In 1971, when first-term congressman Paul Sarbanes told a friend that he had decided to join the House Judiciary Committee, his friend was incredulous. It was a boring committee, he told Sarbanes, and he wouldn't see much action there. But just a few years later, Sarbanes stood before Congress and made history as he read the first article of impeachment of President Richard Nixon.
This was only the beginning of Sarbanes' 36 years in Congress—three terms as a congressman and five in the Senate before he retired in 2007. Sarbanes grew up on the eastern shore of Maryland, and he was the first in his family to go to college. “My parents were immigrants from Greece who ran a restaurant,” he told me. “They were determined that their kids were gonna get educated, and that we would go to college. But our horizons for college were all local.” Looking to diversify its admissions pool, Princeton University sent a recruiter to Sarbanes' public high school, and he was encouraged to apply. Sarbanes was accepted, and after Princeton, he went on to earn a Rhodes Scholarship, graduate from Harvard Law School, and work briefly in law before pursuing his greatest passion, politics. In 1966, Sarbanes ran for the Maryland House of Delegates, and from that point on, he never lost a race, going on to defeat two House incumbents, a sitting senator, and two former senators.
I interviewed Sarbanes on Capitol Hill in the office of his son, Representative John Sarbanes, who replaced his father in Congress in 2007. At 77 years old, Sarbanes had a full head of coarse, gray hair. He was the very image of an elder statesman, speaking with a slow, deliberate pace. We talked for an hour and a half, and at the end of the interview, Sarbanes gave me a ride back to my hotel, driving me himself.
Despite his long tenure in the Senate, Sarbanes was little known on the national stage for most of his career. An article in the Washington Post described his style as “almost averse to cameras and attention.… He is a straight arrow who largely disappears for the six years between each election, letting scrappier politicians hash things out in Annapolis, Baltimore, and elsewhere while he studiously tends to his senatorial duties.”1 Sarbanes cannot understand politicians who are unable to restrain their impulses, getting caught up in scandals. “It reflects a basic character weakness, and then they expect to be excused for it,” he said.
James MacGregor Burns is an emeritus professor at Williams College and a giant in the field of leadership studies. In his seminal work, Leadership, Burns defines power “not as a property or entity or possession but as a relationship in which two or more persons tap motivational bases in one another and bring varying resources to bear in the process.”2 We all exercise power and have power exercised upon us through relationships. According to French thinker Michel Foucault, power is a force that works through people rather than something that operates directly on them.3 Top organizational leaders are in a position to wield this power not only as they relate to individuals, but also to whole groups and organizations. For this reason, they must necessarily be circumspect in how they employ it. Burns would say that those who use their authority to control others or simply for their own gain are not leaders at all, but only power-wielders.
Susan Ivey, of Reynolds American, the second-largest tobacco company in the United States, makes an interesting distinction between true leadership and the power that arises from rank: “I construe power to be using your position, not necessarily your character, to influence culture or outcomes or decisions, whereas leadership is more formative, and it can be more collaborative.” She compares leadership and power to salt and pepper, which, as every informed dinner guest knows, should not be separated but should also not be applied equally. In Ivey's words, “Salt adds flavor … context, and it enriches food … whereas pepper is strong and sharp.” Both leadership and power are necessary, but in the proper balance—plenty of salt, but only a sprinkle of pepper. In other words, positional power accompanies good leadership, but it should be used only when needed.
To Sarbanes, the right seasoning is a mix of knowing the beliefs of his constituency and using his own judgment to navigate the legislative system. “There's an art or a craft to legislating and putting together a legislative passage and mustering support for it,” Sarbanes said. “You have to put together enough votes to carry the day.” While the “whole loaf” of a bill typically does not make its way all the way through Congress, usually, Sarbanes said, “what you're voting for is better than what the alternative is.”
The irony of Sarbanes' career is that while he largely maintained a low-key presence, he is now known globally as the cosponsor of the Sarbanes–Oxley Act of 2002. As the chairman of the Senate Banking, Housing, and Urban Affairs Committee, Sarbanes initiated and pushed through the bipartisan bill that raised the standards for public boards and accounting firms after the accounting scandals of Enron and others. Sarbanes–Oxley went into effect in 2002 and made “Sarbanes” one of the most repeated names in my interviews. Despite domestic and international praise, the legislation has many critics, particularly along partisan lines. It is a complicated legacy. Shortly after enacting Sarbanes–Oxley, Sarbanes announced his retirement, “I had been in the fight for a long time, and it was time for someone else to pick up the fight and bring a fresh viewpoint.”
