October 7, 2009

Leadership in Focus:

Leading in Difficult

Times

change lives · change organizations · change the world

Charles O’ReillyFrank E. Buck Professor of ManagementHank McKinnell-Pfizer Director of the Center for Leadership Development and Researchoreilly_charles@gsb.stanford.edu

In the past year…

…and more to come?

The Challenge:

What do we mean when we say someone is a “leader”?

What is the leader’s role during times of crisis and change?

• A Google search on “leadership” resulted in 200,000,000 hits.

• There are more than 70,000 books on Amazon with “leadership” in the title.

• There are 3,500 management books published in the U.S. each year.

• The 1991 edition of The Handbook of Leader- ship cited more than 7,500 research studies.

Too much informatio

n?

Too much informatio

n?

What is “leadership” really?

“There are almost as many definitions of leadership as there are people who have tried to define it”

Ralph Stogdill (1974)

“In the past 50 years, there have been as many as 65 different classification systems developed to define the dimensions of leadership”

E.A. Fleischman, et al. (1991)

“Leadership has been the subject of an extraordinary amount of amount of dogmatically stated nonsense.”

“Leadership is a process whereby one person

influences a group of individuals to willingly

achieve a common goal.”

“Leadership is a process whereby one person

influences a group of individuals to willingly

achieve a common goal.”

Your success, and thesuccess of your firm,

depends on your abilityto get others aligned withyour strategy and vision.

Your success, and thesuccess of your firm,

depends on your abilityto get others aligned withyour strategy and vision.

This raises an importantbut non-obvious question:

Why should anyonewant to follow you?

This raises an importantbut non-obvious question:

Why should anyonewant to follow you?

What is “leadership” really?

Chester Barnard (1948)

If your answer tothis question is:

“I’m smart or I’m theboss or I control the

rewards” you might want to think a bit

more about the question

If your answer tothis question is:

“I’m smart or I’m theboss or I control the

rewards” you might want to think a bit

more about the question

• Is there a difference between management and leadership?

Back to Basics:

Management• Planning and budgeting- Detailed steps for achieving results.• Creating the structures to implement these plans• Controlling activities and people.• Problem solving• Ability to make the orga- nization and systems operate effectively

Leadership• Setting basic strategies, vision, and values• Communicating (words and deeds) to align the people with the vision• Motivating and inspiring people to overcome obstacles• Creating change• Helping the organization adapt to new situations

John Kotter (1982)

“Managers are people who do things right and

leaders are people who do the rig

ht thing.”

Bennis & Namus (1985)

“Managers are people who do things right and

leaders are people who do the rig

ht thing.”

Bennis & Namus (1985)

Leadership versus Management

Give your employees the definitions of management and leadership and ask them to place you on the following grid:

Leadership

Management

0

0

+

+

++

++

A Thought Experiment:

Management• Measurable objectives x • Clear structure and process x • Effective monitoring x • Solves problems x • Designs effective systems x

Leadership• Provides a compelling vision x • Effective communication x• Inspires and motivates x• Creates change x • Helps group adapt to change x

StronglyDisagree

StronglyAgreeCEO “A”

A Thought Experiment:

Give your employees the definitions of management and leadership and ask them to place you on the following grid:

Leadership

Management

0

0

+

+

++

++

A Thought Experiment:

CEO “A”

Management• Measurable objectives x• Clear structure and process x• Effective monitoring x • Solves problems x• Designs effective systems x

Leadership• Provides a compelling vision x • Effective communication x • Inspires and motivates x • Creates change x • Helps group adapt to change x

StronglyDisagree

StronglyAgree

CEO “B”

A Thought Experiment:

Give your employees the definitions of management and leadership and ask them to place you on the following grid:

Leadership

Management

0

0

+

+

++

++

A Thought Experiment:

CEO “B”

Give your employees the definitions of management and leadership and ask them to place you on the following grid:

Leadership

Management

0

0

+

+

++

++

A Thought Experiment:

CEO “B”

CEO “A”

Given where you believe yoursubordinates would place you:

What are the implicationsfor the future of yourbusiness—and your

ability to lead it?

Given where you believe yoursubordinates would place you:

What are the implicationsfor the future of yourbusiness—and your

ability to lead it?

“Many writers on leadership take considerable pains to distinguish between leaders and managers. In the process, leaders generally end up looking like a cross between Napoleon and the Pied Piper. This troubles me. ”

John W. GardnerOn Leadership (1990)

Leadership versus Management

• Theory and cases aren’t enough. How can we capture the subtleties and emotional challenges of leadership and use these to provoke the discussion and reflection needed for learning about one’s own values and leadership style?

