The aperture for modern ceos

"This book examines and assesses how CEOs defines, navigate and instill key activities of organizational life and provokes and challenges the nature of their practice. In the 21st Century, the Chief Executive Officers role is both complex and multifaceted. As the key architects of culture in their organizations, how their actions, behaviors and mindset are role modeled and perceived is pivotal and how they in turn, evoke leadership in everyone is essential. Along with input from Global CEOs, this book examines and assesses how CEOs defines, navigate and instill key activities of organizational life and provokes and challenges the nature of their practice. It shares practical strategies on how CEOs ways of being can influence and contribute to the adoption and embedment of ways of working that better serve employees, stakeholders and organizations. Ultimately, in the pursuance of healthier organizations!"

Acknowledgments

Introduction: The Paradox

Chapter 1The Foundations

Chapter 2The Leadership

Chapter 3The Intangibles

Chapter 4The New Way

Chapter 5The Future

Conclusion: The Enlightened

Purpose and Vision | Strategy and Structure

What Is the Reality?

Leadership is not an ideology … it is a reality! Leading is not about personality, style, or power

It is about acts of leadership Leading defines a path for your followers and then leads themthrough the “twists and turns” of that path Leading during the good and the bad times Leading

in the face of change and even when the odds are stacked up against you Giving credit andtaking credit when credit is due but also taking responsibility when things go wrong Makingdecisions that are tough and even unpopular, but nevertheless, making that decision!

Employees invest faith, hope, and trust that their CEO can instill a sense of purpose and set avision for their organization Purpose and vision are expedited through strategy and structure so

that the organization grows and delivers safely, sustainably, equitably, and profitably Let’s notallow this faith, hope, and trust to be to no avail CEOs do not need to be technical masters in all

of the functions that make up an organization in its totality, but they do need to have and hold the

“big picture” and have a semblance of understanding on them all As Harvey from the Americandrama “Suits” would say, “It’s your goddamn job to know.”

The leadership reality in this chapter looks at how CEOs lay out and position their purpose,vision, strategy, and structure That is, the foundations on which their organizations sit upon.More so, how these foundations unfold and evolve to best facilitate high performance How, bybuilding on these foundations, a CEO steers and navigates their organizations with humanitytoward a robust trajectory of growth

I am curious as to how these foundations laid down by CEOs for their organizations convert intoaction and how and why the practices and behavioral choices aligned to these foundations aredelivered in the way they are

Do employees understand the reasoning and rationale behind the purpose, vision, strategy, andstructure of their organizations? Are your employees aware of the difference their organization ismaking in the world? Have you painted a vivid and imaginative picture of how the world willlook once your organization’s purpose has been realized? What are the core strategies that must

be undertaken? Do they even care? And what types of structures best support the strategy so thatpurpose and vision are realized?

Ben Page, CEO, Ipsos MORI, encapsulates the seriousness of the foundations laid down by theCEOs through an analogy:

I often describe it using the analogy of a painter The more senior you become the larger yourpaintbrush becomes So you stop doing miniatures and you’re now doing Rothko You can’t dominiatures the size of Rothko’s

Purpose and Vision

“Purpose” continues to take a well-deserved stand at the tables of organizations Why? Because

it is the raison d’être for your organization’s existence Your organization begins and ends with

“purpose”—it provides employees and other stakeholders with meaning and should aptly be atthe front and center of the organization to foster a shared sense of “we’re in this together.”

Keryn James, CEO, ERM, says:

Ultimately it is the CEO’s role to ensure that the purpose is clearly articulated and that the values

of the organization reinforce the delivery of that purpose are lived

A common purpose unifies employees It helps them understand the organization’s direction andhelps to align organizational capabilities to deliver the strategy Purpose provides impetus foraction by galvanizing your employees to do their best work and to see how their role relates to it

It is why we are here and what we are doing to make a difference in the world Therefore, it is

essential that employees and all stakeholders understand the organization’s purpose To this end,

it has to be both resonate and relevant, and CEO Ben Page reiterates this sentiment:

Growing up as a junior in the organization I used to think that mission/values were trite bullshit,but the data show that knowing what is going on makes a 40 percent point difference inunderstanding the goals of the organization Why are we here? Where do we want to go? What

do we want to be like? What are we trying to do? People want to be part of something that isbigger than them

Ben illustrates this by sharing a story,

Have you heard the NASA JFK story? During the Civil Rights movement in the 1960s, PresidentKennedy announced that their mission is to put a man on the moon by end of the decade So hegoes down to NASA space center and he is having a pee in the loo and he asks the janitor who issweeping the floor what do you do and he answers by saying Sir I am working to put a man onthe moon

“Purpose” is beyond maximizing shareholder value It is about “our” value as an organizationand our contribution to the world, over and above products and profits Purpose considers thewhole ecosystem—an ecosystem that embraces a holistic perspective and takes on board,broader societal issues It is the motivating force moving, guiding, and delivering theorganization to its perceived goal It is the driving force and the intangible link that pulls theorganization together to achieve success while connecting, building, and maintaining interestsand relationships among multiple stakeholders

Mark Hoplamazian, CEO, Hyatt Hotels Corporation, advocates that “purpose” considers thewider ecosystem He says:

At Hyatt, we have a purpose statement, which is: “we care for people so they can be their best.”

In this expression, we capture many dimensions We focus on care, not service, which a lot ofhospitality companies have historically focused on We talk about caring for people and not justguests But first and foremost, our colleagues We manage hotels for third party-owners(institutions or individuals who own our hotels), and we have a duty to them so we care for them

as well The other key constituency is members of the communities in which we operate Begood neighbors and good corporate citizens

Alongside the organization’s purpose, unquestionably, a key responsibility of a CEO is todevelop a vision for their organization Vision paints the picture for how purpose will be realizedand sits at the core of the organization’s strategy Vision is what the collective organizationaspires to The CEO defines the direction that they would like their organization to take and thenseeks buy-in from all stakeholders to establish fundamental working principles in the pursuit ofexecuting that vision In my conversations with CEOs, “vision” in terms of setting strategicdirection was stated as a key component of their role as CEO

Xavier Rees, CEO, Havas London and Havas Helia, says that

“Vision” is vitally important for “in your darkest moments and your most exciting moments youneed to remind yourself where you are headed and that you have made progress It serves as aguiding light/ North Star but more than that, it is a great counsel in your own mind when you areeither up against it or faced with the excitement of a huge opportunity.”

Similarly, Luc Van den hove, CEO, IMEC, reflects that:

You always encounter issues and problems but when you lay down the vision you have to aimhigh and especially focus on the sense of purpose of the organization so that people can feelassociated with and be motivated and understand that the organization does not just stand formaximizing revenue but that there is a broader/ higher level purpose for the organization

To develop a vision, CEOs need to determine not only the core competencies of theirorganization but also the core capabilities required to deliver on the core competencies identified.They have to determine whether the vision objectively reflects the organization’s reality as well

as the reality of the environment

Furthermore, the CEO has to sell the vision by articulating why this vision is the best wayforward for the organization and in pursuing it, what outcomes they hope to achieve Articulationmust be emotional and inspirational It must touch both “hearts” and “minds.”

It is then necessary to establish values and behaviors to support the vision Values confirm what

we as an organization believe in and act as a golden thread that can hold the company together.Behaviors support the values by defining the manner in which we will execute That is, act,practice, and deliver on the values and ultimately the vision However, is this the process that isnormally taken? My experience suggests not

Herein lies my first organizational reality for leaders: when I meet with employees and ask them

to help me to understand: (a) what their organization’s purpose is and (b) what theirorganization’s vision is, I am normally met with blank stares My experience is that mostemployees in organizations struggle to both define and echo their organization’s purpose andvision Worse still, even if employees do remember these statements, most are dismissive of theirleaders intent and ambitions lying behind them

This raises a number of questions? Why do these concepts of purpose and vision lose wind asthey blow through the organization? Why are CEOs and their leadership teams not successful indistilling their purpose and vision further down the organization? Why is there often a lack ofclarity throughout the organization on how employees collectively will achieve the purpose andvision? Why is purpose becoming a purpose echo chamber? Why are employees unable toarticulate, aspire, or feel motivated to achieve the essence of these statements? I believeemployees lack the understanding and engagement with their organization’s purpose and visionfor four reasons

First, is a glaring lack of involvement with employees Let me paint a scenario for you Mostlikely, the leadership team have had an away day where both the purpose and the visionstatements were developed More so, it is extremely likely that these statements were created

from a mishmash of other corporations statements that the CEO and his team have seen, evenadmired, but bear no relation to their own organizational context Furthermore, no otheremployees in the organization were consulted; no opinions were listened to; no contributionswere sought! Worse still—and a situation that I have witnessed and personally experienced— theCEO and the “C”-suite direct a handful of consultants and employees to go away and come upwith a vision statement for their organization and to develop the values and behaviors toaccompany the vision When the CEO and the C-suite were asked to be involved in thedevelopment of these statements (which by the way would enable them to have personal buy-inand ownership of these statements), they denied the opportunity with the response “we don’thave time for this … this is what you are being paid to do.”

Let me be crystal clear, the development of the very foundations that the organization sat on wasdevised by a group of individuals with no direct input from the C-suite The rot continued whenemployees were presented with a list of more than 15 behaviors that they were encouraged topractice in the knowledge that in all probability, they would only remember at best 3 of the 15behaviors Tellingly, you definitely did not see any of these behaviors being practiced by anyone

in the senior leadership team! Basically, the vision, behaviors, and values were developed in asuperficial vacuum They were not rooted in the business need or culture, nor were they granularenough to guide action across the organization

The second reason I believe employees lack the understanding and engagement with theirorganization’s purpose and vision is because intentions don’t match with actions Basically, theCEO and his peers will say one thing and then be observed doing exactly the opposite This hadled to the accusation in which CEOs are said to be “purpose washing.” This is they talk aboutpurpose but are not backing up their promises with hard action Nor, have they considered howthey will drive purpose through their organizations or with multiple stakeholders In Chapter 2, Iwill address this leadership behavior But for now, this is mirrored in the findings from Business

in the Community (BITC is a UK organization) inaugural tracker for responsible business thatfound that 86 percent of companies had a purpose statement—but 83 percent had not yet thoughtabout how to implement it Subsequently, these statements appear contrived—developed to bepart of an overarching piece of marketing and brand reputation for the organization

My third reason centers on how the purpose and vision statements are communicated, inparticular, the language that is used to communicate A CEO will stand on a podium at aconference or town hall and communicate the purpose or vision in a way that is often steepedand shrouded in corporate language—language that fails to inspire or emote, thereby eradicatingany shared understanding As Rita McGrath says, “It is only with a basis of a sharedunderstanding of what we’re all trying to achieve here that distributed action is possible Inorganizations that don’t have a clarity of strategy and alignment, decisions get made andunmade, resources are spent on things that are not really relevant, people end up confused, andthe stage is set for the kind of infighting that contributes to the demise of the company.”

Fourth, vision is not intractably linked to a way of being or, to roles? The leaders have notpainted the imagery or indeed the hard evidence of how employee’s roles will help theorganization’s vision to be fulfilled They fail to draw on and emphasize the key acts thatemployees can do, or engage with, so that the ambitions of these statements are realized They

fail to outline the character and cultural attributes of the organization that align with the purposeand vision that will allow employees to see, feel, and engage with the spirit of these statements.Ultimately, they fail to tap into or draw upon the emotional, cultural, and cognitive insights oftheir employees, and in so doing, they damage the cultural fabric of their business.

