People often wonder if leadership is something you’re born with or if it can be learned—improved with knowledge, practice, and feedback. The answer is an unequivocal yes.
We are all differently gifted. Some us may be born to lead; still, the leadership ability we are born with must be developed, coached, and exercised regularly, just as natural abilities or talents in athletics, the arts, and other pursuits can be fully realized through practice. Regardless of what natural leadership traits you bring to the table, your leadership ability can and should be developed.
However, to have a developmental (if not transformative) effect on your people, your teams, your organization, and the world around you, you must scale your leadership. This chapter takes a close look at just how to do that.
Jeff Hilzinger has shown us that leadership can be learned, honed, developed, and scaled. Jeff is the CEO of Marlin Business Services, a commercial finance company that provides commercial equipment financing and working capital loans to small businesses across the United States so they can acquire new equipment and technology while preserving capital. Marlin’s value proposition is centered on providing excellent service and delivering on commitments made to equipment dealers, manufacturers, resellers, distributors, brokers, and their customers.
Jeff is a High-Creative leader, but he wasn’t always that way. More than 10 years ago, when we began our engagement with his organization, Jeff was considered to be a great businessperson but just a good leader. He had strong technical, industry, and financial knowledge. He was an excellent strategist with a thorough understanding of business and organizational processes. And while he was very successful, sometimes that success came at a high cost—to himself and to the people around him.
When Jeff completed his first LCP in 2007 (see Figure 8.1), he was rated as a highly Reactive leader. However, his Leadership Effectiveness score was at the 80th percentile. Jeff scored relatively high on Leadership Effectiveness because his leadership brought tremendous upside—his intelligence, decisiveness, strategic capability, financial acumen, business knowledge, and courageous authenticity (he tells it the way it is). His leadership had a clear downside, however, given the tendency of his Reactive traits to cancel out his strengths. His autocratic, arrogant, critical, and distant way of relating made it difficult for others to fully embrace his leadership.
Figure 8.1 Jeff’s First Leadership Profile (2007)
In 2007, we did not know that the Great Recession was just around the corner, and that his leadership would be tested as never before. Jeff needed to upgrade his leadership, let go, and vulnerably face his development gaps, but he resisted changing his approach. Instead, he would do what he had always done as a leader.
The good news is that Jeff did eventually realize he needed to upgrade his leadership and then scale it to his Executive Leadership Team and throughout the rest of the organization. That is exactly what he did. Today, Jeff Hilzinger is a tremendously successful all-round leader. How did Jeff make this fundamental transformation? He put in place all the conditions needed for scaling leadership, and you will soon see how.
Over the years, we have worked with thousands of leaders in hundreds of organizations—large, small, and in between. How do the best of these leaders change themselves, scale their leadership, and in so doing, transform their organizations? We have learned a lot about how to do this from the leaders with whom we have worked. In our experience, three key steps will get you there:
Jeff got serious when he received a second LCP about two years after the first. It revealed that he’d become even more Reactive—a High-Reactive leader. (See Figure 8.2.) His scores had significantly decreased across the Creative half of the Profile, his Relationship-Task balance was near zero, and his Leadership Effectiveness had dropped to the 30th percentile. Jeff was seriously canceling himself out as a leader.
Figure 8.2 Jeff’s Second Leadership Profile (2009–2010)
The combination of seeing this second picture of his increasing reactivity, learning from a great mentor/leader, and being a part of a committed leadership team encouraged Jeff to face his development gap. He went to work and never looked back.
As mentioned, one key factor in Jeff’s progress was learning from a great mentor/leader. Jeff had the good fortune to report to a remarkable boss, the late Jim McGrane—one of the best leaders with whom we have ever worked. Jim was the CEO of US Express Leasing (USXL) and Jeff was his number two and the company’s CFO/COO. They supported each other to improve their individual and collective leadership effectiveness.
In Mastering Leadership, we tell the story of the time Jim received his second round of LCP feedback and discovered how he had slipped from being a High-Creative leader to one of average effectiveness during the Great Recession. When we met with Jim a week after he’d received the Profile, he had already held 25 meetings with 40 of his key leaders. He showed both Profiles to these leaders and asked a simple question: “What happened to me, and what do I need to do about it?” Jim was a role model of being radically human and starting with oneself.
