Excellence Leadership

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ExcellenceL E A D E R S H I P

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

PHILGELDART

Execution ExcellenceThink strategically andexecute effectively. . . . . . . 3

MICHAELSTALLARDANDJASONPANKAU

Connection CulturesLeaders create them byinspiring identity. . . . . . . .4

JOSEPHGRENNY

Expand InfluenceMake conversation safeand motivating. . . . . . . . . 5

CHIPCONLEY

Peak ExperienceGet your relationalmojo from Maslow. . . . . . .6

JAMESM. KOUZES ANDBARRYZ. POSNER

Credibility

Behave in ways that

build your credibility. . . . .7

JAMESK. DITTMAR,KENNETHR. JENNINGS,ANDJOHNSTAHL-WERT

Trust and EngagementAssume responsibility forworker engagement. . . . . 8

GARYHARPST

Six DisciplinesPut in place your own

excellence program. . . . . .8

DIANNABOOHER

Cues, Clues, and PropsOwn up to your mistakeswhen you miss cues. . . . . 9

JOSEPHW. BERKERY

Leadership ExcellenceGreat leaders shareseven characteristics. . . . 10

STEVENFEINBERG

See PossibilitiesShift to vantage pointsto see advantages. . . . . . .11

HOWARDM. GUTTMAN

Moments of TruthTeam members hold theirleaders accountable. . . . .12

MARCEFFRON ANDMIRIAMORT

Pool or PuddleIs there talent in yourtalent management? . . . .13

DAVIDFINEGOLD

Advanced TMA paucity of strategic HRleaders will increase. . . . 14

DANHILL

EmotionomicsAssess emotional states. .15

ANGELAHILLS

Leading InnovationReward for failure aswell as success. . . . . . . . .16

JAMESM. KILTS

Selecting LeadersFive factors predictselection success. . . . . . . 17

STEPHENPARKER

Effective LDSix pitfalls lead to thedownfall of programs. . .18

CINDYTONKIN

Shift PerspectivesDiscover multipleperspectives. . . . . . . . . . . .19

GRAHAMKENNY

Strategy ScorecardMeasure outcomesand strategy. . . . . . . . . . . 20

VOL. 24 NO. 11 AUST RALIA EDIT IO N NOVEMB ER 2007

Execution Excellence

Swinging right along in any

leadership position will bring

a smile to the face of even a

"bad egg." As we watch aHumpty Dumpty leader

joyfully flying high into

the sky, we can only hope

that this time both he and

we can hang on for dear life.


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IRECENTLY LISTENED TO A SPEECH

by a friend and leadershipmentor, Dallin H. Oaks, nowa member of the Quorum of

the Twelve Apostles of The Church of JesusChrist of Latter-day Saints. He spoke of theconundrum of having more things expectedof us than we can possibly do.

He suggested that just because some-thing isgood is not sufficient reason fordoing it. The number of things we can dofar exceeds the time available to accomplishthem. As we consider various choices, weshould remember that it is not enough thatsomething isgood. Some things are better

than good, and still others are best, andthese are the things that should commandpriority attention. Even though a particularoption may cost more, its far greater valuemay make it the best choice. Limited timeand resources dont allow us to do every

good thing. We need to evaluate its potentialforgood, better, and best and put our prioritytime and best efforts into those things thatwill produce the more desired end results.

As I rank the best minds on leadership, I re-flect on this notion, I recognize that best maybe in the eye (or ear) of the beholder.

Eight CriteriaWhat does it take today to be considered

a top thought leader in the field of leader-ship? Well, I can say this: much more than itdid 24 years ago when we launched

Leadership Excellence. As Tom Peters recentlybemoaned, Its tough being a guru today.

Indeed, the standards and expectations

keep rising, as do the number of practition-ers. The old qualificationsa pulse andPh.D., a business card and book, an ego andoutgoing nature, a sales pitch and speech, asolution looking for a problem, and a need(greed) to be rich and recognizedhavemostly given way to a new set of qualifiers.

The gurus who make our Excellence 100list today possess a rare combination of traitsand abilities. Here are the eight criteria:

1. Preparation: academic and profession-al preparation.

2. Character: values, ethics, beliefs, pur-pose, mission, integrity, walk the talk.

3. Principles:big message, point of view,tenets, main points.

4. Personality: charisma, style, originali-ty, authenticity, one of a kind.

5. Performance: inspiring action, real-world performance, work ethic.

6. Experience:beyond local and regional,more national and international.

7. Expression: substance and style in writ-ing, speaking, coaching, consulting, mentor-ing, training, or teaching.

8. Influence: difference, results, change,transformation.

The Top 100 Thought LeadersFor 24 years, weve published the best

minds on leadership around a SevenDimension Model. Heres our 2007 listing ofthe Top 100 thought leaders on leadership:

W h o a r e t h e t o p 10 0 t h o u g h t l e a d e r s ?

by Ken Shelton

Leadership Excellence (ISSN 8756-2308)is published monthly by:Executive Excellence Publishing1806 North 1120 WestProvo, Utah 84604.Circulation:[email protected] Address: www.eep.com

Editor: Bruce MillsAssociate Director, Marketing: Yvonne DobsonCustomer Relations Manager: Jackie Hutson

LexisNexis ButterworthsLocked Bag 2222Chatswood Delivery CentreChatswoodNSW 2067 AUSTRALIATelephone: (02) 9422 2222Facsimile: (02) 9422 2404

E-mail: [email protected]

Article Reprints: available upon request

Contributing Editors:Chip Bell, Dianna Booher, Kevin Cashman,Jim Loehr, Norm Smallwood, Joel Barker, JosephGrenny, Jim Kouzes

Executive Excellence Publishing:Ken Shelton, Editor-in-Chief, CEOSean Beck, Circulation ManagerGeoff Pace, Sales ManagerNancy Low, Business ManagerAllan Jensen, Chief Information Officer

The table of contents art is a detail fromHumpty Dumpty Sat on a Swing(image cropped) Scott Gustafson, and is courtesy of theartist and art print publisher GreenwichWorkshop.

For additional information on artwork byScott Gustafson, please contact:Greenwich Workshop151 Main StreetSaymour, CT 064831-800-243-4246www.greenwichworkshop.com

Full view of cover art.

Copyright 2007 Executive Excellence Publishing. Nopart of this publication may be reproduced or transmit-

ted without written permission from the publisher.Quotations must be credited.

Best Minds on Leadership

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

2 L e a d e r s h i p E x c e l l e n c e

1. Gary Hamel2. Dave Ulrich

3. James Collins

4. Warren Bennis

5. Tom Peters

6. Barbara Kellerman

7. James Kouzes

8. John P. Kotter

9. Marshall Goldsmith

10. Noel Tichy

11. Clayton Christensen

12. Peter Block

13. Kevin Cashman

14. Jack Zenger

15. Ram Charan

16. Peter Senge

17. James Loehr

18. Michael Porter

19. Marcus Buckingham

20. Meg Wheatley

21. Norm Smallwood

22. Bill George23. James O'Toole

24. Max Bazerman

25. Jay Conger

26. C.K. Prahalad

27. Ichak Adizes

28. William C.Miller

29. Rosabeth Kanter

30. Gifford Pinchot

31. Carly Fiorina

32. Bill Isaacs

33. Nicholas Negraponte

34. Morgan McCall, Jr.

35. Jay Conrad Levinson

36. Michael Treacy

37. Kevin/Jackie Freiberg

38. Jack Welch

39. James Champy

40. Rob Lebow

41. Chip Bell

42. Dan Goleman

43. Renee Mauborgne

44. Beverly Kaye45. Jeff Snipes

46. Ken Blanchard

47. Eileen McDargh

48. Nathaniel Branden

49. David Allen

50. Judith Glaser

51. David Nadler

52. Phil Geldart

53. Libby Sartain

54. Barry Conchie

55. Nigel Nicholson

56. Bill Byham

57. Ed Lawler

58. Charles Garfield

59. Josh Bersin

60. Joseph Grenny

61. Jon Katzenbach

62. Richard Chang

63. Michael G. Winston

64. Joel Barker

65. Frances Hesselbein

66. Karl Albrecht67. Malcolm Gladwell

68. Patrick Lencioni

69. Andre Martin

70. Michael Hammer

71. Edgar Schein

72. Lois Zachary

73. Spencer Johnson

74. Christopher Rice

75. Barry Posner

76. Michael Feiner

77. Ira Chaleff

78. Jeff Sonnenfeld

79. Anne Mulcahy

80. Tom Crum

81. James Cabrera

82. Michael Quigley

83. Vijay Govindarajan

84. Dianna Booher

85. Larry Bossidy

86. Lance Secretan

87. Robert Kaplan

88. Dede Henley89. Ian Mitroff

90. Bill Adams

91. Stephen R. Covey

92. Phil Harkins

93. Terry Bacon

94. Joseph Jaworski

95. Rudy Giuliani

96. Richard Leider

97. Richard Whiteley

98. Stephen Smith

99. Brian Tracy

100.Ken Shelton

EXCELLENCE

LEADERSHIP

THE

Excellenc

e

100Excellenc

e

100
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to do it). World-class leaders of sterlingquality are equally strong in both areas.And in effective organizations, indi-

viduals are correctly positioned alongthe sterling silver cord so that their rela-tive strengths in strategy or tactics aremost effectively used daily.

