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Lessons from the Great American Leaders & How They Apply Now

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Communication Has to Start With Telling the Truth

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Warren Buffett (L), chairman and CEO of Berkshire Hathaway Inc. and David Rubenstein (R), president of the Economic Club of Washington, participate in a discussion during the 25th anniversary celebration dinner of the Economic Club of Washington June 5, 2012 in Washington, DC.  (Photo by Alex Wong/Getty Images)

Warren Buffett (L), chairman and CEO of Berkshire Hathaway Inc. and David Rubenstein (R), president of the Economic Club of Washington, participate in a discussion during the 25th anniversary celebration dinner of the Economic Club of Washington June 5, 2012 in Washington, DC. (Photo by Alex Wong/Getty Images)

Warren Buffett (Berkshire Hathaway) remarked, “‘It’s vital to be able to communicate well… Just being able to communicate with others on the job adds at least 50% to your value.” Open and effective communications at all levels solves many problems and reduces conflict before it even occurs. Lee Iacocca (Chrysler) declared, “A leader has to communicate. I’m not talking about running off at the mouth or spouting sound bites. I’m talking about facing reality and telling the truth…

Communication has to start with telling the truth, even when it’s painful.” Iacocca notes the importance of intellectual honesty as part of the communication process. “Iacocca says he’s not talking about verbosity or sound bites. He means facing reality and telling the truth, even when it’s painful. If you apply spin, people will know—they’re not stupid—and they’ll stop listening.”

“Peter Drucker [felt] the most valuable asset in a firm is the collective knowledge of its employees. But to realize that value, the people in an organization have to be able to share that knowledge. That means ‘them that’s got it’ have to be able to give it to ‘them that don’t.’ And that transaction requires two-way communication between inspired transmitters and welcome receivers.” The great leaders understood this. In fact, most spent a great deal of their time on the “factory floor” meeting with managers, supervisors and employees to see firsthand what is happening and to understand the problems and issues facing their companies.

At Hewlett-Packard it was discovered that “‘Management by Walking Around’ improves communication, improves quality, improves teamwork, and improves profits. Hewlett and Packard’s visible presence and easy availability (they insisted on a company-wide open-door policy, believing that interruptions were a small price to pay for the advantages of open and frank communication with the talented people they hired) earned them deep credibility with their co-workers. A drill press operator on the outskirts of the factory knew that the CEO and President understood what he did and appreciated his contribution.”

As was previously pointed out, John Patterson (National Cash Register) actually moved his office into the middle of his factory floor. While other leaders, such as Henry Heinz (H.J. Heinz), Harvey Firestone (Firestone Tire), William Proctor (Proctor & Gamble), and George Westinghouse (Westinghouse) did not go to that extreme, they still remained highly visible, and openly and frequently communicated with their employees. In recognition of his frequent presence on the factory floor, Harvey Firestone’s casket was walked through his factory one last time, at the time of his death.

The great leaders spent the majority of their time traveling and communicating with employees and key constituencies. This allowed them to become personally acquainted and to influence employees on all levels. It also provided them with the opportunity to elicit feedback to make more accurate and fact-based decisions.

Fredrick Crawford (TRW) spent “much of his time speaking to employees and projecting the force of his ideas and his personality. One observer called him ‘a natural leader of tremendous vitality, self-assurance and singleness of purpose.’ But there was more to the Thompson program than Crawford. At all levels of the organization, managers tried to convince workers that the company had their best interests at heart…

Thompson managers referred employees as ‘members of the Thompson family’ and tried to minimize status distinctions between managers and workers… the firm’s policies were guided by an effort ‘to eliminate class lines and have our relationships on a first name basis.’”

While this may appear commonplace, some influential leaders like Cary Fiorina (Hewlett-Packard), Richard Fuld (Lehman Brothers) and Roger Smith (General Motors) avoided meeting with their employees. Not only that, they strictly limited their accessibility to them. These leaders, among others who exhibited this characteristic, experienced substantial problems on multiple levels.

Related:

The Need to Test Opinions Against the Facts

The Capacity to Face Reality

Don’t Push Out Figures When Facts Are Going in the Opposite Direction

References:

  1. Stein Ben, Ben Stein: More from My Dinner with Warren (Fortune Magazine, January 7, 2010)
  2. Iacocca Lee, Where Have All the Leaders Gone? (Scribner, 2007)
  3. Iacocca on the Need for Leadership Now (Business Management Daily, March 31, 2010)
  4. Willax Paul A., To Communicate Better, Improve Your Listening Skills (New Hampshire Business Review, September 28, 2007)
  5. Orfalea Paul, Helfert Lance, Lowe Atticus and Zatkowsky Dean, Inspirational Figures David Packard (West Coast Asset Management)
  6. Jacoby Sanford M., Reckoning With Company Unions: The Case of Thompson Products, 1934-1964 (Industrial and Labor Relations Review, October 1, 1989)

Excerpt: Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Majorium Business Press, Stevens Point, WI 2011) Read a Free Chapter

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
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