Above all, the one question that arises when CEOs formulate purpose and vision is can thesestatements be aligned with what the CEO stands for? This is critical because individual andorganizational purpose go hand in hand The CEO needs to unconditionally believe in what theyare advocating, and if this belief is recognized, then stakeholders will be able to both see and feeltheir authenticity If authenticity radiates from the CEO, this will give their “purpose” and

“vision” the building blocks to empower the entire organization Of course, this requires that theCEO really knows himself or herself!

Interestingly, when the CEO gives an insight into their own values, the knock on effect is thatemployees start to delve into their own values and subsequently ask themselves questions suchas: Does the organization’s purpose resonate with me? What do I feel called to do and canthis organization allow me to express this? Do I have the capability to deliver upon the vision? Ifnot, will buying into the purpose and vision help me grow and develop? In essence, when theindividual and organizational purpose enter into resonance and reinforce each other, the leadersare doing their job Otherwise, cognitive dissonance is created

What a CEO Can Do

CEO, don’t complicate … simplify Start with simple questions? It’s that simple Questionsdelve into the root cause that helps us to understand the reason behind what we are doing Itforces us to intrinsically examine how our beliefs and motives will be embedded in what we setout to do Questions address why something has to be done in the way articulated It stimulates

an impetus for action by involving others that creates a sense of ownership This sequencing willprovide a chance for trust to develop

Asking questions of the organization allows us to make sense of the organization’s DNA.Questions that go beyond the organization’s core mandate provoke reflection on your company’sidentity:

•Who are we? Where do we come from? Where are we going? What makes us unique? What can

we be the best in the world at? What can we be passionate about?

By examining the past we better inform how we can begin to make sense of and chart the future.That is:

•Where can we go? Which trends affect our business? What new needs, opportunities, andchallenges lie ahead? What roles that we believe in, can we play that will open up futureopportunities for ourselves?

Essentially, as CEO, you create and instill the organization’s purpose and vision throughinspiration and aspiration:

•How can I better sell the vision and purpose? What is the compelling picture that I have topaint? Is it crystal clear? Does it feel doable? Is it sold with integrity and authenticity?

•Can we relate what we need to do, here and now, to the “big picture”?

•What is our cultural DNA? Why are we in the business that we are in? Why are we doing what

we are doing? What value do we add?

•How do we positively contribute to our communities and society at large? Do we have a goodenough sense of the landscape that we operate in, who the key actors are, and what forces theyare working with? Do we see how the world is changing and the trends that we need to respondto? How do we as a community enable our organization’s business potential?

•How does the organization come together to deal with the uncertainties of life? How do webuild and engender trust among each other and with each of our stakeholders?

Does it make employees aspire to do and be their best in pursuit of the organization’s vision andpurpose? Is it emotive enough to inspire so that it encourages a hefty dose of “buy-in” fromemployees? Can employees find creative expression from the vision and purpose? Are weleading with purpose to address fear, dislocation, and tough choices?

Naturally, there are processes that can help employees to jointly listen and be involved in theirorganization’s purpose and sense of direction, for example, scenario planning and root causeanalysis Scaling up to a large group, I would select processes that are nonhierarchical and bringthe “whole system” into the room These include “Theory U,” “Appreciative Inquiry,” “FutureSearch,” “World Café,” and “Open Space.” And finally, note that while a vision is normally setfor the long term, it is not set in stone It can evolve and be fine-tuned and updated

Strategy and Structure

Strategy is a well-known word in organizational rhetoric In fact, many times a day you will hearemployees in meetings around the world loosely say “let’s come up with a strategy.” However,alarmingly, employees also tend to interpret strategy and initiatives as one and the same thing.They are not Initiatives directly support an organization’s strategic goals and are not thestrategy Which leads me to ask, has strategy and the strategic process lost its way and becomeopen to misinterpretation? I believe so and I will explain my rationale shortly

For clarity, strategy is simply the direction and ensuing action plan for what the business needs

to accomplish to service ambitious goals in the long term so as to grow and beat the competition

In other words, strategy is knowing where we are at (point A) and where we need to go (point B)

so as to grow and develop Effectively, the mandate of strategy is to solve a problem What do

we need to do? How do we get there? Who is involved? And when does it happen? Strategyoffers a formal logic for the company’s goals and orients people around them It provides clarityand focus for collective action and decision making The strategy helps to determine businessand operating models, a product road map, and a view of partners, competitors, and customers.Once the plan has been established, then the set of choices and steps that the organization needs

to take to mobilize people and achieve the strategy are identified That is, assuming strategy hasbeen aligned to the purpose and vision, and goal setting has occurred, then analysis, formation,implementation, and monitoring follow.

Strategy is finding that equilibrium and balance that enables the organization to focus and alignits purpose and objectives with its practice Whether strategy is evolving, emergent, deliberate,analytical, visionary, transformational, reactive, experimental, thoughtful, or a collective process

— organizational life begins and ends with strategy Without strategy, operations and tactics areincoherent Add into the equation other strategic moves that can push the original strategy.According to research by McKinsey, five bold strategic moves best correlate with success:resource allocation; programmatic mergers, acquisitions, and divestitures; capital expenditure;productivity improvements; and differentiation improvements

In recent times, the ideology and practice behind strategy has become both abused and somewhatconvoluted Strategy has at times lost its way in the organization and subsequently lends itself to

be open to misinterpretation and misunderstanding This comes down to the way it is articulatedand implemented Why so? Because somehow CEOs and their organizations have allowedstrategy to become more complex than it need be which, increasingly, has led to the frustration

of many who are trying to operationalize it

CEOs and their teams have mapped out series of complicated plans by recklessly tossing up intothe air, trends that appear grandiose but remain meaningless because they are not positionedwithin the context of the organization and not understood by the critical mass Words designed tomake leaders sound smart, such as “value added”; sustainability; lagging indicators; earningsbefore interest, taxes, depreciation, and amortization(EBIDTA); cost leadership; empowermentevaluation; segmentation; and differentiation, are frequently weaved into discussions that remainmeaningless

Furthermore, the measures (Key Performance Indicators [KPIs], Objectives and Key Results[OKRs] The Balanced Scorecard, etc.) that indicate whether the strategy has been actioned andwhether targets have been met do not always hold people to account That is, accountability isnot a defining feature in many organizations toolbox

Another factor that signals to me that strategy has lost its way in organizations and thus open tomisinterpretation and misunderstanding are due to the numerous questions posed by stakeholdersthat remain unaddressed when a CEO outlines his strategy Questions such as: Why are wepursuing this strategy? How was this strategy devised? What does this mean for ourorganization? Why now? What is the imperative? What will be different? Does the strategyestablish clear expectations for the business? What are the fundamental working principles? Howwill we execute? What does this mean for me in my role? How will I be impacted and measured?Why should I care?

Also, often missing out of the strategic equation is the attention paid to how an organization’sstrategy impacts on the organization’s wider ecosystem—an ecosystem that evolves Forinstance, what is the impact on your external agents such as suppliers, investors, governmentagencies, customers, and so on? As CEO, Keryn James astutely comments, CEOs need to:

Be externally focused … as a CEO you have to know how the market is changing; you have tounderstand what investors think; you have to understand what clients think; you have toappreciate what is shifting and moving; and how do you respond as an organization It is reallyeasy to get trapped on the inside of your business and not be externally engaged.

Added to issues of poor articulation and lack of accountability, when faced with financial andshareholder pressure, CEOs will often put the short-term results of the organization ahead of thelong-term needs of the organization and subsequently strategic intention gets swallowed up inthe short-term pressure cooker Vas Narasimhan, CEO of Novartis, and Michael Kloss, CEO ofPHC Group, are cognizant of this issue:

Narasimhan refers to:

Keeping a long-term perspective even when the pressure is intense to move to short-termorientations

He goes onto say that

in the end we are CEOs for a short blink of the eye … Novartis has a 250-year heritage sothey’ve been CEOs before me and there will be CEOs after me, so it’s to keep the long run inmind It’s important but not easy to do

Likewise, Kloss provides a practical approach:

I believe you always need to be able to zoom in to have enough understanding of something andthen zoom out to seeing the company many years from now and hopefully use that to provide theright strategic guidance to get us there

Research based on McKinsey data sources found that when companies look forward and manageover a long-term horizon, they outperform their industry counterparts on key financial measures.McKinsey defined long-term focus by five measures of a company’s orientation, includingsustainable margin growth, earnings that track cash flow, and investments that are moreconsistent and larger than those of companies managed for the short term As CEO, have youhelped your employees to comprehend these key focus areas?

Bluntly put, strategy needs to be grounded in rational evaluation of the market and businesspotentials and to look forward and manage over a long-term horizon It is not only aboutshareholder return, topline growth, and profitability The strategy must be holistic in reflectingthe multifaceted nature of our society, and the CEOs that I met with advocated for a change inthe organization’s business model to one that was more agile—a model that reflected societieschanging needs

This leads me to a key point about strategy—most employees would not be able to articulate thestrategy or begin to rationalize how it relates to them You might question what lies behind mycynicism Simple: I’ve observed it I’ve observed that for employees at the front line, strategyfeels remote from the realities of their daily life in the organization They feel that the strategy

has been devised in an ivory tower with no reality of going-ons and happenings on the ground.That it has been devised mainly by those insistent on angling for power, position, and status.For middle managers, it presents a minefield of emotions as they are often trapped in a game of

“duck and dive.” That is, they are preoccupied with the day-to-day issues of keeping operationsrunning while moving from one crisis to another They are often fatigued of the stream ofstrategies and initiatives launched and are used to contradictory instructions emulating from theC-suite Tied into this equation is the middle managers conflicting dilemma of their integrity andcommitment to the organization on the one hand and impossible demands on the other hand.Make no mistake—strategy is a dream until it is actioned and transitioning from dream to actioncan become more complex when it is confounded by the power and dynamics of anorganization’s culture and more so, the complexities of employees emotions Boris Groysbergand colleagues write “whereas strategy is typically determined by the C-suite, culture can fluidlyblend the intentions of top leaders with the knowledge and experiences of frontline employees.”And here lies the complication for strategy—culture and structure! As CEO Ben Page states:

I’m very keen on the Peter Drucker quote that “culture eats strategy for breakfast and then hasstructure for lunch.”

