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The top spots at America's corporations are being vacated in droves as leaders are fired or resign under pressure. A former GE corporate strategist says what's needed is the right leader for the right situation at the right time.
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But when things turn sour---, the economy dips, the stock values are slashed and uncertainty becomes the rule,--- there seems to be scarcity, even a total void of leaders. This is where we appear to be today.
The mighty perceived or manufactured leaders and their organizations have fallen. This is not reserved to one type of organization, since several major institutions--- government, business, non-profits and even the once-revered Roman Catholic Church currently appear to be lacking in leadership. And, although the top spot is where the buck stops, the leadership component is necessary in each division or business unit and in each department.
The real problem is that we have been taught to believe that there is one type of leader for all situations, a "leader for all seasons". Yet, studying leaders in many settings, show that there are a variety of leadership types, and that it is critical to have the "right leader for the right situation. Rudolph (Rudy) Guiliani is a perfect example of having the right leader for the right time. George W. Bush may also qualify for this distinction.
Leadership, What Does It Really Mean?
The dictionary defines a leader in two ways: first, as" one who goes ahead in advance" and second, one who acts as a guiding force, commander etc". If a leader is one who goes ahead in advance, then it seems valid to say that there is only one type of leader, individuals who are out in front. However, if a leader is one who guides, directs, commands, it doesn't mean that they are all moving ahead. Some may be retreating, so that they can re-group and attack later, others may be defending their turf and not permitting the enemy to take ground. Still others may recognize the inevitable and surrender, while others are aggressively growing.
In short there is not one type of leader, but several types and this is the theme I want to build on. This fits the theme of John F. Kennedy's best-selling book, "Profiles In Courage, which describes different types of leaders, some of whom may not be considered leaders at all based on the image of aggressive, growth-oriented leaders that comes from the heroes of fiction, television and movies. Little is written about those who are dull, and only defended. What is written about those who retreat or surrender, is normally presented negatively.
The Core Competencies for True Leaders
Clearly, there are different types of leaders Before detailing the types, it's vital of leaders. Before detailing the types, it's vital to emphasize that all leaders, even if they are different types, require certain fundamentals skills and characteristics.
- Credibility. Given the recent events brought to light, its obvious that being truthful and refusing to cover is the first requirement. This seems to have been omitted from the selection requirements for many today's organizations. It's alarming that so few have failed to learn from the Richard Nixon fiasco. Nixon, had many attributes of being a leader, but he lacked credibility.
- Dedication and Passion. Leaders must be believers in what they do and must be willing to commit as much time and personal sacrifice to do what is needed to achieve their objectives. Leaders can't be "contract workers" who are only willing to contract for the job and not fervent believers in the cause. Unfortunately many of today's "CEOs" appear to be interested in increasing their personal wealth, with their commitment extending only as long as it is personally beneficial.
- Willing And Able To Make Strategic Moves. Leaders recognize that they must be selective and not try to be "all things to all people" They are willing and able to take the time to personally assess their business, select those areas where they can be successful and are willing to discard others that don't have the potential for being winners.
- Competitive and Realistic Drive. Contrary to popular belief, leaders are not visionaries and dreamers, but rather, they are realists, able to convert their priorities into do-able action plans that permit them to create the right level of expectation.
- Ability to Get the Right Talent. Leaders must be able to identify, attract, motivate and retain the "right talent" that fits the unique requirements of their business, markets and strategies. They recognize that the best is resumes, because what is required in one type of situation, is different from another. q
- Knows When To Get Out Of The Way. Timing can make a difference, and recognize that they are not indispensable and can't remain forever. There are many cases, where the leader, was right to grow the organization, but very wrong when the organizations slowed or even declines. Unfortunately, leaders are human. If they are winning, have significant power and prestige it is often hard to step aside and let someone else lead. They true leader, like a good parent, trains his or her successors and exits in a timely way. Of course, timing is not a science, but really based on intuition and judgment.