Five Categories

The first step toward ensuringstrength at both the strategic and tacti-cal level is to analyze the current posi-tion in five categories:

1. Strong conceptualizers and goodstrategic thinkers have trouble execut-ing consistently with predictable results.They have a well-defined position at the

strategic end of the cord but little sub-stance at the other. They require streng-thening at the tactical end.

2. Strong strategic thinkers, whileunable to implement effectively, appre-ciate the consequences of the tacticalimplementation. They can modify thestrategies, reflect the realities of the mar-ketplace, and bring a more pragmaticapproach to their strategic thinking.

3. Strong tacticians appreciate theway tactical activities support the im-plementation of the strategy. They canproactively modify their behavior at thetactical level, by degree, when they see

that there is a better way to deliver thestrategy. They take initiative in makingchanges in day-to-day operations toimprove efficiency and productivity.They see clearly what is to be done atthe end, and at all points in between.

4. Strong tacticians who consistentlydeliver the current priorities but cant

provide clear and motivating directionto others. They have little understand-ing of the strategic framework. Theyneed to develop their ability to see andshape the broader context.

Execution Excellence

THE STERLING SILVERCord is the vital

connection betweenthe ability to think strategically and toexecute effectively.

Strategic skills are crucial to formu-late policy, establish direction, anddetermine how resources should bemost effectively allocated in order toachieve the larger vision. Strategicthinking skills are important whenmaking broad decisions in terms oftime (5 to 10 years out);product (whichareas receive the greatest concentra-

tion); and impact (what do we wish toachieve using our time and money).

Tactical skills put feet to theplan. Clear vision and thinking(strategic skills) are important butwithout good tactical skills, the bene-fits of visionary thinking wont berealized, and will slowly dissipate asso many dreams. Strong tactical skillsenable people to understand theobjective and break it down into oper-ational pieces. These can then beplanned for, have resources allocated,and have clear steps outlined that

need to be taken to achieve specificresults. Tactical skills look at theimmediate details, additional detailsaround the corner, and details onthe horizon. With good tactical skills,you can realize what can and cannotbe done in any context and thus uti-lize the available talent in the resourcepool to maximum effectiveness.

Clearly, if a person is strong in bothareas, there is a huge benefit: the strate-gic thinking takes into considerationthe tactical realities, and the tacticalrealities are driven by the strategic

plan. This person can make decisionsalong the execution path withoutendangering the attainment of the finalobjective. Great leaders who masterboth skills can be said to be of sterlingquality, with the sterling silver cordjoin-ing the strategic and tactical skills con-sistently strong along its entire length.Their leadership at any point alongthat cord is maximally effective.

People tend to have strength eitheron the strategic end (knowing what todo) or on the tactical end (knowing how

5. The sterling leader who has mas-tery of both the strategy and tacticsand everything in between. These high-potentials have demonstrated strengthon both the conceptual strategy side (inknowing what to do) and on the tacti-cal side (in being involved in the detailand doing what is required to imple-ment the strategy). They can move upand down the silver cord, modifyingtactics in line with the strategy, and

shaping the strategy as executionpieces are delivered to make progresstoward the ultimate objective. Theykeep that objective in mind, modifyingit when necessary along the way torealize the final end result quickly andefficiently. However, they have yet todevelop the strength to retain the clari-ty of vision between strategy and tac-tics in turbulent times. When thepressures become intense, crises loom,or major events occur, they cant movesmoothly between strategy and tactics,and revert to their area of strength

either strategy or tactics. At that pointthey depend on others whose strengthis in their area of weakness. They willgrow over time, but they have yet todevelop a thick enough cord to with-stand intense pressures.

Using this diagnostic framework,you can effectively assess people, pro-vide them with opportunities tostrengthen their weakness, and posi-tion them appropriately. At any pointin time, organizations (and individu-als) are at some point on the Silver Cordbetween strategy and tactics. If seen

from the macro-view against a 10-yearplan, an organization may seem to behalf way up the cord, but a micro-lookat a single department may reveal thatthey are at a different point, perhaps atthe creation of a new strategy, havingjust delivered a previous objective.

Every activity, department, initia-tive, or group will be somewhere onthat cord, each perhaps at a differentplace. The macro-view with regards towhere the organization sits relative tostrategy or execution can be identified.This will differ from the micro-view,

when, instead of an average sense ofthe whole, you see the detail of eachpart and where they each sit.

Five Vantage Points

To know what is called for at placesalong the cord, consider five points:

At the Top: Strategy is required in itspurest form when the organization orfunction needs vision and a motivatinglong-term framework for action. At thispoint, individuals want to know whatthey are trying to achieve and the con-

by Phil Geldart

L e a d e r s h i p E x c e l l e n c e 3

PERFORMANCE EXECUTION

I t s t h e s t e r l i n g s i l v e r c o r d .


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text into which they can place dailyactivities and events.

Step Below the Top: Plans, dreams,and thinking need to be sketched inenough detail to visualize a plan andgenerate confidence in a perceivedpathway to achieve the strategies.

At the Middle: Here the execution ofthe strategies and the strategies them-selves must be in sync. Here youdetermine if what is being done is

compatible with what needs to bedone. Does the way you go about yourtasks support what you ultimatelywant to achieve? Is what you want toachieve coming in view? Do you haveconfidence that you will arrive therebecause of the way you are performingyour daily activities, and because ofthe things occurring around you?

Step Above Tactics: At this point, tac-tics predominate with most of the focuson getting the job done. However, thisis where innovation occurs. Once thestrategy has clearly been passed to

those who must execute, it is at thisstage people initiate change to estab-lished ways. They recognize that doingit differently, using different tools, orapplying different methodologies couldaccelerate the achievement of the strate-gy. It is clearly a tactical focus, but onethat bears the strategy in mind, thatreshapes or reworks the tactics to real-ize the strategy faster.

Full Tactical Focus. Here excellence ofexecution is crucial. True tactical bril-liance allows nothing to fall betweenthe cracks. All possibilities are consid-

ered, charts are created for all contin-gencies, and plans are put in place foreach eventuality. Resources are allocat-ed efficiently, detailed project plans aremade, experience in world-class bench-marking is captured, individualstrengths are properly aligned withindividual needs, frequent check pointsare established, plans occur as intend-edthe execution is seamless, flawless,brilliant, and cost-effective. Excellenceof execution is almost an art form! It iscritical to the success of any outcome.

Knowing what is expected along the

Silver Cord enables leaders to provideclarity, ensure that the right things arehappening at each point, and determinewhere the company, group, team orindividual should be on the cord at anypoint in time. The more skilled leadersare at all points on the cord, the moreeffectively they can move people to theappropriate points on the cord. LE

Phil Geldart is CEO of Eagles Flight, Creative TrainingExcellence. Call 1-800-567-8079 or visit www.eaglesflight.com.

ACTION: Develop strategic and tactical skills.

power of an Inspiring Identity.2. Human Value. This exists in a cul-

ture when everyone understands thebasic psychological needs of people,appreciates their positive unique contri-butions, and helps them achieve theirpotential. Allan Loren, who led a turn-around of Dun and Bradstreet, showedpeople he valued them in many ways.To protect their time, he scheduled no

meetings on Mondays or Fridays if itrequired people to travel over theweekend. Loren matched everyonewith mentors who gave them feedbackabout how they were doing relative totheir growth goals. Over his four-yeartenure, Dun and Bradstreet experiencedannual double-digit earnings growthand its value increased 300 percent.

3. Knowledge flow. This exists wheneveryone seeks the ideas of others,shares their ideas and opinions honest-ly, and safeguards relational connec-tions. A.G. Lafley, CEO of Procter &

Gamble, uses Knowledge Flow to boostperformance. When he took over thereins, P&G was performing poorly,and morale was low. Lafley surveyedemployees to get their ideas, and

implemented many ofthem. The results havebeen stunning. In his first12 months, Lafley led aneffort that resulted in anearly three-fold increasein employees who approveof P&Gs direction.

Heres a formula for a

Connection Culture: Vision+ Value + Voice = Connection.Connection transforms a

dog-eat-dog culture into a sled dog team.Great leaders see the value of con-

nection and foster a sense of communi-ty. The biotech company Genentechbrings in cancer patients to meet itsemployees. Southwest Airlines impro-ves its performance at the gate when itmaintains a 10-to-1 frontline employee-to-supervisor ratio because supervisorscan connect with and coach their peo-ple. Goldman Sachs makes its leader-

ship training available to the promisingleaders of its client companies to con-nect with them. Ed Catmull, head ofPixar Animation studios, created PixarUniversity to increase connection. Itscrest bears the Latin phrase Alienus NonDieutius (alone no longer). Creatingconnection cultures yields benefits. LE

Michael Stallard is president and Jason Pankau is a partner ofE Pluribus Partners and coauthors of Fired Up or Burned Out.Visitwww.FiredUpOrBurnedOut.com, call 203-422-6511 [email protected].

