answer 8 question, each one around 60 words

answer 8 questions, each one around 60 words basic one the second file (textbook)

Study and prepare answers for the 8 questions below. During your Oral Quiz, you will be asked to give an answer for 1 of the questions.

LDRS 301 oral quiz questions

1. Describe the leadership journey of Howard Schultz. How did his greatest talent impact his leadership and success? What advice would Howard Schultz give to your leaders?

1. What is the Journey to Authentic Leadership? How would you describe and explain each phase? Why is it necessary to take that journey?

1. What are five phases of Losing Sight of Your True North? How would you describe and explain each phase?

1. Why do Leaders lose their way? Explain. What can be done to stop this process? Who is a leader who has lost their way? This could be someone you may or may not know personally.

1. Describe the Crucibles of Daniel Vasella and his long journey. What was the impact on his leadership? What advice would Daniel give your leaders?

1. What was the Crucible for Bill George, the author of True North?  How did he describe it? Describe why Bill George says that crucibles are important in developing leadership skills.

1. What is Arianna Huffington’s story, what contributed to her success? How did this happen? What were her challenges? What advice would Arianna give to your leaders?

1. Describe each step for Gaining Self-Awareness. Why is each step important? Why is self awareness important in leadership? True of False: A Leader really does not really need to be self aware.

Study and prepare answers for the 8 questions below. During your Oral Quiz, you will be asked to give an answer for 1 of the questions. LDRS 301 oral quiz questions

WEBCINTRO 07/02/2015 3:33:52 Page 12

WEBFFIRS 07/02/2015 3:57:52 Page i
Discover Your
True North
Expanded and Updated Edition
Bill George

WEBFFIRS 07/02/2015 3:57:52 Page ii
Cover image: Compass  iStock.com/LdF
Cover design: Wiley
Copyright  2015 by Bill George. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
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Library of Congress Cataloging-in-Publication Data:
George, Bill (William W.)
[Finding your true north.]
Discover your true north/Bill George.-Second edition, Expanded and Updated Edition.
pages cm
Revised edition of the author’s Finding your true north, 2008.
Includes index.
ISBN 978–1–119–08294–1 (hardback); ISBN 978–1–119–08297–2 (ePDF);
ISBN 978–1–119–08295–8 (ePub)
1. Leadership. 2. Organizational effectiveness. I. Title.
HD57.7.G45814 2015
658.4’092-dc23 2015013574
Printed in the United States of America
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WEBFFIRS 07/02/2015 3:57:52 Page iii
This book is dedicated to my family. First to my wife, Penny,
whose love, passion for life, and counsel have enabled all the
Georges to discover our True North. And to our sons, Jeff
and Jon, and our daughters-in-law, Renee and Jeannette,
who are making important contributions to the world as
authentic leaders.

WEBFFIRS 07/02/2015 3:57:52 Page iv
BEST-SELLING BOOKS BY BILL GEORGE
Authentic Leadership: Rediscovering the Secrets to Creating Lasting Value
(2003)
True North: Discover Your Authentic Leadership (2007) (with Peter Sims)
Finding Your True North: A Personal Guide (2008) (with Nick Craig and
Andrew McLean)
7 Lessons for Leading in Crisis (2009)

WEBFTOC 07/02/2015 3:7:35 Page v
Contents
Preface The Remarkable Legacy of Warren Bennis vii
Foreword David Gergen xi
Introduction 1
Part One: Your Journey to Leadership 13
1. Your Life Story 15
Lead Story: Howard Schultz, Chair and CEO of Starbucks
2. Losing Your Way 41
Lead Story: Rajat Gupta, Worldwide Managing Director of
McKinsey
3. Crucibles 57
Lead Story: Daniel Vasella, Chair and CEO of Novartis
Part Two: Developing as an
Authentic Leader
77
4. Self-Awareness 79
Lead Story: Arianna Huffington, Founder of The
Huffington Post
5. Values 103
Lead Story: David Gergen, Harvard Professor and Presidential
Advisor
v

WEBFTOC 07/02/2015 3:7:35 Page vi
6. Sweet Spot 123
Lead Story: Warren Buffett, Founder and CEO of Berkshire
Hathaway
7. Support Team 142
Lead Story: Tad Piper, Chair and CEO of Piper Jaffray
8. Integrated Life 159
Lead Story: John Donahoe, CEO of eBay
Part Three: Your True North Meets the World 179
9. I to We 181
Lead Story: Nelson Mandela, President of South Africa
10. Purpose 199
Lead Story: Ken Frazier, Chair and CEO of Merck
11. Empowerment 219
Lead Story: Anne Mulcahy, Chair and CEO of Xerox
12. Global Leadership 243
Lead Story: Paul Polman, CEO of Unilever
Afterword Stakeholders in Society 265
Lead Story: Jack Ma, Founder of Alibaba
New Leaders Featured in Discover Your True North 275
Participants from the Original Research for True North 277
Where Are They Now? 279
References 287
About the Author 293
Acknowledgments 295
Index 297
vi CONTENTS

WEBFPREF 07/02/2015 3:50:20 Page vii
Preface
The Remarkable Legacy of
Warren Bennis
Warren Bennis was one of the great pioneers in the field of
leadership. Small in physical stature, he was a giant in his intellect,
his heart, and his spirit. Just as Peter Drucker was the father of
management, Bennis was the father of leadership.
Bennis transformed our understanding of what it means to be a
leader. He was the first scholar who said leadership is not a set of
genetic characteristics, but the result of a lifelong process of self-
discovery. Rejecting the notion that leaders are born with certain
traits, he opened the door to the real source of leadership: within you.
He wrote:
The most dangerous leadership myth is that leaders are born—that there is a
genetic factor to leadership. This myth asserts that people simply either have
certain charismatic qualities or not. That’s nonsense; in fact, the opposite is
true. Leaders are made rather than born.
He showed how leaders develop through their life experiences,
are shaped by their crucibles, and emerge ever stronger to take on
responsibilities of leadership. He said unequivocally, “Leadership is
character,” adding,
It is not just a superficial question of style, but has to do with who we are as
human beings, and with the forces that have shaped us. The process of becoming
a leader is much the same as the process of becoming an integrated human
being.
vii

WEBFPREF 07/02/2015 3:50:20 Page viii
Bennis’s early life was deeply influenced by his association at
Antioch College and later at the Massachusetts Institute of Tech-
nology with Douglas McGregor, author of The Human Side of
Enterprise. While in Cambridge, he connected with Abraham
Maslow (creator of Maslow’s Hierarchy of Needs), Peter Drucker,
Paul Samuelson, and Erik Erikson, whose theories on the eight stages
of human development influenced Bennis’s own generativity in his
later years. He went on to write 30 books. Many of today’s influential
leadership authors, such as Tom Peters, Nitin Nohria, David
Gergen, Jim O’Toole, Bob Sutton, Jeff Sonnenfeld, and Doug
Conant are indebted to Bennis for their ideas.
As president of the University of Cincinnati, he realized his
personal truth, “I was never going to be able to be happy with
positional power. What I really wanted was personal power: having
influence based on my voice. My real gift is what I can do in the
classroom and as a mentor.” Following a heart attack in 1979, he
found his home at the University of Southern California.
Bennis’s influence on business leaders was widespread and
profound. Thousands of leaders who never knew him were inspired
by his writings and adopted his approach to leadership. Many chief
executive officers (CEOs) have told me personally what a profound
influence he had on their leadership.
I first encountered his writing in 1989 when I readOn Becoming a
Leader. It was a revelation: Finally, I had found a philosophy of
leadership I could resonate with. Throughout my years at Medtronic
and Harvard Business School (HBS), I have built on his philoso-
phies in my work and teaching.
We first met at theWorld Economic Forum in the late 1990s. He
suffered from heart problems, and had recently had a Medtronic
defibrillator implanted. In December of 2000 I invited him as a guest
patient to an annual Medtronic event, where he graciously thanked
the employees who designed and manufactured his defibrillator in
front of 10,000 people.
He was fond of saying he had Medtronic “in his heart” and then
describing how his defibrillator saved his life half a dozen times. I once
viii PREFACE

WEBFPREF 07/02/2015 3:50:20 Page ix
witnessed this in person in Cambridge. While he was speaking, his
defibrillator went off, and he slumped to the ground, dropping his
papers. Ever the gracious soul, he picked up his papers, apologized for
the disruption, and continued his talk. When it went off a second
time 10 minutes later, the Cambridge Fire Department escorted him
to safety.
In 2002, my wife, Penny, and I attended a seminar Bennis and
David Gergen led at the Aspen Institute. At the time I was eager
to write a book on my experiences at Medtronic but was struggling to
find a publisher. My intent was to offer practical approaches to
leading and develop leaders that enabled people to be their authen-
tic selves, rather than emulating others. With Bennis’s encourage-
ment, Jossey-Bass published Authentic Leadership as part of the
Warren Bennis Signature Series. Bennis served as executive editor
and wrote in the foreword, “Timeless leadership is always about
character, and it is always about authenticity.”
He became my mentor, friend, and intellectual colleague, and
gave me the courage to become a writer. As executive editor for my
four books in the Warren Bennis Signature Series, he generously
shared his time and his insights. In the midst of writing True North,
Peter Sims and I spent five days with him going over the conceptual
ideas and stories used in the book. Unlike many great scholars who
protect their ideas, Bennis genuinely wanted me to expand on his
and make them fully accessible to the new generation of leaders,
which he later called “the crucible generation.” We shared a
common aim to influence the next generation to lead with clear
purpose to serve others and make the world a better place.
Two months before he died, Bennis asked my wife and me to
discuss leadership in the next-to-last class he ever taught. Although
Bennis was beset with bodily ills, his mind and humanity were as sharp
as ever.What other professors have you knownwhowere still teaching
at age 89? Over dinner that evening Penny asked what he would like
on his tombstone. He replied, “Generous Friend.” A generous friend
is just what Bennis was to thousands of friends, students, scholars,
PREFACE ix

WEBFPREF 07/02/2015 3:50:20 Page x
and mentees whom he influenced with kindness, buoyancy of spirit,
and wisdom.
Bennis’s last book, Still Surprised, has a photo of him walking
barefoot on the beach with his pant legs rolled up, leaving behind
large footprints in the sand. These footprints serve as a calling to
incorporate his ideas in our leadership. Ultimately, this will become
Bennis’s greatest legacy. They bring to mind a stanza from Henry
Wadsworth Longfellow’s A Psalm of Life:
Lives of great men all remind us
We can make our lives sublime,
And, departing, leave behind us
Footprints on the sands of time.
x PREFACE

WEBBLAST 07/02/2015 3:53:10 Page xi
Foreword
When Peter Drucker was in his prime, CEOs often traveled across
the country to California to seek his counsel on how to lead and
manage their companies. He was an iconic figure in the business
world, the father of management studies, whose 30 books were
highly influential in shaping modern global companies. As I found in
conversation late in his life, he had a wisdom about him that was
spellbinding.
Upon his death 10 years ago, people naturally asked, “Who will
carry on Peter’s work?” Soon it became apparent that the most
obvious candidate was Warren Bennis, and once again, CEOs made
the trek to California to meet quietly with one of the sweetest, wisest
men I have been blessed to know. Warren was the father of
leadership studies in American universities, the man who gave
them academic legitimacy through his two dozen books, and the
best mentor and friend one could possibly have.
Upon his death a year ago, the question naturally arose again:
“Well, who will now carry onWarren’s work?”With the publication
of his sixth and most important book, Discover Your True North, we
may well have our candidate: Bill George. There are obvious
differences: Bill himself would modestly point out that both Drucker
and Bennis were lifelong scholars deeply schooled in theory; by
contrast, Bill first made his mark as a highly successful CEO of a large
company before becoming a major thought leader. Yet all three have
been at the forefront in shaping leadership and management prac-
tices of successive generations.
xi

WEBBLAST 07/02/2015 3:53:10 Page xii
By chance,Warren introduced me to Bill along with Dan Vasella
of Novartis at a dinner in Davos, Switzerland, where we were all
attending the World Economic Forum in 2001. Bill was coming off
his years as CEO ofMedtronic and was beginning to pull together his
thoughts and experiences about leadership so that he could share
them with younger business leaders.
Soon Bill published his first book, essentially a memoir, titled
Authentic Leadership, and it was quickly a best seller. Without
realizing it, he had launched an entirely new career, one with
even greater impact than his first. In reading Discover Your True
North, you will find not only a distillation of his ideas about
leadership but also revealing portraits of a galaxy of more diverse
leaders and what they have learned on their own journeys toward a
True North. This book bids to be a classic, standing alongside The
Effective Executive by Peter Drucker and On Becoming a Leader by
Warren Bennis. I am proud to call Bill a friend and trusted adviser—
and to salute him on the completion of his best book.
Here’s what is essential for a reader to understand: Experience
shows that Bill’s ideas not only work well in practice but also apply
across the board, helping not only business leaders but those in the
civic and public sectors as well. Most books that come from the
academy are intended for a small audience of specialized scholars.
That is the way advances in knowledge are often made. But non-
scholars wonder how this progress applies to them.
Bill George’s work—like Warren’s and Peter’s—intentionally
crosses the bridge between the academy and practice. Through
writing, teaching, and mentoring, he is helping leaders become
better at leading themselves and, in turn, their organizations. At
present more than two dozen CEOs of major global companies are
calling on him regularly for counsel and advice.
The evidence shows that leaders from across the world are
hungry to discover their True North and to make it their polar
star. After initial teaching stints at the International Institute for
Management Development (IMD) in Europe and at Yale School of
Management, Bill came to the Harvard Business School (HBS) as a
xii FOREWORD

WEBBLAST 07/02/2015 3:53:10 Page xiii
professor of management. There in 2005, he introduced his course,
Authentic Leadership Development, as a second-year elective.
Students embraced it with growing enthusiasm, such that it has
become one of the most popular courses at HBS and attracts a
growing number in executive education.
Bill no longer teaches the master of business administration
course but instead is focusing on executive education, where CEOs
and senior executives focus on their leadership, including three
courses each year for CEOs. Now there is a cadre of other faculty
members who are devotees, led by Scott Snook (a retired army
officer) and Tom DeLong and blessed by Dean Nitin Nohria.
Fortunately, Bill’s course has migrated to the Harvard Kennedy
School (HKS), where I am a professor of practice and codirector of
our Center for Public Leadership. Dana Born, a retired air force
general and the first woman in any military branch to gain flag rank
while at a military academy, has just started teaching the course, and
once again students are responding with gusto. Moreover, Bill has
introduced True North to an annual training program at the HKS for
Young Global Leaders chosen by the World Economic Forum.
Attendees love what the program offers, especially the deep-dive,
small-group conversations every morning over breakfast.
Altogether, some 6,000men andwomenhavenowbeen trained at
Harvard alone in Bill’s ideas about authentic leadership. Longitudinal
studies are not yet possible onhowmuch hemay have shaped lives and
leadership, but anecdotal evidence points to encouraging results.
One group that has had lots of exposure to Bill and his work is
students who have pursued joint degrees at HBS and HKS and in
their third year have received scholarships from Bill and Penny
George. These George Fellows, typically in their late twenties, have
a home at our Center for Public Leadership and meet frequently,
often with Bill and Penny. Bill generously mentors a number of them
and remains close long after they have graduated. Altogether, the
George Fellowship now has 100 alumni.
To be sure, many had transformative experiences that strength-
ened their leadership before they became George Fellows. Even so,
FOREWORD xiii

WEBBLAST 07/02/2015 3:53:10 Page xiv
their recent achievements have been impressive.Here are a fewwhom
Bill continues to mentor: Seth Moulton won an upset victory in his
campaign for Congress and has attracted a national following. Maura
Sullivan is now serving as an assistant secretary at the Department of
Veterans Administration. Nate Fick is CEO of Endgame as well as
former CEOof theCenter for aNewAmerican Security and author of
One Bullet Away. Brian Elliott founded Friendfactor, a lesbian, gay,
bisexual, and transgender (LGBT) nonprofit for straight people that
has been pivotal in winning battles for gay rights. Rye Barcott is
running a venture fund for solar installations in North Carolina; was
selected as a Young Global Leader at Davos; and is author of It
Happened on theWay toWar. JohnColeman is a principal of Invesco in
Atlanta and coauthored How to Argue Like Jesus. Stephen Chan is
chief of staff for theBoston Foundation. Peter Brooks works for awater
technology company and directs the Warrior-Scholar Project. Jona-
than Kelly runs a private equity company based in Singapore. And
Claude Burton is directing marketing for a rapidly growing informa-
tion technology firm in Brazil. Can there be any doubt that the ideas
here apply to emerging leaders from every sector of life and across
national boundaries?
As this book is being published, the world is slipping ever more
deeply into a leadership crisis. For people everywhere, life is becom-
ing ever more volatile and unpredictable. Instead of putting a firm
hand on the wheel, many leaders seem unable to steer toward safe
ports in the storm. A survey of global opinion the World Economic
Forum published in 2015 found that 76 percent believe we have had
a serious loss of leadership. Business leaders have recovered some of
their ground lost since 2008–2009, but they rank only modestly
above political leaders.
This book can perhaps help us find our way. If individual leaders
can recognize when they have drifted away from True North and
make successful course corrections, as Bill George argues, nations
can as well. Surely, authentic leadership beats what we have now.
David Gergen
xiv FOREWORD

WEBCINTRO 07/02/2015 3:33:52 Page 1
Introduction
Have you discovered your True North? Do you know what your life
and your leadership are all about?
Leadership starts with being authentic, the genuine you. The
purpose of Discover Your True North is to enable you to become
the leader you want to be. In the process you will discover your
True North—the internal compass that guides you successfully
through life.
Your True North
True North is your orienting point—your fixed point in a spinning
world—that helps you stay on track as a leader. It is derived from
your most deeply held beliefs, your values, and the principles you
lead by. It is your internal compass, unique to you, that represents
who you are at your deepest level.
Just as a compass needle points toward a magnetic pole, your
True North pulls you toward the purpose of your leadership. When
you follow your internal compass, your leadership will be authentic,
and people will naturally want to associate with you. Although
others may guide or influence you, your truth is derived from your life
story. As Warren Bennis said, “You are the author of your life.”
Discovering your True North takes a lifetime of commitment
and learning. As you are tested in the world, you yearn to look at
yourself in the mirror and respect the person you see and the life you
are leading. Some days will be better than others, but as long as you
are true to who you are, you can cope with the most difficult
circumstances life presents.
1

WEBCINTRO 07/02/2015 3:33:52 Page 2
The world may have very different expectations for you than you
have for yourself. Whether you are leading a small team or at the top
of an organization, you will be pressured by external forces to respond
to their needs and seduced by rewards for fulfilling those needs.
These pressures and seductions may cause you to detour from your
True North. When you get too far off course, your internal compass
tells you something is wrong and you need to reorient yourself. It
requires courage and resolve to resist the constant pressures and
expectations confronting you and to take corrective action when
necessary.
As CEO of Sara Lee Brenda Barnes said, “The most important
thing about leadership is your character and the values that guide
your life.” She added:
If you are guided by an internal compass that represents your character and
values, you’re going to be fine. Let your values guide your actions and don’t
ever lose your internal compass. Everything isn’t black or white. There are a lot
of gray areas in business.
When you discover your True North, you find coherence
between your life story and your leadership. A century ago psychol-
ogist William James wrote:
I have often thought that the best way to define a man’s character would be to
seek out the particular mental or moral attitude in which . . . he felt himself
most deeply and intensely active and alive. At such moments there is a voice
inside which speaks and says: “This is the real me!”
Can you recall a time when you felt most intensely alive and
could say with confidence, “This is the real me”? Professionally, I had
that feeling from the first time I walked into Medtronic in 1989 and
joined a group of talented people dedicated to the mission to
“alleviate pain, restore health, and extend life.” I felt I could be
myself and be appreciated for who I was and what I could contribute.
2 INTRODUCTION

WEBCINTRO 07/02/2015 3:33:52 Page 3
I sensed immediately that my values aligned with the organization’s
values.
The Rise of Authentic Leaders
When I wrote Authentic Leadership in 2003, the most common
question I received was “What do you mean by authenticity?” To
me, being authentic was the natural way of leading, but many people
in that era of charismatic leaders considered leading authentically a
new idea.
Today authenticity is seen as the gold standard for leadership. 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. Nor should
leadership be conflated with your leadership style, managerial skills,
or competencies. These capabilities are very important, but they are
the outward manifestation of who you are as a person. You cannot
fake it to make it, because people sense intuitively whether you are
genuine.
The hierarchical, directive leadership style so prevalent in the
past century is fading fast in favor of today’s collaborative leaders,
who believe in distributed leadership at all levels. The old notion of
leaders as the smartest guys in the room—as Enron CEO Jeff Skilling
typified—has been replaced by leaders with high levels of emotional
intelligence (EQ).
Because of this move toward greater authenticity, we are blessed
with much higher caliber leaders today. In discovering their True
North, they have committed to leading with purpose to make a
difference in the world and leave behind lasting legacies. The quality
of today’s leaders is reflected in the lasting results they are achieving
within their organizations.
For this all-new edition, my colleague Zach Clayton and I
interviewed and studied 47 authentic leaders that represent the
INTRODUCTION 3

WEBCINTRO 07/02/2015 3:33:52 Page 4
diversity of the new generation of global leaders—among them,
Unilever’s Paul Polman, PepsiCo’s Indra Nooyi, Alibaba’s Jack Ma,
the Huffington Post’s Arianna Huffington, Merck’s Ken Frazier, and
Sojourners’ Jim Wallis.
Before writing True North in 2007, our research team of Peter
Sims, Diana Mayer, Andrew McLean, and I set out to get definitive
answers to the question of how to develop authentic leaders. We
interviewed 125 authentic leaders to learn the secrets of their
leadership. This research constitutes the largest in-depth study
ever undertaken on how business leaders develop.
We circled back to most of the leaders interviewed for the first
edition to get updated on their progress as leaders. Much to our
pleasure, we found that the vast majority of them are doing excep-
tionally well. Some have moved to new positions, some have retired
from their organizations and taken on new challenges, but almost all
of them continue to make vital contributions to business and society.
Only a handful have failed.
In Discover Your True North, we retain the structure of the first
edition, but go much deeper into what we have learned about
leadership in the past decade. It includes many insights that my
Harvard Business School colleagues and I, as well as practitioners
and scholars around the world, have learned about leaders: how they
discovered their True North, developed as authentic leaders, became
global leaders, and stayed on the course of their True North
throughout their lifetimes.
Although the 47 new leaders included in Discover Your True
North are more international and more diverse than the first group,
their stories and beliefs about leadership showed a high level of
congruence with the earlier interviewees. (The back of the book
contains the list of interviewees for this updated edition.)
Rather than waiting to get to the top to become leaders, they
looked for every opportunity to lead and to develop themselves.
Every one of them faced trials, some of them severe. Many cited
these experiences, along with the people who helped them
develop, as primary reasons for their success. Without exception,
4 INTRODUCTION

WEBCINTRO 07/02/2015 3:33:52 Page 5
these leaders believed being authentic made them more effective
and successful.
As the result of our research into these leaders, we have a clearer
understanding of what constitutes an effective and authentic leader.
We know that each leader is unique, just as each human being is.
The reality is that no one can be authentic by trying to be like someone
else. You can learn from others’ experiences, but you cannot be
successful trying to be like them. People will only trust you when you
are genuine and authentic.
If you create a false persona or wear a mask, people will quickly
see through you. As Reatha Clark King, chair of the National
Association of Corporate Directors, said:
If you’re aiming to be like somebody else, you’re being a copycat because you
think that’s what people want you to do. You’ll never be a star with that kind of
thinking. But you might be a star—unreplicable—by following your passion.
Amgen chairman and CEO Kevin Sharer, who gained priceless
experience at the beginning of his career by working as JackWelch’s
assistant, saw the downside of General Electric’s cult of personality in
those days. “Everyone wanted to be like Jack,” he explained.
“Leadership has many voices. You need to be who you are, not
try to emulate somebody else.”
The Leadership Transformation
What has caused this dramatic change in today’s leaders?
As CEO of Medtronic in the 1990s, I witnessed firsthand many
corporations choose the wrong people as CEO. Under pressure from
Wall Street to maximize short-term earnings, boards of directors
frequently selected leaders for their image, style, and charisma rather
than their substance and character. Many of these leaders put their
companies at risk by focusing on the trappings and spoils of leader-
ship instead of building their organizations for the long term. When
INTRODUCTION 5

WEBCINTRO 07/02/2015 3:33:52 Page 6
those who failed walked away with enormous financial settlements,
confidence in business leaders further eroded.
These stock market pressures boomeranged in the fall of 2008
when many financial institutions became insolvent, forcing the
U.S. government to intervene to save the economic system from
complete collapse. In the deep recession that followed, millions of
Americans depleted their savings and unemployment rose above
10 percent. The root cause of this crisis was not financial instru-
ments, such as subprime mortgages, but failed leaders, just as it was
in the early 2000s.
As a result, public trust in business leaders fell to its lowest level
in 50 years. In business, trust is the coin of the realm. The success of
any organization depends upon 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. More than seven years
after the global financial crisis, the public still has low trust in
business leaders.
The positive side of these crises is the high quality of leaders who
have emerged in the new generation and how well they have learned
the lessons of these debacles. These leaders lived through the
corporate governance debacle of 2003, when Enron and WorldCom
went bankrupt, and survived the global financial collapse of 2008.
From these negative experiences when many leaders went awry,
today’s leaders learned what not to do. They saw many of their
predecessors get caught in the trap of chasing money, fame, and
power, and lose sight of their True North. They learned the perils of
putting self-interest ahead of the institutions they were chosen to
lead. Most important, they learned that being authentic is the most
effective and sustainable way to lead.
As we will see through their stories, today’s leaders have dis-
covered their True North and are pursuing it to the best of their
abilities. And yet, leading an organization today is much more
difficult than when I was CEO. Today’s leaders have to cope
with vastly increased pressures for short-term results and far greater
6 INTRODUCTION

WEBCINTRO 07/02/2015 3:33:52 Page 7
legal and regulatory compliance, all of which can pull them off the
course of their True North.
In reading Discover Your True North, you may wonder why we
focus so much on your life story and on developing yourself, as
opposed to leading others. As we have learned from working with
many leaders, the hardest person you will ever have to lead is yourself.
Once you are fully comfortable with who you are—and feel good
in your own skin—leading others authentically becomes much
easier.
Authentic leaders who follow their True North have learned
from their crucibles and setbacks. They have the resilience to resist
pressures and seductions. They know they must be authentic to gain
legitimacy with those with whom they work and the multiple
stakeholders who have vested interests in their organizations.
They are committed to building sustainable value for their institu-
tions, while producing near-term results.
The fact that business today is far more global than it was a
decade ago has significant implications for leadership throughout the
world. As World Economic Forum USA chair Jean-Pierre Rosso
reflected, “Today’s leaders are more global, more open, and more
concerned about societal issues than their predecessors.”
The new generation of leaders introduced here are much more
diverse than their predecessors, more global in their outlook and
national origin, and more likely to be promoted from within. Many
more women, people of color, and leaders who live and work
outside their country of origin are among today’s authentic leaders.
They have global visions and a desire to make lasting contribu-
tions. As a result, authentic global leaders who understand today’s
global business world are rising to the top of organizations around
the world.
As Fortune’s Manager of the Century, Jack Welch has long been
thought of as the prototypical leader of the twentieth century.
Unilever’s Paul Polman is emerging as such a leader in this new
century. Figure I.1 shows some of the ways this generation of leaders
differs from its predecessors.
INTRODUCTION 7

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What is an authentic leader?Authentic leaders have discovered their
True North, align people around a shared purpose and values, and
empower them to lead authentically to create value for all stakeholders.
Authentic leaders are true to themselves and to what they
believe in. They engender trust and develop genuine connections
with others. Because people trust them, authentic leaders are able to
motivate them to achieve high levels of performance. Rather than
letting the expectations of others guide them, they are their own
persons and go their own ways. As servant leaders, they are more
concerned about serving people than about their own success or
recognition.
This is not to say that authentic leaders are perfect. Far from it.
All leaders have weaknesses and are subject to human frailties and
mistakes. Yet by acknowledging their shortcomings and admitting
their errors, their humanity and vulnerability come through, and
they are able to connect with people and inspire them.
Discover Your True North is written for anyone who wants to be
an authentic leader and discover his or her True North. It is for
leaders at all stages of their lives, from students aspiring to lead to
those at the top of organizations. You are never too young, or too old,
to take on leadership challenges and lead authentically. Discover
Your True North is grounded in the hundreds of years of experience of
Figure I.1 Differences in Twentieth-Century and
Twenty-First-Century Leaders
8 INTRODUCTION

WEBCINTRO 07/02/2015 3:33:52 Page 9
the authentic leaders we interviewed as well as my own 50 years in
leadership roles. For you, the reader, it is an opportunity to learn
from authentic leaders and to create your own development plan to
become an authentic leader.
The bottom line is this: You can discover your True North right
now.
• You do not have to be born with the characteristics or traits of a
leader.
• You do not have to be at the top of an organization.
• You can step up and lead at any point in your life.
As CEO of Young & Rubicam Ann Fudge said:
All of us have the spark of leadership in us, whether it is in business, government,
or as a nonprofit volunteer. The challenge is to understand ourselves well enough
to discover where we can use our leadership gifts to serve others. We’re here for
something. Life is about giving and living fully.
Discover Your True North
Discovering your True North is hard work. You may take many years
to find it, as was the case for me.
This book does not contain six easy steps to discover your True
North or other simple formulas. It takes the opposite approach.
Discovering your True North requires you to maintain your indi-
viduality and retain your authenticity. This requires introspection,
support, and feedback of friends and colleagues. Ultimately, you must
take responsibility for your own development. Like musicians or athletes
born with great abilities, you must devote yourself to a lifetime of
development to realize your potential.
Part I of Discover Your True North examines the journey to
authentic leadership. It begins with the leaders’ life stories, which are
unique to them and more powerful than any set of characteristics or
INTRODUCTION 9

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leadership skills they possess. Next, the three phases of the leader’s
journey are dissected, looking at key steps in each phase of the
journey. During their journeys, many leaders lose their way. To
understand how derailment happens, we analyze five types of leaders
who see themselves as heroes of their own journeys. Finally, by
exploring the crucibles and life-changing experiences leaders have
had, we see how they overcame setbacks and built the resilience to
become authentic leaders.
Part II offers five elements of your internal compass that help you
develop as a leader and get back on trackwhen you are at risk of losing
yourway.This sectionprovides you the insights to stay true towhoyou
are as you confront challenges in theworld around you. It includes five
key areas of your development as a leader: self-awareness, at the center
of your compass, and at the four points, your values and principles,
sweet spot, support team, and integrated life (see Figure I.2).
Figure I.2 Book Map: Part I, Part II, and Part III
10 INTRODUCTION

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Part III describes your transformation from an I leader focused on
yourself to a We leader focused on serving others. Only when you
make this transformation will you be ready to discover the purpose of
your leadership and empower people around a shared purpose.
Finally, as the world becomes truly global, you can develop the
special qualities required to be an authentic global leader. In the
afterword, we challenge leaders to serve society by making capitalism
a force for solving the world’s most challenging problems.
After each chapter, you will find a series of exercises that you can
use to build your leadership development plan. Better yet, purchase
the companion workbook,The Discover Your True North Fieldbook: A
Personal Guide to Finding Your Authentic Leadership, written with my
colleagues Nick Craig and Scott Snook, which contains in-depth
exercises corresponding to each chapter in this book.
By dedicating yourself to discovering your True North, you will
become an authentic leader who can make a positive difference in
the world and leave a legacy for others to follow.
INTRODUCTION 11

