The Leadership Engine

Last week I wrote about Noel Tichy and his book The Leadership Engine. I am such of fan of Tichy's work that I thought we might continue the conversation.

In doing a little bit of research for last week's post, I came across a book report written about The Leadership Engine. The book report written by P. Bala Bhaskaran a professor of business in Gujarat, India.

There are a few grammatical errors, in the report, but that's ok. Understandably, English is not Professor Bhaskaran's first language. Enjoy.

Introduction

Man's concern with the art and science of leadership is as old as mankind itself. It has attracted many thinkers. Noel M. Tichy and Eli Cohen have studied a large number of successful leaders in the context of their winning organizations and have come out with a set of observations that mark the alchemy of winning leadership. According to them winning is all about leadership; winning individuals are essentially leaders. They are people with ideas, values, energy and guts to do what needs to be done. Winning companies value leaders; they have cultures that expect and reward leaders; these organizations actively invest time and resources into developing leadership. Winning organizations win because they have lots of leaders; they have lots of leaders because they systematically nurture them. The line that separates winning organizations from others is the formers' ability to create leadership at every level. In every winning company leading and teaching goes hand in hand. These organizations are generally net exporters of leadership talent.

Leadership and its relevance to organizations

Winning can be described as adding value to the customers and sustaining excellence. For commercial organizations, this can be gauged by the continued track record of excellence on the capital market; for non-profit organizations, we have to look at the increasing impact of the organization on increasing number of people. Winning organizations are those that reinvent themselves continuously to add value to the customers. Winning organizations have been more effective in teaching leadership. The authors' observations are that in these organizations:

- proven leaders do the teaching.

- the leaders are avid learners.

- The leaders tend to possess: ideas, values, energy, emotions and edge.

Why are leaders relevant or important to the organizations? In a competitive environment, organizations need leaders who can determine the direct; who can redirect the organizational energies. They are the people who decide what needs to be done; they make things happen in the desired direction. For organizations to be winning and effective, regular supply of leaders is essential. This is the story of any organization that has been winning, surviving and growing over long periods.

A leader is successful only if he is able to develop others to be leaders. If he does not oversee the leadership development closely, the process would not be effective and the organization would not be sustained. Great leaders accomplish their goals through their followers; they teach their followers to be leaders. The leaders develop their teachable point of view through clear ideas and values based on their knowledge and experience; not on borrowed ideas and values. Citing rear Admiral Chuck Lemoyne who taught special warfare, the authors observe, “...the real goal of the preparation, therefore, is not to give people proficiency in the latest warfare technology. It is to create leaders, men and women who will react with the right instincts in hostile, confusing and unpredictable environments.” Leading goes along with teaching.

The saying that extraordinary leaders are created by extraordinary circumstances is a myth according to the authors. Every body has a past. Extraordinary people visit them frequently for inspiration and craft them into useable stories. Ordinary people either do not visit them or are not able to find inspiration from them. We read about Tim Teller (CEO of Polaris) or Gary Wendt (CEO of GE Cap) or many others who got inspired from their early experiences and built their leadership. These leaders have been able to build their greatness based on their experiences. Many others, ordinary people, just did not do it.

The authors have come up with a model of winning leadership called the Leader's Teachable Point of View where the primary elements are Ideas, Values, emotional Energy and Edge. Most of the book dwells on this model.

Ideas: The Heart of Leadership

The heart of leadership is Ideas. Winning organizations are built on clear ideas. A classic example is Nike. Nike is the Greek Goddess of Victory. Phil Knight, the founder, articulated that his organization stood for the victory of the athletes; he made his organization synonymous with the athletes’ victory. This articulation served as an organizing and guiding principle for all its activities; this has propelled the growth and success of the organization Ideas serve as building blocks for the organization

Ideas serve as energizers. They are essential tools in motivating people. In 1961 John F. Kennedy declared that America would like to put a man on the moon in about ten years. This became the driving force, the energizer, for NASA to plan all its activities; it became the driving force for all the personnel in NASA to engage their minds and open up new creative possibilities and alternatives. Finally America put a man (Neil Armstrong) on the moon in less than a decade in 1969.

