systematicHR

A few months ago, Fast Company pushed out this article on leadership. I’m going to follow this with my thoughts and examples from several interviews that Harvard also published in the last year. Just so you know, the Fast Company article refers to a HBS published book that I don’t have and can’t refer to otherwise (Harvard Business School Press: In Their Time: The Greatest Business Leaders of the 20th Century). I hope you enjoy.

What is a leader? Intuitively, I think we all know there is a difference between a leader and a manager. Leaders have a unique ability to inspire us and somehow we WANT to follow their direction. A leader does not have to be the head of a department – they might be your peer, but they consistently come up with great ideas, inspire the rest of a team to innovate or collaborate. However, sometimes they are great leaders simply due to their ability to manage and direct effectively. Today, we’ll talk about leadership generally.

What are the elements of this alloy we call “leadership”? Certainly, they include vision and integrity, perseverance and courage, a hunger for innovation, and a willingness to take risks. But in building their list of the top business leaders of the past century, Harvard Business School professors Anthony J. Mayo and Nitin Nohria have unearthed an immutable attribute that’s shared by all of the giants of business: They had an innate ability to read the forces that shaped the times in which they lived — and to seize on the resulting opportunities.

Henry Ford, Ray Kroc, Estee Lauder, Jack Welch — these business masters had more than their fair share of what Mayo and Nohria call “contextual intelligence.” That is, they possessed an acute sensitivity to the social, political, technological, and demographic contexts that came to define their eras. And they adapted their enterprises to best respond to those forces. Their outsized success at sensing opportunities and capitalizing on them had a dual effect: Just as the times profoundly influenced these business masters, they, in turn, profoundly influenced their times. ((Breen, Bill, September 2005. ” The Three Ways of Great Leaders,” Fast Company. Retrieved from http://www.fastcompany.com on January 27, 2006.))

Entrepreneurial Leadership:

At the turn of the last century, C.W. Post was an itinerant salesman who traveled through Michigan, which was the Silicon Valley of its time. It was the epicenter of more than 300 car companies, which spawned scores more companies. Entrepreneurship was in the air. Post didn’t directly exploit these technologies, but he did sense a gathering of forces that created the possibility for a new business opportunity.

An entrepreneurial leader’s genius lies in bringing things together in a combination that no one has ever seen before. Post was one of this country’s great business visionaries, but he failed at the managerial act — which is to build a system in the organization that routinizes the entrepreneur’s creation. Post eventually disengaged from the business and ultimately committed suicide. But the company he created, Post Cereals, thrives to this day. Another leadership prototype — the manager — stepped into the breach and through discipline, structure, and organization expanded the platform that Post created. ((Ibid – refers to Harvard Business School Press: In Their Time: The Greatest Business Leaders of the 20th Century.))

The Leader as Manager

Whereas entrepreneurs are company creators and charismatic leaders are agents of change, managers are value maximizers — they make the most out of something that already exists. Such is the case with Louis B. Neumiller, who rose through the ranks of Caterpillar and became its chief executive in 1941. Two months later, Japan attacked Pearl Harbor. Just as C.W. Post used changing demographics to launch the cereal industry, Neumiller seized on the massive geopolitical event that was World War II to build Caterpillar into a global organization.

Soon after the country was plunged into war, the U.S. military called on Caterpillar to retool its operations for artillery production. But Neumiller feared that when the war ended, Caterpillar would be left with the challenge of reconverting itself back to producing heavy earth-moving equipment. He convinced the Army that it was better served by letting Caterpillar continue to manufacture bulldozers and tractors. In the end, his steadfast strategy paid off. The bulldozer in particular was critical to clearing roads and building makeshift landing strips throughout the Pacific islands. Over the next four years, Caterpillar doubled its employment and increased its sales fivefold. ((Ibid – refers to Harvard Business School Press: In Their Time: The Greatest Business Leaders of the 20th Century.))

The Charismatic Leader

Our fascination with the CEO as a celebrity leader dates back to Lee Iacocca. He captured the moment because he saw and seized on a series of secular changes that crept up almost unnoticeably.

First, there was technology. Iacocca understood that the Japanese threat stemmed from a fundamentally more productive way of managing manufacturing, which he’d have to mimic. Then came labor. Iacocca was among the first to recognize that there needed to be a more cooperative compact between labor and management. Under his leadership, Chrysler was the first American corporation to put members of the United Auto Workers on its board. And finally, Iacocca leveraged America’s radically changing demographics. His genius was to see that the baby boomers were starting families, so he bet Chrysler’s future on the minivan. Ultimately, Iacocca succeeded at turning around Chrysler because he acted on all three fronts simultaneously. ((Ibid – refers to Harvard Business School Press: In Their Time: The Greatest Business Leaders of the 20th Century.))

It seems to me that innovative ideas and finding new ways to think about problems are critical definitions of leadership here. Myself, I’m always trying to identify or at least understand what the next great thought in HR is going to be. Today, we have workforce planning and talent management which themselves keep evolving into broader and deeper practices. I’m also a great proponent of using technology for decision support, a concept without enough practitioners but too many prophets.

As HR leaders in our own environments, most of us are challenging ourselves to be great for our companies, to affect the bottom line and improve the work lives of our employee customers. But how many of us are really driving ourselves to be great within our industry, our economy and our world? We can’t all be Post, Neumiller, or Iacocca. Ok, most of us can’t come close. But to be truly great, whether or not we achieve international or local fame, to be truely great we have to try.