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- THE FOUR TYPES OF LEADERS
RISKTAKER-----CARETAKER--------SURGEON---------UNDERTAKER
Missionary-------Cautious------Not tied to status quo---- --Decisive
Intuitive----------Managerial----Challenging "folklore"--Compassionate
Adaptive----------Analytical-------Portfolio Manager------- ---Unselfish
Dynamic---------Experienced-- Able to divest at profit------Realistic
----------------------------------POSITION ON LIFE CYCLE
Embryonic ----Rapid Growth-------Maturing---------------Declining
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The Right Leader: Four Types.
Three factors influence which type of leader is the best suited in a specific situation. 1) dynamics of change, 2)degree of uncertainty and position in the company (and/or industry) and 3) the life cycle of the business/industry.
In a rapidly changing, uncertain environment, the leader must be willing to take risks, make decisions rapidly, without the security of extensive data and information. This normally happens when the market or industry is in its embryonic and rapid growth stage, or when there are major changes in the customer, competitive or technological environment are occurring.
In more stable, moderately changing situations--- where there is ample data about the past--- the leader must be able and willing to take the time to learn about the past, fully understand the current environment and project into the future. Then, as markets decline, the number of options drop as well, and it may be necessary to prune assets, sell businesses and/ or redefine markets, all of which require still another type of leader.
Ultimately, both markets and businesses will reach a point when a leader must make the tough choices of closing down or integrating resources with others.
In a 1993 book, this author focuses on the concept of different leaders for different situations and times. Four categories are depicted: Risktaker, Caretaker, Surgeon and Undertaker. The names were selected not only because they reflect different leadership types, but also because they were easy to remember. It is important to note, the titles are not the key, but the recognition of the different skills and abilities required by each type.
Risktakers
Risktakers are entrepreneurs and revolutionaries willing to bet their career on their cause. They are able to make decisions with little or no hard data and then give their whole being to make them happen. If successful, they initiate new markets and even industries. If they fail, they are probably considered to be "crazies" These leaders are true missionaries, highly intuitive, adaptive and flexible and dynamic. Examples include Stephen Jobs, first to create the personal computer market( for Apple Computer), Bill Gates and his associates who provided an innovative personal computer operating system (at Microsoft Corporation). In the public sector, Harry Truman was one of the greatest Risktakers, risking almost the entire world with his decision to use the atomic bombs to end World War II.
Evolutionary/Caretakers
The Caretaker is the more traditional business leader who cares for and nurtures an organization during the longest period of its life. However, this type of leader needs to continue to grow but in a more predictable, evolutionary way. These leaders need to be able to manage, install systems, select and grow people, adapt to change and meet expectations in a consistent, predictable manner. This leader must balance the major stakeholders' expectations and avoid major surprises. They tend to be analytical, many have financial backgrounds and are cautious. Evolutionary/ Caretakers tend to be analytical and cautious, and many have financial backgrounds. Reginald Jones, General Electric's chairman and CEO, from 1972-81, was this type of leader. Jones was able to systematically grow the company profitably and provide a financially strong company to Jack Welch when he took over. Duane Ackerman of Bell South Corp., Louis Gerstner of International Business Machines Corp. and Michael Critelli of Pitney Bowes are recent examples of leaders who have focused on evolutionary change, rather than doing major surgery or undertaking high risk ventures.
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CEO DEPARTURES SURGE
# of CEO departures
May '02 --------------80
April' 02--------------54
October' 01---------80
June' 01-------------82
May'01---------------84
Source: Challenger, Gray & Christmas Inc
Surgeon
Surgeons are needed when the business is mature and the portfolio is unbalanced with a mixture of attractive/ unattractive components. This type of leader needs the skills of a medical surgeon--- the ability to remove the malignant organs, without harming healthy ones or killing the patient. He or she requires a good understanding of their business and a clear set of criteria to determine what will stay, be grown and removed. The organizational Surgeon also needs the ability to sell off and exit businesses in a way that will provide cash and capital to reinvest in the more attractive assets. The Surgeon leader is common in today's business world. GE's former CEO, Jack Welch, fits well in this category, because he divested television, audio products, small appliances and dozens of other business entries, at the right time generating huge profits. Welch demonstrated the need for this type of leader to be patient, and move when the opportunity presents itself, while assigning other types of leaders to key components of the company. Gary Wendt, a Risktaker, led GE Capital, while Jeffrey Immelt, an Evolutionary/ Caretaker (grower) led GE's Medical Systems business.