Structures typically take the form of divisional, functional, or matrix, and for decades, these sitwithin our most popular organizational structure—the hierarchy—layer upon layer of levels.That is, person A reports to person B who reports to person C and so on with each level ascribed

a particular status and associated rewards The higher up the hierarchy the more status andincentives you are rewarded Sitting at the top of this structure is the CEO who will have hisdirect reports (members of the C-suite) reporting to him

Nevertheless, all have at their heart, as is often described by employees, a “them” and “us”maxim The relentless “pull and push” people dynamic in organizations that until recently hasremained largely unquestioned

One CEO who has questioned the legitimacy of our preferred hierarchical structure is MartinSorrell (former CEO of WPP and CEO of S4 Capital) He says

Agility is the key corporate attribute now, and that’s about strategy and structure You devise thestrategy, yes, but you implement it through structure There’s so much complexity in the holdingcompanies—you have a brand matrix, a geographical matrix, a functional matrix, a client matrix

—there are so many things your head is spinning And then you duplicate it all It’s intentioned, but it breeds sycophants and bureaucrats, it doesn’t breed an agile structure

well-The CEOs that I met with echo Sorrell’s viewpoint For example, Adnan Albahar, CEO, well-TheInternational Investor, says:

There is no right or wrong way Just keep your organization decentralized, flat, unstructured forfast-changing circumstances and when your edge has to be there

As times change and the gig economy becomes ever present, the percentage of workers who arefreelance instead of salaried grows each year To accommodate this change as well as other ways

of working such as co-opetition, a few brave organizations have experimented with other types

of structures such as flat, networked, circular, organic, viral, partnerships, and associates In themain, these types of organizations are self-organizing, nonlinear, and adaptive systems Thesefluid and flexible structures are emerging (and rightly so in our new world), but they are few andfar between, and indeed, it is rare to find organizations that explore and utilize them particularlyonce an organization reaches a population size of over 50 employees

Worryingly, given the comfort that organizations have with the hierarchical structure, it begs thethought as to how many CEOs consider whether their own organizational structure is the beststructure to support their purpose, vision, strategy, and more so Is the structure working andmaximizing their businesses potential? The evidence is that few CEOs can begin to envision how

to adapt their organization’s structure

So why does the typically bloated hierarchical structure continue to be trusted when they arerenowned as breeding grounds for bureaucratic decision making and communication patternsthat harbor functional silos with corporate pecking orders? Structures where resources and powertend to be distributed unequally based on roles and silos; structures that talk of low-skilledworkers whose contribution is often not valued; hierarchical structures that are underscored byfear, rigidity, apathy, and timidity; where maximum conformance is the rule and dissenters aresilenced; group think and its resulting biases are allowed to flourish; taking the initiative isviewed with suspicion and hostility; and politicking is valued over competence

As Margaret Heffernan in her book Wilful Blindness says, “What hierarchy does to identity,

bureaucracy does to work: turn it into an objective process of standardised transactions whosemeasurements and data require as little humanity as possible.”

Gary Hamel offers us the concept of “bureausclerosis.” He says “bureaucracy saps initiative,inhibits risk taking, and crushes creativity It’s a tax on human achievement.”

The question therefore remains why, given the known constraints of hierarchical structures, doour organizations remain persistently wedded to hierarchy? Even the CEOs I met with nodtoward a network organization, but for many, their structures are rooted in hierarchy Whywouldn’t a CEO encourage a structure that is agile? One that is flexible and adaptable,networked, and collaborative; one where the CEO is accessible and not shut away in an office,never to be seen by their employees; one that is biased toward equity and meritocracy in whichemployees are free to exchange ideas because the structure reinforces collaborative and risktaking behaviors; a structure that enables an employee to challenge conventional wisdom andgrow rather than stagnate; a structure where motivation is intrinsic because employees are trustedand leadership is distributed; and one that promotes shared interests A structure built on trustand transparency; a structure that can mold and adapt to our ever-disruptive world that we livein

Keryn James, CEO, ERM, also provides another lens as to why organizations need to reviewtheir structures She says:

The nature of work is changing So the normal traditional structures that have guided how peoplework for the last century are changing as a function of technology but also as a function ofgenerational and cultural changes … So CEOs are going to need to understand that.

She contemplates:

how do you build a flexible organization?

Of course, some would argue that hierarchical structures have their benefits: benefits such assignature processes that permit standardization, routinization, consistency, and coordination andinstill discipline and efficiency In addition, from a psychological perspective, as Heffernannotes, “humans are conditioned with a need for order and these types of structures are seen aspromoting harmony even if that harmony barely skims the surface and is a platitude for whatreally lies beneath.” At the end of the day, we can conclude that hierarchy is harmful

Worrying still, both Francesca Gino and Tomas Chamorro-Premuzic speak of the prominentfeatures that are characteristic of individuals in our hierarchical structures—that of beingtalkative, loud, and self-promoting and who are typically men These traits are likely to beperceived as more valuable than the quiet, self-reflecting, and humble persona, and subsequently,the wrong people end up as leaders Even more pessimistic, these hierarchical cultures are linked

to low job satisfaction, morale, and motivation and reduced employee loyalty and more stressand anxiety among workers Hierarchical structures do not fit well with empowerment anddiversity In fact, as Max Weber writes, “Bureaucracy develops the more perfectly the more it isdehumanized.”

In recent times, learning organizations, high-performance teams, self-managing work teams, thelean start-up, and agile teams have all been advocated as newer types of structures, but CEOsremain resistant to them Why? Why wouldn’t they want to have an organization that harnesses aculture of experimentation and equity; where community, courage, and compassion flourish;where openness and transparency abound; and all take ownership for its success?

In our reluctance to move the dial and explore differing structures, we might be forgiven forthinking that there are no alternative and viable options that can move organizations frombureaucracy toward fluidity and flexibility … but there are: As mentioned: “Hub and Spoke,”organic, circular, flat, and so on And there are other types

A relatively new form of structure is the learning organization This structure constitutesinterdependent networks of individuals and teams where creative sharing, reflection, andempathetic communications are encouraged and highly valued Leaders lean toward servantleadership while enabling others to lead collaboratively, and there is a preoccupation with quality

of interaction throughout organization and impact of organization on quality of life

Luc Van den hove, CEO, IMEC, recognized this when he spoke of IMEC’s ambitions:

There are new styles of leading/managing for the future We are moving away from top-downmanagement style toward a model with more enabled people, embedded in a more networked

organization In a Research and Development community, our mission is to provide Researchand Development services and it is clear that the old style of silo approaches and sequentialinnovation, passing the ball from one department to another, is old style What we need now is amore networked organization that builds on multidisciplinary skills So bringing together peopleand making sure that people take their own responsibilities So engaging the organization is veryimportant.

Other newer forms of structures are “Holacracy,” “Teal,” “Popularity,” and “Agile.” Thesestructures are all characterized by self-organizing self-management attributes that confer decisionpower on “cross-functional or fluid teams,” “circles,” “pods,” or “cabals” rather than individuals.They are designed to govern themselves, and leadership is distributed among roles, notindividuals (people usually hold multiple roles on various teams) Leadership responsibilitiescontinually shift as the work changes and as teams create and define new roles Their ambition is

to solve complex problems iteratively and adaptively with rapid and flexible responses tochanging customer needs The practices that these newer forms of structures enable areautonomy, not dependency; integration not silos; flow not obstruction; targets with purpose andsustainability not top-down prescription; and fiscal-year orientation

One newer type of structure that has had unprecedented buy-in (primarily from start-ups) is amethodology called the “lean start-up” proposed by Eric Reis Its key proponents arehypothesizing, test/ experiment, iterative design, learn, listen to customer feedback, measure, andemploy quick responsive development This practice of failing fast and being responsive tocustomer feedback allows them to quickly decide on whether they need to adapt and pivot theirstrategy and capabilities

And let me be clear: self-management does not mean that organizations combust and go into freefall They still champion reliability in terms of generating growth and return for shareholders,adhering to regulations and maintaining stable employment levels, while for employees it meanshaving a stable working environment, access to critical resources, and clear goals andresponsibilities The key is that adaptability is woven into their DNA be it, in making smalladjustments to products or services to meet local needs, or fundamental shifts in strategy orcapabilities

Examples of organizations that practice self-management are the American multinationalsupermarket Whole Foods Market, Timpson, the UK’s retail service provider, the Swedish bankHandelsbanken, Buurtzorg, the Dutch Health Care provider, and Chinese multinational worldleader in white goods, Haier

CEO Zhang Ruimin of Haier with whom I met leads an open ecosystem that utilizes a networkedstructure and has revenues of up to $40 billion The organization has a global workforce of 8,000employees that is divided into 4,000 microenterprises (MEs), and it was this uniqueorganization’s design that was best prepared to adapt to the pandemic crisis of 2020

A deep dive into Haier’s world displays a worldwide entrepreneurship movement that puts theuser front and center Indeed, CEO Ruimin’s mission is to demonstrate that organizations can be

rid of the hierarchical structure and its accompanying bureaucratic work practices and bereplaced by a humanized management model.

This human-centered approach translates into CEO Ruimin’s Rendanheyi business model.INSEAD Affiliate Professor of Strategy Felipe Monteiro explains the model: “‘Ren’ foremployees; ‘Dan’ refers to user value; and ‘Heyi’ is the connection between each employee andthe needs of the users With Rendanheyi, each employee can create value for users or customerswhile also realizing his or her own value.” Rendanheyi advocates open innovation utilizing userfeedback from social media sites and crowdsourcing, MEs are free to buy services, or not,internally or from external providers, objectives are set “outside in,” empowers its owners tomake large and small decisions including on people and compensation, strategy, and distribution

It focus of the organization is on the Internet of Things (IoT) as a community endeavor, and itsway of working posits an iterative process of imagination, experimentation, and learning

CEO Zhang Ruimin shared with me that Haier has only three types of workers: entrepreneurs,

ME owners, and platform owners Entrepreneurs can group together to set up an entrepreneurial

ME (i.e., self-organizing) MEs can spontaneously join together to evolve into an ecosystemmicrocommunity (EMC) to optimize customers’ experience and create greater values forcustomers Haier completely disrupts the traditional organization as these three roles are nothierarchical, but exist to support a shared objective from different dimensions In so doing, Haier

is a decentralized organization with distributed leadership CEO Ruimin asks CEOs to considerthis as a new way of doing business:

First, the new generation of CEO should forget the way business is done in today’s world Theyneed to abandon the traditional management model The management guru Peter Drucker back inthe year 2000 described business, as we know it, will disappear in 25 years Therefore, there isthe need to forget the current business model because this is obsolete We need to transition into

a network organization to be consistent with this era There is a need to research a new way oforganization commensurate with the network era “Second, forget that you are a CEO Youmust know that everyone in the organization is a CEO of their own Everyone can create his orher value In big organizations for the 21st century, we can all be CEOs These are multiculturetimes.”

I asked CEO Ruimin how does the Rendanheyi business model take into account the very humanattributes of individual bias, subjectivity, competitiveness, self-serving, and so on, and in turn,how do employees adapt to this structure and way of working? He was very clear that Haier’snetwork model stood on the shoulders of dignity:

Fundamentally, every human being deserves dignity There is a need for them to accomplishtheir own values So there is space for every individual to have his or her own value This isdifferent to the Hypothesis of Economic Man In other words, it boils down to financial gainversus dignity Everyone is his or her own person, as people want dignity This is universal

He stated that many an organization had visited Haier to observe and learn from them, but fewhave had the courage to deviate from the familiar hierarchical structure

CEO, Allow your strategy to come to life through a fluid structure.

What a CEO Can Do

Consider this: what if, on a thorough understanding of purpose and vision, the employees wereempowered to devise a strategy that best aligned with the company’s products and services andthen implement it? A process that normally might be undertaken by several consulting firms for

With guidance, we identified service segments and moved toward a differentiated and distinctiveoffer We asked them to assess the organization’s capability, structure systems, and processesthat would enable the strategy, and finally, we sought volunteers from across the organizationand introduced them to a series of change initiatives that would deliver the offer to the customer.All we asked is that they keep existing and potential customers front and center of mind as part

of the process Guess what happened?

We had energized, committed employees who passed on their energy and commitment to otheremployees so that the spirit flowed through the organization I acknowledge that at times it waschallenging, particularly when we needed to create functional structures to deliver the newstrategy But saying goodbye to the old and stepping into the new did not faze the employees—they were all up to the challenge that totaled three years!