You can’t make the first step of your journey to great leadership until you admit there’s a gap between your current leadership and the leadership you aspire to attain. Jeff acknowledged that he was in a development gap—that he needed to travel a distance before he could become a great leader. Making this journey would require significant self-awareness, development, skill building, and practice. As Jeff became more self-aware, he put himself in the generative tension that results from telling the truth about who you are and who you choose to become.
How then do you become more self-aware? You have a conversation with yourself. Ask: “How self-aware am I?” “What do I pay attention to?” “What impact do I create across the organization?” Then widen your circle. Ask colleagues you trust in your organization, including team members and others: “What is my impact in every context in which I am required to lead?” Knowing your impact or influence is vital. You can’t lead effectively unless you are self-aware of how you deploy yourself into circumstances and what impact you are having.
The fastest way to become more aware is to get feedback from those around you on an ongoing basis. Many leaders are not clear about their impact. We saw this in the discrepancy between rater scores and self-scores on the LCP. The more Reactive leaders are, the more likely they are to assume they have a more positive impact than they actually do.
If you’re not clear about what your impact is as a leader or have reason to believe what you think you know is wrong, then gather feedback via the Leadership Circle Profile or another 360 instrument. After digesting the feedback from the assessment, have a conversation with your team about the impact you’re having and what they need from you. Listen, respond nondefensively to the feedback you receive, and fully appreciate it.
Next, build a feedback system for yourself so you are regularly able to receive input. You want to always know the effect you’re having and whether it’s consistent with the way you want to show up as a strong leader in your organization. If you don’t know how to do this well, get help from a trusted advisor. To succeed as a leader, you must be willing to build, maintain, and use a robust feedback system. And, of course, you must be open to what you learn and to act upon it.
We helped Jim, Jeff, and their team design to harvest their feedback-rich environment. Now Jeff gets feedback all the time. He asks for it; he demands it. His arrogant and critical manner is still apparent, but he is conscious of this. He mitigates the impact of these behaviors by saying something like, “I know this is going to come across as arrogant and I apologize. I’m really trying to learn how not to have that happen. I don’t mean to be critical here. Please give me feedback about anything you see that I need to improve.”
As you put in place a way of harvesting your feedback-rich environment, the one or two big things you need to change will become clear to you. Jeff did exactly this. He asked those around him, and he asked us. Jeff told us he wanted to become a more effective leader. We told Jeff that the combination of variables in our assessment most predictive of effectiveness are Purposeful Vision and Teamwork. When Jeff heard that, he said, “Okay, that’s pretty clear. That’s what I’m going to do.” He chose to become a leader who leads from a clear sense of purpose and translates that into a strategic vision for the organization. And since vision catalyzes alignment and teamwork, those two go together perfectly.
Jeff focused on the One Big Thing (building teams aligned on vision) that would completely transform his leadership and his organization—to unlock it and take it to the next level. As he did that, he continued to get clearer about how he was getting in his own way and canceling out the very things he was focused on improving. He continued to ask for ongoing feedback. And when he found himself leading in old, less effective ways, he looked inside himself—getting to the core drivers of less-than-effective leadership. He wanted to understand why he needed to keep showing up this way.
By getting really clear on the One Big Thing that would take his leadership to the next level and continuing to notice when he got in his own way, Jeff put himself into a transformative structure—generative tension.
A few years later, Jeff’s Leadership Profile had changed considerably. (See Figure 8.3.) His high Controlling scores had come way down. He had reduced his Arrogance and Critical scores. His Relating scores were on the rise and the rest of the Creative half of his Profile was in full bloom. His Leadership Effectiveness had gone from the 30th to the 70th percentile.
Figure 8.3 Jeff’s Third Leadership Profile (2013)
Tragically, in 2014, Jim McGrane passed away. Jeff was the natural successor and stepped in to lead the organization. He told us at that time, “Well, I guess we’ll find out if we are serious about collective leadership.” And, as it turned out, Jeff was. He committed fully to developing his leadership and that of his team. They continued engaging the people around them. These made a quantum difference in the business’s performance.
