IMI: Based on your current work - if you only had 6 words of advice to give a business - what would they be?
EM: Succeed Globally with a Culture Map
IMI: What does this mean?
EM: Today, whether we work with colleagues in Dusseldorf or Dubai, Brasilia or Beijing, New York or New Delhi, we are all part of a global network (real or virtual, physical or electronic) where success requires navigating through wildly different cultural realities. Unless we know how to decode other cultures and avoid easy-to-fall-into cultural traps, we are easy prey to misunderstanding, needless conflict, and ultimate failure.
Yet most managers have little understanding of how local culture impacts global interaction. Even those who are culturally informed, travel extensively, and have lived abroad often have few strategies for dealing with the cross-cultural complexity that affects their team's day-to-day effectiveness.
To help people improve their ability to decode the cultural differences impacting their work and to enhance their effectiveness in dealing with these differences, I have built on the work of many in my field to develop a tool called the Culture Map. It is made up of eight scales representing the management behaviours where cultural gaps are most common.
The eight scales are based on decades of academic research into culture from multiple perspectives. To this foundation I have added my own work, which has been validated by extensive interviews with thousands of executives who have confirmed or corrected my findings. The scales are:
- Communicating: explicit vs. implicit
- Evaluating: direct criticism vs. indirect criticism
- Leading: egalitarian vs. hierarchical
- Deciding: consensual vs. top down
- Trusting: task vs. relationship
- Disagreeing: confrontational vs. avoidance
- Scheduling: linear-time vs. flexible-time
- Persuading: applications-first vs. principles-first
Jack Welch was CEO of GE for 20 years. In a changing world, is he still the model for leadership?[/caption]
When discussing the challenges facing business leaders it seems almost de rigeur nowadays to talk about the level of change organisations are facing.
The challenge to equip leaders to build the future in these uncertain times is certainly daunting, with seismic geopolitical shifts (in this context the Trump administration seems to be the gift that keeps on giving), disruptive technological change (how many of us even fully understand the implications of bitcoin, blockchain and whatever new technology will be unleashed on us next) and even severe climate and weather events.
The very ubiquitous nature of these challenges may however inure us to their real potential as both a threat and an opportunity to affect a true paradigm shift in how we view leadership, a classic case of an issue being undervalued through overuse.
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The Concept of Leadership
From the perspective of the 21st century the development of our concept of leadership is a little clearer than it may have been in the past. From this remove we can see how the largely male, heroic models of leadership have greatly influenced the literature and teaching in this field.
The business leaders who are most often cited, Jack Welch, Steve Jobs etc. are broadly from a similar mould and the models of leadership, with the exception of Servant Leadership (as a servant leader you put the needs of others, particularly team members, before you even consider your own, but how many executives really model themselves on this type of leadership?) extol an assertive, confident, out-going and mainly extroverted style.
In fact, the Myers Briggs type most associated with leadership is the ENTJ (extraversion, intuition, thinking, judgment), which is described as the ‘general’, again exposing the military underpinnings of the leadership canon. We can clearly see this bias in the continuing popularity of books like Dale Carnegie’s “How to win friends and influence people”, the pseudoscience of NLP and programmes that teach executives how to create the right ‘impression’.
Given the genesis of the leadership concept it is understandable that people might misconstrue the notion of leadership presence as the ability to impose oneself (and influence people), but there is real hope that we are about to experience a genuine shift in the paradigm.
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Unhappy Influencers
[caption id="attachment_22617" align="aligncenter" width="600"]
Richard Boyatzis studied how leaders influence those around them and how that effected their lives and careers[/caption]
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Recent research conducted by Richard Boyatzis and colleagues from Case Western Reserve University examined the relationship between the extent to which people adopted an ‘influencing’ leadership style and their later satisfaction with both their careers and their life in general. Interestingly they found a very strong negative correlation between these factors, i.e. the more people adopted an influence style the less satisfied they were with their careers and lives.
Boyatzis and colleagues did not have an objective measure of career success, so one could still argue that the ‘influencers’ did better in their careers, but Boyatzis’ research does tell us that irrespective on how well an outsider might judge your career progress, the ‘influencers’ are less happy about their situation. The researchers concluded that those who adopt an influencing style are pushing on their environment and trying to get more from others, e.g. they tend to show a high need to control social situations.
