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Lessons from the Great American Leaders & How They Apply Now

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“Leaders Should Set a Clear and Decisive Tone at the Top”

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Admiral Hyman Rickover, USN

Admiral Hyman Rickover, USN

The wealth, power and influence of the great leaders is widely known. How they achieved it is another issue unto itself. They were people of achievement, capability and resilience. They had their personal convictions continually tested as they faced countless and enormous difficulties and challenges. Yet, it was their character, ethics, morals and values that utterly defined them as great leaders. In the quest for wealth, fame and power, many individuals will tend to sacrifice these qualities on the altar of achievement.

Admiral Hyman Rickover in a 1977 speech stated, “There is abundant evidence around us to conclude that morals and ethics are becoming less prevalent in people’s lives. The standards of conduct, which lay deeply buried in accepted though for centuries no long are absolute. Many people seem unable to differentiate between physical relief and moral satisfaction; they confuse material success in life with virtue.” What distinguished the great leaders from typical ones was their refusal to sell themselves out, or to compromise their integrity for the sake of money, power or prestige.

Rickover was prophetic. Since his remarks, this country has seen corporate scandal after scandal occur, including a stable of well-known companies, such as Drexel Burnham, Enron, Arthur Anderson, WorldCom, Tyco International, Countrywide, AIG, and Lehman Brothers, just to list a few. The actions of a handful of wealthy and influential leaders  threw the country into a financial panic, as well as a lengthy and deep recession. It resulted in costing millions of individuals and families their homes, savings and retirements. It destroyed trust and credibility within our society. This was further exasperated when many of the companies and leaders who were directly responsible for such pain and misery became isolated from the consequences of their actions and behaviors through government bailouts, generous “golden parachutes,” and performance bonuses.

Sharon Allen, Chairman of Deloitte LLP wrote in the introduction to The Deloitte LLP 2010 Ethics & Workplace Survey, “Regardless of the economic environment, business leaders should be mindful of the significant impact that trust in the workplace… By establishing a values-based culture, organizations can cultivate the trust necessary to reduce turnover and mitigate unethical behavior…. Ultimately, an organization’s most senior leaders should set a clear and decisive tone at the top.”

“Ethics and moral judgment are not new concepts for leadership. They have been identified as critical characteristics of leadership over the last century. An organization’s leaders help define the culture, values, standards, and moral character of the organization having ramifications both inside and external to the organization. Ethical leaders have been found to display pride yet reject selfish and conceited behavior… Ethical leaders are not normally high-profile charismatic leaders but are quiet leaders moving ‘patiently, carefully, and incrementally…’”

The great leaders are defined by who they are as individuals. They have all been shaped by their character, morals, values, integrity and ethics. These are the values that define them as being truly great and valuable, whether or not they actually achieved publically recognized pinnacles of success.

  1. Admiral Rickover H.C., Thoughts on Man’s Purpose in Life (speech presented at the San Diego Rotary Club, 1977)
  2. The Deloitte LLP 2010 Ethics & Workplace Survey (Deloitte LLP, August, 2010)
  3. Scharff M.M., WorldCom: A Failure of Moral and Ethical Values (Journal of Applied Management and Entrepreneurship, July 2005)

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2014 Timothy F. Bednarz, All Rights Reserved

Leaders Are Judged By The Actions They Take

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Kelleher--William-Thomas-Cain-Getty-Images

Of all the leaders surveyed, the great ones were individuals who consistently displayed their integrity and character. No matter what happened in their lives: adversity, controversies, failure and defeat, their character shined through. It established deep personal credibility with each of their constituencies, as well as all others that came into contact with them.

First and foremost, leaders are judged by the actions they take. Today’s high profile leaders are prominently visible to all of their key constituencies. They make speeches and presentations to employees, shareholders, financial analysts, and the public in general.

Herb Kelleher (Southwest Airlines) exemplifies this. “He’s totally true to himself and totally consistent between his private life and his public life. He’s totally consistent between his public speeches and his private speeches. You could look at a speech that Herb gave to the annual shareholders meeting of 2002 and compare it to his message to the field in 1992 and compare it to a letter to employees in 1982 and find tremendous consistency in terms of adherence to core values.