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WEBPART01 07/02/2015 3:9:18 Page 13
Part One
Your Journey to Leadership
In our interviews with leaders about their development, the most
striking commonality was the way their life stories influenced their
leadership. Your life story is your foundation. It shapes how you, as a
human being, see the world. And in leadership, the most human of
all endeavors, it can propel you forward or hold you back.
In Part I we examine three topics:
1. How you frame your life story. Your journey through life will take
you through many peaks and valleys as you face the world’s trials,
rewards, and seductions. Reflection and introspection will help
you understand your life experiences, and in some cases reframe
them.
2. The risk of losing your way. Everyone experiences pressures and
difficulties in life, and all of us have to deal with fears and
uncertainties. In your life journey, you will be confronted with
seductions that threaten to pull you off course from your True
North. We will examine five archetypes that can cause you to
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WEBPART01 07/02/2015 3:9:18 Page 14
3. The role crucibles play in shaping your leadership. The way you deal
with your greatest adversities will shape your character far more
than the adversities themselves. Much like iron is forged by
heat, your most significant challenges and your most painful
experiences present the greatest opportunities for your personal
growth.
As you gain greater clarity and insight about your life’s journey,
you will discover the focus of your True North.
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1
YOUR LIFE STORY
The reservoir of all my life experiences shaped me as a
person and a leader.
—Howard Schultz, CEO, Starbucks
The journey to authentic leadership begins with understanding
yourself: your life stories, crucibles, and setbacks. This knowledge
gives you the self-awareness to discover your True North.
Howard Schultz’s Leadership Journey
In the winter of 1961, 7-year-old Howard Schultz was throwing
snowballs with friends outside his family’s apartment building in the
federally subsidized Bayview Housing Projects in Brooklyn, New
York. His mother yelled down from their seventh-floor apartment,
“Howard, come inside. Dad had an accident.” What followed has
shaped Schultz throughout his life.
He found his father in a full-leg cast, sprawled on the living room
couch.While working as a delivery driver, Schultz’s father had fallen
on a sheet of ice and broken his ankle. As a result, he lost his job—
and the family’s health care benefits. Schultz’s mother could not go
to work because she was seven months pregnant. His family had
nothing to fall back on. Many evenings, Schultz listened as his
parents argued at the dinner table about how much money they
needed to borrow. If the telephone rang, his mother asked him to tell
the bill collectors his parents were not at home.
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Schultz vowed he would do things differently. He dreamed of
building “a company my father would be proud to work at” that
treated its employees well and provided health care benefits. Little
did he realize that one day he would be responsible for 191,000
employees working in 21,000 stores worldwide. Schultz’s life expe-
riences provided the motivation to build Starbucks into the world’s
leading coffeehouse.
“My inspiration comes from seeing my father broken from the 30
terrible blue-collar jobs he had over his life, where an uneducated
person just did not have a shot,” Schultz said. These memories led
Schultz to provide Starbucks employees access to health coverage,
even for part-time workers.
That event is directly linked to the culture and the values of Starbucks. I wanted
to build the kind of company my father never had a chance to work for, where
you would be valued and respected, no matter where you came from, the color
of your skin, or your level of education. Offering health care was a transforming
event in the equity of the Starbucks brand that created unbelievable trust with
our people. We wanted to build a company that linked shareholder value to the
cultural values we create with our people.
Unlike some who rise from humble beginnings, Schultz is proud
of his roots. He credits his life story with giving him the motivation
to create one of the great business successes of the last 25 years. But
understanding the meaning of his story took deep thought because,
like nearly everyone, he had to confront fears and ghosts from his
past.
Brooklyn is burned into Schultz. When he took his daughter to
the housing projects where he grew up, she surveyed the blight and
said with amazement, “I don’t know how you are normal.” Yet his
experience growing up in Brooklyn is what enables Schultz to
connect with practically anyone. He speaks with a slight Brooklyn
accent, relishes an Italian meal, dresses comfortably in jeans, and
respects all types of people. He has not forgotten where he came from
or let his wealth go to his head: “I was surrounded by people who
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were working hand-to-mouth trying to pay the bills, felt there was no
hope, and just couldn’t get a break. That’s something that never
leaves you—never.
“From my earliest memories, I remember my mother saying that I
could do anything I wanted in America. It was her mantra.” His
father had the opposite effect. As a truck driver, cab driver, and
factory worker, he never earned more than $20,000 a year. Schultz
watched his father break down while complaining bitterly about not
having opportunities or respect from others.
As a teenager, Schultz clashed often with his father, as he felt the
stigma of his father’s failures. “I was bitter about his underachieve-
ment and lack of responsibility,” he recalled. “I thought he could
have accomplished so much more if he had tried.” Schultz was
determined to escape that fate. “Part of what has always driven me is
fear of failure. I know all too well the face of self-defeat.”
Feeling like an underdog, Schultz developed a deep determina-
tion to succeed. Sports became his early calling, because “I wasn’t
labeled a poor kid on the playing field.” As star quarterback of his
high school football team, he received a scholarship to Northern
Michigan University, becoming the first in his family to earn a
college degree. His fierce competitiveness never faded; it just shifted
from football to business.
Working in sales at Xerox, Schultz felt stifled by the bureaucratic
environment. While others thrived in Xerox’s culture, Schultz
yearned to go his own way. “I had to find a place where I could
be myself,” he said.
I could not settle for anything less. You must have the courage to follow an
unconventional path. You can’t value or measure your life experience in the
moment, because you never know when you’re going to find the true path that
enables you to find your voice. The reservoir of all my life experiences shaped
me as a person and a leader.
Schultz encountered Starbucks Coffee during a sales call at Pike
Place Market in Seattle. “I felt I had discovered a whole new
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continent,” he said. He actively campaigned to join the company,
becoming its director of operations and marketing. On a buying trip
to Italy, Schultz noticed the Milanese espresso bars that created
unique communities in their customers’ daily lives. He dreamed of
creating similar communities in America, focusing on creating coffee
breaks, not just selling coffee.
When he learned he could acquire Starbucks from its founders,
Schultz rounded up financing from private investors. As he was
finalizing the purchase, he faced his greatest challenge when his
largest investor proposed to buy the company himself. “I feared all
my influential backers would defect to this investor,” he recalled, “so
I asked Bill Gates Sr., father of Microsoft’s founder, to help me stand
up to one of the titans of Seattle because I needed his stature and
confidence.”
Schultz had a searing meeting with the investor, who told him,
“If you don’t go along with my deal, you’ll never work in this town
again. You’ll never raise another dollar. You’ll be dog meat.” Leaving
the meeting, Schultz broke into tears. For two frenzied weeks, he
prepared an alternative plan that met his $3.8 million financing goal
and staved off the investor.
If I had agreed to the terms the investor demanded, he would have taken away
my dream. He could have fired me at whim and dictated the atmosphere and
values of Starbucks. The passion, commitment, and dedication would have all
disappeared.
The saddest day of Schultz’s life came when his father died.
Schultz shared with a friend the conflicts he has had with his father,
and his friend remarked, “If he had been successful, you wouldn’t
have the drive you have now.” After his father’s death, Schultz
reframed his image of his father, recognizing strengths such as
honesty and commitment to family. Instead of seeing him as a
failure, he realized his father had been crushed by the system. “After
he died, I realized I had judged him unfairly. He never had the
opportunity to find fulfillment and dignity from meaningful work.”
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Schultz channeled his drive into building a company where his
father would have been proud to work. By paying more than
minimum wage, offering substantial benefits, and granting stock
options to all its workers, Starbucks offered employees what Schultz’s
father had never received and used these incentives to attract people
whose values are consistent with the company’s values. As a result,
the employee turnover at Starbucks is less than half that at other
retailers.
Among Schultz’s greatest talents is his ability to connect with
people from diverse backgrounds. He tells his story and the
Starbucks story at special events and visits two dozen Starbucks
stores per week. Each day he gets up at 5:30 AM to call Starbucks
employees around the world. He said, “Starbucks gave me the
canvas to paint on.”
Starbucks is the quintessential people-based business, where everything we do is
about humanity. The culture and values of the company are its signature and its
competitive difference. We have created worldwide appeal for our customers
because people are hungry for human connection and authenticity. Whether
you’re Chinese, Japanese, Spanish, or Greek, coffee is just the catalyst for that
connection. I don’t know if I was drawn to this business because of my
background, or whether it gave me the opportunity to connect the dots, but it
has come full circle for me.
In 2000, Schultz turned the reins over to a new CEO, Jim
Donald, but remained as board chair. In 2007, a controversial e-mail
he wrote to Donald and Starbucks’ executive committee expressing
his concerns that the Starbucks experience was becoming commodi-
tized was leaked to the press. This created a firestorm in the media
and among Starbucks’ customers and employees. In January 2008,
Schultz returned to Starbucks as CEO. One of his first moves was to
shut down all U.S. stores for a half day of employee training to
emphasize Starbucks’ need to restore its original culture. Starbucks’
spectacular results since then have validated the effectiveness of
Schultz’s leadership.
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Howard Schultz is one of dozens of authentic leaders who traced
their inspiration and success directly to their life stories. Like most
leaders, Schultz deals with both positive and negative thoughts that
compete in his mind. I call this phenomenon “dueling narratives,” a
phenomenon that influences even the most successful leaders.
Schultz’s positive narrative keeps him focused on his dream. Yet
he retains a deep fear of failure emanating from his father’s expe-
riences. Rather than let his negative narrative drag him down, he
uses it in conjunction with his positive narrative to keep Starbucks
focused on succeeding.
Your Life Story Defines Your Leadership
The leaders we interviewed discovered their True North by under-
standing their life stories. Their stories cover the full spectrum of
experiences, including the impact of parents, teachers, coaches,
and mentors; the support of their communities; and leadership in
team sports, scouting, student government, and early employment.
Many leaders were influenced by difficult experiences, such as
personal illness or illness of a family member; death of a loved one;
or feelings of being excluded, discriminated against, or rejected
by peers.
These leaders found their passion to lead through the uniqueness
of their life stories.
Not by being born as leaders.
Not by believing they had the characteristics, traits, or style of a
leader.
Not by trying to emulate great leaders.
Simply by being their authentic selves, they became great
leaders, using their gifts to help others. Some outstanding leaders,
such as Regeneron chair Roy Vagelos, did not see themselves as
leaders at all. Instead, they wanted to make a difference and inspire
others to join with them in pursuing common goals. If that isn’t
leadership, what is?
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As former secretary of Health andHuman Services JohnGardner
once said, “I guess I had certain leadership qualities that life was just
waiting to pull out of me.” Have you examined what leadership
qualities life wants to pull out of you? Let’s focus on the life stories of
two more leaders. As you read these stories, think about the ways
your life story inspires you and defines your leadership.
Dick Kovacevich: From Grocery Store
Clerk to Premier Banker
For 20 years as chairman and CEO of Wells Fargo, Dick Kovacevich
compiled the most successful track record of any commercial banker.
In his interview for this book, however, he did not focus on his
professional success but talked instead about how his experiences
growing up in a small town in western Washington shaped his
leadership philosophy.
Kovacevich was raised in a working-class family and interacted
with people of all incomes and education levels. The dairy farmers,
loggers, and workers that he knew at the local Weyerhaeuser sawmill
were intelligent people who worked hard and had high ethical
standards but lacked college educations. His teachers had a tremen-
dous influence on him, encouraging him to do well academically and
go to college.
From the age of 11, Kovacevich worked in a local grocery store,
which stimulated his interest in business. After school he played
sports, then rushed home so that he could eat before heading to work
from 6 to 9 PM. In the summers, he ran the produce department when
the manager went on vacation, handling displays, pricing, and
ordering. Those experiences taught Kovacevich the importance
of customer relations. He noted, “There I developed the intuition
and leadership skills, more than in business school, where there
weren’t any leadership courses.”
Athletics had a significant impact on Kovacevich’s development
as a leader. He played a team sport several hours every day, becoming
team captain in baseball and football. “On the athletic field I learned
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people can perform so much better as a team than the sum of their
individual talents. By trial and error, I learned skills I could apply in
business.”
If you had 11 quarterbacks on the field, you would lose every game. Just as
quarterbacks are overrated, CEOs are too. You can’t be an all-star quarterback
unless you have some great linemen, outstanding receivers, and good running
backs. Diversity of skills is an important element of any effective team. There is
no way that leaders who surround themselves with people just like them can be
effective. We need to recognize our weaknesses, but not amplify them, and then
surround ourselves with people whose strengths complement our weaknesses.
Kovacevich used that principle at Wells Fargo, surrounding
himself with talented executives who built the bank’s individual
businesses. He gave them authority to lead in their own way, while
acting as quarterback of the team.
His life experience growing up in a small town profoundly
influenced his banking philosophy. While other banks were using
computers to eliminate customer service personnel, Kovacevich
endeavored to make Wells Fargo the most client-friendly bank in
every community. The primary concern of its employees is helping
clients meet their financial needs. Because Kovacevich and his
handpicked successor, John Stumpf, surrounded themselves with
highly talented executives, Wells Fargo navigated the 2008 financial
crisis better than any commercial bank.
Reatha Clark King: From Cotton Fields to the Boardroom
Reatha Clark King’s roots trace to a rural community, where many
encouraged her to become a leader. King acknowledged, “I didn’t get
here on my own. I am standing on the shoulders of the giants who
helped me get launched.”
King grew up in Georgia in the 1940s, the daughter of farm
laborers. Her father left the family when she was young, so her
mother worked as a maid to support her three children. Her family
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was so poor that she often had to leave school to work in the cotton
fields for $3 per day so that her mother could pay the bills. “Those
were bitter moments in my experience, because white children
didn’t have to leave school,” she recalled. “That contrast was so
clear and so wrong.”
Her church was a haven amid constant poverty and discrimina-
tion. “I have fond memories of going to church every Sunday
morning. I can still close my eyes and see my grandmother praying.”
The older women of the church identified King’s special abilities,
noticing her intellectual potential, initiative, work ethic, and
dependability. “The sisters, teachers, and people in the community
kept an eye on me, and encouraged me to overcome unjust barriers
against black people.”
King credited her grade school teacher and the school librarian
with influencing her development. They encouraged her to go to
Clark University in Atlanta, where she won a scholarship and
worked in the library for 35 cents an hour to pay for room and
board. While King studied at Clark, the chair of the chemistry
department mentored her, stimulating her interest in becoming a
research chemist.
She applied to the University of Chicago’s doctoral program, a
bold step for a poor woman from Georgia. After earning her PhD in
physical chemistry, she worked at the National Bureau of Standards
and taught at York College in New York City. Even there, things
were not easy. “One black faculty member called me an Uncle Tom
for trying to resolve issues,” she recalled. “That was one of the most
hurtful moments of my life.”
She got her first opportunity to lead when she became president
of Metropolitan State University in Minneapolis. Even then she did
not see herself as a leader.
Others thought of me as a leader, but I saw myself as someone doing what
needed to be done. My reasons for leading were not centered on my needs but
on the needs of women, my people, and my community. I saw compelling
challenges to be met. If no one else is willing or capable of leading, then it is my
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obligation to step up to the challenge. My inspiration comes from the sisters and
teachers who had such great influence on my life.
While at Metro State, King was recruited by the CEO of General
Mills to be president of its foundation. Using this platform, she
pioneered programs to help young people of color. Since retiring
from General Mills, she has devoted her energies to corporate
boards. Her reputation grew as she was elected a director of Exxon-
Mobil, Wells Fargo, and other companies. An advocate for strong
corporate governance, King currently chairs the National Associa-
tion of Corporate Directors, which named her director of the year in
2004. “I enjoy serving on corporate boards because diversity should
be at that table,” she said.
Throughout her life, King has used the inspiration of her life
story to stay on course to her True North. She reaches out and helps
others as she quietly walks past barriers of racial and gender
discrimination, without ever succumbing to anger. As comfortable
in the boardrooms of the world’s largest corporations as she is in
creating opportunities for the poor, King still worries whether she is
doing enough. “I’m leading toward a cause: to get more opportunities
for people. It is in my blood to remove unjust barriers and help
people appreciate themselves and be who they are.”
What Is Your Life Story?
What can you learn from the stories of Howard Schultz, Dick
Kovacevich, and Reatha Clark King? All of them, like the other
leaders interviewed, found the inspiration to lead in their own life
stories. By understanding the formative experiences of their early
lives, they have been able to reframe their understanding of their life
stories and shape their leadership around fulfilling their passions and
following their True North.
At this point, you may be asking, Doesn’t everyone have a life
story? What makes leaders’ stories different? Many people with
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painful stories see themselves as victims, feeling the world has dealt
them a bad hand. Some get so caught up in chasing the world’s
esteem that they never become genuine leaders. Or they lack the
introspection to connect the dots between their life experiences and
the goals they are pursuing now. Often this causes them to repeat the
mistakes that led to earlier problems.
The difference with authentic leaders lies in the way they frame
their stories. Their life stories provide the context for their lives, and
through them, they find the passion to make an impact in the world.
Novelist John Barth once said, “The story of your life is not your life.
It is your story.” In other words, it is how you understand yourself
through your story that matters, not the facts of your life. Leaders who
have reflected on their stories understand how important events and
interactions with people have shaped their approach to the world.
Reframing our stories enables us to recognize that we are not
victims at all but people shaped by experiences that provide the
impetus to become leaders. Our life stories evolve constantly as we
shape the meaning of our past, present, and future.
Can you connect the dots between your past and your future to
find your inspiration to lead authentically? What people or expe-
riences have shaped you? What have been the key turning points in
your life? Where in your story do you find your passion to lead?
Having considered how our life stories provide the basis for our
leadership, we are ready to embark on the journey to authentic
leadership.
The Journey to Authentic Leadership
When I graduated from college, I had the naive notion that the
journey to leadership was a straight line to the top. I learned the hard
way that leadership is not a singular destination but a marathon
journey that progresses through many stages until you reach your
peak. I was not alone. Of all the senior leaders we interviewed, none
wound up where they thought they would.
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Former Vanguard CEO Jack Brennan believes that the worst
thing people can do is to manage their careers with a career map:
“The dissatisfied people I have known and those who experienced
ethical or legal failures all had a clear career plan.” Brennan
recommended being flexible and venturesome in stepping up to
unexpected opportunities. “If you’re only interested in advancing
your career, you’ll wind up dissatisfied,” he said.
The idea of a career ladder places tremendous pressure on leaders
to keep climbing ever higher. Instead, Sheryl Sandberg, chief
operating officer (COO) of Facebook, favors the idea of a career
“jungle gym” where you can move up, down, or across. Realistically,
your development as a leader is a journey filled with many ups and
downs as you progress to your peak leadership and continue leading
through the final stage (see Figure 1.1).
The leader’s journey follows the new span of life, which often
runs into the nineties. Individuals move through three periods of
leadership with different types of leadership opportunities unfolding
in each. There will be differences in the pace at which leaders
navigate the timeline, but there are many commonalities among
their experiences.
Figure 1.1 The Journey to Authentic Leadership
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Phase I is “Preparing for Leadership,” where leaders develop
through education and studying, as well as extracurricular experi-
ences and early work as individual contributors. Phase II, “Leading,”
begins as individuals take on more responsibility for leading others
and culminates in their peak leadership experience. Phase III is
“Generativity,” a stage of human development psychologist Erik
Erikson identified. It begins when leaders have completed their
principal career leadership roles, and it continues for the rest of their
lives. In this phase, authentic leaders look for opportunities to spread
their knowledge and wisdom across many people and organizations,
even as they continue an active learning process.
Phase I: Preparing for Leadership
Phase I is preparing for leadership,whencharacter formsandpeople act
as individual contributors or lead teams for the first time. Today, very
few leaders make career commitments in their twenties. Increasingly,
they use the time following college to gain valuable work experience,
oftentimes changing jobs every 18 to 24 months to diversify their
experience. Many young leaders are interested in going to graduate
school in business, law, or government. Even somewhocomplete their
master’s degrees prefer individual contributor roles in consulting or
finance before committing to a specific company or industry.
There is a natural amount of self-absorption in this phase.
Measures of success in your teens and twenties are based primarily
on what you accomplish as an individual. Your performance deter-
mines what schools you are admitted to and how well you do in your
work. Here’s how Kleiner Perkins Caufield & Byers’s Randy Komisar
described it:
We begin life on a linear path where success is based on clear targets. Life gets
complicated when the targets aren’t clear, and you have to set your own. By
rubbing up against the world, you get to know yourself. Either do that, or you’re
going to spend your life serving the interests and expectations of others.
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He acknowledged that the start of the journey is particularly hard
for young people. “They look at me and say, ‘Hey, man. All I want to
do is to get a good job, buy a house, get married, and have kids.’”
Komisar said he wished life were so simple. Instead, he tells them:
Let me just plant this seed. Keep it alive and come back to it in 10 years, but
don’t flush it. Ask yourself the question “What do you want out of your life?” I
want to empower you for that time when it’s relevant to you.
Wendy Kopp: Stepping Up at 21
As a student at Princeton, Wendy Kopp developed a passion to
transform K–12 education. Growing up in a middle-class family in an
affluent Dallas suburb, she lived in a community that was “extra-
ordinarily isolated from reality and the disparities in educational
opportunity.” Kopp was influenced by her freshman roommate at
Princeton, who was from inner-city New York. Kopp described her
roommate as brilliant but unable to keep up with her studies because
her high school had not prepared her for the rigors of Princeton.
Ultimately, her roommate dropped out of school.
As a senior, Kopp burned with desire to transform education but
didn’t know how to get there. Not wanting to pursue the typical
corporate-training track, she went into “a deep funk.” As she
explored teaching, she realized many others also believed that
depriving kids of an excellent education was a national tragedy.
So she organized a conference of students and business leaders to
examine ways to improve K–12 education. During the conference,
an idea came to her: “Why doesn’t this country have a national
teacher corps of recent college graduates who commit two years to
teach in public schools?” Her rhetorical question inspired her to
found Teach For America (TFA), the most successful secondary
educational program of the past 25 years.
Kopp’s journey wasn’t easy. Lacking management experience
and permanent funding, Teach For America was constantly short of
cash, lurching from one crisis to the next. Time and again, Kopp
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threw herself into fundraising as she restructured budgets and
financing to cover deficits. After working 100 hours a week for
five years to build TFA to 500 new teachers per year, Kopp felt
overwhelmed by the financial pressures of raising money to keep the
organization going.
When many initial funders decided not to continue funding the
organization, losses mounted to a cumulative deficit of $2.5 million.
A blistering critique of TFA in an influential educators’ journal said,
“TFA is bad policy and bad education. It is bad for the recruits. It is
bad for the schools. It is bad for the children.” Reflecting on the
article, Kopp recalled, “It felt like a punch in the chest. I read it more
as a personal attack than an academic analysis of our efforts.”When
some of her original team left TFA, Kopp thought about shutting it
down. “Yet my passion for our cause and fear that we might let the
children down kept me going,” she said.
Kopp’s experience at such a young age is the essence of authentic
leadership: Find something you are passionate about, and inspire
others to join the cause. TFA’s crisis accelerated her development as
a leader. Twenty years after founding TFA, Kopp’s tireless efforts and
passionate leadership have paid off. Today the program has 11,000
corps members who are teaching more than 750,000 students.
Ian Chan: Creating a Scientific Revolution
Ian Chan is another young leader who discovered his passion to lead
at an early age. As his college graduation approached, he knew he
wanted “an opportunity that would get me excited to jump out of
bed every day and go to work.” After uninspiring experiences in
investment banking and private equity, he and his younger brother
focused on the human genome revolution.
The Chan brothers founded U.S. Genomics to revolutionize
medicine by delivering personalized genomics on a broad scale. They
attracted noted advisers, such as scientist Craig Venter, who origi-
nally mapped the human genome, and Bob Langer, a renowned
technologist. They began with a $100,000 credit card loan, and
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subsequently raised $52 million from venture capitalists, several of
whom joined the board as the Chan brothers gave up more than half
their ownership.
Over the next five years the company’s work attracted attention
in the scientific community and venture capital world as U.S.
Genomics became a pioneer in its field. When the founders pre-
sented the company’s exceptional performance in December 2001,
the board gave them a standing ovation. Yet, as the full potential of
U.S. Genomics became apparent to the venture capitalists, they
decided they needed a more experienced executive to lead it. Four
months later, Chan was shocked when his board told him he was
being replaced as CEO. “To this day, I have no idea why this
happened when things were going so well,” he said.
I put my heart and soul into it for many years, and then boom, it’s all gone. It
was gut-wrenching to have something taken away that I created and believed in
deeply. I still had some shares, but I wasn’t part of the enterprise anymore with
its mission I believe in. I wanted to continue fighting, but I felt helpless.
In hindsight, it was a rich experience I can build on for the next journey. I
had been working crazy hours and was very tired. I didn’t have a personal life
and needed more balance. To regroup, I spent two years getting my MBA.
That provided time for self-reflection and opportunities to interact with some of
the world’s top business leaders.
I realized I was still fortunate to have my health, family, and the privilege
of living in a free country. These should never be taken for granted. My heart is
still in entrepreneurship and biotechnology because there are so many untreat-
able diseases that provide opportunities to make broad impact.
Chan was a victim of his own success. Yet for all the heartache
and pain, he had an invaluable experience that has been formative
on his leadership journey. He and his brother, Eugene, rejoined
forces in 2007 to found Abpro, focusing on producing proteins
used in life sciences. They raised $1.5 million in seed capital but
have retained more than 50 percent ownership to avoid repeating
the U.S. Genomics experience. Chan said he learned from these
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experiences “the importance of pursuing your passion to make
scientific breakthroughs” but also “not to give up control to
outsiders.”
Unfortunately, fear of failure keeps many young leaders from
jumping into opportunities like Kopp and Chan did. Ann Fudge
offered a priceless point of view, noting, “Struggle and tough
experiences ultimately fashion you.”
Don’t worry about the challenges. Embrace them. Go through them even if they
hurt. Tell yourself, there is something to be learned from this experience. You
may not fully understand it now, but you will later. It’s all part of life, and life is
a process of learning. Every challenging experience develops your core of inner
strength, which gets you through those storms. Nothing worth doing in life is
going to be easy.
Phase II: Leading
The second phase of your leadership journey begins with a rapid
accumulation of leadership experiences. As you take on greater
responsibilities, you will likely face personal and professional set-
backs that test you to your core. These periods transform your
understanding of what leadership is all about and can dramatically
accelerate your development. Typically, your successive leadership
assignments will culminate in your peak leadership experience.
In Phase II, many leaders face experiences at work that dramati-
cally test their sense of self, their values, or their assumptions about
their careers. I call this “hitting the wall,” because the experience
resembles a fast-moving race car hitting the wall of the track,
something most leaders experience at least once in their careers.
Jeff Immelt: Hitting the Wall
General Electric (GE) CEO Jeff Immelt was a rising star in his
midthirties when he faced his toughest challenge. Asked to return to
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GE’s plastics business as head of worldwide sales and marketing, he
had reservations about accepting the move because it was not a
promotion. Jack Welch, the current CEO, told him, “I know this
isn’t what you want to do, but this is a time when you serve the
company.”
Facing stiff competition, the plastics division had entered into
several long-term, fixed-price contracts with key customers, includ-
ing U.S. automakers. When inflation spiked and his division’s costs
soared, Immelt’s operation missed its profit target by $30 million,
30 percent of its budget. Welch did not hesitate to reach down by
phone to pepper him with questions. Immelt tried to increase prices,
but progress was slow, and his efforts negatively affected GE’s
relationship with General Motors (GM). This intensified the pres-
sure on Immelt to produce results and required Welch to resolve
issues directly with GM CEO Roger Smith.
For Immelt, the year was a remarkably difficult one. As he looked
back at this experience, he noted, “Nobody wants to be around
somebody going through a low period. In times like that you’ve got
to be able to draw from within. Leadership is one of these great
journeys into your own soul.” Immelt lost the external validation
that comes from success during this assignment, yet demonstrated
the inner qualities—tenacity and resilience—necessary to lead
through hard times.
He needed these qualities as he faced far greater challenges as
Welch’s successor. The September 11, 2001, attacks occurred during
Immelt’s first week as CEO, negatively affecting several GE busi-
nesses, including jet engines, insurance, and financial services.
During the 2008 financial meltdown, GE’s balance sheet became
so precarious that Immelt telephoned President George W. Bush to
ask for financial support.
More than a decade later, Immelt is reinventing GE with a clear
focus on product innovation in health care, energy, and transporta-
tion. In those sectors, he is building on GE’s traditional manufactur-
ing and services strengths to include big data and advanced analytics
solutions. He is further reshaping GE by divesting major businesses
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such as NBCUniversal and parts of GE Capital that don’t align with
his strategy.
Hank Paulson: A Life of Service in All Sectors
Hank Paulson has contributed to the private, public, and philan-
thropic sectors with fervor and determination. I have known him
since he worked as assistant to the assistant secretary of defense
(comptroller), sitting at the same metal desk I’d sat in just two years
before. After two years, he moved to the White House staff of
President Richard Nixon as assistant to John Ehrlichman. In 1974,
he joined Goldman Sachs in its Chicago office, eventually running
its investment banking business before becoming COO in 1994. In
1998, he became CEO and led the company’s first public offering the
following year.
Paulson was in the midst of a highly successful era at Goldman
Sachs when President George W. Bush asked him to become
treasury secretary. Initially, he turned the position down, preferring
to continue running Goldman, but Bush’s chief of staff, Josh Bolton,
was persistent in recruiting him. Torn between his options, Paulson
asked former Goldman Sachs co-CEO Steve Friedman for advice.
Friedman simply asked, “Hank, if you turn down this opportunity to
serve your country, will you regret it later in life?” Paulson realized
just how committed he was to public service and decided to accept
the position.
For the sake of his country, it was a good thing Paulson accepted.
When the financial crisis hit, Paulson aggressively took charge,
working through the bankruptcy of Lehman Brothers; nationalizing
Fannie Mae, Freddie Mac, and American International Group
(AIG); bailing out Citibank; and finding new owners for Merrill
Lynch, Bear Stearns, Wachovia, Washington Mutual, and Coun-
trywide Financial. Throughout the crisis Paulson partnered with
Federal Reserve Board Chair Ben Bernanke to reopen credit markets
and capitalize the strong banks with the controversial Troubled
Asset Relief Program (TARP).
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This was a stressful time for Paulson. An extremely responsible
leader, he foresaw the risk of a 1929-style financial collapse and
resolved to do whatever was required to avoid it. Paulson is a
dedicated Christian Scientist who does not drink or smoke, and
was an Eagle Scout. At Dartmouth, he was Phi Beta Kappa and
played offensive lineman on Dartmouth’s football team, winning
All-Ivy, All-East, and honorable mention All-American honors. His
college nickname was “the Hammer.” In person, he is aggressive,
blunt, and physically intimidating. Nevertheless, in his book On the
Brink he described four times he had to excuse himself during
speeches or key meetings to go into the men’s room because he
had stress-induced dry heaves.
Throughout the financial crisis, Paulson made hundreds of
telephone calls, trying to understand what was happening, negoti-
ating solutions with private-sector leaders, and urging political
leaders to stay calm in the midst of the presidential campaign.
He told me he had full support from President Bush to take aggressive
actions that normally Bush would have opposed and to hold regular
calls with then Senator Barack Obama.
He became desperate while he was trying to persuade Congress to
pass the $700 billion TARP authorization because both Democrats
and Republicans had politicized the legislation. As Paulson described
the chaotic meeting President Bush called on September 25, 2008,
with Senators Obama and John McCain and Congressional leaders:
It got so ridiculous. I’d never seen anything like it before in politics or business—
or in my fraternity days. Finally the president said, “I’ve clearly lost control of
this meeting. It’s over.” Appalled and disheartened, I approached the Demo-
crats gathered in the Roosevelt Room and urged moderation. They shouted at
me to leave. I didn’t know what to do. In an attempt at levity, I walked over to
(House Speaker Nancy) Pelosi and dropped down to my knees. “Don’t blow
this up,” I pleaded.
Ultimately, Paulson was successful in pushing through the
controversial TARP, which played a key role in averting a second
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Great Depression. Despite criticism for being “bailed out,” finan-
cial and automobile institutions in the end paid back the invest-
ments with interest, enabling the Treasury to earn a profit on its
investment.
Concluding his government service in early 2009, Paulson could
have retired, but that would have gone against his nature. After
writing his memoir, he founded the Paulson Institute at the Univer-
sity of Chicago, funded with his own money, to strengthen relations
between the United States and China. His new book, Dealing with
China, provides unique insights into U.S.-China relationships. An
avid birder, he continues to support the Nature Conservancy, an
organization he chaired in 2004 when it was in crisis.
Few leaders would have had Paulson’s tenacity and courage to
take such bold actions, knowing he would be severely criticized.
History may well credit him with saving the U.S. financial system.
Phase III: Generativity
The last phase of a leader’s journey can be the most rewarding of all.
These days many leaders are foregoing conventional retirement to
share their leadership and wisdom with multiple organizations. They
serve on for-profit or nonprofit boards, mentor young leaders, take up
teaching, or coach leaders. Many of these leaders work across all
three sectors: for-profit, nonprofit, and public service.
InGeeks and Geezers, Warren Bennis described his philosophy of
the third phase of leadership with the little-known term neoteny, “the
retention of all those wonderful qualities we associate with youth:
curiosity, playfulness, eagerness, fearlessness, warmth, energy.”
Undefined by time and age, older people with neoteny are open, willing to take
risks, courageous, hungry for knowledge, and eager for each new day. Neoteny
keeps older people focused on all the marvelous undiscovered things to come,
rather than on past disappointments. Neoteny is a metaphor for all the youthful
gifts the luckiest of us never lose.
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It is a philosophy worthy of consideration throughout our life-
times, but especially in the final third. Let’s look at how some leaders
are using the third phase of their leadership journeys.
Erskine Bowles: Connecting Public Service
and Private Sectors
Few leaders have moved as smoothly from the for-profit arena to the
political and educational domains as has Erskine Bowles. Early in his
career, Bowles built one of the first midmarket investment banks,
which was sold for $300 million. Next he served as President
Clinton’s chief of staff, where he led negotiations to produce the
first balanced federal budget in 40 years. Later he became president of
the 16-institution University of North Carolina system.
Throughout his varied career, Bowles has exemplified authentic
qualities of leadership. “I’m not a visionary,” he said. “I’m about
organization, structure, focus, and timeline.”He uses his strengths to
create high levels of employee engagement, setting high expect-
ations, building teamwork, and ensuring intended outcomes.
In the last five years, Bowles emerged as the leading national
voice on fiscal reform as cochair of President Obama’s National
Commission on Fiscal Responsibility and Reform with Senator Alan
Simpson. Bowles worked closely with Democrats, including Presi-
dent Obama, and Republicans to forge consensus on fiscal recom-
mendations. Meanwhile, he serves on important corporate boards,
such as Facebook, Morgan Stanley, Norfolk Southern, and Belk,
which strengthens his ability to influence public issues. “At 69, I
want to stay relevant to what’s going on in the economy and
continue to learn,” he said.
Michael Bloomberg: Going His Own Way
Mike Bloomberg is a leader who has always gone his own way.
When I knew him in business school, he was so brilliant that he
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didn’t need to study the cases like the rest of us. He tells the story of
getting called on in class when he hadn’t even bothered to glance
at the case.
Called out for not being prepared, I suggested to the professor he should first get
inputs from several students and then I would summarize and draw conclu-
sions. With that, the professor dismissed the entire class and told us to come
back prepared the next day. When he called on me the next day, I offered a
radical solution that he and the rest of the class completely rejected. Years later,
the company did exactly what I suggested and was highly successful.
After graduation, Bloomberg went to work at Salomon Brothers.
He was a rising star and head of equity trading at Wall Street’s
hottest firm 15 years later. When Salomon merged with Phibro, he
was ushered into Chairman John Gutfreund’s office and abruptly
fired. He was surprised and hurt. “There I was, 39 years old,
terminated from the only full-time job I’d ever known and the
high-pressure life I loved. Was I sad? You bet, but as usual, I was
much too macho to show it.”
His firing still gives him something to prove 30 years later. He
decided he no longer wanted to work for someone else, so he used
$4 million of his $10 million termination settlement to found a
company he named Bloomberg. There, he created the Bloomberg
Terminal, still the most ubiquitous tool in the financial industry.
When we were in graduate school, I thought he was one of the
least likely of my classmates to go into politics. Was I wrong about
that. In 2001, he was elected mayor of New York, and became the
most successful big-city mayor in the country. Direct, practical, and
completely unafraid of confrontation, he took on tough issues and
powerful groups, such as teachers’ unions and the National Rifle
Association. During his tenure, he improved K–12 education,
reduced rates of obesity, and controlled guns. Now an independent
after switching political parties twice, many believe he would be an
excellent candidate for president. He says he couldn’t win as an
independent, joking that he’s too short to be president.
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After completing his third term as mayor, Bloomberg intended to
focus on philanthropy and run his foundation, while giving away
his entire $38 billion fortune. Within months, his passion for his
business brought him back as CEO to the firm he founded. An
entrepreneur at heart like Howard Schultz, Bloomberg realized the
call of continuing to build this very successful company.
He told me recently he will continue to focus on the big public-
sector issues: obesity, tobacco cessation, gun control, entrepreneur-
ship, and the environment. He said, “At this stage what do I have to
lose?” adding, “I intend to give it all away. The best financial
planning ends with bouncing the check to the undertaker.” In
Bloomberg’s third phase, he is blending together his philanthropic,
public policy, and business passions to make an enormous difference
in the world.
Exploring Leadership after Phase II
Early in life I adopted the philosophy of an old Schlitz beer
commercial, “You only go around once, and you’ve got to grab for
all the gusto you can.”My goal was to lead a major organization doing
important work, turn it over to my successor, and then move on to
new and equally meaningful opportunities.
When I was elected CEO ofMedtronic in 1991, I told the board I
should not serve more than 10 years, because that was sufficient time
to accomplish the organization’s goals and develop a well-qualified
successor, who turned out to be Art Collins. At the conclusion of my
term, I was 58 and lacked a clear vision of what was next for me. I
spent six months exploring wide-ranging opportunities in govern-
ment, education, health care, and international relations. Each field
was interesting, but none seemed just right.
Meanwhile, I stayed active in the business community by serving
on the boards of Goldman Sachs, Novartis, and Target, and later
ExxonMobil and the Mayo Clinic. Viewing these corporations from
the board’s vantage point has been a superb education into the
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challenges leaders face in such vital industries as financial services,
health care, energy, and retail.
In 2002, Penny and I moved to Switzerland for a “working
sabbatical,” as I had appointments to teach leadership at two out-
standing Swiss institutions. It was quite an adjustment to go from
leading an organization of 26,000 people to being completely on my
own: creating my own courses, developing syllabuses, learning how
to teach—even getting my students to help me create PowerPoint
charts.
I vividly recall my first day in the classroom, when I taught 90
MBAstudents from35 countries. It was a scary feeling to stand in front
of these very bright and demanding students. Talking about Med-
tronic was easy, but leading a case discussion on Intel that engaged all
90 students was a great challenge. I learned I loved teaching and
enjoyed counseling students. Returning fromSwitzerland, I did a four-
month stint at Yale School of Management, then joined the Harvard
Business School (HBS) faculty as professor of management practice.
At Harvard, I taught Leadership and Corporate Accountability and
then created an elective called Authentic Leadership Development,
based on the ideas I wrote about in True North.
Shedding the constant pressures of running a large organization
gave me the opportunity to creatively explore how to develop a new
generation of authentic leaders. At Medtronic, I often had 15 tightly
scheduled meetings per day. As I transitioned to Phase III, I created
room to think deeply. One product was my first book, Authentic
Leadership. Through it, I discovered writing as a means of sharpening
my own ideas and sharing them with others. I have since written five
other books, including this one. My 12 years at HBS have been the
most creative years of my life, replete with opportunities to integrate
all my interests.
As someone who has led many organizations, the irony is that I
have not led anything in the past decade. Instead, I have discovered
a new purpose for my leadership: to develop authentic leaders
following their True North who are dedicated to making a positive
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impact on society. During the past two years, I have focused on
developing global leaders, a topic that is the focal point of
Chapter 12.
Regardless of where you are in your journey—just getting
started, looking for a new challenge, or reaching the top of your
organization—each leadership experience enables you to grow and
to discover your authentic leadership. As Amgen’s Kevin Sharer
said, “You are the mosaic of all your experiences.” Just as you
conclude one portion of your journey, another opportunity emerges,
so you can take what you learned from previous experiences and
apply it to new situations. If you embrace your life story and learn its
lessons, your leadership journey will never end.
Exercise: Your Life Story and Journey
to Authentic Leadership
After reading Chapter 1, it’s important to examine your life story and
leadership opportunities to this point.
1. Looking at patterns from your early life story, what people,
events, and experiences have had the greatest impact on you
and your life?
2. In which experiences did you find the greatest inspiration and
passion for your leadership?
3. Do the failures or disappointments you experienced earlier in
your life constrain you, even today, or have you been able to
reframe them as learning experiences?
4. Do you think you need to make any adjustments to your personal
and leadership development as a result? If so, what are they?
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2
LOSING YOUR WAY
Money is very seductive . . . However much you say
that you will not fall into the trap of it, you do fall
into the trap of it.
—Rajat Gupta, former worldwide managing director, McKinsey
All of us have fears, anxiety, and confusion—these are an integral
part of the human condition. By understanding our life stories, we
begin to recognize and accept these qualities. Howard Schultz fully
embraced his life story, learning respect for all people from his
experience growing up in poverty. He also reframed his negative
image of his father from a poor family provider to someone who
never had the right opportunities. This ultimately motivated Schultz
to build Starbucks into the type of company where people like his
father would be proud to work.
Unfortunately, many leaders do not ground themselves in their
life stories. Instead, they try to bury their past, and put on a new
mask. Or they get caught up in chasing the world’s esteem by trying
to accumulate money, fame, and power, rather than pursuing their
intrinsic motivations. Perhaps they fear vulnerability or lack close
friends who can help them reflect on their experiences.
The consequences of denying or repressing your life stories, your
crucibles, and your fears can be severe. It magnifies your shadow side
that shapes your behavior but operates hidden from view. Many
leaders with great potential lose their way because they do not face
their shadow sides and wind up way off course from their True North.
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The Tragedy of Rajat Gupta
Rajat Gupta was a close professional colleague of mine. We inter-
acted in many professional settings and worked together on three
boards—Goldman Sachs, World Economic Forum USA, and
Harvard Business School (HBS) Board of Dean’s Advisors. Gupta
also served on the boards of Procter & Gamble and American Air-
lines. I considered him one of the world’s most accomplished leaders,
someone who was intelligent and savvy and demonstrated strong
values. He was well connected with many of the world’s most
important people. Heads of state, CEOs, and billionaires all returned
his calls.
At McKinsey, he was the first worldwide managing partner born
outside the United States. He expanded the firm into a global
powerhouse during his nine years at the helm, as McKinsey’s
revenues grew by 280 percent to $3.4 billion. Gupta was a philan-
thropic leader as well. He chaired the Global Fund to Fight AIDS,
Tuberculosis and Malaria. Later he founded the Indian School of
Business and served on an array of nonprofit boards. For the Indian
community he was a role model of the American dream fulfilled, a
symbol that an Indian immigrant could make it to the top in
America.
Rajat Gupta is currently serving a two-year sentence in federal
prison.
He was convicted in 2012 on four criminal counts for providing
inside information to Galleon Fund founder Raj Rajaratnam. He
shared privileged information that he learned at Goldman board
meetings during the fall of 2008, which in turn Rajaratnam used to
make insider trades. After Gupta’s final appeal was turned down by
the U.S. Supreme Court, he entered prison in June 2014.
How could such an exceptional leader at the peak of his success
fall so far, so fast? Although we may never know the full story,
perhaps we can discover some clues through his life story. Gupta was
born in Calcutta, India. His father was a journalist and freedom
fighter who had been jailed by the British when India was fighting for
independence. Young Gupta faced a major crucible in his life when
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he was orphaned as a teenager. His father died when Gupta was 16,
and his mother passed away just two years later. With no money to
live on, he took responsibility for raising his two younger siblings. He
gained admission to the famed Indian Institute of Technology in
Delhi by finishing fifteenth in the nation on the entrance exam.
After graduation, he immigrated to the United States to attend
business school before joining McKinsey in 1973.
We may never know what caused him to cross the line to
provide Rajaratnam inside information. Throughout the trial,
Gupta maintained his innocence, suggesting he was a victim of
Rajaratnam, who had already been convicted on multiple counts of
insider trading and sentenced to 11 years in prison. Some have
asserted it was simply greed, and speculated that Gupta resented
the large sums of money his peers on Wall Street and in Silicon
Valley were making.
Even as he accumulated a net worth of $120 million, he seemed
to have an unquenchable thirst for more. A 2013 article in the New
York Times Magazine speculated, “Teaming up with Rajaratnam
seemed to be his plan for a spectacular career finale—a bid not
only to stay vital after stepping down from McKinsey but also to
establish himself in the elite circle of billionaires.” In his 2005 speech
at Columbia University, Gupta confirmed this weakness, saying,
“When I look at myself, yeah, I am driven by money,” adding:
When I live in this society, you do get fairly materialistic. I am disappointed. I
am probably more materialistic today than I was before. Money is very
seductive. You have to watch out for it, because the more you have it, you
get used to comforts, and big houses and vacation homes and doing whatever
you want. However much you say that you will not fall into the trap of it, you
do fall into the trap of it.
On paper, Gupta had it all. He had talent, having worked his way
up to CEO of the most respected global consultancy. He had wealth
and power. He was a board member of the most respected companies
in the world. He had respect. People admired him and looked up to
him. Apparently, none of this was enough.
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For years, Gupta and I spoke with some frequency, and we sat
together at board meetings. There were no outward signs of his inner
struggle, yet he clearly faced demons that pulled him away from his
True North.While he is paying an enormous price for his actions, his
is not a simple case of greed. My intuition tells me that he was deeply
scarred by his teenage crucible and the poverty that ensued and
never resolved his need for financial security. Most likely, Gupta is a
man who lost his way by not controlling his need for financial
wealth.
Why Leaders Lose Their Way
All of us should ask ourselves, Could this happen to me? Am I
vulnerable to being seduced by money, fame, or power? What
personality weaknesses do I have that might cause me to lose sight
of my True North? Under what circumstances could I fall into
this trap?
Let’s explore what causes people with excellent potential to lose
their way. Why do they often derail just as they are hitting the peak
of their leadership? Can they recover from failures and still become
authentic leaders?
These questions trouble everyone who wants to lead.
People who lose their way are not necessarily bad people. They
have the potential to become good leaders, even great leaders.
However, somewhere along the way, they get pulled off course.
Little by little, bit by bit, they get caught up in their own success. As
leaders are acclaimed by the world and receive the rewards that come
with achievement, they are at the greatest risk of deviating from their
True North.
Leaders whose goal is having power over others, maximizing
their wealth, or becoming famous tend to look to other people for
fulfillment and acknowledgment of their status. In public and
private, they often display a high degree of narcissism. As leaders
of institutions, they ultimately believe the institution cannot survive
without them because in their mind they are the institution.
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Before you take on a leadership role, ask yourself: “What
motivates me to lead this organization?” If the honest answers are
simply power, prestige, and money, you are at risk of being trapped by
external gratification as your source of fulfillment. There is nothing
wrong with desiring these outward symbols if, and only if, they are
balanced by a deeper desire to serve something greater than yourself.
Extrinsic rewards exert a force that can pull you away from True
North if not counterbalanced by a deeper purpose or calling that
gives you a passion to lead.
Let’s take a deeper look at the root causes of leaders losing their
way.
Losing Touch with Reality
Leaders who focus on external gratification instead of inner satis-
faction have trouble staying grounded. They reject the honest critic
who holds up a mirror and speaks the truth. Instead, they surround