An important element of strategy is implementation, and the structure of the organization plays akey part as to how successful implementation will be The structure of an organization will come

to define what get’s done and what doesn’t in an organization, and as this case study highlights,

if the structure is nonhierarchical and empowered, strategy implementation gets done

So how can CEOs make purpose and vision, and strategy and structure more accessible andengaging for their employees? Simple, begin by asking the following questions:

•What are our core competences and how do they help our organization to be competitive in anemergent marketplace? Mark Hoplamazian, CEO, Hyatt Hotels Corporation, advises:

Identify key needs and opportunities that your company has and then figure out how to addressthem in ways that benefits the communities that you operate in and societies at large It adds anextra benefit of momentum, enthusiasm, pride, and commitment to the company At Hyatt, we

have turned to key issues in the world today—the significant wealth, skills, and income gaps Weare focusing on individuals outside of the workplace and outside of school system and bringingthem into the workforce This program is called RiseHY, and it includes a commitment to hire10,000 young people by 2025 We are also making sure that we are helping to set the conditionsfor employment for those communities around the world.

•What are the key economic indicators that we should concentrate on? Are we focusing on ourpain points?

•What of the customer? How are we tailoring our service offering for our customers?

How are we shifting priorities quickly to create new business models? In tune with thisrecommendation, both Keryn James and Søren Skou are mindful that organizations need to havethe ability to flex their business and operating models:

We live in an incredible unpredictable, volatile world Whether this is from a geopolitical/macroeconomic/environmental point of view For example, climate change, which is critical to our business, is driving very different responses from businesses, it is changing operational models for businesses, its changing strategy for businesses and I think that the combination of these three things and the polarization of society more broadly has created a context in which businesses are operating which has far less certainty to it than existed four years or even 20 years ago And therefore, I think that CEOs need to be able to build strategy and build businesses with operating models that have a far higher degree of flexibility built into them … gone are the days when you developed a strategy and reviewed it five years later The cadence with which you review your strategy has got to be rolling because the change is so quick now.

—CEO Keryn James, CEO, ERM

So you have to have a much more agile way of thinking When I went to MBA School 20 years ago, the whole thing was to develop a business model and find a business system that works and

is profitable and then execute the hell out of it This is valuable and something you have to do to create good returns but it cannot stand-alone You need the agility and forward thinking It goes back to being curious this has to be over emphasized Otherwise you can quickly find yourself in

a situation where you … We are also competing globally and it take many more things to understand and keep abreast of and the implications and your responses to this.

—Søren Skou, CEO Maersk

•Is it time to put aside forecasts and focus on dashboard? The notion of forecasting acrossaspects of life in disruptive times is questionable Our environment dictates that it is important tofocus on metrics, insights, and what’s actually happening on the ground—the dashboard of dailylife Perhaps, forecasts and dashboards can be run in parallel?

•How can we spread decision making to make it more meaningful for all employees?

•How does our structure mirror our values? Are there bottlenecks in the structure that need to bedismantled? How does our structure facilitate high performance?

•Where are the silos permeating? Do we have “in-groups” and “out-groups” and do thesedominate our structural relationships?

•Are our structures supportive of testing ideas and experimenting, in real time? How are we atanticipating and pivoting in a rapidly changing environment?

Some call COVID-19 a black swan event implying that it was a bolt out of the blue It wasn’t Ithad been predicted for many years, and those organizations that have been able to respond bestrested on two premises, great leadership and agile structures

Amazon was able to switch by shifting focus of distribution centers to essential items and hiringover 175,000 workers since March 2020 They experimented to increase order capacity forgroceries by 60 percent and developed their own COVID-19 testing lab These actions were not

by chance Amazon had the digital and distribution expertise prepared to cope with this scenario

It goes without saying that CEOs are not able to direct every action of their team members butwith the chorus of their employees and stakeholders they must guide through purpose and extoland live the values and behaviors that they signed up to Lead the way so that the vision isexecuted

CEOs must also put in place flexible structures that allow the organization to respondappropriately to environmental changes or disruptions They must bear the responsibility ofremoving critical roadblocks Structures are based on contributions and not status; structures arebased on collaboration, speed, and flexibility with their stakeholders; and cultures are open toworking with communities and governments Reality is the great referee, not the CEO

CHAPTER 2

The Leadership

Action, Behavior, and Mindset

What Is the Reality?

Leadership is not an ideology … it is a reality! And the reality is that leadership has beenseverely disrupted I would go out on a limb to say that our leaders are failing us The question iswhy might this be?

My experience points to, leaders are not being developed in the fundamentals of good leadershippractice, that is, ethical values, empathic communication, positive conflict, and personalcommitment Today, a leader’s actions and their behavior rarely equate Their said intentions andtheir actual choices are often misaligned Basically, they don’t do what they say they will do.Rather, they excel at being excellent “window dressers,” and this capacity for window dressing

filters through and is witnessed in the disjointed and inconsistent practices experienced acrossfunctional areas, for example, change and governance; diversity, equity, and inclusion; talentmanagement; and technology.

This chapter assesses what might be the probable cause It will point to how the concept ofleadership has evolved over time, and it will ascertain how CEO’s actions, behavior, and mindsetare borne out in today’s reality Questions that I ask range from the simple—Do employees knowtheir CEO’s name and what they stand for? Do employees trust their leaders? To values—Dothey practice humanity? Do they behave with civility? To the complex—What is the makeup of a

“good” leader? What does a high-performing CEO need to do to deliver on the key components

of their role?

Leadership comes in all shapes and sizes, traits, and characteristics; however, as we continue inour unrelenting quest to understand and define leadership, the more caught up we become in thequagmire of what leadership is Ironically, by trying to fit leadership into a model defined by thewestern world, or a specific trait profile, then the more removed we become from what is theessence of leadership

Many of us will be familiar with the different schools of leadership The popular school focused

on the innate traits (e.g., drive, self-determination, and confidence), which graduated totransactional leadership—that is, engaging with followers in a relationship of mutualdependence Theories went on to emphasize the building of cognitive capabilities, such asdifferent types of intelligence (analytical, emotional, social, cultural, etc), while others focused

on developing behavioral skills, such as communication, negotiation, conflict management,influencing, and the like This leads to where we are now—schools of thought that focus onidentity and practice In other words, authentic leadership, servant leadership, inclusiveleadership, transformative leadership, and distributed leadership: each adds richness to definingleadership, but each is limited in that they view leadership through a single lens But can leadersand their roles be viewed through a single lens or should we stop labeling leaders and accept thatlike us, they have multiple attributes and capabilities?

And as stated in my first book, herein lies the paradox of being a leader: “in our currentlandscape, the global leader, who, as well as facing commercial, political, technological, social,ethical, and cultural challenges, also has to be comfortable dealing with ambiguity, complexity,unpredictability and competing views whilst at the same time coalescing key organizationalelements.”

Leaders have to deal with disruptive scenarios on a day-to-day basis These disruptions can rangefrom cyberattacks to social unrest, scandals to pandemics, financial volatility to environmentalissues, and intergenerational and talent management issues to cultural issues

They also face a series of paradoxes such as globalization versus localization, cost cutting andresource streamlining versus investment, short-term versus long-term solutions, and transparencyversus opaqueness

According to The Up Group “Leaders need to combine a set of almost conflicting attributes:visionary and strategic yet execution oriented, data driven and analytical yet creative andinnovative, entrepreneurial yet able to rapidly operate at scale on a global stage.”

Leaders now have to orchestrate and influence on multiple levels, and as Javidan et al point out,

“ … It is the diversity of the targets of influence that signifies and distinguishes the task of globalleaders.”

In addition, a wealth of new ideas continues to permeate, for example, the concepts of “sharedvalue,” “stakeholder capitalism,” “stakeholder health,” “stakeholder activism,” and “transientcompetition.” Paul Bulcke, Chairman and CEO of Nestlé, is blunt:

It’s a tough job with a lot of pressure so you have to be able to see things in context, to havedetached involvement

Given these realities, the CEO’s role can take on a number of facets For instance, Shekshnia,Kravchencko, and Williams posited that “the role could embrace one or all of the followingattributes: as a commercial executor, a financial value driver, a corporate ambassador, acorporate entrepreneur or a global missionary.” Therefore and without question, at the end of theday, leadership is about laying your soul at the altar of sacrifice

Within this context, a number of pressing questions arise: How can CEOs and their peersrespond to these global challenges, paradoxes, and emerging ideologies? How can they managetheir performance in relation to the new capabilities that globalization demands? How can theylead through conundrums yet lead with transparency and integrity? What role does ego play inthe leader’s mindset and behaviors? Where does the balance of power lie? And, let us bear inmind that due to the gravitas of their position, they are very often not privy to the truth They aretold what people believe they want to hear

Which leads me to look at the CEOs direct reports often known as the C-suite—their inner circle.The henchmen and women handpicked by CEOs to be their apostles and officers of the court?Can the CEO be blindsided by them? How do C-suite dynamics play out? Does the C-suite havethe necessary breadth of skills and experience to reflect the consumers and societies we seek tounderstand? Add into the equation, the managers stuck below this C-suite icing often known asthe “Marzipan Manager” or “The perma frost.” How do their duties, responsibilities, andaccountabilities acquiesce with the CEO and his C-suite?

My first lesson in leadership presented itself in my early 20s As part of my MSc thesis oncultural change, I was fortunate to interview leaders from the Executive Leadership Team (ELT)

of a multinational I was surprised when a few of the members of the ELT asked of me thefollowing: “how should they answer a particular question that I had put to him—what was the

‘right’ answer?” Or, “how have my peers answered this question?” My first thought was “really

… you are leading a billion pound company and you are asking a 23-year-old how to answer aquestion?” And that is when I had my first “light bulb” moment on leadership—that the higher

up the organization you go so does the levels of vulnerability, responsibility, insecurity, and

frailty increase These leaders insecurities fed right into Colin Powell’s assertion: “The furtheryou go up the tree, the more your backside is going to be exposed, and you’d better be careful.”When at the top, whom can a leader turn to for guidance? Who do they trust? How are theydeveloped? And how can they stop their egos getting in the way of good decision making? And,

if they make a poor decision, how can they admit it and rectify their mistake in the glare of aspotlight?

As I scrutinize the CEO’s role, I ask what actions, behaviors, and mindsets are fit for the 21stcentury leader and, importantly, how do they seek alignment between what is said and what isdone? As John Buchan reinforces, “the task of leadership is not to put greatness into humanity,but to elicit it, for the greatness is already there.”