So the absolute adherence to extraordinarily high professional principles of ethical conduct and fair dealing, is just remarkable over time. So he built up a reservoir of credibility not only among employees but other people.”[1]

Many leaders may sound impressive, but simultaneously undermine their credibility since their actions fail to mirror their words. In some instances, leaders’ actions contradict their company’s mission statement, resulting in confusion within their organization. In either case, their personal actions become corrosive to the organizational culture, as well as their own individual credibility.

As a high profile leader, Carly Fiorina’s (Hewlett Packard) actions were highly scruntized and undermined her credibility. “Fiorina came in with a mandate of change, but didn’t make any effort to build trust between herself and the company. Indeed, she sullied her image by exalting herself without regard to her employees’ reactions.

Buying a personal jet in front of a distrustful and alienated workforce is one example. Freezing employee salaries while giving herself and her executive ilk bonuses is another. Doing these things in light of nearly 18,000 employee dismissals (2003) is just plain callous.”[2]

Leaders’ actions set the tone for their organization, whether they realize it or not. They can either inspire or generate resentment in their employees. Fred Smith (FedEx) inspired his organization by setting a tone where all his employees felt they could share in the success of the company.

He stated, “One of the biggest principles is that you’ve got to take action. Most large organizations reach a static point. They cannot take any action, because there are all types of barriers to doing so. There are institutionalized barriers that weren’t there when the company was considerably smaller. What changes is your knowledge and your appreciation of how to deal with those institutional barriers, to eliminate them or use them to your advantage in achieving those changes. There are myriad number of changes that have to take place in the management style for the company to continue growing.”[3]

“’Andy [Grove][Intel] has always been a teacher – often by example,’ says Ron Whittier, senior vice president in charge of content development… Yet I don’t think he wants to be remembered as a great visionary – but as someone who made things happen and created a great company.’”[4]

All constituencies expect leaders to be fair, just and consistent. Any perception of cronyism and the use of internal politics to develop an advantage for one individual or group generates unintended consequences, as these policies and actions are replicated at lower levels. Yet, for certain types of leaders, potential gains are too tempting not to employ these practices.

Their focus on personal gain, however, becomes transparent to the rest of the organization. This destroys trust and channels of openness and honesty throughout the company. Fredrick Joseph (Drexel Burnham) created a dysfunctional culture when he ignored the unethical practices and securities violations of high-powered Michael Milken, and his creation of the junk bond business. The insider-trader scandals surrounding Milken ultimately led to the largest bankruptcy in Wall Street history at that time.

These actions hamper leaders’ abilities to instill their ideas, beliefs and values in others, and significantly hinder them when communicating sweeping strategies that are needed to move organizations forward. Rather than unite different factions, they splinter any existing unity, as different groups jockey for position. Leaders in this position typically tend to use their authority and power in a repressive rather than productive manner. It saps the company’s available resources and diminishes its productivity.

A notable and well-publicized example of this practice is Al Dunlap (Sunbeam). “In Dunlap’s presence, knees trembled and stomachs churned. Underlings feared the torrential harangue that Dunlap could unleash at any moment. At his worst, he became viciously profane, even violent. Executives said he would throw papers or furniture, bang his hands on his desk, and shout so ferociously that a manager’s hair would be blown back by the stream of air that rushed from Dunlap’s mouth. “Hair spray day” became a code phrase among execs, signifying a potential tantrum.”[5]

My research of some of the poorest performing leaders substantiated that many also made questionable and highly risky financial decisions that placed their companies at risk, and placed the well being of shareholders far above the interests of their customers.

“In the service of a quick buck, he [Al Dunlap – Sunbeam] imposed brutal pressure on honest people, placing their careers, incomes, health insurance, and pensions at stake. He made impossible, irrational demands that were ruinous to the long-term prosperity of companies. The leadership style he practiced was inconsistent with good business, thoughtful management, a strong economy….”[6]

Jon Huntsman (Huntsman Chemical) observed. “People often offer as an excuse for lying, cheating, and fraud that they were pressured into it by high expectations or that “everyone does it.” Some claim that it is the only way they can keep up. Those excuses sound better than the real reasons they choose the improper course: arrogance, power trips, greed, and lack of backbone, all of which are equal-opportunity afflictions.”[7]

The great leaders were committed to others and demanded excellence from all. They forged building blocks of growth and were proactive as they mastered execution of their plans within all levels of their organization.

They demanded accountability on all levels and did not delegate this responsibility. They held themselves equally accountable, and adhered to the same standards as were established for the lowest level employee. This typically appealed to their personal sense of fairness.