themselves with sycophants—supporters telling them what they
want to hear. Over time, they lose perspective and capacity for
honest dialogue, and people learn not to confront them. Late in the
career of CBS’s Bill Paley, people knew that he would kill the
messenger who brought him bad news. Not surprisingly, he got a
filtered view of reality from his subordinates.
Fearing Failure . . .
Underlying these tendencies may be a fear of failure. Many leaders
advance by imposing their will on others. By the time they reach the
top, they may be paranoid that someone is waiting in the wings to
knock them off their pedestal. Underneath their bravado lies the fear
that they are not qualified for such powerful leadership roles, and any
day someone is going to unmask them.
To overcome their fears, some leaders drive so hard for results
that they lose touch with reality and become incapable of acknowl-
edging their failures or weaknesses. When confronted with their
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failures, they may try to cover them up or to create a rationale that
convinces others these problems are not their fault. Often they look
for scapegoats to blame, either within their organization or outside.
By combining power, charisma, and charm, they convince others to
accept these distortions, causing their organizations to lose touch
with reality. In the end, their organizations suffer the greatest harm.
. . . and Craving Success
The other side of the fear of failure is an insatiable craving for
success. Most leaders want to do a good job for their organizations, be
recognized, and rewarded accordingly. When they achieve success,
they receive added power and enjoy the prestige that goes with it.
That success can go to their heads, and they develop a sense of
entitlement. At the height of some leaders’ power, success itself
creates a deep desire to keep it going, so they are prone to pushing the
limits, thinking they can get away with it.
Novartis CEO Daniel Vasella described this process in a Fortune
magazine interview:
Once you get under the domination of making the quarter—even
unwittingly . . . you’ll begin to sacrifice things that may be vital for your
company over the long term. The culprit that drives this cycle isn’t the fear of
failure so much as it is the craving for success . . . For many of us the idea of
being successful is intoxicating. It is a pattern of celebration leading to belief,
leading to distortion. When you achieve good results, you are celebrated, and
you begin to believe that the figure at the center of all that champagne toasting is
yourself. You are idealized by the outside world, and there is a natural tendency
to believe what is written is true.
The Loneliness Within
It is lonely at the top. Leaders know they are ultimately responsible
for their company’s performance, and the well-being of many rests in
their hands. If they fail, many people will be harmed. To ignore
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mounting pressures, some leaders simply run faster. Whom can they
share their worries with? It can be difficult to talk with subordinates
or their boards about their biggest problems and deepest fears.
Friends outside the organization may not understand their chal-
lenges. Sharing their doubts openly may set off rumors. Sometimes it
is even difficult to share these concerns with spouses or mentors.
Because of this loneliness, many leaders deny their fears. They
shut down their inner voice because it is too uncomfortable to hear.
Instead, they try to respond to the external voices pressuring them,
thinking all will be well if they can satisfy them. Because the advice
of outsiders is often conflicting or too painful to face, some leaders
choose to listen only to people who reinforce their views. As Apple
founder Steve Jobs advised, “Don’t let the noise of others’ opinions
drown out your own inner voice.”
Meanwhile, leaders’ work lives and personal lives grow more
unbalanced. Fearing failure, they favor their work life, even saying,
“My work is my life.” Eventually, they lose touch with those closest
to them—their spouses, children, and best friends—or they co-opt
them to their point of view. Over time, little mistakes turn into
major ones. No amount of hard work can correct them. Instead of
seeking wise counsel at this point, they dig a deeper hole. When the
collapse comes, there is no avoiding it.
Who are they? They could be one of those executives facing
prosecution for their actions. Or a CEO forced to resign for personal
reasons. But they could also be you, me, or any one of us. We may not
face a plight as severe as these leaders face, but we can all lose
our way.
Derailing: Losing Sight of Your True North
In observing leaders who have derailed, we identified five types who
lose sight of their True North. Their shortcomings link directly to
the failure to develop themselves: Imposters, who lack self-awareness
and self-esteem; Rationalizers, who deviate from their values; Glory
Seekers, who are motivated by seeking the world’s acclaim; Loners,
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who fail to build personal support structures; and Shooting Stars, who
lack the grounding of an integrated life.
Can you see yourself in any of the following archetypes? Could
these characteristics cause you to derail?
Imposters
Imposters rise through the organizational ranks with a combination
of cunning and aggression. They understand the politics of getting
ahead and let no one stand in their way. They are often unabashed
students of Machiavelli, determining every angle to advance as they
execute their game plan. They are the ultimate political animals,
adept at figuring out who their competitors are and then eliminating
them one by one. They have little appetite for self-refection or
developing self-awareness.
Abraham Lincoln once said, “If you want to test a man’s
character, give him power.” Having acquired power, Imposters
may not be confident about how to use it. They are beset with
doubts about the responsibilities of leadership. Because their greatest
strength is besting internal opponents, they are often paranoid that
underlings are out to get them.
Richard Grasso’s Fall from Grace
A tragic example of an Impostor was Richard Grasso in his closing
days as CEO of the New York Stock Exchange (NYSE). Grasso,
who never went to college, started at the exchange earning $80 per
week as a clerk. He rose to the top of one of the world’s most
powerful institutions by building strong relationships with every-
one engaged with the exchange. He was also not someone to be
crossed, because he had ways to get revenge. Grasso was bitter
when he was passed over for CEO in favor of Bill Donaldson, an
establishment candidate who came from investment banking. “I’m
going to keep my mouth shut,” Grasso confided to a friend, “and
when the time comes, I’m going to take his job.”
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When Donaldson retired in 1995, Grasso was the obvious choice
for CEO. Yet beneath his charm, he seemed to carry deep feelings of
resentment for having been unfairly treated over the years and a
wariness of the investment bankers on his board, many of whom had
attended Ivy League schools. With the success of the NYSE, he felt
entitled to earn as much as his board members without having the
risks of their businesses.
When two airplanes flew into the World Trade Center’s twin
towers onSeptember 11, 2001,Grasso immediately steppedup, getting
the NYSE back online by September 17, much sooner than anyone
believed was possible. He instantly became a symbol of America’s
courage in the face of tragedy. For his actions he was handsomely
rewarded by his board’s compensation committee, an order of magni-
tude greater than other regulators or government officials.
Two years later, Grasso was forced to resign by his board in a
13–7 split vote. What happened? It seems he got so caught up in his
power and celebrity that he lost touch with the public’s negative
reaction to a regulator receiving a $140 million compensation
package. Yet Grasso could justifiably argue that he had only accepted
the compensation the board awarded him. Sadly, America lost a
highly competent government official in a messy departure at a time
when the country sorely needed great public leaders.
Rationalizers
To people outside their organizations, Rationalizers always appear on
top of the issues. When things don’t go their way, they blame
external forces or subordinates. Masters of denial, they rarely take
responsibility themselves. As they advance and face greater chal-
lenges, they transmit pressure to their subordinates instead of
modulating it. When pressuring subordinates fails to produce the
numbers, they cut funding for research, growth initiatives, or
organization-building to hit financial expectations. Eventually, these
short-term actions catch up with them. Then they borrow from the
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future to make today’s numbers look good, or stretch accounting
rules, rationalizing that they can make up the deficit in the future.
Unfortunately, their actions only make the future worse. So they
turn to more aggressive schemes, such as reporting future revenue
streams in quarterly sales or filling customer warehouses with inven-
tory. When these short-term actions fail to stem the tide, they resort
to even more desperate measures. Ultimately, they become victims
of their rationalizations, as do their depleted organizations.
The misdeeds of Rationalizers have become all too apparent in
recent years. Pressures from shareholders caused many executives to
play the game of meeting stock market expectations while sacrificing
the long-term value of their companies. Even years later, many
Rationalizers cling to denial, unwilling to take responsibility for
problems they caused. As Warren Bennis said, “Denial and projec-
tion are the enemies of reality.”
The Collapse of Mike Baker
Mike Baker joined Medtronic in 1989, the same year I did. A
graduate of West Point, he served five years in the military, worked
in the banking industry, and received his MBA from the University
of Chicago. In his eight years at Medtronic, he progressed rapidly
through staff roles into line positions. My colleagues and I saw him as
someone who had the potential to become CEO one day. He was a
superb leader who was intelligent and had solid values. In 1997, he
had his first unsuccessful assignment and was moved to a new
position. Much to my dismay, that triggered his decision to leave
the company.
In 1999, he became chief executive of the fledgling orthopedic
company Arthrocare. Under Baker’s leadership, Arthrocare
achieved great success for nine years, as revenues and profits grew
rapidly and its stock price skyrocketed. Baker was viewed as a rising
star in the medical technology industry. On July 21, 2008, it all blew
up. Arthrocare’s auditors announced a restatement of its revenues
and earnings for the prior seven quarters, dating back to 2006,
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acknowledging the company recognized revenues inappropriately.
This was far more than a technical audit adjustment. Arthrocare’s
stock price dropped 40 percent, causing shareholders losses of
$758 million.
In the trial that ensued, Baker and chief financial officer (CFO)
Michael Gluk were charged with inflating sales and earnings
through end-of-quarter transactions from 2005 to 2009. In June
2014, a court found them guilty of fraud and of lying under oath to
the Securities and Exchange Commission (SEC) and the court.
Two months later, Baker was sentenced to 20 years in prison. He
and Gluk had to repay $22 million in compensation they had
received.
Baker’s case still gnaws at me. Here is a seemingly high-caliber
leader with deeply held values and a solid family life who will spend
much of his life in jail. How could this have happened? Ironically, in
his 2006 True North interview, he spoke of the importance of
learning from failure. “I’m suspicious of somebody who’s never
failed, because you don’t know how they’re going to react when
they do,” he said. “Everyone is born to fail. Everyone is going to
break down. What matters is not how often you have been on the
canvas, but whether you get up, how you get up, and what you learn
from it.”
I suspect that Mike Baker got too caught up in his success. Maybe
he started to define himself by his net worth instead of his self-worth.
This contortion led him to rationalize these inappropriate account-
ing practices in order not to acknowledge publicly that revenue
growth wasn’t there, which would have triggered a sharp drop in
Arthrocare’s stock price and Baker’s wealth. So he kept the scheme
going until it blew up in 2009. He is paying an enormous price for his
misdeeds, from which he may never recover.
Knowing Baker as I did, I can’t see him simply as greedy or evil,
but rather a leader who lost his way. I feel sorry for him but
acknowledge we all must be held to account under the law. This
could happen to any one of us if we rationalize our mistakes rather
than openly acknowledge them and accept the consequences.
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Glory Seekers
Glory Seekers define themselves by the acclaim of the external
world. Money, fame, and power are their goals. Often it seems more
important to appear on lists of the most powerful business leaders
than it does to build organizations of lasting value. Glory Seekers’
thirst for fame is unquenchable. No achievement is sufficient
because there are always people with more money, more accolades,
and more power. Inside, Glory Seekers feel empty and envy those
who have more. Outsiders struggle to understand this emptiness
because Glory Seekers seem to have it all.
Lance Armstrong’s Ruthless Quest for Glory
Lance Armstrong captivated the world with his cycling successes. He
called his story of surviving cancer and winning the Tour de France
seven times a “miracle.” The U.S. Olympic Committee named him
Sportsman of the Year four separate times. Armstrong’s renown
transcended sport, as he became a best-selling author and motiva-
tional speaker, and launched one of the most successful charities of
its time, the Livestrong Foundation.
Yet in January of 2013, he confessed to Oprah Winfrey that he
had cheated for 20 years. He told her, “This story was so perfect for
so long. It’s this mythic perfect story, and it wasn’t true.” Arm-
strong admitted to using performance-enhancing drugs and banned
substances. He told Winfrey he tried to control every outcome of
his life.
I was always a fighter. When I was diagnosed and being treated, I said, “I will
do anything to survive.”And that’s good. I took that attitude—that ruthless and
relentless and win-at-all-costs attitude right into cycling. And that’s bad.
We now know Armstrong led a systematic doping program and
repeatedly lied about it. He ruthlessly attacked people, such as Tour
de France winner Greg LeMond, who questioned his performance.
Before his fall, I met Armstrong as we cycled together in a fun
outing. Looking back, I see that he had positive qualities and made
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important humanitarian contributions. Yet his need for recognition,
money, and success overtook his sense of morality and ethics. His
extreme focus on winning contributed to his competitive success,
but it also undermined his character. In his own words he was “a guy
who . . . truly believed he was invincible.” As it turns out, he was
not—nor is any of the rest of us.
Loners
Loners avoid forming close relationships, seeking out mentors, or
creating support networks. They believe they can and must make it
on their own. Not to be confused with introverts, Loners often have
myriad superficial friends and acolytes but do not actually listen to
them. They reject honest feedback, even from those who care about
them.
Without wise counsel, Loners are prone to make major mistakes.
When results elude them and criticism of their leadership grows,
they circle the wagons. They become rigid in pursuing their objec-
tives, not recognizing their behavior makes it impossible for them to
reach their goals. Meanwhile, their organizations unravel.
Richard Fuld Leads Lehman into Bankruptcy
This is precisely what happened to Richard Fuld Jr. as CEO of
Lehman Brothers. From March to September 2008, close associates
inside and outside the company warned Fuld that the firm was
overleveraged, lacked liquidity, and was inadequately capitalized,
making it vulnerable to volatility in the market. Treasury Secretary
Hank Paulson had nearly 50 discussions with Fuld in that period,
telling him Lehman had “to recognize its losses, raise equity and
strengthen its liquidity positions.” In his book Paulson wrote, “My
conversations with Dick were becoming very frustrating. Although I
pressed him to accept reality and operate with a greater sense of
urgency, I was beginning to suspect that despite my blunt style, I
wasn’t getting through.”
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As Lehman teetered on the brink of bankruptcy, Paulson called
the heads of all the big investment banks to a meeting on Friday,
September 12, 2008, to address the implications of Lehman’s
pending bankruptcy. Fuld was not present, choosing to stay in his
office behind closed doors, perhaps hoping for a government bailout.
He was still waiting at 8 PM on Sunday evening when SEC
Commissioner Chris Cox called to tell him again there would be
no bailout. In the early hours of September 15, Lehman filed for
bankruptcy, putting Fuld and most of his employees out of work,
making their Lehman stock worthless, and triggering the greatest
financial crisis since the Great Depression.
Shooting Stars
The lives of Shooting Stars center entirely on their careers. To
observers, these individuals are perpetual motion machines, always
on the go, traveling incessantly to get ahead. They rarely make time
for family, friendships, their communities, or even themselves.
Much-needed sleep and exercise routines are expendable. As they
run ever faster, their stress mounts.
They move up so rapidly in their careers that they never have
time to learn from their mistakes. A year or two into any job, they are
ready to move on, before they have had to confront the results of
their decisions. When they see problems of their making coming
back to haunt them, their anxiety rises, and so does the urgency to
move to a new position. If their employer doesn’t promote them,
they are off to another organization. One day they find themselves at
the top, overwhelmed by an intractable set of problems. At this
point, they are prone to irrational decisions.
A Tale of Two Tech Entrepreneurs
In Silicon Valley, where momentum is a currency to venture
capitalists, entrepreneurs can focus too much on managing impres-
sions instead of managing their businesses.
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During the past decade, YouSendIt, a Silicon Valley–based
software company, raised multiple rounds of venture capital along-
side other file-sharing companies, such as Dropbox and Box.com.
CEO Brad Garlinghouse was a darling of the media. He shared his
ideas for building culture and talked at length about the impact of
the cloud on the economy. He even rebranded the company High-
tail, explaining to Fortune, “We wanted to choose a name that
captured this larger vision of where the world was going.” Hightail
always sought quick wins, public relations, and easy solutions—at
least until it ran low on cash. Garlinghouse departed in 2014, and
the incoming CEO immediately fired half the company’s workforce
in an effort to restore profitability.
Contrast Hightail with ShareFile, a company started two years
later by Raleigh-based entrepreneur Jes Lipson, who made sustain-
able growth one of ShareFile’s core values. Without relying on
venture capital funds, he built the company to profitability with 85
employees and sold it to Citrix for $93 million. Following the
acquisition, he grew the ShareFile business to 600 employees. Today
ShareFile has eclipsed Hightail, the former market leader that had
raised $83 million from venture capitalists. Lipson said, “I didn’t
focus on media coverage, investors, or the analysts. I just listened to
what customers wanted.”
Lipson and his wife, also an entrepreneur, both served as
president of their local Entrepreneur’s Organization chapter.
Together, they created a 15,000-square-foot incubator called HQ
Raleigh, where the next generation of entrepreneurs can launch
their ideas. The entrepreneur-turned-corporate executive no longer
needs to work for money, but he’s as committed as ever—motivated
by his company’s mission and continuing to serve.
Heroes of Their Own Journeys
All five archetypal leaders described here—Imposters, Rationalizers,
Glory Seekers, Loners, and Shooting Stars—frame their life stories
in the model of an all-conquering hero. This approach may work
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well for musicians, actors, or athletes who excel as solo performers. It
fails utterly when one leads a team, however, precisely because being
a hero is not empowering to teammates or subordinates.
The role of leaders is not to get other people to follow them but to
empower other people to lead. They cannot elicit the best perform-
ance from their teams if they are in the game primarily for them-
selves. In the end, poor leaders’ self-centeredness keeps other people
from leading. Why should others try to excel when their efforts are
for the leader’s glory and not the team’s success?
Before going on to Chapter 3, think carefully about whether you
see yourself in any of the five archetypes of leaders who lose their way
and become derailed by challenging yourself in the exercise below.
Exercise: Why Leaders Lose Their Way
1. Have you seen leaders lose their way or worked with someone
who fits any of the archetypes? Which of the qualities of the five
archetypes do you see in yourself?
2. Can you envision a situation in which you could lose your way in
the future?
3. Do you have a fear of failing? Do you fear what other people
would think about you if you did? Are you avoiding situations in
which there is a risk of failing? How could the experience of
failing help you achieve your ultimate goals?
4. In what ways do you crave success? How is this affecting your
decisions about leadership and your career? Do you choose only
situations that give you a high probability of success?
5. What steps can you take to prevent being derailed during your
career?
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3
CRUCIBLES
The crucible is an essential element in the process of
becoming a leader.
—Warren Bennis, On Becoming a Leader
Most of the leaders we interviewedwere shaped by severe trials in their
lives, which we call crucibles. Psychologist Abraham Maslow found
that tragedy and trauma were the most important human learning
experiences leading to self-actualization. Crucibles enable people to
learn life is uncertain, and they have limited control. This new reality
empowers individuals to challenge old assumptions and understand
they must demonstrate personal agency to deal with their world.
Crucibles often launch leaders into despair, crisis, and doubt. In
the midst of a crucible, pain and suffering may overwhelm leaders.
With sufficient resilience, leaders emerge from despair and become
open to introspection that can catalyze major breakthroughs in their
development.
Daniel Vasella’s Long Journey
Novartis chairman and CEO Daniel Vasella followed a path to
leadership that was one of the most difficult and unusual of all our
interviewees. Vasella’s emergence from extreme challenges in his
youth to reach the pinnacle of the global pharmaceutical industry
vividly illustrates the transformation many leaders undergo on
their journeys.
Vasella was born in 1953 to a modest family in Fribourg,
Switzerland. His early years were filled with medical problems
that stoked his passion to become a physician. Suffering from
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asthma at age 5, he was sent alone to the mountains of eastern
Switzerland for two summers. There he lived on a farm with three
brothers and their niece.
At age 8, he had tuberculosis followed by meningitis and spent
a full year in a sanatorium. He suffered not only from illness but
also from isolation. His parents never visited him that year, and
his two sisters came only once. Young Vasella was lonely and
homesick. He still remembers the pain and fear of the lumbar
punctures as the nurses held him down “like an animal” so that he
couldn’t move.
One day a new physician arrived and took time to explain each
step of the procedure to the 8-year-old. Rather than being held
down, Vasella asked the physician whether he could hold the nurse’s
hand. “This time the procedure didn’t hurt, so I reached up and gave
him a big hug,” Vasella recalled. “These human gestures of forgive-
ness, caring, and compassion made a deep impression on the kind of
person I wanted to become.”
Even after Vasella recovered, his life did not stabilize. When he
was 10, his older sister passed away from cancer. The following year,
his other sister died in an automobile accident. Two years later, his
father died in surgery. To support the family, his mother went to
work in a distant town and came home only once every three weeks.
Left alone, 14-year-old Vasella rebelled and joined a motorcycle
gang that drank a lot and got into frequent fights. This lasted for
several years until he met his first girlfriend, whose affection changed
his attitude.
At 20, Vasella entered medical school at the University of
Fribourg. “I decided to become a physician so I could understand
health, and gain more control over my own life after disease had
impacted my family so much,” he explained. “The compassionate
physician at the sanatorium became the role model for the kind of
doctor I wanted to be.”
During medical school, Vasella sought out psychoanalysis so that
he could come to terms with his early experiences. “I wanted to
understand myself and not feel like a victim,” he said. “I learned I did
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not have to be in control all the time.”Graduating with honors from
medical school, Vasella did his residency at the Universities of Bern
and Zürich, eventually becoming chief resident.
It was during this time that Vasella realized he wanted to
affect the lives of many more people by running an organization
that restored people to health. Completing his residency, he
applied to become chief physician at the University Hospital
Zürich and was disappointed when the search committee con-
sidered him too young for the position. So he talked to his wife’s
uncle, Marc Moret, who was CEO of Sandoz, one of Switzerland’s
leading chemical and pharmaceutical companies, about his inter-
est in getting into business. Moret advised him, “Believe me,
I know how unpleasant it can be leading a firm. You don’t want to
go into business.”
Moret’s discouraging words only piqued Vasella’s interest. Even-
tually he was offered a sales position in Sandoz’s U.S. affiliate
and later a product manager role. Vasella hesitated, but his wife,
Anne-Laurence, told him, “Daniel, do it. Otherwise, you will turn
50, look back in regret, and be unhappy.” He flourished in his five
years in America, advancing rapidly through the Sandoz marketing
organization.
Returning to Switzerland as assistant to the COO of Sandoz’s
pharmaceutical business, Vasella was forced to take a step back.
Frustrated, he languished without responsibilities in a cubicle outside
his boss’s office. “My pay was cut by 40 percent, and I wrote minutes
and did my boss’s mail.”
Soon he was asked to lead a team to redesign the research and
development process, giving him intimate knowledge of drug dis-
covery and development. He was promoted to head of marketing
and then global drug development. When both his bosses left in a
political battle, he became CEO of the pharmaceutical division.
Vasella loved his new position because he had full responsibility for
moving the business forward.
Within two years, he got involved with negotiations to merge
Sandoz with Ciba-Geigy, its crosstown rival in Basel. It was a natural
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fit, facilitated because neither company had a successor to its
powerful CEO. In spite of Vasella’s youth, Moret nominated him
to be CEO of the merged companies, to be called Novartis. Ciba-
Geigy leadership agreed, as its CEO became board chairman.
As CEO, Vasella blossomed as a leader. He envisioned building a
great global health care company that could help people by creating
lifesaving drugs. Drawing on the physician role models of his youth, he
created an entirely new Novartis culture built on compassion, compe-
tence, and competition. He used the integration of the two companies
to empower new leaders throughout the new organization.
One success came from the drug Gleevec, which Vasella found
languishing in Novartis’s research labs. Stunned by positive results
in preliminary clinical trials in patients with chronic myelogenous
leukemia, Vasella was upset to learn the drug was given low priority
because of modest market projections. He convinced his team to
get the drug to market within two years, breaking all records for
U.S. Food and Drug Administration approval. Characteristic of his
passion for helping patients, Vasella had personal contact with
many Gleevec users.
Gleevec is just one of a continuing stream of lifesaving drugs
emerging from Novartis research labs. Vasella’s commitment to
improving patients’ lives motivated decisions to expand the com-
pany’s research budget and move its research headquarters to
Massachusetts. These decisions established Novartis as a global
health care giant and Vasella as a compassionate leader in the
industry. Today Novartis has a pipeline full of new, lifesaving drugs
emerging from its research labs.
Vasella said his greatest satisfaction comes when his organization
is fulfilling its mission.
My childhood illnesses, the deaths of my father and my sisters, and the
experience of patients dying all had a powerful impact on my life. As
CEO, I have the leverage to impact the lives of many more people and do
what is right, based on my moral compass. Ultimately, the only thing that
matters is what we do for other people.
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Crucibles of Leadership
Arthur Miller popularized the term crucible in his 1953 play, The
Crucible, about the Salem Witch Trials, in which John Procter’s
fidelity to his beliefs is tested by the threat of being hanged for
practicing witchcraft.
Crucibles will test us to our limits, just as Vasella’s life-threat-
ening diseases did. All of us have had crucibles, whether they were as
painful as Vasella’s or as basic as being rejected by our social group in
high school. These experiences affect our lives and our self-percep-
tions. Warren Bennis discussed crucibles in On Becoming a Leader.
“The crucible is an essential element in the process of becoming a
leader,” he wrote.
Some magic takes place in the crucible of leadership, whether a transformational
experience like Mandela’s years in prison, or a relatively painless experience
such as being mentored. Whatever is thrown at them, leaders emerge from their
crucibles stronger and unbroken.
Crucibles may come early in your life, such as the death of a loved
one, illness, divorce of your parents, growing up in poverty, discrimi-
nation, rejection by peers, or early failures. Left unaddressed, they can
leave you feeling like a victim or even become incapacitating.
Unresolved anger, grief, or shame may cause you to deny your
experiences, shut down your deepest feelings, avoid pain in confront-
ing difficult issues, or experience difficulties in intimate relationships.
Later in life, crucibles can be triggered by events such as difficult
situations at work, critical feedback, or loss of your job. Or they may
result from painful personal experiences, such as divorce, illness, or
the death of a loved one. Quite often, crucibles occur when you least
expect them. As my wife, Penny, explained about her breast cancer
diagnosis in 1996, “Life is what happens when you’re expecting
something else.”
It is hardest to cope with crucibles when you’re in the midst of
them, as you may feel so much pain that you cannot see the lessons
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that come from the experience. To navigate through a crucible, you
need to believe in yourself and your purpose in life and summon the
inner strength and courage to endure. These difficult times also
require the affirmation and support of those closest to you.
No one goes through life without experiencing severe chal-
lenges. Some are dramatic and life changing whereas others seem
insignificant until you reflect on the influence they have had in your
life. Crucibles are the real test of your character and can be
transformative experiences that empower you to reframe your life’s
meaning. Eventually, you will look back at your experiences and
draw strength from them.
Oprah Winfrey: Reframing Her Story at 36
When she was 36, Oprah Winfrey interviewed a woman named
Truddi Chase, who had been sexually abused as a child. Hearing
Chase’s story, Winfrey was overcome with emotion. “I thought I was
going to have a breakdown on television. And I said, ‘Stop! Stop!
You’ve got to stop rolling cameras!’” But the cameras kept rolling as
feelings roiled inside her.
Chase’s story triggered many traumatic memories fromWinfrey’s
own childhood. “I think it was on that day that, for the first time, I
recognized that I was not to blame,” she said. Her demons had
haunted her without explanation to that point of her life.
I became a sexually promiscuous teenager and as a result of that got myself into
a lot of trouble, and believed that I was responsible for it. It wasn’t until I was
36 years old, 36 that I connected the fact, “Oh, that’s why I was that way.”
I always blamed myself.
Born out of wedlock, Winfrey grew up in poverty in rural
Mississippi. When she was very young, her mother moved north
to find work. “I came to live with my grandmother . . . It actually
probably saved my life,” she said. Yet even as a young child, she had a
vision that she could make something of her life. She recalled
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standing outside on the back porch when she was four, watching her
grandmother boiling the laundry in a large cauldron. “I remember
thinking, ‘My life won’t be like this. It will be better,’” she said. “It
wasn’t from arrogance. It was just a place of knowing that things
could be different for me somehow.”
Winfrey credited her grandmother for teaching her to read.
“That opened the door to all kinds of possibilities for
me . . . I loved books so much as a child. They were my outlet
to the world.” She recited biblical verses in church from age three,
which endowed her with a reservoir of self-confidence.
All the sisters sitting in the front row would fan themselves and turn to my
grandmother and say, “Hattie Mae, this child is gifted.” And I heard that
enough that I started to believe it . . . I didn’t even know what “gifted”meant.
I just thought it meant I was special.
Winfrey recalled the trauma of being raped by her cousin after
she relocated to Milwaukee to be with her mother when she was
nine. She was molested several more times by family members and a
family friend during the five years she lived with her mother. “It was
an ongoing, continuous thing. So much so, that I started to think,
‘This is the way life is.’” At age 14, she gave birth prematurely to a
child who lived only two weeks.
Winfrey started out trying to make it in the world as an
individual contributor. She went to college and had her first
opportunity in broadcasting. “It was very uncomfortable for me
at first . . . pretending to be Barbara Walters, looking nothing
like her.” She said she had to take the heat from her college
classmates, who called her a token. “I used to say, ‘Yeah, but I’m a
paid token.’ ”
Today Winfrey has built a media empire that is one of the most
respected in the world, but not until the Truddi Chase interview did
she realize her broader mission. Ever since the traumatic experiences
of her youth, she had felt the need to please people and could never
say no. That day she finally understood why.
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Since then, her mission has gone far beyond pursuing personal
success to empowering people all around the world, especially
young women.
I was . . . always searching for love and affection and attention, and somebody
to say, to look at me and say, ‘Yes, you are worthy.’ . . . And that, to me, has
been the greatest lesson of my life: is to recognize that I am solely responsible for it,
and not . . . living to please other people, but doing what my heart says.
Asked about her show’s theme, Winfrey replied, “The message
has always been the same: You are responsible for your life. I hope my
show and my speeches can help young people get the lesson sooner
than I did.”
Like many others, I saw Winfrey as a celebrity and missed her
greater calling. As we spoke for three hours at the Nobel Peace Prize
dinner in Oslo, Norway, I realized the real impact of her leadership and
its effect on the lives of her viewers. She described howpassionate she is
about influencing millions of people and emboldening them to take
responsibility for their lives. From Oslo, Winfrey was on her way to
Africa with a planeload of books and supplies to launch a new school to
empower youngwomen,where shehas personally invested$30million.
Although perhaps not as dramatic as Winfrey’s or Vasella’s
experiences, all of us encounter crucibles in our lives. It is naive
to think that you can go through life without difficulties, or spend
your entire life trying to avoid them. Life is not always fair. The
important thing is how you frame and use your crucibles.
Given the abuse and poverty she experienced earlier in her life, it
would have been easy for Winfrey to feel like a victim. Yet she rose
above her difficulties by reframing her story in positive terms: first by
taking responsibility for her life, then in recognizing her mission to
empower others to take responsibility for theirs. Her transformation
did not occur until her midthirties. Often the gestation period takes
that long becauseweneed to gain real experiences to help us seewhere
we fit in the world and help us understand the meaning of difficult
times inour personalmissions.That’swhathappened toPedroAlgorta.
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Pedro Algorta: Turning Wounds into Pearls
Shortly after True North was published in 2007, I received this
amazing letter:
Dear Bill,
35 years ago, I lived an extreme life experience. The plane I was flying
with other 45 friends crashed over the Andes Mountains. 72 days later, after
surviving in the mountains at 14,000 feet without food or clothing and no
preparation, and even going into cannibalism to feed ourselves, 16 of us were
finally rescued.
During this ordeal, I had a clear True North: it was to survive one more
day, each day. I also found out that we are not strange people, and there were
no heroes. The ones that survived were no better than the ones that died.
Almost any person in our place, given similar conditions, would have done
the same.
For 35 years this has not been an issue for me. I even went through my
MBA at Stanford without saying a word about my ordeal. Now, I am starting
to think about it, and to relate it to my business career. I am reading True
North and would like to share my experience with you. That might help me
draw more learnings that might help others in their careers.
Cordially,
Pedro Algorta
After receiving Algorta’s letter, I invited him to share his
experience with my MBA class. His story and the pictures he
showed mesmerized the students. He returned to my class in
2013, having had five more years to process his crucible, and
described three ways to deal with crucibles:
• Focus on the event, and live your life looking backward, often an
angry life of blaming others.
• Live your life as if nothing happened, while the memories and
the pain remain deep inside you.
• Use the event to transform your wound into a pearl.
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He shared the metaphor of the oyster pearl: When sand grates
against the oyster shell, its natural reaction is to cover up the irritant
to protect itself with a substance called nacre (mother-of-pearl),
which eventually forms the pearl itself. Are you turning your wounds
into pearls? To do so, you will have to process your crucible, discern
its meaning, and reframe it as an opportunity for personal growth.
Taylor Carol: Terminal Cancer Survivor
When you meet Taylor Carol, he seems like the All-American
college student: ingenuous, hardworking, engaged in sports, and
popular. Then he tells his story of being diagnosed with terminal
cancer at age 11.
Taylor was a typical 11-year-old boy when he was hit by a pitch
in a baseball game. But his injury did not heal, and at the same time
he was feeling lethargic. Concerned about his condition, his parents
took him to a hospital near his home in Orange Country, California,
for blood tests. When his white cell counts came back off the charts,
his parents raced him to the Children’s Hospital of Orange County.
After several days of tests, the results were stark. Taylor had a rare
form of leukemia that does not respond to normal treatment. Taylor
and his parents were told he had only two weeks to live.
Not willing to accept that diagnosis, his parents moved to Seattle
so that he could be treated at Seattle Children’s Hospital under the
care of Dr. Brian Drucker, inventor of the Novartis drug Gleevec,
and Dr. Paul Carpenter, leading specialist in graft-versus-host disease
at the Fred Hutchinson Cancer Research Center. The next two years
of Taylor’s life were as difficult as anyone can imagine: bone marrow
transplant from a 27-year-old German donor; struggling with graft-
versus-host disease; weeks in complete isolation; inability to eat,
walk, or speak for extended periods; and severe pain treated with
extreme painkillers.
The most difficult of all was watching his best friend, Christian,
die after two years. As Taylor describes his feelings at that time, “I
was broken by Christian’s death. Why did he die and I lived? I was
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furious with God for letting Christian die. I was lost.” But Taylor
learned that using his voice and singing brought him back. He wrote
a song with Matthew Messina called “True Courage” that he sang at
the one hundredth anniversary of Seattle Children’s.
Over time, Taylor recovered and his body returned to normal,
but by then, he had missed four years of school. His counselors
suggested that he skip high school and get a graduate equivalent
degree. Instead, Taylor decided he wanted to go to Harvard
College, knowing nothing about the school except its name.
With this as his goal, he made up for lost time, was admitted,
and is currently an engaged, successful student. Today he is a
national spokesperson for the Leukemia & Lymphoma Society,
traveling the country to raise funds for cancer research by singing
and speaking.
How did his battle with terminal cancer affect his life?
Taylor said:
After beating cancer, I resolved to use my singing, my words, and every ounce
of [my] life force to glorify God and help beat this horrific illness. Over the past
seven years I’ve been lucky enough to help raise over $10,000,000 in these
pursuits, but I know it’s only the beginning. I aspire to change the world with
my words and voice by pursuing my career as a singer/songwriter.
Taylor has dealt with his incredible crucible by transforming
his wound into a pearl, using it as an opportunity for post-
traumatic growth.
Post-Traumatic Growth
If you follow either of the first two approaches Algorta described—
being angry about your crucible or burying it—you may experience
post-traumatic stress disorder (PTSD). With PTSD, the traumatic
event is commonly relived through recurrent recollections, night-
mares, and flashbacks. Many people refuse to address or even
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acknowledge their crucible, saying, “That’s in the past; I don’t want
to dig it up.” The problem is that you cannot bury your crucible,
because the memories are always with you. If you avoid all thoughts
and discussions about it, as Algorta did, you may find yourself
reliving your crucible in a different form later in life or avoiding
highly stressful situations that incapacitate you.
New research shows that traumatic experiences can result in
post-traumatic growth (PTG) as often as PTSD. Similar to Algo-
rta’s metaphor of the oyster pearl, PTG starts by recognizing the
uncertainties in life and embracing them as fundamental tenets of
human existence. It also requires self-awareness and a desire to
undertake personal change. Finally, PTG requires acknowledging
your personal responsibility for the choices you make in life.
Nick Craig, founder of the Authentic Leadership Institute,
describes the path to PTG in his classes on crucibles. He encour-
ages participants to move from seeing themselves as victims to
seeing themselves as survivors, then using their learning to elevate
themselves into thrivers.
Let’s look at some examples of leaders who pursued post-trau-
matic growth.
Philip McCrea: Learning from Failure
For his first 35 years, charming and likeable Philip McCrea had a
great life: wonderful family, lots of friends, and success in school,
sports, and work. In high school, he garnered the name “Mr.
Perfect,” a teasing reference to the sense that he always had things
going his way. In his early thirties, he founded Vitesse Learning, a
spin-off from his former company, C3I, to focus on automated
software education for pharmaceutical companies. Its sales crossed
the $10 million mark, but profit margins were razor thin.
Although many leaders have a deep-seated fear of failure, the
irony is they learn the most from their failures. Asked in 2004 if
he had ever failed, McCrea replied, “Certainly, I have not faced
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disaster. I haven’t had a company that’s blown up, or been termi-
nated for not performing.” He added:
However, I need to move from being “ever the optimist” to become more of a
realist and look at a balanced picture of each decision as opposed to the rosy
picture. I get too aggressive in making decisions about the results we will
achieve, and tend to absorb challenges, believing I can work through any issue
on my own. I need to realize I don’t have the answers, and have discussions
with others to help me get there.
Because McCrea’s family and friends funded Vitesse, it was often
short of capital, especially when the business experienced cost over-
runs in software development. In the fall of 2005, McCrea realized
Vitesse had run out of funding resources, so he merged with a
Canadian firm that promised 35 percent lower software development
costs.McCrea retained 30 percent ownership of themerged company.
The merger did not go well. Costs rose instead of declining while
client relationships deteriorated. After the owner of the Canadian
firm rebuffed him, McCrea realized the problems were not going to
be resolved and resigned in 2006. Six months later, the firm declared
bankruptcy and McCrea’s equity was worthless. He explained:
This was the first time I experienced significant personal failure. It led to my
greatest growth, as I had to look myself in the mirror and accept personally that I
had failed. I learned people still loved me, and lots of business opportunities and
dreams were still achievable.
McCrea also described the impact his professional problems had on
his marriage:
I was intolerable during that period. Although I wouldn’t admit it, I was
depressed. I got angry easily and lashed out at people, especially my wife. She
was there to support me, but I chose instead to use her as a lightning rod.
Fortunately, it did not permanently impair our relationship.
After resigning, McCrea took a six-month sabbatical to reflect
on his experience and decide what came next. Realizing he was an
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entrepreneur at heart, he began working with ClearPoint, a
competitor in health care training systems, soon becoming its
CEO. Since that time, McCrea has used what he learned from
his failure to build his new organization. He has teamed with a
strong operations partner and maintained a more conservative
balance sheet. He reflected, “While I hated every minute of the
Vitesse experience, I’m a more balanced person and more seasoned
executive as a result.”
Mike Sweeney: Dealing with Personal Illness
Mike Sweeney, CEO of piano maker Steinway, was only 28 when he
discovered he had testicular cancer. “That was the first time I realized
I wasn’t immortal,” he said. “In some ways I’d recommend it to
everyone. If you’re going to get cancer, testicular cancer is the one to
get because it is usually curable. Cancer caused me to think
differently about my life.”
Sweeney described an experience he had after all the treatments
were done:
I woke up one morning and literally couldn’t get up off the sofa. I got hit by
a wave of depression I had never experienced before. It wasn’t a matter of will;
I just could not get up.While I was fighting cancer, my work was to heal. When
that stopped, the room got really quiet, and all of a sudden I realized, holy cow,
I could die. At that age the thought of death never occurs to you.
The experience changed the way Sweeney thought and pro-
pelled him on a path of understanding himself and rethinking his life
and career.
The shock of not being able to get off that sofa scared me. I spent time thinking
about what I want to do, what is meaningful in my life, and who do I want to do
it with. I saw a psychiatrist and talked about having cancer not as a physical
matter, but an emotional one. Cancer gave me clarity about those things.
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His father told him that now that his cancer problem was solved,
he should shake it off and get back to work. “I thought there was
more involved than that,” Sweeney said. “I started asking myself
what is important to me in business and in life. I wasn’t less
ambitious; I just wanted different things out of life. I wanted to
build businesses where everyone involved did as well as I did.” Just as
Algorta did, Sweeney used this crucible to transform his life.
Sweeney had a second awakening when he turned 50. After a
highly successful decade as managing partner of a midsized private
equity firm, he noted, “Fifty was the first birthday that actually
mattered.”
I realized I only want to work for companies whose products or services make a
difference. Unlike private equity where we were always one step removed from
the action, I’d rather be on the front lines. I became chair of the Star Tribune
newspapers because I believe dissemination of news and information is essential
in the life of the community. Restoring the newspaper to profitability required a
new business model and new content that rebuilt subscription sales. We also
found a new owner committed to the community in Minnesota Timberwolves
owner Glen Taylor. In retrospect, working with a team of talented people on a
mission we pursued with passion was one of the best experiences of my career.
After retiring from the Star Tribune, Sweeney became CEO of
Steinway. He observed, “Here was a jewel of a company being
managed for cash that was at risk of losing the essence of what made
it great.” Before he could rebuild Steinway, Sweeney had to
restructure its dysfunctional board of directors, whose members
had conflicting purposes. To do so, he gained agreement to sell
the company to hedge fund investor John Paulson.
Paulson recognized that Steinway is an essential part of the cultural community
as well as an important financial asset, so I agreed to stay as CEO.Now we are
growing Steinway as a global business, while retaining the great craftspeople
who are so committed to making the highest-quality pianos. For me it’s a unique
opportunity to make a contribution.
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When Sweeney was a young man facing his own mortality, his
True North became clear. He continued to hold on to that thread in
his life and had the wisdom to make other career changes that kept
him aligned with his True North as his career continued.
Marilyn Carlson Nelson: Losing a Loved One
When you meet Marilyn Carlson Nelson of the hospitality con-
glomerate Carlson, you are struck by her warmth, zest for life, and
optimism that any problem can be solved by inspiring people to lead.
Yet hers is a more complex story. As if it were yesterday, she vividly
recalled learning the news of her daughter’s death. “My husband and
I heard one morning that our beautiful 19-year-old Juliet had been
killed in an automobile accident.”
That’s the most profound test we’ve ever had, a test of our faith and our
personal relationship. I lost my faith at the time and felt angry with God, but
God didn’t abandon me and didn’t let me go. I discovered how valuable every
day is and how valuable each person is. I decided to make whatever time I had
left meaningful so that the time Juliet didn’t have would be well spent. My
husband and I vowed to use every tool at hand as an opportunity to give back
and make life better for people. We are all human beings with one short time
on Earth.
Soon after her daughter’s death, Nelson joined Carlson full-time
as vice chair and later became CEO. At Carlson, she devoted
herself to empowering the organization’s 150,000 employees to serve
its customers in a highly personalized manner. Looking back at
her time at the helm, Nelson said she is proudest of the culture
she built.
Nelson used the trauma of her daughter’s death to rethink what
her life and leadership were about. By reframing this tragedy with a
newfound sense of mission, she transformed her leadership into
building strong institutions that serve others and address difficult
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issues facing society. She concluded, “Business well run is a force for
good in the world.”
My Crucibles Came Early
On my journey, I experienced several crucibles as I developed into a
leader. In my early years, I was hardly recognized by my peers as a
leader. I was not the one chosen to head organizations, elected to the
student council, or made captain of the tennis team. There was
a simple reason for this. I was so ambitious and self-centered that
I never took the time to develop close relationships.
In my desire to become a leader, I studied the biographies of world
leaders and the great business leaders of my era, attempting to develop
the leadership characteristics of these successful people. It didn’t work.
Nowondermy early attempts at leadership failed: I wasmore a persona
than an authentic leader. In high school, I ran for president of the
senior class but lost by a two-to-onemargin. I was devastated. I hadnot
yet learned what it takes to have people want to follow you. Looking
back on those years, I never felt good about myself or secure in my
relationships and thus came across as self-centered.
Discouraged, I went off to Georgia Tech so that I could have a
fresh start where no one knew me. I hadn’t yet learned the lessons of
mindfulness meditation from expert Jon Kabat-Zinn’s book, Wher-
ever You Go, There You Are. Eager for a fresh start, I joined many
organizations at Georgia Tech and ran for election six times. I lost
each one.
At this point, a group of seniors gaveme some sound advice. “Bill,
you have a lot of ability, but you seemmore interested in getting ahead
than you are in helping other people. No wonder no one wants to
follow your lead.” Devastated by this feedback, I took their advice to
heart. In the ensuing months, I asked for help from friends about how
I could change. I came to grips with my shortcomings and began to
focus on others instead of myself. As I gradually became more self-
aware, I was chosen to lead many organizations. Most rewarding of all
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was being selected as fraternity president by the same people who had
rejected me earlier. I learned the hard way I couldn’t escape my past
unless I changed myself in the present.
Coping with Tragedy
Bad things happen in life that we cannot anticipate. In my mid-
twenties, I faced two more crucibles for which I was wholly
unprepared. They brought me face-to-face with the meaning of
life, its pain, and its injustices.
After graduating from Harvard Business School, I went to work
in the Department of Defense. Feeling on top of the world, I loved
my work, friends, and new environment. Just four months later,
I received an emergency telephone call from my father. He could
barely speak as he told me my mother had died that morning of
a sudden heart attack. As my role model, my supporter, my ally, and
the person from whom I learned unconditional love, my mother was
the person the closest to me in the world. Arriving home that
afternoon, I will never forget my father’s face. Looking into his eyes,
I saw he couldn’t cope with Mother’s death. I had to become my
father’s father. In a real sense, I lost two parents in one day.
Not long after Mother’s death, I fell in love and got engaged.
Weeks before the wedding, my fiancée started to experience severe
headaches, double vision, and loss of sense of balance. I was so
worried that I took her to a leading neurosurgeon, who put her into
the hospital for a week of neurological tests. All her exams were
negative, but the severe headaches continued. The neurosurgeon
told us rather coldly that my fiancée was emotionally disturbed about
getting married, recommending she see a psychologist.
Intuitively, I knew this was a misdiagnosis. Something was
seriously wrong with my fiancée, but it was definitely not psycho-
logical. I was desperate but didn’t know where to turn for help.
The wedding was three weeks away, and we had still not sent out the
invitations. We talked by telephone on a Saturday night but were
paralyzed about what to do next. The following morning I returned
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home from church, where I’d been praying for my fiancée’s recovery.
Our large Georgetown house was dark, and the curtains were pulled,
which seemed odd for a sunny August morning.
One of my roommates met me at the door and asked me to
sit down in the living room. I immediately sensed the worst,
exclaiming, “She’s not dead, is she?” I felt shock and searing pain
as he nodded affirmatively. She had died that morning in her father’s
arms from a malignant brain tumor. Once again I tumbled into the
well of grief, alone in the world and unable to comprehend the
deeper meaning of what had happened. Thankfully, my friends
gathered around me that day and in the weeks that followed and
provided the love and support I so desperately needed. I will be
forever grateful to them.
This was a crucial time in my life when I could have easily
become bitter and depressed and even lost my faith. In times of
personal crisis, the grace of God and the power of faith can provide
the basis for healing. So can the support of friends. I was blessed to
have both. Together they gave me hope for the future and enabled
me not to feel sorry for myself, just for my fiancée and her family.
Tragic as these events were, they opened my heart to the deeper
meaning of life and got me thinking more profoundly about what
I could contribute to others during my lifetime. I came to the
realization that there are many things in life we may never be
able to explain. The words of St. Paul in 1 Corinthians 13:12
provided the greatest comfort: “Now we see through a glass, darkly;
but then face to face.”
Sometimes in life when one door closes, another one opens.
In the months that followed my fiancée’s death, I had the blessing
of meeting my future wife, Penny, who supported me in my grief.
We fell in love, and a year later we were married. The support of
Penny and my friends enabled me to turn my crucibles into post-
traumatic growth. Penny is the best thing that has ever happened
to me. She is an amazing wife, mother, grandmother, leader, and
counselor to me. We recently celebrated our forty-sixth wedding
anniversary, a source of great joy for both of us.
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Exercise: Your Greatest Crucible
After reading Chapter 3, think back over your life and recall the
experience that involved the greatest pressure, stress, or adversity.
1. Write freely about your greatest crucible, and describe:
a. How you felt at the time
b. The resources you called upon to get through it
c. How you resolved the issues, if you have
d. How this experience shaped you and your views about the
world
2. How can you use these experiences to reframe your life story and
understand yourself and your life more fully?
3. Are there ways in which these experiences are holding you back
today?
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Part Two
Developing as an
Authentic Leader
A Compass for the Journey

