundingFathers of the United States and itsfourth President, said, The essence ofgovernment is power; and power,lodged as it must be in human hands,will ever be liable to abuse. And,British statesman Edmund Burkewarned, The greater the power, themore dangerous the abuse.

Weve all observed the corruptingnature of powerand the potential forabuse when any power is concentratedin too few hands with too few checksand balances. The beatific view ofhuman nature inherent in the GoldenRule is either distorted or corrected bythe more perverse version: He whohas the gold makes the rules.

Some believe that power, by its verynature, is immoral, and that wheneverpeople have any degree of control overthe lives of others, theyll likely abusethat power. Sadly, weve seen ample

evidence in recent yearsfrom formerMerrill Lynch CEO John Thain spend-ing $1,400 on a wastebasket while hisfirm was collapsing, to former BoeingCEO Harry Stoneciphers ouster afterbeing caught in an improper sexualrelationship with a female executivethat people in positions of power, nomatter how smart they may be, canoften not resist the sirens call of greedor the abuse of their positions.

In 1991, during his acceptance of theSonning Prize, Vclav Havel, president

shielded from effective scrutiny, partic-ularly if their boards are inept and theirinfluence extends to the people expect-ed to be watchdogs for the public trust.The failure of boards (think Enron) toexercise effective oversight led to theSarbanes-Oxley bill. Were still debatingjust how much new regulation of banksand investment houses is necessary toprevent the blind excesses (spurred byself-interest) that fueled the damaging

recession in 2008-2009. Clearly, unbri-dled power in too few hands is a recipefor disaster, particularly when the peo-ple in power are more motivated byself-interest (Bernie Madoff) than thecollective good (Adam Smith).

After studying the need for power,David C. McClelland and David H.Burnham conclude: Top managersmust possess a high need for poweraconcern for influencing people; howev-er, this need must be disciplined and

controlled so that it is direct-ed toward the benefit of the

institutionnot their per-sonal aggrandizement.This, then, is the challenge:how to attain and usepower wisely and in a dis-ciplined way, how to exer-cise power without abusingit or allowing its focus to bethe elevation of the leadersself-interests.

Power is not innately immoral; none-theless, power can distort the powerholder, especially when that power isabsolute and unchecked, and it can lead

him or her to justify acts which, seen inthe clear light of history and unbiasedobservation, are clearly immoral.

IInnfflluueennccee GGoonnee AAww rryySome gurus claim that if you follow

their principles, you can influence any-one to do anything: you can get anyoneto like you, love you, and find you irre-sistibly attractive; you can take controlofany situation, win every competition,and gain the upper hand every time;you can get anyone to say yes to what-ever you propose within minutes.

When I read such claims, Im remindedof what Abraham Lincoln said: You canfool some of the people all of the time, and allof the people some of the time, but you cantfool all of the people all of the time.

The idea that you can influence any-one to do anything is nonsense. Peoplemay not be moved by your influenceattempt for many reasons. In his bookWhat Leaders Really Do, John Kotterwrites: Some people may be uncoop-erative because they are too busy, somebecause they are not capable of helping,

by Terry R. Bacon

1 0 W i n t e r 2 0 1 1 L e a d e r s h i p E x c e l l e n c e

LEADERSHIP POWER

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secretary. And many a governmentofficial who becomes a university presi-dent has trouble adapting to the flatpower structure of academic life.

Contextual intelligence is an intu-itive diagnostic skill that helps a leaderto align tactics with objectives to createsmart strategies in new situations. Itimplies a capability to discern trends inthe face of complexity and adapt whileshaping eventsthe ability to intuit move-

ments and seize them. More prosaically,like surfers, leaders with contextualintelligence have the judgment to adjustto new waves and ride them to success.

Contextual intelligence allows lead-ers to adjust their style to the situationand to their followers needs. It enablesthem to create flows of information thateducate their hunches. It involves thepolitical skill of not only sizing up grouppolitics, but of understanding the posi-tions and strengths of various stake-holders so as to decide when and howto use transactional and inspirational

skills. It is the self-made part of luck.In unstructured situations, its often

more difficult to ask right questions thanto get right answers. Leaders with con-textual intelligence provide meaning

by defining the problemthat a group confronts.They understand the ten-sion between the differentvalues involved in an issue,and how to balance thedesirable with the feasible.