Jeff has become an example of someone who proves that leaders are not just born, but they can actually grow and be developed. He’s that guy. Jeff has taken his natural ability and built on it, mitigated his liabilities, and adopted new leadership practices that make him a highly effective leader. Jeff is part of Jim’s legacy, leading in a way that’s unique to him and, in that way, Jim lives on. With all Jeff has learned from other leaders, he has truly carved out his own leadership brand and is now passing on that legacy. This is the spiritual beauty of great leadership.
Scaling leadership can be a tremendous challenge for any leader, executive team, or organization—so much so that it often cannot be done from within your current expertise. You may know, individually and collectively, all that’s required to run many aspects of your business, but you may not know all you need to know about how to improve your own leadership and scale that throughout the organization. When you find yourself in this situation—you keep running into obstacles and taking two steps back for every step forward—it may be time to reach out to an outside consulting firm for help. Instead of trying to run portions of the business for which you do not have subject matter or content expertise, either find it within the organization, hire the expertise you need, and/or bring in outside consulting help.
Bill received the email below from Paul, the chairman of a $100 million family business. (The chairman’s name has been changed to protect his identity.) In his thirties, Paul is a strong young businessman tapped to step in and run the company for his father.
Bill,
I hope you’re well.
I run a family-owned business that’s approaching 100MM in revenue this year. Our leadership effectiveness is deplorable, and we are succeeding in spite of ourselves. I’d like to get certified in the Leadership Circle Profile and cascade the assessments and development processes throughout our company. We have to upgrade our leadership if we are going to grow this company and thrive.
Also, as we continue to have advisory relationships with companies both big and small, I see a unique opportunity to apply these tools in the small-to-mid business arena.
I am ready to take on the responsibility of developing our leaders as well as bringing in leaders that are effective and can do the job. I need to be more effective and need effective leaders in the organization for this business to grow and thrive. Please share your thoughts with me, so we can get started.
Thanks
Paul
Chairman of the Board
Paul is not only smart, he is humble. He knows when he needs help and is big enough to let go (let ego) and admit it. He doesn’t want to squander his father’s hard work and lose a company that benefits his family and the people who work for them. Recognizing the leadership in place won’t get them where they need to go, he reached out for help. The best leaders we know who have transformed and scaled leadership, have done so with expert help.
Jeff, Jim, and Paul all began putting in place the conditions for scale by starting with themselves, modeling the radical humanity it takes to succeed. If you don’t start with yourself, you become an obstacle to the very transformation you’re trying to lead. You cancel yourself out. But when you start with yourself, you take hold of the organization’s development agenda, you lead it personally, and you do it openly, vulnerably, and in deep relationship and trust. As you put in place all the conditions for scale, you put the whole organization in generative tension. This is what transforms.
Your most important job as a leader—Job 1—is to develop other leaders. To that end, stop thinking about your team as a random collection of individuals. Instead, start thinking about your team as a team of leaders.
Knowing you have a team of leaders orients you to your primary job, which is to develop other High-Creative and effective leaders. Jeff Hilzinger realized that his primary responsibility was to develop effective individual and collective leadership throughout the organization, and so should you.
What makes Jeff’s story complete is that he continued to work on himself. But, more than that, he took on the development agenda of scaling individual and collective leadership development across the entire organization. By doing so, he took it to new, unprecedented levels of performance.
Jeff’s success led to his next opportunity, accepting the role of CEO at Marlin Business Services. This was the first time he had the opportunity to punch that ticket.
In 1997, Marlin Business Services was a startup, operating primarily as a micro-ticket lessor since its inception. When the founding CEO left in 2016, the board used that event to look for somebody who could lead a business transformation at Marlin. The platform was sound but underleveraged, and the primary goal was to accelerate growth in profitability and enterprise value.
Jeff took on the organization and leadership development agenda personally before he even landed in the new company. A month before he started his new job, he reached out for help and called us. He said,
I know what I’ve got to do here when I come on board. I’ve got to make sure that we do the work around setting vision and strategy. The Marlin platform has several strategic directions it could pursue, so an important early part of this evolution will be a re-visioning of “Marlin 2.0.” I will use this process to create alignment within the senior team and the board about where we want to go.