In the words of one businessman I interviewed, “The highest form of leadership is when you come to know it's not about you. It's about the organization that you're responsible for and even being willing to sacrifice yourself for that organization.” Organization heads who do not see themselves as stewards of their institutions are simply manipulating their power, not leading.
In my research, I found three basic responsibilities that institutional leaders master if they are successful in their leadership: they are productive with their time and energy; they motivate and manage people well; they build an organizational culture with a vision for human flourishing. As one leader put it, “It's about leadership; it's about culture; it's about values. And if you get those things right, and pick the right people, and let them do their thing, and reward and recognize them for their results, it's really not that hard.”
Heads of organizations are not only required to be leaders and managers but, as one university president described her job, “You've got to be a mayor; you've got to be a priest; you've got to be a scholar; you've got to be a clown.” So the mantle of leadership is not only heavy, it comes with about a thousand hats. “The biggest challenge was never feeling I had enough time to do what I knew would be useful,” she explained. “Going to dinner with students would've been great, sitting down with faculty would've been great, meeting with alumni, talking to the architect. Every day, there were 15 things I could do that would've been rewarding … and I could only do 7 of them.” This challenge of managing so many different responsibilities was consistent across the leaders I interviewed. One former governor described his work as a “blizzard of daily information, challenges, information, questions, decisions.” “We all have infinite jobs,” one telecom executive said. “I could work 24 hours every day and never be done.” With so much on their plates, leaders need to have systems in place to make the most of their limited time.
The frequent travel and myriad duties of top leaders make every day different. Many thrive off of the diversity of tasks. One construction executive said:
The beauty of the job was that there was no typical day. It was very eclectic.… One of the things a good CEO does is learn to dial in and really focus on the opportunities of the day. That could be [for instance] going to a factory and talking to the hourly workforce and trying to help them understand what our vision means and how collectively as a team we work and how we all have a role in getting that done across the whole enterprise. That could be in any country of the world or in one of our large traditional plants with strong union focus.
Steve Ellis, the worldwide managing director of Bain & Company, gave me a sample rundown of one of those rare days when he is in the office. The work of leaders varies across the disparate sectors, but I found his description to be representative of most others I interviewed.
His day starts at 5:30 or 6:00 a.m. Indeed, over two-thirds of the leaders I interviewed started their workdays before 8:00—some started as early as 4:30. Many found that morning hours provided uninterrupted time to get work done before their subordinates arrived. One nonprofit executive, for example, gets to work at 6:00 a.m. every day in order to have two hours to work on correspondence before the rest of her office arrives. Ellis starts his day with a call—usually received at home—from one of the various leadership groups around the world that he manages. Other leaders begin their day by reading newspapers (or, for those in government, intelligence briefings). A few start in solitude and spiritual reflection or prayer. Others exercise. Getting into a rhythm that is not interrupted by others helps these leaders build up a stock of energy for their jobs.4 As one of my informants reported, “I've never met a really, really, really great leader that didn't have a lot of energy.”
After two to four calls in the morning, Ellis said, “Then I'll usually have one or two client-related issues that I have to deal with.” This means a half-day meeting on the phone or, if the client is local, a face-to-face in San Francisco or Silicon Valley. As for later in the day, “The afternoon is typically [filled by] connecting with individual members of the leadership team or key partners around the firm.”
After a day packed with meetings, Ellis tries to make it home for dinner with his family. But the day is not over yet. Ellis then works from 8:00 to 10:00 p.m. on email, “just trying to keep ahead of the avalanche.” (For some, this can mean as many as 800 emails a day, which is the highest number reported in this study. However, several hundred emails is typical.) Sometimes dinner with the family or late-night work is impossible, because a leader will have a work-related reception or dinner—some leaders attend these engagements more nights than not, so the pace can be grueling and relentless.
For leaders like Ellis, there is much to do and only so much time to complete it. The most productive leaders, I found, develop time-saving habits, manage meetings wisely, set aside time for the intellectual labor of the job, stay accessible to their direct reports, and build a thriving organizational culture.
Leaders apply myriad strategies to keep details from eating away their time. Jamie Dimon of JPMorgan Chase tries to return every email and phone call the day he receives them so that they don't bog him down later. Another CEO of a Fortune 100 company with nearly 100,000 employees makes a point to respond to every single email—regardless of who it is from. On the other hand, a more common response to the inbox overload was for leaders to delegate their correspondence work so that they can “have time to focus on the big things,” as one college president put it. Assistants are also helpful for scheduling, but one university president retains total control over his calendar as, “only I can tell what I think is or is not important and how to rank it.” Before one leader goes on a trip, his assistant will place the materials he needs in his car in bags color-coded according to content. A banking executive intentionally sets aside 25 percent of his time to do miscellaneous tasks like read mail, make calls, and walk around the office. Otherwise, such tasks could take up much more of his day. Platinum leaders devise strategies to overcome the avalanche of the minutiae.