Contextual intelligenceconsists of cognitive analyt-

ic capabilities and of tacitknowledge built from expe-rience. Tacit knowledge

tends to be implicit and inarticulate, orexpressed in rules of thumb. In some sit-uations, street smarts are more importantthan school smarts. In novel situations,judgment matters more than experience.

Contextual intelligence also requiresemotional intelligence. Without sensi-tivity to the needs of others, pure cog-nitive analysis and long experiencemay prove insufficient. Jimmy Carterhad good cognitive skills, but was

often faulted on his contextual intelli-gence. As one wag put it, he was betterat counting the trees than seeing the forest.

The best leaders transfer their skillsacross contexts. Leaders who have afixed repertoire of skills are limited in theirresponses to new situations. They needto develop broader bandwidth and tunecarefully for different situations. LE

Joseph S. Nye, Jr. is University Distinguished Service professorat Harvard and author ofThe Powers to Lead (now an OxfordUniversity Press paperback). Visit www.hks.harvard.edu.

ACTION: Enhance your contextual intelligence.

THE RECENT PUBLICA-

tion of George W.Bushs memoirs raises

again the role of contextual intelligence inleadership. President Bush famously des-cribed his leadership role as the decider.But deciding how to decide is as impor-tant as making the final decision: whatshould be the composition of the groupthe leader turns to; what is the contextof the decision; how will information becommunicated; and how much controldoes the leader maintain over the deci-sion? Get such factors wrong and youmay be decisive, but decisively wrong.

Bush described his leadership as havingthree core components: outline a vision,build a strong team, and delegate much of theprocess to them. Analysts who examinedBushs decision-making on Iraq arguethat neither he nor those towhom he delegated knewthe complexities. Withoutcontextual intelligence, being adecider is not enough!

Understanding context isvital for effective leadership.Some situations call for auto-cratic decisions, others re-

quire the opposite. Leadersmust operate in myriad con-texts, but its vital to under-stand culture, distribution of powerresources, followersneeds and demands,time urgency, and information flows.

Ronald Heifetz argues that if the sit-uation calls for technical and routine solu-tions, the leader may clarify roles andnorms, restore order, and provide asolution. But if the situation requiresadaptive change, the leader may let con-flict emerge, challenge unproductivenorms and roles, and let the group feel

external pressures so that it learns tomaster the adaptive challenge. Thismay require delaying decisions and usingfollowers anxieties as a learning experience.

Half of General Electrics high flyerswho went on to become CEOs of othercompanies had disappointing records.Why do some leaders succeed in one con-text and fail in another? One answer ishorses for courses. Some run betteron a dry track and some in mud. Manya good CEO turns out to be a disap-pointment when appointed as a cabinet

Contextual IntelligenceIts crucial for effective leadership.

by Joseph S. Nye, Jr.

CAPABILITY CONTEXTand others because they have goals, val-ues, and beliefs that conflict with thoseof the manager; therefore, they have nodesire to help or cooperate. Also, thepeople youre trying to influence maynot care about what you want them tosupport. They may disagree with youropinion, idea, suggestion, proposal, orpoint of view. They may not need whatyou are selling, accept your reasoning,or be inspired by what you are saying.

They may be distracted, or disregard you.Salespeople spend more time study-

ing and practicing methods of influence,yet even the best of them cant sell theirproducts or services to every customerall the timebecause some customerswont be persuaded for reasons that mayhave more to do with the customersand the situation than the salesperson.

One subtle way people try to influ-ence others is by appealing to authority.Such legitimizing is so ubiquitous thatwe often dont recognize it. When youtry to influence someone by legitimiz-

ing, you essentially say, Trust me,believe me, or obey me because someauthority says you should. The author-ity could be a parent, boss, police officer,judge, cleric, or teacher whom the otherperson would consider an authority.

Legitimizing occurs when someonewears or displays the symbols of lawor authoritya police officers uniformand badge, a judges robes and gavel, amilitary persons uniform and insigniaof rank, the robes of a monk or cleric,and so on. People also legitimize whenthey cite a persons title, position, or

role; by citing a group representingauthority; by citing achievements orhonors; by citing previous works,precedents, or publications; by citing aperson of renown or something thatperson said; or by citing an agreement,behavioral norm, moral, tradition, law,regulation, or accepted standard.

