IndustryWeek: In ‘True North,’ Bill George Points to the Leadership Gold Standard
“The hardest thing we have to do in business is to see yourself as others see you.” – Bill George, author, Discover Your True North
From IndustryWeek, posted August 18, 2015
Title: Senior Fellow
Organization: Harvard Business School
Executive Experience: former Chairman and CEO, Medtronic
The IndustryWeek Manufacturing Leader of the Week highlights the manufacturing leaders, executives and stars who are driving growth in today’s industry and helping to shape the future of manufacturing.
Being the leader of a company can be fraught with peril, warns Bill George. If you run a public company, there is more pressure than ever to make every quarter’s results better than the last. Along with those pressures, company leaders can operate in a heady world of fame and financial reward. It is an intoxicating brew that can lead to terrible consequences. That’s why leaders need an internal compass that keeps them on the right path.
In Discover Your True North (John Wiley & Sons, 2015), George, the former CEO of Medtronic and a senior fellow at Harvard Business School, brings fresh insights to how executives can become more effective leaders by resisting the temptations of power and staying true to their values. He advocates leadership that is based on authenticity and creates value for all of a company’s stakeholders.
That process involves practices to discover your “True North” – which George described to IndustryWeek as “your most deeply held beliefs, the values and principles that you lead by.” That requires a lifetime practice of pursuing self-knowledge, he says, but the rewards are leadership that creates trust in employees and develops the cultural foundation for the pursuit of enterprise success.
Stray from those principles and you can find yourself in the same boat as Rajat Gupta, the former managing partner of McKinsey. Gupta grew up in Calcutta and was orphaned as a teenager but he gained admission to a prestigious Indian university and went on to a very successful business career. But in 2012, he was convicted on four counts of insider trading and is currently serving a 2-year prison sentence.
Why would a wealthy and successful man put his career at such risk? George writes it was not a “simple case of greed,” but rather the result of never overcoming poverty in his childhood and the unquenched need for financial security.
“We saw that most of the leadership failures came about from people losing sense of who you are,” George said about his research for True North. “It’s not that they were bad people. It’s that they got pulled off course, either from pressures they couldn’t cope with or seductions – money, fame and power.”
The most important characteristic of leaders, George maintains, is that they be “authentic,” or true to themselves and what they believe in. For years, says George, companies weren’t necessarily looking for authentic leaders. Too often, he says, they were looking for corporate rock stars – the next Jack Welch. As a result, they often went outside their own ranks to find the next financial wizard who could promise quick results.
“I’m a very strong believer that leader should be promoted from within,” George told IndustryWeek. “We went through a decade where almost half of CEOs came from outside their organizations. That showed not only a lack of leadership development but many of these did not work out because they didn’t fit with the culture. They weren’t genuine people.”
George says he is much more hopeful about the current crop of business leaders, who he sees as more collaborative and interested in empowering employees to achieve lasting results.
“Today authenticity is seen as the gold standard for leadership,” he writes in True North. “No longer is leadership about developing charisma, emulating other leaders, looking good externally and acting in one’s self interest, as was so often the case in the late twentieth century.”
Being authentic is more than just a nice social characteristic; George says it is the foundation of business success.
“In business, trust is the coin of the realm,” he writes, as it forms the basis for “customers’ trust in the products they buy, employees’ trust in their leaders, investors’ trust in those who steward their funds, and public trust in capitalism as a fair and equitable means of creating wealth for all.”
Learning from Mistakes
Making mistakes in business is a common denominator, George declares. “We all go through it. Everyone has gone through adversity of one form or another.” But not everyone makes career-destroying mistakes. George says the “difference between those who succeed and those who fail is emotional intelligence and self-awareness.”
Emotional intelligence can be developed, George says, and begins with self-awareness. To become more self-aware, George advocates two routine practices.
- Have an introspective period of at least 20 minutes a day. George says we are bombarded by emails, social media and meetings. “We have to pull back from that, whether we meditate, pray, journal, take a jog,” he says, and use that time to take stock of the day and determine if we are “emphasizing what is important in our lives.”