Most of the current senior team is relatively new to Marlin, and I like them all. So, I’m hoping, as we re-envision the company, to coalesce the team around a common view of our collective leadership responsibilities. We need to be clear on our values and who we are. I’ve got to build a top team of effective leaders. Not only do they have to be effective leaders individually, we’ve got to be a team. We’ve got to work well together in leading the organization. I’m going to take on the development agenda. I want to come in and start working with these folks from the very beginning.
Jeff owned the development agenda from day one. He started with himself and did so transparently, leading by example. He knew he had more to learn and asked for help, feedback, and input from those around him. His letting go in this way and being radically human encouraged everyone around him to do the same.
There is no faster way to develop other leaders and high-performing leadership teams. When you lead the development agenda, you do so personally. If you are willing to learn out loud, let go, be vulnerable, and do it all in deep relationship, the organizational transformation accelerates.
Scaling leadership starts with your team. Do you have the right team in place? Are you treating your team as a team of leaders? Are your leaders self-aware—do they know how they show up as leaders on your team? Is your team of leaders team-aware? If you answered “no” to any of these questions, you’ve got work to do before you can scale your leadership beyond yourself to the rest of the organization.
In developing your team of leaders into a collectively effective leadership team, you will be doing many of the same things you did for yourself, but all team members will do it together. So, it’s a great idea to have individual conversations with all leaders on your team to help them determine how self-aware they are of their impact. Do they know what’s working for them and what’s not? Is the way they show up individually as leaders enabling the organization to become more effective and get better at what it does, or is it disabling? Are they open to feedback and able to respond in a way that creates an organization with greater capacity and capability, or do they defend themselves and continue to diminish capacity and capability?
In summary, you want to help every leader on your team start with him/herself and get on a development path.
Next, assess the collective effectiveness of your team and then your Extended Leadership Team. How does your team show up collectively to lead the organization? Gather the necessary information and feedback. Get open to it. Build an “on the table” culture. Create a supportive, feedback-rich environment in which you hold each other accountable for improving your leadership.
Develop the business case for transformation and determine what that requires of your team. How will the team need to show up in order to accomplish it? For example, if your leadership team chooses to strategically focus on stronger business results and increasing revenues, the question becomes this: How do you need to lead differently— individually and together—to get those results? If you choose to build an organization that’s more engaged, then how will you go about that engagement process? Who do you need to be so that the culture of engagement actually takes root and results in the outcomes that the leadership team desires?
Once you build the connection between business outcomes and the leadership required to achieve them, put the entire group into a development process. Work that process until it becomes part of who you are and how you lead the organization. The development agenda needs to be highly focused and comprehensive. Develop it together but lead it personally. Say, for example, “Here’s how we will transform our business by shifting from who we are now to who we want to be a year from now. This is going to be a major focus.”
Everything you take on as a leadership team needs to be thought about from two distinct perspectives. One, what are the results you want to achieve and over what period of time? Two, who do you need to be, and how do you need to show up and lead together to create those results? Those two agendas go hand in hand. If, as a team, you can lead more effectively, you will get better results.
To effectively scale leadership within your team, you absolutely have to get the right people in place. Do you ever find yourself accommodating the performance of a member of your team? You might find yourself saying something like, “You know, Frank’s a really good guy, and I want to keep him on the team even though he’s not really pulling his weight.” Well, guess what? Frank may not be the leader you need. If he’s not doing what you require of him, and if you adopt an accommodation or compromise strategy, he could keep the entire team from being as effective as it could be. One or two poor leaders on a team can seriously cancel out the effectiveness of the entire team. Frank either needs to get on an aggressive development agenda or leave.
When we started working with one of our clients, the company had an 11-member senior team that functioned ineffectively together. Two years later, the team has only six people. There is, in fact, only one member left from the original team, but the team itself is much stronger. The CEO and members of the team are working together on their leadership effectiveness. They’re becoming more effective as a team in their collective leadership of the organization.