One trend that came up repeatedly is that platinum leaders write things down. Many leaders make to-do lists at the start of the day. One leader takes down her own handwritten notes throughout the day to help her remember things. An airline executive keeps notecards on him so he can jot notes of things that he wants to accomplish in a given time. By keeping their own notes or lists, leaders are able to make sense of and organize the overwhelming amount of information they are presented with every day.
One of the biggest time-sinks leaders face is meetings. Modern organizational leadership means meetings—lots of them. In fact, Michael Duke of Walmart estimated he spent as much as 80 percent of his time in meetings. Hence, every effective leader I met had addressed this potential problem. Some scheduled processing time between their meetings to make sure they were able to focus exclusively on the content of each one. “I would try generally to separate meetings by at least enough time so that I could get the last horrible news out of my head or the last obligation jotted down someplace so that I could move onto the next,” said one leader. With so much going on, a leader has to be careful that all his time is not dictated by other people. Thus, some meetings should simply be skipped. One college president told me, “I learned that it was not in the college's interest for me to be at every meeting. It was in the college's interest for me to set agendas for meetings and call meetings when I needed them, rather than them call me.”
John Whitehead, former co-chair of Goldman Sachs and former deputy secretary of state, had a highly developed approach to meetings. Whitehead's years at Goldman, the New York Stock Exchange, and the State Department had taught him to avoid becoming bogged down with small talk or endless discussion. Instead, he emphasized control and preplanning:
Before you had a meeting, you better be sure you knew how it was going to turn out. So I didn't like long, public-discussion meetings at all. Because I thought they sometimes resulted in the worst decisions of all.… I like meetings that everybody knows when they come what's going to be discussed.… I believe in short meetings where you announce at the beginning the time that it will end.
This isn't to suggest that Whitehead didn't value meetings at all; he just kept them short and useful. He typically scheduled four 15-minute meetings back-to-back as a way of meeting with four sets of colleagues in the most efficient manner. Aware of the time constraint, constituents policed themselves on side banter or irrelevant talking points. In a similar way, another person I interviewed talked about how holding meetings while everyone remains standing helped curtail unnecessary discussion. These gatherings also provided regular opportunities to generate positive emotional energy among colleagues. They were as much about strengthening workplace relationships as about making major decisions. Dick Kovacevich, former Wells Fargo CEO, confirmed that such face-to-face encounters were minutes well invested when decisions or changes were to be made: “Why waste all this time?…Because the result would be much more accepted” by employees who perceive “a fair process, rather than getting even a better result [when] the people think the process wasn't right.” This wise use of interpersonal time and energy can significantly increase a leader's social capital in the most efficient manner.
With so many meetings and commitments, leaders have little time to accomplish the necessary tasks of thinking through the ins and outs of their decisions and reflecting on the consequences of their actions. Many leaders set aside time in their office to focus on these tasks undisturbed. South Dakota Senator Tom Daschle set aside an hour of “desk time” every day so he had a chance to go through all the major materials that he needed to focus on. Heavy travel schedules actually come in handy for substantial thinking time. One leader told me, “I use my airplane time as a way to catch up on all my reading, email, and any sort of writing I need to do, whether there's a speech I have coming up, or there's a key communication of some kind.” For many leaders, “the sanctuary of those 12-hour flights” is their best chance to get work done.
Some leaders see a need to periodically emerge from the minutiae of their work and reconnect with the broad vision of their institution or think through recent developments in their field. Former Harvard president Derek Bok shared with me that in academia, there is seldom grooming for a presidency. “[New presidents] know something about what academic life is all about. They understand something about students. But they don't understand what has become a large and complicated body of information about the different parts of the university,” Bok said. To run a large university, presidents need diverse knowledge on the many areas and fields they supervise. In order to educate himself, Bok wrote a report on a different school of the university every year, usually before he had to choose a new dean for that school. In taking time to write these reports, Bok reminded himself of the broader mission of Harvard and educated himself on how to achieve it within the context of particular departments. On a similar note, every year of his presidency, Charles Vest of MIT wrote an essay about an issue confronting MIT or higher education in general. He then shared his thoughts with the campus.