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Having examined your life story in detail, you are prepared to pursue
your development as an authentic leader. In our interviews, we
learned that there are five essential elements in your personal
development: self-awareness, values, sweet spot, support team,
and integrated life. With one chapter devoted to each area,
Part II challenges you to engage in continuous personal growth as
you become an authentic leader.
Taken together, these five elements form the compass that guides
you to your True North. After each experience, you need to calibrate
your compass to ensure the steps you are taking on your leadership
journey are consistent with your True North and the way you want
to lead your life. Because your circumstances, your opportunities, and
the world around you are constantly changing, this is a never-ending
process.
As you consider each of these areas, ask yourself the fundamental
questions listed in Figure II.1.
Figure II.1 Key Challenges of Leadership
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4
SELF-AWARENESS
Know Thyself.
—Inscribed at the temple wall at Delphi in Greece
during the sixth century BC
Self-awareness is the foundation of authenticity, and thus it is at the
center of your compass. You develop it by exploring your life story
and then understanding the meaning of your crucibles. As you do
this, you need to understand who you are at a deeper level. This is
hard work but an essential step in your development as a leader. A
foundation of self-awareness leads to self-acceptance and ultimately
self-actualization so that you can fulfill your greatest potential.
Arianna Huffington: Redefining Success
In 2007, Arianna Huffington’s career was on a rapid upward
trajectory. Several years after starting the Huffington Post, her
celebrity was rising, and she was featured on magazine covers.
Time chose her as one of the world’s 100 Most Influential People.
Then she had a wake-up call. One day she found herself lying on
the floor of her home office in a pool of blood, having collapsed from
exhaustion. She explained:
On my fall, my head hit the corner of my desk, cutting my eye and breaking my
cheekbone. I went from doctor to doctor, from brain MRI (magnetic resonance
imaging) to CAT (computed axial tomography) scan to ECG (electrocardio-
gram), to find out if there was any underlying medical problem beyond
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exhaustion. There wasn’t, but doctors’ waiting rooms proved to be good places
to ask myself deeper questions about the kind of life I was living.
The gravity of the collapse forced Huffington to confront reality
about her life.
I was working 18 hours a day, seven days a week, trying to build a business,
expand our coverage, and bring in investors. My life was out of control. By
traditional measures of money and power, I was highly successful, but by any
sane definition I was not living a successful life. Something had to change
radically, as I knew I couldn’t go on that way.
Huffington’s life did not begin on a fast track. She was raised in a
one-room apartment in Athens, Greece, where she lived with her
mother and sister. Her parents separated when she was 11 but never
divorced. Looking back, she credits her parents for shaping her. “My
mother was an incredible person who was self-taught,” she said.
She always made us see we were not limited by our circumstances. We could
pursue our dreams and if we failed, she wouldn’t love us any less. She told us,
“Failure is not the opposite of success. It’s a stepping stone to success.” My
father was a brilliant journalist who kept starting newspapers, all of which
failed. He started an underground newspaper during Germany’s occupation of
Greece, was arrested, and spent the war in a concentration camp.
At 19, Huffington went to Cambridge University, eventually
becoming president of Cambridge Union, the campus debating
society. After an English publisher watched a debate Huffington
organized on the changing roles of women, she received her first
book contract and produced The Female Woman. Continuing her
writing, she moved first to London and then to New York.
In 2005, she founded the Huffington Post. “Facilitating interest-
ing conversations has always been part of my Greek DNA,” she said.
The point of the Huffington Post was to take conversations found at water
coolers and around dinner tables—about politics and art and books and food
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and sex—open them up and bring them online. The site was created as a unique
combination of three things: news aggregation with an attitude, opinion, and
community. Our secret ingredient is our willingness to innovate.
The instant success of the Huffington Post had one victim—its
founder. Notoriety brought opportunities, and with opportunities
came an increasing workload. Huffington’s 2007 fall catalyzed her to
ask: “Is this what success looks like? Is this the life I want?”
As she prepared the 2013 commencement address for Smith
College, she conceived ideas for a Third Metric. “I ask you to redefine
success,” she told the graduates. “Don’t just take your place at the top
of the world, as so many Smith graduates do, but change the world.”
The Third Metric does not supplant the first two—money and
power—but it balances them. In her book Thrive, Huffington noted
eulogies rarely celebrate the first two metrics. It is our capacity for
well-being that truly enriches our lives.
Huffington was overwhelmed by the response to her speech.
“Society has a widespread longing to redefine success and what it
means to lead the good life,” she said. “This question has been asked
by philosophers since the ancient Greeks.”
Somewhere along the line we shifted our attention to how much money we can
make, how big a house we can buy, and how high we can climb the career
ladder. As I discovered painfully, these are far from the only questions that
matter in creating a successful life. I want to see millions more people around
the world embrace the recognition that a good life must go beyond the first
two metrics of money and power, and include well-being, wisdom, wonder,
and giving.
Like many of us, Huffington’s journey to self-awareness took
many turns. Money, fame, and power did not imperil Huffington to
the extent they did Rajat Gupta and Mike Baker, but they distracted
her from her True North. How could the same thoughtful woman
who frequently discussed her yearning for wisdom sacrifice her health
and well-being?
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This is actually a common occurrence for high performers, who
constantly walk a tightrope between the drive that makes them
successful and the perspective that keeps them grounded.
For tightrope walkers who balance intensity and reflection, self-
awareness acts like an internal ballast. In Huffington’s case, she
recognized the need to change her behavior well before something
more dramatic occurred, such as a heart attack. That ability to step
back and understand the alignment (or misalignment) of her actual
behavior and her vision for herself is part of what makes her a
remarkable leader.
Becoming Self-Aware
The charge to “Know Thyself” may be thousands of years old, but
following this advice is not easy to do. As human beings, we have
many aspects to our character.We are constantly evolving, as we test
ourselves in the world, are influenced by it, and adapt to our
environment—all to find our unique place. But you must be true
to yourself and follow your True North. If you knowwho you are, you
can achieve what you seek from life and overcome the obstacles
you face.
Discovering your authentic self becomes more complicated when
you face myriad options. These options either provide opportunities
to develop yourself or become seductions that take you away from
your authentic self.Without self-awareness, it is easy to get caught up
in chasing celebrity and the external symbols of success as Arianna
Huffington did, rather than becoming the person you want to be.
In life, you will be confronted by people who threaten you, do
not like you, or reject you.When you feel threatened or rejected, it is
difficult to regulate your emotions, control your fears, and avoid
impulsive outbursts. To protect yourself from harm, you may develop
a false self by building protective layers. In so doing, you become less
authentic. Without being aware of your vulnerabilities, fears, and
longings, it is easy to go off the track of your True North, and others
can take advantage of you.
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Gaining self-awareness begins with understanding your life story
and framing your crucibles (see Figure 4.1). Then you need to reflect
on your experiences through introspection and get feedback from
those who know you best. Early in their careers, many leaders try so
hard to establish themselves that they never take time for self-
exploration. As they age, they may find something is missing in their
lives or realize something is holding them back from being the person
they want to be. They may encounter a life-changing event that
causes them to reflect deeply on what they want from life.
For other leaders, memories of childhood are so painful that they
shut themselves off from their feelings. Anxious to bury these
memories altogether, they drive extremely hard to achieve success
in the tangible ways that are recognized in the external world—
money, fame, power, status, or a rising stock price. Often their drive
enables them to be successful, at least for a while, but it leaves them
vulnerable to derailment, because their lack of self-awareness can
lead to major mistakes and errors in judgment.
The Importance of Emotional Intelligence
Although intellectual intelligence, or IQ, has long been thought of as
an essential characteristic formanagers, new research is demonstrating
Figure 4.1 Gaining Self-Awareness
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that emotional intelligence (EQ) is more important for authentic
leaders. Psychologist Daniel Goleman, author of Emotional Intelli-
gence, outlines five areas essential to a high EQ: self-awareness, self-
regulation, social skill, empathy, and motivation. Through his
research, Goleman has found that above an IQ of 120, EQ becomes
the more important factor in predicting leaders’ success. Leadership,
interpersonal skills, and teamwork are worth far more than a few extra
IQ points.
Many leaders believe by being the smartest person in the room,
their intellect will carry the day. Leaders who lead only with their
intellect tend to dismiss the opinions of others and dominate decision
making. As a result, they overpower less forceful voices that have
vital ideas, insights, and answers needed for sound decision making.
Leaders with exceptionally high IQs often get too intellectually
involved and may be intolerant of others with less raw intellect.
Wells Fargo’s Dick Kovacevich argues high IQ can be an impediment
to leadership. “Above the ninety-ninth percentile of intelligence,
there is an inverse correlation between leadership and intelligence.”
Former Procter & Gamble (P&G) CEO Durk Jager is an
example of someone who failed because he tried to impose his
intellect on others. Jager was a brilliant strategist; however, his
abrasive style threatened the essence of P&G’s culture. As a result,
his management team rebelled, and the board asked him to step
down in less than two years. In taking his place, longtime P&G
executive A. G. Lafley used his deep understanding of P&G’s culture
to successfully build a leadership team that grew P&G and trans-
formed it into a global company.
Self-awareness should be the starting point in every leader’s
development. The leaders we interviewed said gaining self-aware-
ness was central to becoming authentic leaders. When Stanford
Graduate School of Business asked its advisory council the most
important capability for leaders to develop, their answer was nearly
unanimous: self-awareness. It is at the center of your inner compass
and an essential component of knowing yourself, discerning your
passions, and discovering the purpose of your leadership.
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David Pottruck: Journey to Self-Awareness
Of all the leaders we interviewed, David Pottruck, co-CEO of
Charles Schwab, had one of the most courageous journeys to
discovering his authentic self. He grew up in modest circumstances:
His father was a Grumman Aircraft machinist and his mother was a
nurse. He was an all-league high school football player and earned
a scholarship to the University of Pennsylvania.
Disappointed not to be recruited for professional football,
Pottruck went to the Wharton School for his MBA, joined
Citigroup, and later moved to San Francisco, to become head of
marketing at Charles Schwab. He worked extremely hard but
couldn’t understand why his colleagues resented his long hours
and aggressiveness in pushing for results. “I thought my accomplish-
ments spoke for themselves,” he recalled. “It never occurred to me
that my level of energy intimidated and offended other people.”
The most difficult thing in becoming self-aware is to see our-
selves as others see us. Leaders need accurate feedback to identify
their blind spots. Pottruck was shocked when his boss rated him
poorly, telling him, “Dave, your colleagues don’t trust you.” He
recalled, “That feedback was like a dagger to my heart. I was in
denial, as I didn’t see myself as others saw me.”
I had no idea how self-serving I looked to other people, but somewhere in my
inner core the feedback resonated as true. I thought about finding another job,
but Chuck Schwab asked me to stay and work out the differences with my team.
I had to confront my reality that I had to change.
Pottruck found changing was a very hard process.
The more stress you are under, the more you revert to your old patterns. Much
like Alcoholics Anonymous, I went and said to my colleagues, “I’m Dave
Pottruck, and I have some broken leadership skills. I’m going to try to be a
different person. I need your help, and ask you to be open to the possibility that I
can change.”
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Pottruck worked with a coach and developed a cadre of advisers
to use as a sounding board. His coach taught him about authenticity
and the power of storytelling. In speeches, he began telling stories
that revealed his life, fears, ambitions, and failures. Pottruck found
that people were inspired.
After his second divorce, Pottruck realized he still had large blind
spots. “When my first marriage ended, I was convinced it was all her
fault. After my second marriage fell apart, I thought I had a wife
selection problem.”Then he worked with a counselor, who told him,
“I have good news and bad news. The good news is you don’t have a
wife selection problem; the bad news is you have a husband behavior
problem.”
Yet Pottruck still struggled with denial.
I was like a guy who has had three heart attacks and finally realizes he has to quit
smoking and lose some weight. Denial is our biggest challenge we face. To
overcome, you must be honest with yourself and not make up excuses. This has
helped me accept criticism and take it seriously, even if it’s painful.
These days Pottruck is happily remarried and listens to his wife’s
constructive feedback, yet he still falls into his old habits, particu-
larly during moments of high stress. “We all want to be stroked,
admired, and complimented, but we have to listen to feedback we
don’t want to hear,” he noted.
Pottruck’s hard work in becoming self-aware paid off. He won
the support of his colleagues, and his dynamic leadership produced
outstanding results for the firm. As a result, Schwab promoted him to
be his co-CEO. During his 14 years at the helm of Schwab, Pottruck
substantially broadened Schwab’s business base while it became one
of the most admired companies in America and was named to
Fortune’s 100 Best Companies to Work For list. He concluded, “All
of us have an innate ability to become better.”
None of us is born perfect. We all have things we do wrong. Either you let them
get in your way your whole life, or you fix them. If I can help people believe they
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can improve, they too can make this journey of discovery, honest self-appraisal,
and hard work toward fundamental change.
David Pottruck readily acknowledges his imperfections—even
while admitting that it is hard to see them all. His experience of
discovering “blind spots” is instructive and humbling. He relishes the
opportunity to learn from every experience: “You don’t have to be
perfect,” he said. “You can start off on a bad path and recover. You
can turn most failures into successes if you ask yourself, What can I
learn from this so that I can do better the next time?”
Pottruck believes that the key is to avoid denial and be honest
with yourself. “If you’re open, you can learn a lot more from failure
than success,” he said.
When you’re successful, you take it for granted and move on to the next thing.
Failure forces you to reflect. What went wrong? How could I have done this
better? It’s an opportunity for you to take responsibility. The path of least
resistance is to blame it on someone else. I failed many times but learned from
each experience and managed to come back stronger.
Perfection is not the goal of authentic leadership; rather, it is
important to understand yourself at the deepest level. This process
takes introspection, feedback, and support. Credit Pottruck for always
learning and trying to improve his leadership. He did not want to
come across as untrustworthy, but he found that his aggressive
behavior fostered that perception among his Schwab colleagues.
To be successful, Pottruck did not mask his natural self. Rather, he
sought to bring forth deeper elements of himself that he had
previously cloaked and share stories that showed his vulnerabilities.
As a result, his colleagues connected with him more authentically.
Peeling Back the Onion
As you search for your true self, you are peeling back the layers of an
onion (see Figure 4.2). The outer layers of the onion are the visible
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ways you present yourself to the world—how you look, your facial
expressions, your body language, your attire, and your leadership
style. Often these layers are rough and hardened to protect you from
the assaults of the world around you. I once asked a teenage mentee
why he spent so much time in front of the mirror. His reply was
telling: “I need to look good on the outside, because I feel so rotten
on the inside.”
Understanding your outer layers is a necessary first step to going
deeper into what lies beneath, because these layers provide access to
your inner core. Peeling the onion further, you gain a deeper
understanding of your strengths, weaknesses, values, and motiva-
tions. Underneath the layers of your metaphorical onion lies your
Figure 4.2 Peeling Your Onion
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understanding of your life story. There your experiences create a
mosaic of your life. As you approach the deepest layers surrounding
your inner core, you find your blind spots and your vulnerabilities. At
the core of your being is your True North: what you believe and how
you envision your place on Earth.
As you explore who you are, you peel back one layer only to
discover a deeper and often more interesting layer underneath it. As
you get nearer to your core, you find that the inner layers feel quite
tender and vulnerable because they have not been exposed to the
assaults of the outside world. When you’re not in a safe place, you
cover your core self to protect it from exposure and harm. Too often,
this leads people to develop a false self or a persona. This persona
interferes with your ability to form genuine connections with other
people. Most important, it can obscure your acceptance of yourself.
Vulnerability Is Power
What would it mean if we were willing to be vulnerable and expose
our full selves to the world by just being our authentic selves? No
more false layers of protection. At first, it might be scary, but as we
realize that people accept and love us for who we really are, it would
be liberating: I can be who I am.
Yet many of us fear people will reject us if we show our
vulnerabilities, admit our weaknesses, and acknowledge our mis-
takes. Will they think less of us? Will they try to take advantage of
our weaknesses? As hard as we try to deny them, these questions nag
us when we are feeling most vulnerable.
For many years of my career, I felt I had to do things perfectly and
have all the answers. I lacked the confidence to share my weaknesses,
fears, and vulnerabilities. When I finally learned to do so, things
went much better for me, and my relationships with colleagues
improved. Most important, I felt more comfortable in my skin and
had a stronger sense of well-being.
In his book Love Leadership, John Hope Bryant, who was
homeless for six months in his teens, proclaims, “Vulnerability is
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power.” When I share this idea with executives in my classrooms, a
look of fear comes over some of them. Yet Bryant backs it up with his
life story and personal experiences of being vulnerable. He grew up
poor in the rough neighborhood of South Central Los Angeles. He
recalled, “When I was five, my parents divorced over money, the
number one cause of divorce in America.”
Bryant’s life was a roller coaster. He had a strong work ethic and
an entrepreneurial spark that resulted in some early business suc-
cesses. However, by his late teens, he was struggling. “I didn’t know
my True North, and didn’t have any role models to help me figure it
out,” he explained.
So I faked it, acting like a big cheese, wearing sunglasses at night to feel
important. It was just low self-esteem. Then I came up short one too many
times, lost an investor’s money and couldn’t pay him back, and wound up
homeless. I went from having a beach house in Malibu to living in my leased
Jeep behind a restaurant. Everybody knew I lost everything because I was so
arrogant. People were literally cheering for my failure.
Life is 10 percent what happens to you and 90 percent how you respond. I
had gotten into that mess, and had to work my way out of it. It grew resilience in
me. You cannot go to the highest mountain unless you go to the depths of the
valleys. The key to success in life is navigating your pain.
In 1992, when the Los Angeles Police Department officers who
had been videotaped beating Rodney King were found not guilty at
trial for assault and use of excessive force, people rioted in Bryant’s
neighborhood. “I remember asking Reverend Jesse Jackson what I
could do to help,” he said. “He told me, ‘We need businesspeople
with investment to rebuild this community. Take your business skills
and put them to work.’” With that, 19-year-old Bryant sprang into
action. The next day he organized a group of bankers to take a bus
tour through South Central Los Angeles. That eventually led to the
founding of Operation Hope, a social investment bank that aims to
eradicate poverty and grow the U.S. economy. As CEO, he is now
recognized for his efforts to enable low-income people to become
financially literate and build their own businesses.
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Reflecting on his experiences, Bryant said, “Vulnerability is the
key to freedom.”
If I’ve got nothing to hide and admit my faults before you can call them out,
what are you going to do to me? Being self-aware without being vulnerable leads
to depression and schizophrenia because there’s no expression. We’re looking
for love in all the wrong places. Our addictions are caused by emotions we can’t
handle. So we medicate ourselves with drugs, alcohol, shopping, overworking,
or sex. Tomorrow we need more of these seductions in order to give us the
second buzz. Eventually our addictive response cocktails are filled up to the top,
and we die inside.
He said the alternative is feeling good in our skin, which directly
correlates with our willingness to be vulnerable. He observed:
If I don’t feel comfortable in my own skin, there is no way I am willing to be
vulnerable. So I live a lie by creating a false persona. People are smiling when
they feel like crying. They’re laughing, but they’re miserable inside. The only
path forward is healing: You’ve got to find your True North.
There are three ways to live—suicide: physically, mentally, spiritually, or
emotionally; coping, which is what most of society is doing; and the last way to
live is to heal. Healing is the only path forward, but it is the most courageous
and most terrifying. To heal, you’ve got to get over the fear of just being
yourself. Most adults we’re dealing with are reliving pains of their childhood—a
domineering mother, an abusive or absent father, or [experiences of] being
ignored, chastised, molested, teased, or bullied. A lot of bullies today who walk
around looking cool with tons of money are just trying to escape memories of
being little kids in school with thick glasses on.
Bryant has not had an easy life but did have the resilience to
bounce back from adversity. He also has had the courage to share his
story and inspire others. In my classroom, he openly acknowledged
the pain he experienced in being homeless. He comes across as
being less than perfect, but this makes him more sympathetic,
more believable, and more persuasive. Bryant’s vulnerability is his
power. Through his authenticity, others connect with him. Former
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president Bill Clinton, former ambassador Andrew Young, and
Fortune 500 CEOs are now partnering with Bryant. His bold goal
is to create 1,000 HOPE Inside locations as he scales Operation
Hope to become the nation’s private banker to low-income and
struggling middle-class Americans.
Reflection and Introspection
How can we develop self-awareness and acceptance of ourselves? The
best ways are having an introspective practice and getting honest
feedback. In the über-busy, 24/7 world in which we are electronically
connected virtually all the time, we need to have daily practices that
enable us to pause and focus on ourselves, take stock of our actions and
pressures, and go deeper inside ourselves. Reflecting on our life story
and our crucibles helps us understand them at a deeper level. Then we
can reframe our story in a coherent way so that our actions and
decisions are congruent with understanding who we are.
Randy Komisar’s Struggle to Find His Track
Randy Komisar went through a period of deep reflection to figure out
what he wanted out of life. At LucasArts, he clashed frequently with
legendary founder George Lucas, creator of Star Wars. Frustrated by
his lack of independence, Komisar became CEO of LucasArts’s rival
Crystal Dynamics. It turned out to be the worst decision he ever
made, as he realized the business did not stir his passions.
I couldn’t find my reason for being there. The business floundered and
ultimately succeeded, but I failed. First, I had to admit my mistakes. Then
I had to face tough issues like, What do I want out of my life? I could have made
Crystal work, but at what cost? I hadn’t asked myself that question before.
He resigned after a year and began practicing meditation to gain
clarity, with a Buddhist monk as his teacher. “That was a point in my
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life when it was time to just be.My Buddhist practice was formative
for the next phase of my life.” After reflection, Komisar realized the
conflicts inside him traced to his father and grandmother. His father
craved material success and gambled constantly. “When he lost
money, we feared we couldn’t pay our college tuition. Insecurity
about money was ingrained in me as a child,” Komisar said. He was
close to his grandmother, who died when he was 10. “We bonded in
ways I never did with anyone else,” he said. “Her death devastated
me. She had incredible influence on my life. She was generous,
interested in people, and had great character. She loved people and
they loved her.”
Komisar recognized he needed to release himself from his father’s
influence and to embrace his own desires. “I was on a fast track, but it
wasn’t my track,” he said.
There was a war inside me between my need for fulfillment versus being
successful in my father’s eyes. I had to let go of the notion I was climbing the
ladder of success, and recognize I was on a long and winding journey. The
ability to face reality and acknowledge that you can fail and still feel good about
yourself is an important turning point in your self-awareness.
Only when leaders accept who they are and release the need to be
on someone else’s fast track can they be comfortable in their own skin.
There are several introspective practices that leaders find effective in
enabling them to focus their attention and their energies. The most
powerful of these ismeditation.Meditationhas recently comeof age as
a mainstream practice. In 2014, Time put the ideas of meditation
teacher JonKabat-Zinnon its cover.Hehas taught secular programs in
mindfulness-based stress reduction for more than 45 years.
Arianna Huffington started meditating when she was 13 but had
difficulties maintaining her practice. Since her 2007 fall, she starts
every morning with 20 minutes of meditation. She noted:
I respect the principles of Buddhism and have incorporated them intomy daily life.
My conversations with the Dalai Lama have been hugely influential. I’m in awe
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of theway he looks to neuroscience to convince our skeptical and secular society of
the power of contemplation and compassion to change our lives and our world.
In 1975, at my wife’s insistence I went to a four-hour program
on Transcendental Meditation. At the time I was going nonstop
from dawn until evening, having late dinners, and then coming
home exhausted. I even got denied for life insurance because of
high blood pressure. So I started meditating twice a day—not as a
spiritual practice, but for health reasons. Forty years later, I am still
practicing regularly.
Meditation is the best thing I have ever done to calm myself and
separate from the 24/7, connected world. By centering into myself, I
am able to focus my attention on what’s really important, and
develop an inner sense of well-being. Through meditation, I am
able to gain clarity about important issues. My most creative ideas
come from meditating. Most important, meditation has enabled me
to build resilience to deal with difficult times. I have no doubt it has
helped me become a better leader.
Chade-Meng Tan, Google’s Jolly Good Fellow
Leading companies, such as General Mills, Aetna, Black Rock, and
Goldman Sachs, are encouraging their employees to establish medi-
tation practices. At Google, perhaps the world’s most innovative
company, meditation has taken off. Chade-Meng Tan, who is
known as Google’s Jolly Good Fellow, has taught thousands of
employees how to meditate.
Tan was born in Singapore, a child of Chinese immigrant
parents. He was exceptionally bright, becoming the national pro-
gramming champion at 17. In spite of his accomplishments, Tan
said, “I was deeply unhappy as a child because I didn’t fit in. I had the
perpetual feeling I didn’t deserve to be loved. After I completed my
master’s degree at the University of California at Santa Barbara,
I joined Google as employee #107.”
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My breakthrough came in 1991 when I discovered meditation. It was a
moment of great insight where suddenly everything in my life made sense.
Before I was a meditator, I was very depressed. Since meditating regularly, I
have become very happy. It was a huge change. Through meditation I learned
the ability to calm my mind on demand and stay in a state of clarity and
calmness as long as I want to. A key part of my practice is kindness and
compassion. You cannot be genuinely compassionate toward others if you have
no compassion for yourself.
Tan described the creation of Google’s meditation program:
In 2003, I had an epiphany that we could create the conditions for world peace
through scaling inner peace, joy, and compassion worldwide by aligning them
with success and profits. The solution was emotional intelligence (EQ). I
engaged some of the world’s top experts, and together we created Search Inside
Yourself. In addition to teaching 2,000 Googlers per year to meditate, we also
founded the non-profit Search Inside Yourself Leadership Institute, which has
been training clients like SAP and Kaiser.
Meditation isn’t for everyone. There are many other intro-
spective practices that leaders find effective: saying a centering
prayer, taking a long walk, or having deep discussions with a loved
one. The important thing is to have an introspective practice you
do daily.
The Importance of Feedback
One of the most important skills leaders need to develop is the ability
to see themselves as others see them. Honest feedback is often hard
to get, because far too many people tell leaders what they want to
hear. For this reason, authentic leaders have to seek out feedback
from their peers and subordinates. One of the best ways to do this is
through anonymous, 360-degree feedback.
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Feedback is an essential tool to use to get outside our egos and
listen to constructive criticism we may not want to hear. Verizon’s
Judy Haberkorn explained:
They called me the feedback queen. The best thing you can get in this world is
honest feedback from someone who cares about your success and well-being.
Some are more self-aware than others, but few of us see the world as it sees us.
KrogerCEODavidDillon discovered the value of feedback during
college after he lost an important election. His first reaction was to get
defensive and think, “I’m better than that guy. Why didn’t they
choose me?” Following introspection, he realized, “My point of view
wasn’t relevant. The important one was what others thought.”
Through feedback, he learned he had a number of traits that needed
improvement. As a result, he went on to become president of the
student body at the University of Kansas and of his fraternity, the first
steps in a life of successful leadership. Dillon said, “Feedback helps you
take the blinders off, face reality, and see yourself as you really are.”
Dillon regularly asks his colleagues at Kroger for feedback.
Occasionally, it hits too close to home.
When I get defensive, I go back and apologize, saying, “My reaction was
against me, not you. My defensiveness is a mechanism to cope with unpleasant
personal news. I assure you I hold you in higher regard because you shared that
with me.”
In Chapter 7, we describe the importance of having a support
team—spouses, friends, mentors, and small groups—who will give
you honest feedback.
Opening up Hidden Areas
The Johari Window, designed in 1955, is a means of gaining self-
awareness and becoming more open.
For many of us, the upper left quadrant—known to ourselves and
others—is far too small (see Figure 4.3). Opening up this quadrant is
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crucial to becoming more authentic. The easiest way to do so is to
share more of our hidden areas—known to ourselves but not to
others—with other people. This requires sharing your life story and
difficult times, along with exposing your weaknesses. When we do,
we are validated by other people, not rejected as many fear, and this
enables us to truly be ourselves.
In the upper right quadrants are blind spots—known to others
but unknown to us. This is undoubtedly the most difficult area to
address. Nearly all of us have traits, habits, and tendencies that
others see in us but we are unable to see in ourselves. The only way to
open our blind spots is to get honest feedback from others and take it
to heart. Seeing our blind spots and opening up our hidden areas
enables us to be fully open, transparent, and authentic as leaders.
Lord John Browne and Tim Cook: Emerging
from the Closet
For five years, I sat next to Lord John Browne, then chief executive of
British Petroleum (BP), as we served together on the Goldman Sachs
board. Browne has a brilliant financial mind and was a superb chair
of Goldman’s audit committee. He was also gay, a subject we never
discussed. In May 2007, he was forced to resign from BP for perjuring
himself by giving false testimony about how he met a former lover.
Figure 4.3 The Johari Window
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As he writes in his poignant 2014 book, The Glass Closet, “My
overwhelming desire to conceal my sexual orientation over four
decades in the oil industry had culminated in this terrible juncture.”
My long-kept secret was about to be exposed and I was not going to hide any
longer. My refusal to acknowledge my sexual orientation publicly stemmed
from a lack of confidence. Inside I concealed deep unease and had to deal with
inner turmoil almost daily. It is difficult to feel good about yourself when you
are embarrassed to show who you actually are.
Closeted people cannot fully grasp how much their secret weighs them
down. But living a lie is too costly. One’s life should not be built around pleasing
the minority of people who may find your sexual orientation objectionable. It
should be built around creating meaningful relationships with people who value
you, not what you pretend to be.
Although legal barriers against gay people are falling rapidly, it
remains a tragedy that old norms in our society have prevented so
many people from being open about who they are. Remarkably,
Browne was the first chief executive of a Fortune 500 company to
publicly acknowledge he is gay. His openness has encouraged others
to follow suit. In 2014, Apple CEOTimCook addressed his sexuality
in an article, writing:
While I have never denied my sexuality, I haven’t publicly acknowledged it
either, until now. So let me be clear: I’m proud to be gay. I consider being gay
among the greatest gifts God has given me. Being gay has given me a deeper
understanding of what it means to be in the minority and provided a window
into the challenges that people in other minority groups deal with every day.
It’s made me more empathetic, which has led to a richer life. It’s been tough
and uncomfortable at times, but it has given me the confidence to be myself, to
followmy own path, and to rise above adversity and bigotry. It’s also givenme the
skin of a rhinoceros, which comes in handy when you’re CEO of Apple.
Cook said he is not defined by his sexuality: “I’m an engineer,
uncle, nature lover, fitness nut, son of the South, sports fanatic, and
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many other things.” This letter gives us a window into his soul. Cook
has not only accepted his sexuality; he has also accepted himself.
“The Civil Rights Issue of our Time”
When all banks were under great pressure in 2011, Goldman Sachs
CEO Lloyd Blankfein had the courage to take on what he calls “the
civil rights issue of our time”—equal treatment for gays and lesbians.
Blankfein, a Harvard-trained lawyer who is happily married with
three successful children, knew well the price of discrimination from
encounters with anti-Semitism early in his life. While other CEOs
were holding back from addressing these issues, Blankfein stepped up
and became a national spokesperson for the lesbian, gay, bisexual,
and transgender equality movement.
InMinnesota, when we were facing the threat of a constitutional
amendment to ban same-sex marriage—what I term “legalized
discrimination”—Blankfein came to the state at my request and
gave a poignant speech that helped turn the tide against this onerous
amendment. Not only was it defeated, but also six months later the
Minnesota legislature legalized same-sex marriage.
All of us have hidden differences we are reluctant, even
ashamed, to reveal to those closest to us. What closet are you hiding
in? Wouldn’t you feel better if you could reveal your secrets to others
close to you? Opening up our hidden areas is an essential part of
accepting ourselves as we are. Browne’s wisdom applies to us all:
Only by opening up ourselves to others can we find that deep sense of
well-being.
Self-Compassion and Self-Acceptance
When we are self-aware, we can develop compassion for ourselves
and the challenges we have faced in navigating life’s difficulties.
Only through self-compassion can we have genuine empathy for
others and the difficulties they have faced. Respecting others’
experiences requires you to love yourself unconditionally first.
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In The Poetry of Self Compassion, poet David Whyte talks about
dealing with your weaknesses and shadow sides so that you can
accept the things you like least about yourself. That requires digging
into experiences you have hidden for years. Whyte says you cannot
wall yourself off from the pain of past experiences. Like David
Pottruck did, you have to confront them directly, accept yourself
unconditionally, and learn to love your weaknesses as much as you
revel in your strengths. That level of self-compassion enables you to
get to the source of your True North.
It is easy to love our strengths and bask in our successes. Even
Narcissus could do that. To love ourselves unconditionally, we
have to learn to accept ourselves as we are, with all our warts and
our flaws, rather than wish we were different. Reatha Clark King
captured this feeling when she said, “I feel good in my skin. I
get along well with myself and have learned to accept myself race
wise and gender wise.”
Once armed with a high level of self-awareness and self-accep-
tance, it is much easier to regulate your emotions and your behavior.
Your emotional outbursts usually result when someone penetrates to
the core of what you do not like about yourself, or still cannot accept,
as Dave Dillon described. By accepting yourself just as you are, you
are no longer vulnerable to these hurts. You are prepared to interact
authentically with others who come into your life—your family,
friends, and coworkers, even complete strangers. Free of having to
wear a mask, you can focus on pursuing your passions. That leads you
on the path to self-actualization, which enables you to fulfill your
greatest dreams.
Becoming a Mindful Leader
Given the pressures of today’s world, and the failures of many leaders,
there is rapidly growing interest in mindfulness. Mindfulness is the
ability to focus your attention on your thoughts, emotions, and
feelings in the present moment.
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Psychologist Ellen Langer, often called “the mother of mindful-
ness,” published her classic workMindfulness in 1989, long before the
practice was accepted in the mainstream culture. She sees mindful-
ness as the essence of leadership. She added:
Whatever you’re doing, you’re doing it mindfully or mindlessly. The conse-
quences of being in one state of mind or the other are enormous. Virtually all of
the ills individuals experience are the result of mindlessness. As the culture
becomes more mindful, we increase our effectiveness, our health, and our
overall well-being.
In 1979, I learned an important lesson from Buddhist monk
Thích Nh�̂at H:anh: “The longest journey you will ever take is the
18 inches from your head to your heart.” Our hearts are where such
essential leadership qualities as passion, compassion, and courage
reside. By practicing mindfulness, mindful leaders exhibit high levels
of self-awareness and intentionality in their actions.
The key to effective leadership is the ability to integrate your
head (IQ) with your heart (EQ). Jon Kabat-Zinn explained:
In Asian languages mind and heart are the same word. Mindfulness is not
just about our minds but our whole beings. When we are all mind, things get
rigid. When we are all heart, things get chaotic. Both lead to stress. When
the mind and heart work together—the heart leading through empathy, the
mind guiding us with focus and attention, we become harmonious human
beings.
Exercise: Knowing Your Authentic Self
1. What are your vulnerabilities, blind spots, and shadow sides? To
what extent do you use defensive armor as a shield to protect
yourself from exposing your vulnerabilities with others?
2. When you face displeasing situations or receive critical feedback
from others, how well are you able to take in the feedback and
respond in a constructive manner without acting defensively?
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3. Howwell do you understand the emotional makeup of others and
their needs? How sensitive are you in relating to others’ needs
and helping others? How skillful are you in building lasting
relationships?
4. How comfortable are you with who you are right now?
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5
VALUES
Leaders with principles are less likely to get bullied or
pushed around because they can draw clear lines in the
sand . . . The softest pillow is a clear conscience.
—Narayana Murthy, founder and CEO, Infosys
In gaining self-awareness, it is important to identify the values and
principles that guide your leadership. The values that form the basis
for your True North are derived from your beliefs and convictions.
Staying centered on those values is not easy. The temptations and
pressures of the outside world often conspire to pull you away from
your True North.
David Gergen: Crisis Strengthened His Values
David Gergen wanted to lead a life consistent with values he learned
from his family and the Durham, North Carolina, community where
he grew up. He is the only person to serve as a senior White House
adviser to four U.S. presidents: Republicans Richard Nixon, Gerald
Ford, and Ronald Reagan and Democrat Bill Clinton.
Gergen was 28 when he was hired as aWhite House speechwriter
during Nixon’s first term. He had a ringside seat for history as it was
being made. “When I first arrived, the power, glamour, and status
went to my head,” he said. Years later, he realized how naive and
unprepared he was for the events of the next few years—particularly
the Watergate scandal.
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Initially, his talent and ambition enabled him to become a rising
star in the Nixon administration. He recalled, “I was grasping for the
brass ring and was as ambitious as everybody else, probably more so.”
After Nixon’s 1972 reelection, Gergen was named head of the
president’s speechwriting and research team, with the responsibility
for supervising 50 people. “It was tempting to fall into the trap of
thinking I was important, instead of recognizing that people think
you’re important only because of where you’re standing. I had some
of the arrogance that other people in that administration had,” he
reflected.
When stories about the Watergate cover-up began to emerge in
early 1973, Gergen did not believe the allegations were true. “We
were continuously reassured that neither Nixon nor anyone high
up in the White House staff had done anything wrong,” he
explained. “Nixon told us that directly, and Bob [Nixon’s chief
of staff ] and others confirmed it in the most adamant terms.”As the
public’s focus on Watergate intensified throughout 1973 and 1974,
an increasing number of staff members resigned, including some of
Gergen’s team. However, he did not feel he could leave. “My
resignation would have made a public statement about my lack of
belief in President Nixon’s integrity. So I stayed and kept hoping
against hope he was innocent.”
Gergen learned of Nixon’s guilt only two days before the news
broke in August 1974. Even then, he did not feel he could leave, lest
he be viewed as “a rat leaving the sinking ship,” especially when
Nixon asked him to write his resignation letter. As he watched
Nixon leave the White House for the last time on the presidential
helicopter Marine One, Gergen thought his career in public life was
over. He recalled the infamous 1919 Chicago Black Sox World
Series team, whose players were accused of cheating and banned
from baseball for life. “I thought I’d never play again,” he said.
“Watergate was an epiphany for me. It shattered my notion that
because you are in a position of power and glamour you can rise
above being challenged. You can’t.”
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Almost immediately, Gergen’s phone stopped ringing. “Sud-
denly, you’re not as glamorous as you were. You realize just how fast it
all comes and goes.” During the lonely and depressing days that
followed, Gergen was most impressed by the people who stood by
him—primarily his old friends from Durham and his college class-
mates. “When you’re in trouble and all your defenses get stripped
away, you realize what matters and who matters,” he said.
That’s when you need to get back to your roots and to your values. The people
who were innocent have come back to outstanding careers. Jon Huntsman,
founder of Huntsman Corporation, was one who did that. Hank Paulson is
another who came through it and had an extraordinary career as CEO of
Goldman Sachs and secretary of the Treasury.
“Since that searing experience with Watergate,” Gergen con-
cluded, “I have always favored transparency.”
I have frequently disagreedwith those I worked for, because theWatergate lessons
were so vivid in my mind. They remind you that you have to stay true to your
values. Nixon did not have a moral compass, and everything went off track.
Gergen’s Watergate experience was formative in his develop-
ment as an authentic leader. He recognized the glamour and
prestige of a senior White House position had seduced him into
abandoning his values. He strengthened his relationships with
people who were there for him when his world was collapsing.
Gergen’s ability to process this early experience fortified his
character, which in turn improved his ability to advise Presidents
Ford, Reagan, and Clinton.
These days Gergen is teaching at Harvard Kennedy School and
developing future leaders as director of the Center for Public
Leadership. The center provides fellowships for talented leaders,
with Gergen acting as their mentor and coach. As a CNN com-
mentator, he shares his perspective on national affairs, bringing an
important level of objectivity and wisdom to the public discourse.
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Values, Leadership Principles, and Ethical Boundaries
Perhaps you have engaged in exercises in which you list your values
and force-rank them in order of importance. It is relatively easy to be
true to your values when things are going well. In defining your
values, you must decide what is most important in your life. Is it
maintaining your integrity? Helping other people? Devoting yourself
to your family? There is no one right set of values. One person may
value practicing kindness in all interactions. Another person may
value championing excellence. Only you can decide what your most
deeply held values are.When you do, you will be better positioned to
align with people and organizations that share similar values.
Several of the leaders interviewed for this book referred to their
values as being their moral compass. Former Johnson & Johnson
chairman and CEO Jim Burke made the expensive but courageous
decision to recall Tylenol products in the United States in 1982 after
it was discovered that a terrorist had inserted cyanide into some
Tylenol capsules. He observed, “Without a moral center, you will
swim in chaos.”
When you have a clear understanding of your values and their
relative importance, you can establish the principles by which you
intend to lead. Leadership principles are values translated into practice.
They are like navigational instruments sailors use to get their
bearings at sea, as they fix the direction of their travel. For example,
a value, such as “concern for others,” might translate into a leader-
ship principle, such as “create a work environment where people are
respected for their contributions, provided job security, and allowed
to fulfill their potential.”
All leaders operate with principles, even if they do so sub-
consciously. Take the basic question “What motivates people?”
Some leaders believe people are motivated to do as little work as
possible. They lead by principles that establish strict rules of conduct
and behavior and enforce them rigidly to ensure people stay on task.
Other leaders believe that people genuinely want to do a good job
and find significance through their work. They operate with a
principle of empowerment that gives people freedom to do their
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work, encourages them to excel, and trusts them to monitor
themselves.
After defining your leadership principles, you will need a clear
understanding of your ethical boundaries. If values inform the
positive principles you intend to live by, ethical boundaries set
the absolute limits you place on your actions. You will encounter
many gray areas in your life and work. Where do you draw the line
between actions that are acceptable and those that are not? What
lines will you refuse to cross?
Figure 5.1 demonstrates the relationship between values, ethical
boundaries, and leadership principles. Those who develop a clear
sense of their values, principles, and ethical boundaries before they
get into crises are better prepared to keep their bearings and navigate
through difficult decisions and dilemmas when the pressure mounts.
Narayana Murthy: Building a Company with Principles
Narayana Murthy is a successful entrepreneur who founded the
global technology services company Infosys on a clear set of guiding
principles from which he has never deviated. Murthy grew up lower
middle class in southern India. His father was a civil servant who
took pride in his high ethical standards. In his youth, Murthy was
influenced by the teachings of Mahatma Gandhi and was involved
with socialist youth organizations. He became a strong believer in
redistributing wealth to alleviate India’s massive poverty.
AfterMurthy’s college graduation, his professor nominated him to
go to Paris to install a logistics and baggage-handling system atCharles
Figure 5.1 Defining Your Values, Principles, and
Ethical Boundaries
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de Gaulle Airport. The intellectuals Murthy met at Parisian cafés in
the late 1960s fascinated him. Describing his time there, he said, “As a
23-year-old Indian, I grew up on a heavy diet of Nehru’s socialist
philosophy. In Paris, I got the inspiration for compassionate capital-
ism. I learned how French people put the interest of community ahead
of their own interests.”
Returning to India, Murthy and a group of younger colleagues
founded Infosys Technologies in 1982 and built it into India’s leading
information technology outsourcing company. Infosys gave Murthy
the platform to translate his values into practice. “Our dream was to
demonstrate that you could run a business in India without corrup-
tion and create wealth legally and ethically,” he explained.
From the outset, Murthy and his colleagues wanted to create
India’s most respected company. Despite difficulties in starting the
business, Murthy and his team adhered to a principled approach.
Because Murthy refused to pay bribes, Infosys had to wait nearly a
year for installation of a telephone line. “What drains your energy or
enthusiasm is not the fiscal problem, but violating your value
system,” he said.
Leaders with principles are less likely to get bullied or pushed around because
they can draw clear lines in the sand. We always believed that the softest pillow
is a clear conscience. I feel fortunate we have never had a situation where we
lost sleep because we did something wrong.
Eventually, the demands for bribes ceased. “If you refuse to
buckle on the first couple of transactions,” said Murthy, “they will go
trouble someone else.”
Compliance with the value system creates an environment that enables people
to have high aspirations, self-esteem, confidence in the future, and the
enthusiasm to take on difficult tasks. Leaders have to walk the talk and
demonstrate their commitment to the value system. There is a direct correlation
between the value system of our company and the success we have had over the
last 24 years.
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Murthy’s experience living in France had a formative impact on
his thinking about his principles and led to the growth and success of
Infosys. I have rarely met a business leader who is as intentional
about knowing his values and establishing his leadership principles
as Murthy. He also had the courage to stick with these values even
when they deviated from cultural norms.
More than 30 years after Murthy founded Infosys, it has achieved
remarkable success. The company’s market capitalization now
exceeds $35 billion. When Murthy departed from the company
at 68, he declined to become chairman emeritus, saying he believed
corporate governance was best served if the current leadership
assumed full responsibility.
Sam Palmisano: Leading by Values
As CEO of IBM from 2002 to 2012, Sam Palmisano shifted IBM’s
culture from management by objectives to leading by values. In
doing so, he united IBM employees as a powerful global force in
information systems. When he took over from Lou Gerstner, his
iconic predecessor, Palmisano did not create new values or merely
reiterate the values founder Thomas Watson established. Instead, he
initiated a company-wide, online process in which all employees
around the globe participated for three days in determining what
IBM’s values should be. In announcing IBM’s 2003 Leading by
Values initiative, Palmisano wrote:
Many people these days have grown cynical. They’ve lost faith in the idea that a
business, a government or any other institution can run itself on the basis of
enduring, commonly held beliefs. That’s a shame. Maybe people wouldn’t feel
that way if more individuals in business—not just the leaders, but people at all
levels—stood up, declared what they believe in, and then took meaningful steps
to make it real, to put their values into practice.
How do you marshal the collective aspirations of 316,000 people serving
customers in 165 countries? We could rely on traditional supervision, process
and controls. But in the end, our clients simply wouldn’t stand for that, because
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it would inhibit our ability to serve them responsively. And neither would all of
you, because it would stifle your creative energies. We cannot apply Industrial
Age management systems to address a post–Industrial Age need. And we can’t
just dust off the old mantras. These must be genuinely shared values. They
can’t, today, be imposed top-down.
Palmisano used the values that emerged from this process to align
IBM’s employees into a globally integrated network that could
execute the company’s strategy of delivering complete enterprise
technology solutions. During the online “values jam,” he posted
frequently on the company intranet. He informally comments from
that project was: “We have a unique opportunity for IBM to set the
pace for all companies, not just the techs.”
Working with Palmisano on the ExxonMobil board, I witnessed
as he put his principle of trusting and empowering employees into
action. “The old model of the heroic superman is increasingly
archaic,” he said. “Never confuse charisma with leadership. The
most successful leaders today see themselves as part of the global
community. The key is to build a sustainable culture.” For Palmisano,
values are the mechanism for building that culture.
Testing Values under Pressure
It is relatively easy to practice your values when things are going
well. To understand your values, look at past situations when you
were tested under pressure. What behaviors felt authentic? What
behaviors do you regret? It is likely that your values shaped your
behaviors. When you are forced to make trade-offs between your
values under difficult circumstances, you learn what is most impor-
tant in your life.
By reflecting on your behavior, you can understand the under-
lying values that shaped it. Did you uphold the value of honesty,
even when it came at great personal cost? Or did you dissemble or
stretch the truth and now feel shame or guilt? With reflection, you
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can assess whether your stated values match your own internal sense
of right and wrong. With resolve, you can commit to overcoming
vulnerabilities that may cause you to stray from your values. You will
have many opportunities to realign your values with your compass
and improve the way you are living out those values.
That’s the test that Jon Huntsman faced.
Jon Huntsman: Testing Values under Pressure
In preparing for a day when your values conflict with those of your
organization and with each other, you need to decide what you want
to stand for in your life. How will your obituary read? What do you
want people to say at your funeral?
The life of Jon Huntsman Sr., founder and chairman of
Huntsman Corporation, the $13 billion chemical company, illus-
trates the way one person answered these questions. To the outside
observer, Huntsman seems to lead an idyllic life, one marked by
integrity, clarity of values, a large and successful family, and material
success. Yet Huntsman has been tested at least three major times in
the most severe ways. Each time he was forced to look deep inside
himself to determine what he stood for.
Huntsman has strong views about his values and the importance
of values in the lives of others.
Each of us possesses a moral GPS—a compass or conscience programmed by
parents, teachers, coaches, grandparents, clergy, friends, and peers. The
compass is an integral part of our being. It continues to differentiate between
proper and improper behavior until the day we die.
Born in a humble family in rural Idaho, Huntsman said his
values and leadership style are inextricably linked to his family
roots. Although he was close to his mother, he never developed a
close relationship with his father, who was a stern disciplinarian.
“My mother was a sweet, loving person who never said a negative
word about anyone. Because of her, my heart has always been soft.”
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He observed, “I was taught to play by the rules: Be tough, be
competitive, but do it fairly.”
The principles we learned as children were simple and fair. With moral
compasses programmed in the sandboxes of long ago, we can navigate career
courses with values that guarantee successful lives, a path that is good for one’s
mental and moral well-being, and the opportunity for long-term material
success.
When Huntsman was just out of college, his mother developed
breast cancer and died in her fifties. “She suffered so much that it
broke my heart,” he said. Nor was her suffering the family’s only
brush with cancer. His father died of prostate cancer, and his
stepmother died from ovarian cancer. Huntsman himself has twice
overcome cancer, the dark cloud hanging over the family.
Similar to David Gergen, Huntsman faced a test of his moral
compass when working in the Nixon administration, shortly before
the Watergate incident. After founding his own company, he was
hired by Elliot Richardson, secretary of Health, Education, and
Welfare (HEW), as associate administrator of social services. Hunts-
man’s success in installing a management-by-objectives program
that saved $100 million in six months brought him to the White
House’s attention, where Bob Haldeman hired him. Huntsman
found the experience of taking marching orders from Haldeman
“very mixed.”
I had been CEO of a company and then was running a big division at HEW. I
wasn’t geared to take orders, irrespective of whether they were ethically or