As you upgrade the leadership talent and leadership effectiveness of your organization, some people will fully embrace the development agenda. They’ll be willing to take themselves on, to develop beyond where they are, and make development an ongoing part of who they are. You will need to change out people who aren’t willing to develop and bring in people who embrace what you’re doing. You cannot afford to have ineffective leaders who are not going to develop. As you consider each of the leaders you have in place, ask: “Does this person have the desire to develop? Does he/she really want it? Is he/she capable of what you are asking?” It is a matter of both the desire as well as the capability. You have to know. And then you must decide.
Once you have your team of leaders in place, you have to build strong alignment around your organization’s purpose, vision, and strategy, which is a condition for scaling leadership.
This is what Jeff did when he stepped in as the new CEO of Marlin. We started working with him right away to access the effectiveness of each individual top leader as well as the top leadership team. We helped him get his entire team on a development agenda. Then, within his first 60 days on the job, he brought his leadership team together to set the organization’s direction. Together, they clarified and aligned around the purpose, vision, values, and strategic agenda of the company.
If a team of leaders has responsibility for a business unit or for the whole business, they have to understand and commit to the organization’s higher purpose. They must ensure that the right mission, vision, and strategy are in place. If any of these things need to be refreshed or completely redone, then tasking them to work together to do that will pull them into alignment. It will create the case for their continued leadership and team development, as well as set the stage for each of them doing the same within their teams. They will also be able to communicate the vision, mission, and strategy to the rest of the organization in a way that others are able to understand them, align around them, and know how they can contribute, individually and collectively.
Once you have started with yourself and have begun to develop your leadership team, you need to put in place the structural pieces for scaling leadership throughout the organization. This is the systems awareness condition for scaling leadership. It includes making development a strategic priority, a permanent part of what you do, and institutionalizing it throughout the organization. You are never truly done with creating a system and culture designed to develop leaders.
You can and should create a developmental organization. You do this by cascading all the above steps through the organization and institutionalizing it. How? By starting with yourself and owning the organization’s development agenda; by developing the team of leaders you have, changing out those leaders who are not effective and can’t make the shift, and promoting or bringing in talented people who you assess capable of being effective leaders; by creating a feedback-rich environment; by measuring and tracking development to provide feedback for everyone’s ongoing development; and by continually upgrading the entire system over time. You will also ask all the leaders on your team to do the same with their teams, who will do the same with their teams, and so on.
What gets measured gets done. If you want to scale your leadership, then you need to measure the results and outcomes of your efforts. This requires creating systems to generate the data you need to assess if you are succeeding. Jeff became aware that he needed to measure the results of his efforts to scale his leadership. He asked his team these questions:
What do we have to do from a measurement standpoint? What do we have to do from an accountability standpoint? What’s going to be important from a process standpoint? How do we need to reorganize for us to do that? How do we continue to tell the truth about our performance—where we are in relationship to where we said we would be? How do we create a feedback-rich environment where we’re all getting feedback?
Jeff got it—100 percent. To scale his leadership, he realized he had to completely transform himself and his organization. He had to work with his people to create systems that would support leadership at scale, including measuring results and outcomes. Anything less would not be enough to move the needle on performance.
Fast forward 12 months. We brought Jeff’s entire team together for the second time in just a little over a year. We spent three days together in Gettysburg on that hallowed battlefield learning leadership lessons that could be directly applied. We worked with the team on their own leadership—individually and collectively. We upped their feedback quotient, improving how they could give each other direct feedback. We put all the learning into leadership development plans, capturing what every member of the team needed to do for the next phase of his or her development.
Fast forward another five months. We followed up with the team by measuring its improvement and identifying what needed to be done to further improve.
Fast forward to today. We are going to the next round—institutionalizing the development agenda. As we do this, we’re bringing in the leadership teams underneath them to build and extend the organization’s leadership. We are cascading this work in Marlin’s Extended Leadership Team (the Business Leadership Team). It is now time to scale leadership beyond the top team and engage the organization. Without scaling leadership and building bench strength in leadership, the business will not continue to thrive. Scaling leadership at scale and for scale.
Jeff is extremely methodical in his approach. He understands what works, and he’s data driven. He took what he knew would give him the biggest bang for his buck in turning around the organization and has created leadership systems to perpetuate it. In his two years as CEO, Jeff has built a team that has literally taken the cap off the company, with the stock price going up 120 percent. They’re knocking it out of the park. Marlin is achieving the highest performance in its entire history and is rapidly growing to become a billion-dollar organization.