ACTION: Create a connection culture.

ONE POWERFUL SOURCE OF COMPETITIVEadvantage exists when peopleshare afeeling of connection to theorganization and colleagues in a con-nection culture. It creates an emotionalbond among members that leads togreater trust and cooperation, and apalpable sense of energy that booststhe organization and its members toplay at the top of their games.

Great leaders create connection cul-tures. Queen Elizabeth, George Washing-ton, John Wooden, and Ann Mulcahy,among many others, created connectioncultures. Relational connections are pow-erful. Connection affects usin positive way: improvesour health, boosts our cre-ativity and problem-solvingability, and connection(social capital) increases thefeeling of satisfaction in lifefor individuals and booststhe economic productivity

of nations. Emotional con-nection is four times moreeffective at boostingemployee engagement than rationalfactorsand it results in higher pro-ductivity, profitability, shareholderreturns, customer satisfaction, andemployee retention.

Three Elements

Leaders create a connection cultureby increasing three elements:

1. Inspiring identity. This exists in aculture when everyone is motivated by

the mission, united by the values, andproud of its reputation. During WorldWar II, President Franklin D. Roosevelttraveled to Seattle, Washington to meetwith 18,000 aircraft workers at Boeing.He brought with him a young pilotwho had escaped death thanks to theresilience of his bullet-riddled B-17, aplane built at that plant. Seeing andhearing that pilot thank them for sav-ing his life connected them to eachother and their cause and transformedthem into freedom fighters. Thats the

Connection CulturesGreat leaders create strong bonds.

CULTURE CONNECTION


by Michael Stallard and Jason Pankau
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have. Mistrust? Competence?Reliability? High maintenance rela-tionship? Ask them if they have dis-cussed these concerns with their peerin a way that led to solutions. If so,you likely have an influential leader. Ifnot, you likely have a garden-varietyleader who is resigned to managingaround problems.

Rather than act out their concerns,

influential leaders talk them out. Theyhone skills for addressing crucial con-versations in ways that lead to break-through solutions and strong relation-ships. As a result their influence soars.

In Search of Influence

We observe leaders in crucialmomentsas they raise such riskyissues as mistrust, incompetence, dis-missal, and embezzlement.Once, we saw a middlemanager approach his CEOabout concerns that he had

violated the law in a waythat put the company atrisk. When influential lead-ers engage in crucial con-versations, they are candidbut also so impressivelyrespectful that the mostcommon result is a dramat-ic improvement in the situation. Evenwhen these leaders dismiss individu-als, the quality of the conversationleads to a more amicable separation.Influential people find a way to behonest without compromising respect,

and to be respectful without compro-mising candor.

Here are three key principles thatresult in increased influence:

Learn to look. Those who are effec-tive at crucial conversations are awareof their behaviortheir style understressand catch it quickly when theirapproach to a conversation begins todamage dialogue. They watch fortimes when their behavioror that ofthe other personmoves to silence orviolencesome form of withdrawal orattack. When they notice their behav-

ior degenerating, they mentally refo-cus on their real goals. To get back ontrack, they consider what results theyreally care about. When the other per-son is reacting badly, they make it safe.

Make it safe. Have you ever noticedhow some conversationseven aboutrisky subjectsgo well and others,over trivial disagreements, degenerateinto combat or retreat? Why is that?We find that the antidote to defensive-ness is to make it safe. People can lis-ten to tough feedback so long as they

Expand Influence

WHAT MAKES CER-

tain leaders soinfluential? What

enables them to change hearts andminds independent of their formalauthority? What accounts for theiramazing influence? One vital skill setis how they deal with crucial conversa-tionsthose emotionally and political-ly risky issues that crop up daily.

You can quickly get a measure ofleaders influence by asking them todescribe how they handle three cru-cial conversations:

First, ask them to identify a direct

report who chronically underperforms.Watch how the CEO behaves towardthis individual. In most cases, if youwere to ask the direct report abouttheir CEOs view of them, youd get avery different story. CEOs tend tomake two mistakes in dealing withdisappointing subordinates. First, theyeither sugarcoat feedback to people whoare untrustworthy and incompetent orthey avoid them! Second, they mistakeabuse for conversation. When they offercriticism, they avoid discussing theemployees deficiencies or where the

person is coming up short; instead,they make harsh attacks on individualactions or decisions.

Second, ask them to describe a con-cern with their boss or board. We oftensee leaders act out rather than talkout their concerns with people towhom they report. One executive, forexample, had concluded that threemembers of his board didnt supporthiman allegation that appearedtrue. What undermined this leadersinfluence was not the lack of boardsupport, but how he handled the situ-

ation. Rather than engaging in a can-did discussion, he politicked aroundit. He swore his executive team to loy-alty. The board members noticed thenew wall of silence and concludedthat the leader must be hiding some-thing. They became more aggressivein expressing their concerns and with-in months drove a no-confidence votein the leader.

Third, ask them to point out a peerwho is tough to work with. Ask themto candidly express the concerns they

feel safe with the person giving it.How do you create safety? You helpothers understand that you care abouttheir interests as much as you careabout your own. When they believeyou, they open up to your views.When they dont, they shut down.Secondly, you must help the other per-son know you respect them. These twoconditionsmutual purpose and

mutual respectcreate safety. Thosewho master crucial conversationswatch for and repair safety concernsthe instant they occur. This enablesthem to be far more influential,because the other person can hearwhat theyre saying rather than havingit muffled in a fog of defensiveness.

Make it motivating. How do youtalk to someone who doesnt care about

your concerns? Influentialleaders rarely face instanceswhere they cant engagesomeone because they

know that the key to influ-ence is empathy. They firstthink how the problemsthey want to raise eitheraffect or will affect the otherperson. They think throughthe consequences of the sit-uation to others. For exam-

ple, if people appear incompetent, theirincompetence is likely causing prob-lems and frustrations to them and toothers. They dont see how their weak-nesses are connected to their own con-cerns. When you are respectful in

crucial confrontations, you help peoplesee how their own interests are servedby addressing the problem and findingsolutions.

When you learn to look, make it safe,and make it motivating, people wontnaturally roll over for you and giveyou everything you want, but yourinfluence will increaseand solutionswill appear. Rather than contributingto problems by acting out your con-cerns (which only embeds problemsand perfects the politics that keepthem alive), youll talk them out and

find a mutually beneficial solution.If you want to change situations, you

have to change how people behave.And if you want to change how peoplebehave, you have to first change howthey think. By learning to exert pro-found influence, you gain the power tochange anything and anyone. LE

Joseph Grenny is a speaker and consultant who designs andimplements change initiatives, cofounder of Vital Smarts andcoauthor of Crucial Conversations, Crucial Confrontations, andInfluencer. Call 1-800-449-5989, or visitwww.vitalsmarts.com.

ACTION: Expand your influence as a leader.

by Joseph Grenny


LEADERSHIP INFLUENCE

H a v e t h r e e c o n v e r s a t i o n s .
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(social/belonging and esteem), andTransformation (self-actualization). I

call these The Relationship Truths.

Relationship 1: The Employee Pyramid

Companies often assume that com-pensation is an employees primaryaspiration. Similar to Maslow placingphysiological needs at the base of thepyramid,Money (or, the full compen-sation package) is a base need, but alsoa base motivation for most employees.Loyalty and inspiration are fosteredfurther up the pyramid. Recognition isnot just about knowing someonesname, but also their talents, goals, and

dreams. The main reason employeesleave their job is the lack of recognitionthey feel from their direct supervisor.

At the top of the Employee Pyramid

is a concept that few employers talkabout. FindingMeaningin onesworkboth in what you do and in thecompanys missioncreates a moreinspired employee. One of my mostgratifying experiences is to help thecompanys housekeeping staffoverone-third of our employeesfindmeaning in cleaning rooms daily.

Relationship 2: The Customer Pyramid

Just as money is at the bottom ofthe Employee Pyramid,Meeting theExpectations of customers is the sur-vival need for this Relationship Truth.Most companies spend too much timetrying to achieve basic customer satis-faction at the base of this pyramid.Creating customer satisfaction wontnecessarily tame your customers ten-dency to wander in an increasinglypromiscuous marketplace. Tappinginto customer Desires can create differ-entiation, which can be your cure for

Peak Experience

AFTER 15 YEARS OFgrowingJoie deVivre Hospitality into

Northern Californias largest indepen-dent hotel group, I was hit by a per-fect storm. In 2001, the dot-com crash,fallout from 9/11, and the SARS crisisconverged upon the travel industry,sending the San Francisco Bay Areahotel industry into its biggest down-turn. I started looking for a solution.

Behavioral psychologist AbrahamMaslow studied healthy people, look-

ing for commonalities in their outlookand behavior. He believed wed beensold short by psychologists who sub-scribed to Freuds psychoanalysis andB.F. Skinners behaviorism. He notedthat we are motivated first by physio-logical needs for sleep, water, andfood. As those needs are fulfilled, wemove to higher needs for physicalsafety, affiliation, social connection,and esteem. At the top of the pyramidis self-actualizationwhere peoplehave transient peak experiences.