morally right. We had a few clashes, as plenty of things that Haldeman wanted
to do were questionable. An amoral atmosphere permeated the White House.
One day, Haldeman asked Huntsman to help him entrap a
California congressman who had been opposing a White House
initiative. The congressman partially owned a plant that reportedly
employed undocumented workers, and Haldeman wanted to gather
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information that could be used to embarrass him. Huntsman said, “I
was under the gun from Haldeman to call my plant manager and
place some Latino employees from his facility on an undercover
operation.”
There are times when we react too quickly and fail to realize immediately what is
right and wrong. This was one of those times when I didn’t think it through. I
knew instinctively it was wrong, but it took a few minutes for the notion to
percolate. After 15 minutes, my inner moral compass enabled me to recognize
this wasn’t the right thing to do. Values that had accompanied me since childhood
kicked in. Halfway through my conversation with our plant manager, I said to
him, “Let’s not do this. I don’t want to play this game. Forget that I called.”
I informed Haldeman I would not have my employees spy. Here I was
saying no to the second most powerful person in the country. He viewed
responses like mine as signs of disloyalty. I might as well have been saying
farewell. I left within six months.
After resigning from the White House staff, Huntsman and his
wife, Karen, faced a different type of values test when their youngest
son, Mark, was born with severe cognitive disabilities. Mark’s doctor
told the Huntsmans their son would not be able to read, write, or go
to school, because his mental capacity would never go beyond that of
a 4-year-old. The doctor recommended Mark be institutionalized,
which represented an impossible values conflict for the Huntsmans.
Family was everything, and Mark was just as much a part of the
family as the other children. Jon and Karen decided that whatever it
took, Mark would live at home.
When Penny and I visited the Huntsmans to tour their cancer
institute in 2002, Jon proudly introduced us to Mark, who greeted us
with a friendly smile and a big hug. “Mark doesn’t know what people
do for a living, and can’t tell a custodian from a CEO,” Huntsman
told us.
He judges people only by the goodness of their heart. He sizes up individuals
quickly and spots phonies immediately. If their heart is good, he gives them a big
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hug. Every day, I learn from watching him. He has been the role model and
anvil of our family.
In 2001, Huntsman faced the biggest challenge of his career.
Because of a deep recession in the chemicals and packaging market,
his company was on the verge of bankruptcy. Prices and profit
margins were falling rapidly, just as energy costs and raw material
prices were spiraling out of control. As a consequence, Huntsman’s
bonds were trading at 25 cents on the dollar.
On a somber day, financial experts, lawyers, representatives of
his 87 lenders, and bankruptcy experts from New York City and
Los Angeles gathered in Salt Lake City and presented Huntsman
with their unanimous opinion. He had but one choice: Seek a
court-supervised Chapter 11 bankruptcy or sit helplessly by as
creditors shut the company down altogether by refusing to ship
vital raw materials.
Listening patiently to their analyses and entreaties, he thought to
himself, “I will not let this company be seized by corporate lawyers,
bankers, and highly paid consultants. Not one of them can compre-
hend my notions of character and integrity.”Huntsman answered in
a single word: “No.” To him, bankruptcy was not an option. His
name was on the door—and on the debt. He believed his integrity
was at stake.
There are times when consultants, lawyers, and outside advisers would like to
tell us how to run our lives. Are we people of character, integrity, kindness, and
charity, or are we going to be motivated by what somebody else says? At the end
of our life, we have to determine what we want said at our funeral.
Huntsman called his team together in this dark hour and told
them:
We are going to make it. Our name is on the door. We will go to every one of
our 87 bankers, and carve out deals that we can live with. We will bring in our
bonds and redeem them for equity.
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The company went through three years of turmoil, while Hunts-
man refused to give in. His wife’s support proved essential.
You have to have someone next to you who is tremendously sympathetic. My
bankers and close associates abandoned me, so for years Karen was the only
one there for me. She knew me best and understood how critical it was to me to
maintain my integrity. If one person lost one penny anywhere along the line, I
would have lost my character as a man.
During the process Huntsman had a heart attack and contracted
Addison’s disease—perhaps because of his run-down immune sys-
tem. However, he said with pride:
I repaid every single debt. As of today, the bondholders have been paid
100 cents on the dollar. Huntsman’s creditors have been paid in full and
have extended us more credit. Huntsman stock is doing well, and our earnings
are the highest in history.
Reflecting on his financial crisis, Huntsman commented, “Build-
ing goodwill, being honest and kind, and paying your bills along life’s
pathway will serve you when you’re down and out.”
There are times in our lives when we have to ask ourselves, Are we going to let
this erosion of our life happen, or are we going to step up and change it? Your life
speaks for itself. If I had tried to cheat somebody during my lifetime or did not
play by rules, they would have exercised their natural rights when I got in trouble.
Do you know how you will respond in similar situations? What
do you stand for in your life? Once you know that, it is essential to be
true to what you believe. The only way to prepare for crises like these
is to understand your values and then apply them in practice. For
living by his principles, his outstanding business success, and his
generous philanthropic contributions, Huntsman was awarded the
prestigious Bower Award for 2015 by the Franklin Institute, given
annually to America’s top businessperson.
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Sallie Krawcheck: Putting Clients First
Sallie Krawcheck has often been called Wall Street’s most powerful
woman. She served as Citigroup’s CFO and president of the Global
Wealth & Investment Management division of Bank of America,
the world’s largest investment management business that includes
Merrill Lynch and U.S. Trust. Krawcheck’s values are driven by
placing clients’ interests first. She said:
In the wealth management business, you have the ability to sit down with
families, put together plans, and help them figure out how to live the life they
want to live. This matters enormously to people. There’s a mission to this, and
it’s a noble calling.
She has few kind words for Wall Street culture, though, saying
that short-term financial pressures have destroyed the financial
industry’s focus on its mission. As CFO, she watched analysts roll
their eyes if the CEO wasn’t talking about how he would beat the
quarter. Hedge funds and mutual funds were rapidly trading in and
out of stocks with short-term focus.
The financial services industry had the opportunity to make an enormous
difference, but it got caught up in a game where this is the most important
quarter in the history of the universe; we need the stock to go up. That’s what
they’re focused on, not the ultimate mission.
As the head of Citigroup’s Smith Barney wealth management
business during the financial crisis, Krawcheck advocated returning
client funds on certain products. She bluntly asserted that Citi had
broken clients’ trust by pushing low-risk alternative investments that
were actually high risk. Vikram Pandit, Citi’s CEO, vehemently dis-
agreed.Krawcheck took her argument to the board of directors, saying:
This is going to hurt the quarter, but we are going to have a more valuable
company in the long run. If we don’t do it, clients are going to be angry and they
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should be. They’re going to leave us and they should. We can do well and make
money but not every quarter. We must have a long-term perspective.
Krawcheck asserted that refunding a portion of clients’ losses was
the right thing to do because it demonstrated the bank placed their
interests first. The board sided with her, but Pandit fired her months
later. Krawcheck said she knew taking this stand would get her fired.
Asked if she ever regretted taking such controversial positions, she
laughed and said, “My ability to see things differently is also why I
was able to succeed.”
Krawcheck’s resume positions her as the consummate insider,
but she has an outsider’s mentality. She thoughtfully assesses each
situation against her values. She had the courage to put her job on
the line to be true to her values. She paid a high price, as her
dismissal from Citi illustrates, but she sleeps well every night.
Keith Krach: When Values Conflict
You may not know for certain what your values are until you find
yourself under the pressure of having your values in conflict or you
find the values of the people with whom you work differ from
your own.
The latter was the situation DocuSign CEOKeith Krach faced in
his early thirties following a successful experience at General Motors
(GM), where he was the youngest vice president ever. Krach left GM
to become COO of a Silicon Valley startup named Qronos Tech-
nology with the promise of becoming CEO within a year. “It was like
running the hundred-yard dash and getting smacked in the face with
a two-by-four,” he said.
The company didn’t have the same values I had. The CEO used to say, “Let’s
hide this from the board.” After a few months, it was crystal clear that I had
made a mistake. With its values, the company was never going to survive.
Although I had never resigned from anything in my life, I realized that if I stayed
there much longer, I wouldn’t be able to look myself in the mirror.
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Krach prided himself on being loyal and having integrity.
Internally, he wrestled with the conflict between these values and
his desire to conduct business transparently. His best friend told him,
“You don’t look good. If you have your attitude and enthusiasm,
you’re an A-plus performer. But you’ve lost it. You’re like a D-minus.
There is no in-between for you. You should quit.”
The moment of reckoning came when Krach’s wife was giving
birth to their first child. Krach was at her side during labor, yet the
CEO kept calling, demanding that he come to work. “We have a big
partner meeting with IBM,” the CEO told him. Krach responded,
“That’s anatomically impossible. I’m going to see my son born.”
After a few minutes, Krach reached clarity in his mind. He called his
boss back and said simply, “I quit.”
That was a big moment in my life. I immediately felt a sense of relief. I learned
more at Qronos about what’s important in terms of values, trust, and integrity.
It was like a process of tempering steel that made me much more resolved about
my values.
Now CEO of DocuSign, the rapidly growing online document
signing service, Krach is able to employ the values he has held his
entire life.
Setting Ethical Boundaries
Your ethical boundaries set clear limits on what you will do when
you are tempted or under pressure or when you start rationalizing
marginal decisions. If you establish clear boundaries early in life, your
moral compass will kick in when you reach your limits and tell you it
is time to pull back, even if the personal sacrifices may be significant.
That’s what Enron leaders Ken Lay and Jeff Skilling lacked as they
lurched from deal making into dishonesty. Ultimately, they made a
series of aggressive accounting decisions to inflate short-term profits.
A rising stock price rewarded them for making these marginal
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decisions. Because they lacked clear ethical principles, nothing
counterbalanced their growing greed.
One way leaders can stress test whether their actions exceed their
ethical boundaries is to use the New York Times test. Before
proceeding with any action, ask yourself, “How would I feel if
this entire situation, including transcripts of our discussions, were
printed on the front page of theNew York Times?” If your answers are
negative, then it is time to rethink your actions. If they are positive,
you should feel comfortable proceeding, even if others criticize your
actions later. When you operate with integrity, you will be comfort-
able having the media, your family, or other people you value
examining your words and actions.
Judy Haberkorn: Transparency Is the Right Thing to Do
Verizon’s Judy Haberkorn operated with a clear principle in dealing
with customers: “Always be open and transparent.” That principle
was tested when one of her people made a significant mistake, one for
which Haberkorn thought she herself might be fired. Attempting to
save money, an employee sent consumers their telephone personal
identification numbers (PINs) in unsealed envelopes. The envelopes
wound up in building lobbies below the mailboxes, where anyone
could steal the customer’s name, phone number, and PIN.
When she took the issue and her concerns to her boss,
Haberkorn was told not to worry. “It will die down,” he said.
Frustrated, she responded, “This is a test of how to handle a disaster,
much like Johnson & Johnson [handled] Tylenol.”
If you don’t want to do this the Tylenol way, then fire me right now and put
somebody else in this job. As long as I’m in charge, we’re going the Tylenol
route. I am sending a telegram to every one of our customers explaining what
happened. We will pay for any calls made inappropriately as a result of this
disaster, and immediately give customers a new calling card number and PIN. I
will be on the local news shows tonight to explain what happened and what
Verizon will do.
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As a result, the issue went away. Reflecting on her experience,
Haberkorn noted:
It cost us some money, but there was no doubt in anybody’s mind that we did
the right thing. A mistake happened, and it was costly. To have our customers
feeling we didn’t care about their security and were careless with their privacy
would have been a far greater disaster.
It isn’t easy to take on your boss. For Haberkorn, her principles of
how to treat customers were worth challenging her boss and taking
the corrective action anyway. Her actions took a lot of courage, the
mark of an authentic leader.
Values Challenges at Medtronic
Medtronic founder Earl Bakken first exposed me to Medtronic’s
values before I joined the company in 1989. For the next 13 years, we
used the company’s values to unify employees around a common
purpose and philosophy of doing business.
At first, we had some employees in the international division
who did not take us seriously and continued to do business according
to local practices. Internal audit reports turned up repeated viola-
tions of company standards in these countries. I decided we had no
choice but to make significant management changes. Rather than
focusing on lower-level employees, we started by replacing the heads
of international, Europe, Asia, and Latin America with leaders who
were committed to leading by values.
When violations were uncovered, we made public statements
about what had happened and what actions the company was taking.
The new international leaders gave us the confidence that we could
expand the business rapidlywithout constantlyworrying about ethical
violations. When the company went through a rapid growth phase in
the 1990s, the leading-by-values philosophywas an invaluable tool for
introducing new employees to the company’s culture.
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These days, Medtronic is expanding rapidly in international
markets under the leadership of CEO Omar Ishrak, who was born in
Bangladesh. Ishrak is using the company’s solid system of values as its
basis for expansion in China, India, and Latin America.
As we search for our True North, it is important to acknowl-
edge just how easy it is to get pulled off course. The pressures to
perform, our ingrained fear of failure, and the rewards for success
can cause us to deviate from our values. By knowing our ethical
boundaries and testing our values under pressure, we are able to
stay on track.
Exercise: Practicing Your Values and Principles
1. List the values that are important to your life and your leadership.
After you have done so, go back and rank them in order of their
importance to you.
2. Recall a personal situation in which your values conflicted with
each other. How did you resolve this conflict? How pleased were
you with the outcome?
3. Recall a situation in which your values were tested under pressure.
a. To what extent did you deviate from your values under that
pressure?
b. What resources did you call upon under this pressure?
c. What would you do differently if you had to do it all over
again?
4. List the leadership principles you use in leading others. Then go
back and rank them depending on which are most important to
you.
5. Recall a situation in which you deviated from your True North
and your values to achieve your goals.
a. How will you handle this situation if you face it in the
future?
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b. How can you sense “the slippery slope” of minor deviations
leading to major ones later on?
c. When you find yourself being pulled away from your True
North, how do you get back on track?
6. List the ethical boundaries that you will not cross.
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6
SWEET SPOT
I get to do what I like to do every single day of the year. I
tap-dance to work, and when I get there, I think I’m
supposed to lie on my back and paint the ceiling. It’s
tremendous fun.
—Warren Buffett, CEO, Berkshire Hathaway
In this chapter, we will explore how to find your sweet spot, the
intersection of your motivations and your greatest strengths. When
you are operating in your sweet spot, you feel inspired to do great
things and confident that you can accomplish them because you are
using your strengths. Having an awareness of what motivates you
and understanding your strengths and weaknesses enables you to
discover your sweet spot. When you do, you create a powerful
flywheel that enables you to be both successful and fulfilled.
Operating in your sweet spot, you are aligned with your True
North and have the greatest opportunities to make a difference in
the world.
Warren Buffett Finds His Sweet Spot
No leader is clearer about his sweet spot than Warren Buffett is,
and no businessperson in the past century has been more successful.
Through his stewardship of Berkshire Hathaway, he has created
hundreds of billions in value for his shareholders since 1965.
Despite delivering the most spectacular performance of any
investor in modern history, Buffett has retained his modesty and
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humility. In person, he is remarkably open, without a touch of
arrogance. At age 85, Buffett is still in his sweet spot: motivated by
investing, not for the money per se, but for the thrill of using his
strengths to build great companies.
In 2006, Buffett shocked the world when he announced he
would contribute the vast majority of his fortune to philanthropic
causes, outsourcing the management of more than $30 billion to his
friend Bill Gates. The gift doubled the Gates Foundation’s philan-
thropy in health care and education. Explaining the gift, Buffett said
his skill lies in making money, not giving it away. Characteristic of
Buffett, he sought someone he trusted to manage this benevolence,
insisting that a minimum of $1.5 billion be given away each year.
In spite of his power and the demands on his time, Buffett is a
relaxed and kind person. MyMBA student Vitaliy Pereverzev told me
about his experience with Buffett when he traveled to Berkshire
Hathaway, Buffett’s company in Omaha, Nebraska, at Buffet’s invita-
tion with 80 members of his investment club. After lunch at Buffett’s
favorite restaurant, Pereverzev realized he had left his camera back at
theBerkshireHathaway offices.Rather than sending a staff personback
to get it, Buffett offered Pereverzev a ride in his Lincoln Town Car.
Buffett immediately offered the young Kazakhstani some advice.
“Vitaliy, you have to do what you love. I do not want to live like a
king. I just love to invest,” Buffett said. “Money aside, there is very
little difference between you and me in terms of lifestyle. I eat simple
meals. I drive a regular car. I make decisions and, yes, I too make
mistakes.” Buffett went on to describe his childhood and what it was
like working in his grandfather’s grocery store.
Shortly before reaching the Berkshire headquarters, Buffett
offered the young student concluding advice: “Be a nice person,
Vitaliy. Look around at the people you like. If you like traits of
other people, doesn’t it follow that other people would like you if
you have those same traits?” This sage counsel is typical Buffett.
His lessons are simple, though rarely easy. Given his remarkable
success over the past 60 years, it is surprising how few people follow
his admonitions and his investing strategies.
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Buffett also generously shares his advice with new CEOs. Anne
Mulcahy told me about her interaction with him shortly after
becoming COO of Xerox in 2000. Facing a liquidity crisis as
$18 billion in debt matured, Mulcahy faced overwhelming pressure
from bankers, lawyers, and financial advisers to declare bankruptcy.
Determined to save the company she loved, she made a cold call to
Buffett, who invited her to visit him in Omaha.
Mulcahy later said her ulterior motive was to get Buffett to put
money into Xerox, in spite of his well-known aversion to investing in
technology companies. The advice she received from Buffett proved
even more valuable. After two hours of conversation, Buffett said:
You’re thinking the investors, bankers, and regulators are the people you need
to survive. Put them aside and give priority to talking to your employees and
your customers about what is wrong and what you have to do to fix it.
For the next six months, Mulcahy did just that as she toured the
country, rallying support for the changes required to restore the
company. Meanwhile, Xerox stock continued to decline, but she was
unfazed. Buffett’s advice proved valid. Mulcahy warded off bank-
ruptcy, paid down $10 billion in debt, and continued to invest in
research and development.
Finding His Sweet Spot
Born in Omaha, Buffett made his first stockmarket investment at age
11. As a teenager, he read Benjamin Graham’s seminal book on
value investing, The Intelligent Investor. Graham’s thesis was to value
stocks based on the company’s business fundamentals. When the
stock market traded away from the company’s fundamental value,
opportunity existed. After graduating from the University of
Nebraska, Buffett went to Columbia University to study economics
under Graham.
Although Buffett loves investing, his first full-time job as a
stockbroker tortured him because brokers were rewarded for
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networking and selling, neither of which was his strength. He felt
conflicted because he could generate commissions only by pushing
clients to trade actively, even when it was against their interest.
Instead of trying to turn himself into a master broker, he spent
extraordinary amounts of time on fundamental analysis of stocks.
WhenGraham offered him a job at his firm, Buffett jumped at the
opportunity, without even asking about the salary. He served as
Graham’s apprentice for several years before Graham decided to
wind the firm down. Rather than work for someone else, Buffett
moved back toOmaha and opened his own investing firm at age 26—
an act of high self-confidence in that postwar era. This bold move
positioned Buffett at the intersection of his motivations and his
greatest strengths—his sweet spot.
Buffett has exceeded his mentor in many ways. His investment
philosophy has evolved from focusing on cheap stocks to identifying
companies with a sustainable competitive advantage and high-
quality leadership. Buffett does only friendly acquisitions and brings
a partnership spirit to working with executives of the companies he
has acquired. A master evaluator of people, Buffett asks his partners,
“Do you love the business, or do you love the money?”He only wants
those who love the business.
Buffett versus Wall Street
Across seven decades, Buffett has consistently built his initial capital
base from thousands of dollars into a personal fortune worth more
than $60 billion. He operates from a basic set of principles, which
any long-term investor can emulate. His remarkable success lies in
the unique manner in which he has aligned his personal and
professional abilities with his company’s focus.
In sharp contrast with Wall Street, where hedge funds charge
2 percent annually for managing money and take 20 percent of the
gains, Buffett charges no fees to his investors. As the funds churn
their investments ever faster, Buffett says his preferred holding
period is forever. He has proved the wisdom of his philosophy with
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long-term gains in companies such as American Express, Wells
Fargo, and Coca-Cola.
Whereas activist investors pressure boards to fire CEOs who
don’t produce short-term results, Buffett has a nearly perfect record
of retaining the leaders of his companies. His philosophy promotes
full transparency, in contrast with hedge funds that fight to keep
their investors and investments confidential. Buffett’s famous
shareholder letters contain the bad news along with the good,
as he painstakingly points out his mistakes, often with a bit of self-
directed humor.
During the 1990s boom in technology stocks, Buffett patiently
outlasted his critics by avoiding the Internet stampede and continued
to invest in value companies run by competent executives. At the
1999 Microsoft CEO Summit, I listened as he calmly explained to a
leading Internet CEO that there was no amount of growth that could
make his stock worth 100 times earnings. True to his prediction, the
stock collapsed within the year and never regained its full value.
Wisely, Buffett also avoids his weaknesses. Often verbally
attacked by his mother when he was a child, he has little interest
in fighting with others. If he smells conflict in a deal, he avoids it. He
also steers clear of hands-on management. Company leaders are
welcome to call him for advice, but he places responsibility for
decisions squarely on their shoulders. Because of Buffett’s philoso-
phy, Berkshire Hathaway’s returns have more than doubled the
Standard & Poor’s 500 Index for the past 40 years. To put that
success in context, Buffett has created twice the shareholder value of
Goldman Sachs and Morgan Stanley combined with 24 people in a
5,000-square-foot office in Omaha.
Each March, more than 30,000 people make the three-day trek
to Omaha for Berkshire Hathaway’s annual meeting, known as
“Woodstock for Capitalists.” They hear Buffett and Vice Chair
Charlie Munger take questions for four hours. Buffett said, “Berk-
shire is my painting, so it should look the way I want it to when it’s
done.” His fondest hope is that Berkshire’s success and adherence to
his principles continue long after he passes from the scene. He noted,
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“I’d view it as a tragedy if someone whose achievement was issuing
the most junk bonds or having the silliest stock price took over the
company, and all we’ve built evaporated.”
Buffett is as remarkable for his humility as he is for his wisdom.
He stays grounded in his values and thus eschews the temptations of
the hot-money crowd. Buffett still lives in the Omaha house he
bought for $31,500 in 1956, eats burgers and steaks at Gorat’s, and
drives an older car. He does fly privately, but he humorously named
his first planeThe Indefensible. When I have been with him, I had the
distinct feeling his modesty and staying true to his roots were at the
core of his success.
Having served on more than 20 corporate boards, Buffett also
understands the responsibilities of sound corporate governance.
When Salomon Brothers was embroiled in a major scandal with
the U.S. Treasury Department, Buffett stepped in on a Sunday and
took over as interim CEO. He saved the firm by offering federal
investigators full disclosure and waiving attorney-client privilege,
thus enabling Salomon to avoid a crippling criminal indictment.
He told employees, “You don’t need to play outside the lines. You
can make a lot of money hitting the ball down the middle.”
I had dinner with Buffett shortly after he fired David Sokol,
a close Berkshire Hathaway colleague rumored to be named as his
successor, for insider trading of Lubrizol stock. When I asked him
how he felt about Sokol’s betrayal, he replied, “I believe in trusting
people. Occasionally, someone will violate my trust, but on balance I
am better off in continuing to trust others.”
Intrinsic and Extrinsic Motivations
To deliver high performance, leaders need to sustain high levels
of motivation, just as Buffett has done. There are two types of
motivations—extrinsic and intrinsic (see Figure 6.1). Extrinsic
motivations, such as getting good grades, winning athletic com-
petitions, or making money, are measured by the external world.
Nearly every leader has had a strong achievement orientation since
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childhood.Many competed in athletics in their youth and excelled in
school. After graduating, many young leaders want a job with a
prestigious organization. Eventually, their extrinsic motivations
take the form of wealth accumulation, power, titles, elevated social
status, and prestige.
Although they are reluctant to admit it, achieving success as the
outside world defines it motivatesmany leaders. They enjoy the feelings
of recognition and status that come with promotions and financial
rewards. This cycle starts at an early age. However, each success leads to
a desire for more money, fame, or power. That’s why many people with
great wealth and power are always comparing themselves with those
who have more. Being driven entirely by extrinsic motivations is a
dangerous trap that can lead you astray from your True North, as it did
for Rajat Gupta and Lance Armstrong.
Intrinsic motivations are derived from your deepest inner desires,
not the world’s adulation. They are the basis for your True North and
are closely linked to your life story. Examples of intrinsic motivations
may include personal growth, helping other people, taking on social
causes, creating great products or services, and making a difference in
the world through your efforts.
Because modern society has placed unprecedented attention on
visible achievements, extrinsic measures of success cause many
leaders to seek the world’s acclaim rather than pursue their inner
motivations. The pressure starts early, when college graduates
compare salaries. It evolves as they compare apartments or new
home purchases. Alan Horn, chairman of the Walt Disney Studios,
Figure 6.1 Extrinsic and Intrinsic Motivations
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which includes Pixar, Lucasfilm, and Marvel, described how he
consciously avoided these traps:
Early in your career, the incremental dollar can change the incremental quality
of life because it enables you to buy a better car or better house. At some point,
the incremental dollar does not change the quality of life at all. In fact,
incremental purchases just increase the complexity of life, not its enjoyment. I
don’t want more things because they simply wouldn’t make me happier.
Debra Dunn, who has lived in Silicon Valley for decades as a
Hewlett-Packard executive, advised emerging leaders to beware of
getting caught up in social, peer, or parental expectations:
The path of accumulating material possessions is clearly laid out. You know
how to measure it. If you don’t pursue that path, people wonder what is wrong
with you. The only way to avoid getting caught up in materialism is to
understand where you find happiness and fulfillment.
Finding Your Sweet Spot
The term sweet spot describes your motivated capabilities when your
motivations and your strengths align (see Figure 6.2). Claremont
professor Mihaly Csikszentmihalyi, a pioneer in positive psychology,
provided us the following advice aboutmotivation: “Find out what you
are good at and what you like to do.” In these two simple dimensions,
Csikszentmihalyi cut through the jargon and summed up what our
interviewees learned through hundreds of years of experience.
Figure 6.2 Finding Your Sweet Spot
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You will be most effective as a leader when you find opportu-
nities that highly motivate you and use your greatest capabilities.
One without the other is insufficient. To find these opportunities,
you must understand your deepest motivations and be honest with
yourself about your capabilities. You won’t be successful as a leader
by pursuing something you’re not good at or by pursuing leadership
roles that don’t motivate you.When you find a role that meshes your
motivations with your capabilities, you will discover the sweet spot
that maximizes your effectiveness as a leader.
Exploring Warren Buffett’s Motivations
Applying this framework to Buffett, we clearly see extrinsic and
intrinsic motivators at work in his life. Extrinsically, Buffett loves
public recognition and being valued. Moreover, he has used his
media savvy to raise his profile and gain unique access to deals.
However, he is not motivated by accumulating possessions. Intrin-
sically, he is motivated by learning and teaching, sharing his
knowledge through frequent media interviews, lengthy annual
letters, and discussions at Berkshire’s annual meetings.
The combination of these motivations has served Buffett well
during challenging times, and has enabled him to become known as
America’s most trusted investor. During the financial crisis, leading
firms, such as Goldman Sachs and General Electric (GE), turned to
Buffett for investments and his stamp of approval. He has designed
his life to take advantage of his strengths and focus on his motiva-
tions. No wonder he tap-dances to work each day!
Tracy Britt: Heeding Your Call
Often leaders who pursue their intrinsic motivations end up achiev-
ing the most. Tracy Britt, who worked for Warren Buffett as his
financial assistant, illustrates this paradox of motivation. Britt grew
up working long hours on her family farm in Kansas and became one
of Harvard Business School’s youngest graduates. Friends describe
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her as kind and honest. In my classroom, she had a grounded
approach to looking at issues, recognizing the human dimension
of business problems.
While still in school, she formed an unlikely friendship with
Buffett. Britt dreamed of finding an investor with a long-term focus
who would mentor her. They first met when she brought a group of
students to Omaha, and thereafter she continued to correspond with
Buffett. She also volunteered to help him on projects, such as reading
the Lehman bankruptcy filings. Although she took a job at Fidelity
upon her graduation, they continued to correspond.
Britt voraciously read everything she could about Buffett and
relished opportunities to learn from him. As he got to know her, he
sensed her talent and integrity. Eventually he asked her whether she’d
be interested in moving to Omaha to join Berkshire. Britt didn’t
hesitate, saying yes without asking for details on her title or compen-
sation. Five years later, Britt oversees investments worth billions, sits
on the board of Heinz, and is chair of four Berkshire portfolio
companies. Recently, Buffett asked her to be CEO of a Berkshire
subsidiary, Pampered Chef. Only 30 years old, she has been profiled in
Fortune and theWall Street Journal, but it hasn’t gone to her head. Her
greatest joy comes in learning from the master.
Kevin Sharer: Discovering His Sweet Spot
Kevin Sharer is a talented leader who lost his way when he let his
extrinsic ambitions to be CEO at a young age take him away from his
sweet spot. Yet he learned from his experiences and found his sweet
spot at Amgen, where he had two spectacular decades of leadership.
His experiences with the navy andMcKinsey prepared Sharer for the
bare-knuckle intensity of the GE environment. His success at GE
led to his first general management opportunity while he was still
in his midthirties.
In 1989, Sharer encountered the most difficult situation of his
life. Having succeeded at everything he had done, he was facing
failure for the first time. A rising star at GE, he was eager—too
eager—to get to the top. By age 40, Sharer ran GE’s satellite business,
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was elected a corporate officer, and was promoted to the jet engine
business. This would be heady stuff for anyone but especially for
someone as ambitious as Sharer. When the headhunters came
looking for a new head of sales and marketing for MCI, he seized
the opportunity to leapfrog his career.
“The CEO race is wide open,”MCI’s vice chairman assured him.
Sharer took the bait. This time, however, things did not go his way.
Upon joining the company, Sharer learned the COO was in line for
the top spot and didn’t welcome competition, especially from the
ambitious, young GE hotshot.
Sharer wasted no time in developing his strategy to transform
MCI and position himself for promotion. Within six weeks,
he concluded that the company’s geographic marketing organiza-
tion was improperly structured. “I was at the zenith of my arrogance
at that time,” Sharer said. “I marched into the chairman’s office
and proposed restructuring MCI’s sales organization.” His proposal
was threatening to senior executives who had spent their careers
building MCI. Lacking telecommunications experience, Sharer
found he had little credibility within the organization. Having
succeeded at everything he had done, he was facing failure for the
first time.
“MCI was a crucible for me,” Sharer observed later. “I learned
that whether you are right or not, there is a price to be paid for
arrogance.” He also found out his style did not suit MCI’s hyper-
competitive culture. “People were personally competitive in a way
that was inconsistent with my values,” he explained.
The internal competition was mean-spirited and at your throat. It was
eating me up as I was becoming less effective and less committed to the
company. If your values are not consistent with the people you’re working with,
you should not be there.
Desperate to escape from MCI, Sharer telephoned CEO Jack
Welch and asked to return to GE. Welch wasn’t happy with the way
Sharer had bailed out afterWelch had created so many opportunities
for him. “Hey, Kevin, forget you ever worked here,” Welch replied
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and hung up the phone. “At that moment,” Sharer recalled, “I knew
I had been cast adrift in a lifeboat.”
I realized I had tomake a go of this big operating job. I couldn’t just bail out. It was
a gut-wrenching two years for me, the most challenging and unhappy time of my
professional life. I’m not a good knife fighter, and I was getting outmaneuvered.
At first I went into denial. Then I became defeatist and cynical.
It was grinding me down, and I began to retreat emotionally. My wife
could not understand what I was going through because she had no corporate
experience. She feared I would be fired, which only added to my feeling of
isolation. Without question, it was the toughest time of my life.
Sharer’s story of abandoning his sweet spot parallels the difficul-
ties that many leaders face. Their egos tempt them into situations
that don’t play to their strengths and don’t inspire them. If they have
self-awareness and insight, they readjust their compass to get back on
the track of their True North and find opportunities where they can
operate in their sweet spot.
Sharer’s crucible at MCI proved invaluable. It humbled him,
forcing him to control his ego and recognize there is more to life than
just grabbing the next promotion. Caught up in the glamour of being
a rising star, Sharer was brought down to reality. Two years after
joining MCI, he received a letter asking whether he knew anyone
who could be president of Amgen. Never having heard of the
company, he went to the public library to learn about it. He decided
to nominate himself for the job and was offered the position, under
the tutelage of CEO Gordon Binder.
Having learned a painful lesson atMCI about being perceived as a
know-it-all, he recognized he knew nothing about the biotechnology
business. “If I hadn’t had that chastening experience at MCI,
I could easily have blown up at Amgen,” he said.
My last brush with health care had been ninth-grade biology, so I asked one of
our scientists to teach me biology. By being patient, I became an insider before I
started making changes. I learned the business from the ground up, made calls
with sales representatives, and showed my desire to learn.
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In contrast with his earlier experiences, Sharer patiently under-
studied Binder for seven years. This time around, he avoided the
seduction of the headhunters, telling them being number two at a
rapidly growing company like Amgen was “better than anything else
that was on the plate.” A year before Binder’s retirement, the board
told Sharer, “Look, Kevin, you’ve got the job. For the next year spend
your time learning R&D.” Sharer studied theAmgen research process
from the groundup,working in its labs, being tutored by scientists, and
visiting competitors’ research facilities.
When the board announced Sharer would become CEO, he met
individuallywiththetop150peopleinthecompany.Their feedbackgave
Sharer a thorough picture of what the company’s top leaders wanted.
These interviews were the single most important thing I did upon becoming
CEO. They gave me the mandate to create a shared reality for the company.
That enabled people to align around the new vision and strategy for building
Amgen for the next 10 years.
Kevin Sharer’s searing experience at MCI enabled him to under-
standhis strengths andmotivations. By learning from theMCI debacle,
he recognized changes he needed tomakewhenhewent toAmgen.He
learned the business before taking charge, listened to the wisdom and
experience of his colleagues, and was patient in reaching his goal. As a
result, he ledAmgen for a decadewith spectacular success, transforming
the company from a two-drug firm to a highly innovative organization
that continues to produce breakthrough drugs from its labs.
Looking back at his MCI experience, Sharer reflected, “We are
the mosaic of all of our experiences.”
In retrospect, the MCI experience wasn’t all bad. I discovered what a truly
competitive company can do, and learned about entrepreneurship and innova-
tion. A tough experience like that gives you genuine empathy for other people.
It is vitally important that you love what you do because if you don’t, you won’t
do your best. When I was at MCI, I never had an emotional connection
with low-priced long distance. If somebody walks up to you and says, “Your
product saved my life,” the power of that connection is enormous.
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Avoiding the Trap of Extrinsic Motivations
Moving away from the external validationof personal achievement isn’t
easy. Achievement-oriented leaders grow so accustomed to successive
accomplishments in their early years that it takes courage to pursue their
intrinsic motivations. But at some point, most leaders recognize they
need to do what they love rather than achieving external acclaim.
Many leaders we interviewed turned down higher-paying jobs in
early career decisions to pursue roles theywere passionate about. In the
end, they came out ahead—in both satisfaction and compensation—
because they were successful in doing what they loved. Time Inc.
CEOAnnMoore had a dozen job offers after business school and took
the lowest-paying one—with Time magazine. “I had student loans
hanging over my head, but I took the job because I loved magazines.
At the time nobody in my class understood why I made that choice,
but at our twenty-fifth reunion they understood completely.”
Ann Fudge also took the lowest-paying offer she received out
of business school. She explained, “You can’tmake career decisions just
based on money. I hoped the money would come, and it did. If I had
made my career decision based on the money, I would have been on a
totally different career path.” Jean-Pierre Rosso recalled, “I always
focused on being happy in what I was doing. If I was motivated and
did my job well, I knew the money would follow.”
When Dave Cox was CEO of Cowles Media, a Stanford Business
School student told him, “Maybe I have to get my satisfaction
someplace else and just do the business part to makemoney.”Amazed
by the comment, Cox raised his eyebrows quizzically and asked:
Whywould youwant to spend your time doingwork you don’t enjoy?These should
be the best years of your life. There is so much energy that results from feeling
valued and connectingwith your passions. That’s when you add the greatest value.
Balancing Your Motivations
Positive validation by the outside world is a natural consequence for
leaders with high achievement orientation, because they cherish the
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recognition that comes with their accomplishments. It is natural to
seek the esteem of peers, promotions in title, and the financial
rewards that come with success. The danger comes when leaders
become so enamored with these external symbols that they can
never get enough. At this point, they are at the greatest risk of losing
touch with their intrinsic motivations and abandoning things that
give them a deeper sense of fulfillment.
As CEO of Medco, Per Lofberg challenged young business
leaders to think carefully about the lifestyles they choose for
themselves: “It is dangerous to get overcommitted to a high-flying
lifestyle at a young age.” Many young leaders are tempted to take
high-salaried jobs to pay off loans or build their savings, even if they
have no long-term interest in the work. They believe that after 10
years they can move on to do the work they love.
Yet many become so dependent on maintaining expensive
lifestyles that they become trapped in jobs where they are demoti-
vated and unhappy. Locked into the high-income and high-expense
life, they cannot afford to do work they love. That holds a lot of
people back from pursuing what brings them satisfaction and
realizing their greatest potential.
Many leaders have learned the hard way that external
recognition can be a fickle lover. When things do not go
their way, external sources of gratification disappear very quickly.
So do their superficial friends and acquaintances who are more
interested in associating with their success than in supporting
them when things go poorly. The key to developing as an
authentic leader is not eschewing your extrinsic motivations
but balancing them with intrinsic motivations that provide
fulfillment in your work.
Build on Your Strengths
Truly great accomplishments comeonly fromexploiting your strengths.
Many of the most extraordinary people in history were tremendously
flawed individuals. Margaret Thatcher, Mahatma Gandhi, and
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Napoleon Bonaparte all had striking weaknesses, yet they used their
gifts to achieve amazing things through their leadership.
Through intense reflection, Donna Dubinsky came to the real-
ization in her midthirties that she wasn’t playing to her strengths in
her work. She was burned out after 10 years of 80-hour weeks at
Apple and Claris, so she decided to take a yearlong sabbatical to live
in Paris. There she found an apartment, learned to paint, studied
French, and thought about what she would do next.
I reflected on what I am good at, what I’m not good at, and what value I could
bring. I’m not an innovative thinker and never will have the product savvy of
Steve Jobs. In my 10 years in the technology industry, I had never thought of
one big new idea.
As she thought further about her capabilities, she acknowledged
her ability to recognize other people’s good ideas, build strong teams,
and design key business processes. “When I returned to SiliconValley,
I knew I needed a great product person to team with me,” she said.
Eventually she found Jeff Hawkins, creator of the PalmPilot, and she
becamePalm’sCEOin1992.The twohave such complementary skills
that they are considered inseparable business partners around Silicon
Valley and are working on their third venture, Numenta.
When leaders step out of their comfort zones to take on new
challenges, they often discover capabilities they did not know they
had. When we first interviewed Cesar Conde, he was vice president
of Univision, the largest Spanish-language television network in the
United States. After the Castro revolution, his grandparents helped
his mother flee Cuba because they wanted her to have better
chances. At Univision, which employed many first- and second-
generation Hispanic Americans, Conde created similar opportuni-
ties for his coworkers. One day, his boss took him to the company
parking lot and told him, “Fifteen years ago, the parking lot was full
of rickety old cars owned by our employees. With the company’s
success, the cars are new and employees can afford to send their kids
to good schools.”
Conde said, “I can identify with his pride. It is motivating to
realize I have the opportunity to do something great for other
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people.”Conde has since been promoted to executive vice president
of NBC Universal. His internal passions propel his success.
Chuck Schwab’s Journey to His Sweet Spot
Charles “Chuck” Schwab went through some very low moments in
his midthirties. Recently divorced, he experienced a period of deep
uncertainty about what to do professionally. He enrolled in law
school at night in an attempt to follow in the footsteps of his father
and grandfather. After just three weeks, he realized he lacked the
required reading and writing skills and dropped out.
Schwab had struggled with reading all his life, but not until his
early forties did he learn he was dyslexic. Although dyslexia caused
him difficulty in school, he always knew he was good at math. So he
began working part-time for an investment firm and discovered his
interest in investments and his knack for investment research.
Like many leaders, Schwab needed time and experience to
determine what motivated him. Eventually, he turned his passion
for investments into building a company that would democratize the
entire brokerage industry. Schwab’s motivations and capabilities
finally came together when at age 37 he founded Charles Schwab &
Company.
Schwab traces his motivations to his upbringing in the post-
Depression era. Times were tough in the small farming community of
Woodland, California, where he grew up during the 1940s. During
World War II, his family used ration stamps to buy food. Schwab’s
parents struggled their entire lives to be financially independent.
“We were still suffering from the hangover of the Depression years,”
he recalled. “My father taught me the importance of being indepen-
dent. I was motivated to be financially successful because I didn’t
want to have my life limited by resources.”
When the Securities and Exchange Commission (SEC) deregu-
lated brokerage services in the early 1970s, Schwab saw his opportunity
to start a company. Before that time, stock market transactions went
through large brokerage firms that charged fixed fees. Without com-
petitive rates, many Americans could not afford to participate in the
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stock market. In 1974, Charles Schwab & Company entered the
market, reducing brokerage commissions by 75 percent. Before long,
individual accounts such as 401(k)s and individual retirement accounts
(IRAs) were commonplace. “If you knew what you wanted to buy or
sell, we could do it very efficiently.We’d complete the trade for a small
commission without the interference of some hotshot broker.”
The unfairness of brokerage industry practices that existed before
deregulation touched a nerve deep inside him. In his interview,
Schwab’s face reddened and his hands gestured forcefully when he
began talking about how Wall Street brokers took advantage of
average American investors. “I always put the customer on top of a
stool whose four corners are value, customer service, technology, and
best price,” he explained. “Wall Street flips the stool over, sitting on
top of the stool with the client underneath.” Leaning forward in his
chair, he exclaimed, “Letme tell you, it was a denof thieves.Whatever
the dealers wanted, they got.”
In a capitalist society, financial independence is fundamental. We are blessed in
America with economic freedom and freedom of choice. I wanted to make
Schwab a fully democratic place where people could come to us, disclose what
they wanted, and get the best package available at the lowest cost, without the
conflicts of interest so prevalent in the brokerage industry. Wall Street should be
like your doctor, focusing on your interest, not its interests.
Schwab’s strengths, talents, and motivations came together
when he founded Charles Schwab & Company. He combined his
investment research skills with the persistence and resilience learned
from years of suffering with dyslexia. Building a company with a
cause in which he passionately believed, he has helped millions
become more independent while achieving financial independence
himself. His company is an American icon, with 14,000 employees
and a market capitalization of $36 billion.
Schwab’s passion for helping Americans achieve financial inde-
pendence is an intrinsic motivation that in the end made him
wealthy. His life exemplifies the importance of discovering your
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sweet spot. You need to know what motivates you and have a
realistic understanding of your strengths and weaknesses so that you
can put your strongest capabilities to work. When you do so, you will
discover the sweet spot of your motivated capabilities.
Exercise: Your Sweet Spot
The following exercise provides you the opportunity to find your
sweet spot—that zone where you are able to use your abilities to the
fullest and where you are highly motivated.
1. What are your extrinsic motivations? Which of them might
become too dominant for you?
2. What are your intrinsic motivations? How do you ensure you are
giving them priority?
3. Recall and then list one or more instances in which your extrinsic
motivations conflicted with your intrinsic motivations.What did
you do?
4. What are your greatest capabilities? How does your work and life
use them?
5. List your motivated capabilities, areas where you are both highly
motivated and very capable.
6. Envision future situations where you can apply your motivated
capabilities in your sweet spot.
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7
SUPPORT TEAM
If you want to go fast, go alone.
If you want to go far, go together.
—African Proverb
If you were facing a major crisis in your life—such as losing your
job, life-threatening illness, difficulties in your marriage, or death of
a loved one—to whom would you turn? In challenging times, you
need a solid network of trusted relationships with people who are
available to counsel and care for you. Your support team is built
upon long-term relationships and may include your spouse or
partner, family members, best friends, mentors, and a small per-
sonal group.
Your support team has faith in you and understands your True
North. Supporters don’t care about your external successes or fail-
ures, but they do care about you as a person. Having people around
you who support you gives you the confidence to listen to your inner
voice, even when outsiders are attacking or criticizing you. Your
closest confidants give you the resilience to get through hard times
and enable you to recognize what is truly important in life.
Tad Piper’s Support Team in His Crisis
Facing a crisis in his work, Piper Jaffray CEO Tad Piper learned just
how essential his support team was in navigating difficult challenges.
Even Piper is surprised to now find himself a member of three groups
that support each other through life’s difficulties.
Afforded early opportunities for business leadership, Piper was
appointed chief executive of his family’s growing financial services
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firm at age 36. A sophisticated leader, he felt he had little time for
intimate groups because of his hectic life. He noted, “If you told me
20 years ago I would be part of three groups that meet regularly and
talk about things like feelings and God, I would have said, ‘Thank
you, but I don’t do groups.’ ”
Many of us find excuses—I’m too busy . . . The payoff isn’t
clear . . . I’ll do it next year—to avoid building the types of relation-
ships these groups engender. For Piper, the realization that he
needed greater support came after he underwent treatment for
drug dependency. “In treatment, my family had the opportunity
to tell me about how my chemical use was affecting them,” he
explained. “It was horrible.”
Afterward, he joined Alcoholics Anonymous (AA). He noted
about his fellow AA participants, “These are not other CEOs.” Yet
in his AA group he found something far more valuable:
These are nice, hardworking people who are trying to stay sober, lead good
lives, and work with each other about being open, honest, and vulnerable. We
reinforce each other’s behavior by talking about our chemical dependency in a
disciplined way as we go through the 12 steps. I feel blessed to be surrounded by
people who are thinking about these kinds of issues and actually doing
something, not just talking about them.
With the help of AA, as well as his couples group and Bible
study group, Piper rebounded. Although the initial impetus for
joining AA was dealing with his substance abuse, Piper credited all
three groups with transforming his relationships and his life. “Most
of us don’t find the balance we so desperately seek,” he said. “It is
incredibly valuable to be reinforced by others who are wrestling
with similar issues and actually doing something about them.” In his
groups, he learned to open up about the challenges he faced in his
life, in sharp contrast with the many surface-level conversations he
had previously with friends. These days his discussions are far deeper
and more meaningful.
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Founded by Piper’s grandfather over a century ago, Piper Jaffray
faced a financial and legal crisis of monumental proportions in 1994.
As a Piper bond fund increased 90 percent in five years, its star
manager began taking increased risks to sustain returns, using
complex derivative instruments to leverage the portfolio. When
interest rates decreased in 1994, the fund declined 25 percent.
Investors cried foul, and their lawyers went on the attack. Suit
after suit was filed, charging Piper Jaffray with failing to inform
clients of the fund’s risks and with falsely designating the fund as
conservative. Piper tried working with the clients to resolve the
issues, but doing so became increasingly difficult. He found that even
some of his closest friends were turning against the firm. “When you
get into problems,” he pointed out, “you find out quickly how strong
your relationships are, which people are real and which aren’t, and
who will abandon your relationship for money.”
The uproar over the bond fund’s decline placed the firm’s
reputation and financial structure at risk. “We had a 99-year history
of serving clients well and being known for trust and integrity,” he
said. “The mutual funds we positioned as relatively safe, conserva-
tive investments turned out not to be.” When a Wall Street Journal
article estimated potential liabilities from lawsuits was three to four
times the firm’s capital, Piper recognized the company’s future was
in jeopardy. He felt incredible pressure to preserve the firm and his
family’s legacy:
I remember working unbelievably hard for long hours trying to sort through the
possible resolutions. I was feeling helpless and powerless as the problems were
just overwhelming. I was going to let down tens of thousands of clients. I
worried about our 3,500 employees and their families, and all the ramifica-
tions. I kept thinking, “Oh, my God, I can’t do this.”
Fortunately, Piper’s past experience with chemical dependency
taught him how to handle challenging situations. He began by
sharing all his emotions in a long, tearful conversation with his
wife, and then shared the pressures with his closest friends. “Our
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friendships weren’t based on whether I succeeded or failed on this
problem,” he said. Acknowledging to these close confidants that
the situation was out of his control brought Piper a sense of relief.
With their support, he faced his fears and finally accepted his
situation.
Piper’s faith and his relationships brought him a sense of
clarity and peace, instead of making him feel isolated. This inner
assurance proved of paramount importance, because he needed to
maintain the confidence of the company’s employees and clients.
As problems in his asset management division escalated, Piper
needed high performance from his remaining businesses. Because
he had support from meaningful relationships, Piper was willing
to be vulnerable with his senior team, and even with front-line
employees.
Piper said one experience in particular taught him the power of
being vulnerable, something he had never experienced before. “We
brought together our leaders and their spouses from branch offices
around the country,” he explained.
Mywife and I decided to be completely honest with them and totally vulnerable.
We showed them we were real people, feeling just like they were. We stood in
front of them and told them we were scared. I also talked about my chemical
dependency and about my faith. That was the most powerful thing we have ever
done. People never forgot that day because we showed our vulnerability. All of
a sudden everybody on our team trusted us, even the skeptics.
“Most leaders are afraid to be vulnerable,” he said. “They think,
‘I’m supposed to be strong and have all the answers.’ ” Paradoxi-
cally, his vulnerability, honesty, and clarity inspired others to stay
the course. Piper eventually settled the lawsuits and began building
the business once again. Shares rebounded more than threefold
from the 1994 nadir. After the repeal of the Glass-Steagall Act in
1999 permitted commercial banks to acquire investment banks,
U.S. Bancorp acquired Piper Jaffray, providing the latter a broader
capital base.
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Building Support Teams
If you were facing a highly challenging problem like Piper was, whom
would you turn to for support? Many leaders try to hunker down and
fix problems themselves without reaching out for help. Without
confidants to provide perspective in crisis, it is very easy to lose your
way, as Lehman’s Richard Fuld did. That’s a risky course of action,