“More than anyone, leaders should welcome being held accountable. Nothing builds confidence in a leader more than a willingness to take responsibility for what happens during his watch. One might add that nothing builds a stronger case for holding employees to a high standard than a boss who holds himself to even higher ones.”[8]

These leaders were passionate, and demonstrated a high level of personal drive and resilience. These factors made it possible to build emotional connections with key constituencies, especially needed during difficult periods.

Finally, one of the most notable distinctions of great leaders was found in their restraint and self-control. It inspired confidence in all key constituencies. A key example of this trait was the composure and stature James Burke (Johnson & Johnson) displayed during the Tylenol scare. His actions are attributed to saving that brand and securing the company’s impeccable reputation.

Related:

  1. Legitimacy: The Sole Basis of Leadership
  2. Does Compassion and Empathy Have a Role in Leadership?
  3. Your Commitment to Others Defines You as a Leader

References:

  1. Yeh Raymond T. with Yeh Stephanie H., The Art of Business: In the Footsteps of Giants (Zero Time Publishing, 2004)
  2. Knufken, Drea, 10 Reasons People Hate Carly Fiorina (Business Pundit) June 18, 2008
  3. Hafner, Katie, Fred Smith: The Entrepreneur Redux (Inc. Magazine, June 1, 1984)
  4. Sheridan John H., 1997 Technology Leader of the Year Andy Grove: Building an Information Age Legacy (Industry Week, April 19-21, 2010)
  5. Byrne, John A., Chainsaw (Harper Business, 1999, 2003) p 353-354
  6. Gallagher Bill, Once a Bum, Always a Bum (Niagara Falls Reporter, January 29, 2002)
  7. Huntsman, Jon M., Winners Never Cheat Even in Difficult Times (Wharton School Publishing, Upper Saddle River, New Jersey, 2008) p 35
  8. Giuliani, Rudolph, Leadership (Hyperion, New York, 2002) p 70

 

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

 

//

Be Smart Enough to Surround Yourself With Good People

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Holiday Inn leaders scout new project / Wallace E. Johnson (left), president, and Kemmons Wilson, chairman of the board of Holiday Inns of America Inc., look over plans for a new project in July 1958.

Holiday Inn leaders scout new project / Wallace E. Johnson (left), president, and Kemmons Wilson, chairman of the board of Holiday Inns of America Inc., look over plans for a new project in July 1958.

Kemmons Wilson (Holiday Inn) asserted, “I learned a long time ago that you don’t have to be smart to run a business, but you do have to be smart enough to surround yourself with good people– people with vision, imagination, and determination. In the long run, my success has depended upon service to the consumer and the motivation and enthusiasm of the people in the business itself, from the doorman to the manager.”

The great leaders intuitively knew that one of the biggest challenges to be faced came from selecting and motivating the right employees. Michael Dell (Dell Computer) verified this, when he admitted, “One of the biggest challenges we face today is finding managers who can sense and respond to rapid shifts, people who can process new information very quickly and make decisions in real time. It’s a problem for the computer industry as a whole – and not just for Dell – that the industry’s growth has outpaced its ability to create managers. We tell prospective hires, ‘If you want an environment that is never going to change, don’t come here. This is not the place for you.’”

How great leaders approached identifying and hiring the right employees was as varied as their individual personalities. Ross Perot (EDS) noted, “Over my years in business, I have had a saying when it comes to hiring: Hire character and train skills. Everything worth doing is done on a foundation of integrity and honor.”

Timothy Koogle (Yahoo) shared his insights by explaining, “What we found is that hiring really smart people who have a breadth of knowledge or breadth of interest has been way more beneficial than hiring people with a whole lot of more mainstream media experience, and that means hiring really smart people straight out of school who are broader in their knowledge base and their interest level. And they’re more out of the box than anything else.”

“Microsoft has long hired based on I.Q. and ‘intellectual bandwidth.’ [Bill] Gates is the undisputed ideal: talking to most people is like sipping from a fountain, goes the saying at the company, but with Gates it’s like drinking from a fire hose. Gates, Ballmer and Myhrvold believe it’s better to get a brilliant but untrained young brain—they’re called ‘Bill clones’—than someone with too much experience. The interview process tests not what the applicants know but how well they can process tricky questions: If you wanted to figure out how many times on average you would have to flip the pages of the Manhattan phone book to find a specific name, how would you approach the problem?”

Colin Powell (U.S. Army) emphasized the importance of hiring and retaining the right people, when he noted, “Your best people are those who support your agenda and who deliver the goods. Those people expect more and deserve more, whether those rewards take the form of additional compensation, accolades, career advancement, assignments to plum projects, or personal development opportunities. If they don’t get what they expect and deserve, they become deflated, demotivated, and cynical. Because they’re marketable, they’re the first ones to update their resumes when they’re unhappy. And for organizations competing in today’s knowledge economy, that can be a recipe for disaster.”

  1. Wilson Kemmons, How to Make Your Guests Happy (Business Perspectives, Volume: 12, Issue: 4)
  2. Magretta Joan, The Power of Virtual Integration: An Interview with Dell Computer’s Michael Dell (Harvard Business School Publishing, March-April 1998 v76 n2 p72 (13) )
  3. Remarks by H. Ross Perot upon receiving the Sylvanus Thayer Award West Point – 15 October 2009 (West Point Association of Graduates; http://www.westpointaog.org)
  4. Silicon Valley In-Depth Interviews: Tim Koogle (Business Week, August 7, 1997)
  5. Isaacson Walter, In Search of the Real Bill Gates (Time Magazine, January 13, 1997)
  6. Harari Oren, Leadership Secrets of Colin Powell (McGraw Hill, New York, 2002) p. 25

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.

Related:

If You Put Fences Around People, You Get Sheep

Does Compassion and Empathy Have a Role in Leadership?

Emotional Bonds are a Reflection of a Leader’s Effectiveness

Do You Have Faith in Your People?

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Written by Timothy F. Bednarz, Ph.D.

March 27, 2013 at 10:00 am

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

The Mastery of Details is an Integral Part of Leadership

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Oprah Winfrey  (Photo by Andrew H. Walker/Getty Images)

Oprah Winfrey
(Photo by Andrew H. Walker/Getty Images)

The United States Nuclear Navy has an enviable record for engineering excellence and safety. From its inception in the 1940s, Admiral Hyman Rickover (U.S. Navy) established exacting standards for every aspect of its operation. Not content to remain behind a desk, he was present on the bridge of every newly launched vessel as it underwent its sea trials.

He was truly immersed in the details of each project and every mission, and left nothing to chance. This included interviewing every naval officer before they were allowed into the nuclear program. He stated that, “The man in charge must concern himself with details. If he does not consider them important, neither will his subordinates.

Yet ‘the devil is in the details.’ It is hard and monotonous to pay attention to seemingly minor matters. In my work I probably spend about 99 percent of my time on what others may call petty details. Most managers would rather focus on lofty policy matters. But when the details are ignored, the project fails.

No infusion of policy or lofty ideals can then correct the situation. To maintain proper control one must have simple and direct means to find out what is going on. There are many ways of doing this; all involve constant drudgery.

For this reason those in charge often create ‘management information systems’ designed to extract from the operation the details a busy executive needs to know. Often the process is carried too far. The top official then loses touch with his people and with the work that is actually going on.”

Colin Powell (U.S. Army) noted, “Sometimes details are neglected because they’re not sexy enough… Running anything is primarily an enormous amount of grubby detail work and very little excitement, so deal making is kind of romantic, sexy. That’s why you have deals that make no sense.

Good leaders don’t view details… as grubby. They view the mastery of detail as an integral part of leadership.”

As military leaders, both Rickover and Powell recognized the value of being immersed in details. They understood that in a combat environment, overlooked details can be costly in many ways, especially regarding the lives of the men and women who serve under them. This immersion in detail was also observed in other military leaders, including Robert E. Lee, U.S. Grant and Robert Wood (Sears).

A desire to immerse themselves in details isn’t limited to military leaders. It was observable in the behaviors of other great leaders, including Steve Jobs (Apple), Bill Gates (Microsoft), Elizabeth Arden (Elizabeth Arden), and Estée Lauder (Estée Lauder) to cite a few.

William Boeing (Boeing) began his career in the lumber business before he saw the future of aviation. In addition to Boeing he also created the United Aircraft Corporation and United Airlines as subsidiaries. (The Federal government ultimately broke-up Boeing as a monopoly in 1934.)

As Boeing grew his aviation business, “[he] continued to run his timber business and was able to absorb details of both lumber and airplane enterprises. Years later, he could recall the description and topography of a parcel of land and the species and quality of timber that it would yield. He believed in details and told his managers that many a wrong decision stemmed from a detail overlooked or incorrectly interpreted.”