A peak experiencecomparable to

being in the zone or in the flowiswhen what ought to bejust is. Peakexperiences are transcendentalmoments when everything seems tofit together perfectly. Maslow wrote,These moments of ecstasy cannot bebought, guaranteed, or even sought,but we can set up the conditions sothat peak experiences are more likely.

Yet, I couldnt find one book thatapplied Maslows theory to the moti-vational truths that define our keyrelationships at work. I wondered: ifindividually we aspire to self-actual-

ization, why couldnt companiescol-lections of peopleaspire to this peak,too? What does a self-actualized com-pany look like? And how could wecreate the conditions so that peak expe-riences are more likely? How could Itranslate Maslows pyramid intosomething actionable for my team?

I started by defining three relation-shipsemployees, customers and investorsand then distilled Maslows fiveneeds into three: Survival (physiologi-cal and safety), Success

progressive commoditization. Whencustomers have their desires met, theyare substantially more likely to comeback for moreand theyll tell others.

Fred Smith, CEO of Fed Ex, notes:We thought we were selling the trans-portation of goods, when in fact wewere selling peace of mind. Mostcompanies think too narrowly aboutwho they are and whom theyre serv-

ing. Rarely do they consider research-ing and meeting the Unrecognized

Needs of their customers. Instead, atbest, they create focus groups to listento their customers conscious wishes.But, companies like Apple and Harley-Davidson became highly successfulcult brands by creating self-actualizingexperiences for their customers.

Relationship 3: The Investor Pyramid

There would be no employees orcustomers if there werent a capitalsource for the business. This Relationship

Truth addresses what a company can doto meet the needs of its investors. Manythink the only need an investor has is tomake bucketfuls of money. No doubt aninvestors base premise is to assure astrong ROI. To facilitate this they needto have Transaction Alignmentwithcompany executives or a start-up entre-preneur, which builds trust.

Yet, just being aligned on the keygoals for an investment creates a short-term, transactional relationship. Youmove beyond this level by creating acollaborative partnership in which a

company or entrepreneur and theinvestor see the relationship as beingthe core to why they do businesstogetheras opposed to having thetransaction act as the glue that keepsthis relationship alive. At the core ofRelationship Alignmentis the idea thatan investor has developed deep confi-dence in the people they invest in.

At the top of the Investor Pyramid isthe transformative nature of whatinvesting can mean in terms of makinga difference. Aself-actualized investorsees the Legacy in their investing and

experiences pride of ownership.These Relationship Truths are the rela-

tional mojo that make companies suc-cessful. Creating peak experiences forkey constituencies leads to peak perfor-mance. Most of us spend our livesfocusing on what is, but Abe Maslow re-minded us to focus on what could be. LE

Chip Conley is CEO of Joie de Vivre Hospitality and author ofPeak: How Great Companies Get their Mojo from Maslow(Wiley). Visit www.ChipConley.com.

ACTION: Create peak experiences.

by Chip Conley


PERFORMANCE PEAK

G e t y o u r m o j o f r o m M a s l o w .
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tive about the future. Beyond having adream, a leader must communicate thevision in ways that encourage people tosign on for the duration, excite themabout the cause, and make the contextmeaningful. Whatever the circum-stances, when leaders breathe life intoour dreams and aspirations, were morewilling to enlist in the movement.

Competent. To enlist in a cause, peo-

ple must believe that the leader iscompetent to guide them. They mustsee the leader as having relevant expe-rience and sound judgment. If peopledoubt the persons abilities, theyreunlikely to join in the crusade.Leadership competence refers to theleaders track record and ability to getthings done. Such competence inspiresconfidence that the leader will guidethe organization in thedirection it needs to go.

Credibility Is Key

Three of these four keycharacteristics of what peo-ple want most in their lead-ers make up source credi-bility. In assessing thebelievability of sources ofcommunicationwhethernewscasters, salespeople,physicians, priests, managers, militaryofficers, politicians, or civic leadersresearchers typically evaluate them onthree criteria: their perceived trustworthi-ness, their expertise, and their dynamism.Those who are rated more highly on

these dimensions are considered to bemore credible sources of information.

These three characteristics are simi-lar to the essential leader qualities ofhonest, competent, and inspiring.More than anything, people want tofollow leaders who are credible.Credibility is the foundation of leadership.

We also must believe that leadersknow where were headed and have avision for the future (forward-looking).Leaders must do more than be reliablereporters of the news. Leaders make thenews and make sense of the news. We

expect our leaders to have a point ofview about the future. We expect themto articulate exciting possibilities.

Although compelling visions arenecessary for leadership, if the leaderis not credible, the message rests on aweak and precarious foundation.Leaders must be vigilant in guardingtheir credibility. Their ability to takestrong stands, to challenge the statusquo, and to point us in new directionsdepends upon being highly credible.

Because these findings about the

characteristics of admired leaders areso pervasive and consistent, we creat-ed as our First Law of Leadership: If youdont believe in the messenger, youwont believe the message.

What Is Credibility Behaviorally?

Credibility is the basis of leadership.But what is credibility behaviorally?How do you know it when you see it?

Here are six common phrases peopleuse to describe how they know credi-bility when they see it: They practicewhat they preach. They walk thetalk. Their actions are consistent withtheir words. They put their moneywhere their mouth is. They followthrough on their promises. They dowhat they say they will do.

When people decide whether aleader is believable, theyfirst listen to the words,then they watch theactions. They listen to the

talk, and then they watchthe walk. They listen tothe promises of resourcesto support change initia-tives, and then they waitto see if the money andmaterials follow. Theyhear the pledge to deliver,

and then they look for evidence thatthe commitments are met. A judgmentof credible is handed down whenwords and deeds are consonant.

This realization leads to a prescrip-tion for leaders on how to build credi-

bility. This is our Second Law of Leader-ship: Do what you say you will do.

This definition of credibility corre-sponds with the two actions everyleader must take to build and sustainpersonal credibility. To be credible inaction, leaders must first be clear abouttheir beliefs; they must know whatthey stand for. Thats the say part.Then they must put what they say intopractice: they must act on their beliefsand do. This consistent living out ofvalues is a behavioral way of demon-strating honesty and trustworthiness.

Credibility makes a difference in theattitudes and actions of employees,customers, and other vital businesspartners. Leaders must take it person-ally. Loyalty, commitment, energy andproductivity depend on it. LE

James M. Kouzes is the Deans Executive Professor ofLeadership, and Barry Z. Posner is the Dean, Leavey School ofBusiness, Santa Clara University. This article is adapted fromtheir book The Leadership Challenge, 4th edition (Jossey-Bass)and used with permission. Email Jim [email protected] Barry [email protected].

ACTION: Learn ways to behave credibility.


LEADERSHIP CREDIBILITY

by James M. Kouzes and Barry Z. Posner

LEADERSHIP IS A RELATIONSHIP BETWEENthose who aspire to lead and thosewho choose to follow. Strategies, tac-tics, skills, and practices are emptywithout understanding the aspirationsthat connect leaders and constituents.

For 25 years weve asked people totell us what they look for in a personthat they would be willing to follow.We first asked: What values, personal

traits, or characteristics do you look forand admire in a leader? Respondentsidentified different values, traits, andcharacteristics. Content analysisreduced these items to a list of 20(each grouped with several synonymsfor clarification and completeness).

From this list, we developed a sur-vey Characteristics of Admired Leaders,and sent it to 75,000 people worldwide.We distribute a one-page checklist, askrespondents to select the seven quali-ties that they most look for andadmire in a leader, someone whose

direction they would willingly follow.Our findings have been consistent.

Clearly, there are a few character testssomeone must pass before others will-ingly grant the designation leader.

Four traits receive the most votes:Honest. Honesty is selected 90 per-

cent of the time, emerging as the singlemost important factor. If people aregoing to willingly follow someonewhether into battle or into the board-roomthey first want to know thatthe person is worthy of their trust.

Forward-looking. About 70 percent

of respondents select the ability to lookahead, having a sense of direction anda concern for the future. Whether wecall that ability a vision, dream, call-ing, goal or agenda, leaders mustknow where theyre going if theyexpect others to willingly join them.They have to have a point-of-viewabout the envisioned future, and theyneed to connect that point of view tothe hopes and dreams of constituents.

Inspiring. People expect their leadersto be enthusiastic, energetic, and posi-

CredibilityWhat followers expect.
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Creating and maintaining an engag-ing culture is a challenge of trustbetween individuals, groups, andorganizations. Warren Bennis says,Trust is the emotional glue that bindsleaders and followers together. Trustcreates engaged employees.

Trust is a function of a leaderscapacity to close the credibility, orsay-do, gap between leaders andcolleagues. Employees develop trust

when they believe that they candepend on their leaders to do whatthey say (aligned character), andwhen their organizations show thediscipline and management capacityto follow through with the plans andcommitments (aligned execution).Employees who trust their leaders andtheir organizations are creative, will-ingly take risks, and collaborate.

Beyond the communication gaplies the real tap-root of the problemasay-do gap. Communication alonecant close this gap: it exists because the

things the leader communicates are nottrue! Closing this gap requires characterand discipline.

Trust is a real and concrete resource,as real as liquid assets, as concrete asinfrastructure, as verifiable as product

inventory. Trust can begained and earned. It cangrow, compound and appre-ciate, and being trustworthycan be learned and mastered.

Credibility is also an oper-ational challenge. Can theenterprise be trusted to hold

fast to its purposes, plans,strategies, priorities, andtimelines? If people decide to

believe the strategic plan and serve it,will this lead to reward down the line?

For example, if the value statementsays, Our customers come first, dothose who put customers first get recog-nized and rewarded? Or, if manage-ment places priority on redesigning aninventory system, does staff get the sup-port and release-time they need, or doesit get pulled away to urgent matters?

Extraordinary breakthroughs are

produced by engaged people whowake up thinking: Im going to makea difference today! My job is mypassion! A company that fosters suchthoughtand creates a culture wherepeople bring their whole selves to thejobhas the clear advantage. LE

Jim Dittmar is chairman of Leadership Studies at Geneva College.John Stahl-Wert and Ken Jennings are the co-authors of TheServing Leader andTen Thousand Horses. Email Dittmar([email protected]), Stahl-Wert([email protected]) andJennings ([email protected]) or visit www.tenthousandhorses.com.

ACTION: Create a culture of engagement.

Trust and Engagement

IS EXCELLENCE IMPOR-

tant to you? Do youwant it to be? Although

leaders vary in their definitions ofexcellence, and how best to achieve it,most agree that excellence is a never-ending pursuit and that whatever theirchallenges and opportunities aretoday, they will be different tomorrow.

Leaders often face nine challenges: Communicationpeople lack clarity

and direction, limiting innovation Accountabilitymeasurements of and

responsibility for results are insufficient Engagementpeople dont seem to

care as much or arent sure of their role Alignmentactivities arent con-

nected with mission and strategy Directiondisconnect between

planning, strategy and execution Transitiona desire to pass the

torch successfully Controlthings feel out of synch Frustrationexcess friction at work Risk Managementprofit variability

versus growth rate.Your challenge at the moment is a

symptom of a deeper need to system-atically increase your capability to

address future challenges.An excellence program is an orga-

nized approach to grow leaders abili-ty to deal with an ever-changing andchallenging environment. The pro-gram needs to grow with the businessand enable leaders (and employees) toalign their plans and activities to sup-port the strategies and achieve goals.

Master Six Disciplines

Learn to master six disciplines:1. StrategyDecide whats impor-

tant(and by implication whats not

important) so you can aim the alloca-tion of resourcestime, money andcreativitytoward this end. In thisannual discipline, leaders systematical-ly and regularly review and renewtheir mission, values, strategic posi-tion, vision, their most vital few objec-tivesand agree what to stop doing.

2. PlanningSet goals that lead.Well-defined goals are among the mosteffective tools available to any leaderyet most leaders dont set goals that leadtheir people in the right direction. The

Use these keys to successful change.

CHANGE IS THE NEW NORMAL. GAIN-ing and maintaining a competi-tive advantage requires the ability torespond and adapt to market pres-sures with agility and speed.

Yet most companies fail to achievesuccessful, sustained change 70 per-cent of the time. When leaders attendto the relationship between trust and

engagement, they increase the suc-cess of their change initiatives andsecure competitive advantage.

Engaged employees are committedto and passionate about the vision,mission, and values. They give fargreater discretionary effortand engage their talents toensure team success.Unfortunately, only about 25percent of employees aretruly engaged (and only 12percent are fully engaged)leading to lost productivity,

poor results, and failedchange efforts. Exceptionalcompanies with engagedworkers experience a 50 percent high-er employee and customer retention,38 percent greater productivity, and27 percent higher profits (Gallup).

Disengagement cuts productivity.Disengaged workers might show upon time and do what is minimallyrequired, but their psychological,emotional, intellectual and imagina-tive selves never make their wayacross the company doorstep.

Engaged employees are fully com-mitted to organizational success, pas-sionate about what theyre doing,and fully aligned with and support-ive of mission and values.

The best leaders assume responsibil-ity for worker engagement: they createa culture in which workers choose togive their whole selves. Leaders dontengage workers! People engage them-selves when they discern and discov-er that the place they work and theleader they serve is trustworthy.


Six DisciplinesLeaders seek excellence.

CHANGE ENGAGEMENT CHANGE DISCIPLINES

by Gary Harpst

by James K. Dittmar, Kenneth R.

Jennings, and John Stahl-Wert
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Three Helpful Strategies

Consider three strategies:1. Give under-performers the straight

story. Allowing them to remain on thepayroll is a form of dishonesty thatharms the organization. Continuing topat them on the back and grant themraises does not square with their reality.They know their work does not meetstandards and does not match whatcolleagues do. If you dont tell the truth

about how they perform, how can theytrust you to tell them the truth aboutother things? Employees know whoisnt pulling their own weight. Whentheyre all treated the same and receivethe same feedback despite the refrain,we reward people based on perfor-mance, they discount other promises.Trust dips even lower. So, deal honestlywith immature, defensive employees.

2. Offer great performers their props.Some leaders fear praising star perform-ers, thinking if they tell them how welltheyre doing, they may develop their

talents and move on. Whats worse?That they grow and leaveor becomediscouraged and stay? Without encour-agement, valued employees may feelthat you dont care about them and go

where somebody caresmore or encourages them.Great performers need hon-est feedback as well.

3. Own up to your mis-takes when you miss yourcues. A manager for an oilcompany reported that hewas about to close a large

gas contract with a netprofit of millions of dol-lars. When the deal fell

into jeopardy, he couldnt tell his col-leagues. Quarterly, he presented vagueexplanations about why the contractremained unsignedyet insisted thedeal would close shortly. Since bud-gets had been based on his projections,when the deal fell through, the loss ofprojected revenues created havoc.

When people admit their mistakes,they tend to say, Were fortunatethings didnt turn out worse. Face-

saving rarely works. Silent message:Self-protection at the expense of credi-bility. In such cultures, everyone getsalong, goes alongand sinks together.Open communication and emotionalmaturity foster trust and excellence.Say itwith grace and sensitivity, yes.But say it directly, firmly, clearly. LE

Dianna Booher is president of Booher Consultants, a keynotespeaker, and prolific author of The Voice of Authority. Visit.www.booher.comor call 817-318-6000.

ACTION: Practice openness to build trust.

DELAYED ONA TRIPAND

sitting in an airlineclub, I observe this scene:

Amy, Jeanne, and Bill arrive at theclub together, pile their luggage next tome, and unpack their laptops. Billoffers to buy hamburgers for all three.While hes gone, Amy and Jeanne dis-cuss a presentation theyve just deliv-ered in Chicago. Amy says to Jeanne,I hate it when he critiques my presen-tationsmy slides, the structure. Idont think hes all that good himself. Ithought I did fine today.

Yeah, you did great, Jeanne says.

Amy leaves to get coffee and chargeher cell phone. Bill returns with thefood, joins Jeanne, and they start eating.Bill gets interrupted by a cell phonecall. After the conversation, Jeanne asks,Was that about the job?Have you decided whollget the promotion?

Yes. Steve. Illannounce it Monday. Hedid a fabulous job today inthe meeting. Were sure towin that contract.

Amy is intimidated

when you critique her pre-sentations, Jeanne says.

Too bad. She could bemuch bettershe should get help.

Jeanne agreed and their conversa-tion moved on to other topics.

Two things struck me about thatsnippet of conversation. 1) Jeanne toldAmy what she wanted to hearYoudid great. 2) Amy had likely missed apromotion because she routinelyrejected feedback from her boss.

Emotional maturity and openness todirect communication without defen-

siveness are key traits. Feedback feelsuncomfortable to people. As long asface-saving remains the goal and cul-ture, people will wonder: Shall we besilent and save the relationship? Orcommunicate honestly and solve theproblem? People tend to say what theythink others want to hear. When some-one speaks candidly, relationships rippleand projects grind to a halt until some-one repairs the damage. This cyclekeeps organizations locked in medioc-rity, and people stalled in dead-end jobs.

Cues, Clues, and PropsFace-saving or problem-solving?

by Dianna Booher

COMPETENCY COMMUNICATIONpurpose of this discipline is to produceclear and measurable annual goals.Pursuing these goals will lead people toalign their daily activities with the vitalfew objectives set in the strategy. Theresult is a brief goals statement thatevery team member can support.

3. OrganizationAlign systems.The systemspolicies, processes, tech-nologies, measures, and peopleareoften at cross-purposes with the stated

priorities because most leaders lack anorganized approach to keep their sys-tems aligned with their strategy. Thisdiscipline taps the knowledge of theentire workforce to identify the areaswhere the company will get the bestROI in policies, processes, measures,technologies and people.