How can people learn leadership?

• Leadership challenges. Each leader was asked to reflect on “the toughest challenge” they faced as a leader and to describe what the situation was, what they did, and what they learned— basis for discussion, teaching, and learning. 200+ vignettes. Now being used at more than 600 universities.

• Interviews. Learn from accomplished CEOs and leaders. More than 250 interviews, primarily CEOs of entrepreneurial companies or leaders facing significant challenges (e.g., turn- arounds, start-ups, combat in Iraq) and, more recently, young MBAs out 5-10 years—both success and failure.

Think back on your own experience:

• What were the toughest challenges or the hardest decisions you faced as a leader?

• What made these so difficult?

• What did you learn from this experience? What advice would you give others facing a similar situation

How can people “learn” leadership?

Leadership Challenges: What We Heard Taking Charge

• Defining your role• Forming the team• Politics and resistance to change

Getting the Right People in the Right Jobs• Hiring and firing• Dealing with prima donnas and poor performers• Succession

Defining or Changing the Culture

Motivating the Workforce• Aligning compensation and incentives• Managing diversity and inclusion

Managing Growth and Change

Danny ShaderCEO, Good Technology• Turnarounds• Downsizing and pay cuts

Bill CampbellChairman, Intuit• Performance management• Resistance to change

Brian NeSmithCEO, Bluecoat Systems• Dealing with the board• Arrogant engineers

Nabeel GareebCEO, MEMC Electronics• Taking charge• Dealing with Wall Street

Elie AntounCEO, MediaQ• Dealing with founders• Making change stick

Kent ThiryCEO, DaVita • Cultural fit• Confronting conflict

Allison HickeyGeneral, USAF• Transformation• Gender discrimination

Debra ReisenthalCEO, Novasys • Dealing with crisis• Building the culture

Brian NeSmith, CEO of Blue Coat Systems, assumes his position when the firm is in danger of failing. He must deal with a critical but disruptive technical prima donnawho is essential for the turnaround.

Difficult Conversations -- Four Examples

Bill Campbell, Chairman of Intuit and a widely respected leader in Silicon Valley, describes a pivotal investmentdecision Intuit had to make in 2000. One of his key managers is not on board. Campbell describes how heresolved the issue.

Allison Hickey, a general in the Air Force, describes the challenge in trying to transform F-16 fighter squadrons toUnmanned Aerial Vehicle (UAVs) units. The fighter pilotsare not enthused about this change.

Kent Thiry, CEO of DaVita, a $5 billion healthcare firm, describes how he dealt with a new senior hire who wasnot fitting in and disrupting the dynamics of the seniorteam.

Allison Hickey is a general in theUnited States Air Force. Listen asshe describes the challenge shefaced when changing the missionof a fighter squadron

What would you do? Why?

Organizational transformation

KC 135

Hickey was in the first class to havewomen at the U.S. Air Force Academy.She has more than 1,500 hours as a pilot of KC 135 and DC 10 tankers. Shecurrently is the Director of Future PlansDirectorate in the Pentagon and respon-sible for shifting capabilities of theAir Force

From this… …to this

As a pilot, how do you feel?

F - 16UAV

General Hickey’s challenge

Think of yourself and your team as “signal generators”whose words and actions are constantly being scrutinizedand interpreted by others, especially those below you.

• Calendar management - spend time• Ask questions• Follow-up• Public statements• Meetings• Agenda control• Summarization• Ceremonies, symbols, language• Physical settings

Lessons?

“You must be relentless and boring.”

“Being intelligent is an attractive nuisance.”

Jack Welch

Rich Fairbank

“The first rule is get rid of the troublemakers. Get rid of the people who are the disruptors because they’re just not doing their own job, they are keeping other people from doing theirjob. You have to go through and move those people along and then communicate to theother people a clear vision of what the gameplan is.”

Richard ParsonsCEO Time WarnerFeb. 17, 2006

Lessons?

“Too many leaders don’t spend enough time making the case for change.”

Lou GerstnerWho Says Elephants Can’t Dance?Harper Business, 2002,

Lessons?

A FINAL THOUGHT:

By virtue of your positions as CEOs,you are all in the business of not only being leaders but also teaching leadership to those in your organization.

“The man who tries to carry a cat home by the tail learns 10X as much as the man who simply watches.”

Mark Twain

FACULTY HAVE THE EASY JOB…