because during a crisis is when you most need to depend upon people
with whom you have built trusting relationships over a long period.
Leaders do not succeed on their own. The loneliness of leader-
ship has been well documented, but the remedies have not. Every-
one has insecurities; some people are just more open about them
than others. Even the most outwardly assured executives need
support and appreciation. Authentic leaders build close relationships
with people who will counsel them in times of uncertainty, be there
in times of difficulty, and celebrate with them in times of success.
Essentially, leaders facing personal or professional turmoil face
two choices: Wear a mask or reveal their innermost thoughts and
feelings to those closest to them.Many leaders choose to wear a mask
even with their spouses, advisers, leadership teams, and friends. If
you do not reveal your vulnerabilities to these trusted people, giving
voice to your uncertainties and acknowledging your fears as Tad
Piper did, leadership becomes a very lonely place.
Having people in your life with whom you share confidentially
ensures that you will have support when you need it most. Your
support team can provide affirmation, advice, perspective, sugges-
tions for course corrections, and, above all, love. During their most
difficult times, leaders find comfort in being with people on whom
they can rely so that they can be open and vulnerable. During the
low points, they cherish the friends who appreciate them for who
they are, not what they are.
Leaders need a multifaceted support structure that includes their
spouse or significant other, family members, mentors, close friends,
and personal and professional support groups. Their support team
helps them stay on track, especially when outside forces pressure
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them to deviate. Many leaders have built their support networks
over time, as the experiences, shared histories, and willingness to be
vulnerable create the trust and confidence they need in times of
uncertainty. Leaders must give as much to their relationships as they
receive so that mutually beneficial bonds can develop.
The Power of Sharing Openly
One of the greatest gifts you can give yourself and another person is
to build a relationship where you can be completely vulnerable and
open, warts and all, and still be accepted unconditionally. When
someone knows and accepts your weaknesses, your inner fears, and
your struggles, he or she becomes a true partner. Most leaders have
their closest relationships with their spouses or partners. When
leaders feel unconditionally loved by another person, they are
more likely to accept themselves for who they are. This enables
them to become less dependent on external reinforcement.
Paula Rosput Reynolds, CEO of Safeco, found such a person in
her second husband.
When you go home at the end of the day and your employees think you’re a
jerk, or something has gone so wrong it seems hopeless, you’ve got to have
somebody who says, “I love you unconditionally.” I know I can always go
home and my husband will love me.
Your partner is someone who will also hold up a mirror to tell you
the truth in a compassionate way when you have strayed from your
True North. In your partner’s eyes, positions and accomplishments
mean little, but the essence of who you aremeans everything. Because
most leaders face frequent criticism, they may develop protective
armor to combat it.Only thosewithwhom theyhave genuinely loving
relationships can penetrate the armor protecting their core.
Big Brothers Big Sisters’ Judy Vredenburgh and her husband
each have a deep appreciation for the values, character, and
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humanity of the other. She said, “I married someone who is not
threatened by my power or position.”
He made it clear that my position would not give me negotiating strength in our
relationship. He doesn’t care about the things that impress the external world,
but he deeply values my humanity as well as my achievement orientation, my
sense of responsibility, and my values.
Theremay be times, however, when yourmarriage is strained, and
things are not going well at work. In these situations, you need
someone else with whom you can share everything. It could be
your best friend, mentor, another family member, or therapist. The
important thing is not to go it alone in these difficult times. Thosewho
do find it very difficult to maintain their perspective and objectivity.
Most leaders find comfort in being with their families. Younger
leaders maintain close connections with their families of origin,
seeking out opportunities to share high-quality time with siblings,
parents, and grandparents. In knowing their parents at a deeper level
and learning more about their parents’ pasts, they wind up under-
standing themselves better.
As working hours have increased, some leaders have sharply
limited their social lives in order to make time for family. John
Donahoe, eBay president, and his wife imposed a moratorium on
social events so that they could spend quality time with their four
children. When George Shultz was U.S. secretary of state, he and his
wife skipped all Washington social events unless the president or
vice president insisted they attend. Jamie Dimon, J.P. Morgan’s
CEO, said he sacrificed superficial types of social events, such as
attending football games and playing golf, to prioritize time with his
three daughters.
Mentoring: A Two-Way Street
Many authentic leaders have mentors who changed their lives by
helping them develop the skills to become better leaders and the
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confidence to lead authentically. What some people fail to recog-
nize, especially aspiring leaders, is the importance of the two-way
relationship with their mentors. Lasting relationships must flow
both ways.
The best mentoring interactions spark mutual learning, explo-
ration of similar values, and shared enjoyment. If people are looking
only for help from their mentors, instead of being interested in their
mentors’ lives as well, the relationship won’t last for long. Mentoring
is a two-way street in which both people learn a great deal from each
other, and the bilateral connection sustains it.
By mentoring many leaders from the next generation, I have
been able to walk in their shoes, appreciate what’s important to
them, understand their work lives, and see how they are struggling
to live integrated lives. In my relationship with Dean Nitin Nohria,
I have a mentor who is much younger than I am, yet his wisdom has
been invaluable in my 12 years on the Harvard Business School
(HBS) faculty.
As a young entrepreneur building a fledgling company, Howard
Schultz realized he needed someone with whom he could share his
fears and vulnerabilities. When Starbucks had only 11 stores,
Schultz heard Warren Bennis lecture on leadership and said to
himself, “Here is someone I can learn from.”
Who do you talk to when you’re afraid to demonstrate vulnerability and
insecurity to others? You can talk to your wife or close friends, but you also need
advice from someone who has been there before. I asked Warren for his help,
calling him once or twice a month. He taught me that vulnerability is a strength
and a characteristic people value. Demonstrating your values, emotions, and
sensitivities empowers others, as no one is impervious to having doubts.
Many people are afraid to approach potential mentors because
they do not want to impose on others. They fail to realize how
much they can offer to their mentors. Warren Bennis tells young
leaders they have to recruit great mentors. He likens this process to
a dance where the two engage in mutual learning. Reflecting on
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how he developed close relationships with his own mentors, he
recalled, “They appreciated my openness, energy, follow-up, and
discipline.”
When I was in business school, Dean Leslie Rollins took me
under his wing and helped me develop as a leader with heart and
soul, guiding me to understand the deeper purposes of leading in
business and society. He coached me, goaded me, challenged me,
and offered me countless opportunities to develop my deeper
qualities. He made me furious at times, but it was his penetrating
challenges that had long-lasting impact.
Mentors are not necessarily people who make you feel good
about yourself or tell you that you can do anything. Sometimes the
best mentors provide tough love by being critical as a means of
teaching. Kroger’s David Dillon told the story of the mentor he had
early in his career. At age 29, he was named merchandising vice
president (VP) for the Fry’s supermarket division of the Dillon
Company. One day, Dillon got a call from Chuck Fry, the entre-
preneur whose family business Dillon’s company had bought, invit-
ing him to walk through a Fry’s store together. As they stopped in
front of a soft drink display, Fry spent a long time questioning Dillon
about what he saw. Dillon failed the interrogation, because Fry’s
questions showed him he wasn’t observing what was happening in
the store. Fry explained, “The display had not been built with the
customer in mind, but was based on maximizing the vendor’s profits.”
Years later, Dillon learned that the real purpose of Fry’s visit was
to decide whether he was willing to learn from Fry as a teacher and
mentor. If he wasn’t, Fry planned to have him pulled out of his job.
For the next year, Dillon and Fry spent an hour of every day together,
in person or on the phone.
Looking back, I realize I was failing terribly as merchandising VP, but didn’t
even recognize it. It was a very valuable lesson. You can’t put leaders into a
totally foreign job and expect them to perform; you have to teach them the
leverage points of that job. Without Chuck, I would not have succeeded in the
grocery business.
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Dillon’s story illustrates the importance of having mentors who
challenge rather than just support you. Too many leaders prefer
mentors who are always there for them but don’t push them to
change or improve. As a mentor, it is relatively easy to be a good
listener and support other people’s ideas but harder and riskier to
point out their weaknesses and blind spots.
Yet it is also important for your team to know that you will be
there to support it if necessary. Ecolab’s Martha Goldberg Aronson
shared the story of a boss who was willing to bet on her in stretch
roles while supporting her. When she took a new position, her boss
told her:
On certain days you will feel that you’re way out on this limb. The wind is going
to start to blow, and you’re going to feel like the limb is going up and down.
You’re going to hear it crack, and you’re going to come crashing down. That’s
when I’ll be there to catch you.
It wasn’t long before Aronson encountered a quality problem
with her new line of catheters. She noted, “The branch cracked a few
times, and my boss was really there.” Just knowing you have support
from your leaders if things go wrong is very empowering. It enables
you to recognize that you will not be hung out to dry, so you can take
on significant challenges and stretch goals without fear of someone
sawing off the limb behind you.
Mark Zuckerberg’s Mentors Accelerated His Growth
Mark Zuckerberg, founder and CEO of Facebook, is one of very few
people who have turned their idea into more than $100 billion of
market value. Zuckerberg has been supported on his journey by
several mentors, particularly Don Graham, CEO of the Washington
Post Company. Early in 2005, Zuckerberg met Graham, whose
family had controlled the Post for 50 years. Graham’s own mentor,
Warren Buffett, had advised him and helped shape the Post’s focus
on long-term value creation.
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From their first meeting, Graham and Zuckerberg felt an imme-
diate connection. Zuckerberg recalled wanting to emulate Graham.
In turn, Graham was so attracted to the Facebook founder that he
offered to invest in the company on the spot. Zuckerberg verbally
accepted a $6 million investment from the Post, only to later renege
when Accel Partners offered to invest at a significantly higher
valuation. That trying experience actually brought Zuckerberg
and Graham closer together, because Graham was impressed by
the way Zuckerberg balanced his duty to Facebook shareholders and
his desire to do right by Graham.
Later that year, Zuckerberg spent several days shadowing
Graham to learn how CEOs spend their time. Graham counseled
him on key decisions, such as recruiting Sheryl Sandberg as COO.
Graham also encouraged Sandberg to accept the position reporting
to the much-younger Zuckerberg. As their relationship deepened,
Graham sought Zuckerberg’s advice for online initiatives to engage
the Post’s readers.
Zuckerberg’s roster of mentors has evolved as the company has
grown. Early on, he relied on Sean Parker to help him understand
how to attract equity capital while retaining control over his
company. These days, he seeks counsel from Bill Gates and Silicon
Valley venture capitalist Marc Andreessen, but his relationship with
Graham has been constant. Today, Graham is lead director of
Facebook’s board.
Coach Campbell: Silicon Valley’s Leading Mentor
Intuit chairman Bill Campbell is the dean of mentoring in Silicon
Valley. Many venture capitalists and board members in Northern
California will not hire a new CEO without first checking with him.
Although he keeps a low public profile, “Coach Campbell” is one of
Silicon Valley’s most respected executives.
Campbell has mentored dozens of entrepreneurs and business
leaders, including three leaders we interviewed: Randy Komisar,
Donna Dubinsky, and Bruce Chizen. His selfless spirit, cultivated on
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the football fields of his youth, has enabled him to develop a loyal
network of mentees, supporters, and friends. People are drawn to him
because he unleashes the leadership potential of those whom he
touches.
Campbell played offensive guard at Columbia University with an
intensity that still emanates from his eyes. On first impression, his
broad shoulders, tight jaw, and tough talk make it seem like he is
going to tackle you. Despite all the muscle, he genuinely cares about
people. “When you’re with Bill,” said Komisar, “you never have the
sense he’s worrying about himself.”
While an Apple executive, Campbell led the 1987 spin-off of
Claris and recruited a talented team to join him, including Komisar,
Dubinsky, and Chizen, all of whom eventually became CEOs. Each
of them speaks with great nostalgia about the Claris years and their
strong affection for Campbell. They still call him regularly for
wisdom, advice on difficult decisions, friendship, and laughter.
They are like a tight-knit family.
Relationships between Campbell and his mentees have been
highly interdependent. Dubinsky, Komisar, and Chizen recognized
Campbell could help them enhance their skills while they helped
him build Claris. Dubinsky said, “Bill taught us how to build a team,
operate the company, and communicate with employees.”
Campbell helped them discover authentic leadership by
modeling it for them. Dubinsky recalled the respect he showed
for others. “Bill would walk in and spend a few minutes every day
talking to the receptionist. He knew her problems in life and could
relate to what her kids were doing.” Campbell also knew how to
give tough love. He challenged his team to think beyond their
own narrow interests to focus on the entire company. Dubinsky
noted, “He pushed me a lot. He saw me as a champion for my
people, but insisted that I look out for the company’s best interests
as well.”
Most important, Campbell empowered all three of these leaders
by regularly asking for advice and revealing his own vulnerabilities.
Komisar recalled, “Bill exposed himself to us as a human being.”
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He would give a speech to the whole company, imploring us, “We’re going to do
this!” Then we would go in his office, shut the door, and he would say, “I’m
worried. Do you think the team can do this?” I saw a vulnerable human being
and was able to support him when he was down.
By being vulnerable and making subordinates his advisers,
Campbell gave Komisar, Dubinsky, and Chizen the confidence
and license to be authentic. Komisar said he learned to be comfort-
able with himself from being mentored by Campbell:
Bill brings tremendous knowledge and experience to the table. He does not give
you a fish, but teaches you how to fish. You sense from Bill an overwhelming
belief in you and deep caring for what happens to you. That is the highest
expression of love.
The best mentors put the interests of their mentees first. As a
result, their relationships grow into personal friendships, as mine did
withWarren Bennis. The cycle continues when those who benefited
from strong mentoring offer to mentor others.
Building True Friendships
Close friendships are built over years of shared experiences, with
each person having a genuine appreciation for the other. Most peo-
ple have no more than a handful of close friends, but they stay in
regular contact with them. Close friends provide reinforcement
when leaders feel discouraged and need a boost. It is often by shar-
ing vulnerabilities that their friendships deepen, because openness is
the sine qua non for cultivating relationships. Like mentoring,
friendship is a two-way street where both parties benefit from the
relationship. If it devolves into a situation where one person is doing
all the giving and the other all the receiving, the friendship will not
last for long.
DaVita CEO Kent Thiry uses redwood trees as a metaphor for
the way to develop close relationships. “Redwood trees are the
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tallest, strongest, longest-living tree in the forest. How do you get a
tall, strong, long-lived redwood tree? It takes time.” After college,
Thiry worked hard to maintain close contact with a handful of
friends, traveling to see them and organizing reunions throughout
the year. He also let them know how much their friendship meant to
him. “You can start to grow another tree, but it’s going to take 10
years or more. Wouldn’t it be a crime to cut a tree down just because
you were tired of it?”
With friends of many years, you develop special bonds of shared
life histories. However, relationships need to be nurtured and cannot
be taken for granted. Traditions help create lasting friendships. Chris
O’Connell, executive vice president of Medtronic, has a group of
seven classmates from business school who are among his closest
friends. “Once a year, we get together for a four-day retreat. In
12 years, not one person has missed a single year.”
When people grow together through the phases of life, they
develop a deeper understanding of each other. Having been
through it all together, close friends notice the little things,
such as when you need a kick, even when no one else can see
that. They can sense when you are getting off track and they aren’t
afraid to tell you.
True North Groups
One way of cultivating deep and authentic friendships is through
True North Groups, a term I coined with my friend Doug Baker Sr.
to label peer groups that meet regularly to talk about important issues
in their lives. True North Groups provide a safe environment in
which to open up, share your vulnerabilities and challenges, and
engage in intimate discussions. A carefully conceived structure
causes members of the group to probe their beliefs and relationships
and to describe the challenges they face. In 2011, Baker and I wrote
the book True North Groups as a guide for people who want to form
their own group.
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In preparing for the unexpected in life, Warren Bennis tells
leaders, “Have some group that will tell you the truth and to whom
you can tell the truth.”
If you have people like that around you, what else matters? You’re never going
to be prepared for 9/11, nor can you figure out what’s going to happen. All you
can do is make sure there’s some way of understanding reality beyond what you
know yourself.
In 1974, Baker and I formed a men’s group after a weekend
retreat; 40 years later, we’re still meeting weekly at a nearby
Minneapolis church. Having a group with whom you can share
your deepest feelings is a true blessing. We discuss our spiritual and
religious beliefs and doubts, career difficulties, marriage and family
problems, and the process of personal development.
Each week, one group member initiates discussion about an area
of faith or his developmental journey. Typically, discussions are
drawn from readings, poems, or editorials that challenge us to share
more deeply. In a recent meeting one group member asked to
suspend the program so that he could seek our advice about a
deeply personal challenge he was facing. The discussions are intense
but never judgmental. Our faith journeys have led members of the
group in different directions, but we come together with mutual
caring and respect.
Over the years we have developed a sense of shared history—
from having a member who died from Alzheimer’s disease to coping
with chemical dependency, divorce, challenging sons, death of a
child, loss of one’s job, and personal health issues. One issue we
never stop talking about is our relationship with our fathers, because
most of us had complex relationships that we are still trying to
understand. Being a part of this group has been a great boon to me
over the years, enabling me to share more of myself—my weaknesses
and my vulnerabilities—with my colleagues at work and to behave
more authentically.
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We all consider the group to have been one of the most
important aspects of our lives, enabling us to clarify our beliefs,
values, and understanding of vital issues, as well as providing a source
of honest feedback when we need it most. The key to its success is
what we call “honest conversations,” saying what you really believe
without fear of judgment, criticism, or reprisal.
There are multiple forms of support groups. For example, Penny
and I formed a couples group with three other pairs of friends 20 years
ago. We have rich discussions at our monthly meeting about our
faith, our lives, our families, and personal growth. We also travel
together regularly.
In my HBS course, Authentic Leadership Development (ALD),
we create six- to eight-person Leadership Development Groups as an
integral part of the classroom experience. Since its inauguration in
2005, ALD has become one of the most popular electives for both
MBA students and executive education participants. In the past
decade, 6,000 people have participated in these groups. Remarkable
conversations have emerged, and more important, strong bonds
have developed between group members, even in a one-week
executive program. At the end of each course, we ask participants
to evaluate what has been most meaningful to them in the course;
without exception, small groups sessions rank higher than any other
form of learning.
Your journey to leadership is likely to take many unexpected
turns. Life is full of challenging situations, including ethical dilem-
mas, midcourse career changes or burnout, seemingly intractable
interpersonal challenges, marriage and family issues, failures, and
loneliness. At times, you may feel you are losing your way or have
gotten off course from your True North.
Getting back on track alone is very difficult, perhaps even
impossible. During these moments, you need your support team.
It is important to build these relationships long before there is a crisis
in your life. In fact, developing these relationships now may be one
of the most important ways to prevent crises from occurring and help
you stay on the course of your True North.
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Exercise: Building Your Support Team
The following exercise will allow you to determine the kind of
support team you want to build.
1. Make a list of the most important relationships in your life, right
now and in the past.
a. What is your most important relationship?
b. Why is this person important to you?
c. In what ways do you look to this person for support?
2. What role has your family of origin played in your development
as a leader?
3. Who has mentored you as a leader? Have you had a particular
teacher, coach, or adviser who has been influential in your
interest in leadership and your development as a leader? How
have you helped your mentor and built a two-way relationship?
4. Which friends could you count on if things did not go well for
you? Do you have friends with whom you can share the challenges
you face openly? Can you give each other honest feedback?
5. Do you have a personal support group? If so, what is its value and
meaning to you and your leadership?
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8
INTEGRATED LIFE
The world will shape you if you let it. To live the life you
desire, you must make conscious choices.
—John Donahoe, CEO, eBay
Successful leaders live complex and demanding lives. As the fre-
quency of communication has intensified, the pace of business has
increased. Yet many of us have not learned how to deal with this new
reality. There is never enough time to do everything you want to do,
because the world around you makes ever greater demands on your
time. Nor will you be able to achieve a perfect balance between all
aspects of your life—your career, family, friends and community, and
personal life. Inevitably, you will have to make trade-offs. How you
do so will determine how fulfilling your life will be.
Authentic leaders are constantly aware of the importance of
staying grounded. In doing so, they avoid getting too cocky during
high points and forgetting who they are during low points. Spending
time with their families and close friends, getting physical exercise,
having spiritual practices, doing community service, and returning
to places where they grew up are all ways they stay grounded. This
grounding is essential to their effectiveness as leaders because it
enables them to preserve their authenticity.
Toavoid letting endless professional commitmentsdominate their
time, authentic leaders must give priority to their families and take
care of themselves personally, in terms of their health, recreation,
spirituality, and introspection.There is no silver-bullet solution to this
issue, but neglecting to integrate the facets of life can derail you.
To lead an integrated life, you need to bring together the major
elements of your personal life and professional life, including work,
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family, community, and friends, so that you can be the same person
in each environment. For authentic leaders, being true to themselves
by being the same person at work that they are at home is a constant
test, yet personal fulfillment is their ultimate reward. Doing so will
make you a more effective leader in all aspects of your life.
John Donahoe: Choosing to Live Fully
On a tranquil Boston evening in the fall of 1983, eBay’s John
Donahoe, then an energetic 23-year-old, enjoyed a relaxing dinner
with his fiancée, Eileen. Just a year out of college, Donahoe had
already earned an excellent reputation as a consultant at Bain &
Company. His eyes lit up as he talked about his career prospects.
As dinner continued, Eileen voiced concern about the toll John’s
career could take on his life. She worried that the long hours, constant
travel, and stress might limit his ability to have close relationships.
Then she asked him pointedly, “Is that really what you want in life?”
John answered adamantly, “No!”He reached into his wallet to find a
piece of paper and wrote on the back of a Shawmut Bank receipt,
“I will not live the life of a management consultant,” and signed his
name. John recalled, “Her challenge to me was, ‘Be who you are.’”
As Donahoe rose through the ranks to become Bain’s worldwide
managing director, he worked hard at leading an authentic life. “My
ultimate goal is to have an impact and be an authentic businessperson,
as well as the kind of father, husband, friend, and human being I want
to be. The human side is the highest goal and the ultimate challenge.”
According to Donahoe, “Leading a satisfying life is a quest worth
taking.”He believes integrating his life has enabled him to become a
more effective leader. “There is no nirvana,” he said.
The struggle is constant, as the trade-offs and choices don’t get any easier as you
get older. My personal and professional lives are not a zero-sum trade-off. I
have no doubt today that my children have made me a far more effective leader
in the workplace. Having a strong personal life has made the difference.
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Integrating their lives is one of the greatest challenges leaders
face. Donahoe stressed that being authentic takes continuous effort.
The challenges of maintaining authenticity, sense of self, learning, and growing
are the same no matter where you are. The world can shape you if you let it. To
have a sense of yourself as you live, you must make conscious choices.
Sometimes the choices are really hard, and you make a lot of mistakes.
One of his first big decisions came during his first year at business
school. The final term was the most intense academic experience of
his life. On the eve of finals, Eileen went into labor with their first
child. When Donahoe asked himself what was more important, the
birth of his child or his grades, the answer became obvious. Having
achieved in every academic environment, he had to let go of his
desire to get top grades. “In a strange way, I had an excuse for not
doing well. I had to accept the fact that I was not going to get straight
As.” As finals approached, Donahoe spent more time with Eileen.
As his colleagues became increasingly stressed, he felt oddly relaxed.
Much to his surprise, Donahoe earned the highest grades possible
that quarter. “It was only because I had a bit of perspective.
I certainly was not the smartest person in the room,” he said.
“I remember watching the inefficiency that kicked in when people
stressed out.” That experience showed him a strong personal life
could be an ally in achieving professional success.
A few years later, Donahoe faced another choice that confirmed
his belief that he could integrate his life in an authentic way. After
graduating from law school, Eileen received an offer to clerk for a
federal judge, but the job required her to be at work by 7:30 AM.
Donahoe had no alternative but to take their two kids to school
every day. Because his job required him to travel extensively, he
went to Tom Tierney, then managing director of Bain’s San
Francisco office, and told him that he had no choice except to
quit. Tierney just laughed and said, “John, we can find a way to work
around this.” He reassigned Donahoe to a local client, enabling him
to take his kids to school before heading to the client site.
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Donahoe was amazed that his clients appreciated the choices he
was making. He honestly shared his situation with the client: “It is
important to me to be doing this. I’m committed to working hard,
but I can’t be there before 10 AM.”
The client responded positively as he appreciated my commitment and
contributions even more. I didn’t have the courage to think about it that
way before. There’s an inclination in business to put on a tough exterior to give
the impression that you have everything under control.
Donahoe learned that themorehe integratedhis life andembraced
his humanity, the more effective he became as a leader. “That was my
best year of client work. Our client understood, and I became more
relaxed,” he recalled. By showing his team and clients his vulner-
abilities, he discovered his teams performed better and his client
relationships strengthened.
The following year, Donahoe was named head of Bain’s San
Francisco office. After six years in that role, he felt burned out by the
fast-paced life and wanted to spend more time with his two oldest
sons before they became teenagers. So he handed off his work to his
colleagues and took a three-month sabbatical. “It was an opportunity
to bring our family closer together,” he explained.
First the family went to Europe, and then Donahoe took separate
weeklong trips with his wife and each of his four children. He
returned to Bain reenergized. A year later, he was named worldwide
managing director, succeeding Tierney. The announcement came
just as the economy was plummeting in the first decade of the 2000s
and the health of one of his children tested him as never before.
“The health issue emerged soon after I became managing director,
just as the consulting industry faced its biggest downturn in 30 years.”
This was the hardest thing I’ve ever had to work through in my life. My family,
friends, coaches, and colleagues were unbelievably helpful. Real life forced me
to bring a sense of authenticity and vulnerability to the workplace, because life
humbles you.
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Sharing his personal situation helped him connect with his
partners, so they could rally during the downturn. By accepting
his vulnerabilities, Donahoe was able to maintain an even keel. “I
had faith in our people. We could talk about where we were going
and how we were going to make it happen,” he said. He believes he
was effective precisely because he was able to integrate his personal
and professional lives during stressful circumstances.
Because so much emotional energy was going to my family, I didn’t take the
downturn personally. As a result, I was more effective as a leader. My legacy to
my Bain partners will be the way I led us through the downturn.
After concluding his leadership of Bain, Donahoe became CEO
of eBay, succeeding Meg Whitman and transforming the company
into a vibrant competitor in the high-tech world of Silicon Valley.
Donahoe retired from eBay in 2015 after completing the spin-off of
highly successful PayPal.
Although 30 years have passed since their conversation that
night in Boston, Eileen Donahoe has not forgotten the signed
Shawmut Bank slip. “I still keep it inside my purse,” she said.
“I’ve brought it out many times over the years.” The Donahoes
have successfully weathered challenging stages of their lives and
continue to strive for an authentic life together. Their partnership
serves as an excellent example not only of how to be intentional in
building a meaningful life but also of how rewarding it can be.
Blending Careers with Family Life
These days, developing leaders wonder, “Can I have a great career
and a great family life?” This is the number one question I am asked
by my MBA students and those I mentor. Psychologist Ellen Langer
challenges the notion of work/life balance. “The idea I think to
replace work/life balance, which treats these categories as indepen-
dent, is work/life integration. You’re treating yourself whether you’re
at work or at play in basically the same way.”
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Increasing pressures and time demands on the job and the
complexities of two-career marriages have made this integration
more challenging than ever before. Younger leaders have seen many
in their parents’ generation sacrifice their families for their careers
and have lived through the pain of broken marriages and estranged
relationships. They are committed to doing it differently, but often
they don’t know how.
Integrating your work and home life is one of the most difficult
issues leaders face. There are no clear answers, and you must make
continual trade-offs. Most of us want to have a successful career and a
rewarding marriage and family life. That is certainly admirable. The
problem comes when you get into the habit of sacrificing yourself and
your family for the company. Years later, you may find yourself in a
career trap that you can’t withdraw from because your living expenses
are so high that you can’t afford to quit. Yet you may not realize the
trap in the early stages of your career. My advice is to establish clear
ground rules for your work/life integration and stick to them, rather
than getting into the habit of doing whatever it takes to get ahead.
When I was at Litton, my boss was one of the top five people in the
company. He owned an expensive home in Beverly Hills and belonged
to exclusive country clubs, yet he called regularly to tell me how much
he hated his job. One day I said to him, “If it’s that bad, why don’t you
quit?” Instantly he replied, “With all my expenses, I can’t afford to.”A
few years later, he died of lung cancer from smoking to relieve his stress.
To find that delicate balance, it is essential to set clear boundaries
betweenworkandhome life. If youdo so, youwill be pleasantly surprised
about where life will lead you. After all, the alternative is to earn a lot of
money and not have the time to share it with your family or to become
estranged from your spouse and children because you neglected them.
Managing Dual Careers
From the time I was a teenager, I was committed to leading a great
organization and having a great family life. I had friends whose
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fathers sacrificed their families to excel in their careers, and I worried
about this happening in my life. When Penny and I were dating, we
talked about how we could support both our careers and still have
plenty of time for our family. Before our children were born, finding a
balance was pretty easy. With both of us working, we were able to
adapt our schedules and spend our nonworking hours together.
When our sons, Jeff and Jon, were born, everything changed.
Penny was working as a consulting psychologist after obtaining her
master’s degree in psychology. She took time off from her job after
each boy was born and then went back to work part-time. Mean-
while, the intensity of my work was heating up. I traveled regularly to
Japan and Europe, sometimes on trips spanning 10 days. My absences
put a lot of pressure on Penny to raise the boys and get her work done.
I tried to do my full share of the child rearing, the chores, and the
boys’ transportation to day care or to sports, as well as carry my share
of the emotional load. I cannot say I succeeded. As hard as I tried,
Penny wound up with a much greater share of the burden, especially
when I was traveling. These days, I am a lot more realistic about the
challenges involved for our sons and their families.
Hitting the Wall at Home
Marriage is not a static state. To have a successful long-termmarriage,
you and your spouse have to work at it continuously, talking openly
about your differences, your fears, and your vulnerabilities. Penny
has been the barometer in our relationship, forcing us to talk through
the issues when we seem to be drifting apart or too caught up in
our own worlds. This has been an enormous help to me in opening
up more.
Not surprisingly, the high level of stress at Honeywell I experi-
enced in the late 1980s also carried over into my home life. During
those years, I was traveling almost constantly, which was hard on both
Penny and me. I found myself less happy with my work and began
turning to activities outside the company for a sense of fulfillment.
Meanwhile, I was in denial about how the stress was affecting my
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family and me. It was a good thing Penny confronted me about my
behavior and the toll it was taking on her and the boys. Our marriage
survived that period, but it wasn’t easy.Moving toMedtronic not only
wasmore satisfying tome personally, but it alsomade life better for our
family.
When you feel a great deal of pressure, it is hard to recognize
its impact on those closest to you. In retrospect, it took pain at
work and at home for me to face up to the reality that I needed to
change directions in my career and focus on what is truly impor-
tant in life.
An Integrated Life Makes You a Better Leader
Let’s confront directly the notion of who are the better leaders: the
80-hours-per-week executives who live for work and subordinate
everything to the company’s perceived needs or the leaders who
work equally hard during 50 to 60 hours but balance their work with
the needs of their families? Integrated leaders develop healthier
organizations. By appropriately delegating their work, they make
more thoughtful decisions and lead more effectively. Their employ-
ees make higher levels of commitment to the organization. In the
end, they achieve better results on the bottom line.
My leadership flourished when I found congruence among my
work, my personal life, and the company’s mission. Today’s
emerging leaders know from experiences in their families that
integration is imperative for leading a fulfilling life. They are
committed to excelling in their work but know that there is much
more to life. They certainly do not lack the passion to lead. Quite
the contrary: They will be better leaders because they are living
integrated lives.
If we sell our souls to the company, at the end of the day, we may
find we have little to show for our efforts. If we seek organizations
that nourish our souls, permit us to grow into fully functioning
human beings, and enable us to integrate our lives, we can find
fulfillment.
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Making Choices and Trade-Offs
Ellen Langer wasn’t alone; Warren Bennis also never liked the word
balance.
Balance is an engineering term that means you put the little weights on each
side, and if you’re really a good person, you’ll come out equal. We have to be
aware that we swing back and forth. It is choices all the time, not balance.
Wemake dozens of choices every day, many of them subconscious or
intuitive, and try to learn from those that turn out to be mistakes.
Ultimately, our lives are an expression of the choices we make. When
leaders talked about their crucibles, they said those experiences
forced them to ask, “What is most important in my life?”Asking that
question allows leaders to make conscious choices.
Xerox’s Anne Mulcahy said:
I like to work hard and have a serious career, but the most important thing in my
life is my family. I love Xerox and I’d kill for it, but it is not even on the same
scale as my family.
She and her husband, a 36-year Xerox veteran who traveled a great
deal himself, decided that one of them would be at home with their
kids every night. They also decided they would not move. Instead,
they commuted, even when their jobs required them to travel great
distances. “To be CEO of Xerox never having moved is quite
extraordinary, but it’s doable. At Xerox, we expect people to put
their families first. Unacceptable trade-offs should not be part of the
work environment.”
Martha Goldberg Aronson: Taking on Added
Responsibility
Emerging leaders are often identified as having the talent to lead
across a much wider business spectrum, and their companies test
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them in more challenging settings. In her early years at Medtronic,
Martha Goldberg Aronson developed a reputation as a high-poten-
tial leader. She joined the company’s acquisitions group and was
selected two years later to attend business school as a Medtronic
Fellow. Rejoining Medtronic as product manager, she was soon
promoted to run a start-up venture and eventually became general
manager of the business. As her business grew, Aronson’s career
prospects brightened.
One day, she was home alone with her two children when the
phone rang. Medtronic’s head of human resources asked her, “What
would you think about an international assignment?” Aronson
recalled, “I hemmed and hawed and told her this wasn’t the best
day to talk about a move.” Aronson was skeptical about whether an
international move was right for her career or her personal life. Being
far from the support of her parents and siblings with a baby and a
toddler was not part of her game plan. She also balked at walking
away from her current job before it was done and worried about the
impact on her husband’s career.
When she discussed the European opportunity with her
husband, Dan, his immediate reaction was, “Let’s go,” although
it meant a break in his career. So she accepted the job, realizing it
was a unique opportunity to live and work overseas. Aronson
flourished in the European environment. She grew professionally
and personally from the daily exposure to the wide range of
cultures in her region as her multicountry team produced signifi-
cant results. She took the risk when an opportunity came, and was
willing to learn more about leading in a complex geographic
environment without knowing the next step in her career.
After three years in Europe, she was pregnant with her third child
and felt she needed to be closer to her family in Minnesota to
continue her career and support her family. Her husband was also
eager to resume his career. She called Medtronic CEO Art Collins
to explain her dilemma. Collins immediately offered her the position
as head of investor relations. Just a year later, she was promoted to
the company’s executive committee as head of human resources.
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Eager to return to line management, Aronson left Medtronic
three years later and became national sales manager for a Chicago-
based health care company. Recognizing that constant travel was
keeping her away from her family, Aronson reconsidered her latest
move, and accepted a position at Minnesota-based Ecolab to build
its fledgling medical business. At last report, she is thriving both at
work and at home.
Aronson’s story offers some important lessons. All leaders have
to face difficult questions about work/life integration. Aronson’s
European role proved to be a formative experience for her career and
her family. However, too many sacrifices for your career may be a
signal that you’re out of balance. Although there is no perfect
balance between career and family, you have to put boundaries
around your work decisions, or you may find that work takes over
your life—and then you will not be effective in either domain.
The Buckets of Your Life
Many leaders think about integration in terms of bringing the
major parts of their lives together: family, work, friends and com-
munity, and personal time. Philip McCrea, CEO of ClearPoint, said,
“I have four buckets representing the important areas of my life.”
(See Figure 8.1.)
One is my career. The second is my family. The third is my community and
personal friendships, and fourth is the personal activities I enjoy. The third and
the fourth are very removed for me right now. This is not frustrating because
I’m tremendously fulfilled by the first two today. By age 40, I’d like to be in a
position where I have a better ability to fill buckets three and four—community,
friendships, and personal activities. Long term, I will not continue the career
I’m in if it leaves a void.
McCrea and his Swedish-born wife, Annika, who has a promis-
ing career herself as a consultant, made the difficult decision to
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plunge in and start a company just as they were starting their family.
Living in San Francisco, McCrea found he was traveling coast-to-
coast virtually every week because his customers—primarily large
pharmaceutical companies—were on the East Coast.
Eventually, he was faced with a stark choice: Give up his family
life or move his family to New Jersey to be close to his customers. He
and Annika chose the latter route, as she was able to convince her
company to transfer her to its U.S. headquarters in Connecticut.
Recently, McCrea and his family moved to Stockholm for three
years so that his teenage children could learn about their Swedish
culture and language and Annika could work at the headquarters of
her Swedish company.
Figure 8.1 Integrating Your Life
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Leadership can require significant sacrifices, especially during
intense periods of work, when certain buckets get less time. Gail
McGovern, CEO of the American Red Cross, framed it concisely:
A lot of people ask if it is possible to have a rich personal life and a great work
life. I say unequivocally, it is entirely possible. You just have to recognize you
can’t give 110 percent to everything. There are many mundane things in your
life you have to let go of and not feel guilty about.
To ease the pressures, McGovern hires people to help with child
care and does not worry if her house isn’t perfectly clean. “If you
accept you can’t be super housewife, super career person, super mom,
and super wife, there is absolutely no reason why you cannot have it
all,” she concluded. Now that her children are grown, McGovern is
at the peak of her career as CEO of the American Red Cross, where
she is transforming one of America’s greatest treasures into a well-
governed, vibrant organization.
Staying Grounded by Integrating Your Life
To integrate your life, you must remain grounded in your authentic
self, especially when the outside world is chaotic. Well-grounded
leaders have a steady and confident presence. They do not show up
as one person one day and another person the next. Integration takes
discipline, particularly during stressful times, when it is easy to
become reactive and slip into bad habits.
Leading is high-stress work. There is no way to avoid stress when
you are responsible for people, organizations, outcomes, and the
constant uncertainties of the environment. For global leaders, long
overseas trips intensify the stress. The higher you go, the greater your
freedom to control your destiny but also the higher the level of stress.
The question is not whether you can avoid stress but how you can
manage and relieve it to maintain your own sense of equilibrium.
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When Medtronic’s Chris O’Connell gets stressed, he said:
I feel myself slipping into a negative frame of mind. When I’m at my best, I’m
very positive and feel I can accomplish anything, both at work and home.When
I become negative, I lose effectiveness as a leader and become even less effective
at home. Both positive and negative emotions carry over between work and
home.
Prioritizing Your Family
Facebook COO Sheryl Sandberg integrates the buckets of her life
through a fundamental belief that success lies in the identification of
real priorities at work and at home and an acceptance that no one
can possibly do it all. In her book, Lean In, Sandberg defines success
as “making the best choices we can and accepting them.” She
encourages leaders, particularly women trying to integrate work
and family, to “learn from Icarus to aim for the sky, but keep in
mind we all have real limits.”
Each week, Sandberg and her husband, David Goldberg, CEO of
SurveyMonkey, sit down to plan who will take their two children to
school and discuss upcoming travel commitments to ensure at least
one parent can be at home. Sandberg and Goldberg both put high
priority on leaving the office in time for dinner. They dedicate their
weekends to spending time with their children, although Sandberg
admits to sneaking in e-mails from the local soccer field while
watching their kids’ games. Even with careful planning, Sandberg
acknowledges her family life and professional life are not perfectly in
sync. “I still struggle each day with trade-offs between work and
home,” she said. “Every woman I know does.”
Focusing on What Matters
When Sandberg worked as a McKinsey management consultant,
her manager implored her to take more control over her career,
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telling her, “McKinsey will never stop making demands on our
time, so it is our responsibility to draw the line . . . We need to
determine how many hours we are willing to work and how many
nights we travel.” After the birth of her son, Sandberg adjusted her
in-office hours at Google to 9 AM to 5:30 PM, enabling her to nurse
her son. To compensate, Sandberg got up in the early morning
hours to check e-mails and worked at home after her son went to
bed. She learned that by focusing her time, she did not need to
spend 12 hours a day in the office.
I focused on what really mattered and became more efficient, only attending
meetings that were truly necessary. I was determined to maximize my output
while away from home. I also paid more attention to the working hours of those
around me; cutting unnecessary meetings saved time for them as well.
Sandberg also lets family life and professional life blend together.
In Facebook’s early days, CEO Mark Zuckerberg hosted strategy
sessions at his home on Monday evenings. Instead of missing dinner
with her family, Sandberg brought her children into the office
instead, fondly recalling her time with them. She observed:
Facebook is incredibly family friendly, so my children were in heaven,
entranced by pizza, endless candy, and the huge pile of LEGOs the engineers
share with young visitors. It made me happy my kids got to know my colleagues
and vice versa.
Many leaders are reluctant to combine their work and family lives,
but bringing the two together can lead to more productive and
fulfilling lives, both personally and professionally.
Staying True to Your Roots
Returning to where you came from is another important way to stay
grounded. Just as Howard Schultz goes back to Brooklyn from time to
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time, Bill Campbell stays in regular contact with his old friends in
Homestead, Pennsylvania, which helps him keep perspective on life
in Silicon Valley. Akshata Murthy, who grew up in Bangalore as the
daughter of Infosys founder Narayana Murthy, returns to India
regularly to see her old friends and extended family. She is commit-
ted to making an impact there someday.
To restore themselves and keep their sense of perspective, leaders
may have a special place they can go with their families on weekends
and vacations. Many renowned leaders found they can think more
clearly away when they escape: Thomas Jefferson had Poplar Forest
andWinston Churchill had Chartwell. For decades, former secretary
of state George Shultz and his wife went to an old family farm they
own in Massachusetts. “I once told the president, ‘This is my Camp
David.’When I go there, I put on an old pair of pants and old shoes. I
am so relaxed, I don’t worry about anything.”
I experience that same sense of relaxation when Penny and I
retreat to our second home in Colorado. I have written most of my
books there, inspired by the beauty of the mountains. Although
owning a second home may be out of reach financially, you can
always escape to a nearby park or a local Starbucks where you can
read and think uninterrupted, like my son Jon does.
Finding Time for Yourself
To manage the stress of our leadership roles, we need personal
time to reflect. As Chapter 4 described, some people practice
meditation or yoga to center themselves and relieve anxiety.
Others find solace in prayer. Some people find they can release
tension by jogging at the end of a long workday. Still others find
relief through laughing with friends, listening to music, reading,
or going to movies.
It’s not important what you do, as long as you establish routines
to relieve your stress and think clearly about life, work, and personal
issues. It is critical not to abandon these routines when you’re facing
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an especially busy period, because that is when you need your stress
reduction techniques most of all.
Spiritual and Religious Practices
Understanding our role in the world by asking questions, such as
“What is the meaning and purpose of my life?” or “Why am I here?”
is the most personal and profound area of our leadership develop-
ment. Many leaders have an active religious or spiritual practice to
engage these issues, either privately or with like-minded people.
Some seek the answers through a process of introspection. Others
explore them through discussions with people closest to them.
Authentic leaders who are religious talked in our interviews about
thepower of prayer, being a part of church groups, andfinding solace at
church. Venture capitalist Denise O’Leary, who sits on several
prestigious corporate boards, listens to Gregorian chants at a local
church, while her husband, DaVita CEO Kent Thiry, reads Buddhist
texts to center himself. She explained, “Church is the place where I
find real solace. I remember loving this style ofmusic as a child. It ismy
meditation as it allows me to be introspective.”
Community
Being in direct contact with those who are less fortunate also
provides leaders invaluable perspectives about what is happening
in the world around them. Lisa Dawe, regional operations director
with DaVita, emphasized that human interactions in an AIDS
hospice helped her stay in touch with reality. “It is crucial to
connect with people one-on-one, not just to create a fundraising
plan for a nonprofit board.”
Being in touch with AIDS victims enabled me to feel human. I sat by the
bedsides and watched, one by one, as people died. That helped me understand
what I’m going to do when I get to that point and provided perspective on how
fortunate I am. It helped me get to the core of what it means to be human.
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Measuring Your Success
Have you clearly defined how you measure your success in life? If not,
you are at risk of defaulting to metrics such as money, fame, and
power, or letting other people measure success for you. Clay Chris-
tensen’s book How Will You Measure Your Life? acknowledges an
uncomfortable truth: It is significantly easier to measure the return
on investment of an incremental hour at work than of spending that
same hour with your young children. As a result, we unintentionally
sacrifice investments in our families—not because we don’t care
about our families, but because the benefit is harder to see. Once the
cost of these decisions becomes apparent, it’s too late to recapture
that precious time. Christensen challenges his students to set goals
for their whole lives and then define priorities to achieve them. Only
when you define what is most important in your life can you set the
right priorities and become an integrated leader.
Integrating All Aspects of Your Life
Being authentic is not just something you are at work. It must be
reflected in all aspects of your life. Unfortunately, the pressures of
society and work often cause us to behave differently in the various
aspects of life—work, family, social, and spiritual. As a result, we
wind up compartmentalizing our lives.
Can you imagine yourself trying to be a strong, mature leader at
work, impervious to all the pressures? A rising leader in your
community? A laid-back person at home? And practicing a private
spiritual life? That’s what I was doing in my early thirties. To cope
with all these different roles, I created internal compartments for
each of them and behaved according to the expectations I encoun-
tered in each environment. Anyone who knew me well saw I was
anything but authentic in all these roles.
In 1974, Penny and I went on a spiritual retreat weekend that
was a life-changing experience for us. Throughout the weekend, the
sharing of love we experienced deeply moved us, but I also saw
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clearly for the first time how I was compartmentalizing my life. I did
not have the courage to share all of myself and who I really was with
people in these different environments, especially my superiors at
work. I was so afraid to tell my boss at Litton where I was going that I
set up a special arrangement with my secretary to contact me if he
called during the retreat. I was more focused on managing my boss’s
image of me than on being myself. I perceived it was acceptable to
tell him I was golfing but not to tell him I was growing spiritually.
Emerging from the weekend, I decided to knock down these
artificial walls and decompartmentalize my life. I committed to be
the same person at home, at work, in the community, and in church.
During this time, Penny was a great reality check, challenging me
when she observed me behaving differently in social settings. This
wasn’t easy, and it took many years before I felt fully comfortable
letting people in each aspect of my life see who I really was.
What does it mean to live your life with integrity? Real integrity
results from merging all aspects of your life so that you are true to
yourself in all settings. Think of your life like a house, with a
bedroom for your personal life, a study for your professional life, a
family room for your family, and a living room to share with your
friends. Can you knock down the walls between these rooms and be
the same person in each of them?When you can act the same in each
setting, you are well on your way to living your life with genuine
integrity. Living that way, you can be an authentic leader leading a
fulfilling life.
Leading an authentic life requires openness to all that life has to
offer and a willingness to go with the flow of life. It is important to
seek this richness early in life, when you are still in a formative stage
and open to the breadth of your experiences. You will be surprised at
the way early experiences open up new avenues of exploration, lead
you to interesting people, and shape your thinking about your
professional life as well as your personal life. At the end of the
day, you will be able to tell your grandchildren that you had the
courage to dive into life, experience its joys and sorrows, and leave
the world a better place.
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Exercise: The Integrated Leader
1. What is most important to you in your personal life? In what ways
do you nurture your inner life?
2. What do you do to ensure that you stay grounded professionally?
In what ways do your family life, personal life, friendships, and
community life add to or detract from your professional life?
3. How do you cope with the seductions and pressures of profes-
sional life and still stay focused on your True North?
4. What is the most difficult choice or trade-off between various
aspects of your life that you have made in the past? What would
you do differently in the future? What is the most difficult trade-
off or choice that you are facing right now?
5. How do you measure success in your life? What is your personal
scorecard? What long-term achievements would you like to
realize? What will bring you the greatest amount of happiness?
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Part Three
Your True North
Meets the World
Parts I and II were inward-looking as you explored your leadership
journey and your development as an authentic leader. In Part III, the
focus shifts to the world around you. Having discovered your True
North, you can now learn how to be more effective as a leader within
your organization.
Leaders don’t operate in a vacuum: You have to apply your
leadership in real-world settings with significant challenges. The real
measure of your effectiveness as a leader is your ability to use your
True North to lead and empower people to have sustainable impact
in solving challenging problems. This is where you realize your full
potential as a leader.
By shifting your focus from yourself to serving others, you make
the transformation from I to We. Then you will be prepared to
discern your purpose in leading others and how it aligns with your
organization’s purpose. Having this clarity enables you to empower
your teammates to lead around a common purpose and shared values.
Finally, we examine the additional qualities you need to be an
authentic global leader in today’s global world.