Action

The chief executive officer is the most powerful and sought after title in business and the role,the most influential in the organization The role consists of a myriad of components, and theCEOs that I met with flagged 26 differing ones However, they all agreed on five key roles thatare pivotal: providing strategic direction and delivering healthy financial outcomes; building andinvesting in the leadership team; being on top of external stakeholder relations (the visible face

of the organization with the Board, customers, media, political relationships, Governmentagencies, industry contacts, investor relations, regulators, donors, etc); shaping, cultivating, andsafe-guarding the culture; and a persistent focus on communications

They also acknowledged that with power and influence comes responsibility and accountabilityand due to the visible nature of the role, coupled with the ever present aspect of social media,issues relating to governance, employee relations, societal issues, and shareholder value creates

an environment where the CEO is relentlessly scrutinized Given this cocktail of stewardship andscrutiny, the CEO’s actions are crucial

It is important to begin by defining action which is something done so as to accomplish apurpose For me “leadership in action” is the alignment between what is said and what is done—leading with purpose

If your actions as a leader are intentional and transparent, then your employees and stakeholdersalike will see parity between what you say and what you do Additionally, a CEO needs to beever cognizant of “emotional contagion”—that what they “do” and “say” is always on displayand every verbal and nonverbal inflections and nuances is dissected and analyzed to theumpteenth degree Actions must match words and not simply be window dressing Do what yousay you will do! Be a living representation of all that you embody

If there is parity between what you say and what you do, then your license to lead with integrityand credibility are at once established How you align, execute, and renew will demonstrate yoursense of purpose and commitment

Far too often I have witnessed a CEO stand up on a podium at their organizations annualconference or at a local town hall and share with the masses their vision, strategy, andexpectations for the organization They then proceed to walk employees through a series ofactions that they say they are committed to Following these grand “bells and whistles” speeches,and just a few months (or even less) afterwards, these actions appear to fall by the wayside.For instance, they might say: “people are our most valuable asset and then a few months later theorganization undergoes a cost-cutting exercise and a slice of the employee population is maderedundant.” Or, “our people are our key assets and we will invest in them only to cut all trainingand development budgets when faced with difficult cost decisions.” And by the way, while weare on this topic, when leaders say “people are the most valuable asset in our company” this istripe and a shift in mindset is needed because people ARE your company.

Let’s not beat around the bush … the CEO role is a hard role—it can be incomprehensiblydifficult We only have to look at the number of CEOs who have gone of the rails and/or fallen

by the wayside to know that being responsible and intentional is a conscious endeavor.According to data from recruitment firm Challenger, Gray, and Christmas, “a total of 1,160CEOs in the US have left their jobs in the first nine months of 2019 That’s up 13 percent fromthe same period in 2018, and the highest turnover at this point in the year since the company firstbegan tracking CEO departures, in 2002.”

In line with these data, we continue to hear and read the stories about global superstar businessleaders who in the blare of a public spotlight have had to leave their CEO role in the last couple

of years: leaders such as Carlos Ghosn, RenaultNissan; Travis Kalanick, Uber; Adam Neumann,WeWork; Larry Page and Sergey Brin, Alphabet; Devin Wenig, EBay; Kevin Burns, Juul’s;Steve Easterbrok, McDonald’s; Mark Parker, Nike; and Harvey Weinstein, Miramax

CEO, the need to be transparent, display clarity and purpose, and encourage collaboration is key.How can you as a leader keep to your commitment? What actions do you need to take? Are youractions intentional and focused? That is, have you taken into account the impact of your actions

as well as considered an array of perspectives and solutions? Are your actions directed at, andmeaningful for, the majority rather than a minority?

What a CEO Can Do

How successful a CEO is at actioning can be determined by reframing potential actions throughquestions You can then begin to clearly see where the gaps are between what you are saying andwhat you are actually doing Questions can be grouped into themes such as strategic, capability,team, and people The questions must demand responses and be measurable

Strategic:

•As CEO, have you retained sight of the “big picture”? And if so, during times of crises,disruption, or resistance to initiatives, do you have the courage to follow through withimplementing your actions?

•As CEO, how have you actively participated in shaping the culture? How does this manifest inthe organization?

•Have you sufficiently influenced employees to “buy into” important organizational issues?Have you negotiated well on their behalf? Have you grasped the current reality but had thetemerity to focus on long-term goals?

•As CEO, have you established a clear framework for managing relationships with boardmembers and have they displayed the mettle to represent your voice at the table?

•As the standard bearer for corporate reputation, how well do you in your role as CEO representwhat your organization stands for to external stakeholders? What external relationships are youseen to be consciously building and managing?

•How have you visibly navigated sustainability issues such as those pertaining to governance, theenvironment, geopolitical, society, and the broader economy?

•How do you role model the behaviors that align to the organizations values? Do you do whatyou say you will do or is it simply “window dressing?”

•As CEO, are you brave enough to shatter the bureaucratic ways of working and removeroadblocks by putting in place more open and empowered connections and systems? In whatways is this manifested?

•As CEO, can you adapt and flex your behaviors to suit the situation or environment that you arein? Have you shown the agility and capability to work across cultures and geographicboundaries? What about your level of emotional literacy?

Keryn James, CEO of ERM, encapsulates this last point in my recommendations She says:

The environment in which we are operating is different to what it used to be so; future CEOs aregoing to have to be way more flexible at a strategic, operational, and personal level I think this

is the name of the game People who are adaptable, agile and flexible vs people who are rigid

and have a singular style of approach to doing things You have to be able to adapt to everythingthat will come your way because it is very unpredictable.

•Have you, CEO, shown the ability to facilitate change and build in resilience into the fabric oforganizational life?

•As CEO, do you anticipate rather than react? How adaptable are you when a change of direction

is required?

•As CEO, as open as might be to collaboration and gaining consensus at the end of the day, yourresponsibility as leader is to make the decision There is nothing more frustrating for employeesthan an indecisive leader—one who avoids taking a decision A leader who will not commit

either way to an action Mark Thompson, CEO, New York Times, frames it like this:

There is something about sticking to your guns as well I believe in openness and indeedconsensus where possible, but this shouldn’t be mistaken for always—or even often—compromising to get consensus I think the “disagree and commit” approach which says “youmay not like it but we’ll give it a go anyway and, if it doesn’t work, we’ll try something else is amuch better idea than giving any individual or group an effective veto.”

•As CEO, how have you fostered collaboration across functions, divisions, and betweenindividual contributors? Have you been successful at breaking down functional silos and “in”and “out” groups so as to stop tribalism from weaving its way throughout the organization? Ifnot, why not?

•As CEO, how do you demonstrate that you are a team player as opposed to self-serving? Doyou care enough to develop, mentor, and coach others?

•Do you have the confidence to bring dissenters and challengers into your inner circle and acrossthe organization? Are you comfortable at including people with different experiences andbackgrounds to your own?

Indeed, Xavier Rees believes this last action to be critical if you are a CEO—he says:

Too often people with conviction hold their position belligerently And the real differencebetween great leadership teams is that you’re willing to table different points of view but alsothat you have people who are willing and excited to have their minds changed … One of the

great joys of what I do is to have people, who are much better than me in many ways, lead metoward a very different decision than the one that I would have made alone … Also, creating anenvironment where you can get to a place where you all agree because you are able to makepeople feel safe enough to admit that there is a better way than their way.

People:

•Do you as CEO engage and relate appropriately with employees in relation to empathy,motivation, inspiring, and communication? Do you communicate clearly, consistently, and withintention?

•Do you include and value the opinions of others? Do you listen with passion and intention to theopinions of others?

•Do you encourage distributive leadership throughout the organization?

•As CEO, are you clear on what your personal contribution is to the organization? Are you clearhow your contribution adds value to the organization?

•Are you brave enough to be involved in interventions where you may be confronted with harshtruths? Interventions such as truth and reconciliation workshops, listening workshops, andimmersive activities?

When CEOs ensure that these questions can be answered consistently, then they are committed

to action and the organization’s health is improved To enable these actions to become practice, ahost of organizational sources should be put in place that include policies, written procedures,governance, risk, and compliance approaches However, to emphasize, it goes without sayingthat role modeling these actions is the icing on the cake

There is one final interesting point of action that were common across all my interview with the

15 CEOs that I met with: CEOs said that their biggest regret is taking too long to act in removingpoor-performing direct reports or peers, out of important roles, or out of the organizationaltogether Mark Hoplamazian, CEO, Hyatt Hotels Corporation, said:

If there is a need to move portfolios around or move people around or move people out, then thefaster you do that then the better of the company is I haven’t seen any examples in my 13 years

as CEO where more time was a good idea

If dysfunctional individuals or teams are left in place at the top, this act alone rots and destroysthe organization from the very top to the very bottom If the top team is underperforming and theCEO fails to recalibrate his team or remove them, then trust from employees is undermined asemployees see those above them as being protected despite underachievement in theirperformance This in turn ultimately impacts business performance

Ultimately, CEOs should aim to be both sensible and sensitive As Rosabeth Moss Kanter says,leader “leads by curiosity rather than intimidation and by co-opetition rather than conflict andtrusts in the best part of human nature not the worst.”

Behavior

Traits are distinguishing qualities or characteristics that belong to a person and are typicallylinked to personality By extension, this means that the way a person behaves can be attributed totheir personality traits For example, a person can be positively described as ambitious and self-confident, passionate, creative, and extravert or negatively as self-absorbed, aloof,unapproachable, risk-averse, and attention-seeking

Psychologists have identified a catalog of traits that typically indicate the makeup of a “good” or

“bad” leader and subsequently, what style a leader should aspire to The key is to understandhow these personality traits transfer to behavior and mindset

The first important point to make is that personality cannot be changed, but behavior and mindsetcan However, you cannot change behavior without addressing its motivating factors That is, thethinking process that leads a person to take a certain action Also, to understand motivatingfactors, you need to ascertain underpinning values

Let me begin by exploring behavior Behavior begins with a thought, which creates a feeling—

an emotion We make decisions and take action based on feelings and emotions Inorganizations, behaviors tend to mirror the prevalent culture, and the culture in the main isinformed by the CEO’s and his C-suite team’s behavior This is the key, as one of the mostimportant facts about behavior is that they are observed and felt and the CEO is the architect ofthis

So if your behavior shows you to be collaborative, displaying empathy, communicatingeffectively, practicing humility, being meritocratic, enabling collective leadership, valuingdifference, being inclusive, and so on, these will be observed and mirrored by employees If, onthe other hand, your behavior shows you as being autocratic, narcissistic, intimidating,tyrannical, discriminating, and so on, then these types of behavioral styles will permeate acrossthe organization

Furthermore, unless you are a narcissist (aggrandize yourself and degrade others), your truebehavior will always surface even when you try to suppress it Ultimately, behavioral integrity isdoing the right thing when no one is watching

But I’m getting ahead of myself here To set this up, let me begin with a definition of leadershipthat aligns with my stance: Kruyt, Kumra, and Srinivasan define leadership as “a set of behaviorsthat, in a given context, align an organization, foster execution, and ensure organizationalrenewal They are enabled by relevant skills and mindsets.” So what are the types of behaviorsthat might (or not) show up in organizations?

The spectrum of behaviors is grouped into overt/covert, conscious/ unconscious,rational/irrational, and voluntary/involuntary I am positive that you will instantly be able tothink of scenarios where you have witnessed these types of behaviors being played out.

Behaviors can also be grouped into behavioral categories, and for the scope of this chapter, I willfocus on how three types of behavioral categories are played out in organizations These arecognitive behaviors, strategic behaviors, and social behaviors

Cognitive behaviors that we see center on decision making, problem solving, and a variety ofthinking skills, for example, analytical, critical, creative, and constructive thinking

Strategic behaviors that we see center on ability to see the big picture, to keep the long term inmind while attending to the short term, and to consider both contextual and environmentalfactors

At the social level, behaviors that we see consist of having the capability to be reflective andpractice self-awareness, having the confidence to be yourself and exhibiting a range ofinterpersonal skills, communicating effectively, and engaging, relating, and collaborating acrossmultiple levels

So how might these behaviors show up in an organization? Peter Drucker speaks of “clear signs

of the growing disparity between our rhetoric and our practice.” A leader might talk aboutrespect and loyalty for others, for example, but then lose their temper for little reason so theirwords do not align with the behavior that they speak of; a leader might voice the need forincreased diversity in their organization but diversity is not reflected in their leadership team.They may campaign for employees to practice inclusiveness but then cultivate a clan aroundthem that close ranks, harbors an inner circle, that encourages “in” and “out” groups, and thisbehavior does not mark them out as inclusive If they advocate innovation but then suppressesideas that stem creativity and discourage or worse, close down innovation labs, then it speaks ofhypocrisy If they speak of “stepping up” and “leaning in” only for themselves to palm ofresponsibility and/or blame to others, this creates resentment

The role modeling of behaviors that you as leader of the organization ascribe to and advocate isone of the most important roles of the CEO and, importantly, is bestowed on you For instance,Ammar Shata, CEO of Alkhabeer Capital, said:

People observed that at the beginning, in 2004, when I had just established Alkhabeer, I was,understandably, a stubborn and vicious CEO, having stepped into this role for the first time in

my life, a role that required negotiating the unpredictable patterns of headwinds and tailwinds,setting and meeting expectations and developing the culture of my new organization But afterthe end of the initial turbulent period, where the company is in the start-up phase, there is a need

to slow down You need to scale your approach with the success and stability achieved inoperations Accordingly, when I changed my attitude people thought at first that I was out ofsorts, or off character, as I was being nice to them It took them a while to understand that afterthe initial hype, I was adjusting my attitude to fit and align with where the company was in itslife cycle

Disparity between leadership rhetoric and their practice has unfortunately heightened, and in

2018, PwC research found that, for the first time, more CEOs were ousted due to ethical lapsesthan financial performance or struggles with the board This can happen for a number of reasons:Subordinates tend to say only what they think their boss wants to hear rather than uncomfortabletruths either due to fear of reprisal or lack of an open culture In short, the power and privilege ofyour role leave you insulated Add to the mix, leaders who believe that it is humiliating to ask forhelp when they don’t know or are wrong and therefore inadvertently become dismissive tocritical feedback

As CEO, Zhang Ruimin says:

Firstly, for any CEO they must be conscious that they can be wrong There is a philosophy of

“being self-critical.” Very often CEOs tend to be self-righteous This is further perpetuated asmany people eulogize them They might be thinking that their successful model can be foreverand therefore still live in the past As Plato says, “everyday we have a new sun.” For Haier,everyday we have new users Second point of advice that I can give to CEOs is around thedelegation of power Give your power back to employees in terms of the decision-making power;the hiring and firing power; and compensation power

In short, leaders stop expressing humility and start to believe their own hype They begin toentertain behaviors that point to personality traits that in psychology we refer to the dark triad.This dark triad of behaviors—Machiavellianism, psychopathy, and narcissism—gradually creepinto their leadership style The fact is most leaders are known to harbor some of the dark triadbehaviors Why might this be? As a starting point, it is useful to offer a brief review for each ofthe three traits

The term “‘Machiavellianism” refers to a manipulative and deceitful personality oftencharacterized by a lack of empathy and often displaying lack of moral sentiment They exploitothers and focus exclusively on their own goals and agenda Both Brexit in the UK and the2016/2020 USA Presidential campaigns provided master classes in the art of Machiavellianism.Through these campaigns, we witnessed political leaders posturing for power by magnifyingvoices not typically heard and by using venomous vitriol: Leaders who demonstrated a style thatran the gauntlet from self-aggrandizing, dishonest, and lacking in integrity through to scheming,duplicitous, and backstabbing behavior and who were shrouded in a cloak of invisibility

These political leaders role modeled, in plain sight, self over community This has evidently setthe tone for what now appears to be an overriding feature of current leadership practice—short-sighted individuals who fail to realize that the world and its deepening and burgeoningcomplexity is far more interconnected and interdependent more now than ever

In a similar vein, psychopaths are superficial, deceitful, callous, and grandiose They tend to lackempathy, remorse, and the ability to take any responsibility for their actions Psychopaths tend tolack life goals and act in a very irresponsible and impulsive way in general In an organization,they evaluate their victim’s utility to them and extract what they want from their victim, andwhen they are no longer useful to them, then they discard them

Worse yet, there is evidence by Smith and Lilienfeld that suggests a positive association betweenpsychopathy and verbal ability, which explains why psychopaths are often quite eloquent andpersuasive An even more dangerous aspect to psychopathic individuals is their tendency tocome across as charming and charismatic When verbal ability, charisma, good looks, andintelligence coalesce, a lethal combination emerges and their danger to both the organization andothers is ramped up.

There are positive qualities associated with psychopathy including superior resilience understress That is, they stay calm in the face of pressure, recover from setbacks, and have the ability

to strategically channel aggressive tendencies Also, widely celebrated character traits, such ascourage and risk-taking, often coexist with psychopathic tendencies These positive and negativetraits explain how often psychopaths are able to emerge as leaders Professor Robert D Harefamously said “Not all psychopaths are in prison Some are in the Boardroom.” Unfortunately, if

a leader shows psychopathic traits, then it usually will play out in the form of a toxic culture asthe organizations culture will reflect the leaders’ behavior and subsequent values That is,cultures are created in the leader’s image

The third in the dark triad—narcissism—has two sides: a dark and a bright one In their study,Kostas Papageorgiou and colleagues show that on the bright side, narcissists are happier,tougher, and less stressed However, for the dark side of narcissism, they are characterized bytraits of grandiosity, entitlement, dominance, and superiority Narcissists have tendencies

to engage in self-enhancement and can therefore appear charming or pleasant in the short term

In the long term, however, narcissists have difficulty maintaining successful interpersonalrelationships, lacking trust, and care for others, and sometimes feeling disdain for them

Narcissists are particularly dangerous to the organization as they are not team players and have

no interest in the company’s goals, nor do they care about the rules, processes, or regulations.They take credit for the work of others, are great self-promoters who harbor delusions of talent,and according to the psychologist Tomas Chamorro Premuzic “are significantly more prone tocounterproductive and antisocial work behaviors such as bullying, fraud, white-collar crime, andharassment.” Interestingly, Chamorro Premuzic goes on to say that “no one can compete withnarcissists when it comes to formulating and selling a game-changing pompous vision … yetunderlying this apparent superiority complex is often an unstable self-concept: becausenarcissists’ self-esteem is high but fragile, they often crave validation and recognition fromothers.”

The commonality between these three “dark side” personality traits is that people with thesetraits tent to have malicious qualities, including but not limited to aggressiveness, emotionalcoldness, self-promotion, and deceitfulness

Thankfully, a study by Patrick Wright and colleagues in 2016 found that despite what we might

be led to believe, most CEOs are humble In fact, CEOs are 12 times more likely to beconsidered humble than narcissistic with only a small minority of CEOs (approximately 5percent) categorized as narcissistic However, 5 percent is more than the 1 percent identified forthe general population, and moreover, this study does show that narcissistic CEOs exist As well

as producing toxic cultures, narcissist CEOs can drive several dysfunctional outcomes such as

“low executive leadership team morale, poor dynamics with the board, and a lack of sufficientattention to CEO succession by both the CEO and the board.”

A number of researchers have pointed to dark personality as a key culprit in the ongoingproblems with failed leadership in organizations, and this is borne out in organizations hit byscandal that have suffered highly publicized transgressions These organizations have beencharacterized by having senior executives who abdicated responsibility, failed to see theevidence that something was fundamentally wrong, or overlooked questionable businesspractices that favored members of their old-boy networks They displayed illusions of grandeurand at the heart of their organizations lay cultures that rewarded deception, encouraged short-term performance, and discouraged long-term learning and growth and integrity: for example,Insys, Enron, Wells Fargo, and Volkswagen to name a few

Unfortunately, too many employees have a lived experience of this dark side of leadership Aleader that I worked with was arrogant, always shut down opinions and never listened Combinedwith a high level of micromanagement and distrust, I realized that this leader was leading from aplace of fear

This example is a classic combination of dark trait coupled with incompetence When dark traitsare married with incompetence, the picture becomes gloomier It has been suggested that thebase rate for managerial incompetence in the United States is between 50 and 75 percent As aNation, our inability to distinguish between confidence and competence continues to grantpermission to our leaders to behave in ways that demonstrate a lack of value-based attributes.Suffice to say, that for now, it seems that good leadership is the exception rather than the rule Alack of introspection and accountability for their own behaviors is why is it almost seeminglyimpossible for our leaders (be it political or business) to lead with veracity and clarity

So is there such a thing as good leadership practice? Yes, if leadership is viewed from amultidimensional frame and not as one-dimensional A leader has to be equipped with cognitivecapacity, social intelligence, behavioral complexity, business acumen, strategic insight, andglobal focus Tie this together with the competencies that my research (2014) on globalleadership and diversity (conducted across seven different sectors and 22 countries [LEAD³])identified—six leadership competencies that were essential to leadership practice: business andcross cultural, connecting and building relationships, practicing rigor, stakeholder satisfaction,value-based professional, and positive influence

Together, these competencies and dimensions were not manufactured from a vanilla palette butpresent a mosaic of leadership that can be tessellated globally and on which rests the future ofhow our global leaders’ attributes are shaped and perform When you assess these competenciesand attributes against leaders today, you may find many are failing

Sadly, this all culminates in the fact that leaders are not very popular these days The 2017Edelman Trust Barometer shows that only 37 percent of people think of CEOs as credible Andtrust in all four institutions tracked—business, government, non-governmental organization(NGO), and media—to do what is right, is in decline

In Top Gun the movie, a scene that has always stuck with me is one where Stinger (played by

James Tolkan) says to Maverick (played by Tom Cruise) “What you should have done was landyour plane! You don’t own that plane, the taxpayers do! Son, your ego is writing checks yourbody can’t cash.” I’m often confounded and bewildered how this scene often plays out inorganizations

My final words on behavior are directed at leadership development programs Progress onleadership development has stalled, yet companies continue to spend billions each year ondevelopment programs that are letting them down These programs have failed to accomplish thedesired improvements Why are they failing? They fail because they are not recognizing andaccommodating for the context that the leader operates in Newly trained leaders find difficulty

in integrating their new behaviors or practices because the organizations culture, structure,strategy or the top leadership are not aligned with new ways of working, being or doing thatthese newly developed leaders have been taught Alas, they have also failed to acknowledge thatbehaviors and mindsets can change, adapt, and grow Leadership programs need to bereorientated toward giving leaders the best opportunity to amplify their performance within ournever-ending fluid and dynamic environments

CEOs move away from one-dimensional to multidimensional behavioral approaches Behaviorsand the development of leaders are best forged through a holistic and integrated approach thatdevelops a leader’s capability to work in multifaceted environments

What a CEO Can Do

So what can CEOs do to redress this lack of faith in leadership behavior? For a start CEO:

•Focus on alignment between personal and corporate values: A value is a way of being orbelieving that we hold most important If they practice their values by walking the talk so thatintentions, words, thoughts, and behaviors align with those beliefs, then believability andcredibility will be forthcoming from followers For instance, if your values demonstrate integrity

as opposed to toxicity, trust rather than suspicion, support and not aggravation, honesty ratherthan lies, generosity of spirit rather than frugality of self, care and not disinterest, then yourvalues will underpin your behavior toward others

•Tame your ego: be prepared to explore deep questions of meaning and purpose as well as

express vulnerability and humility so that your humanity is visible to all In his book 21 Letters

on Life and Its Challenges, Charles Handy provides a quote by Confucius: “you are humane if

you can practice five things in the world—respectfulness, magnanimity, truthfulness, acuity

[intelligence], and generosity.” Furthermore, akin to what has been identified in the book Good

to Great, leaders who are not ego-driven, share the credit for their company’s achievement,

downplay their own role in them, but are quick to shoulder blame and responsibility for anyshortcomings create cultures that value humbleness Don’t allow success to breed eitherarrogance or complacency As Chairman of Nestle, Paul Bulcke advises:

Don’t take yourself too seriously You are there to serve the company, the company and people,the company is not there to serve you or flatter your ego Egos are blurring reality There are

quite a few narcissists out there You are there to serve your company and serve your people and

to lead them and to be proud of what you do

•Apply focus: Daniel Goleman says that focus is crucial in capturing and directing the attention

of a collective However, focus is dependent on a high level of self-awareness Self-awarenesscomes to those who are able to examine and be honest about their personality traits For example,are you conscious of, and then able to dampen down, your “dark side” traits? Can youunderstand your own limitations and amplify your strengths?

•Improve and adapt your interpersonal and communication skills: Do not underrate empathy,compassion, and authenticity Be cognizant of your emotional literacy Be interested in thestories and views of others Listen with intent and stop transmitting Communicate simply,consistently, and transparently Stoke your supporters’ sense of agency and willingness toparticipate by injecting energy into the culture as well as recognizing small wins and praisingteams for their efforts CEOs and their leadership teams must commit to fostering a caringatmosphere

•CEO, be on behaviors that you would like to inform your culture: Identify and shape the

“critical few” behaviors which are patterns that are tangible, repeatable, observable, andmeasurable, and will contribute to achieving an organization’s strategic and operationalobjectives

•Be comfortable with not knowing and be comfortable with the uncomfortable It is impossiblefor any person to know everything, so be aware of your blind spots In my consulting practice, Ioften use the Johari Window tool to help leaders better understand their blind spots Askquestions and don’t expect a response that suits your frame of reference Stand out of your

comfort zone Question assumptions Nicholas Taleb in his book Black Swan refers to this

behavior He says “sometimes we’re constrained by what we know, and at these timesrecognizing what you don’t know is far more advantageous.”

•Get out of your CEO bubble Walk the floor; spend a day with a team on the frontline; look outfor new trends; get exposure to a broad variety of stakeholders; host conversations via yourcompany’s intranet or open it up to social media; be approachable and once again, actively listen

•Ensure that your leaders are developed on five levels: At the “cognitive level” in terms of theway in which a leader will think, collect, process, and disseminate information; at the “sociallevel” in terms of how they appropriately apply interpersonal skills within a thoroughunderstanding of one’s social setting; at the “behavioral level” through their ability to interactwith multiple stakeholders and apply behaviors such as courage, listening, empathy, and so onacross cultural boundaries; at the “business level” demonstrating knowledge, competence, andskills; and at the “strategic level” relating to the way in which the leader is able to hold that

“helicopter” vision

•Don’t lead from fear; feeling fear is not the barrier The true underlying obstacle to braveleadership is how we respond to our fear Lead from curiosity and hope Live by the dictum

given to us by Maya Angelou that “Hope and fear cannot occupy the same space—invite one tostay.” CEO Xavier Rees agrees with this He says that he is:

Fascinated by the relationship between hope and fear I’ve spent many years of my career inbusinesses where the overwhelming cultural tension is one of fear And the thing that drivespeople is a fear of failure, or disappointing your boss, or getting fired versus the hype of what if

we can be the best agency in the world And the truth of it is, is that you need a degree of bothbut where does the balance lie? I’ve worked in organizations where the balance liespredominately toward fear including in the best agencies And I see this as an experiment where

I hope we lean toward hope I look at “hope.” Hope of “what if?”

When we hold our leaders accountable for their actions and not just for what they say they willdo; when we are able to criticize our leaders without fear of retribution; when leaders commit toserving others as opposed to serving self; when they practice introspection versus exhibition;when leaders put purpose ahead of short-term profits; and when leaders engage actively andlisten to their followers, then and only then can leadership be truly practiced

Good behavior must be the Velcro of our collective consciousness It is time for behavioralchange and to see the evidence of that behavioral change

Leaders need to lead with courage and hold on tightly to reality

Mindset

Our emotional reactions, the decisions that we make, the information that we take, and thesituations that we navigate are all dictated by our mindset In leadership, mindset is extremelyinfluential as it reflects and guide how leaders (and employees) behave in organizations.Mindsets determine the quality of relationships; the interactions that you have and critically, theway that you lead

Stepping into leadership positions will often mean having to learn different skillsets as scenariosthat you have not previously experienced may confront you This often requires an adaptation tobehavior This in turn will mean an adjustment in your underlying mindset The precondition ofbehavioral change is changing our mindsets, and in order to do this, we must dig into our “belowthe surface” thoughts, feelings, assumptions, and beliefs

At an individual level, a key part of understanding what lies beneath the surface of our mindset is

to begin to examine aspects of your “self,” such as belief, control, discipline, esteem, self-awareness, “self-resilience, self-expectancy, and self-direction.” Of course, thislevel of self-reflection means that you are prepared to accept that you have the ability to shiftyour mindset and consequently, your behavior We all recognize that a mindset of flexibility andagility will prove a precious asset in the new world

self-In recent years, the concept of “mindset” has evolved and the “growth and fixed” mindset hasbecome synonymous in the lexicon associated with leadership Coined by Stanford psychologistCarol Dweck, a growth mindset is the belief that you have the capability to develop and change

your talents, abilities, and intelligence through practice, hard work, and dedication It is a criticalsource of strength and resilience as you are more likely to persist in the face of challenge andbetter able to maintain a sense of equanimity in the face of mistakes and setbacks Furthermore,

as a leader, you are more inclined to see value in developing others CEO Mark Hoplamzian,Hyatt Hotels Corporation, is acutely aware of the “growth mindset.” He shares:

I can’t think of one company that is not experiencing some level of disruption or evolution ofwhat capabilities are needed for them to be successful for the future There is an evolving needfor people with a growth mindset because there is so much disruption and the pace of change isaccelerating so much that you simply cannot be in a fixed mode for very long and be successful.Responsiveness, adaptability, and agility are essential

He added that as a leader, there is a need to

Get out of your comfort zone The reality is that you are going to be faced with many moredynamic circumstances A growth mindset and agility must be practiced and enhanced withdeliberate action as opposed to believing you’re either born with a growth/open mindset or not Ibelieve it’s a nurture thing Think of alternative solutions

Conversely, those with a fixed mindset do not believe they can change They believe that theirbasic qualities, like intelligence or talent, are fixed traits The implication for the organization isthat employees who have a fixed mindset will seek situations that validate them and make themlook good Having made a mistake, rather than being persistent and trying to learn from theerror, they will withdraw to their comfort zone They are not willing to confront reality Leaderswho are slow, bureaucratic, indecisive, and stuck in old thinking are the ones who often fail toembrace uncertainty and therefore are not agile or prepared to pivot their thoughts and behaviorsrapidly when they need to They do not have an open or flexible mindset Because leaders with afixed mindset believe that future great managers are born they also put less effort into developingpeople The additional danger is that fixed mindset leaders tend to surround themselves withpeople who make them feel clever and who do not challenge them

Other types of mindsets identified include learning, performance, deliberative, implemental,promotion, prevention, paradox, outsider, and global

A leader with a learning mindset is mentally primed to develop their own learning strategiestoward increasing their competence and mastering something new They actively seek outfeedback, are adaptable and persistent, and demonstrate high performance

Vas Narasimhan, CEO of Novartis, eloquently describes a learning mindset:

The ability to have knowledge laterally In this role, the ability to marry medicine and scienceand finance with data and digital and tech and whatever else is coming around, e.g., virtualreality Your ability to move across these fields is really important So having that intellectualagility and learning agility is important for future CEOs You have to build that as you grow andget really curious about a lot of different things And don’t think that being an expert at one thingwill make you successful

Those with a performance mindset are primarily motivated toward gaining favorable judgments(or avoiding negative judgments) about one’s competence.

Leaders with a deliberative mindset are receptive and curious to all kinds of information as a way

to ensure optimal performance Leaders with deliberative mindsets tend to make better decisionsbecause they are more impartial and less biased in their processing and decision making.However, leaders with an implemental mindset are more focused on implementing decisions,which closes them off to new and different ideas and information

A leader with a promotion mindset is focused on winning and gains They identify a purpose andgoal, have direction and intention, and prioritize making progress toward it Those with apromotion mindset are more prone to positive thinking, more open to change, more likely

to persist in the face of challenges and setbacks, and demonstrate higher levels innovativebehaviors, whereas leaders with a prevention mindset, however, are focused on avoiding lossesand preventing problems at all costs

One of the key abilities of the 21st century leader is the ability to deal with paradox The paradoxmindset displays the agility to hold competing views at the same time and accepting tensionbetween opposites They demonstrate integrative thinking (holding two ideas at once) andtherefore are flexible under pressure and creative in their solutions This creativity will often leadthem toward adopting a multilevel approach so as to embrace and deal in a multifaceted workingenvironment For example, in an environment experiencing financial volatility, they will hold atone end of the continuum, negating employees’ fears with regard to job security At the other end

of the continuum, balancing cost with value and efficiency

Ella Miron-Spektor, an Associate Professor of Organizational Behaviour at INSEAD, says

“adopting a paradox lens shifts the focus from competitive to complementary thinking, thusallowing people to confront tension, scrutinize inherent contradictions, and find creative ways inwhich competing demands can be met A paradox mindset is not about harmonizing conflict orfinding a middle ground It is also not about doing more, as this can lead to burnout It is aboutbeing more mindful about how we use resources By juxtaposing opposing alternatives andlearning to inhabit the discomfort that often arises from tensions, leaders with such a mindsetfoster optimism and resilience.”

Matthew Syed speaks of the “outsider mindset” as a powerful asset In his book Rebel Ideas, he

describes this mindset as those “who can transcend the categories we impose on the world; whohave the mental flexibility to bridge between domains; who see the walls that we constructbetween disciplines and thought silos and regard them not as immutable but movable, evenbreakable We need to be able to understand the status quo, but also to question it.”

Finally, I address the global mindset In our world today, leaders must incubate a holistic andintegrated approach when leading in multifaceted environments on five levels: commercial,rigor, connecting, value-based, and cross-cultural To support these five levels further and enableleaders to navigate the global landscape, it is necessary that they acquire a global mindset Tohighlight what a global mindset comprises of, I will ask you to consider this question: How many

times have you been witness to an organization that decides to expand its business from anational platform to a global platform and what does this entail?

In my experience, the tendency is for CEOs to simply transfer their strategy, management teams,and operational practices and policies into their targeted new markets and hope for the best! Thecrime that they commit in doing so is that it has overwhelming negative ramifications in the hostcountries that they are trying to penetrate and build their business in four ways First, in onesingle swoop, by transferring a senior management team from headquarters into local markets,they have dismissed the local talent that exists and disenfranchised the employees Second, thisnewly introduced management team consisting mainly of expatriates will often not integrate withthe local communities of the host country and therefore disengage with the community base byfailing to build relationships This results in them having a limited understanding of their socialsetting Third, they would have undoubtedly fractured their potential customer base as theirappreciation of the nuances of the customers’ needs, wants, and experiences in the localenvironment will be marginal Fourth, because of the above three, they will experienceconflicting priorities and competing demands with regard to identifying, appreciating, andrespecting differences across cultures and within cultures, as well as political and ethicalchallenges All of these factors will inevitably impact on how the leaders manage context.Harnessing a global mindset will make you acutely aware of potential issues such as the onesthat I have described above

As a CEO, don’t trample on or steamroll employees with differing mindsets Rather, begin tobetter understand yourself Acknowledge:

“Yesterday I was clever, so I wanted to change the world Today, I am wise, so I am changingmyself.”