The crux of the problem, especially in the context of a VUCA world, is that pushing on or trying to control an environment that is in a constant state of flux, verging on chaos is unlikely to be very effective and will certainly lead to people being highly dissatisfied and unhappy in their work and indeed their lives.
Now would be the perfect time for the leadership movement to learn the lessons of evolutionary psychology that success in a changing environment falls to the most adaptable, those who can outlearn their competition.
The Adaptable Generation
This will require a cadre of new leaders who are less ego-identified with success and winning, who don’t see problems as opportunities to impose themselves and demonstrate mastery of the environment.
Rather we will see the emergence of leaders who can go with the flow, adapt to new realities quickly, work through and with others as either leader or follower and pivot gracefully as cherished paradigms fall away and hard-earned experience proves ineffective as a guide to new problems.
There is no doubt that the idea of women in leadership is in the current zeitgeist and may or may not create a fundamental shift in how we see leadership in the future. I am however hopeful, that as the new model emerges we will see less emphasis on the old machismo of the ability to impose oneself on others and on the environment and more emphasis on the willingness to adapt, change and ‘flow’ with emerging realities.
Bruce Lee used to tell his students to ‘be like water’, perhaps that is not a bad metaphor for what leaders will need to become.
Dr Colm Foster is Director of Executive Education at the Irish Management Institute. He has acted as a leadership development consultant to organisations in the US, Asia and Ireland, particularly specialising in Emotional Intelligence.
The next IMI Diploma in Leadership starts on 2nd May, 2018.
[post_title] => 21st Century Leadership: The Shifting River
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My experience working with a wide range of young businesses, from complex financial software through to artisan food producers says, it is easy to get distracted by products and forget that the underlying success drivers are the same regardless of what you make or do.
A visit to The Climbing Wall in Sandyford, a 3 week old fledgling business already packed with happy customers on a freezing January night made me stop to think. What gets customers in this case to a business with no marketing or advertising budget? What separates success and disaster for a young business in the early scary days?
“The wall” is an indoor state of the art climbing wall in Sandyford industrial estate. So, your business is very different, but the same answers apply and will help you succeed early.
- Passionate attention to all customers, including the ones future customers. I dragged along a friend who doesn’t climb, and had no intention of doing so. She instantly felt welcome, even though climbing up the wall until then was something she only does at business meetings. Your customers may come in many forms and will have different needs. See the world from their perspective – are they confused? Scared? Stressed? Finding it hard to park? At the Wall you feel safe and at ease. And yes, of course, she climbed. And is now hooked.
- Create a happy place where staff are as engaged as you are in looking after customers with care. Your staff must feel like a really core part of your baby business. Get them on board and make sure to find ways of harnessing all their bright ideas about how to make your project a success
- Know your customers intimately before you start. Alan and Brian really understand their market, and are well networked. They already understood exactly what climbers want and immediately ran simple high impact events that have built up loyalty, traffic to The Wall and loads of Word of Mouth publicity, always the most powerful form of marketing. This also helps you create a sense of community and shared values among your customer base, so your customers stay longer and believe in what you do. Happy customers come back.
- Be clever about how to position and communicate what you offer: .The Wall makes canny use of social media and press coverage to get the story out in a more targeted and dynamic way than any ad ever will. Network, but be savvy about how you use that precious network.
- Know your competition equally intimately, know when to compete (and how) and when to collaborate. Sometimes collaboration is the right strategy – work together and instead of splitting a new small market you can grow it together, creating greater awareness by acting as a group and attracting more people to a new service or product.
- Good team - make sure all the practical stuff is under control. The top team here includes a marketing whizz and an employment law specialist. They have team skills to make sure the business is set up on a sound financial footing, property and planning skills and expertise to make sure design and operations are top class.
- Finally – do something you love. The chances are you will be very good at it!
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Keeping a ‘Founder’s Mentality’
Retaining the ‘founder’s mentality’ is key for continued success in an organisation, and that it is possible to keep (or rediscover) that mindset, no matter how large and complex your organisation has become.