One advantage oflegitimizing is that itcan influence people quickly. Civilizationwould not function well without legit-imizing to regulate behavior and choic-es. A major draw-back to legitimizing isthat many people are antiauthoritarian

to some degree and resist some types ofauthority. Their degree of compliancedepends on how much they respect theauthority being cited and whether theybelieve their compliance is necessary oradvantageous to them. The less respectpeople have for authority, the lesstheyll be influenced by legitimizing. LE

Terry R. Bacon is author ofThe Elements of Power (AMACOMBooks) and Elements of Influence: The Art of Getting Others toFollow Your Lead (forthcoming). Visit www.terryrbacon.comand www.kornferryinstitute.com;[email protected].

ACTION: Influence people to follow your lead.

L e a d e r s h i p E x c e l l e n c e W i n t e r 2 0 1 1 1 1
http://www.hks.harvard.edu/http://www.terryrbacon.com/http://www.kornferryinstitute.com/mailto:[email protected]:[email protected]://www.kornferryinstitute.com/http://www.terryrbacon.com/http://www.hks.harvard.edu/


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Empower women to recharge the world.We see a direct correlation between womensempowerment and national GDP growth,business growth, environmental sustainabil-ity, and improved human health, to namea few things. The family, community,and social implications are vast. Ourconsumer research points to women as thehousehold opinion elites. Women deter-mine what comes into the home and in

what quantity and frequency. Womenaccount for most purchase decisionsfor our beverages. In fact, they repre-sent 70 percent of all grocery shoppers.So, at Coca-Cola, we cant grow ourbusiness or reach any of our long-termgoals without greater womens eco-nomic empowerment and entrepre-neurship worldwide. In fact, no businessor economy will grow without this.

Growth projections for China, India,Africa, and North and South Americacant be met without womens econom-ic empowerment. The only way a pro-

jected billion people will rise to middleclass in the next 10 years; the only waythe world will grow $20 trillion dollarsricher; the only way more nations will

rise out of poverty and become politi-cally stable will be by women achiev-ing gender parity. If we fail in thisregard, the worlds economy will fail.

We still see too many roadblockscultural, educational, political, financial, andtechnologicalto womens empowerment.As President Obamas Ambassador forGlobal Womens Issues Melanne Verveersaid about the lack of access to capitalfor women entrepreneurs: Too many ofthe best business ideas die in bank parking

lots. Thats got to change, and it will change.

TThhrreeee TThh iinnggss WWee ccaann DDooI see three ways that business, gov-

ernment, academia and non-profits canhelp generate female empowerment:

1. Accelerate womens leadershipwithin our walls. I serve as chair of ourcompanys Womens LeadershipCouncil, which we initiated three yearsago. The program is built around threefocus areas: building a leadershippipeline, creating an enabling culture

Women Power

DRIVING INTO WORKone morning, I gotstuck in traffic and

tuned into a report on the radio aboutChinas rise in the world. Some econo-mists predicted that China would sooneclipse Japan as the worlds secondlargest economy. It already hasfiveyears ahead of most projections!

No one chronicles the economic riseof nations better than Yale professorFareed Zakaria. In The Post-AmericanWorld, he writes about the nations that

will drive the 21st century economy,and the implications for America.

I think theres another way of look-ing at this. Id say that the real driversof the Post-American World wont beChina, India, or Brazilor any nation.The real drivers will be women: womenbusiness, political, academic and cul-tural leaders, entrepreneurs, and inno-vators. Women are the most dynamic andfastest-growing economic force today. Theycontrol over $20 trillion dollars in spend-ing worldwide (an economic impactlarger than the US, China, and India

combined. In the U.S., women-ownedbusinesses account for $4 trillion dollarsin GDPthis would constitute thefourth-largest economy in the world!Today, one in 11 working-age womenis involved in entrepreneurship.

The 21st century is the Womens Cen-tury. As we look for ways to restart andreset the global economy, the solutionlies right in front of us. In the words ofWorld Bank President Robert Zoellick,gender equality is smart economics.

Ive been managed by women all ofmy lifebeginning with my mother

and I like to think theyve done a won-derful job. As a business leader andsomeone who has the responsibility ofcreating shareholder value for theworlds most recognized brand, I feel asense of urgency in ensuring that con-ditions are ripe for women to thrivearound the world. Call it self-interestor enlightened self-interestcreating aclimate of success for women globallyis simply smart business for a con-sumer-products company. In fact, itssmart business for any company.

that values personal sustainability, anddriving employee engagement.