For seven years, George Shultz had one of the most important and consuming jobs in government, serving as secretary of state under President Ronald Reagan. In the midst of the whirlwind of incoming information and outgoing decisions, he purposefully paused for undisturbed intellectual labor:
It's easy to get totally dominated by the events—something is always happening. So I would try—at least twice a week during the day when I was still fresh (not at the end of the day)—to take three-quarters of an hour off. I said, “If the president calls or my wife calls, put it through, but no other calls.” And I make a pact with myself not to look at the stuff in my inbox, and I go over and sit in a comfortable chair with a pad and paper, take a deep breath and say, “What am I doing here? What am I trying to achieve? What are the main problems?” So you try to get yourself out of all of the details of day-to-day stuff and try to look a little more broadly from your own perspective.
By routinely taking the time for personal reflection on the major problems he was facing, Shultz was able to stay sharp and focused on the important issues in the midst of chaos. Another executive used his daily 10-mile run for reflection.
Leaders need to know how to wield their authority in a way that motivates their employees. In the words of one businessman, “You can't be effective technically as a leader until you're effective relationally, because we're too interdependent.” A Washington insider told me that people are the real challenges in leadership, that “the soft stuff is the hard stuff.” In order to accomplish anything, a leader needs to get the people of the organization on her side, which is about much more than popularity. Gordon England, who served as deputy secretary of defense and twice as secretary of the Navy during President George W. Bush's much-maligned tenure, at one point reminded the beleaguered Bush:
You know Mr. President, keep in mind that leadership is not about being popular. It's about being respected.… There's a tendency in Washington to take opinion polls on how well the president is liked [to mean] how effective he is as president, but his current popularity is only a small aspect of his leadership.
While popularity is simply the quality of being liked, emotional intelligence is the ability to understand and manage effectively the emotions of yourself and others. This, I determined after studying hundreds of leaders, is the vital component of leadership. “You can always find smarts,” one leader told me. “I want to know who really knows how to work with people and get things done, and you just try to do your best to find those intangible qualities in people … that emotional intelligence.”
Emotional intelligence, popularized by Daniel Goleman in 1995, is “the capacity for recognizing our own feelings and those of others, for motivating ourselves, and for managing emotions well in ourselves and in our relationships.” Goleman's work adapts the work of earlier psychologists and includes five primary competencies: awareness of one's own emotions, regulating one's own emotions, being able to motivate oneself, sensing the feelings of others, and handling emotions in relationships well.5 In his book, Working with Emotional Intelligence, Goleman claims that “IQ takes second position to emotional intelligence in job performance.” In a comparison of competence models for 181 organizations, Goleman concluded that 67 percent of the abilities deemed essential for effective performance were emotional capacities. On the basis of a similar analysis of competencies for U.S.-government jobs and research he commissioned on executive leadership positions, Goleman observed that “the higher the level of the job, the less important technical skills and cognitive abilities were and the more important competence in emotional intelligence became.”
High emotional intelligence means knowing how to relate to coworkers in a way that does not alienate anyone, including the person in charge. “If you put walls between yourself and others,” one businessman told me, “those walls will come back to haunt you. In my position, the last thing I need is people who are only telling me what they want me to hear or only telling me the good things. I need people to believe that I'm approachable.” As another leader observed, the phone rings a lot less when you are the CEO. Executives are at the small end of the funnel; information comes through only a few sources. One aspect of being approachable is being even-keeled. Many leaders told me about prior bosses infamous for their tempers and yelling fits, but most in this generation of leaders endeavor to communicate frustration in gentler ways. A professor shared, “I had learned early on as a faculty member if you ever shoot down a student, no matter how dumb the comment, no matter how aggressive the question, you freeze the whole class, because they fear the day that you do that to them.” The same is true in the office realm.
Of course, knowing how to relate to someone means getting to know him personally to some extent, too. For instance, while United States senators have unique leadership in their own states, they find themselves among equals in the Senate chamber—equals hoping to persuade one another on a daily basis. To be successful at this, one senator shared, he had to know his colleagues well and to employ appropriate tactics to get their consent: “You get to know people really well in ways that you have to know them in order to work through them to get things done.” The senator described sitting next to a colleague during an important vote; even though it was a secret ballot, his presence was a subtle pressure and ensured the victory.
Using relational influence rather than mere positional power like this senator and executive described, allows a leader to get what she needs by using her unique understanding of each of her coworkers and constituents.