4. ExecutionWork the plan. One ofthe best learning tools is the individualquarterly plan. In this discipline, everyperson works with the team leader todevelop Individual Plans for the comingquarter. These goals are reviewed and

aligned with company goals. This planserves as a time-saving template for aweekly status report. Every personknows how to set goals, understand pri-orities, take responsibility for their goals,become accountable, report progress, anduse their capabilities to solve problems.

5. MeasurementInnovate purpose-fully. Innovation means problem-solv-ing, and everyone has the ability tosolve problems. This discipline pro-vides principles and measurement toolsthat are used in the other disciplines tohelp leaders set clear goals and align

daily activities to meet them. Thesegoals should align with company prior-ities, and employees should use theirinnate creativity to meet or beat goals.

6. LearningStep back. This disci-pline helps leaders gain perspective onthe factors that affect performance. It isachieved through a series of discoveryexercises, exploring externals (competi-tors, industry, economic) and internals(goal performance, stakeholder feed-back, measures, SWOT.) All team mem-bers provide input on performance bycompleting a 360 feedback survey and

annual performance appraisal.Enduring excellence has: 1) a repeat-

able methodology to drive leadership;2) external coaching for accountability;3) a system to align the activities of teammembers; and 4) a community of like-minded people to accelerate learning.

When these elements come together,leaders expect to see enduring change. LE

Gary Harpst is CEO of Six Disciplines and author of SixDisciplines for Excellence. [email protected].

ACTION: Develop these six disciplines.

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placing you in a position of weaknessfrom which it is difficult to recover.

The inability to focus on your success-ful and profitable activities is the pri-mary cause of frustration, poorperformance, and failure.

3. Accept the inevitability of change.It takes discipline to confront reality,clarity to focus on your strengths, andcourage to accept the inevitabilityand necessityof change. The biologi-cal world is rife with examples ofspecies that failed to adapt to changingconditions and faded away. Likewise,in business, the ability to adapt to shift-ing circumstances is essential to sur-

vival. Whether the issue is sheddingunprofitable operations, terminatingunproductive employees, or anticipat-ing the obsolescence of our most popu-

lar products, the successful operationmakes moves early, empowers peopleto experiment with new methods, andencouraging junior staff to speak up.Change is often the most dauntingchallenge a leader will encounter, evenas it offers the greatest opportunity.

4. Be passionate. Attitude deter-mines outcome. If you dont believewhat youre saying, it will show. If youdont believe in your ability to meet

your clients needs, they will know.The most common reason that a poten-tial customer decides against purchas-ing a product or service is the fear ofmaking a mistake. All thats requiredto clear that hurdle is sincere confi-dence in your ability to deliver on thecustomers expectations, and the credi-bility to convince the customer thatyou can. Confidence builds trust. Trustbuilds relationships. Relationshipsbuild sales. That doesnt mean beingbest in the world at what you do. It

Leadership Excellence

AS BOTH AN OBJEC-tive outsider andan intimate insider, the

investment banker occupies a uniquevantage point. In analyzing and rec-ommending strategic and financialoptions available to a business, welearn about every aspect of its opera-tions, yet have no direct stake in it.Our role is to provide reliable,informed advice and help the clientachieve the most favorable outcome.

Each business is unique, yet all share

common challengesand these haveeverything to do with the way theirleaders think and act. Seven characteris-tics are present in great companies:

1. Confront reality. Abraham Lincolnonce asked, How many legs does adog have if you call the tail a leg? Hisanswer: Four. Calling a tail a leg does-nt make it a leg. For many of us, itseasier to wait for things to improvethan to admit theyve gone wrong. Weavoid an admission of failure. In thecontext of personal aspirations, we cancast our denial as a form of idealism

and, in so doing, make it admirable.But executives with a fiduciary respon-sibility to stockholders, employees, andother stakeholders have no such luxury.They need to recognize when some-thing isnt workingconfront the reali-ty of the present situationand acceptresponsibility to change or terminate it.

2. Focus on your strengths.Confronting reality is the only way toidentify which aspects of a businessare working, and which products,processes or businesses sap yourstrength, time, and energy. We often

hear about the turnaround artist whoapplies great skill and tenacity to fix-ing broken businesses. And given thehero status often accorded them,many executives spend much of theirtime and energy addressing problems.Sure, you might logically invest someresources in underperforming assetsin the hope that you can correct theproblems and transform failure intosuccess, but in most cases your focuson problems diverts your attentionfrom your more profitable operations,

does mean that you have to believe inwhat youre saying and selling. If youarent convinced that what you do hasreal value, you should do somethingelse, or do what youre doing different-ly. Either way, if you dont feel goodabout your work, it will be difficult toexcite the customer and all but impos-sible to find the motivation to succeed.

5. Be consistent. Like oxygen, consis-

tency is easier to recognize when itslacking, and easier to see in others. Yetfew things are more unsettling or dis-ruptive than erratic behavior. Consisten-cy builds confidence. It signifies relia-bility. It is the foundation of positiverelationships. And it provides a frame-work for coping with change. So, estab-lish a consistent method of operation,and adjust to changing conditions.

6. Value continuity. Anyone can do ajob once, but it takes experience andknow-how to do a job well and repeat-edly over time. Executives who believe

they (or their consultants) have all theanswers overlook a most valuableasset: the institutional knowledge thatresides in their workforce. When lead-ers start to know and listen to theirpeople, they often find diamonds inthe rough with deep insight into themost basic operationspeople who areoften closest to the customer and in thebest position to identify what works,what doesnt, and how best to fix it.The foundation of a great company isthe way it taps that knowledge, devel-ops its people, and builds a strong

bench of future managers and leaders.7. Replace fear with faith. Fear is the

faith that things wont work out. Whenyou operate from a position of fearthat the product will fail, the dealwont close, the competition will tri-umphyou validate a belief in yourinferiority. Fear immobilizes you andimpedes your momentum. Thoughtsof failure are destructive. They standbetween you and your goals. Faith isthe belief in your ability to succeedthe confidence to trust your intuitionand act on it. Success may elude you,

but the ability to let go of feartotransform faith in failure into faith insuccesscreates a culture of optimism.

These seven steps contribute to suc-cess. Leadership excellence is as elu-sive in essence as it is tangible inresult. We may not be able to define it,but we know it when we see it. LE

Joe Berkery is president of Berkery Noyes, the leading indepen-dent investment bank providing mergers & acquisition adviso-ry services to companies inthe information, media andtechnology industries. Visit www.BerkeryNoyes.com.

ACTION: Take these seven steps to excellence.

by Joseph W. Berkery

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

LEADERSHIP PRACTICES

T a k e t h e s e s e v e n s t e p s t o s u c c e s s .
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music, MP3 players were produced bysmall companies that were unable toprovide content. Apple CEO Steve

Jobs orchestrated the network of inter-actions in the music industry to pro-duce the iPod and transformed howmusic is delivered to customers.

By shiftingperceptions you createwinners. Former GE CEO Jack Welchshifted the hierarchy of how to win byinstituting a dictum to be number 1or number 2 in the industry or getout. During his tenure, GE increasedits market cap by $400 billion.

By shifting structure, you shapebehavior. Churchill once commented,First we shape the structures, and

then they shape us.The best strategic shifts involve dif-

ferent elements. Our fortress comman-der shifted the time frame of the attack-

ing army from a short to a long battle.He shifted the interaction from defend-ing to sending a counterattacking mes-sage. He shifted the perception frominevitable loss to endurance. He shiftedthe structural forces questioning thecredibility of this siege strategy.

Four Advantage Points

Leaders can shift to four AdvantagePoints to see opportunities others miss,

overcome obstacles, and influence out-comes when others are stuck:

1. Adaptive Stretching. Two shoesalespeople go a foreign country to selltheir products. The first salespersoncalls headquarters and says, Theydont wear shoes here; Ill be on the nextplane home. The second shoe salesper-son calls up headquarters and says,They dont wear shoes here; send asmany as you can! Which personwould you rather have on your team?

Often its not the best who wins

See Possibilities

IMAGINE THAT YOU AREa commander of a

fortress under a dailysiege for six months without anymeans to communicate with the out-side world. Your supplies are down totwo bags of grain and one cow. Withsuch scant supplies, starvation seemsinevitable. What would you do?

Expecting to hear ration as bestyou can, you can empathize with thequartermasters surprise and shockwhen his commander ordered him tostuff the cow with the remaining grain

and catapult it over the wall at theenemy during the next attack.

What would you think of thisbovine assault if you were on thereceiving end? The field officer couldonly assume that his enemy hadample supplies. Assuming it would bea long battle, he ordered an immedi-ate retreat, and the fortress was saved.

As a leader, could you shift theodds in your favor under the duressof battle? Every leader endures diffi-culties, but where some fall apart, oth-ers come through in an even better

position. These advantage-makers trans-form challenging situations into thebest possible outcomes. They see pos-sibilities that others dont even knowexist. It almost looks like luck, but itisnt. They arent any more creative,intelligent, determined, optimistic orgoal-oriented, nor do they possess anyspecific personality type or traits.