One concern for our women employ-ees globally is work-life balance. To easesome of the burden, we initiated flexi-ble-work arrangements and provided aglobal framework and tool kits for ourbusiness units around the world.

In addition, weve grown the num-ber of women in upper managementpositions, and our female employee engage-

ment rate is now higher than our overallengagement rate. Today, women hold topleadership positions in our finance group,make up half of our Public Affairs andCommunications leadership team, andabout half of our legal team. We havewomen in our top science and regulato-ry, quality and HR positions. Our Euro-pean operations are led by a woman,and our operations in my native coun-try, Turkey, is run by a woman.

We have aggressive metrics embed-ded into our 2020 Visionour growthpath forward. We are expecting to dou-

ble our volume and revenue, to be amongthe greatest places to work, and to be evenmore consumer focused, more communityfocused, and more environmentally focused.We cant do any of that without greaterparticipation of women at our seniorranks. For Coca-Cola, this is missioncritical. The keen insights women bringto our business are profound. As morewomen worldwide gain economicpower, we need to be there to ensurethe right shopper insights, the rightmix of products, and the right market-ing and merchandising strategies.

2. Bring more women-owned busi-nesses into our supply chains. Becauseof our global reach and influence, wecan be powerful agents of constructivechange. One exciting program at Coca-Cola is our Micro Distribution Center(MDC) network in Africa. This enablesentrepreneurs to set up MDCs on behalfof our company in areas where poorroads and infrastructure make it diffi-cult for delivery trucks to travel. Theydistribute our products to retailers, oftenby bicycle or pushcart. Most of our salesin Kenya, Tanzania, Uganda, Ethiopia

and Mozambique are the result of thismodel. Almost 1,000 of these businessesin Africa are owned by women. Rose-mary Njeri has run a MDC in Nairobifor 10 years. She now employs 16 peo-ple and has educated her three children.

Consider the multiplier effect of suchactions. Today, we work with 10 millionwomen-owned or operated business-esfrom suppliers and distributors toretailersthat derive a major portion oftheir profits from Coca-Cola.

Recently we committed to help em-

by Muhtar Kent

1 2 W i n t e r 2 0 1 1 L e a d e r s h i p E x c e l l e n c e

LEADERSHIP WOMEN

I t w i l l r u l e t h e w o r l d .


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dent collaborators who work in teams(or cyberspace) with ease. However,their moral values may not be strong.We must fix this disconnect, by con-necting with them on their terms. AtDeloitte, weve revamped our Ethics inAction training for new hires by mak-ing it online, interactive, and attractive.

2. Short-termism. Milliennials areless likely to stay with a company forfive or more yearsand twice as likely

to leave within one yearthan oldercounterparts. The pressures that comewith expectations ofcontinuous growthcan cause leaders to be short-sighted,driven by short-term goals. The hid-den costs become visible when a stableworkforce, long-term investment, anda sustainable business disappear. I see alink between short-termism and unethicalconduct. The nature of short-termismdisdains the work that long-term rela-tionships take while embracing the pay-back of quick, impersonal transactions.The mortgage crisis is an example.

Whether it was the borrower seekingthe loan, the banker making the loan,or the broker packaging and sellingrisky obligations, the only glue that heldthem together was the transaction. Some

might call it enlightenedself-interest. I call it a recipefor unethical behavior.

3. Trust. Trust seems tobe in short supply: 34 per-cent of employees will likelylook for a new job when theeconomy improves; of those,48 percent cite loss of trust

in their employer and lack oftransparent communicationfrom their leaders as their

reason. Like ethics, trust is good busi-ness. Low trust is expensive. You buildrelationships of trust through direct,regular, and open interactions. AtDeloitte, our ethics campaign includestraining called the Power of One. It rec-ognizes the importance of our choicesand behaviors and how we each havethe responsibility to act with personalintegrity to sustain the publics trust.

An unethical culture can bring down

an enterprise. So, draw the connectionbetween ethical behavior and the value ofthe enterprise. Ensure that how you con-duct business is worthy of the valueyour customers expect and representsthe values of the enterprise. You can bemore than an invisible hand. Throughthe influence of your example, givepeople reasons to follow you. LE

Sharon Allen is Chairman of the Board, Deloitte LLP. Thisarticle is adapted from her speech at the Ethics and ComplianceOfficers Association meeting, Sept. 22, 2010.