Leadership is about creating such ideas. The ideas need to be current and relevant in the context of the external market situation. In creating an idea one has to think of the unthinkable and literally use everything that he has around him.

Values: The Touchstone of Social Relevance

After ideas the next major building block is values. Morals and values have always been the cornerstones of society; Moses, Jesus, Gandhi and Martin Luther King Jr. are examples to this. Winning leaders, invariably, recognize the significance of having corporate values that support and sustain the organization’s goals and making sure that everyone in the organization understands and lives by them. They

- Clearly articulate a set of values for the entire organization

- continually reflect on the values to make sure that they are appropriate to achieving the desired goal

- They embody the values with their own behavior

- They encourage others to apply the values in their own decisions and actions.

- They aggressively confront and deal with pockets of ignorance and resistance.

Winning leaders also ensure that with changes in technology and markets, the ideas and values continue to be appropriate. One of the basic differences between winning organizations and others is that the winning leaders live the values and they make every one else do the same. They help everyone internalize the values through day-to-day activities and through every process and act of the organization Having created a value system unique to the organization, it becomes a competitive tool; the values take root as the fabric of the corporate culture and they provide a tangible base for the growth and sustenance of the organization

Changing people’s values is harder than changing their ideas, but in the long run, this becomes essential. Restructuring the businesses, the organization etc are much simpler compared to changing the values of the people. For any change to be effective, leaders need to reorient the values that guide people’s actions. True leaders can see the writings on the wall, they can see the big picture, can change their mind and mindsets and help others do the same.

Emotional Energy: The cementing force

Organizations have energy because they are made up of people and people have energy. Winning leaders understand this; they help nurture positive energy, direct it to creative channels, use energy as a competitive tool. Winning leaders are invariable highly energetic: they work longer, harder and they love doing that. Their high energy, both physical and emotional, excites and energizes everyone.

Winning leaders use the operating systems, like meetings, communication channels etc, innovatively to create positive emotional energy. They seek ideas, plant ideas, seek involvement, enable decision making and generally empower the people around them. They are able to transform negative energy into positive channels. They do this by creating situations and conditions, which the authors list as below:

- a sense of urgency

- an inspiring mission

- a set of goals that stretch people’s capabilities

- Spirit of teamwork - “we are in it together”

- A realistic expectation that the team members achieve the goals

Winning leaders are experts in visualizing the possibilities in every situation, in terms of short-term and long-term impacts. They have immense energies of their own; using these they inspire others to dream and conjure up new possibilities, to rupture the existing paradigms and they lead them to newer horizons.

Edge: The differentiator

Edge is the ability to take tough decisions; it is the ability to sacrifice a comfortable present for the sake of a better future. Edge manifests in two major factors: first is the immense drive to seek the truth which will be the basis for decision making; second is the courage to take decisions. Edge is about having courage of convictions, of refusing to let difficulties stand in the way, of having principles and standing up for them.

Edge is observed in different categories of situations. In business related situations edge is about abandoning the existing business line to choose another, it is about adopting a new portfolio and the like. In people related situations, it is about assessing people and giving them a tough feedback and perhaps even firing them. Jack Welch came up with a 2 X 2 matrix on people. He looked at the ability of the person in accepting and adopting the values of the organization on one dimension and his performance on the other dimension. The resulting matrix is assessed as four types of people.

Type	Values	Performance	Prescription
1	Hi	Hi	Encourage and nurture
2	Lo	Lo	Must go
3	Hi	Lo	Give them another chance
4	Lo	Hi	OK in the short-run; but in the long-run not suitable

Winning leaders would have a high sense of the reality, they respect others, they go to great lengths to explain their position to others and they also inspire others by their tough decisions and actions. Such leaders are respected by superiors and subordinates alike. It is a fact that people like their leaders to be strong and action-oriented.