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9
I TOWE
In the middle of the road of my life, I awoke in a dark
wood, where the true way was wholly lost.
—Dante Alighieri, The Divine Comedy
Having focused on essential areas of your development as a leader,
we are ready to tackle the greatest challenge of your journey: the
transformation from I to We. In your early years, you are measured
primarily for your individual contributions. Thus, it is difficult for
emerging leaders to recognize that leadership is not about them and
their ability to attract followers but is about serving others to bring
out the best in them. We leaders are servant leaders.
I first encountered the notion of servant leadership in 1965,
when I invited Robert Greenleaf to present his emergent ideas on
this subject to the Musser Seminar on Business and Christian Ethics.
Greenleaf described his views on the leader in his 1970 essay, “The
Servant as Leader”:
The servant-leader is servant first. One wants to serve first; then one aspires to
lead. This is sharply different from one who is leader first, perhaps because of
the need to assuage an unusual power drive or to acquire material possessions.
A servant-leader focuses primarily on the growth and well-being of people and
the communities to which they belong. The servant-leader shares power, puts
the needs of others first, and helps people develop and perform as highly
as possible.
Jaime Irick, a rising star at General Electric and West Point
graduate, explained this transformation in practical terms. “You
have to realize that it’s not about you,” he explained.
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To get into West Point or General Electric, you have to be the best. That is
defined by what you can do on your own—your ability to do well on a
standardized test or be a phenomenal analyst or consultant. When you become
a leader, your challenge is to inspire others, develop them, and create change
through them. If you want to be a leader, you’ve got to flip that switch and
understand that it’s about serving the folks on your team. This is a very simple
concept, but one many people overlook. The sooner people realize it, the faster
they will become leaders.
Nelson Mandela: Seeking
Reconciliation, Not Retribution
Nelson Mandela’s transformation from I to We is one of the most
powerful ever experienced. He endured all forms of pain: hard labor,
racist taunts, extreme illness in minimal conditions, and 27 years in
prison for a political crime he didn’t commit. Because of his efforts,
he saved South Africa from civil war and became a role model for
leaders all over the world.
On February 11, 1990, Mandela walked out of his prison cell at
Robben Island, a free man for the first time since 1963. He described
the scene:
As I walked toward the prison gate and was among the crowd, I raised my right
fist and there was a roar. I had not been able to do that for 27 years. It gave me a
surge of strength and joy.
That evening, Mandela spoke to a large crowd at the Grand
Parade in Cape Town. His brief but carefully chosen remarks set
forth his plan for the future of South Africa:
I stand here before you not as a prophet but as a humble servant of you, the
people. Your tireless and heroic sacrifices have made it possible for me to be here
today. I therefore place the remaining years of my life in your hands.
In those few words, Mandela declared that his purpose was to be
a servant leader for all South Africans. Note that there is no
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bitterness in his words. Mandela wanted democracy for all, not just
black South Africans. In his book, Long Walk to Freedom, Mandela
elaborated, “I knew people expected me to harbor anger toward
whites. But I had none.”
I wanted South Africa to see that I loved even my enemies while I hated the
system that turned us against one another. We did not want to destroy
the country before we freed it, and to drive the whites away would devastate
the nation. Whites are fellow South Africans. We must do everything we can to
persuade our white compatriots that a new, nonracial South Africa will be a
better place for all.
Mandela Emerges as a Leader
When theAfrikaners took power in SouthAfrica in 1948 and created
apartheid, Mandela became a founding member of the Youth League
of the African National Congress (ANC), aligning with young
leaders that included Walter Sisulu, Oliver Tambo, and, years later,
Thabo Mbeki. Eventually, the Youth League took over the ANC.
In the 1950s, Mandela was an angry young man who was repeat-
edly arrested for sedition. Later, he joined the South African Com-
munist Party and founded amilitant group to sabotage theAfrikaners’
apartheid government. Mandela frequently organized boycotts and
demonstrations against apartheid that erupted in violence.
In 1956, the Afrikaner government arrested him for high treason
in causing violence. He endured the four-year Treason Trial and was
eventually declared not guilty. That didn’t satisfy the Afrikaner
government, which arrested Mandela for political crimes in 1962.
During the ensuing Rivonia Trial, Mandela gave his most important
speech, defending the ANC’s actions and laying the groundwork for
South African democracy three decades later. He concluded his
three-hour oration with these words:
I have dedicated my life to this struggle of the African people. I have fought
against white domination, and I have fought against black domination. I have
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cherished the ideal of a democratic and free society in which all persons will live
together in harmony and with equal opportunities. It is an ideal for which I hope
to live and to see realized, but it is an ideal for which I am prepared to die.
It was to no avail. On June 12, 1964, Nelson Mandela was
sentenced to life imprisonment.
During his long years in prison,Mandelawent frombeing an angry
man to a transformative leader who realized his greater purpose was to
serve his nation by saving it from civil war and reuniting all the people
of his country.He reframedhis leadership purpose from the I of leading
black South Africans to become servant leader of all South Africans,
someone who could reconcile blacks and whites to create the new
South Africa, centered on social justice and opportunity for all.
As a servant leader, Mandela rose above discrimination, injus-
tice, and hatred. If ever a person had a right to be bitter toward
his captors and the injustice done to him, it was Mandela. How then
could he honor the prison guards who looked after him and forgive
the judge who sentenced him? How was he able to negotiate with
the leader of a minority government that repeatedly ordered his
people beaten and killed to stay in power? When Mandela was
elected president, how was he able to cast aside calls for revenge and
offer reconciliation to his oppressors?
To know the answers to these questions, one would have to walk
in Mandela’s shoes or look into his soul.
When I met with him privately in 2004, he was passionate and
calm—no longer the angry activist of his thirties. He was focused on
his mission of reconciliation from racial injustice. His vision deeply
moved me. Mandela’s leadership transformation inspires us to serve
and lead others in greater callings.
From Hero’s Journey to Leader’s Journey
As we enter the world of work, most of us envision ourselves in the
image of a hero who can change the world for the better. This is a
perfectly natural embarkation point for leaders. After all, so much of
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our early success in life depends upon our individual efforts, from the
grades we earn in school to our performance in individual sports to
our initial work assignments. Admissions offices and employers
closely examine those achievements and use them to make
comparisons.
As we are promoted from individual roles to leadership, we
believe we are being recognized for our ability to get others to follow
us. If we think leadership is just about getting others to follow us and
do our bidding as we climb the organization ladder, we risk derail-
ment. You may reach the point in your journey when your way
forward is blocked or your worldview is turned upside down by
events. This may trigger a rethinking of the purpose of your life and
your leadership.
To become authentic leaders, we must discard the myth that
leadership means having legions of supporters following us as we
ascend to the pinnacles of power. Only then can we realize that
authentic leadership is serving people by aligning them around a
common mission and values and empowering them on their
leadership journeys. This transformation from I to We is the
most important process leaders go through in becoming authen-
tic. How else can they unleash the power of their organizations
unless they motivate people to reach their full potential? If
supporters merely follow the leader, they are limited by the
leader’s vision.
Only when leaders stop focusing on their personal needs and
see themselves as serving others are they able to develop other
leaders. They feel less competitive with talented peers and sub-
ordinates and are more open to other points of view, enabling them
to make better decisions. As they overcome their need to control
everything, they learn that people are more interested in working
with them. A light bulb turns on as they recognize the unlimited
potential of empowered leaders working together toward a shared
purpose.
Figure 9.1 captures some distinct differences between I leaders
and We leaders.
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Challenges in Making the Transformation
Making the transformation from I to We is not an easy task. It not
only requires a mental rethinking of your leadership, but it also
necessitates changes in behavior to focus on others rather than
yourself. Let’s look at several leaders who struggled with this
transition and emerged as exceptional leaders.
Gail McGovern: “It’s Not Fair”
As CEO of the American Red Cross, Gail McGovern has never
forgotten struggling with leadership upon her first promotion as a
telecommunications manager. “Within one month, I went from
being the best programmer to the worst supervisor in Pennsylvania
Bell,” she said.
It’s unbelievable how bad I was. I didn’t know how to delegate. When
somebody had a question about their work, I’d pick it up and do it. My group
was not accomplishing anything because I was on the critical path of everything.
My boss saw we were imploding, so he did an amazing thing: He gave me every
new project that came in. It was unreal. At 4:30 PM, my team would leave,
and I’d be working day and night trying to dig through this stuff.
Figure 9.1 I versus We Leaders
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Finally, I couldn’t take it any longer. I went to his office, stamped my foot
like a 5-year-old, and said, “It’s not fair. I have the work of 10 people.”He said
calmly, “Look out there. You have 10 people. Put them to work.” It was such a
startling revelation. I said sheepishly, “I get it.”
Doug Baker Jr.: A Call to the Heart
One of the hardest things for leaders is to see themselves as others see
them. When they receive critical feedback, their initial response is
often defensive, challenging the validity of the criticism or the critics
themselves. If leaders can process the criticism objectively, however,
constructive feedback can trigger a fundamental reappraisal of their
leadership and propel them on the journey from I to We.
That’swhatDougBaker Jr. learnedwhenhewas rising through the
ranks of Minnesota-based Ecolab. After working in marketing in
Germany for three years, Baker moved to North Carolina as deputy
headofanewlyacquiredcompany.To integratehis team,Bakerhireda
coach to conduct 360-degree assessments and facilitate group sessions.
“I elected tobefirst togothroughthehigh-impact leadershipprogram.”
At 34, Baker saw himself as a fast-rising star, moving rapidly from
one leadership role to the next. “I had become arrogant and was
pushing my own agenda,” he said. Then he got the results from the
assessment, in which his colleagues told him all this and more. “I got
a major dose of criticism I didn’t expect.”
As part of this process, I went away for five days with a dozen strangers from
different companies and shared my feedback with them. Since I had been so
understanding in this session, I expected people to say, “How could your team
possibly say you were ego-driven?” Instead, I got the same critical assessment
from this new group.
It was as if someone flashed a mirror in front of me at my absolute worst.
What I saw was horrifying, but also a great lesson. After that, I did a lot of soul-
searching about what kind of leader I was going to be. I talked to everyone on
my Ecolab team about what I had learned, telling them, “Let’s have a
conversation. I need your help.”
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Meanwhile, Baker’s division was challenged by a larger compet-
itor that threatened to take away its business with McDonald’s,
which accounted for the bulk of its revenues. When he forecast a
significant shortfall from his financial plan, the corporate CEO
traveled to North Carolina to find out what was going on. Asked
by the CEO to commit to saving theMcDonald’s business in the face
of intense new competition, Baker refused. This raised the CEO’s ire,
but Baker held his ground, unwilling to be pressured into commit-
ments he wasn’t sure he could fulfill. Reflecting on confronting his
powerful boss, Baker commented, “I’d rather have a bad meeting
than a bad life.”
If we had lost McDonald’s, it would have been embarrassing for me, but it was
all these folks in the plant who were really going to be hurt. There was
unemployment all over North Carolina as many factories were shutting down.
If they don’t have a job here, they don’t have a job, period. Suddenly, you find
the cause is a call to the heart. Saving the McDonald’s account created a lot of
energy. Fortunately, we retained the business. It was a traumatic time, but
ultimately a great learning experience for me.
Doug Baker Jr. received critical feedback about being an I leader
just in time. On the verge of becoming overly self-confident and
thinking leadership was about his success, the criticism brought him
back to earth. It enabled him to realize his role as a leader was to unite
the people in his organization around a common purpose. Saving the
McDonald’s account provided a rallying point for that unity.
Under pressure from the CEO to deliver short-term numbers,
Baker kept his organization focused on the long-term objective of
building the business. This experience paved the way for him to
become Ecolab’s next CEO. After 10 years at the helm, Baker has a
record that speaks to his leadership: Ecolab’s stock tripled as he made
timely acquisitions in the energy field. He has also assumed impor-
tant leadership roles in the business community as chair of the
Minnesota Business Partnership and Greater MSP.
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Zach Clayton: It’s Not about Your Resume
Like many achievement-oriented leaders, Zach Clayton grew up
defining his identity by his accomplishments. “At age 13, I visualized
creating the perfect college application,” he admitted, “and worked
painstakingly to build it.” In high school, he was elected class
president, was named valedictorian, wrote a book on post-9/11
youth politics, and was elected co-chairperson of the National
Association of Student Councils.
Clayton ultimately decided to attend the University of North
Carolina at Chapel Hill on the Morehead-Cain scholarship. There
he wrote another book on politics and started a software business. At
22, he became one of the youngest students admitted to his class at
Harvard Business School and graduated as a Baker Scholar, at the
top of his class.
When I graduated, I ended up declining an offer from McKinsey in order to
launch Three Ships, a digital marketing company. It was the height of the 2009
recession and I was nervous about giving up a prestigious position. I remember
thinking, “One day we will build the company to 20 employees and several
million in revenue. Then it will be worth it.”
When that day came, I was ready to raise the goal to $20 million, and
then it hit me. My God, I am on a treadmill promising myself I will be satisfied
when my next big accomplishment comes. This is the fifth time I’ve gone
through this cycle, and I’m about to do it again.
During this period, I talked frequently with Clayton as he came
to the realization he would be unfulfilled if he measured his life by his
resume.
I hit a wall in 2013 that made me realize I had to claim my identity apart from
Three Ships in order to be happy. If I am only aiming for accomplishments,
I can never get enough. I was neglecting the idealistic thread in my life that has
always been drawn to service.
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Following these realizations, Clayton resolved to connect his
idealism with his business aspirations. He involved his entire team
at Three Ships in creating a written purpose and set of values for the
business. One of the aims is to empower people to fulfill their full
potential. In 2015, his team launched Three Ships University,
providing professional and personal development training for employ-
ees and clients.
“Every day I am trying to make the transition to a We leader,”
Clayton said, “but getting past my personal desire for outward success
hasn’t happened overnight—as my 360 feedback showed.”
Looking back at the transition of the past year, I feel more energized, motivated,
and happier. My team is more engaged and feels trusted. As I’ve shifted my
focus to developing others, we have strengthened our value proposition for
customers and employees—and the business is more successful.
Have you ever become so caught up in success that you think it’s
all about your leadership? Did you have truth tellers around you?
Hard as it is to take in, feedback provides the opportunity to make
the transformation from focusing on yourself to understanding how
you can be an effective leader of other people, just as McGovern,
Baker, and Clayton did. This requires letting go and trusting others.
Crucibles Help Make the Transformation
Often, having a crucible can force you to reflect on your life and
propel your transformation from I toWe. That’s what Steve Jobs and
John Mackey learned through their painful experiences.
Steve Jobs: Learning in the Wilderness
Steve Jobs once asked plaintively, “How can you get fired from the
company you started?” That’s precisely what happened when Jobs
lost a power struggle with Apple CEO John Scully. The Apple board
concluded he was so disruptive in pursuing his own projects that he
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intentionally undermined everyone else. Decades later, Jobs
reflected on the experience in his 2005 Stanford University com-
mencement address:
Getting fired from Apple was the best thing that could have ever happened to
me. The heaviness of being successful was replaced by the lightness of being a
beginner again, less sure about everything. It freed me to enter one of the most
creative periods of my life.
During the next five years, I started a company named NeXT, another
company named Pixar, and fell in love with an amazing woman who would
become my wife. Pixar created the world’s first computer animated feature
film, Toy Story, and is now the most successful animation studio in the world.
When Apple bought NeXT, Jobs returned to Apple. During his
wilderness experience, Jobs realized he didn’t have to do every-
thing himself and that his greatest gift was inspiring innovative
people to create great products. At Pixar, he worked with two of
the world’s most creative leaders, Ed Catmull and John Lasseter,
and recognized the benefits of nurturing great teams. Watching
them, Jobs learned to moderate his competitiveness. As Jobs said,
“None of this would have happened if I hadn’t been fired fromApple.
It was awful tasting medicine, but I guess the patient needed it.”
Jobs was a wiser, more mature leader when he returned to Apple
in 1996 after an 11-year absence. He had learned how to nurture
great teams and recognize their contributions. As one of his direct
reports told me, “Steve still acted like a jerk on many occasions, but
when he returned, he surrounded himself with high EQ (emotional
intelligence) leaders like Tim Cook, Jonny Ive, and Ron Johnson,
who moderated his impact on others.”
Jobs had a practice of looking in the mirror each morning and
asking himself, “If today were the last day of my life, would I want to
do what I am about to do today?”Whenever the answer was no for too
many days in a row, he knew he needed to change. He said, “Your
time is limited, so don’t waste it living someone else’s life. . . . Have
the courage to follow your heart and intuition.”
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Steve Jobs wisely followed his own advice, living every day to the
fullest before cancer cut his life short. He left Apple in the strongest
position of any company in the world and passed the baton to his
successor, Tim Cook. Cook has the self-esteem not to emulate Jobs
but to march to the beat of his own drummer.
John Mackey: Learning to Share Power
Whole Foods Market cofounder JohnMackey dropped out of college
in 1978 and borrowed $45,000 from family and friends to found his
first health food store, SaferWay. He lived above the store as he got
the business going.When he acquired another natural foods store, he
renamed the business Whole Foods Market. Through a series of
acquisitions, Whole Foods morphed from a health food store into a
supermarket selling healthy foods. Although he has created
$17 billion in value for his shareholders, Mackey takes no salary
or bonus and owns only 0.2 percent of the company’s stock.
When you meet John Mackey, you know you’re talking to an
authentic leader: a committed capitalist who is exceptionally pas-
sionate about healthy foods and transforming unhealthy eating
patterns. He is devoted to his customers and his employees and
outspoken in his views. He asked, “If Whole Foods doesn’t take a
leadership role in educating people about healthy diets, who the
heck is going to do it?”
I first encountered Mackey’s philosophy through his remarkable
debate with Nobel Prize–winning economist Milton Friedman about
whether the purpose of the corporation was to serve its customers
and fulfill its mission or maximize returns to its shareholders. As he
said, “We don’t sell healthy foods to earn a profit. We earn a profit to
sell healthy foods.” I was pleased whenMackey asked me to write the
foreword to his signature book, Conscious Capitalism. In it, he wrote,
“We should commit ourselves to following our heart and doing what
we most love and what is most meaningful to us.”
Mackey had to overcome many obstacles to get on the path to
sustained success. In 2008–2009, he faced the greatest challenge of
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his career. It started with Michael Pollan’s criticisms of Whole Foods
in his popular book The Omnivore’s Dilemma. Then Whole Foods’
acquisition of Wild Oats was challenged by the Federal Trade
Commission (FTC) for monopolizing the natural foods market.
In the midst of the FTC investigation, the Securities and Exchange
Commission discovered that Mackey had been posting criticisms of
Wild Oats for eight years on Yahoo Finance’s message boards, using
the pseudonym Rahobed.
Meanwhile, Whole Foods’ spectacular same-store sales growth
began to slow. In the face of this pressure, its stock price collapsed,
declining 88 percent from $38.70 to $4.72 by December 2008. The
drop caused hedge fund raider Ron Burkle to buy 7 percent ofWhole
Foods and agitate for changes in its leadership. As a consequence,
theWhole Foods board stepped in to determine what was required to
preserve the company.
Mackey, who had a reputation for being a lone ranger and very
outspoken, realized he needed to change. He eventually welcomed
the board’s constructive inputs, recognizing that he had to transform
his leadership from operating so independently to become more of a
We leader. Ultimately, the board settled the FTC suit, agreeing to
sell 32 Wild Oats stores in overlapping markets. It stripped Mackey
of his chairman title, appointing longtime board member John
Elstrott in his place, and ordered Mackey not to make public
statements. The following year, Whole Foods veteran Walter
Robb became co-CEO alongside Mackey.
Since these changes, the business has done exceptionally well.
Whole Foods expanded from 284 stores to 400, revenues grew from
$8 billion to $15 billion by 2014, and the company’s stock soared 10
times from its 2008 low to $48. Whole Foods’ co-CEO leadership
structure has worked well, because Mackey and Robb created a
formidable partnership based on mutual respect. Although Mackey’s
outspokenness occasionally gets him in trouble, he has proved
himself to be much more than a passionate entrepreneur. Today,
he is a great We leader of the Whole Foods team, something I
witnessed in person when I spent two days at Whole Foods in 2012.
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My Defining Leadership Experience
In the middle of our careers, it is common to find ourselves
in situations from which we think we cannot escape. Often our
blind spots cause us to miss what is happening to us. As Dante wrote
in the beginning of The Divine Comedy, “In the middle of the road of
my life, I awoke in a dark wood, where the true way was wholly lost.”
Have you ever felt this way? I know I have. Like me, you may be in a
midcareer crucible and not even recognize you need to make the I to
We transition.
The most agonizing time in my career came when I least
expected it.
In the mid-1980s I was onmy way to the top of Honeywell.What
began as a huge promotion turned into a decision to reassess my
career and tomove in a new direction. By 1988, I had been promoted
several times, taking over more responsibility for Honeywell’s most
challenging businesses. At the time, I was responsible for three
groups, nine divisions, 18,000 employees—and a raft of problems.
I had developed a reputation as “Mr. Fixit,” the guy who could
turn around Honeywell’s troubled businesses. I knew how to turn
businesses around, but I never had time to reap the fruits of my labor
before moving on to the next set of troubled operations.
In my last assignment, I uncovered losses exceeding $500 million
that had not been recognized or accounted for properly. This caused
a great deal of consternation for the Honeywell board and its
shareholders. We could do nothing except get all the problems
on the table and correct them. As I was fond of saying, “I didn’t
create the problems. I’m just the guy who’s trying to fix them.”
During this period, I started questioning whether Honeywell was
really the place for me. I had always seen myself as a growth-oriented
leader, not a turnaround specialist. When presented with problems, I
was quite willing to get them resolved, but I yearned to build
sustainable-growth businesses.
On a beautiful fall afternoon while driving around the lake near
my home, I looked in the rearview mirror and saw a miserable
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person—me. On the surface, I appeared to be energized and confi-
dent, but inside I was deeply unhappy. I wasn’t passionate about
Honeywell’s businesses and realized I was out of sync with Honey-
well’s slow-moving, change-resistant culture. Worse yet, I was
becoming more concerned with appearances and attire than with
being the values-centered leader I had always tried to be. One visible
signal that I was playing someone else’s game was that I had started to
wear cuff links. Reluctantly, I faced up to the reality that Honeywell
was changing me more than I was changing it—and I didn’t like the
changes I saw in myself.
I drove home and told Penny just what I was feeling. She said
compassionately, “Bill, I’ve been trying to tell you this for a year but
you refused to listen.” That evening, we had a long talk about our
lives and our careers. We recognized my lack of job fulfillment was
having a negative impact on our marriage, our sons, and our
friendships.
Penny helped me realize that, like Dante, I was “in a dark wood.”
I was too fixated on being CEO of a very large corporation rather
than following my heart and working toward a worthwhile purpose.
Reluctantly, I acknowledged I was letting my ego get in the way of
my values. If indeed I was in a trap, it was a trap of my own making. I
was focusing too much on external measures of success and losing my
passion to help others let their light shine.
In this position it is difficult to see things clearly, and we may
miss the opportunity that is staring us in the face. Over the years, I
had three opportunities to join Medtronic, dating back to 1978. I
turned them all down, mostly because I didn’t feel Medtronic was a
large enough company for me; it was only one-third the size of my
Honeywell sector. Yet the opportunity kept nagging at me. Had I
done the right thing? It finally dawned on me that I was so caught up
in my drive to run a major corporation that I was in danger of losing
my soul. In the process, I realized I had sold Medtronic short and
maybe myself as well.
The next morning, I talked with my men’s group and asked them
for candid feedback. They had seen what was happening and were
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pleased I was recognizing I had lost sight of the purpose of my
leadership. I kept thinking about the vision I had in my teenage
years: leading a mission-driven, values-centered company where I
was passionate about the company’s products and the opportunity to
serve others.
At this point, I had not fully made the transition from I to We.
What better place to do that than Medtronic? I called Medtronic
CEOWinWallin and reopened the door. Several months later, after
conversations with Wallin, founder Earl Bakken, and several board
members, I became Medtronic’s president and COO.
I finally found the place—or it had found me—that offered
everything I wanted: values, passion, and the opportunity to help
people suffering from chronic disease. The Medtronic mission to
restore people to full health inspired me from the moment
Bakken described it. In midcareer, I had the good fortune to
find congruence between Medtronic’s needs and my personal
desires.
My 13 years there was the best professional experience of my life.
I fully embraced the Medtronic mission of restoring people to full
health and discovered the purpose of my leadership in serving
patients and empowering 26,000 employees. Had it not been for
my midcareer crucible, I might never have seen the light. Only in
going my own way did I become fully alive as I finally made the
transition from I to We.
Taking the I to We Journey
Making the transformation from I to We requires introspection and
cognitive reframing. To get started, ask yourself these basic
questions:
• Does my life matter? To whom?
• What’s the purpose of my life and my leadership?
• Will I leave a legacy behind?
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I suspect your introspection will not lead you to the conclusion
that your life’s purpose is to accumulate possessions, material wealth,
fame, or power over others. After all, at the end of the day, you
cannot take your possessions with you. Material wealth is a currency
with no intrinsic value, and it contains the extrinsic risk of pulling
you off the course of your True North. Fame is fleeting. Like mercury,
it can build up for many years and slip right through your fingers.
Seeking power over others is the ultimate corrupter of the human
character.
My friend Peb Jackson told me about a wealthy man in his late
forties who had accumulated more than $100 million in personal
wealth. The man told Jackson his life lacked fulfillment and
satisfaction, and he had a hollow feeling inside. Then the man
asked, “Is this all there is?” Jackson gave him a compassionate,
but honest, answer: “If all you’re chasing is money, then that’s all
there is.”
So what does that leave? Just this: Life is about serving something
or someone greater than ourselves—a worthy cause, an organization
important to you, your family, or a friend in need. In my experience,
that’s the best way to know that your life matters. Becoming a
servant leader propels you on the I to We journey.
Your True North shows the way to finding and fulfilling your
life purpose—the way in which you use the unique gifts you bring
to the world. Ask yourself, “How can I leave a lasting mark on
the world?” Your answer to that question will be a clear expres-
sion of your life’s purpose and the way you will use your leader-
ship gifts.
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Exercise: Your Transformation from I toWe
After reading Chapter 9, think back over your life, and recall the
experiences that enabled you to go from hero’s journey to leader’s
journey.
1. Do you ever see yourself as the hero of your own journey?
2. Have you made the transformation from I to We? If so, what
experience or experiences triggered this transformation for you?
3. If you have not yet made this transformation, what would have to
happen in your life and leadership for a transformation like this to
occur?
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10
PURPOSE
There is a thread that you follow. It goes among
things that change. But it doesn’t change . . .
While you hold it you can’t get lost . . .
You don’t ever let go of the thread.
—William Stafford, “The Way It Is”
Having focused on the transformation from I toWe, you are ready to
discern the purpose of your leadership. Understanding your life story,
your crucibles, and the transformation from I to We all help you
discover your purpose. As an authentic leader, you must choose your
purpose carefully, because your passion for that purpose is what draws
people to you as a leader. If you aren’t clear about your purpose, why
would others want to follow you?
For you as a leader, your purpose is the way you translate your
True North into making a difference in the world. For your
organization, purpose is the motivating force that binds people
together to drive the organization toward common goals. For
society, it is the way leaders and organizations contribute to better
lives for all people.
Ken Frazier: Medicine for the People
Ken Frazier has led his life with a clear sense of his True North. Now
CEO of one of the world’s leading pharmaceutical companies, he
has found great alignment between his True North and his organi-
zation’s mission. He said,
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Merck founder George W. Merck declared, “Medicine is for the people. It is
not for the profits.” On the organization chart, it looks like I’m in charge, but
every employee knows that George Merck quote by heart, and they look
constantly to see whether my actions are consistent with it. It’s aligned with my
personal sense of who I want to be and what I hope to contribute to the world.
Frazier has traveled a long road since he was born in inner-city
Philadelphia, overcoming many difficulties along the way. His grand-
father was born into slavery in South Carolina. His father was sent
north at age 13 to escape from indentured servitude but never had the
opportunity for formal education. “My father was by far the most
influential human being I have ever known,” said Frazier. “He was
self-taught, read two newspapers daily, and spoke immaculate
English.”
Frazier’s parents were deeply committed Christians with a faith
that carried them through the most difficult of times, just as it did for
him. His mother died unexpectedly when he was 13. He explained:
Our life was turned upside down, and we had to become more independent.
The day she was buried, my father told my siblings and me, “This is a good day
because your mother won’t suffer anymore.” That is what I call faith in action.
Since his father worked as a janitor, Frazier and his siblings had
to fend for themselves after school, avoiding the gangs that inhabited
the streets outside his house. “I learned very early frommy father that
one has to be one’s own person and not go along with the crowd.”
He taught me the most important lesson of my life: “Kenny, what are you to
do as the grandson of the man who started this narrative of being free and
being your own person? You better do what you know is right, and not be
fixated on what other people think of you.” I didn’t have to be popular, or feel
like I had to join a gang. I have experienced discrimination and know that life
is not fair, but feeling victimized gives one a sense of false power. You don’t
want bitterness to control you. That is the opposite of taking responsibility for
one’s own life.
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At 15, Frazier was appointed toWest Point but denied admission
because he was too young to be inducted into theU.S. Army. Instead,
he attended Penn State on a scholarship. While there, he decided he
wanted “to become a great lawyer like Thurgood Marshall, effecting
social change.” At Harvard Law School, he was acutely aware he
wasn’t from the same social class as his classmates. He wryly noted,
“Lloyd Blankfein [CEO of Goldman Sachs] and I were among the
few students who ‘were not of the manor born.’”
Defending Merck Science
Upon graduation, Frazier joined a law firm with an ethos of public
service, making partner at age 30. Once again, he found himself
crossing social barriers, observing, “I was an African American from
the inner city in a firm of people from the upper crust of Philadel-
phia.” Within his law firm, Frazier did lots of pro bono work,
including teaching at a law school to black lawyers in South Africa
in the midst of apartheid. He said, “My proudest moment came from
winning freedom for an innocent prisoner who was on Alabama’s
death row for 20 years.”
I was a stranger in a strange land. My first day in the courtroom, the bailiff told
me, “Down here we don’t wear blue suits,” which were reminiscent of the
Union Army. Next time I wore a gray suit. My client was one of the greatest
people I have ever met. He is such a hero to me because he has no recrimination
for having spent 20 years on death row. In that situation, you either become
consumed by bitterness, or rise to a different state of awareness.
When he joined Merck in 1992 as general counsel of its joint
venture with Astra, Frazier’s purpose shifted to using his legal skills to
help a company whose purpose is to create medicines that save lives.
After only a year, Merck CEO Roy Vagelos proposed making him
senior vice president of public affairs. Initially, he was not inclined to
accept the promotion until Vagelos persuaded him that he could do
much more for Merck than just be a lawyer. Six years later, Frazier
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was promoted to general counsel. There, he confronted 50,000
lawsuits filed by patients who used Vioxx after Merck voluntarily
withdrew the drug.
Frazier made the courageous decision to try the cases, one by one.
He noted:
These cases went to the heart of who we are as a company. When plaintiffs
alleged that Merck put profits ahead of safety, did low-quality science, and had
questionable integrity and commitment to humanity, we knew we had to defend
Merck science. We lost our first case in rural Texas, as the jury returned
breathtaking damages of $253 million for a single patient. The next day, the
New York Times read, Merck could find itself “bankrupt,” and they can
blame it all on the “ineptitude” of their lawyer. That was not a good day.
We learned from that experience and started winning cases. After we won
eight cases or so in a row, the judges told the parties to settle the remaining cases.
We eventually did, not for anything close to the estimated $30 to $50 billion the
plaintiffs were seeking, but for $4.85 billion. The New York Times called it a
brilliant litigation strategy. It wasn’t a litigation strategy at all, but a defense of
our science, our people, and Merck’s mission.
After Frazier spent a brief stint as Merck’s head of Global Human
Health, the board elected himCEO ofMerck on January 1, 2011. He
immediately reaffirmed Merck’s mission: “To discover, develop and
provide innovative products and services that save and improve lives
around the world.”
His strategy to fulfill the mission was to develop transformational
medicines and vaccines that focused on unmet medical needs. He
committed to spend a minimum of $8 billion per year on research
and development (R&D), just as archrival Pfizer and others were
paring back R&D staffs. Resisting shareholder pressure to cut
research, he invested in a new generation of drugs coming to market,
such as Januvia for diabetes, human papillomavirus vaccine Gardasil,
and Keytruda for melanoma. To concentrate on Merck’s mission,
Frazier sold the company’s consumer products business for $14
billion and acquired antibiotic maker Cubist Pharmaceuticals for
$8 billion.
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He concluded, “At Merck, you have the opportunity to make
tangible contributions to humanity.”
There’s a yearning in all of us to leave something meaningful behind, because
we know we have a short time on earth. Merck gives me the chance to leave
something to people 20, 50, or even 100 years from now because we did the
right things today. My purpose as CEO of Merck is to create an environment
where world-class scientists want to focus on the most important issues facing
mankind, such as our late-stage program for treating Alzheimer’s. The quality
of science in our industry is what separates the winners from the losers.
Frazier never forgot the influence of his father, “Looking back at
the days sitting at my father’s table, [I remember] he told me, ‘Believe
in yourself, and get up in the morning to help somebody.’ If he were
alive today, he would say, ‘The boy did what he was supposed to do.’”
Ken Frazier is proud of his roots, and he found his True North in
them: a call to serve. Frazier has focused on his leadership purpose in
multiple roles and used this purpose to invigorate a major global
pharmaceutical company. His contributions are genuinely a gift to
humanity, and his story is an inspiring one from which we can all
take hope and learn.
A Mentor’s Story
Frazier’s mentor at Merck, former CEO Roy Vagelos, carried out
founder George Merck’s passion for discovering lifesaving drugs for
two decades. He had been a medical researcher for 19 years when he
was asked to become dean of two prestigious medical schools, the
Universities of Chicago and Pennsylvania. Vagelos turned down the
opportunities because he believed being a dean was a dead end. “I
was horrified about becoming a dean, because you don’t teach or do
research; you just shuffle papers and push people around,” he
explained. Then he got an offer to lead Merck’s research.
I thought if I could use my knowledge of biochemistry to discover new drugs, I
could impact human health far beyond what I could do as a practicing doctor,
and I could possibly change the technology of drug discovery. I never thought of
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myself as being a leader, but asked myself instead if I was contributing
something to what’s going on in the world.
I first met Vagelos when he was selected for the U.S. Business
Hall of Fame for his leadership in eliminating the African disease
known as river blindness. Merck discovered a cure, the drug
Mectizan, but market projections indicated Africans could not afford
it. Vagelos took the courageous course of completing the drug’s
development and distributing it for free throughout Africa—until all
river blindness was eradicated. He explained, “Here’s a drug that can
prevent blindness in 18 million people. That single decision put
Merck in a position where we could recruit anybody we wanted for
the next decade.”
During the 1980s and early 1990s, Merck had the most produc-
tive record in producing lifesaving new drugs of any pharmaceutical
company, in large part because of the inspiration Merck’s researchers
drew from Vagelos’s passion and sense of purpose. Not surprisingly,
Merck’s shareholder value increased 10 times in 10 years. Now in his
mideighties Vagelos is still going strong. As chair of biotechnology
firm Regeneron for the past decade, he has guided the creation of
numerous breakthrough drugs using monoclonal antibodies—and
created $42 billion in shareholder value, a 6,700 percent increase.
“Given a choice of working just to make a living, or benefitting
the people of the world, the majority of people will choose the
latter,” Vagelos concluded.
What’s the Purpose of Your Leadership?
Most leaders find the purpose of their leadership emanates from their
life story. By understanding the meaning of key events in your life and
reframing them, you can determine your leadership purpose. Under-
standing your purpose is not as easy as it sounds. You cannot do so in
the abstract; discerning it takes a combination of introspection and
real-world experiences before you can determine where you want to
devote your energies.
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For some leaders, a transformative event in their lives inspires
them and lights the way to their purpose. Others, like me, require
many leadership experiences before discovering their purpose and
alignment with an organization where they can pursue it in an
authentic way.When you gain clarity about your purpose and find or
create an organization aligned with it, you are ready to make
important differences in the world through your leadership.
Often young leaders are too eager to get ahead and go for pro-
motions and titles rather than patiently wait to find their purpose.
When Avon’s executive vice president Andrea Jung was passed over
for CEO at age 39, her board member Ann Moore, then CEO of
Time Inc., gave her invaluable advice to “Follow your compass and
not your clock.” Jung decided to stay, and two years later she was
named CEO, a position she held for a dozen years. By the time she
became CEO, Jung’s purpose was clear: the empowerment of women.
She commented, “There is purpose in my work: enabling women to
be self-empowered, learn to run their own businesses, and achieve
economic means to provide education. At the end of the day, that
trumps all things.”
Dedicating Your Life to Public Service
Everyone who knew SethMoulton while he was an undergraduate at
Harvard College recognized his commitment to public service. He
delivered his class’s commencement speech, challenging his peers to
commit to service. But he didn’t just goad his classmates. After
graduating, he joined the U.S. Marine Corps, and served four tours
of duty in the Iraq War as an infantry officer.
Moulton’s choice surprised—maybe even infuriated—his liberal
parents, who had been opposed to the Vietnam War. They were
shocked that one of their children would want to join the military,
let alone fight on the front lines in Afghanistan or Iraq. Moulton
recalled his mentor, Reverend Peter Gomes, telling him, “Believing
in the right thing is not good enough. You have to go do it.”
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I first became aware of Moulton when he appeared in the
documentary No End in Sight, which criticized the handling of
the Iraq War up to 2007. I was struck by how he could be so loyal
to the military yet entirely honest in his criticisms of civilian leaders
in their execution of the war. Later, I got to know Moulton much
better when he was a George Leadership Fellow in the three-year,
joint-degree program betweenHarvard Business School and Harvard
Kennedy School. By then he had completed five years of military
service, working in later years directly under General David Pet-
raeus, who commanded all U.S. forces in Iraq. Moulton was intense,
thoughtful, and committed to serving his country.
After completing graduate school, he became project manager
for a high-speed rail venture in Texas. Moulton said that he had
“hoped to find the same sense of public mission in the private sector”
that he had experienced during his military service. However, the
project was constantly delayed by overseas investors, and after one
year on the job he resigned to pursue other opportunities.
Yearning to apply himself to a cause he could invest in fully, he
decided to run for Congress. “I want to serve in order to make a
difference,” he said. Just six months before the 2012 elections, he
began considering a long-shot campaign against an entrenched
Democratic incumbent in his home district on Massachusetts’s
North Shore, a race that many party elders advised him to avoid.
“I was disappointed that so many people discouraged me from
participating in the democratic process,” he said. “That democracy
was what we were fighting for every day in Iraq.”
Recognizing the futility of such a short campaign, he declined to
run, but was intrigued enough by the idea to consider running in
2014. Moulton officially announced his candidacy in July 2013, and
worked tirelessly for the next 12 months, getting to know his
constituents, staking out policy positions in speeches, and raising
money locally and nationally. In spite of his efforts, he still trailed the
incumbent in the primary by 30 points in the polls in late June. For
the next two months, he worked even harder to deliver his message
to the district’s constituents. On September 9, Moulton won by an
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11-point margin, taking an improbable victory after trailing by as
many as 53 points earlier in 2014. His election was the only
Democratic primary upset of the entire 2014 cycle.
In the general election, Moulton faced an experienced and well-
financed Republican who was considered by the Republican Party to
be one of their top prospects nationwide. Polling showed a close
race, but on Election Day Moulton emerged with a 56 to 41 percent
victory. In his victory speech, Moulton’s passion and voice rose as he
talked of Congress’s misunderstanding of the military and its lack
of support for veterans. “I am going to Washington to change that,”
he declared.
Although he is one of the youngest members of Congress,
Moulton is focused on making an immediate difference, by getting
the Veterans Administration back on track to help veterans return-
ing from Afghanistan and Iraq. Americans will hear a lot more from
Moulton in the years ahead. Congress needs more authentic leaders
like him who bring clarity of purpose to the public sector.
Opening up Opportunities
When Baxter Healthcare’s Michele Hooper was a child, she had a
close friend who lived on her street. One day, she went to her friend’s
house but was met at the door by her father. “He told me my friend
was no longer allowed to play with black children. That had a huge
effect on me. It was horrible.” The shock of that blatant discrimina-
tion stuck with Hooper and provided the impetus for her leadership.
After that painful experience, she was driven to excel academically.
“I planned to use my intellectual capacity as a stepping stone to get
ahead,” she said. Although she had no role models in the corporate
world, she decided to become a corporate leader because she excelled
at economics and business courses.
At Baxter, Hooper earned her first general management oppor-
tunity: to lead the turnaround of its Canadian operations. The work
was so stressful that she broke out in hives and acne. Yet, she said,
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“I could not quit because I was the first black female to run an
organization like that and first in my family to move into these lofty
executive ranks. I could not fail.” As she advanced in Baxter’s
leadership, she found her purpose: to be a role model for people
coming up and provide them opportunities. Hooper believes many
talented people never get opportunities they deserve because no one
recognizes their potential. “It goes back to my days when I was
rejected by my friend’s father,” she said.
You have to accept people for who they are. There are so many good people out
there. All they need is an opportunity and a platform. People gave me that in my
career and allowed me to take stretch assignments to grow in ways that I would
have never dared.
These stories reflect both the struggle that leaders go through in
discerning their purpose and the fulfillment they feel when they find
it and can share it with others. Ann Fudge sees leadership as serving,
not self-serving. She asked, “How can I use my talents to give back in
some positive way?”
Anyone can figure out ways to drive a business for two years, make a boatload
of money, and move on. That’s not leadership; that’s playing the game.
Leadership is leaving something lasting, whether it is how you treat people or
how you deal with problems.
Turning Purpose into Action
Your leadership purpose does not becomemeaningful until you apply
it to the challenges you encounter in the real world by bringing
people together around a common purpose.
Jim Wallis: Taking Faith to the Streets
Shortly before our interview, Sojourners founder JimWallis returned
from Ferguson, Missouri, where he had gone to meet with the young
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people who were leading the protests against their police depart-
ment’s racial bias and the faith leaders who were trying to support
them, speak to public officials, and bring people together. Wallis,
one of America’s leading religious figures engaged in social justice,
said his new book will be on race in America. He believes purpose
has little meaning unless it is translated into action:
My whole vocation is for faith to hit the streets in our work, our neighborhoods,
our nation, and the world. If it’s not a driving force in your life, it won’t be
sustained. Through Jesus, God hits the streets. That means religion has to have
a street test. We can talk and talk about religion, but if it doesn’t ever change
things on the street, it has little impact. In my courses at Georgetown, I ask
students, “How does your faith hit the streets?”
Wallis grew up in a white neighborhood of Detroit. As a
teenager, he was troubled by the disparities he saw in black sections
of Detroit just a few blocks away, concluding, “Something is terribly
wrong with my city and my country. I went into the city to find
answers.”
As a janitor at Detroit Edison, I became friends with young black guys, and that
changed everything. One day, I came back to my home church, where a church
elder told me, “Jim, you have to understand that Christianity has nothing to do
with racism; that is political and our faith is personal.” That’s the night I left my
church as a teenage kid. The issue of race was consuming me in my mind and
heart. I knew something was wrong, yet nobody would talk about it. I said to
myself, “If Christian faith has nothing to do with racism, then I want nothing to
do with Christianity.”
While studying at Michigan State University, Wallis got deeply
involved in civil rights and antiwar movements, and has been
arrested 20 times since in nonviolent civil disobedience for justice
and peace. He said, “As a radical student activist, I could put 10,000
people on the streets in about two hours.” In 1970, when tensions
over the Vietnam War and the gunning down of three students at
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Kent State University brought emotions to a boil, he led the student
strike that temporarily shut down Michigan State. His alma mater
awarded him an honorary degree 44 years later for his unwavering
commitment to social justice.
During college years,Wallis had his conversion experience when
he encountered Jesus’s words in the Gospel of Matthew, “Inasmuch
as you have done it to one of the least of these my people, you have
done it to me.” He explained:
Here is the Son of God saying, “I’ll know how much you love me by how you
treat them.” Them is the marginal, the vulnerable, the poor, the oppressed.
This is more radical than Karl Marx, Ho Chi Minh, and Che Guevara
combined. How we treat the poorest and most vulnerable is the real test of
our faith. The rest of my life has been trying to figure out the public meaning
of faith.
At Trinity Evangelical Divinity School, Wallis continued to
engage in social causes. He founded Sojourners in the early 1970s as
a faith-based social organization, network, and movement with the
mission of “Putting faith into action for social justice.” For the past
40 years, he has vigorously pursued that mission, never wavering in
his commitment to help the oppressed in society.
Wallis makes a sharp distinction between climbing the career
ladder and pursuing a vocation. He said, “Career is putting your skills
and assets on a resume, and trying to climb the rungs of the ladder of
success. Vocation is discerning your gifts and your calling. Your
vocation is your True North, what you’re called to do. Otherwise,
you’re working at some job, trying to advance on the career ladder,
and maybe engaging in your vocation in your extra time.”
Your vocation, which comes from the Latin word vocari, is where the crying
needs of the world intersect with your gifts. Rather than looking for opportuni-
ties to ascend, ask what are you called to be. If your vocation is just an
extracurricular activity, you’re in trouble. This difference between career and
vocation is central to your leadership. Your leadership is what you’re doing
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every day in your work and your relationships. When people ask how to find
their True North and their vocation, I tell them, “Trust your questions and
follow them wherever they take you.”
True to his calling, Wallis has taken his work to the streets of
South Africa, to the inmates at Sing Sing Correctional Facility, to
the poorest residents of inner-cityWashington, DC, and to President
Barack Obama in the Oval Office, never ceasing in his efforts to help
society’s underprivileged people. He has demonstrated enormous
courage in taking on powerful bodies, yet he refuses to be identified
with any part of the political spectrum. At the World Economic
Forum, he has advocated for a New Social Covenant. In part the
Covenant calls for “transformational, values-based leadership in
every field . . . We must engage the people . . . who will build
and leave behind a more just, generous, and sustainable world.”
Penny George: It’s Never Too Late to Become a Leader
My wife, Penny, never thought of herself as a leader, nor did her
parents encourage her to become one. Quite the contrary: They
discouraged her from taking the risks that come with leading. She
became a skilled organizational psychologist, valued by her clients for
helping talented individuals realize their potential. However, Penny
avoided organizational leadership roles, even on nonprofit boards.
Tragedy struck in 1996, shortly after she received her doctorate
in psychology, just as she and a partner were launching their new
consulting psychology firm. She recalled, “A day after a routine
mammogram I returned home from work to find a message on my
answering machine: ‘Penny, it appears you have breast cancer. Please
schedule an appointment with a surgeon.’”
Although her oncologist told her, “The goal is cure,” Penny went
on an emotional roller coaster, convinced she was going to die. She
opted for a modified radical mastectomy, followed by seven months
of chemotherapy and five years of hormonal therapy. Yet she had a
constant fear that the cancer would return. Unwilling to be passive,
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she experimented with many complementary therapies. She embrac-
ed rigorous lifestyle changes, including a new diet, exercise, and
stress reduction, tried herbal medications, and did psychotherapy to
reframe the difficulties of her teenage years. She found taking
responsibility for her return to wellness was profoundly healing
and restored her sense of control.
Shortly after her surgery, our son Jon canceled his spring vaca-
tion plans to come home to be with his mother. That personal
experience led to his decision to go to medical school. Today he is
emerging as an exceptional head and neck cancer surgeon at the
University of California, San Francisco, Medical Center, and is
deeply committed to his patients. His older brother, Jeff, has also
followed a path to a career in the medical field, and is currently
global head of Alcon, the worldwide leader in eye care, which is
owned by Novartis.
As part of her recovery, Penny went on an 11-day vision quest in
the barren Four Corners region of Colorado, including a 4-day solo
fast. After her return, she decided to concentrate her energies on
advancing integrative medicine. Her vision for a new way of
approaching medicine combined the best of traditional Western
practices with complementary therapies to treat the whole person,
just as she was doing for herself.
One day, as we were driving to Colorado, she told me with
determination, “We are going to change the way medicine is taught
and practiced.” Penny proposed that she run the family foundation
we had created in 1994. With the help of an exceptional foundation
director, she directed half our giving to integrative medicine.
Together they conceived an innovative idea to bring together
medical leaders of integrative medicine with philanthropists who
were funding in the area. This led to the formation of the Bravewell
Collaborative, a group of 25 foundations pooling their funding to
support the transformation of medicine.
Although her leadership of the collaborative was acclaimed by its
members, she kept insisting, “I am not a leader.”Why this dichotomy?
Rather than be the powerful out-front leader, she was quietly leading
from behind by encouraging individual members of this peer network
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to step up and lead. It was her passion and vision, coupled with the
values of collaboration, that inspired the group’s members. Her story
illustrates how discovering your passion can empower you to step up to
lead and find the purpose of your leadership.
Steve Rothschild: Finding His Calling
Sometimes in your career you will find that your work does not align
with your leadership purpose. At this point, you have to make a
choice: Either you find ways to bring your work into alignment with
your purpose, or you shift direction to find the opportunity that
enables you to fulfill your purpose through your work. That’s the
choice Steve Rothschild had to make.
Rothschild was a rising star at General Mills. He created the
Yoplait yogurt business in the United States and put it on course to
become a $1 billion business. Promoted to executive vice president
while still in his thirties, he facedmany new challenges, but after eight
years in this role, hebecame restless.He felt like a person in themiddle,
missing the satisfaction of leadinghis own team.He also disagreedwith
the company’s direction, judging it had to become more global.
His frustration came to a head when he was asked to present the
company’s international business strategy to its board of directors. “I
concluded we ought to be doing more internationally, because we
couldn’t rely solely on domestic growth,” he explained. While in
Spain on business, he got a frantic phone call from the company
president, who told him the CEO wanted to pull the recommenda-
tion to expand internationally. Rothschild replied, “I can’t do that
because I don’t believe it.” He explained, “The CEO wanted me to
heel, but never talked to me directly.”
Shortly after that incident, Rothschild faced the reality that he
was marching to a different drummer and wasn’t enjoying his work.
After some reflection, he decided to leave General Mills. “I was stuck
in a job I no longer enjoyed. I needed to feel alive again,” he said.
Leaving General Mills was a godsend for me. It allowed me to explore things
that were underneath my skin and in my soul and gave me the opportunity to
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refocus on my marriage and family. Since leaving, my relationships with my
family have become much closer and deeper. Making this move has made me a
more complete person, happier and fulfilled.
Having made the decision to get out of the frying pan at General
Mills, Rothschild decided not to jump back into the fire. Instead, he
gave himself the time and freedom to understand his passions and to
recognize he wanted to work on issues that meant something to him.
In the process, he shifted his priorities to helping underprivileged
people get back on their feet.
When you’re focused on something professionally for so long, you’re afraid to
let go. It’s like standing inside a giant hoop. When you let go a little bit, you do
so with one arm. You’re afraid to let go with two arms and fall out of the hoop
altogether, because you could fall flat on your face. In my case, I had to let go of
the hoop altogether.
He realized his passion was in helping underprivileged people
become financially self-sufficient and develop stronger families. Using
his own money, he founded Twin Cities RISE! Its mission is to
provide employers with trained workers by preparing unemployed
adults for skilled jobs paying fair wages.
My decision to start Twin Cities RISE! evolved out of the recognition that I like
solving meaningful problems. The challenges faced by underprivileged people of
color, many of whom have been incarcerated, weren’t being adequately
addressed. The nature of the problem shifted from building a business to
building lives.
Aligning Your Organization and Shared Purpose
Leaders don’t operate in a vacuum. Their responsibility is to bring
people together to pursue a shared purpose. Gaining alignment
around a purpose is the greatest challenge leaders face. Authentic
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leaders, such as Ken Frazier, convey such a sense of passion for their
purpose that the mission inspires people.
Cynics would say it is easy to create a sense of purpose when your
company is saving lives like Merck does, but what about the grocery
business? Kroger CEO Dave Dillon is a strong believer in creating
a purpose shared throughout the organization. Kroger may not
save lives, but it is a company where employees feel they are part of
something important. Dillon gained alignment around the proposition
that serving the public in a service-oriented grocery operation is a
dignified, proud profession. “All human beings want to findmeaning in
their lives. Our objective is to give them that meaning,” he said.
We have opportunities to make customers’ lives better by making them feel good
about the world around them because someone was friendly to them. Little
touches of human kindness can literally change their day. If I deliver that human
kindness, I wind up feeling better about myself as well. At the end of our
careers, we can look back and say, “I was part of something special.”
PepsiCo Chair and CEO Indra Nooyi has a clear vision of what
makes up a good company. She cited four characteristics: (1) returns
value to shareholders, (2) nourishes people and societies, (3) mini-
mizes its impact on the environment, and (4) cherishes its employ-
ees. Her multifaceted purpose expresses how organizations should
add value to all of their stakeholders. She said, “Every company has a
soul, made up of all the people who comprise the enterprise.”
Employees do not want to park their persona at the door. They want to work for a
company where they can bring their whole selves to work—a company that cares
about the world. Every good CEO has to remain focused on their True North.
Nooyi was born in Chennai, India, and attended Madras
Christian College and the Indian Institute of Management Calcutta
before immigrating to America in 1976 to attend the Yale School
of Management, where she received her master’s degree. After
working in strategy at several leading organizations, she joined
PepsiCo in 1994.
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When she was elected CEO in 2006, Nooyi foresaw that the
coming health crisis would lead people to shift to healthy foods and
beverages. So she embarkedona strategy tobroadenPepsiCo’s product
mix from primarily sugar-based drinks and high-fat foods to a much
better balance of healthy products, such as Quaker Oats, Gatorade,
Tropicana juices, and many newer health-oriented products.
She labeled her strategy “Performance with Purpose” to empha-
size the importance of achieving near-term performance targets
while the company was moving toward its long-term purpose. Nooyi
took major steps in executing this strategy, including making
acquisitions in emerging markets. In every meeting she had and
every speech she gave, she rallied PepsiCo’s 275,000 employees
around this common purpose.
Meanwhile, archrival Coca-Cola, led by Turkish-born Muhtar
Kent, focused primarily on Coke’s traditional soft drink brands. In
2009, Coke gained the upper hand when it captured the top two
spots in soft drink market share, leading to criticism of Nooyi for
neglecting Pepsi’s traditional strengths in soft drinks. Instead of
backing down, she beefed up Pepsi’s soft drink marketing while
continuing with her 2006 diversification strategy and made several
changes in her top management team. Her moves paid off in results
between 2011 and 2014 as PepsiCo regained lost share and broad-
ened its business. In those three years, PepsiCo handily outpaced
Coke as its stock price increased more than double its major
competitor.
Well after PepsiCo’s turnaround and the success of Nooyi’s
strategy was clearly established, activist investor Nelson Peltz
bought 0.7 percent of its shares and proposed that Nooyi abandon
her strategy. Instead, he demanded that she purchase Mondelez,
the spin-off of Kraft’s international business; combine it with
PepsiCo’s food business; and spin off its beverage business. Nooyi
was prepared for such an assault. PepsiCo’s internal analysis
attributed $1 billion in annual profits from the combination of
snacks and beverages. Nooyi held her ground and continued to
pursue her purpose-based strategy. In early 2015, Peltz agreed to
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drop his breakup campaign in exchange for PepsiCo adding the
former CEO of H. J. Heinz to its board.
Nooyi’s example demonstrates the importance of tenacity in
pursuing a clear mission, and aligning everyone around it, which is
essential to ensuring realization of the strategy. Naturally, there
will be setbacks, such as PepsiCo’s shortfall in 2009, and voices
calling for alternative approaches, as Peltz did. These are the test of
the depth of your belief as a leader in your purpose and in your
organization.
Keeping Your True North and Purpose in Sync
Your leadership purpose is how you activate your True North to
make a difference in the world. If you’re starting an organization, its
purpose should reflect your True North. On the other hand, if you
work in an organization that already has a mission, you need to find
congruence between your True North and the organization’s mis-
sion. If you cannot, you won’t find fulfillment from your work.
Looking back on Ken Frazier’s story, we can see he has aligned
his True North of serving others with Merck’s mission of medicine
“for the people.” Similarly, when I walked into Medtronic I felt
called by its mission of restoring people to full health. In both
instances, we were joining an organization that already had a strong
mission we believed in.
In other cases, the alignment is less strong. At PepsiCo, Indra
Nooyi sensed this, and as CEO, she ultimately made hard decisions
to change the mission and strategy of PepsiCo to emphasize the
company’s purpose in leading the shift to healthy foods and bever-
ages. Earlier in my career, I struggled to relate to the mission of
Honeywell and tried to use my executive role to improve the
company. When I realized Honeywell was changing me more
than I was changing it, I decided to move to Medtronic.
Occasionally, leaders find their work and the mission of their
organizations are incompatible with their True North. For instance,
Seth Moulton exited from the railroad company that had a paralyzed
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leadership structure and dysfunctional culture. Steve Rothschild left
General Mills because he could not relate to the company’s mission.
For many of us, how and where we apply our purpose evolves
throughout our lifetime—the thread William Stafford writes about
in the poem at the beginning of this chapter. Yet a constant source of
our purpose—our True North—stays the same as we navigate life’s
changes and new opportunities present themselves. As long as you
stay on the course of your True North, you are moving inexorably
through life with commitment and passion.
Exercise: The Purpose of My Leadership
In this exercise, you will focus on the purpose of your leadership and
how your purpose is derived from your life story, your passions, and
your motivated capabilities.
1. Recall your early life story (addressed in the exercises for Chapter 1
and Chapter 3), and use it to identify sources of the passions that
are close to your heart.
2. By reframing your life story, can you discern your passions more
clearly?
3. In what ways do your passions lead you to the purpose of your
leadership?
4. Write a letter to yourself describing the long-term purpose of your
leadership. For the near term, what is your purpose in leading? In
what ways does the purpose of your leadership relate to the rest of
your life? Is it integral to it or separate from it?
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11
EMPOWERMENT
Where is the spiritual value in rowing? The losing of self
entirely to the cooperative effort of the crew as a whole.
—George Yeoman Pocock, boatbuilder,
1936 Olympic gold medal winner
Leaders who make the transformation from I to We and know the
purpose of their leadership are able to develop an emotional
connection with their followers that gives them the credibility to
lead. They need the skills to empower people throughout their
organizations, especially first-line employees, around a common
mission and set of values.
In the past, many leaders relied on their positional power over
subordinates to drive performance. That hierarchical approach
rarely works with today’s employees, especially the younger genera-
tion of millennials, who are highly resistant to being directed by their
bosses. Instead, they seek leaders who inspire them and give them
the freedom to decide how they will achieve results.
Authentic leaders focus on building personal relationships with
people and empowering them to lead, each in his or her own way. In
the long run, empowerment is far more successful in developing
leaders, building healthy cultures, and achieving sustainable results
than the traditional hierarchical approach.
Anne Mulcahy: Empowering People in Crisis
Anne Mulcahy is an exceptional leader who was called upon to
lead Xerox through the greatest crisis in its history. Thrust into a
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position she never anticipated, Mulcahy demonstrated a remark-
able ability to rally Xerox’s 96,000 employees around a common
purpose. Her empowering approach not only averted bankruptcy
but also built the healthy culture that today her successor, Ursula
Burns, leads.
Back in 2000, becoming CEO of Xerox was the furthest thing
from Mulcahy’s mind. One day, as Mulcahy was preparing for a
business trip to Japan, chairman Paul Allaire came to her office and
told her he planned to recommend that the Xerox board terminate
its current CEO and promote her to COO and eventually CEO. She
was so shocked that she asked for the evening to discuss it with her
family. The next day she accepted the job.
The board’s decision surprised Mulcahy as well as everyone else.
In her 25 years at Xerox, she built a network of strong, trusting
relationships. She worked in field sales and on the corporate staff but
not in finance, research and development (R&D), or manufacturing.
At the time, she was enjoying her first general management assign-
ment, running a relatively small business outside the Xerox
mainstream.
It was like going to war, knowing it was the right thing for the company and
there was so much at stake. This was a job that would dramatically change my
life, requiring every ounce of energy I had. I never expected to be CEO, nor
was I groomed for it.
What no one understood was that Xerox was facing a massive
liquidity crisis and was on the verge of bankruptcy. Its revenues were
declining, its sales force had been unraveling, and its new-product
pipeline was depleted. The company had $18 billion in debt and its
credit lines were exhausted. Morale inside the company had plum-
meted, and its share price was in free fall. Xerox had just one week of
cash on hand, so its external advisers were recommending that the
company consider bankruptcy. Tomake matters worse, Xerox’s CFO
was preoccupied with a Securities and Exchange Commission
investigation into the company’s revenue recognition practices.
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As the situation moved from bad to worse, Mulcahy recognized
how high the bankruptcy risks were.
My greatest fear was that I was sitting on the deck of the Titanic and I’d get to
drive it to the bottom of the ocean—not exactly a moment to be proud of.
Nothing spooked me so much as waking up in the middle of the night and
thinking about 96,000 employees and retirees and what would happen if things
went south.
How did Mulcahy cope with this crisis when she had had no
financial experience? She brought strong relationships and an
impeccable understanding of the organization. She bled Xerox
and everyone knew it. To ameliorate the gaps in her experience,
she asked the treasurer’s office to tutor her on finance and surrounded
herself with a diverse set of leaders.
As she discovered the depth of the company’s problems,
Mulcahy’s purpose became clear: to save Xerox from bankruptcy
and restore it to its former greatness. Her challenge was to unite the
disheartened organization and get leaders throughout the company
to step up. “I get things done by identifying with the people in the
company and trusting them,” she said. “I care most about building a
good team to lead the company.”
Mulcahy met personally with the top 100 executives to ask
whether they would stay with the company despite the challenges
ahead. “I knew there were people who weren’t supportive of me,”
she said.
So I confronted a couple of them and said, “Hey, no games. Let’s just talk. You
can’t be thrilled. If you choose to stay, either we’re totally in sync or when you
go, it won’t be pleasant, because I have no appetite for managing right now.
This is about the company.”
The first two people she talked to, both of whom ran big
operating units, decided to leave, but the remaining 98 committed
to stay. They did so because they believed in Mulcahy. She also
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appealed to their character and to their desire to save the company
they loved.
Ursula Burns, who succeeded Mulcahy in 2009, expressed her
own loyalty to the company that had given her so much.
I have been to almost every country in the world. I have a wonderful life and
great friends, more than I ever imagined. It all came from a partnership between
me and this company. What do you say when times are tough? “Thank you
very much, I’ll see you later?” That’s not what my mother taught me.
After the initial conversations with Mulcahy, the team came
together quickly and was heartened by the number of their col-
leagues who stayed on. “We had dinner in the conference room off
the cafeteria,” said Burns. “We all looked around, pleased at how
many stayed, and said, ‘Okay, fine, we’re in this together. Let’s go.
What do we have to do to survive?’”
Instead of endless rounds of meetings at headquarters, Mulcahy
visited customers’ offices and rode with field salespeople to see
whether she could help stem the tide of customer defections and
field-sales resignations. She told the sales force, “I will go any-
where, anytime, to save a Xerox customer.” Her customer engage-
ment contrasted sharply with that of her predecessor, who rarely
traveled outside headquarters. It sent an important signal that
solidified the Xerox field organization and restored customer
confidence.
Yet Mulcahy was both challenging and demanding, holding
people publicly accountable for their results. Despite the tremendous
pressures the company was under, she set realistic expectations. “You
can’t wish your way to good performance,” she said. “If you set the
bar someplace that buys you 90 days of stock market esteem, you will
eventually get killed. Boy, is it ugly.”
She encouraged senior managers to engage each other directly.
“We talk about everything,” said Burns. “Anne is really clear: ‘Make
sure you get it.’” Mulcahy did not take the lead in every discussion,
playing instead what Burns described as an orchestrating role. “She’s
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very good at reading people,” Burns explained, “and getting us to
work together.”
The bankruptcy question came to a head inOctober 2000. Earlier
in themonth,Mulcahy candidly told the company’s shareholders that
Xerox’s business model was unsustainable. The next day, the stock
dropped 26 percent. She noted, “This was my baptism by fire.”
Mulcahy had traditionally drawn support by interacting with her
peers, but in her new role she had to provide her team confidence
that the company could survive—in spite of personal doubts she had.
“As a touchy-feely people person, the hardest thing was that my new
role required some distance I wasn’t prepared for.” Yet Mulcahy was
not immune from uncertainty and stress.
One day I came back to the office from Japan and found it had been a dismal
day. Around 8:30 PM on my way home, I pulled over to the side of the Merritt
Parkway and said to myself, “I don’t know where to go. I don’t want to go
home. There’s just no place to go.”
Have you ever felt like that? In my experience, feelings of
loneliness and despair are quite common for leaders, but most do
not have the courage to admit it. In times like these, you need the
support of your colleagues. Mulcahy explained, “I picked up my voice
mail and listened to a message from chief strategist Jim Firestone:
‘This may seem like the worst day, but we believe in you. This
company will have a great future.’” That was all Mulcahy needed
to drive home and come to work inspired the next day. “The team
gave me incredible supportive strength. We fight, we debate, but at
the end of the day, they’ve been extremely loyal and supportive.”
When the company’s external advisers argued that Xerox should
prepare for a bankruptcy filing to relieve the $18 billion debt burden,
Mulcahy exploded.
I told them, “You don’t understand what it’s like to be an employee in this
company—to fight and win. Bankruptcy’s never a win. I’m not going there
until there’s no other decision to be made. There are a lot more cards to play.”
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I was so angry because they could not comprehend the passion and drive that’s
required to succeed and the impact of bankruptcy on the company’s employees.
Our people believed we were in a war we could win.
Anne Mulcahy did win in the end. She staved off bankruptcy by
cutting billions in operating expenses without touching R&D or
field sales and by reducing debt by 60 percent. In launching 60 new
products with new color and digital technology, she restored revenue
and profit growth.
What distinguished Mulcahy’s leadership was her ability to
empower people to rise to the challenge and to keep them focused
on the shared mission of saving and restoring Xerox. Authentic
leaders, such as Mulcahy, recognize the collective power of an
empowered team far exceeds that of any single individual, and
they rally teams around a common cause.
The Engaged Leader
The capacity to develop close and enduring relationships is one mark
of empowering leaders. Unfortunately, many leaders of major com-
panies believe their job is to create the strategy, organizational
structure, and organizational processes. Then they delegate the
work to be done, remaining aloof from the people doing the work.
The detached style of leadership will not be successful in the
twenty-first century. Today’s employees demand more personal rela-
tionships with their leaders before they will give themselves fully to
their jobs. They insist on having access to their leaders, knowing that
it is in the openness and the depth of the relationship with the leader
that trust and commitment are built. Bill Gates, Steve Jobs, and Jack
Welch were so successful because they connected directly with their
employees and realized from them a deeper commitment to their work
and greater loyalty to the company. Welch, in particular, was an
interesting case because hewas so challenging and hard on people. Yet
those very challenges let people know that he was interested in their
success and concerned about their careers.
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In Eyewitness to Power, David Gergen writes, “At the heart of
leadership is the leader’s relationship with followers. People will
entrust their hopes and dreams to another person only if they think
the other is a reliable vessel.” Authentic leaders establish trusting
relationships with people throughout their organizations. The
rewards of these relationships, both tangible and intangible, are
long lasting.
Woody Allen once remarked, “Eighty percent of success is
showing up.” Surprisingly, many leaders get so busy that they
don’t take the time to be there for people. They don’t bother to
attend award ceremonies, company picnics, or sales meetings. Nor
do they walk around the offices, factories, labs, and field sales and
service locations. Often they are too busy to come to important
customer meetings or trade shows. As a result, their teammates never
get to know them personally. Their only contact with their leaders is
through impersonal media, such as speeches, voice mail, videotapes,
and Web streaming of company events.
Target CEO Brian Cornell makes frequent visits to stores around
the country, often going alone and unannounced, shaking hands and
getting to know people, as well as using his astute powers of
observation to see how effective Target team members are in
connecting with their guests. These visits have given him a clear
understanding of his new organization and what needs to be
improved. It also led to what he termed “the most difficult decision
of my career”—to close his predecessor’s ill-fated foray into Canada.
Not only did Cornell have multiple business analyses prepared to
search for a way forward, but he also visited nearly empty stores the
week before Christmas and realized that Target’s efforts should focus
entirely on the lucrative U.S. market.
Likewise, Howard Schultz told of visiting a Starbucks store one
Saturday morning:
I walked in, dressed so nobody would recognize me. When I sat down, the
manager came up and said, “Howard, is that you?” I said, “Yes, it is.” She told
me about receiving Starbucks stock and what it did for her and her family. Then
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she started crying and said, “I’m so moved that you’re in my store.” Later I got
a voice mail from her, saying how powerful that moment was for her. I
immediately called her back and thanked her for sharing with me.
Stories of basic human interactions like this one are very
powerful. All Cornell and Schultz had to do was show up. Being
at important events or engaging on the front lines at unexpected
times means a great deal to people and enables them to take their
leaders off their proverbial pedestals and see them as real people.
Mutual Respect: The Basis for Empowerment
To bring out the best from teammates, authentic leaders must
develop trusting relationships based on mutual respect. There is
no substitute. Like loyalty, respect provides a basis for empowerment,
but leaders must earn it. Here are some of the things empowering
leaders do to gain the respect of their colleagues:
• Treat others as equals
• Listen actively
• Learn from people
• Share life stories
• Align around the mission
Treat Others as Equals
We respect people who treat us as equals, especially when they are
successful investors, such asWarren Buffett. He has the same sandwich
andCherryCoke combinationwith a group ofwide-eyed students as he
does with his close friend Bill Gates. Buffett does not rely upon his
image to make people feel he is important or powerful. He genuinely
respects others, and they respect him as much for those qualities as for
his investment prowess. By being authentic in his interactions, Buffett
empowers people to lead in their own authentic way.
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Listen Actively
We are grateful when people genuinely listen to us. Active listening
is one of the most important abilities of empowering leaders,
because people sense such individuals are genuinely interested
in them and not just trying to get something from them. Warren
Bennis was an example of a world-class listener. He patiently
listened as you explained your ideas and then thoughtfully con-
tributed astute observations that came from a deep well of wisdom
and experience.
Learn from People
We feel respected when others believe they can learn from us or ask
for our advice. The best advice I ever got about teaching came from
my Harvard Business School (HBS) colleague Paul Marshall, who
was one of HBS’s greatest teachers. He told me, “Bill, don’t ever set
foot in an HBS classroom unless you genuinely want to learn from
the students.” I have taken his advice into every class I have taught
for the past 12 years, telling MBA students and executives, “I feel
certain I will learn a lot more from you than you do from me.” The
students find that hard to believe at first, but they soon see how
their feedback helps me understand how today’s leaders and MBA
students think.
Share Life Stories
When leaders are willing to be open and share their personal stories
and vulnerabilities, people feel empowered to share their own stories
and uncertainties in return. On Thanksgiving eve in 1996, I sent an
e-mail to all Medtronic employees, expressing my gratitude for the
support Penny and I received following her ordeal with breast cancer
and chemotherapy. We were overwhelmed by the number of people
who spontaneously shared their stories with us.
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Align around the Mission
The most empowering condition of all is when the entire organiza-
tion aligns with its mission, and people’s passions and purpose
synchronize with each other. It is not easy to get to this position,
especially if the organization has a significant number of cynics or
disgruntled people. Nonetheless, it is worth whatever effort it takes
to create an aligned environment, including removal of those who
don’t support the mission.
Individuals usually have their own passions that drive them. If
the organization’s leaders can demonstrate how employees can fulfill
their purpose while achieving the organization’s mission, then
alignment can occur. Authentic leaders empower others to use their
gifts and step up to leadership, regardless of their titles or roles in the
organization.
Several years ago, I visited Medtronic’s heart valve factory in
Southern California, where employees reconfigure valves from pig
hearts to replace failed human heart valves. The process requires
extremely skilled workers because it is more art than science. On the
factory floor, I met the top producer, a Laotian immigrant who made
a thousand valves a year. When I asked her the key to her process,
she looked at me with passion in her eyes and said, “Mr. George, my
job is to make heart valves that save lives.”
Before I sign my name to a completed valve, I decide whether it is good enough
to put in my mother or my son. Unless it meets that standard, it does not pass. If
just one of the valves I make is defective, someone may die. To the company
99.9 percent quality may be acceptable, but I could not live with myself if I
caused someone’s death. But when I go home at night, I fall asleep thinking
about the 5,000 people who are alive today because of heart valves I made.
Can there be any question that she is a leader among her peers?
She has a passion for her work that is tied directly to the company’s
mission, she sets high standards for herself, and she sets an example
