Want to Lead Your Company to High Performance? Change How You Lead.
Growing up in the 1980s, I viewed Jack Welch as a model of the ideal CEO. Tough minded, wildly successful, and more than a touch human, Welch provided inspiration for millions looking to go from rags to riches. While Jack Welch the man deserves to be revered, his most often cited management mantras require a second look. Here’s why and what your company should do instead.
Be number one or number two in your market, or exit the business.
Fire the employees in the bottom ten percent of performance every year.
The CEO mandate is to maximize shareholder value.
These three management principles were the core of GE’s management system two decades ago. A massive number of books were written on GE management practices; hundreds of thousands of business students studied to emulate Welch and his business actions.
The opportunity to connect around a shared purpose is needed more than ever.
Times have changed. For companies to access resources – environmental and human – they need to provide significant value to the local communities from where these resources come. As a result, companies are no longer able to control their corporate destinies. Now they must work with these local communities and other stakeholders to access the resources they need to prosper in perpetuity.
So what are the leadership traits these companies’ executives – and any entrepreneur interested in growing her company – need to embrace to outperform their competition today, tomorrow, and in the coming decades?
- Seeing your leadership position as a privilege, not a right
- Serving as activist-in-chief for your constituents
- Operating in a time frame longer than tenure
- Believing in and relying on partnerships
- Feeding constructive discontent
Seeing your leadership position as a privilege, not a right
Twenty-first-century CEOs are keenly aware that their role comes with great responsibility. Rather than view their remit as “maximize shareholder value,” they realize that it is to serve their stakeholders’ best interests. As John Replogle, CEO of consumer goods company Seventh Generation explained,
The difference [between CEOs operating with twentieth- versus twenty-first-century mind-sets] starts with how we view our position. Understanding how you view your position as CEO informs where you put your emphasis. I approach my role as CEO as one of privilege, responsibility, and stewardship.
While some CEOs emphasize the creation of shareholder value, my view leads me to emphasize actions and investments that further Seventh Generation’s mission.