When Jeff Hilzinger decided to take the CEO position at Marlin, the first thing he did was coalesce his team by aligning all the elements of organizational identity—purpose, vision, strategy, culture, and values. In parallel, he assessed his leadership team over several months. Within a year and a half after taking the helm, he had upgraded his team by installing talented leaders and removing those who weren’t performing at a high level. He had everyone, including himself, working to develop their individual and collective leadership effectiveness. They have gone from a team of leaders that was performing at five or six on a 10-point scale to operating at seven or eight.
Jeff has extended this approach to the next level of leadership to upgrade the leadership system of the entire business. Team members are in the process of completely redesigning the organization and its processes. They have put metrics in place with key business indicators and accountability systems and redesigned the compensation and performance system. The results are telling.
Jeff is constantly raising the bar on leadership. As he scales his leadership further, he continues to look at his ELT and ask a variety of probing questions:
Are we all aligned? Are we all on the same page? Can we have the tough conversations well? Do we speak with one voice? If you hear from one of us, do you hear from all of us? Are we consistent? When we’re inconsistent, do we actually get clear about it?
In 2017, Jeff received his fourth LCP in 10 years. (See Figure 8.4.) It shows what a remarkable CEO Jeff has become, improving on all fronts. He is now capable of deep relationships to complement his other tremendous strengths. His Reactivity is greatly reduced, and his Leadership Effectiveness is at the 95th percentile.
Figure 8.4 Jeff’s Fourth Leadership Profile (2017)
When we first gave Jeff feedback in 2007, he struggled to understand the value of this feedback and accept it. However, over the past decade, Jeff has transformed himself as a leader in almost every way possible. He has gone from being a bottom-quartile leader in effectiveness to the top-quartile, if not a top-decile leader. Not only that, but Jeff has learned how to scale leadership in his organization, amplifying his own leadership many times over through the people who work with him.
We asked Jeff how he managed to make the shift from the leader he was 10 years ago to the great business leader he is today. He explained:
It was actually fairly simple—I took to the bank what you guys told me and what I had learned from other great leaders like Jim. You told me that, from your research, the two most highly correlated dimensions for a leader’s effectiveness are Purposeful Vision and Teamwork. So that’s what I focused on. I focused on building a high-performing leadership team that is really clear on vision, strategy, and performance. I focused on the collective effectiveness of our Executive Leadership Team. Then, I built a feedback-rich environment and took on the development agenda for our business.
We recently spoke with Laura Anger, the CHRO at Marlin, and she described the tremendously powerful effect that Jeff’s leadership has personally had on her.
When I interviewed for the position, I had the opportunity to interview with two other CEOs in addition to Jeff and choose among them. When I sat down with Jeff, I knew I was going to have one of those quality leadership experiences that would become a hallmark in my career.
That’s not what she would have said about Jeff 10 years ago. In fact, people who knew him then would have suggested she not take the job. But Jeff did hire her—one of the best people in her field. Great leaders attract, retain, and further develop great talent.
So, what is Jeff tasked with doing, going forward?
He has to grow leadership capacity and capability as the leaders go into the other lines of business and grow the company. They need the capacity and capability to lead these new business lines as effectively as they are the core business. Jeff has gone from doing the work on self and the work on team to doing the work on his Extended Leadership Team. Then he’ll do the same work on the organization’s entire leadership system.
By following Jeff Hilzinger’s example and the steps laid out in this chapter, you can scale your own leadership and grow leadership capacity and capability throughout every level of your organization. Make no mistake about it, the transformation will not be easy, and it won’t happen overnight. It’s an ongoing process that will take many years, and it’s never really done. However, if you’re willing to follow this process and take on the development agenda, which we hope you will, leadership will become a competitive advantage and asset—both for you personally and for your organization.
Because none of this happens unless you start with yourself, the rest of this book is focused on the universal path of development for shifting from Reactive to Creative and Integral leadership. Chapter 12 discusses in depth how to navigate this journey together.
Take time to reflect on and answer these questions: