Book Excerpt: High Commitment High Performance

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Instead of looking for saviors, we should be calling for leadership that will challenge us to face problems for which there are no simple, painless solutions."

Hubris causes heroic leaders to impose their strategic and organizational solutions without testing either their validity or the company's capacity to execute them. Imposing ideas from previously led organizations or copying from other companies fails to honor the past, fails to mobilize people to tackle tough problems, and reduces the willingness of people throughout the company to partner with the CEO.

Heroic leadership fails to integrate listening and decisive action into a seamless, iterative, and continuous learning process. Most important, heroic leadership fails to perform the central function of leadership—engaging employees authentically in a process of organizational learning and development from which they as leaders also learn.

Our findings are that CEOs can learn a great deal from those at lower levels who are in touch with the day-to-day realities of the marketplace and the efficacy of the organization in execution. Andy Grove, the cofounder and long-time leader of Intel (INTC), discovered that lower-level managers recognized long before he and his senior team did the strategic inflection point that Intel faced as the market shifted away from memory chips to microprocessors.

With that discovery, Grove began to reorient the focus of the company. The leaders featured in this book—Don Rogers, Henry Gullette, Grey Warner, Chris Richmond, Scott Wright, Ed Ludwig, and Archie Norman—are all strong leaders who motivated a collective process of learning because they knew they did not have all the answers and needed others to help move the organization forward.

To share the responsibilities of leadership, transformational CEOs or business-unit general managers develop and come to rely on their leadership teams. This requires a sustained effort to build that team and develop together a vision of the company—its purpose, its strategy, and its values, as well as the legacy they want to leave and the principles for organizing and managing they will employ.

Most important, HCHP leaders recognize that the leadership team they must develop is composed of not only their direct reports and a larger circle of key managers but also the board of directors, who must share the senior team's vision, values, and strategic intent. The process of transformational leadership I discuss in this chapter applies to the CEO's relationship with lower levels as well as his relationship with the board. In a recent study of HCHP chief executives, my colleagues at TruePoint Center for High Commitment & Performance and I were struck by how much care these leaders take to partner with not only with their own teams but also their boards. Indeed, the leadership model proposed here is one that leaders in the corporation's multiple subunits will ultimately have to adopt if the transformation of the larger organization is to be complete.

Unfortunately, the charismatic-heroic model of leadership is the dominant perspective in selecting CEOs, according to the research by my colleague Rakesh Khurana. He finds that when a crisis of performance hits, a company board of directors inevitably does the wrong thing. They go "in search of a savior"—a charismatic and dynamic leader who is associated with a celebrity company or CEO.

Khurana shows that in many cases this approach fails to deliver a sustained turnaround. That was exactly the story at Hewlett-Packard (HPQ), where an ineffective board selected Carly Fiorina, a charismatic leader who not only failed to turn the company around but also managed to liquidate the HCHP culture built by its founders and successors. The failure of heroic leaders to be open to the truth about the efficacy and ethics of their business model and organization is certainly a major reason for the failures of banks and mortgage companies in 2008.

In a systematic study of senior General Electric (GE) executives who became CEOs at other companies, my colleagues Boris Groysberg and Nitin Nohria found that the performance of these transplanted senior executives was far from uniformly positive. Success depended on a good fit of the executive's leadership skills, values, and business knowledge with the company's business and organization challenges.

Being a celebrity leader who comes from a celebrity company was not the key factor. And what if the fit of the CEO is not perfect, which is usually the case? Then the leader's ability to engage people and learn is even more crucial.

The leadership and learning perspective I am proposing requires leaders to embrace paradox. On the one hand, leaders must have strength of purpose. They must have a point of view about the general direction of the company and must be willing to articulate that view clearly and firmly if they hope to bolster employee confidence and raise hope that successful transformation to HCHP is possible. On the other hand, leaders must also be able to suppress their egos and enable others to lead. Jamie Houghton, the successful former CEO and chairman of Corning (GLW), concludes from his experience that leaders are better able to listen and learn if they are not too sure of themselves. And, he notes: "History tells us that those in leadership positions who do not listen eventually fail."

Michael Beer is the chairman and founder of the management consulting firm TruePoint, and also serves as the Cahners-Rabb professor of business administration emeritus at Harvard Business School.

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