ACTION: Be the visible hand of high ethics.

ADAM SMITH WROTE

about the invisiblehand that drives free

markets. I believe that another invisiblehand drives free marketsthe sharedlanguage of ethical values that enablespeople to conduct business with eachother, where a deal can be sealed with ahandshake and your word is your bond.

Ethical leaders help create robustmarkets where trust and integrity canprevail. But often, we see headlinesthat tell of decision-makers who failedto consult with their ethics and compli-ance officers or with their own moral

compass, and who made choices thattook them dangerously off course.

Today, we face a challenging econo-mybecause of choices made by cer-tain leaders. All leaders are entrustedwith a mission, and manypeople count on their lead-ers to help build an ethicalfuture. Ethical behaviorkeeps us connected. Everyday, people decide who tofollow. It is crucial thatthey cast their ballots foryou and what you stand

for. But you have lots ofcompetition for theirvotesespecially from rolemodels in popular culture.

The power of role models cuts bothwaysgood and bad. Twenty yearsago, two powerful role models in busi-ness werent even in business. Theyportrayed on film a style or creed thatsome would later adopt. For 13 seasonson Dallas, J.R. Ewing (Larry Hagman)took business ethics on a race to thebottomdoing whatever it took to crushhis competitors. Now, Michael Douglas

reprises his role as corporate raiderGordon Gekko in Wall Street II: TheMoney Never Sleeps. We all recall hisiconic speech to shareholders: Greedis good. Greed is right. Greed works.

OOvveerrccoommee TThhrreeee DD iissccoonnnneeccttssTo build an ethical future, leaders

need to overcome three disconnects:1. Generational. Young people today

are fascinating. Some refer to them asGeneration Me. I prefer to focus on theirstrengths. Millennials are smart, confi-

Visible HandsBe an example of ethics.

by Sharon Allen

ETHICS EXAMPLEpower 5 million women entrepreneursby the year 2020. I have seen the powerand conviction of our system, andwhen we put our mind to somethingwe achieve results. To achieve this,well partner with other companies,governments and civil society organi-zations to bring all of our skills andresources to bear to help break downthe barriers that small businesswomenfacebarriers like access to credit,

peer networking, and basic training.Well give high potential women in

our system a chance to champion andmanage this work. We can transfer somuch business knowledge to emergingentrepreneurs: basic accounting, busi-ness planning, marketing, merchandis-ing, customer service, and legaladviceto name a few areas.

And were encouraging all Coca-Cola associatesmen and womentosupport women small business owners viaone-on-one mentoring and training. Thisinitiative will also reach millions of

men. All boats will rise. As our suppli-ers and retail customers gain greaterskills and empowerment, their busi-nesses will reflect this, and Coca-Colasbusiness will reflect this. We are all inthis together. As women rise in theircommunitiesthe communities rise tonew heights of prosperity and health.

3. Stay committed to sustainabilityinitiatives. Recommit to sustainabilityprogramseducational, environmen-tal, human-health, cultural, and eco-nomic-development initiatives. All ofthese touch and influence womens

empowerment and entrepreneurship.In the communities we serve in 206countries, weve learned that everythingis interrelated. Water is central to ourfuture. Water is also a womens economicempowerment issue. For example, inMali, we dug a well in a rural villageso that women wouldnt have to spendeight hours a day hauling water. Thisenabled them to reinvent their livesand start their own catering business.

Smart organizations will see thatthe 21st century is the Womens Century.Womens economic empowerment and

entrepreneurial growth will drive theworlds economy to new heights. Forall of usthe implications will be vast.Everyones success will be contingentupon womens success. This is not a bat-tle of the sexesthis is a battle for preserv-ing and enhancing the worlds economic,environmental and social fabric. LE

Muhtar Kent is Chairman and CEO, The Coca-Cola Co. Thisarticle is adapted from his speech at the Yale World FundLecture and used with permission ofVital Speeches of the Day.Visit www.VitalSpeeches.com.

ACTION: Empower women in your workforce.

L e a d e r s h i p E x c e l l e n c e W i n t e r 2 0 1 1 1 3
http://www.vitalspeeches.com/http://www.vitalspeeches.com/


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minimize your weaknesses. Be trust-worthy, but verify what youre told.While most people are trustworthy,many are not, and you cant tell bylooking at them or talking to them.Believe what you say and say whatyou mean. Use the power of convictionand transparency. Be r

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