Undertaker
Unfortunately, for some organizations, the surgery fails or the new ventures don't yield the promised results. It then needs another type of leader who can objectively assess the organization's viability. Many executives having concluded that their companies were not viable in the long term, were willing to sacrifice the corporate entity and save its healthy components by merging with stronger players. These are the Undertaker leaders.
In 1985, Thornton Bradshaw decided that RCA would be better off if it merged with a stronger company, and so he engineered the merger of RCA with GE. Today, RCA is only a memory and a brand on some consumer products. Michael Jordan, the CEO of Westinghouse Co., decided to divest the electrical and industrial businesses and concentrate on the broadcasting business. Recognizing the need to merge with a stronger player in this sector, Jordan merged with CBS Inc., taking the CBS name. Within a few years, CBS subsequently merged with Viacom, Inc. While the name Westinghouse is gone, many of its components have continued to survive. Companies like Perkin Elmer Inc., Compaq Computer, Scott Paper have all disappeared because their Undertaker leaders-deciding they were not viable on their own-merged with others, losing their corporate identity, while the healthy pieces live on.
Are They the Right Leaders?
September 11 impacted the world-tragically and otherwise. Months later, the Enron and Anderson scandals grabbed the headlines. Suddenly, all companies are being scrutinized, and most, if not all, major organizations are in a state of change. There is serious question whether their current leaders are appropriate for the future. These changing organizations may need different types of leaders. Some current examples:
Carly Fiorina, CEO of Hewlett-Packard Co., has exhibited all of the attributes of a Risktaker, moving quickly and aggressively to change the HP strategy and culture. Her move to acquire Compaq met with significant resistance, but she won this round and now needs to prove that her type of leadership is the right one for the combined HP/ Compaq.
Samuel Palmisano, CEO of IBM, who replaced the successful Louis Gerstner, is also confronted with the need to change. His first response is to reduce jobs, but this will not be enough. Will IBM need an aggressive Risktaker, a skilled Surgeon, or will it be able to win with the continuation of a Caretaker?
Lawrence Bossidy successfully performed as an Undertaker when he merged Allied-Signal Inc. into Honeywell. GE attempted, but failed to take over Honeywell when the European Commission refused to permit the merger. Today, Bossidy must decide what type of leader should succeed him at Honeywell. Does the company need an aggressive Risktaker, or should it seek another merger partner?
AT&T, Xerox, and Lucent Technologies are each facing a leadership crisis. It is clear, in each of these cases, that the aggressive growth, diversification and selective surgery haven't worked. Now perhaps only an Undertaker-type leader can save those components that are healthy and should be saved.
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HARNESSING LEADERSHIP TRAITS
- Recognize what it takes to be a leader. Use the criteria here to identify the "real" leaders.
- Develop a portfolio of leaders. Put the right leader in the right position.
- Don't double guess or micro-manager the leader. This doesn't mean leaders should not be challenged, especially if they appear to be saying one thing and doing another.
- Acknowledge that leaders are not "messiahs". They are responsible for setting realistic expectations and achieving them.
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Leaders are born, not just trained.
Leaders are born with the inherent abilities of credibility, passion and dedication; they are adept at making tough decisions, motivating people and knowing when to leave. Leadership is a combination of skill, intuition and judgments, not a science that can be laid out and developed.
This doesn't mean that leadership skills cannot be enhanced to make the born leader even more effective. But the training and development leaders receive must fit their unique needs and characteristics. The skills required to a successful Risktaker are very different from those required to a Surgeon, and the training must focus on these differences and not on generic leadership characteristics.
So, while there are voids at the top the real issue is not whether there are leaders today, but whether the right leaders are in the right places. To ensure that this is the case, each organization must continually assess the leadership fit and be prepared to place different types of leaders, as required.
This doesn't mean just at the top of the organization-it must be done for each component or business unit. Boards of Directors must demand that companies have viable, executable leadership portfolio, consisting of all types, to be assigned where and when they are needed. And, they must make certain that those who select have the fundamental core competencies and are give sufficient time to win.
Want to learn more: read
"Risktakers, Caretakers, Surgeons & Undertakers,
the Four Faces of Strategic Leadership".
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