There is a tendency for senior leaders to grow distant from the day-to-day running of the organization, and their position often makes it intimidating for others at the firm to approach them. But this is a recipe for confusion and frustration. They must take action to overcome this difficulty, both through formal, scheduled mechanisms with direct reports, and through less formal connections with those farther down the ladder. The rhythm of a productive leader's workday is set by his routine daily, weekly, or monthly meetings with subordinates.
The first key to positive interactions with subordinates is hiring the right people. Former Coast Guard commandant Thad Allen told me that his first rule when hiring direct reports is that, “Number one is that they shouldn't be me.” He described the necessity of what he called “cognitive diversity,” having people on his team from different perspectives and parts of the organization. He applied a Coast Guard metaphor to the situation. “When you're out trying to fix your position,” Allen explained, “you'll take a bearing of one lighthouse, another one, another one. Where the lines cross is where you're at. It's called a fix. The wider those angles are, and the more of them you have, the more fidelity you have in your position.”
This connection to those below and valuing of divergent perspectives are essential for leaders to gain the information they need to make decisions. Condoleezza Rice shared, “At least two, three times a week … I would have a staff meeting where I expected people to give me quick bursts on what they were doing.” Rice would ask them, “What's keeping you up at night?” Like the meetings with colleagues and constituents described earlier, this regularly scheduled accessibility builds trust and confidence, social capital, and, ultimately, productivity.
Chase Untermeyer, who served as head of presidential personnel at the White House and later as U.S. ambassador to Qatar, had an experience early in his career that changed how he managed his direct reports later in life. While Untermeyer was serving a deputy role in the White House, he found he had trouble getting time with the secretary of his department. When he confronted the secretary about this, the man smiled and responded, “If you think you need an appointment to see me, you will always need an appointment to see me.” Untermeyer eventually learned that the best way to see the secretary was to wait around his office at the end of the day:
Inside the secretary's office, he was sort of holding court with some of his intimates.… And then the executive assistant would say… “Do you want to see Untermeyer?” …[I] would be able to come in and give a burst of a question or some nugget of information that was needed and get an answer and go forth.
Untermeyer found this method “appalling” and inefficient. “I decided,” he said, “that … all the principal people who reported to me would always have a regular time on my schedule every week.” This gave Untermeyer the chance to give them his thoughts and gave his reports a chance to share necessary information with him. It was also a way for Untermeyer to tell them, “I really care about what you do.” Untermeyer understood the necessity of being open to the needs of his staff and obviating his boss's cronyism. “I truly believe,” Untermeyer said, “that those executives who … hold them[selves] apart from sources of information, have only themselves to blame if they are caught by surprise or if things occur that were predictable or preventable.”
Another senior government official shared a similar routine; around 6:30 p.m. every evening, her office would be open to any of her deputies who wanted to talk with her. It was an informal time that would allow her direct reports to update her and “feel that we were in this together and moving in the same direction.” Many other leaders described to me the importance of their constituents having easy access to them, and some had even more creative ways to accomplish this. In order to incorporate access into his administration, one university president invited any interested students and faculty to join him on his biweekly four-mile run. Anyone who could handle the distance not only had an opportunity to bring ideas or concerns to the president, but also was able to interact with him in a relaxed setting.
Another university president communicated her respect to colleagues by stepping out of her office: “One of the things I was most praised for was going and visiting people in their offices when I was getting to know them.” This is because subordinates are usually called in at their boss's leisure and on their boss's turf. By visiting her deans in their own offices, she communicated not only humility but also an interest in their working conditions. An energy executive shared how he made regular visits to his 18 refineries during which he would have dinner with the local management, host a barbeque with all the employees, give out company hats, and go on a walk-through of the refinery. He said, “The most important thing is [for it] to be visible to your people that you care about what they're doing.” Every leader has to figure out what works for her. But across the hundreds of interviews I completed, virtually everyone found one way or another to stay in regular contact with direct reports, and surprisingly, it often occurred outside the context of formal meetings in the corner office.
By working collaboratively with the people in her organization, a leader—especially a leader new to the organization—can develop a vision that springs naturally from the current community. Some leaders I talked with developed a shared vision by engaging purposefully in lateral leadership, making sure others play a significant role. As one CEO put it, “You are driving an aircraft carrier here, not a speedboat.” One nonprofit leader described the long-suffering and relentless collaboration crucial to development of a strategic plan:
Fifteen hundred volunteers and staff across this country have their fingerprints on that plan: small meetings, time. And it's a slow way to work; it's a messy way to work. But at the end of the day, if the stakeholders feel they have ownership—and that's how nonprofit charities have to work—[it succeeds].