- Get honest feedback from people you trust and will listen to. While introspection is important, you also need a support team that will give you honest feedback. While people you work with can help make up that support team, George says it is particularly valuable to have a group outside the workplace that you can consult with. He has been part of a men’s group for 40 years that meets on Wednesday mornings. “They can give you honest, sincere advice because they know you at a deeper level,” he said.
George says many leaders are burying childhood traumas or other setbacks rather than dealing with them straightforwardly. He says people have to go beyond seeing themselves as victims and come to grips with these negative events.
“Many people are strongly influenced by their parents in ways they don’t even understand and they are replaying that in the workplace,” George observes. “That is not healthy leadership. You’ve got to process that.”
“We present a new concept called post-traumatic growth,” George explains. “The idea is you take your difficult times and you grow from that. That is where you really learn who you are. It gives you the confidence and resilience to overcome very difficult times.”
Understanding how they overcame adversity can provide leaders with the desire to help others deal with their difficulties and grow as leaders. He compares that to a more selfish attitude of, “Hey, I made it. Why don’t you pull yourself up by your bootstraps?”
Not surprisingly, George is an advocate of 360-degree reviews in business. He said the best feedback he got in business was from his subordinates, not his bosses.
“The hardest thing we have to do in business is to see yourself as others see you,” he says. “The 360 review is one of the best ways to do it.”
Through better awareness of who they are, says George, leaders can move away from “external gratifiers like money and power” and toward leadership that is more about “making a difference and empowering other people.”
“We are all called to serve, in effect servant leaders” says George. “We’re not there to serve ourselves. People who work for us are not there to make us look good, just the opposite. We serve them and they are effective at doing their jobs. It is really critical that we make that journey and realize that leadership is not about us.”
One problem is that most of the metrics used to measure young people, such as SAT scores or college grades, are based on how they do as individuals, notes George. Individual achievement often continues to be the focus for young workers such as engineers or analysts. But as employees move up the ladder to leadership roles, says George, it is important to “flip that switch” and realize that your success comes from serving the people on your team.
“If you do that well, they will do anything for you. That then becomes how you build a successful enterprise,” he says. “People in organizations intuitively know which leaders are committed to the company and bleed the company’s colors, and who are in it for themselves.”
George says millennials are different from baby boomers. Unlike that “me generation,” he says, millennials tend to be very collaborative and less concerned about who gets credit for a successful project. And they exhibit fewer biases than earlier generations about race or sexual orientation.
Millennials also want to “make a difference,” says George. “By the way, they don’t want to wait until they are 40 or 50 to do it. They want to do it right now.”
Where is the US Manufacturing Compass Pointed?
What kind of U.S. manufacturing environment will these leaders operate in? George says the U.S. won’t find success trying to compete with China and low-cost manufacturing nations producing standard products.
“The U.S. needs to compete in complex manufacturing based upon product innovation,” he says. ‘I think that is its sweet spot.”
George says the key to that future is developing a new generation of skilled workers.
“There is a huge risk that our workforce right now is becoming obsolete, because we aren’t emphasizing the importance of a well-trained, skilled workforce,” says George. He adds there is too much focus on “generic college education” and not enough attention to vocational education. In that respect, Germany has done an “outstanding job,” says George.
“How can they sell machine tools all over the world – Korea, China, Japan so effectively when they have very high-cost labor? They do so because of the quality and expertise. I think that is what the U.S. has to emphasize,” he says.
There is no country as innovative as the United States, George declares, but in order for that product innovation to continue, he says the nation must do more to develop its workforce expertise. That means more attention to the people that do the work on the shop floor, he notes, providing the training, tools and financial compensation so that manufacturing attracts the best people and rewards them for their contribution to the company’s success.
George clearly believes that a strong manufacturing sector continues to be vital for the American economy and people.
“Hollowing out our manufacturing base and making us a service economy, as some people were talking about 10 years ago, is very, very foolish,” George concludes.