It is desirable to develop edge in every employee so that each becomes a leader eventually. Leadership scholars like Abraham Zaleznik, Eric Ericson, John Gardner and James McGregor Burns have written about early hardships in life and their impacts on character. Those who have come through hardships and sacrifices tend to develop self-confidence and self-reliance. Such persons find it easier to make tough decisions. In most professions and organizations people are put through progressively more difficult situations. This is meant to enhance their capability and competence to manage. This is the most common form of developing edge.

Conclusion

Winning leaders combine ideas, values, emotional energy and edge innovatively to achieve transformation in the organization Very often this is initiated through stories woven by the leaders; these stories reflect the following basic elements

- the case for change

- where we are going

- how we will get there

Stories are found to be powerful tools in involving people emotionally and intellectually. Leaders bind people together through these stories, energize them and lead them into the future.

The book concludes that winning leadership is about building for the future. In the short-run, the leaders prepare the organization to respond to changes; in the long-run, they create organizations that can sustain success. Organization becomes successful when it has large number of leaders. Legacy of a winning leader is creation of many leaders. Good leader take care to plan their succession systematically and leave the scene in a phased manner.

Control the Crazy

One thing I have noticed, over time, is that successful people are emotional. Show me a super successful person and I will show you a super emotional person. I don't think you can have one without the other.

At first glance, you might not notice that a successful person is emotional. He or she may have learned ways to cope with their emotions. Or, they might simply be covering them up. The first president of the United States, George Washington, is a good example of covering up emotions. Washington was a man of intense emotions. And, the way he concealed his emotions was with a staid, almost statuesque demeanor. He had what we might call a poker face.

More often than a cover-up successful people learn to cope with their emotions. That is to say they learn to either channel their emotions to productive use or they know how to adjust their lives to deal with the ebbs and flows. Abraham Lincoln would be a great example here. Lincoln was prone to bouts of serious depression. But, that didn't stop him from becoming the closest thing to royalty that America has ever produced.

Of course, I intentionally draw attention to Lincoln and Washington because they are, arguably, the two most successful presidents in the history of the United States. Like I said a minute again, show me a super successful person and I'll show you a super emotional person. This is something I have learned observationally. But, it is a concept that has also been codified academically.

Noel Tichy is an interesting guy. Tichy is a professor at the University of Michigan's Ross School of Business. The area he is probably best known for is leadership. Have you ever read any of professor Tichy's books? They're great. Jack Welch even selected Noel to lead General Electric's Leadership Center in Crotonville, New York.

Many years ago Professor Tichy wrote one of the landmark books in the study of leadership. The book is titled The Leadership Engine and, if you haven't already, I encourage you to read it. In the modern age, it's more than just a quaint idea that each of us needs to be a leader. And, leadership is an interesting thing in that it doesn't operate under the laws of scarcity or elasticity. Meaning, it is not a limited resource. The more leadership, the better.

According to Tichy one of the key elements to effective leadership is emotional energy. Speaking of what he calls, “Winning leaders,” in The Leadership Engine, he writes, “It is their emotional energy, and their ability to evoke emotional energy in others, that truly marks them as a breed apart.” So, not only do effective leaders have lots of emotional energy, they also rev other people up as well. All the more reason to be good with emotions.

The question then becomes, how do we learn to cope with our emotions? I think it's a good question. In however small a way, I hope this blog helps. But, of course, there are fair better experts, out there, than I. Since I am mentioned a landmark book I might as well bring up one more. Some years ago Daniel Goleman wrote a really important book titled Emotional Intelligence. In the book, Goleman suggests that an ability to handle emotions, what he would refer to as EQ, might be more important than IQ.

I think Goleman is on to something. And, this is a really important idea because we live in a country that praises the Intelligence Quotient. People are always curious what their IQ is. But, few pay attention to their EQ, though that is changing. And, again, the EQ might be more important. I wrote a overview of Goleman's book and you can find it here: on EQ

Emotions are a complicated subject. And, I do not profess to be the authority. But, I do know a fair amount and I would like to pass it along. The reason being, as I have tried to illustrate, emotions are extremely important. Indeed, they are more fundamental than intelligence.

If you read my book report, about Goleman's book, you will see how I make an example of really smart people whose emotions are out of control. Some people even pride themselves on not having emotions. That TV show The Big Bang Theory does an outstanding job of depicting uber-smart people who are emotionally retarded.

When we are ignorant of a subject we often fear it or call it crazy. A lot of us don't understand emotions so we think they are crazy. The fact is, a lot of people label emotional behavior as crazy behavior. But, it's not crazy. We simply do not understand it.

An interesting thing to consider is what it takes to be super successful. By definition success lies outside of our comfort zone. The average person would prefer to do what's reasonable. And, that's why the average person is average. Super success requires being unreasonable. Indeed, even irrational. And, emotional thinking is often irrational. I believe that learning to manage irrationality is critically important if we wish to be all that we can be.

And, that's what really matters. In this post I have repeatedly used the word “successful” because it's a simple word that we are all familiar with. But, as we know, success means different things to different people. I think one good definition of success is to reach our full potential. To become all that we are capable of. And, in doing so, we will run right smack into a lot of emotionality.

Like Steve Jobs said, “Here's to the crazy ones...”

Leadership as Work

I don't know about you but I am interested in the concept of leadership. There are all sorts of books, and articles, on the subject. Some are good. Others, not so much. What I have found is that some people, who claim to be leadership experts, are really just experts at self-promotion.

What's more, a lot of people draw a artificial distinction between leadership and management. As we know, business is about people. And, it's essentially impossible to manage people. If they wish to be effective, managers really have no choice but to lead. Not surprisingly, the person who has the best hold on what it means to be a leader is the man who invented management.

That man would be Peter Drucker. And, a few years ago, Drucker wrote an outstanding article on leadership. Being that the article is only 1100 words, I thought I would pass it along, to you, in its entirety.

Leadership is a very complicated subject. And, Peter was that rare individual who could distill a complex subject down to its essence. What's even more fun is his witty ability to do things like incorporate the metaphorical dead fish. Check it out!

Here is the article in full:

Leadership is all the rage just now. “We'd want you to run a seminar for us on how one acquires charisma,” the human-resources VP of a big bank said to me on the telephone–in dead earnest.

Books, articles, and conferences on leadership and on the “qualities” of a leader abound. Every CEO, it seems, has to be made to look like a dashing Confederate cavalry general or a boardroom Elvis Presley.

Leadership does matter, of course. But, alas, it is something different from what is now touted under this label. It has little to do with “leadership qualities” and even less to do with “charisma.” It is mundane, unromantic, and boring. Its essence is performance.

In the first place, leadership is not by itself good or desirable. Leadership is a means. Leadership to what end is thus the crucial question.

History knows no more charismatic leaders than this century's triad of Stalin, Hitler, and Mao–the misleaders who inflicted as much evil and suffering on humanity as have ever been recorded.

But effective leadership doesn't depend on charisma. Dwight Eisenhower, George Marshall, and Harry Truman were singularly effective leaders, yet none possessed any more charisma than a dead mackerel. Nor did Konrad Adenauer, the chancellor who rebuilt West Germany after World War II. No less charismatic personality could be imagined than Abe Lincoln of Illinois, the raw-boned, uncouth backwoodsman of 1860. And there was amazingly little charisma to the bitter, defeated, almost broken Churchill of the interwar years; what mattered was that he turned out in the end to have been right.

Indeed, charisma becomes the undoing of leaders. It makes them inflexible, convinced of the own infallibility, unable to change. This is what happened to Stalin, Hitler, and Mao, and it is a commonplace in the study of ancient history that only Alexander the Great's early death saved him from becoming an ineffectual failure.

Indeed, charisma does not by itself guarantee effectiveness as a leader. John F. Kennedy may have been the most charismatic person to ever occupy the White House. Yet few presidents got as little done.

Nor are there anything such things as “leadership qualities” or a “leadership personality.” Franklin D. Roosevelt, Winston Churchill, George Marshall, Dwight Eisenhower, Bernard Montgomery, and Douglas MacArthur were all highly effective–and highly visible–leaders during World War II. No two of them shared any “personality traits” or any “qualities.”

Work, Responsibility, and Trust Earned

What then is leadership if it is not charisma and not a set of personality traits? The first thing to say about it is that it is work–something stressed again and again by the most charismatic leaders: Julius Caesar, for instance, or General MacArthur and Field Marshall Montgomery, or, to use an example from business, Alfred Sloan, the man who built and led General Motors from 1920 to 1955.

The foundation of effective leadership is thinking through the organization's mission, defining it, and establishing it, clearly and visibly. The leader sets the goals, sets the priorities, and sets and maintains the standards. He makes compromises, of course; indeed, effective leaders are painfully aware that they are not in control of the universe. (Only misleaders–the Stalins, Hitlers, Maos–suffer from that delusion.) But before accepting a compromise, the effective leader has thought through what is right and desirable. The leader's first task is to be the trumpet that sounds a clear sound.

What distinguishes the leader from the misleader are his goals. Whether the compromise he makes with the constraints of reality–which may involve political, economic, financial, or interpersonal problems–are compatible with his mission and goals or lead away from them determines whether he is an effective leader. And whether he holds fast to a few basic standards (exemplifying them in his own conduct), or whether “standards” from him are what he can get away with, determines whether the leader has followers or only hypocritical time-servers.

The second requirement is that the leader see leadership as responsibility rather than as rank and privilege. Effective leaders are rarely “permissive.” But when things go wrong–and they always do–they do not blame others. If Winston Churchill is an example of leadership through clearly defining mission and goals, General George Marshall, America's chief of staff in World War II, is an example of leadership through responsibility. Harry Truman's folksy “The buck stops here” is still as good a definition as any.

But precisely because an effective leader knows that he, and no one else, is ultimately responsible, he is not afraid of strength in associates and subordinates. Misleaders are; they always go in for purges. But an effective leader wants strong associates; he encourages them, pushes them, indeed glories in them. Because he holds himself ultimately responsible for the mistakes of his associates and subordinates, he also sees the triumphs of his associates and subordinates as his triumphs, rather than as threats. A leader may be personally vain–as General MacArthur was to an almost pathological degree. Or he may be personally humble–both Lincoln and Truman were so almost to the point of having inferiority complexes. But all three wanted able, independent, self-assured people around them; they encouraged their associates and subordinates, praising and promoting them. So did a very different person: Dwight “Ike” Eisenhower, when supreme commander in Europe.

An effective leader knows, of course, that there is a risk: able people tend to be ambitious. But he realizes that it is a much smaller risk than to be served by mediocrity. He also knows that the gravest indictment of a leader is for the organization to collapse as soon as he leaves or dies, as happened in Russia the moment Stalin died and as happens all too often in companies. An effective leader knows that the ultimate task of leadership is to create human energies and human vision.

The final requirement of effective leadership is to earn trust. Otherwise, there won't be any followers–and the only definition of a leader is someone who has followers. To trust a leader, it is not necessary to like him. Nor is it necessary to agree with him. Trust is the conviction that the leader means what he says. It is a belief in something very old-fashioned, called “integrity.” A leader's actions and a leader;s professed beliefs must be congruent, or at least compatible. Effective leadership–and again this is very old wisdom–is not based on being clever; it is based primarily on being consistent.

After I said these things on the telephone to the bank's human-resources VP, there was along silence. Finally she said, “But that's no different at all from what we have known for years are the requirements for being an effective manager.”