Strategic shifting. Advantage-mak-ing requires a strategic shift, and thesecan take many formsof time, interac-tions, perceptions, and structures. Thekey is moving to a vantage point

finding advantage points: a superiorposition, condition, situation, or oppor-tunity that provides a comprehensiveview or commanding perspective.

By shifting time, you generate pos-sibilities. JFK inspired a nation bymoving the vision of lunar explo-ration from a far-off dream to anachievable goal by challenging scien-tists to send a man to the moon andreturn him safely within a decade.

By shifting interactions you changethe game. In the early days of digital

its the individual or team that is themost adaptive. Non-adaptive respons-es are costly. Managers tend to repeatfamiliar and reliable patterns. They fol-low the dictum, It worked before, andit should work again. New situations,however, require new approaches. Aleader needs to shift to different van-tage points or generate options that aremore of the same. Former CEO of Intel,

Andy Groves aptitude for adaptivestretching facilitated his success.

2. Change the game. If you are in ahole, stop digging and shift the game180 degrees. First ask, hows yourapproach working for you? Thendevise a 180-degree strategy. If you arepushing, pull. If telling, ask. If waiting,take action. If taking too much action,do less. Most companies, for example,assume that they should strive to benumber 1. Avis rental cars tried to dojust that, and almost went bankrupt bygoing head to head against Hertz. Then

Avis made a shift and proclaimed, Weare number 2. We try harder. That shifttripled Aviss market share from 11 to35 percent in one year.

Hidden assets can be found by shift-ing convention. Forbes changed a con-ventional sick pay program into well-ness pay. Employees could earn money,and Forbes had a 30 percent decrease inmedical and dental claims. This is notsimply contrarian thinkingit is strate-gically shifting, like our fortress com-mander, to change the game.

3. Move or lose. Manage momen-

tum to advance. Just as a riverbeddetermines a rivers course of action,your business has an underlying struc-ture that determines your course ofaction. Structure shapes behavior.Most change efforts fail because theunderlying structure has an allergicreaction to the change.

4. Strategic influence. Small influen-tial moves can create big-leverage gains.

All Advantage-Makers tell vivid sto-ries that create questions. The answersinfluence perception. Our fortress com-mander catapulted a cow to suggest he

had plenty of food for a long battle.His demonstration influenced the per-ception and won the day. Most argu-ments are won or lost based upon howyou frame the issue. The most power-ful frame wins, regardless of the facts.

By applying these Advantage Points,you can shift the odds any time. LE

Steven Feinberg, PhD is author of The Advantage-Makers. Heis a consultant, speaker and leadership coach. Call 650-852-0574 or visitwww.stevenfeinberg.com.

ACTION: Become an advantage-maker leader.

by Steven Feinberg

L e a d e r s h i p E x c e l l e n c e 1 1

LEADERSHIP ADVANTAGE

A r e y o u a n a d v a n t a g e - m a k e r ?
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performance discussion is straight talk.Concerns are put on the table.

3. Accuracy. Conversation is biasedtoward facts, data, and observablebehavior. Youll hear: Its my opinionthat . . . signifying that the speakerwants listeners to know that he or sheis about to enter a no-fact zoneorOn what do you base your judgment?asking for factual back-up. When aproblem is discussed, the first order ofbusiness is to get the facts: What is theproblem? Where and when is it occur-ring? Who and how much is involved?

4. Efficiency. Theres little beatingaround the bush and verbal foreplay

among high performers. Rather thanlong preambles, youre apt to hear,John, I have a concern about yourbehavior, and we need to talk. Excuse-

making is a great time waster, which iswhy the conversation turns away fromIts not my fault or If I only hadmore resources kind of statementsand more toward accepting responsi-bility and moving on to solutions.

5. Completeness. Youre unlikely tohear half the story. Instead, youll like-ly hear, Lets discuss the pros andcons of the decision, or Here are therisks with my proposal, and hereswhat we stand to gain. The aim is to

inform, not to finesse.6. Timeliness. Theres a just-in-time

feature to high-performing conversa-tions. Lets put the factsall ofthemon the table, now. One of thefavorite questions youll hear is, Bywhen? Theres also plenty of If . . .then language: IfMarketing executesit plan by June, then Sales will haveplenty of time to generate business.

7. Focus. Conversation is typicallystrictly business, driven by the out-come required in a given situation. If

Moments of Truth

DO ORGANIZATIONS,leaders, and teamscommunicate in a way

that marks them as high performers?Listen to this definition of a high-per-formance organization by RobertGordon, CEO of Dairy Farmers ofAustralia: It is a horizontal organiza-tion in which everyone operates by aclearly defined set of decision-makingprotocols; where people understandwhat they are accountable for and thenown the results. It means moving to an

action-and results-driven workforcenot one that waits for instructions ortrips over functional boundaries.

Tucked away in this definition aresome trigger words for high perfor-mance: horizontal, decision-mak-ing protocols, accountable,results-driven workforce, and nofunctional boundaries. We wouldadd two more key words: alignmentwhere an organization and its teamsare in sync on everything from strate-gy to the way employees relate toeach otherand engagedwhere team

members are fully committed toachieving team goals.

10 Common Elements

Over the past year, we interviewed40 high-performing leaders andobserved their team meetings. What isstriking is the consistent pattern ofcommunication of these leaders andteams. Here are 10 common elements:

1. Clarity. High-performing playersdemand clarity, not by shouting andscreaming we need greater clarity,but by closely questioning one another

when an issue is discussed or theyhave differences of opinion. Can youclarify that? What do you mean?Can you give us an example? Whatdo you see as the consequence? Youhear many such clarifying questions.

2. Authenticity. High-performancelanguage sidesteps game playing. Yourarely hear team members askingimposter questionsthose designedto poke holes for the sake of exposinga colleagues Achilles heelor mak-ing non-relevant statements. High-

the discussion involves setting priori-ties, you dont hear anyone jumpinginto solution mode; if the conversationfocuses on identifyingthe root causesof a problem, youre not likely to hearmuch about taking action to correctthem. On some teams, there is banter,but people disagree without being dis-agreeable. One CEO asserted that onhis team, Insult is the language of

affection. But often it is the source ofaffliction, which is why its not part ofhigh-performance conversations.

8. Openness. High-performance con-versations go there as a function ofhigh-performance features: no silos,accountability, decision-making proto-cols, and a focus on results. If a teammemberor leaderis underperform-ing, or if a function is problematic, col-leagues will go there. Elephantheadsthose touchy issues that mostteams pretend dont existare anendangered species. High-performance

teams make tough calls on new hires,after a frank, fact-based discussion.

9. Action oriented. At decision time,high-performing teams ask: What arethe key objectives? Who needs to beinvolved? By when should the teamreview the decision? The words connoteaction. They also convey immediacy, aswhen teams talk about the 24-hourrule. This means getting back to a col-league with a response, if not a conclu-sion, within one business day.

10. Depersonalization. High-per-forming teams go there, but they

dont go personal or get defensive.Rather, they remind one another: Itsa business case: lets treat the discus-sion objectively. Also, theres littlemember-to-leader discussion, such asover to you for the decision or Imnot sure, what do you think?

Conversation is crucial duringmoments of truth: situations in whichteam members hold leaders account-able. One CEO was engaged in a small,pet-project acquisition that drained hisattention during a downturn in sales,causing concern among team members.

They called him on it, telling him thatthe acquisition had become a blindspot and distraction. The input wasfactual and dispassionate, causing theCEO to quickly offload the distraction.

To the extent that leaders walk thetalk of high performance, others arelikely to do the same. LE

Howard M. Guttman is the principal of Guttman DevelopmentStrategies, and author of Great Business Teams. [email protected].

ACTION: Excel in the moments of truth.

by Howard M. Guttman

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

PERFORMANCE COMMUNICATION

T a l k a n d w a l k p e r f o r m a n c e .
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rejected by our customers, are theright ones. We havent proven that weadd the value we know is possible.

Three Suggestions

Overcoming these challenges re-quires making difficult changes in whowe are and what we do. My three sug-gestions arent easy, fast or popular, butthey position us for long-term success

as the preeminent group within HRthe true business partner whose contri-bution is visible on the balance sheet:

1. Elevate the quality of practition-ers. We must improve our capabilitiesand business orientation, injecting anoperations mentality into our TMpractices. We must fall in love withbusiness and teach others to do thesame, thus elevating our capabilities.This declaration is notintended to disparage any-one in TM. I stipulate thateveryone in our field has

good intentions, are goodpeople, and have the bestinterests of the business atheart. However, I see gapsbetween these good inten-tions and what our busi-nesses need. We can closethese gaps if we knowbusi-ness, lovebusiness, and use a productionmindset to build leaders.

To knowbusiness, we must under-stand its financial, operational andstrategic realities. Everyone in TMshould understand financial state-

ments, how a product or service isproduced, and one classic strategymodel. Attracting more line managersand MBAs into this field will also help.

To lovebusiness, we must believe itis a force for good in our communities,be fascinated by it, and have an abid-ing curiosity about how it works.