Small organisations aspire to grow ‘big’ someday, to become a behemoth bestriding the marketplace, their ideas shaping it to their own ends. The problem is, according to Chris Zook of Bain and Company, that when they become successful the growth paradox comes into play – growth creates complexity, and complexity kills growth.
Retaining the ‘founder’s mentality’ is key for continued success in an organisation, and that it is possible to keep (or rediscover) that mindset, no matter how large and complex your organisation has become.
Through their own research, Bain and Co. found that the organisations that were able to retain that entrepreneurial ethos account for 50% or more of the net value creation on the stock market, although only 6-7% of companies keep that entrepreneurial mindset.
Founder-led companies consistently outperform other companies in other areas too. Bain’s research shows between 1990 and 2014, companies on the S&P led by a founder outperformed their rivals by 3.1 times for total shareholder returns.
The bottom-line value is clear.
Diversification to Death
A prime reason for companies losing their founder’s mentality is a redefining of the core mission of the company. Moving away from that core mission is especially tempting over time, often due to the success that your company has experienced. Lego, one of the world’s most famous brands, have gone through a cycle of this diversification and then redefinition back to its core over the last two decades.
At the beginning of this century, Lego redefined themselves from a toy company to a ‘family brand’. This ethos led to the opening of branded theme parks, movies, clothing lines etc. These additional product lines and revenue streams beyond their core mission began to reduce the cash flow in the company – indeed, at one-point Lego found they had only 18 months of cash left.
For a company that has produced 72 Lego bricks for every person on the planet, they were in serious trouble. They have since rebounded, refocussing on their core business and have seen results, but it is indicative that a company that was so ubiquitous and seemingly unstoppable came perilously close to entering a near death spiral due to moving away from what made them great in the first place.
The Metrics for Measurement
Bain and Co. have produced a model to begin measuring, and tackling, a company and how close they are to their founder’s mentality; 1) Insurgency 2) Frontline Obsession and 3) Owner Mindset.
Insurgency is what drove the business at the beginning – the belief they could do something better than the market currently provided. Rarely does a business start off trying to do multiple products and services, but rather focussing on a key deliverable that gives the customer value and the company profits.
When that focus has shifted away from the core business, suddenly the company starts providing solutions in other sectors, not because they believe they can do it better than the current players in the marketplace, but because diversification is seen as something to aim for. This often leads to losing market share in their original product line, while also encouraging new insurgents.
The frontline obsession is inherent in all founders – that believe that the coal face is where the true value of the business lies. A prime example of this is Mohan Singh Oberoi, an Indian hotelier that built his business from the ground up, founding the luxury Oberai Hotel chain. At 92, his son (who replaced him as CEO) would meet his father and find him with a stack of comment cards from customers, making notes as he went along.
This obsession with the ‘real business’, away from profit margins and IPOs, is what will ultimately deliver value across the board, including shareholders.
The owner mindset is where the public envisions entrepreneurs – their aversion to bureaucracy, a bias towards action and risk, and a strong focus on the cash flow and fundamentals of the business. In many ways, it is simply somebody taking responsibility; instead of the bureaucracy you will find in large organisations where employees are only worried about ‘their patch’, the owner’s mindset means taking responsibility for all the business and taking actions to reflect that.
Returning to the Top
A company that has drifted is not lost – it simply needs a shift back in mindset to the core mission and values that made the business successful initially. This can seem paradoxical at board level – it goes against the modern trend to be ‘all things to all’, but could also be seen as a return to a sharper focus on profits, increasing market share and customer satisfaction.
Internal complexity can be a killer for a business, but it is not inevitable. By returning to the founder’s mentality a company can recapture the elements that made it a success, deliver real value to customers and employees, and its shareholders.
This article is based on a talk given at an IMI Masterclass by Chris Zook. A keynote speaker at a wide range of international and business forums including the World Economic Forum, the World Knowledge Forum, the Forbes’ CEO Conference, the BusinessWeek CEO Conference and the Economist Summit, amongst others, Chris has helped companies find new sources of profitable growth for 20 years in his position as a partner in Bain & Company.
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