What a CEO Can Do

•Although at times it may feel and be uncomfortable, it is imperative to uncover and understandyour mindset so as to better inculcate and role model productive behaviors One way in which todiagnose and transform mindsets is to identify behaviors that critically align with yourorganization’s purpose, vision, strategy, and structure Once these behaviors have beenidentified, ascertain what would motivate a person (and you) to live these behaviors and how youwould think and feel when displaying those behaviors What would others see? Follow through

by reframing mindsets through relentless communication of, and practicing these behaviors

•For instance, if a strategic objective for the organization is customer focus, then the mindset youwould appropriate would be attendance to analytics, service, execution, and outcomes If theorganizations’ intent is to pursue societal and stakeholder value, then the mindset harvestedwould invest in the longterm ahead of profit, attend too and care for communities, and be explicitabout equality and the well-being and development of employees If there is an urgent need tospeed up digital transformation, then putting in place systems that excite and encourage yourworkforce to become skilled would assist the mindset in adapting If a network structure were to

be adopted, then the mindset would nurture relationships and bring together diverse stakeholdersthat make up your ecosystem And if the vision is to be the most innovative company, then the

mindset would instill listening with intent, curiosity, and creativity and be comfortable withexperimentation and ambiguity.

•Individuals who would like to identify and develop their mindset will need to be truthful abouttheir personal value system A value might be professional excellence and so you might considerwhat you need to do so as to stretch outside your comfort zone and attain your goals; you maywant to pursue altruistic causes so that you can contribute and give back to society so put inplace actions and practices to do so Integrity as a value may be important to you so you wouldalways endeavor to do the right thing regardless of who was watching or not and always “speaktruth to power” even in the face of challenge Your physical and mental health might be vital and

so investing in behaviors and activities that would permit this would be high on your agenda, and

so on

Identifying and fostering a desired mindset is vital for you as CEO individually, and for thecollective health of your organization It provides the glue that binds action and behaviortogether so that “walking the talk” is achieved At times, you may experience cognitivedissonance if your actions and behavior don’t marry up and also if the distance between whereyou currently stand and where you need to go is uncomfortable

As we know, if there isn’t a significant degree of pain and even a tad of fear, then the chances arethat the mindset won’t change Know that, as you grow, you will feel discomfort Strivingtoward understanding and exhibiting mindsets that push you out of your comfort zone andultimately toward a higher level of leadership performance might initially be painful, but oneworth the pain

CHAPTER 3

The Intangibles

Culture and Change | Communication | Engagement | Diversity, Equity, and Inclusion

What Is the Reality?

Leadership is not an ideology … it is a reality! And culture is a most pressing reality The firstreality is that CEOs are the architects of their organization’s culture—the first intangible It isthey who decide what is important for their organizations in terms of beliefs, values, actions, andbehaviors Additionally, what a CEO pays attention to, measures and controls, and how theyreact to organizational crises through their directing, positioning, facilitation, role modeling,teaching, and coaching all contribute to the organization’s way of being

Satya Nadella, Microsoft’s CEO, comments that “There is something only a CEO uniquely can

do, which is set that tone, which can then capture the soul of the collective.”

The second reality is that organizational cultures are being shaken to their core We are in themidst of unfathomable disruption Disruption that is moving at a breakneck pace

No sooner is one disruption addressed, another surfaces Metaphorically, organizations areoperating like ducks with their heads just above water while their feet pedal furiously under thewater Curve balls keep being thrown at CEOs Whether these curve balls are driven by externalfactors, such as a pandemic, a fragile economy, a warming climate, shareholder activism, or ageopolitical landscape, or whether they stem from internal factors, such as a weak talent pipeline,moral corruption, employee disengagement, or capability erosion … make no mistake,organizations are being hit at all angles.

The key to addressing and withstanding this tidal wave of “change” lies with the organization’sculture How your culture responds and adapts to change will define the difference betweensinking and swimming At first, you might think this statement to be dramatic, but when we drilldown into the mechanisms of change, then the statement “culture eats strategy for breakfast” willbegin to resonate

I go on to explore three equally important intangibles that underscore culture and change, that is,communication, engagement, and inclusion— often considered the softer elements oforganizational life These intangibles are notoriously difficult to code and measure and because

of this, can often take a back seat in the pursuit and energy invested in creating financial growthand shareholder value I scrutinize what role these intangibles play in relation to theircontribution to organizational life or, whether the ways in which these intangibles often show up

in organizations are, in reality, no more than check box exercises, and if so, to what detriment tothe organization? What I know for sure is that I remain both alarmed and fascinated at once, athow CEOs and their teams appear to be less interested in the social and emotional intangibles oforganizational life

My starting point in addressing these intangibles is that organizations are filled with humans: Notnumbers, not data, and certainly not robots And although I acknowledge the organizations moreformal parts such as structures, processes, systems, and procedures, there is also one fundamentalkey element—the human element The human DNA that weaves throughout the very fabric oforganizational life that make up relationships, ways of working, shared values, corporatememory, and trust— in essence, the personality and the consciousness of the organization.Humanity is what constitutes organizational life

My second key point is that people are complex Understanding and working with differentpersonalities and the variables of their conscience or unconscious minds is not easy and mademore difficult when emotions are intertwined Let’s imagine if you choose to go on a diet or start

an exercise regime This is your choice alone At an individual level, you will begin to recognizeand appreciate the behavioral and mindset changes that you need to make in order to achieve anynoticeable differences in your body weight and physicality Now extend this practice to anorganization the size of 50 +/- undergoing any type of change A CEO will have to influence 50people, who will have had no choice but to agree that their behavior and mindset has to change.The CEO will then have to find ways to motivate employees to achieve the goals of the change.This in itself is a compelling reason why communicating, engaging, and including are all vitalcomponents of culture as well as essential to the all-round health and well-being oforganizational life

Culture … the elusive concept that Margaret Heffernan describes as “the secret sauce oforganizational life: the thing that makes the difference but for which no one has the recipe.”Culture is anchored in unspoken behaviors, mindsets, and social patterns that becomes the tacitsocial order of an organization depicting the “way we do things around here”: our practices,networks, influences, perceptions, decision making, and so forth It is how those inside andoutside of the organization identify the organization and its brand and constitutes the realizedshared values, assumptions, and beliefs that are held

At its heart, culture informs how employees treat and behave with each other and how theyperform and act Ammar Shata, CEO, Alkhabeer Capital, shared with me this Red Indianphilosophy:

Every person walking into a village will have an effect on the culture of that village andeveryone walking out will take part of the culture of the village with him

Culture signals what is encouraged, discouraged, accepted, or rejected within a group It defineswhat counts as normal in the organization That is, its cultural norms and within these norms laysunspoken rules For example, how we dress, the language that is used, the decision-makinghierarchy, work facilities, who is afforded status, whether performance or politics is most prized,how disputes get resolved, whether the real meeting happens only after the formal meeting isover, how people get promoted, and so on These norms are visible through stories, symbols,rituals, routines, control systems, and organizational and power structures Luc Van den hove,CEO of IMEC, noted that:

As a CEO, you set the culture of the organization When I look at my peers in other companies,you recognize the company and associate the culture of the company with the top leadership.Especially, in those extremely successful companies, it is always those very pronounced leaderswho set the culture

In their review of culture, Groysberg and colleagues identified four generally accepted attributes

of culture: “It is shared as it resides in behaviors, values, and assumptions and experiencedthrough unwritten rules; it permeates multiple levels; it is enduring in that it directs the thoughtsand actions of group members overtime; and fourthly, it is implicit as people are hardwired torecognize and respond to it instinctively.” Other theorists identify culture by classifying types oforganizations; for instance, clans, macho, market, adhocracy, hierarchy, process, work hard/playhard, bet-your-company, and so on

Like individuals, organizations have a personality, and when one refers to the organization’sculture, they are very often referring to the collective personality of the organization Why we dothe things we do Why we say the things we say Why we see and hear certain things and notothers More so, the culture can be split into subcultures or to draw on the anthropologicallexicon, “tribes.” These tribes can manifest themselves as silos, and although these silos canascribe to the overall values of the organization, in reality, each silo will have its own way ofbeing, thinking, and doing in terms of what gets done or not, and by whom

Depending on how strong the organization’s culture is, one downside can be that breakawayleaders may undermine and even damage a brand, a leader, a strategy, and the overall health ofthe organization We can all think of an organization where a strong culture and its variousfactions have led to a scandal and its eventual demise.

Think of Boeing, where following a series of plane crashes with fatalities, it is claimed that itintentionally knew and sold 737 MAX planes with dangerous software; Facebook where datapractices have come under scrutiny in several countries; Global firms such as Starbucks, Google,and Amazon have come under fire for avoiding paying tax on their British sales

Scandals associated with sexual misconduct: at Mid Staffordshire NHS Trust (Jimmy Savile);Miramax (Harvey Weinstein); Oxfam (senior personnel in Haiti); Rotherham’s council andpolice (child exploitation scandal)

Scandals tied to race: Grenfell Tower—a council housing complex that suffered the deadlieststructural fire in the United Kingdom attributed to poor management and duty of care forresidents who were largely from ethnic minorities; Windrush—a British political scandalconcerning people of Caribbean heritage who were wrongly detained, denied legal rights,threatened with deportation, and/or wrongly deported from the United Kingdom by the HomeOffice

Scandals linked to disingenuity, power, and terror: News Corporation where journalist engaged

in phone hacking of celebrities, politician, and members of the British royal family, policebribery and exercising improper influence in the pursuit of stories; Volkswagen, the largestautomotive company in 2015 were outed when it emerged that their clean diesel engines werenot so clean Known as the diesel emissions scandal or “dieselgate,” it was fined about $20billion; Wells Fargo, one of America’s biggest banks, has admitted creating 3.5 millionunauthorized (fake) bank accounts Initially, the company was fined $185 million, but followingfurther revelations of more consumer abuses, Wells Fargo was fined an additional $1 billion andshelled out $575 million to settle legal claims

These scandals have similar issues in common—a messy culture A culture characterized by afear of speaking up and losing one’s job; weak leaders who failed to live the values that theirorganizations ascribed to and either turned a blind eye, abdicated responsibility, or remainedblissfully unaware to disingenuous behaviors; and unreachable target goals that drove employeestoward not doing the right thing What is shameful is that these firms had all received earlywarning signals of impending problems but cultures characterized by greed, power, and internalpoliticking trumped and prevailed over a culture of integrity, safety, and customer satisfaction

For instance, at Wells Fargo, a warped corporate culture, a decentralized organizational structure,and poor leadership were found to blame for its deceptive practices Added to this hot sauce wereemployees pressurized to achieve company-imposed goals and who operated in a culture of fearthat tolerated no dissent

There is nothing like a crisis to put a spotlight on and expose an organization’s culture One onlyhas to hear the anecdotes stemming from the corona virus pandemic to know that there has been