To have a production mindset, wemust start producing leaders the sameway we produce other products. Weare not craftspeople, carefully assem-bling one leader at a time. We are theshift supervisor at the talent factory,

ensuring that we produce a specificnumber of leaders over a specific timewith a specific set of capabilities.

2. Simplify our work. We must sim-plify the work we do while simultane-ously adding value to ensure that TMpractices are implemented by managers.

First, simplify our processes. If imple-mentation is the key to successful out-comes, then making processes simpleis the key to successful implementa-tion. Most managers will gladly useany HR tool or process that delivers

more value than the effort required touse it. If we can redesign our processesto meet this value/effort balance, wellimprove the effectiveness of our ser-vices. To get there, we must ask,What is the business goal of thisprocess? We then need to design asimple process to achieve those results.At Avon, we call this One Page TM. Weused this approach to redesign every

talent process and tool. Avons man-agers are using the toolsand thank-ing us for creating them.

Second, add value to each practice. AtAvon we applied One Page TM to bothour new engagement survey and ournew 360 assessment process. In craft-ing our survey report, we wanted toadd value without adding complexity.Our one page solution provides

managers with the essen-tial information abouttheir groups surveyresults, including exactly

which actions they couldtake to improve scores next

year. Managers at Avonare now held accountableto increase their surveyscores by a set percenteach yearan objectivehard-wired into every

VPs and GMs performance plan.3. Define the field. We must define

the boundaries of what we do, stakingclaim to those areas of HR where wehave the greatest potential impact. Wecant improve the quality of what we

do until we agree on what it is. Weneed to set boundaries. Our field isemerging without direction or a com-mon definition of what we do. TMprofessionals might own any combina-tion of talent reviews, succession plan-ning, executive education, recruitingand coaching, with performance man-agement, employee engagement andtraining often in the mix. The soonerwe identify the key practices, process-es and outcomes we want to own, thefaster we can institute improvements.

We need to address a few missing

things: business knowledge, passion,production mindset, and simplicity. Ifwe can change how we do TM, wellincrease the effectiveness of what wedo. If we set high standards, considernew ideas, and hold ourselves account-able for TM practices, well progress. LE

Marc Effron is VP of TM for Avon Products and author andspeaker on HR issues. Email [email protected]@effrons.com, call 1-212-282-5503 or visit www.marcef-fron.com. Miriam Ort is Senior Manager of TM for AvonProducts. Email [email protected].

ACTION: Become a TM all-star.

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

MANAGEMENT TALENT

by Marc Effron and Miriam Ort

THESE SHOULD BE HEADY TIMES FORTalent Management (TM). CEOsfueled by Good to Great dreams areinvesting in building leaders, recog-nizing that great talent is their onlycompetitive advantage and that grow-ing their capabilities is the sure pathto success.

With talent issues like these, TMpractitioners should be all-stars.

Instead, many are underperforming.Their bold promises to build leadersmore quickly and effectively, if giventhe chance, are showing little effect.Their practices still reflect the samebloated, impractical approaches thathave long caused line managers eyesto roll. Companies expecting their TMprofessionals to deliver superior resultsare discovering that theres simply notenough talent in talent management.

Executives are looking to HR andTM to develop great leaders. If wemeet this goal, well redeem HRs tat-

tered reputation and change HRs seatat the table from a high-chair to anarm chair. Success will also establish usas the driver of the talent engine. Wewill shift our reputation from beingthe provider of assessments and toolsto being trusted advisors on importanttalent decisions and making a positiveimpact on business results.

Our risk is as large as our opportu-nity. Failure to deliver will be seen asyet another sign that HR doesntwork. TM will be dismissed as anoth-er HR fad, another failed quick fix

brought to you by those folks whojust dont seem to get the business.

Lets be transparent about our chal-lenges. We emerged from the soft sideof a soft profession. Few of us havehad accountability for a balance sheetor responsibility to make a payroll.We dont seem passionate about thecommercial aspects of our businesses.We havent crafted HR processes thatconsistently build great talent. Our solu-tions are too academic and complicated;yet we insist these solutions, even if

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need to rethink how to best developthe next generation of HR leaders.

One option is to put effective globalline managers in charge of HR. Itwould be rare in marketing and out ofthe question in finance to choosesomeone with no experience in thefunction for the top job; yet in HR thisappears to be a growing trend as thedemands for good people manage-ment increase. Microsofts choice of

Lisa Brummel, one of the firms topproduct managers, to revitalize the HRfunction and stem the loss of talent tonew competitors provides a high-pro-file example. This approach has manyadvantages: identifying someone witha strategic mindset, detailed knowl-edge of the business, and the respectof all workers to lead people manage-ment. What is needed, however, is ameans to bring this leader up to speedquickly on the most effective globalapproaches to people management.

A less radical alternative is provid-

ing HR professionals with the strategic

capabilities, international and line man-agement experiences, and tools neededto become effective partners for busi-ness leaders. They must also be equip-ped to manage their careers effectively.

A New Approach

Weve developed a unique approachto developing HR leaders. The newglobal Executive Masters in HR Lead-ership (EMHRL) is designed to devel-op the capabilities of those charged tolead HR. It has a global scope, focuseson strategic HR, and builds a cohort of

change agents who apply the knowl-edge in real-time for major impact.

1. Global in scope: The programseight intensive modules are taught infour, two-week blocks in key locationsworldwide that facilitate understandingthe evolving global competition for tal-ent. Time in the classroom in EasternEurope (Prague), India (Mumbai), China(Shanghai) and the U.S. (New York) isblended with visits to organizations andtheir leaders in each location.

2. Strategic focus. EMHRL focuses

Advanced TM

LEADERS TODAY MUST

face the complexi-ties of managing a

global workforce and building effectiveglobal organizations. IBM and GeneralElectric now derive more of their prof-its from knowledge-intensive, highvalue-added services delivered by aninternational workforce. IBM alreadyhas 60,000 individuals working inIndia, targeting growth to 100,000 by2010. GEs back office business servicesoperation was so successful that itspun it out as a separate business.

As these trends continue, the peo-

ple who generate distinctive newknowledge and build customer andsupplier relationships worldwideaccount for more of the net worth.

Talent management (TM) is at thecore of many of the challenges facingleaders: How to attract, develop, moti-vate, and retain individuals globallywith the core capabilities matched totheir firms strategy and needs?Where to locate diverse operations toget the best mix of talents at the bestprice? How to quickly meld togetherpeople from different continents and

cultures into effective virtual teams?Often the people who have prima-

ry responsibility for TMheads ofHRlack the strategic capabilities tobe a full member of the leadershipteam. The shortage of strategic HRleaders is likely to increase in thefuture because of the major transfor-mation of the HR function. The com-bination of internal restructuring,automation, and outsourcing is elimi-nating many routine, transactionalpositions and increasing demands onHR professionals to build their strate-

gic capabilities. These same changes,however, have disrupted the tradi-tional career paths through whichindividuals acquired the diverse expe-rience and skills needed to becomeeffective business partners. In theshort term, organizations may copewith this challenge by hiring mid-career individuals who have acquiredthe needed experience. But as theworkforce ages and the supply of tal-ent with the required skills becomesscarce, employers, and universities

on the strategic aspects of leading peo-ple and measuring results, rather thanthe traditional components of the HRfunction. Anne-Marie Leslie, describedhow her participation in an earlier ver-sion of EMHRL helped her to build thecapabilities needed to become theSenior VP of HR for Cochlear, anAustralian medical device company.

Charlie Tharp, who was the SVP ofHR for BMS and Saks 5th Avenue

before becoming the President of theNational Academy of HR, was onearchitect of the program. He notes:EMHRL compresses into a nine-month program a focus on the areasthat are the key priorities of Chief HROfficers and blends top academic train-ing with first-hand learning from topHR leaders. The program wasdesigned by CHROs for the develop-ment of next-generation HR leaders.

3. Clear target audience. We select acohort of individuals from top compa-nies and countries around the world

who have the potential to become globalleaders of HR and then bring themtogether for eight weeks: Ive learnedso much from my fellow students, saidKurt Roggin, an HR Director at Johnson& Johnson. We function as a team anda community and routinely contact eachother to get advice on how to handleissues in our jobs and to share tools, bestpractices, and experience. Ive learned somuch from them about different cul-tures and doing business in a global (notjust multi-national) environment.

4. Immediate impact. While building

more effective global HR leaders is thelong-term goal, companies expect to seean immediate return on the large invest-ment in time and resources that EMHRLrequires. Thus, all participants mustintegrate what they are learning in real-time into a capstone project thataddresses some key elements of howtheir firms manage the global work-force. The modules on WorkforceStrategy and Strategic Human Capitalhave provided me with a framework Ican use to transform our business andalso develop the capabilities of my HR

team, said Roggin, whose project isfocused on building a talent brokeragesystem for the region. This is one of thehighest-priority issues for our line lead-ers, and the fact that my project directlycorrelates to a key business need illus-trates what makes the GEMHRL pro-gram so unique. LE

David Finegold is Dean of School of Management, Rutgers,State University of New Jersey. Call 732-445-5993, 732-932-4767, or visit www.smlr.rutgers.edu.

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