Another aviation pioneer, Juan Trippe (Pan American Airways) immersed himself in every detail of his emerging business. “When [he] got Pan American Airways into the air in 1927 he knew every wrinkle in its flying equipment (a lone tri-motored Fokker), every part in his stockroom, every wavelet in the go-mile mail route between Key West and Havana.”

When viewed from the perspective of “ruthless efficiency,” the practice of immerging oneself in the details of managing a successful enterprise makes absolute sense. Large and widespread companies by their very nature, creates potential waste and duplication.

This is underscored by a report issued by the U.S. Government Accountability Office in March 2010 entitled, Opportunities to Reduce Potential Duplication in Government Programs, Save Tax Dollars, and Enhance Revenue, which reported wide spread waste and duplication of efforts throughout the Federal government, costing taxpayers up to $200 billion annually.

John D. Rockefeller (Standard Oil) is a notable example. “Of all the lessons John absorbed from his father, perhaps none surpassed in importance that of keeping meticulous accounts… The titan had to know to the last pipe, to the last oil storage tank at each of his refineries, to the last Standard Oil tanker at sea, to the last penny in Standard Oil’s Accounts Receivable, and to the last of whatever else he could think of in his business, where everything was, how the item or person served his purposes, and their exact value.”

Oprah Winfrey (Harpo Productions) openly admits her lack of management acumen. She delegates that aspect of the business to professional managers within her organization. Yet, this does not stop her from immersing herself in the details of her business.

“Everything is personal at Harpo. While Oprah does delegate operational decisions, she is all over her content. Before O gets shipped to the printer, she reads every word and scrutinizes every picture—typically working on the magazine, via her office PC, from 3 P.M. to 8 P.M. Tuesday through Thursday and all day Friday, when she doesn’t shoot her show.

‘She’s into every little… thing, the commas, the exclamation points,’ says Gayle King, who, as editor-at-large, is Oprah’s eyes and ears at the Manhattan-based magazine.”

Winfrey’s attention isn’t just limited to her content. She personally signs all checks and pays close attention to how her money is being spent.

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

Written by Timothy F. Bednarz, Ph.D.

January 2, 2013 at 10:50 am

Leaders Are Judged By The Actions They Take

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Herb-Kelleher - Founder of Southwest AirlinesPhoto by William-Thomas-Cain-Getty-Images

Herb-Kelleher – Founder of Southwest Airlines
Photo by William Thomas Cain-Getty Images

Of all the leaders surveyed, the great ones were individuals who consistently displayed their integrity and character. No matter what happened in their lives: adversity, controversies, failure and defeat, their character shined through. It established deep personal credibility with each of their constituencies, as well as all others that came into contact with them.

First and foremost, leaders are judged by the actions they take. Today’s high profile leaders are prominently visible to all of their key constituencies. They make speeches and presentations to employees, shareholders, financial analysts, and the public in general.

Herb Kelleher (Southwest Airlines) exemplifies this. “He’s totally true to himself and totally consistent between his private life and his public life. He’s totally consistent between his public speeches and his private speeches. You could look at a speech that Herb gave to the annual shareholders meeting of 2002 and compare it to his message to the field in 1992 and compare it to a letter to employees in 1982 and find tremendous consistency in terms of adherence to core values.

So the absolute adherence to extraordinarily high professional principles of ethical conduct and fair dealing, is just remarkable over time. So he built up a reservoir of credibility not only among employees but other people.”[1]

Many leaders may sound impressive, but simultaneously undermine their credibility since their actions fail to mirror their words. In some instances, leaders’ actions contradict their company’s mission statement, resulting in confusion within their organization. In either case, their personal actions become corrosive to the organizational culture, as well as their own individual credibility.

As a high profile leader, Carly Fiorina’s (Hewlett Packard) actions were highly scruntized and undermined her credibility. “Fiorina came in with a mandate of change, but didn’t make any effort to build trust between herself and the company. Indeed, she sullied her image by exalting herself without regard to her employees’ reactions.

Buying a personal jet in front of a distrustful and alienated workforce is one example. Freezing employee salaries while giving herself and her executive ilk bonuses is another. Doing these things in light of nearly 18,000 employee dismissals (2003) is just plain callous.”[2]

Leaders’ actions set the tone for their organization, whether they realize it or not. They can either inspire or generate resentment in their employees. Fred Smith (FedEx) inspired his organization by setting a tone where all his employees felt they could share in the success of the company.

He stated, “One of the biggest principles is that you’ve got to take action. Most large organizations reach a static point. They cannot take any action, because there are all types of barriers to doing so. There are institutionalized barriers that weren’t there when the company was considerably smaller. What changes is your knowledge and your appreciation of how to deal with those institutional barriers, to eliminate them or use them to your advantage in achieving those changes. There are myriad number of changes that have to take place in the management style for the company to continue growing.”[3]

“’Andy [Grove][Intel] has always been a teacher – often by example,’ says Ron Whittier, senior vice president in charge of content development… Yet I don’t think he wants to be remembered as a great visionary – but as someone who made things happen and created a great company.’”[4]

All constituencies expect leaders to be fair, just and consistent. Any perception of cronyism and the use of internal politics to develop an advantage for one individual or group generates unintended consequences, as these policies and actions are replicated at lower levels. Yet, for certain types of leaders, potential gains are too tempting not to employ these practices.

Their focus on personal gain, however, becomes transparent to the rest of the organization. This destroys trust and channels of openness and honesty throughout the company. Fredrick Joseph (Drexel Burnham) created a dysfunctional culture when he ignored the unethical practices and securities violations of high-powered Michael Milken, and his creation of the junk bond business. The insider-trader scandals surrounding Milken ultimately led to the largest bankruptcy in Wall Street history at that time.

These actions hamper leaders’ abilities to instill their ideas, beliefs and values in others, and significantly hinder them when communicating sweeping strategies that are needed to move organizations forward. Rather than unite different factions, they splinter any existing unity, as different groups jockey for position. Leaders in this position typically tend to use their authority and power in a repressive rather than productive manner. It saps the company’s available resources and diminishes its productivity.

A notable and well-publicized example of this practice is Al Dunlap (Sunbeam). “In Dunlap’s presence, knees trembled and stomachs churned. Underlings feared the torrential harangue that Dunlap could unleash at any moment. At his worst, he became viciously profane, even violent. Executives said he would throw papers or furniture, bang his hands on his desk, and shout so ferociously that a manager’s hair would be blown back by the stream of air that rushed from Dunlap’s mouth. “Hair spray day” became a code phrase among execs, signifying a potential tantrum.”[5]

My research of some of the poorest performing leaders substantiated that many also made questionable and highly risky financial decisions that placed their companies at risk, and placed the well being of shareholders far above the interests of their customers.

“In the service of a quick buck, he [Al Dunlap – Sunbeam] imposed brutal pressure on honest people, placing their careers, incomes, health insurance, and pensions at stake. He made impossible, irrational demands that were ruinous to the long-term prosperity of companies. The leadership style he practiced was inconsistent with good business, thoughtful management, a strong economy….”[6]

Jon Huntsman (Huntsman Chemical) observed. “People often offer as an excuse for lying, cheating, and fraud that they were pressured into it by high expectations or that “everyone does it.” Some claim that it is the only way they can keep up. Those excuses sound better than the real reasons they choose the improper course: arrogance, power trips, greed, and lack of backbone, all of which are equal-opportunity afflictions.”[7]

The great leaders were committed to others and demanded excellence from all. They forged building blocks of growth and were proactive as they mastered execution of their plans within all levels of their organization.

They demanded accountability on all levels and did not delegate this responsibility. They held themselves equally accountable, and adhered to the same standards as were established for the lowest level employee. This typically appealed to their personal sense of fairness.

“More than anyone, leaders should welcome being held accountable. Nothing builds confidence in a leader more than a willingness to take responsibility for what happens during his watch. One might add that nothing builds a stronger case for holding employees to a high standard than a boss who holds himself to even higher ones.”[8]

These leaders were passionate, and demonstrated a high level of personal drive and resilience. These factors made it possible to build emotional connections with key constituencies, especially needed during difficult periods.

Finally, one of the most notable distinctions of great leaders was found in their restraint and self-control. It inspired confidence in all key constituencies. A key example of this trait was the composure and stature James Burke (Johnson & Johnson) displayed during the Tylenol scare. His actions are attributed to saving that brand and securing the company’s impeccable reputation.

Related:

  1. Legitimacy: The Sole Basis of Leadership
  2. Does Compassion and Empathy Have a Role in Leadership?
  3. Your Commitment to Others Defines You as a Leader

References:

  1. Yeh Raymond T. with Yeh Stephanie H., The Art of Business: In the Footsteps of Giants (Zero Time Publishing, 2004)
  2. Knufken, Drea, 10 Reasons People Hate Carly Fiorina (Business Pundit) June 18, 2008
  3. Hafner, Katie, Fred Smith: The Entrepreneur Redux (Inc. Magazine, June 1, 1984)
  4. Sheridan John H., 1997 Technology Leader of the Year Andy Grove: Building an Information Age Legacy (Industry Week, April 19-21, 2010)
  5. Byrne, John A., Chainsaw (Harper Business, 1999, 2003) p 353-354
  6. Gallagher Bill, Once a Bum, Always a Bum (Niagara Falls Reporter, January 29, 2002)
  7. Huntsman, Jon M., Winners Never Cheat Even in Difficult Times (Wharton School Publishing, Upper Saddle River, New Jersey, 2008) p 35
  8. Giuliani, Rudolph, Leadership (Hyperion, New York, 2002) p 70

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

Does Compassion and Empathy Have a Role in Leadership?

with 8 comments

William Hewlett and David Packard - Founders of Hewlett-Packard

William Hewlett and David Packard – Founders of Hewlett-Packard

Leaders do have control over the actions, behaviors and decisions that influence and shape their personal credibility. This once again involves self-awareness as well as comprehensive critical thinking abilities to examine the consequences of both their long and short-term actions. All leaders have choices, but the right choices demand a leader’s willingness and acquiescence.

“Bill [William Hewett] and Dave [David Packard] could be gruff and demanding but were seen as compassionate at heart. They agonized over layoffs and, according to company lore, would apologize for angry outbursts. They created one of the most humane workplaces in the United States. The founders also served as models of integrity. HP products were expensive but they were dependable. Wall Street could trust the numbers that Hewlett and Packard presented to analysts.”[1]

My research substantiates that the great leaders were compassionate and displayed empathy. There is a story about George Westinghouse (Westinghouse Electric) conducting a tour of his factories with visitors. In the course of the tour, the group observed a young man stumbling and falling while carrying a large copper plate. As the group laughed at the young man’s predicament, Westinghouse walked over and in his business suit, kneeled down and assisted the young man.

Herb Kelleher (Southwest Airlines) has fostered compassion and empathy within his company. He took a personal interest in even the smallest events of his employees’ lives. Using their own initiative, his employees have in turn, routinely used voluntary payroll deductions to assist fellow employees with serious financial problems such as terminal illnesses.

In the quest for ever-increasing shareholder value, many contemporary leaders perceive empathy and compassion as a sign of personal weakness. Quite to the contrary, my research proves that the great leaders, especially those who were compassionate, were also strong leaders. There was nothing weak about them and their compassion and humanity didn’t diminish their performance. Most times it enhanced it.

An additional benefit the research revealed was that strong levels of compassion and empathy result in strong levels of trust and loyalty. Rather than diminishing shareholder value, the great leaders typically outperformed their competition.

Howard Schultz (Starbucks) “explains how [employee] meetings help him lead a fast-growing $ 6.4 billion global company with 90,000 employees, 9,700 stores, and 33 million weekly customers. ‘People aren’t interested in how much you know… It’s how much you care.’”[2]

Jack Welch (General Electric) noted the value of a compassionate leader, when he said, “If you have everything else you need in terms of talent and skill, your humanity will come to be your most appealing virtue to an organization.

Your team and your bosses will know who you are in your soul, what kind of people you attract, and what kind of performance you want from everyone. Your realness will make you accessible; you will connect and you will inspire. You will lead.”[3]

Related:

  1. Legitimacy: The Sole Basis of Leadership
  2. Your Commitment to Others Defines You as a Leader
  3. Emotional Bonds are a Reflection of a Leader’s Effectiveness

Reference:

  1. Johnson Craig, The Rise and Fall of Carly Fiorina: An Ethical Case Study (Journal of Leadership & Organizational Studies, November 2008)
  2. Meyers, William, Conscious in a Cup, (U.S. News & World Report) October 31, 2005
  3. Welch Jack, Get Real, Get Ahead (Business Week) July 23, 2007

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)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

Written by Timothy F. Bednarz, Ph.D.

December 6, 2012 at 10:22 am

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