Leadership can be shared in for-profit settings as well. Steve Odland has been the CEO of Office Depot and AutoZone, but he spent much of his career at Quaker Oats, where he learned much of the leadership he exercises today. Some of it was interpersonal—Odland learned to say positive things in front of a group and to give individuals criticism privately. He also noted that “if people trusted you, you had a lot more room to make mistakes.” Odland carefully garnered trust among his peers, and when a cross-brand promotion came up that required all the division heads to be on the same page, Odland was prepared to work laterally to achieve agreement:
It required almost like, being the ambassador for a foreign country; you get to go with ideas, take ideas, but be open to listening, modifying ideas, and really working. It was brutal work. It was long; it was inefficient as can be. But it ended up with a good product. And you only do that through influence and willingness to concede—diplomacy, essentially.… But the interesting thing is that that skill set and that process is actually the best process for leadership, even if everybody reports to you.
Odland called this process “gaining enrollment.” He wanted not only to sell an idea to his peers, but to have them totally commit themselves to the idea, “enrolling” in it in the same way students enroll in a college course. He acknowledged that this process was time consuming, but it produced much stronger work cohesion than would a simple directive from the top. Odland brought this belief in lateral leadership with him to Office Depot where he led alongside an officer coalition of the top 100 vice presidents.
On the other hand, soliciting input can go too far. A university president warned me of the dangers: “We aim for consultative decision processes, not consensus decision processes, because with consensus decision processes, you'll never get there. You'll never make decisions.… That's, I think, what paralyzes many universities.” Former Senator and U.S. Attorney General John Ashcroft told me:
Consensus is the enemy of leadership. If you're only taking people where they're already going, you might as well be a bus driver.… A leader does more than just drive people to a destination to which they are already headed.… A leader either takes you where you weren't—where you hadn't had the idea of going—or gets you to a previously understood noble destination at a pace which would have otherwise been impossible.
Many other leaders whom I talked with also endorsed a middle ground between consensus and top-down command.
Shane Tedjarati moved to China with his family in the early 1990s. The consulting company he started there was so successful that it was quickly bought by Unisys, a U.S.-based technology firm. Unisys was impressed by Tedjarati, and asked him to head the company's offices in China when he was only 31 years old:
I got my rude awakening when, on a Friday afternoon, somebody came to my office … left 12 contracts—which were about, you know, three- or four-foot-high—and he said, “All the banks that we sold [information] systems to, these would now be your responsibility.” And I realized they'd sold systems and they'd never done anything with it. I went to visit the first one in Changsha, and I was very politely arrested. And the public security took my passport.… They said, “The bank has got the money, but nobody has come to install for 14 months. We've paid all the money—millions of dollars. Nothing has happened, so we would like you to stay here until [we] can call people to come and sort this thing out.” So I went for a one-day trip, and I stayed two weeks.
Because Unisys was an international company, most of the senior managers in China were expatriates like Tedjarati. “They only looked at China as a place—like leeches—where they can make quick bucks, without really understanding what's going on in the country.” With his unique background of living in Iran, Canada, the United Kingdom, and the United States, Tedjarati was used to working with diverse people. “So I decided that ‘I'm going to understand the locals.’” He ate in the cafeteria with the workers, unlike others who brought their own food. His attitude and willingness to learn Mandarin quickly made him friends. Tedjarati's actions not only created easier relations within Unisys, but they changed the perspective of his employees toward the country where they worked. He changed the culture of the place. For leaders like Tedjarati, this culture change is less like laying fresh sod for manicured lawns and more like cultivating the soil for maximum growth. It takes longer than a cosmetic fix, but it's an investment in future prosperity. Sometimes engendering this prosperity means shifting cultural norms in surprising ways.
Paul O'Neill served in the George W. Bush administration and was CEO of Alcoa, one of the world's largest producers of aluminum. When he took over at the struggling Alcoa, everyone expected him to focus on increasing productivity as a way to increase profits. But they didn't expect that his first priority would be worker safety. This countercultural move turned out to be just the thing that Alcoa needed. Its profits skyrocketed in the next year, stunning industry gurus. What was the connection? As O'Neill said at the beginning of his tenure, “Safety will be an indicator that we're making progress in changing our habits across the entire institution.”6 A focus on something as seemingly arbitrary as workplace safety transforms worker habits and nurtures capable attitudes that can lead to increased profits. O'Neill knew that workers who feel valued naturally bring value to an organization. When I interviewed him, years after he left Alcoa, he was still extremely proud of his safety record, mentioning it several times. He told me a story about how prevalent the safety emphasis was:
The Wall Street Journal sent a reporter out to Davenport, Iowa, where Alcoa's got this huge facility that makes wing planks for Boeing airplanes and everybody else with airplanes. And when the reporter got there, it was raining. So he jumped out of his car and started running across the parking lot to the office building, and a voice yelled out to him, “Stop!” And it was such an authoritative voice, he stopped. And this big guy who'd just come off shift in his overalls came over with an umbrella and said, “We really care a lot about safety here, and jumping out of that car and dashing across this concrete could cause you to slip and fall. So let me walk you over with the umbrella so that you don't fall.” This is an hourly worker who had no idea that this guy was a Wall Street Journal reporter, but it said more about people buying the safety idea than I could have ever accomplished with all the speeches in the world. Somebody that far away [from the top] not only understands the idea but has the courage to act on it even with a stranger. That's pretty good!
While every employee plays a part in making a positive company culture, ultimately it is the leader who is responsible for initiating and guiding these efforts. Sometimes to fulfill this responsibility, a leader needs to step back, as was the case with Donald Kennedy. With public expectations piled on top of work responsibilities, the line marking where the job ends and the person begins can become pretty hard to see, often to the detriment of the leader. Kennedy was president of Stanford University for 10 years but stepped down in 1992 after a scandal emerged regarding the university's spending of federal research money. In describing the situation, a Stanford insider said:
The people who were holding those hearings weren't holding them to seek truth. They were doing them to prove that they had a way to embarrass the high and mighty, and Stanford was part of the high and mighty. And I think Don and some of the people around him played into that, and I think they then created an entanglement [and] he became personally associated with what he had defended.… The government ultimately agreed that we had fulfilled the contracts, but that was four years later or five years later when no one remembered any of that. And by letting it go on, by becoming personally identified, the only way then to ever resolve it was to start with a clean slate, and the only way to have a clean slate was to have a new leader.
The university recovered quickly, but some of the backlash was personal to Kennedy and even his wife. He told me, “We got some pretty bad publicity, and of course, that's singularly unattractive to a spouse. There was one cartoon in the San Jose Mercury News showing the two of us reaching into a cookie jar.” Granted, some of the funds in question had been spent improving the president's house, which may have inspired the personal attacks. Kennedy saw these home expenses as justified because of all the university events at the president's residence, but onlookers viewed the action as an indulgence. Kennedy was in the hopeless situation of being not closely enough affiliated with Stanford to justify his personal spending, but too conflated with the institution to avoid taking the fall. So Kennedy stepped down. He saw that the fastest way for Stanford to recover was for him to fall on his sword. His sacrifice allowed Stanford to move forward and reconstruct its institutional pride.
Before they can change the culture, leaders have to gather information on the state of their organization. Two effective ways they do this are through the “shipboard tours” technique and the “special ops” technique. The master of the first method is Clifton Wharton, who has held leadership positions in government, business, and academia, making him no stranger to starting fresh at an unfamiliar organization. In the days before commercial flights, a young Wharton traveled with his family by ship. Fascinated by the operational complexities of the vessel, he would canvass the whole ship. He was allowed extensive access, likely because he was a little boy, and the sailors took a liking to him.
As a man, Wharton turned this early experience into “shipboard tours.” Whenever he started work at a new institution, he would begin by exploring it at every level. “For me to be able to operate effectively,” Wharton explained, “I want to know where everything is, what's going on, what it is.” So once Wharton was elected president of Michigan State University, he interviewed all of the top officials and most of the trustees before starting on the job. Then, as chancellor of the State University of New York, Wharton visited all 64 SUNY campuses in his first 10 months. When he finished, “I had insight of all the agenda items I was going to undertake. I knew what needed to be done, and I knew all the campuses.” Wharton followed the same plan when he became CEO of the pension and financial services behemoth, TIAA-CREF. He walked every floor of its three buildings and met every employee over the course of two days. After his shipboard tour of TIAA-CREF, Wharton said he was able to correctly guess the departments that were giving the company the greatest trouble and make changes that dropped TIAA-CREF's personnel turnover rate from 26 percent to 5 percent.