Precisely.

A Ralph Lauren Paradox

I think it's fun to be a tight-rope walker. Walking a tight-rope provides perpetual challenge. This is important. I'm sure we have all heard about the “mid-life crisis” and the “burnout” that people experience. Peter Drucker would say this is a subject that is widely misunderstood.

According to Drucker, the mid-life crisis is really just boredom. It occurs when a person has reached the pinnacle of their profession. This person has mastered his or her craft and has little else to learn. A key element of engagement is learning. When a person stops learning they tend to disengage.

We see this everywhere, from reality shows, to our significant others. When we are learning new things, about our significant other, we tend to be more engaged. Obviously, this happens most in the beginning of the relationship. However, when we start to finish their sentences, we can get bored. For this reason it is usually advisable for couples to make the effort to discover and learn new things. The process of discovery is very engaging.

The same phenomenon seems to occur with reality shows. The first season can be great because we are learning about the cast members. The second season might be entertaining as well, as we further peel back the onion. But, usually, reality shows tend to jump the shark in their third season. By this time we have essentially learned all we need to know. We become bored. This is when the producers grab hold of the story and start to engineer the plot. Things become visibly contrived because most reality stars are not very good actors. Thus, the scripting really starts to show through.

At any rate, back to boredom. A big part of the reason I am so enamored with paradoxes is the simple fact that they are endlessly entertaining. I just don't seem to ever get bored discovering a paradox. That said, I want to talk a little about Ralph Lauren, the fashion designer.

Talking about his craft, Lauren once said, “It is important to preserve your lineage and tradition in your line, but the world changes around you and you have to stay with it.” The challenge for Lauren, and all of us, is to preserve the past while simultaneously embracing the future. Not at an easy thing to do. The key is to always be learning and studying. Lauren is a man of profound knowledge. And, I believe, it is this knowledge, and insight, that has kept him on top for so long. Lauren always has something new to learn. He does not appear to be bored.

Lauren's situation is a delicate balancing act. Not unlike walking a tight rope. The question is this. How do we preserve the past while simultaneously evolving into the future? I think it's a brilliant question. I believe the question provides us an excellent riddle. And, ultimately, this riddle is unsolvable. But the point of the riddle is to be answered and not solved. Ha! Answered but not solved? That alone is a riddle. What it means is that there is no final answer on how we preserve the past while simultaneously evolving into the future. The answer itself is an ever-evolving one.

Speaking of questions that are meant to be answered over and over again, check out this post: How about you?

Ok. Let me try to tie this thing together because I have jumped all over the place. What am I saying? I am saying human beings are designed to be learning machines. We experience positive affect (joy) when we learn new things. For this reason I believe it is a very good idea to be a lifelong student. Be honest, you enjoy learning new things, don't you? Even if it's just the latest gossip, we love learning. So, the question then becomes, what should we be studying? Well, that's for you to figure out.

One option is to study all sorts of different subjects. To some extent, that works. Knowing a little bit about a lot of things can be fulfilling. The problem is that humans are also designed to make progress. We are engineered to achieve. How do I know that? Because, just like how we enjoy learning new things, we also experience joy when we accomplish our goals. And, the bigger the goal, the greater the joy. So, if we hope to also cash-in on the joy of big achievement we will need to stick with a one subject long enough to win.

Ralph Lauren scaled to great heights because he stuck to the knitting. He started his company in 1967 and he stuck with it. To stave off boredom he kept on learning. And, if you don't go for breadth of knowledge, you must go for depth. Lauren developed deep and profound knowledge. A key element to massive achievement.

This is where the paradox enters the scene. It is nearly impossible to dive into deep knowledge without encountering numerous paradoxes. What Lauren discovered was that he needed to preserve his uniqueness style while also staying with the spirit of the times. This is the fundamental paradox that all great fashion designers must solve. How do you simultaneously follow and lead? What a delicious pisser.

So, what is your paradox?