Shipboard tours are ideally suited for just after a leader takes office, but leaders need to know what is going on at their organizations throughout their entire tenure. Ironically, the higher up one gets, the harder it is to take the true pulse of an organization. So some leaders get more covert with their reconnaissance—they implement “special ops.” And as any SEAL or Green Beret can tell you, to gather the best intel, you have got to blend in first. As president, CEO, and chairman of AT&T, Randall Stephenson knew he was far removed from the day-to-day interactions of his employees and customers. So he secretly requested removal from the executive telecommunications plan and became just another AT&T customer. “I start receiving a bill,” he said. “And if I want to have service changed, or I have a service problem, I call one of our call centers.… Over a period of years, the word started getting around, so it's becoming harder.” But Stephenson still tries to get the normal AT&T customer experience. He described walking into an AT&T store in a cap and sunglasses to buy an auxiliary cord for his iPhone: “So I watch how they're taking care of customers, and then you just engage with the employees, and you can do that in ways that they don't know who they're speaking to.” At one point, Stephenson made a call to the AT&T service center on behalf of his mother and was so impressed with the representative who handled his request that he drove to her office, introduced himself, and interviewed her to learn how she did her job so well.
This interest in the customer's everyday experience even led Stephenson to reverse a policy decision. To cut costs, he initially had decided AT&T employees who install broadband in customers' homes would no longer hand out business cards. But his brother, who is a broadband installer, explained that the card was actually an important part of their business. Without it, customers who have trouble after the installation have to call the automated system for help, and they might be on hold or transferred several times before they reach their installer. When the installers leave a business card, it's much easier for the customers to reach them with any problems. “Most of them never call me,” Stephenson's brother explained to him, “but the ones that have a problem, I can just show right back up and fix any issues that have lingered—it's huge.” So Stephenson reimplemented the business cards.
A few leaders go even deeper into foreign territory, dabbling in a little espionage. This form of institutional reconnaissance was commercialized into a reality TV show in 2010, Undercover Boss. The CBS show disguises CEOs and sends them among the ranks of entry-level employees to see how they fare (and what they can learn) away from the executive suite. For executives, the show—which averages 17.7 million viewers7—is largely a publicity tool. But it also gives participants a fresh look at on-the-ground life within their companies. Two leaders in my study had participated: Joel Manby of Herschend Family Entertainment and Rich McClure of United Van Lines, the largest moving company in the United States. After participating in the show, Manby, a friend of McClure's, advised him to take advantage of the opportunity to gain a unique perspective on his business. So over the course of nine days of filming, McClure went undercover. He worked as a household mover, in a warehouse, and alongside his company's most highly rated packing team. McClure's experience on the frontlines led him to implement a new web-based tool to help meet the needs of the household movers. He provided financial incentives and training to help some of those he worked with move up the ladder, and he arranged for retraining of an employee who did not seem to be taking his work seriously enough. His wife talked with a female trainer from the claims department and found that she thought of the company, particularly the claims department, as an “old boys' club,” where women did not have much of a chance for advancement.
Leaders do not really need TV cameras or false goatees to find creative ways to cross divides in their organizations. But it does require time and initiative. Ed Whitacre was the chairman and CEO of AT&T and General Motors—two companies with high numbers of unionized employees. He led both companies through years of remarkable success, in part due to his ability to connect with union leaders. “I grew up in a union family,” he said. “So I was about as comfortable, if not more so, with the union workers and the so-called blue-collar workers than I was with the management.” Whitacre related to me that on his second day as CEO of General Motors, shortly after the U.S. government's bailout of the automaker, he visited the head of the United Auto Workers. The union president was shocked; no automobile CEO had ever been to his office. By making this connection with the unions a priority, Whitacre turned his natural friendliness into a major asset for General Motors. Platinum leaders leverage their personal backgrounds and individual strengths for their organization's benefit.
Reconnaissance, company-wide inspections, hiring, vision-casting, scheduling, traveling—it certainly is a lot to handle. But platinum leaders thrive on the diversity and high-stakes nature of their work. When a leader acts, she does more than just the work of one woman. Her passion and habits trickle down throughout the organization to have tremendous effect. This is the challenge and the advantage of platinum leadership: Everything you do is magnified. John Ashcroft described to me the unique challenge and potential of organizational leadership:
It may be more difficult to turn a big ship than it is to turn a rowboat, but I think you have to decide where you want to go. And if you're going to go with the flow, neither is hard to turn. If you're going to go against the flow or you're going to change the direction, they're both going to be hard to turn. If you're in the rowboat, you probably can turn it by yourself, and that's a solo activity, and that's not leadership. It may be noble, but it's solo. If you're in a larger craft, you're going to have to have help to do it, so people are going to have to be convinced by the nobility of your objective and the intensity of your activity.