for everyone else to emulate. That’s the kind of leader we need at
all levels.
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Creating an Empowered Culture
How do leaders create a culture that infuses empowerment through-
out the organization? It starts with how the leaders on top behave
every day. They cannot preach empowerment and then behave in a
hierarchical manner to get near-term results, or they lose credibility
with their colleagues. Nor can they reward or even tolerate power-
driven managers who behave like jerks to get results and often play
political games in their organizations. These people need to be
moved out of the organization for the culture to be internally
consistent with empowerment. Then they need to reward leaders
at all levels who empower their colleagues and subordinates and
recognize them publicly.
Empowering leaders engage actively with their colleagues by
counseling them, offering suggestions, or assisting them in making
vital contacts. For example, as CEO of Merck, Roy Vagelos ate
regularly in the company cafeteria, where he asked people about
their work and the challenges they were facing. He took notes about
the conversations and then thought about the specific problems for a
few days before calling the employees back with his ideas.
Imagine howMerck researchers must have felt when they picked
up the phone to hear Vagelos getting back to them. “I’d call them up
and say, ‘That’s a tough problem, but here are a couple things you
might try,’” Vagelos said. “People love to have involvement of the
leader. They feel you want to help them and are part of the solution.”
These interactions reinforced the importance of the researchers’
work and had a multiplier effect upon employees.
Marilyn Carlson Nelson: From Sweatshop to
Empowerment
Carlson chair and CEO Marilyn Carlson Nelson dramatically trans-
formed the company founded by her father, Curtis Carlson. Carlson
was a consummate salesman and a tough, demanding boss. Seeing
her leaving the office at 7:30 one night, Carlson asked his daughter
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whether she had lost her enthusiasm for the business. “Monday
through Friday are about staying even with the competition,” he
often said. “Saturday is when you get ahead.”
The elder Carlson taught his daughter about business but didn’t
encourage her to join the company until her children were grown,
believing that the workplace was not meant for mothers. After
giving birth to her first child, Nelson worked from her home as
publisher of Carlson’s employee newspaper and was promoted to
department head. When she told her father, his response was blunt:
“You’re getting too involved in the business. You should be at home
with your children.”Added Nelson, “My father fired me on the spot.
I left the building with tears running down my face.”
While raising her family, Nelson got deeply involved in the
Minneapolis community, chairing the Minnesota Orchestral Asso-
ciation, creating a “Scandinavia Today” celebration and bringing
the 1992 (and later the 2018) Super Bowl to Minnesota on the
coldest weekend of the year. She also became the first woman to
serve on the boards of major local corporations and was coowner of a
rural bank. As her business profile rose, her father repeatedly rebuffed
her interest in the family company.
When her last child went off to college, Nelson finally rejoined
Carlson at age 48. In her first month, she accompanied her father to a
presentation by MBA students at Minnesota’s Carlson School about
their research into Carlson’s corporate culture. Nelson recalled
asking how the students saw Carlson. No one dared to answer.
Finally, one student said, “Carlson is perceived as a sweatshop that
doesn’t care about people. Our professors don’t recommend we work
for Carlson.”Nelson was stunned. “That meeting lit a fire under me,”
she said. She realized then she needed to shift the corporate culture
away from her father’s top-down, autocratic style.
When Nelson’s brother-in-law abruptly departed as CEO two
years later, her 80-year-old father returned to active management.
Nelson took on more prominent operational roles but still was not
designated as successor. Meanwhile, key executives left the com-
pany, frustrated by Carlson’s command-and-control style. Eventually,
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Nelson assumed responsibility for key Carlson divisions and began to
reshape the company’s leadership and strategy.
At the celebration for her father on the company’s sixtieth
anniversary, she was finally named CEO. Undaunted, Carlson
cautioned his daughter against relying on others. “Be very careful,”
he told her, “You can’t trust anyone besides yourself.” Nelson had
just the opposite point of view, feeling that trust would work in a
caring environment. “If you create a supportive environment, you
can attract people who are trustworthy, so long as you trust them and
you are trustworthy yourself,” she explained.
Nelson transformed a fear-driven culture into a more supportive
culture by focusing on employees and customers. “In the command-
and-control environment,” she explained, “my dad robbed himself of
the opportunity to hear contrarian views.”
The contrarian view forces you to either understand or change your position. I
moved to a collaborative mode of management. Now we rely on everybody to
bring their wisdom and experience to bear on decisions. I believe that collective
wisdom has great value when it comes from solid thinking. Ultimately, the
leader still has to make the final decision.
Nelson decided to reinvent Carlson as a company that cared for
customers by creating the most caring environment for its employ-
ees. She shifted emphasis away from stewardship of financial capital
toward acquiring and cultivating human capital. She looked for
three characteristics in employees: character, competence, and
caring. “The need for character as absolute trustworthiness, and
competence in the form of global experience, expertise, and judg-
ment, are not surprising,” Nelson explained, “but the characteristic
of caring was not self-evident.”
I looked for people who had “a servant’s heart.” Servant leadership is an
important driver of the culture we want to create. Satisfied employees create
satisfied customers. In the service business, customers understand very quickly
whether you legitimately care about serving them.
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Nelson recognized these values had to be embraced by Carlson
locations worldwide if they were to become key behaviors for every
Carlson employee. She traveled tirelessly to meet with company
employees and customers around the world. “We can build relation-
ships only if employees are affirmed and empowered, have clarity of
direction, and understand the company’s mission,” she said. “We
cannot just teach restaurant employees to put a meal on the table.
They have to customize the experience depending on whether
customers want privacy or an evening of fun.”
Reflecting on the changes she led at the company, Nelson
proudly said that no MBA student today could conclude that
Carlson does not care about people. “You cannot change a culture
in six months,” she explained. “It takes time to build transparency
and collaborative discussion into the culture.” Having suffered from
her daughter’s death 20 years before, Nelson reaffirmed her personal
mission “to use every tool at hand as an opportunity to give back or
make life better for people.” Her transformation of Carlson’s corpo-
rate culture to a collaborative environment is a remarkable example
of how leaders can inspire employees around a common vision and
empower them to lead.
Kent Thiry: The Mayor of DaVita
To outsiders, the culture of DaVita, which runs kidney dialysis
centers, appears highly unusual, perhaps even a bit weird. Company
meetings are filled with sports-event-like cheers and skits, and CEO
Kent Thiry runs around in aThreeMusketeers costume, brandishing a
sword. Even Thiry acknowledges, “People new to the village think
these practices are cheesy, foolish, and superficial.”
Every country has sports teams, military organizations, and religious groups
with their own chants, cheers, songs, and slogans. It isn’t the DaVita culture
that is weird, but rather the companies that have emotionally sterile environ-
ments that don’t inspire people in their work. Given the percent of people’s lives
spent at work, why shouldn’t it be fun and fulfilling at the same time?
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Thiry’s approaches to creating an empowering culture emanated
from his unfortunate experience of liquidating his previous com-
pany, Vivra Specialty Partners (VSP). Physically and emotionally
drained, Thiry believed the failure of VSP marked the end of his
private-sector career. He and his wife, Denise O’Leary, agreed to take
time off from their careers to devote their energy to their family.
When Thiry was offered the opportunity to lead DaVita a few weeks
later, his wife was furious. “That is a disgustingly testosterone-driven
idea!” she exclaimed. So he turned it down initially. When she saw
how depressed he was, she told him, “You’re a head case. Just go do
the darn thing.”
When Thiry became CEO of DaVita, he recognized the emo-
tional challenges his employees faced working in dialysis centers
where patients spent an average of 12 hours per week and 20 percent
died each year, even with the best care available. Thus, he sought
ways to create an upbeat, communal atmosphere in each center and
a deep sense of caring between patients and DaVita employees.
Throughout DaVita, he wanted to create a differentiated orga-
nization that behaved like a community, where people supported
each other and felt the same passion for their workplace as they did
for their churches and local sports teams. Thiry wanted to replicate
the community he found in the old-style, small Wisconsin town
where he grew up. He gave himself the title of Mayor of DaVita and
adopted themes from his favorite movie, The Three Musketeers.
Hearing Thiry speak often about his company’s culture, I decided
to experience it firsthand. I quickly saw the exceptionally high level
of passion, enthusiasm, and commitment on the part of every DaVita
employee I met. Rather than judging DaVita’s culture as different, I
found myself agreeing with Thiry’s contention that it is the emo-
tionally sterile culture of many companies that is weird.
Just as we created a strong sense of community built around
patients at Medtronic, I asked myself, “Why shouldn’t all companies
do the same?” Multiple surveys by Gallup have shown that only
30 percent of employees are engaged with their work. That’s a
disaster and tragic loss of human potential. No wonder so many
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employees feel burned out and turnover is so high. Think what
inspiring workplaces we could have if most companies created
empowering working environments like Carlson and DaVita have.
Tony Hsieh’s Radical Transparency
As CEO of Zappos, Tony Hsieh has a maniacal focus on culture.
Zappos is the only shoe retailer in the world that has created tours of
its call center because of the constant demand of business leaders
who wanted to see the zany, exuberant, and customer-obsessed
culture in action. Hsieh built the entire business on clear values
and purpose. He communicates openly and often with everyone in
the company, particularly front-line employees. In a company-wide
e-mail he sent in November 2008 following a layoff, he wrote:
Remember this is not my company, and this is not our investors’ company. This
company is all of ours, and it’s up to all of us where we go from here. The power
lies in each of us to move forward and come out as a team stronger than we’ve
ever been in the history of the company.
In good times and bad times, Hsieh’s communications are
authentic, funny, and informal. He speaks directly and personally
to his colleagues. His relentless focus is on the values that allow the
company to create incredible customer service with few rules and
little bureaucracy constraining Zappos employees. For instance, most
call centers measure employee performance on average handle time
to reduce call length and maximize productivity. Zappos eliminated
this metric as well as call scripts and upsells to enable their employees
to connect directly with customers and deliver better service.
Hsieh’s empowerment of employees has unlocked incredible
potential in the organization. He said if you get the culture right,
everything else falls into place. As a result, Zappos grew rapidly for
10 years until its $1.2 billion acquisition by Amazon.com in 2009.
Leaders like Mulcahy, Nelson, Thiry, and Hsieh have discov-
ered that empowering people throughout their organizations with
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passion and purpose delivers far superior results than what can be
accomplished by forcing subordinates to be loyal followers. By
giving others the latitude to lead within the organization’s broad
purpose, they are able to delegate more of their leadership respon-
sibilities while expanding the impact of their leadership to more
people.
Empowerment Is Accountability
The term empowerment is often misunderstood as “freedom to do
your own thing.” Actually, real empowerment must be accompa-
nied by a high degree of accountability to deliver on your com-
mitments. I encountered this misunderstanding when I first joined
Medtronic and spoke frequently about creating a culture of
empowerment. One day, I was confronted by a senior executive,
saying it was not very empowering for me to challenge her results.
Several weeks later, she came back and said, “Now we understand
you better. When you talk about empowerment, you really mean
‘empowerment with accountability,’” to which I responded, “Is
there any other kind?” Successful leaders are closed-loop managers
who follow up regularly with their team to ensure they are getting
results and provide assistance as needed.
Alan Mulally: Empowerment with Closed-Loop
Accountability
Alan Mulally is an empowering leader who brings his team together
to gain agreement on goals and objectives yet is rigorous in following
up to get candid reports on progress. Throughout my career, I have
heard middle managers who don’t respond well to careful monitoring
classify Mulally’s approach as “micromanagement.” I disagree.
Empowered leaders must be wholly accountable for their actions
and transparent about their results, or the results are anarchy and
politics, both of which lead to poor performance.
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In 2006, Mulally arrived at Ford from Boeing as the new CEO,
wearing a sport coat and slacks, attire quite distinct from Ford’s
buttoned-up executives. He noticed when he drove into the com-
pany parking garage that there were no Fords in the garage, strange
for a company whose eponymous auto was also its largest seller. He
was immediately escorted up to his enormous office, where a cadre of
aides—a total of 30—greeted him, offering to take his coat and pour
his coffee. Within a month, they were all gone, replaced by the
assistant who came with him from Boeing.
Walking into the enormous office that Henry Ford II once
occupied, Mulally gazed out the panoramic windows at the Rouge
Plant, the automobile industry’s most famous factory. After telling an
aide he would like to walk through the plant andmeet the employees,
he was informed that “our executives don’t talk directly to factory
employees.” With that, he insisted on going there immediately.
Mulally’s initial meetings convinced him that Ford’s problems were
far deeper than the staggering losses projected for the year. An
intuitive leader who knows far more than he lets on, Mulally under-
stood he was facing a broken culture requiring a massive overhaul.
Born in Kansas and true to his roots, Mulally lacks pretension and
approaches people with a warm, “aw shucks” demeanor that immedi-
ately puts people at ease. At Ford, Mulally’s style was low-key and
down-to-earth—a marked contrast with the air of sophistication and
palace court politics that preceded him. He wrote notes with smileys,
engaged in casual conversations, popped intomeetings unannounced,
and often offered hugs.Many of Ford’s executives underestimated him
at first, describing his approach as corny. As Bryce Hoffman describes
Mulally in American Icon, the definitive book on his turnaround of
Ford, “Mulally’s character was an odd mix of guilelessness and
relentless determination that was born of an austere childhood and
a lifelong desire to write his name across the sky.”
Mulally joined Boeing in 1969 and worked his way up to head
of its troubled commercial aviation division, leading a spectacular
turnaround that positioned him to become Boeing’s next CEO.
Yet the forced resignations of CEOs Phil Condit and Harry
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Stonecipher for misconduct caused the Boeing board to go outside
its ranks to recruit 3M’s CEO, Jim McNerney, as its new CEO.
Even then, Mulally bled Boeing blue. Only a personal telephone
call from Bill Ford, great-grandson of Henry Ford, could have opened
up his thinking to a career change. After extensive discussions with
Ford and his board members, Mulally declined the Ford CEO role in
favor of staying at Boeing. Eventually Ford board members persuaded
him to accept the challenge of saving one of America’s most iconic
companies.
It didn’t take Mulally long to realize the depth of Ford’s
problems. In spite of $12.7 billion in losses, the largest in Ford’s
history, nobody on Mulally’s new executive team was willing to
acknowledge its problems. Mulally told me that the company—
along with its Detroit competitors, General Motors and
Chrysler—had been going out of business for the prior 30 years,
yet no one was willing to face that reality. Realizing decisive
action was required to give Ford a cushion against further
problems and economic downturns, Mulally approved a plan to
borrow $23.5 billion, leveraging Ford’s entire balance sheet and
the iconic Ford oval as collateral.
Mulally then established a strategy of meeting customer needs
with a complete lineup of superior cars and trucks—not just sport
utility vehicles and trucks—while insisting that Ford’s factory costs
in its unionized U.S. facilities had to be equivalent to nonunion
factories in the South. This required a landmark agreement with the
United Automobile Workers involving half-wage positions to bring
the production of midsize autos back to Michigan, which the
company’s unionized workforce ratified in 2007. Meanwhile,
Mulally narrowed the company’s brands to Ford and Lincoln while
spinning off luxury brands, such as Jaguar and Land Rover.
At a weekly business performance review (BPR), Mulally
brought together his direct reports for a full day of in-depth, fact-
based reviews of Ford’s business. During these meetings, he dove into
the details several levels deeper than any senior executive had done
previously and expected candid appraisals. He used a green, yellow,
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and red color coding system to assess the status of key projects. Given
the depth of the company’s problems, he was puzzled when every
project was coded green.
At his fifth BPR, he confronted his team about the dichotomy
between billions of losses and their consistent reports of positive
progress. “Is there anything that’s not going well here?” he asked.
Nobody responded. The following week, Americas president Mark
Fields faced reality with a red indication that a key new vehicle
launch had to be held up. Although Fields’s colleagues all thought he
would be fired, instead Mulally clapped, saying, “Mark, that is great
visibility.” Mulally not only accepted problems but also consciously
shifted the focus to problem solving. He echoed the same encourage-
ment throughout his conversations: “You have a problem . . . You
are not the problem.”
Remarkably, Mulally made few personnel changes upon assum-
ing the CEO position. Rather, he changed the culture by getting
each leader immersed in the details of the business and working
like a team to improve performance. One of those executives,
International president Mark Schulz fiercely resisted Mulally’s
approaches, refusing to get into details and calling in sick for
meetings, in part because he thought he could do an end run to
chairman Bill Ford. It didn’t work. Schulz was the first member of
Mulally’s team to go.
Turnarounds such as Ford’s do not occur by happenstance.
Leaders set the vision and then empower their teams to achieve
it. Mulally rallied Ford employees with openness and candor. He
never asked more of team members than he was willing to give
himself. He had a unique ability to combine genuine caring for his
people with real accountability for their results. His brand of tough
love involved both toughness and caring: He was tough enough to
transform Ford’s executive suite and caring enough to empower
senior leaders and rally Ford’s employees around a new vision for
global competitiveness.
What happened to Mark Fields, the executive who came clean
about his problems? He became Mulally’s successor in 2014.
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Your Leadership Style
The topic of style has been saved for last because the style of an
effective leader must come from an authentic place. That can
happen only when you have a high level of self-awareness, are clear
about your values, and understand your leadership purpose. Your
style should be the outward manifestation of your authentic leadership.
Style without authenticity makes you a persona. Without this
clarity, your style will be shaped by the expectations of your
organization or the outside world and will not be seen as authentic.
Nor will it be empowering to people.
Many organizations work hard to get young leaders to embrace the
company’s normative leadership style, sending them to training pro-
grams to bring their styles into line. Therein lies the risk:Will you have
to compromise who you are to succeed in the organization? If you
do, you will feel like an imposter, trying to be something you are not.
One of the most important observations about the empowering
leaders profiled in this chapter—Anne Mulcahy, Roy Vagelos,
Marilyn Carlson Nelson, Kent Thiry, Tony Hsieh, and Alan
Mulally—is that they all have unique styles that work effectively
for them. None of us could ever succeed by emulating their styles.
In thinking about your leadership style, ask yourself these
questions, and consider where you fit among the categories shown
in Figure 11.1:
• Is your leadership style consistent with your leadership principles
and values?
• How do you adapt your style to the circumstances facing you?
• Are you concerned whether your authentic style will be accept-
able in your organization?
• Do you worry that you may have to modify your style to get
ahead?
The directive style of leadership was common in the past,
especially in military and manufacturing operations. It is still needed
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during crises when time is of the essence. As more companies are
built on knowledge workers, however, the directive style has proved
ineffective in motivating people to take initiative or be creative.
The most common style to emerge in recent years is the engaged
style. Leaders such as Anne Mulcahy and Alan Mulally are actively
engaged with people at all levels of the organization—questioning,
listening, motivating, and encouraging them to perform at a higher
level—but alwayswithin the organization’s shared purpose and values.
Coaching leaders, such as John Donahoe of eBay, bring out the
best in people and develop them for future leadership roles. Usually
such leaders are more concerned with people’s development to
achieve long-term results than they are with immediate outcomes.
Consensus leaders treat everyone on the team as equal and encour-
age everyone toparticipate indecisionmaking.They are quitewilling to
take the time to reach conclusions, even to the point of postponing
decisions, until a consensus emerges.Most nonprofit organizations need
consensus leaders to motivate the various constituent groups.
Affiliative leaders build bonds of trust among people by keeping
harmony among team members, even at the expense of near-term
results. These leaders are often most effective at bringing out the best
in their teammates by leading in subtle and restrained ways.
Expert leaders, such as Craig Venter, rely heavily on their own
knowledge and expertise. They are often found in scientific organi-
zations, consulting, and financial services, where individual stars rise
to leadership positions. They tend to listen to other experts while
demanding that their teammates exhibit equally high levels of
knowledge and individual performance.
Figure 11.1 Leadership Styles
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Within your authentic leadership, a range of styles is both
effective and appropriate for the situation. You should adapt your
leadership style to the capabilities of your teammates and their
readiness to accept greater responsibility. For example, if your
teammates need clear direction, they may not be ready to respond
to a consensus style. Conversely, creative or independent thinkers
will not respond positively to a directive style.
In leading, it is important to understand the situation in which
you are operating, as well as the performance imperative, and have
the flexibility to maximize your effectiveness in that situation.
As Narayana Murthy said, “Leadership must always be put in a
context. If you take the best corporate leaders and make them
senators or president, they may not succeed because that is a different
context.”Once you understand the context, however, you can adjust
your communication and leadership style to get results yet retain
your authenticity.
Selecting Your Altitude
Kevin Sharer’s experience at MCI taught him the value of a flexible
leadership style, one that could vary with the needs of the business and
the readiness of his team to operate autonomously. He describes style as
the appropriate “altitude” for the level of specificity of the task at hand:
At the highest altitude, you’re asking the big questions: What are the company’s
mission and strategy? Do people understand and believe in these aims? At the
lowest altitude, you’re looking at on-the-ground operations: Did we make that
sale? What was the yield on the last lot in the factory? In between, you ask
questions like: Should we invest in a small biotechnology company that has a
promising new drug? How many chemists should we hire this quarter?
As a CEO, you’ve got to function at all of these levels simultaneously. I
learned from Jack Welch the skill of rapidly shifting between levels, or even
engaging several levels at once. Most CEOs tend to gravitate toward the
altitude where they’re most comfortable. Unfortunately, they get in trouble
because they get stuck at a particular altitude.
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Sharer acknowledged his own tendency to be preoccupied by the
nitty-gritty details of a problem:
When I go into my submarine mode, I go very deep into a problem and think
I can solve it myself. That’s when I’m at risk of ignoring advice of experts and
closing down debate. Moving nimbly in and out at different altitudes is crucial
to leadership success, particularly in times of rapid growth and uncertainty.
As a leader, you should adopt a style that fits your personality but
be flexible enough to adapt to the situation and the needs of your
colleagues. Only in this way can you maintain your authenticity and
empower people through a range of challenges.
Exercise: Empowering Other Leaders
1. Describe an example from your past where you have been
effective in inspiring other leaders around a common purpose
and shared values.
2. How effective are you today at empowering other people to step
up and lead? How do you go about doing this? What are you
doing to improve your effectiveness?
3. Recall a situation in which you faced a conflict between empow-
ering other people and reaching your performance goals.
a. How did you resolve the conflict?
b. Did you give preference to reaching your goals or to your
relationships?
c. Would you act differently in the future when facing a conflict
between relationships and performance?
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12
GLOBAL LEADERSHIP
The organization model of a global company by 2020
is going to be very different than the traditional
Western model. The culture that comes
with it must be entirely different.
—Paul Polman, CEO, Unilever
In this final chapter, we examine the challenges of leading in
the global world. Corporate leaders recognize that today’s inter-
connected and global world requires that they have new competen-
cies. In global roles, you will be asked to demonstrate geopolitical
savvy, reinvent business models for emerging markets, build diverse
teams, and redesign organizational models. Thriving in this complex
environment requires qualities above and beyond those of authentic
leaders. To help you prepare for global leadership, we introduce the
concept of global intelligence, or GQ, and explore how to develop
the traits of GQ leadership.
Paul Polman: Transforming Unilever’s
Global Leadership
Under the leadership of CEO Paul Polman, Unilever has trans-
formed itself into the leading global consumer products company.
Polman was born and educated in theNetherlands. He spent 26 years
with Unilever’s archrival, Procter & Gamble, many of them in
the United States and Europe, and then three years with Nestlé
as CFO and head of the Americas. As the first Unilever chief execu-
tive recruited from outside the company, he faced a challenging
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turnaround when he became CEO in early 2009. For two decades,
Unilever’s revenues, profits, and market capitalization had been
declining. In his interview for this book, Polman observed, “We had
forgotten how to win in the marketplace.”
Unilever was founded in 1929 through the merger of British soap
maker Lever Brothers and Dutch margarine producer Margarine
Unie. As an Anglo-Dutch company, Unilever historically had two
boards of directors and rotated the CEO position between leaders of
British and Dutch descent. This split, which led to internal struggles
over the years, was resolved when Polman became CEO.
Shortly after Polman joined the company, a director told him,
“You’re a very nice guy, but you don’t belong here because we always
promote people internally.” That comment energized him to study
the company’s history and to build on the legacy of Lord Lever-
hulme, who used Sunlight soap to help eliminate malaria in Britain.
A unified Unilever board was established, with the company based
in London. During Polman’s tenure, Unilever’s board has been
diversified to include a Swedish chairman and directors from China,
the United States, India, and South Africa.
In 2011, he startled the City of London, where most of Uni-
lever’s shares are traded, when he said, “My job is not to serve
shareholders, but to serve Unilever’s customers and consumers.” In
addition, he suspended guidance and reporting on quarterly earnings
so that Unilever’s executives could concentrate on its long-term
strategy and transformation into the leading global consumer prod-
ucts company.
Polman understood Unilever’s potential to help people through-
out the world and build its mission around sustainability. He created
the Unilever Sustainable Living Plan as the basis for Unilever’s
strategy. As Polman and his top 50 executives addressed these issues
at a program we created for them, we concluded, “Sustainability Is
Unilever’s True North.”
To transform Unilever’s culture, Polman created the Compass,
his internal set of mission, values, and strategy statements that
emphasize growth and winning in the market. He simplified the
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company’s product-geographic structure, reducing contact points
from 200 to just 32, and created several global functions. “It is very
clear that the organizational model of a global company by 2020 is
going to be very different than the traditional Western model. The
culture that comes with it must be entirely different,” he noted.
At the outset he worried that Unilever’s leadership team was too
Eurocentric, because most executives came from the United
Kingdom or the Netherlands. In his initial years, he changed 70
of Unilever’s top 100 executives—half internally promoted and half
recruited externally. He explained:
We had to look for people with a growth mind-set who were externally focused
and had passion for consumers and customers. I asked our leaders 10 questions
focused on customers to see how much time they were spending with them.
Their responses were embarrassing.
Yet he was impressed that the company already derived
41 percent of its revenues from emerging markets. He established
the goal of generating 70 percent of revenues from emerging
markets, a dramatic change in the company’s geographic footprint.
Six years into Polman’s tenure, Unilever has 60 percent of its
revenues from these markets.
We want to create competitive advantage through the diversity of our people.
Because the company’s center of gravity is shifting to the East, we put our
chief operating officer, a major business unit, and Four Acres Singapore, our
new €44 million leadership development center, in Singapore. Today, we have
more people there than in London.
Unilever must have geographically distributed leaders, because I don’t
think the concept of head offices will be relevant in the future. You don’t want
product categories in a London-based, Anglo-Saxon model anymore, but rather
dispersed globally. In addition, we put two big research centers in Bangalore
and in China, and brought all of our engineering centers to India.
Unilever is working hard to develop more leaders from emerg-
ing markets. Polman said, “We are blessed to have many senior
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leaders from emerging markets compared to other companies, but
we are still well underrepresented.” COO Harish Manwani pro-
posed, “If 70 percent of our business will be in emerging markets,
ultimately 70 percent of our leaders must come from these mar-
kets.” Added Polman: “We have to create new leadership cultures
for the future, but do so with leaders who are running the business
now.”
We need leaders who are more sensitive to the cultures of emerging markets,
with higher levels of transparency, cooperation, and comfort with volatility.
You have to expose your leadership team to crucible moments that make the
lights go on for what their leadership must be.
Under Polman’s leadership, Unilever has embarked on a vision-
ary program for developing its global leaders—the Unilever Leader-
ship Development Program (ULDP). Polman said, “ULDP prepares
our future leaders for an increasingly volatile and uncertain world
where the only true differentiation between companies is the quality
of leadership.”
Through the ULDP, Unilever has trained its top 600 global
executives in authentic leadership. Participants build their EQ,
discover their leadership purpose, and determine how they can
integrate their purpose into Unilever’s mission and strategy. As
South African Gail Klintworth, Unilever’s head of sustainability,
explained:
My participation in ULDP was transformational. It helped me understand that
sustainability and improving people’s lives are my driving strengths. I wanted a
role that merged sustainability and business to prove that sustainable business is
the only viable model. My new role is the perfect fit, but I wouldn’t have been
brave enough to take it had it not been for ULDP.
One of Polman’s executive moves was to promote Leena Nair to
global head of human resources. Nair, a career employee of Hindu-
stan Unilever, was formerly head of human resources for South Asia
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and led global diversity. However, the move to London was a
challenging one for her, as she noted:
This was the moment I had always dreaded, as I had said I wasn’t mobile
because my husband runs a successful company in India. But Paul convinced
me I needed to build networks and relationships with senior leaders and the
board. Today, my two sons and I live in London and my husband splits his time.
Nair added:
Unilever’s leadership profile needs to reflect the world of 2020. We need more
women in our leadership ranks, and a greater global footprint in our leaders. To
transform the organization to compete for the future, we need people with a
global mind-set and the ability to understand our complex global organization
who can leverage its strengths.
Challenges of the Global Context
Over the long term, organizations run by leaders who are effective in
operating globally will be more competitive, more productive, and
more profitable. Taking advantage of the emerging markets in
today’s world of rapid-fire communication and global supply chains
requires leaders who understand the rapidly changing global context
in which they are operating.
Understanding Geopolitical Context
Today’s world is far more uncertain than it was in the past, largely
because of the rise of emerging markets with greater instability, speed
of information technology, and interdependency of nations. To
adapt to this rapidly changing world, companies need a clear
understanding of the geopolitical context of their business and
have a keen awareness of how geopolitical events can affect it.
Will political unrest in Egypt delay a supplier? Will conflict in
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Ukraine affect natural gas prices? Could a data center problem in
India undermine your research center in Shanghai?
If your organization has a distributed global workforce with
crossfunctional teams working across time zones, you can gain
competitive advantage by accessing world-class talent, increasing
productivity, and benefitting from comparative advantage in your
organizational structure.When I was at Medtronic, software teams in
Minneapolis uploaded their code each evening for continued devel-
opment by their counterparts in India, which reduced product
development cycles by 40 percent, cut costs, and increased quality.
However, this global value chain also increased risk exposure to
potential project delays and unexpected quality issues. What is the
impact of a wild currency swing, a regional military conflict, or the
passage of new adverse legal regulations? Navigating these challenges
is not simple.
Reinventing Business Models
In mature markets, industry structures are often well defined. For
example, the relationship between medical device makers and
health care providers in the United States is a straightforward
vendor-customer relationship in which doctors select devices for
patients and maintain responsibility for the entire patient experi-
ence. In contrast, emerging markets offer the opportunity to create
new business models and test them out.
When Omar Ishrak became CEO of Medtronic in 2011, he saw
many opportunities for increased growth in emerging markets. Born
in West Bengal (now Bangladesh) and educated in London, Ishrak
exemplifies the new global leader. He worked for Dutch conglom-
erate Philips for eight years, eventually moving to ultrasound leader
Diasonics and then to General Electric. “Since Philips was a Dutch
company,” he explained, “you couldn’t advance unless you were
Dutch. At an American company I felt I could have greater impact.”
First, he broadened the company’s predominantly American
leadership team, adding six non-Americans to the company’s
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executive committee. This immediately changed decision mak-
ing at the top and placed increased emphasis on emerging
markets. Next, his leadership team reenvisioned the medical
technology ecosystem by introducing revolutionary new busi-
ness models.
Ishrak explained, “What I learned at Medtronic caused me to
think differently about globalization.”
Conventional wisdom is to make low-cost products in local product centers, cut
prices, and you will globalize. Instead, I found our products were not being used
by people who could afford them. So my priority shifted to education, training,
patient and physician awareness, and building infrastructure.
This insight led to the creation of Medtronic University in
Beijing to train physicians, as well as the establishment of patient
centers throughout China to educate patients about their diseases. In
India, diagnostic camps were created and guaranteed bank loans
made to patients to finance their medical care. Even in Europe,
Medtronic created new business models, such as building and
operating catheterization labs that use Medtronic products.
Flipping the Headquarters Paradigm
Most multinational organizations deploy matrix structures that
attempt to balance strategic business units with geographic organi-
zations. In the past, multinationals sent talented expatriates from
their home countries to lead regional and local units and to transfer
headquarters standards, processes, control systems, and marketing
approaches to local countries. It was the rare foreign national who
made it to the decision-making table of these multinational organi-
zations, much less ascended to the top of the corporation. For
example, the bank HSBC had a long-standing practice of hiring
200 expatriates from the United Kingdom and sending them over-
seas to manage its local banks, mostly in Asia, in accordance with
policies set in London.
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During my years as president of Honeywell Europe in the 1980s,
the corporation sent many American expatriates to regional and
country operations to transfer U.S.-based marketing programs as
well as engineering and manufacturing expertise. Too often U.S.
colleagues seemed insensitive to the significant differences of the
markets of Europe, the Middle East, and Africa and were intent on
imposing U.S. practices on them. So I asked INSEAD professor
Andre Laurent to create a leadership program for my American
colleagues on cultural differences and how to bridge them. He
proposed doing the first two days on American culture and the
next two days on European cultures, saying, “Americans rarely
understand their own cultural biases, and just assume their ways
are superior if only others understood.”
Companies are finding that imposing norms and marketing
programs from headquarters does not work in emerging markets. In
trying to sell food products globally, many consumer companies
have learned the hard way that their products did not fit the tastes
of local consumers. Thus, they were unable to compete head-to-
head with skilled local companies in countries such as Japan,
Korea, India, Brazil, and Russia that had a deeper understanding
of local consumers’ needs.
Building Diverse Leadership Teams
To maximize growth in emerging markets, companies are recogniz-
ing they require much greater diversity in their decision-making
ranks. As Siemens CEO Peter Loescher said in 2008, “Siemens is not
achieving its full potential on the international stage, because its
management is too white, too German and too male. We are too
one-dimensional.” Arguing greater diversity was essential for Sie-
mans’s future, Loescher observed, “If your leadership does not reflect
your global client base, you cannot achieve your full potential.”
Consequently, companies are opening up their executive ranks
to the best leaders from around the world, without regard to national
origin. Coca-Cola, a longtime pioneer of this practice, paved the way
by appointing five CEOs from outside the United States. Separately,
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Daniel Vasella, the visionary who built Novartis from a Swiss-
dominated company into a global one, initiated the move of
Novartis’s research headquarters from Basel, Switzerland, to
Cambridge, Massachusetts, to tap into the top scientists at the
Massachusetts Institute of Technology (MIT) and Harvard. Vasella
also foresaw the need to move from a Swiss-dominated management
team and board of directors to a global leadership team, without
regard to nationality.
Despite their efforts, even progressive companies, such as Novar-
tis, still struggle to develop top global leaders from emerging markets.
CEO Joe Jimenez noted how difficult this process is: “You look
around our executive committee and there’s not one person from
Brazil, China, or Russia. It’s not because we don’t look for them; it’s
because we haven’t been able to develop them.”
Developing Global Intelligence (GQ)
Succeeding in the new global context will require companies to
cultivate a cadre of executives—as many as 500 per company—who
have the capabilities of global leaders. Developing these new leaders
requires unique leadership experiences, ideally in emerging markets,
combined with leadership development programs that differ materi-
ally from today’s corporate training programs. Traditionally, the
latter have focused onmanagerial skills and building one’s functional
knowledge. Yet the shortcomings of leaders—and their subsequent
failures—usually result from the lack of leadership capabilities that
we call global intelligence, or GQ.
GQ consists of seven elements, all of which are essential for
global leaders:
• Adaptability
• Awareness
• Curiosity
• Empathy
• Alignment
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• Collaboration
• Integration
Several of these characteristics—such as awareness—seem very
similar to parts of the process we’ve examined for discovering your
True North. That’s by design. Global interactions heighten the stress
that leaders face. The more global the context, the more demanding
leadership becomes. When leaders are placed in emerging market
situations, the complexity increases exponentially because the dif-
ferences in language, culture, customer preferences, negotiating
tactics, business practices, laws, and ethical standards are so great.
The same applies to the activities of daily living in these countries.
That’s why many otherwise solid leaders struggle with global assign-
ments and working in emerging markets.
Let’s examine each of these characteristics of global leaders.
Adaptability
Being a global leader requires the ability to understand today’s
volatile world and foresee changes coming in the years ahead.
Global leaders must be able to adapt quickly to the rapidly changing
global context by shifting resources to opportunity areas and devel-
oping contingency plans to cope with adverse geopolitical situations.
This is particularly true in emerging markets, where frequent changes
in government, currency movements, financial crises, ethnic con-
flicts, wars, and terrorism may literally change the business climate
overnight. In recent years, we have seen this happen in Greece,
Egypt, Iraq, Pakistan, Ukraine, Russia, and India, to mention just a
few. Global leaders must be prepared to alter their tactics quickly to
adjust to changes.
Awareness
Leaders need to understand the world around them, as well as
themselves—their strengths, vulnerabilities, and biases—to perceive
how they will react to the significant cultural differences they
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encounter. When people from developed countries live in emerg-
ing markets, they become much more aware of themselves and
their insecurities as they begin to understand the complexities of
other languages, being in the minority, and differences in cultures
and norms.
Curiosity
Global leaders must have deep curiosity about the cultures they
encounter. This includes a personal passion for diverse experiences
and an insatiable desire to learn from other cultures. They also must
be humble to recognize that different cultural norms and ways of
doing things guiding other cultures may often be superior to their
own.When you visit an emerging market, such as China or India, do
you stay in a deluxe hotel and eat in Western restaurants, or do you
get out into the country, meet the people, go to local markets and
shops, and visit people’s homes to see how they live? That marks the
difference between domestic leaders traveling overseas and global
leaders who are open to experiencing all the world has to offer.
Empathy
Empathy is the ability to walk in someone else’s shoes. This requires
humility and the capability to engage people from different cultures
personally, rather than standing back and judging them. Empathy
builds rapport and bonding and creates lasting relationships. Only
with empathy are leaders able to draw the highest level of engage-
ment from colleagues from different cultures and empower them to
achieve exceptional performance.
Alignment
The challenge for global leaders is to align all employees around the
company’s mission and its values, a commitment that transcends
national and cultural differences. Achieving alignment is far more
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difficult in a global context because the business practices and ethics
in emerging markets often differ so dramatically from those of
developed countries. Thus, global leaders are asking local employees
to put the company’s mission and values ahead of the business
practices and values in countries where they have grown up and
worked. It is no longer sufficient just to comply with the laws and
ethics without regard for negative consequences their business
practices may have on the countries in which they operate. How-
ever, this does not mean giving up their culture and the norms by
which they live, because norms can vary widely from country to
country.
Collaboration
In a global context, collaboration is the ability to create horizontal
networks that cut across geographic lines, bring people together
around common goals, and create a modus operandi that transcends
geographic norms. In authentic global collaborations, participants
put company and project goals first and work together in partner-
ships to achieve them. The most successful geographic collabora-
tions are led by global leaders who know the strengths and
weaknesses of each regional group and whomake assignments within
the team to take advantage of their relative strengths.
Integration
One of the greatest challenges global leaders face is incorporating
local and global issues into an integrated corporate strategy. Such a
strategy enables them to optimize their position in a wide array of
local markets efficiently to create sustainable competitive advantage.
Doing so requires deep understanding of local markets and the global
vision to see how their companies can serve their customers’ needs in
a superior manner by leveraging their corporate strengths. That’s the
only way they can outcompete local companies, which often have a
cost advantage because they operate in the region.
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As Unilever’s Manwani explained, “We have a globally distrib-
uted organizational model that balances local relevance with global
leverage.”
We don’t believe in “Think local; act global.” Instead, we believe in “Act local;
think global.” The company starts by acting locally, creating relevance through
an understanding of consumer needs and desires and their local cultures. Then
we leverage Unilever’s vast global resources to deliver superior products to meet
those needs. This is how we gain competitive advantage over local producers.
We are committed to bringing our expertise to local markets.
Increasing Your GQ
One of the best ways for aspiring leaders to increase their GQ is to
live in an emerging country. The earlier in life you do so—when you
are most open to learning about new cultures and taking risks—the
greater your ability to understand emerging markets. If you are
unable to move overseas, then at least visit developing countries
and spend time in the countryside, where the culture can be more
authentic and less international than in the metropolitan areas.
Novartis’s Jimenez believes that physically living in different
countries is critically important for the globalization of leaders. He
explained:
When we take leaders out of their U.S. comfort zone and put them in a country
like China or India, where they have to figure out how to buy groceries, go to the
doctor, and exist in another country, we see powerful transformations in their
self-awareness, empathy, and respect for other cultures. As a result, they figure
out how to grow their business using different business models than the ones they
are used to.
Operating in emerging markets where everything is different—
the language, customs, culture, laws, and preferences—forces leaders
to challenge assumptions about themselves. Global leaders must
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examine why they react in certain ways when confronted with
extreme differences. If they are open to these entirely new experi-
ences and approach them with a deep desire to learn, they will gain
much higher levels of awareness.
Leading crosscultural task teams can also provide deeper under-
standing of cultural differences. It is also important to learn an area’s
languages to communicate more effectively with local people. Often
the unique aspects of a culture are revealed through language, nuances
that can be missed when locals have to shift to your language.
Interpersonally, global leaders must possess GQ to empower
people throughout the world. If they lack GQ, their view of their
colleagues and customers in emerging markets becomes more rigid
and judgmental, and their learning is constrained. Instead of increas-
ing their empathy for people’s differences, discomfort may cause
them to withdraw from intimate engagement.
When working with teams from many cultures, leaders without
GQ skills try to force people into their company’s dominant culture
rather than create a collaborative environment that draws out the
best of each of their teammates. Rather than enhancing learning,
creativity and innovation, they stifle it. That’s why it is so important
to develop your GQ as a global leader early in your life while your
mind is most receptive to new experiences.
Emerging Global Leaders
In many ways, the new generation of leaders is setting the standards
for leading globally. To understand how they develop their GQ, let’s
look at some examples of younger leaders who have already devel-
oped as global leaders.
David Thai, the Serial Entrepreneur
David Thai was born in Vietnam in 1972. As the war wound down
and Communists took over the country, his family was forced to flee
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to Vanuatu, a small island in the South Pacific. In his early years,
Thai moved a dozen times before his family eventually settled in
Redmond, Washington. Thai’s entrepreneurial instincts showed up
early. When he was only 12, he sold candy door-to-door, but soon
realized more lucrative opportunities by selling to businesses. His
success empowered him to create several more businesses in high
school and at the University of Washington.
Wanting to explore his roots, yet with little comprehension of
the language, he traveled to Vietnam against his parents’ wishes.
“Toward the end of my university education,” he explained, “I felt a
burning desire to discover myself. Returning to Vietnam not only
helped me to understand who I am, but also ignited my desire to
build a lasting legacy for the next generation in Vietnam and
Southeast Asia.”
Inspired by the success of Starbucks in his hometown, he created
his first full-time business at age 25: the Highlands Coffee Company,
which sold packaged local coffee through retailers. Its founding
marked the first time a Vietnamese person living overseas was able to
register a private company within Vietnam. With the success of his
brand, he created a retail chain of Highlands Coffee stores around
Ho Chi Minh City and Hanoi, all sourced from local coffee growers.
Today, Vietnam ranks second only to Brazil in coffee production.
Thai’s success led to his creation of Viet Thai International, a
holding company for several additional businesses, including Pho
24 Vietnamese noodles.
For his accomplishments, Thai was named a Young Global
Leader of the World Economic Forum in 2009. Despite all his
success, he remains remarkably humble—a serial entrepreneur com-
mitted to free enterprise within the auspices of Vietnam’s Commu-
nist government.
Tamara Rogers, the Traveler
Unilever’s Tamara Rogers was born in Zambia after her parents left
England when they were 21 and 18. She said, “I’ve been traveling
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since the day I was born. By the age of 10, I had been to most African
countries, Thailand, Singapore, the U.S., and many countries in
Europe. I became comfortable with different languages, cultures,
faces, colors, creeds, and I loved it.” Rogers went to the United
Kingdom for her high school education but took a year off to explore
countries in Latin America, living from a backpack on three dollars
per day.
Following a serious automobile accident that left her pelvis
broken in five places, she returned to school with the desire to live
every day to the fullest. After graduating from college, she took
time to travel throughout Asia before joining Unilever. Within the
company, her strength lies in bringing together leaders from diverse
backgrounds, helping bring out the best in each of them, and
getting them to collaborate to produce creative solutions.
Rogers’s skills in leading people have made her a very effective
senior vice president at Unilever, where she has been promoted
several times in recent years. She explained, “In Asia, I learned to
turn up the volume on listening and down on talking.”
While Americans and Germans give clear and direct messages, in Asia you can
miss what people are trying to tell you, so you have to turn up the amplifier to
pick up the signals. I love that diversity. On my leadership team, we encourage
everyone to express their point of view to be sure everyone is being heard. We
develop people by encouraging them to move out of their comfort zones, as this is
where they learn the most, yet give them a safety net.
Peilung Li, the Rebel
Peilung Li, who at only 39 is chair of SoftBank Investment China,
faced many challenges in his early years. He learned he could thrive
only by going his own way. Born in Taiwan, Li suffered loneliness at
the age of five when his parents divorced. Life got even tougher
when his mother married a strict disciplinarian he was afraid of.
Because he saw the world so differently from his instructors, Li was
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bored in school and became known as a rebel and troublemaker. So
he turned inward and used art to express his ideas.
When he was 15, he moved to California to live with his uncle,
where he was forced to become independent. Speaking little English,
he spent most of his time drawing. When his mother immigrated to
the United States to start a restaurant, they moved to a lower-class
neighborhood. There he had to confront robberies in her restaurant,
and later he was assaulted at gunpoint in his school bathroom. “I was
terrified that the robbers would attack me again because they saw me
in court when I testified,” he explained. “In order to protect myself,
I decided to dress in disguise.”
After graduating from the University of California, Santa Bar-
bara, he won a scholarship to study in Japan, where once again he did
not speak the language. Nevertheless, he excelled in his Japanese
school and stayed in Japan to work in consulting. More than once,
he had to challenge his superiors’ ethics. Joining Daiwa Securities in
Tokyo, he was sent to China to create a four-way joint venture,
where he frequently got in disputes with the partners over misuse
of funds.
After a brief stint in the United States, Li joined SoftBank
Investments (SBI), first in Tokyo and then in Beijing, using his
language fluency and cultural understanding to build SoftBank’s
business in China. He frequently found himself in opposition to the
ethics of the Chinese joint venture partner, and had to resist being
blackmailed. Winning the trust of SBI’s chair, Li set up a series of
joint ventures out of his Shanghai office and was rewarded with the
promotion to chair of SBI China.
What has enabled Li to be so successful before turning 40? Quite
likely, his early experiences forced him to be his own person and to
venture into new situations where he knew no one and did not
understand the language. These experiences helped develop his char-
acter, his values, and the courage to take on challenging situations,
while confronting dishonesty. This independence of thought and
spirit characterizes not only Li but also the new generation of
emerging global leaders.
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Rodrigo Mascarenhas, the Multiplier
Rodrigo Mascarenhas grew up in Brazil—a shy boy who dreamed of
becoming an astrophysicist. When he gave a speech in his Dale
Carnegie course, he said, “Something inside of me clicked, and I
changed completely. I learned by telling my story that I could
connect to people’s hearts and to their experiences. My self-confi-
dence exploded.”
Unfulfilled by working in his father’s tire business, Mascarenhas
went through the Hoffman Process of self-discovery, where he
learned how to align his emotional self with his intellectual self,
his body, and his spirit. That gave him the courage to break away
from his father’s business and get his MBA degree from Case
Western. Work experiences led him from Brazil to Spain, the
Czech Republic, and eventually London.
What has distinguished him in each situation is his ability to be a
multiplier for people’s abilities. He explained, “I have the gift of
creating a bridge of trust with people.”
I connected with something deeper inside them and helped them see their
potential and blossom. They did the same with people around them, and it
became a multiplying effect. Every time, they blossomed and became strong
leaders, full of self-confidence. It impacted their lives, their children, their view
of life, and even their physical condition . . .
I was sitting on the greatest gift anyone can have—a treasure box—
without understanding who I was. I had the keys to the box, but instead I was
looking outside myself, when the gift was already within me.
Because we live in a complex world where there are so many choices, it is
easy to sell your soul for fame, money, and status. But my purpose is to impact
people’s lives in positive ways. Throughout my career I have been catapulted
because I am a multiplier. It’s this gift I have to reach out to people and connect
with them at a deeper level, regardless of their nationality. Life doesn’t get much
better than that. I feel a powerful spiritual calling, because I am part of
something larger than myself.
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Abby Falik, Developing Global Leaders
At 27, Abby Falik founded the nonprofit Global Citizen Year to
create a gap year for high school graduates who want to live and serve
in an emerging market before going to college. A polished and
accomplished woman, Falik got her exposure to emerging markets at
a young age. At 13, her parents took her to Indonesia, where she
encountered extreme poverty. Emotions of confusion and guilt
overwhelmed her. “In the words of one of my mentors, once the
social justice nerve gets exposed,” she said, “you cannot ignore it.”
Her interactions with young people left her deeply unsettled. “I was
born in a time and place where I’ve been told I can be whatever I
want. Talking to young people who were growing up in a dramati-
cally different context, I realized they had none of the opportunities I
had, just because of where they were born.”
Global experiences continued to shape Falik. In high school, she
spent a summer teaching in Nicaragua while living with a family.
“That experience solidified my desire to use my leadership in a global
context,” she said, “but I also learned that leadership was about
humility, listening, and patience.” She left Nicaragua committed to
developing herself to address these issues. During college, Falik took
a year off from school and returned to the Nicaraguan community,
determined to build a library. “The books I had brought when I was
16 were still being passed around the community because there were
so few books. There was a long waiting list just to devour the books
I brought five years before.”
Falik’s idealism hit obstacles. “This experience was the hardest
and most humbling of my life. I had arrived with some resources, yet
had no idea how to make things work.” Community fissures slowed
the library project. She explained, “I had no business being a
forewoman on a construction project in a foreign language and
culture,” she said. “At the end of each day, I was deflated that more
progress wasn’t being made, but I also learned that failure can be
constructive.”
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Before founding Global Citizen Year, Falik sought advice from
Teach For America’s Wendy Kopp. She dreamed of growth like that
organization’s rocketlike trajectory, but the market for donors and
fellows for a gap-year program wasn’t as large. Although the pace was
slower than anticipated, she stayed focused on her purpose. As one of
her board members observed, “I have never seen anyone as
unwavering in commitment to her mission. She just kept pushing
to sign up donors and students, believing we had to change the way
we prepare young people for global leadership.”
Falik’s experiences living in emerging markets shaped the pro-
gram she designed for Global Citizen Year. Her goal is for every high
school graduate to consider a bridge year before going to college. In
2015, Falik sent 100 graduates on yearlong service fellowships in
Brazil, Senegal, and Ecuador. She observed:
Early on, fellows face loneliness in living with their host families and under-
taking service assignments in unfamiliar languages, which forces them to look
inside themselves. My experiences in my gap year broke me down. When
everything is new and uncomfortable, you see yourself through a fresh lens.
Today, the cohort of Global Fellows has grown tenfold. Increas-
ingly, the organization is shaping a broader conversation on the role
of service and global experience in higher education. Behind the
scenes, Falik is advising government leaders and university presi-
dents on how to give tomorrow’s leaders global exposure. “It’s an
even bigger opportunity than I thought it could be,” Falik said.
“Within 10 years, I hope Global Citizen Year will influence all young
people to live and serve abroad, become mindful, and grow into
authentic global leaders.”
The Future for Global Leaders
From Paul Polman to Peilung Li to Abby Falik, the new generation
of authentic global leaders is changing the way business is done
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around the world. This new generation is much broader and worldly
than my generation. These leaders recognize that in the future,
businesses can thrive only by serving all the people of the world
equitably while also contributing to their societies.
Exercise: Developing GQ
1. Have you immersed yourself in an unfamiliar environment and if
so, what feelings did you experience—vulnerability, loneliness,
uncertainty?
2. How will globalization change your organization’s mix of cus-
tomers and products? How will you need to grow and adapt to
lead in the future state of the organization?
3. How high is your GQ? What concrete actions can you take to
raise it?
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Afterword
Stakeholders in Society
I don’t spend 15 minutes thinking about making money.
What is important in my life is influencing many people as
well as China’s development.
—Jack Ma, CEO, Alibaba
We conclude Discover Your True North by addressing the chal-
lenging, often controversial topic of the role of business in our
twenty-first-century global society. We are at risk of losing sight of
the purpose of business. It is not only to reward shareholders in the
near term but also to build sustainable entities that create value for
all their constituencies.
Jack Ma: China’s First Global Leader
Alibaba’s JackMa has emerged as China’s first truly global leader, the
face of the newChina: a free-enterprise entrepreneur working within
the confines of a Communist government to build a more equitable
society.
Ma was on fire as we talked over lunch the day that Alibaba
launched the largest initial public offering (IPO) in history. Its
stock price makes Alibaba the eighteenth-largest global com-
pany by market capitalization. Ma’s goal isn’t making money.
Because of Alibaba’s success, he is already China’s wealthiest
citizen, with a $20 billion net worth. Yet when he asked his wife
whether it was more important to be wealthy or have respect,
they agreed upon respect.
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In person, Ma is warm, affable, open, and authentic. For all his
success, he is extremely humble, preferring to talk about building a
great company that helps customers, creates jobs, and serves society.
“I’m just a purist. I don’t spend 15 minutes thinking about making
money,” he said. “What is important in my life is influencing many
people as well as China’s development. When I am by myself, I am
relaxed and happy.” He added, “They call me ‘Crazy Jack.’ I hope to
stay crazy for the next 30 years.”
China’s large and growing economy has made it an increasing
economic force the past two decades, but it has not produced global
companies. Instead, Chinese businesses have focused domestically
and engaged in low-cost production for international companies. Ma
has a very different approach. He sees the Internet as a worldwide
phenomenon that knows no borders. Today, the Alibaba companies
serve 600 million customers in 240 countries. Ma intends to expand
aggressively in the American, European, and emerging markets by
linking 1 million small businesses with 2 billion Asian consumers.
He also has plans to disrupt China’s commercial banking and
insurance sectors.
In the times I have been with him, Ma relishes telling his life
story. Raised in humble origins in Hangzhou in the 1980s, he
overcame one obstacle after another. He was rejected at virtually
every school he applied to, even grade schools, because he didn’t test
well in math.
Yet he persevered. From ages 12 to 20, he rode his bicycle
40 minutes to a hotel where he could practice his English. “China
was opening up, and a lot of foreign tourists went there,” he said.
“I showed them around as a free guide. Those eight years changed me
deeply, as I became more globalized than most Chinese. What
foreign visitors told us was different from what I learned from my
teachers and books.”
As a young man, Ma applied for jobs at 30 companies and was
rejected at every one. He seemed most stung by his experience at
Kentucky Fried Chicken where 24 people applied and 23 got jobs.
Ma was the only applicant rejected. Consequently, he became an
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English teacher at Hangzhou Electronics Technology College.
When he visited America for the first time in 1999, he was stunned
by the entrepreneurial culture he saw in California. “I got my dream
from America,” he said. “In the evenings in Silicon Valley, the roads
were full of cars, and all the buildings had lights on. That’s the vision
of what I wanted to create [at home in China].”
Returning to Hangzhou, he and Joe Tsai (now executive vice
chair) founded Alibaba in Ma’s modest apartment. “We chose the
name,” he explained, “because people everywhere associate it with
‘Open, Sesame,’ the command Ali Baba used to open doors to
hidden treasures in One Thousand and One Nights.” Ma focused on
applying his team’s ideas to help businesses and consumers find their
own hidden treasures. Yet he was unsuccessful in raising even
$2 million from American venture capitalists, but, once again, he
persevered. Eventually, he raised $5 million through Goldman
Sachs, and later, Masayoshi Son of Japan’s SoftBank invested
$20 million.
Ma is passionate about building the Alibaba ecosystem in order
to help people, a philosophy that he is trying to embed into the DNA
of the company. At the company’s founding, he issued generous
stock option packages to early employees because he wanted to
enrich their lives. The day of the IPO, he insisted Alibaba’s six
values—Customer First, Teamwork, Embrace Change, Integrity,
Passion, Commitment—be placed on the pillars of the New York
Stock Exchange.
Ma’s commitment to a cause larger than himself has propelled
him forward.
My vision is to build an e-commerce ecosystem that allows consumers and
businesses to do all aspects of business online. I want to create one million jobs,
change China’s social and economic environment, and make it the largest
Internet market in the world.
American tech leaders, such as Larry Page of Google and Mark
Zuckerberg of Facebook, have emphasized technology and product
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above everything. NotMa. “I’m not a tech guy,” he said. “I’m looking
at technology with the eyes of my customers—normal people’s eyes.”
With his light-hearted nature, Ma participates in annual talent
shows where he sings pop songs. He also practices Tai Chi and
martial arts, which he calls “the most down-to-earth way of explain-
ing Confucianism, Buddhism, and Taoism. These practices cherish
brotherhood, morality, courage, emotion, and conscience.”
Ma worries that China lost an entire generation when Mao
Zedong phased out Confucianism and other forms of spirituality. His
bold vision is to restore that sense of values and purpose to the next
generation. “It’s not policies we need, but genuine people,” he said.
Ma is highly ethical in his business practices. He noted, “I would
rather shut down my company than pay a bribe.”
For all his confidence, Ma is not without worries. He believes his
biggest challenges are to create genuine value for his customers, to
work cooperatively with the government, and to build his team of
global leaders. He would like to use his wealth to found a university
for entrepreneurs that can produce the next generation of Chinese
entrepreneurs. “Our challenge,” Ma said, “is to help more people to
make money in a sustainable manner. That is not only good for them
but also good for society.”
The Purpose of Business
In recent years, short-term traders, including hedge funds, have steadily
gained power. These active investors, compensated with high fees and
earning 20 percent of the realized profits, have had an insidious effect
on capitalism. Focused on driving short-term gains rather than
investing in companies for long-term returns, they have created a
frenzy tomaximize short-term shareholder value. By forcing companies
to cut research and other long-term investments, their pressure can
destroy the economic value and the future viability of firms.
Nevertheless, the debate continues to rage about whether busi-
nesses are chartered to maximize value to their shareholders and
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owners, or whether they have broader obligations to all their
stakeholders. In November 2014, as a guest lecturer for third-year
students at the Harvard Law School, I posed the question: “Is the
corporation an institution to be developed to serve society, or a
collection of assets organized to maximize returns to investors?” I was
both surprised and disappointed when all 30 students said it was the
latter, to maximize returns to investors. They were so strong in their
views that we had difficulty getting a good debate going on the topic.
In fact, the legal structure of publicly held corporations in most
countries—a limited liability corporation—is chartered by society to
serve society. Yet, the fierce pressures from shareholder groups over
the past 30 years have convinced most investors and many business-
people that their role is solely to manage assets to maximize near-
term shareholder returns.
Sadly, many investors and companies take the legal freedom to
operate as a given, not realizing the extreme remedies society can
exact on companies when they misbehave. Therein lies the risk to
capitalism. As we have seen since the fall of Enron in 2003 and the
virtual collapse of the global financial system in 2008, unbounded
capitalism is at risk of self-destructing. That’s why the United States
passed laws such as Sarbanes-Oxley in 2003 and Dodd-Frank in 2011
to restrain free markets. But laws alone are not the answer. What is
required is that corporate and government leaders work together to
restore capitalism to its original purpose of serving society through its
mission to serve all its stakeholders.
Infosys founder Narayana Murthy believes the purpose of busi-
ness must go beyond maximizing shareholder value. He said, “You
cannot sustain long-term shareholder value unless you create sus-
tainable value for your customers, while assuring fairness to all
stakeholders: customers, employees, investors, vendor partners, gov-
ernments, and society.”
The best index of success is longevity. If you have existed for a long time, that
means you have gone through thick and thin, learned to strengthen your character,
focused on clients, and tightened your belt. That is what makes you stronger.
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Murthy emerged from his experience in Paris in his twenties with
four guiding principles that he calls “compassionate capitalism.”
First, the only way to remove poverty is to create new jobs and more
wealth. Second, only a few people can lead the creation of these
enterprises and create jobs and wealth. Third, these people need
incentives to create wealth fairly. Finally, it is not the responsibility
of the government to create jobs or wealth; the government’s task is
to create an environment where a fair incentive system encourages
people to create more jobs and more wealth. He explained, “People
need opportunities, incentives, and competition in order to better
themselves. This is the essence of capitalism. If you combine the
spirit of capitalism with fairness, decency, transparency, and honesty,
the result is compassionate capitalism.”
Whole Foods founder John Mackey addressed these issues
directly in his 2013 book, Conscious Capitalism.
Our vision for Conscious Capitalism is to inspire the creation of more conscious
businesses that are galvanized and aligned by higher purposes that serve the
interests of all their stakeholders; with conscious leaders who exist in service to
the company’s purpose, the people it touches and the planet . . . Together,
business leaders can liberate the extraordinary power of business and capitalism
to create . . . a world of compassion, freedom, and prosperity.
In my experience many proponents of maximizing shareholder
value do not understand how companies create sustainable share-
holder value—or they don’t care because they are simply traders of
stocks, not long-term investors in companies. Creating sustainable
value must start with the alignment of all stakeholders around a
shared mission and values in service to a corporation’s customers and
all those who have a stake in its success.
The mission provides the inspiration for employees to innovate
and to give superior service to customers—and values are the glue that
binds global companies together. In turn, innovation and superior
service create revenue and profit growth, which creates sustainable
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shareholder value, provided companies continue to make long-term
investments to sustain their success (see Figure A.1). Thus, the
interests of all stakeholders align, which puts the enterprise on a
sustainable course.
Becoming Stakeholders in Society
At this point in history, when public trust in corporations and their
leaders is so low, we need to move beyond the shareholder-versus-
stakeholder debate and reframe it as: How well are global corporations
serving society through their business?
Klaus Schwab, founder and CEO of theWorld Economic Forum,
has long been a leading voice in advocating that corporate leaders
must help address society’s problems. His questions are even more
pertinent now that global society is so closely intertwined. At dinner
with a group that included me at Harvard, Schwab proposed the idea
that instead of looking at society as one of their stakeholders,
companies should consider themselves “stakeholders in society.”
Professor Michael Porter andMark Kramer addressed this issue in
their seminal article in Harvard Business Review (January 2011),
“Creating Shared Value.” They proposed that the role of companies
Figure A.1 Sustaining Growth and Performance
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is to create value for society through their mainstream business, not
just as a sidelight by using their philanthropic foundations.
In commenting on Porter’s article, Unilever’s Paul Polman said,
“My philosophy goes one step further.”
It’s not enough anymore to say you contribute to a better world. You actually
have to be part of the solution, and solve some of the issues to reverse what is
happening. Instead of thinking how you can use society to be successful, you
have to start thinking how you can contribute to society and the environment to
be successful.
“To do these things, you must have a much higher level of
transparency and a longer time frame than the stock markets try to
impose on you,” Polman explained.
Discovering my True North helps me because we are in a territory that nobody
has walked. Frankly, the forces are against you until we have a drastic change
in the way we measure externalities and the financial markets’ success, which
have brought us to the problems we have today.
Polman argued that being part of a socially responsible enterprise
requires an even higher level of performance because the commit-
ment you set to society is so much higher:
We need new business models led by a generation of leaders with the mind-set
and courage to tackle the challenges of the future. Business must become part of
the solution to those challenges. Issues like deforestation and food security
cannot be tackled by just one company acting alone; they require collaboration
within and across industry sectors. In a world of scarcity, there will be great
pressure to ensure that wealth is created not just for the few, but that the benefits
are spread to all.
Polman concluded by saying, “Unilever’s purpose is having a
sustainable business model that is put at the service of the greater
good. It is as simple as that.”
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What if all companies reframed their purpose along these lines?
Think of the impact that global companies and local enterprises—
both for-profit and nonprofit—could have on addressing the world’s
most pressing problems: global health, food and water supplies,
population control, energy and the environment, job creation,
wealth distribution, and global peace.
Leaders can sustain the effectiveness of their organizations only if
they empower employees around a shared purpose. As a leader, you
must convey passion for the business every day while maintaining
clarity about the mission of your organization. That’s what Jack Ma,
Ken Frazier, Indra Nooyi, and so many members of this new
generation of global leaders are doing.
I hope that you, too, will commit to becoming an authentic
leader who will Discover Your True North. The world faces impor-
tant problems. Your leadership, teamed with that of other leaders
who are similarly committed, is needed to build sustainable business,
government, and nonprofit organizations that collectively make this
world a better place to live for all the people who inhabit it.
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New Leaders Featured in
Discover Your True North
Name Title Organization
Abby Falik Founder Global Citizen Year
Alan Mulally CEO Ford Motor
Arianna Huffington Founder Huffington Post
Brad Garlinghouse Founder Hightail
Brian Cornell CEO Target
Chade-Meng Tan Jolly Good Fellow Google
David Thai Founder Viet Thai
International
Donald Graham CEO Washington Post
Company
Ellen Langer Professor of Psychology Harvard University
Erskine Bowles Cochair President’s
Commission on
Fiscal Stability
Gail Klintworth Senior Vice President of
Sustainability
Unilever
Hank Paulson Secretary of Treasury and
former Chair and CEO
Goldman Sachs
Harish Manwani Chief Operating Officer Unilever
Indra Nooyi CEO PepsiCo
Jack Ma Founder Alibaba
Jes Lipson Founder ShareFile
Jim Wallis Founder Sojourners
Joe Jimenez CEO Novartis
John Hope Bryant Founder Operation Hope
John Mackey Founder and Co-CEO Whole Foods Market
(continued)
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(continued)
Name Title Organization
Ken Frazier CEO Merck
Lance Armstrong Cyclist
Leena Nair Vice President of Human
Resources
Unilever
Lord John Browne CEO British Petroleum
Mark Zuckerberg Founder and CEO Facebook
Michael Bloomberg Founder and CEO; former
Mayor
Bloomberg;
New York City
Nelson Mandela President South Africa
Omar Ishrak CEO Medtronic
Paul Polman CEO Unilever
Pedro Algorta Survivor of Uruguayan
rugby team’s crash in
the Andes
Peilung Li Chair SoftBank China
Peter Loescher CEO Siemens
Rajat Gupta Worldwide Managing
Director
McKinsey
Richard Fuld CEO Lehman Brothers
Robert Greenleaf Creator Servant leadership
Rodrigo Mascarenhas Managing Director Bunzl
Sallie Krawcheck Chief Financial Officer Citigroup
Sam Palmisano CEO IBM
Seth Moulton Representative U.S. Congress
Sheryl Sandberg Chief Operating Officer Facebook
Steve Jobs Founder Apple
Tamara Rogers Senior Vice President Unilever
Taylor Carol Student Harvard University
Tim Cook CEO Apple
Tony Hsieh CEO Zappos
Tracy Britt CEO The Pampered Chef
Warren Buffett CEO Berkshire Hathaway
Zach Clayton Founder Three Ships
Note: The titles listed reflect the individuals’ titles at the time of the interview or the story
contained in this book.
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Participants from the Original
Research for True North
Name Title Organization
Addison “Tad” Piper CEO Piper Jaffray
Akshata Murthy Student Stanford Business School
Alan Horn President Warner Bros.
Ann Fudge CEO Young & Rubicam
Ann Moore CEO Time Inc.
Anne Mulcahy CEO Xerox
Bill Campbell Chairman Intuit
Brenda Barnes CEO Sara Lee
Bruce Chizen CEO Adobe Systems
Cesar Conde Vice President Univision
Charles Schwab CEO Charles Schwab
Chris O’Connell Senior Vice President Medtronic
Dave Cox CEO Cowles Media
David Pottruck Co-CEO Charles Schwab
David Gergen Director Center for Public
Leadership, Harvard
Kennedy School
Denise O’Leary Venture capitalist
Dick Kovacevich CEO Wells Fargo
Donna Dubinsky CEO Numenta
Doug Baker Jr. CEO Ecolab
Daniel Vasella CEO Novartis
Reatha Clark King President General Mills
Foundation
Roy Vagelos Former CEO Merck
Gail McGovern Professor Harvard Business School
(continued)
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(continued)
Name Title Organization
Howard Schultz Chairman Starbucks
Ian Chan Founder U.S. Genomics
Jack Brennan CEO Vanguard
Jaime Irick Vice President General Electric
Jean-Pierre Rosso Chairman World Economic Forum
USA
Jeff Immelt CEO General Electric
John Donahoe CEO eBay
Jon Huntsman Sr. Chairman Huntsman
Judy Haberkorn President, Consumer
Sales
Verizon
Judy Vredenburgh CEO Big Brothers Big Sisters
of America
Keith Krach Former CEO Ariba
Kent Thiry CEO DaVita
Kevin Sharer CEO Amgen
Lisa Dawe Regional Operations
Director
DaVita
Marilyn Carlson Nelson CEO Carlson Companies
Martha Goldberg Aronson Vice President Medtronic
Michele Hooper Vice President Baxter
Mike Baker CEO Arthrocare
Mike Sweeney CEO Steinway
Narayana Murthy CEO Infosys
Oprah Winfrey Founder Harpo
Paula Rosput Reynolds CEO Safeco
Per Lofberg CEO Merdo
Philip McCrea Founder Vitesse Learning
Randy Komisar Partner Kleiner Perkins
Caufield & Byers
Sam Palmisano CEO IBM
Steve Rothschild Founder Twin Cities RISE!
Warren Bennis Professor University of Southern
California
Warren Buffett Chairman Berkshire Hathaway
Wendy Kopp Founder Teach For America
Note: The titles listed reflect the individuals’ titles at the time of their interview or the story
contained in this book.
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Where Are They Now?
A. G. Lafley A. G. Lafley is chairman of the board, president,
and CEO of Procter & Gamble. Lafley retired in
2010 and rejoined Procter & Gamble in
May 2013.
Alan Horn Alan Horn has been chairman of The Walt
Disney Studios since June 2012.
Alice Woodwark Alice Woodwark joined Compass Group as
strategic development director in December
2013.
Andrea Jung Andrea Jung is president and CEO of
Grameen America, and a board member of
Apple, General Electric, and Daimler AG.
Ann Fudge Ann Fudge serves on the boards of General
Electric, Novartis, Unilever, and Infosys.
Ann Moore In February 2014, Ann Moore became founder
of The Curator Gallery. She retired as CEO
and chair of Time Inc. in 2011.
Anne Mulcahy Anne Mulcahy is chair of Save the Children
Federation. She retired as chair and CEO of
Xerox in May 2010.
Bill Campbell Bill Campbell is chairman of the board of Intuit.
Bill Gates Bill Gates is founder and board member of
Microsoft Corporation. He served as chairman
of the board until February 2014. He is now
focusing on the Gates Foundation.
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Bob Fisher Bob Fisher is director of The Gap, where he
was previously CEO.
Bowen “Buzz”
McCoy
Bowen “Buzz” McCoy is a real estate and
business counselor with Buzz McCoy
Associates.
Brenda Barnes In 2010, Brenda Barnes resigned from her
position as CEO of Sara Lee.
Bruce Chizen Bruce Chizen is a venture partner at Voyager
Capital, where he’s served since 2009.
Cesar Conde Cesar Conde is executive vice president at
NBCUniversal.
Charles Schwab Charles Schwab is chairman of The Charles
Schwab Corporation.
Chris O’Connell Chris O’Connell is executive vice president
of Medtronic, where he has served since 2009.
Craig Venter Craig Venter is founder and CEO of J. Craig
Venter Institute and founder and CEO of
Synthetic Genomics.
Dan Schulman Dan Schulman is group president, Enterprise
Growth, of American Express.
Dave Cox In 1998, Dave Cox retired as CEO of Cowles
Media.
David Darst David Darst is a venture capitalist at OrbiMed
Advisors.
David Dillon Dave Dillon retired as chair and CEO of
The Kroger Company at the end of 2013.
David Gergen David Gergen is a professor of public service
and codirector of the Center for Public
Leadership at the Harvard Kennedy School,
and is a regular commentator for CNN.
David Pottruck David Pottruck serves as chair of HighTower
Advisors.
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Debra Dunn Debra Dunn is a consulting associate professor
at the Institute of Design at Stanford.
Denise O’Leary Denise O’Leary is a private venture capital
investor. She is a board member of Medtronic,
US Airways, and Calpine Corporation.
Dermot Dunphy Dermot Dunphy is CEO and executive
chairman of Cryovac.
Dick Kovacevich Dick Kovacevich serves as a member of the
Federal Reserve’s Federal Advisory Council. He
was chair and CEO of Wells Fargo until 2009.
Don Carty Don Carty is chairman of Virgin America and
Porter Airlines.
Donna Dubinsky Donna Dubinsky is CEO and cofounder of
Numenta.
Douglas Baker Jr. Douglas Baker Jr. is chairman of the board and
CEO of Ecolab.
Daniel Vasella Dr. Daniel Vasella served as CEO of Novartis
from 1996 to 2010 and as board chair from
1999 to 2013. He is currently a board member
of PepsiCo and American Express.
Reatha Clark
King
Dr. Reatha Clark King is chairman of the
National Association of Corporate directors,
and former board member of Exxon Mobil,
Wells Fargo, Minnesota Mutual, H. B. Fuller
Company, and Lenox Group
Roy Vagelos Dr. Roy Vagelos has served as chair of
Regeneron Pharmaceuticals since 1995.
Durk Jager Durk Jager served as director of Chiquita
Brands International from December 2002 to
November 2010.
Earl Bakken Earl Bakken cofounded Medtronic and served
as chairman and CEO from 1957 to 1976 and
retired from the board in August 1994.
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Ellen Breyer Ellen Breyer is the former CEO of the
Hazelden Foundation.
Ellen Marram Ellen Marram serves on the board of directors
for The New York Times Company, Ford
Motor Company, and Eli Lilly and Company.
Fadi Ghandour Fadi Ghandour is the president and vice
chairman of Aramex International.
Gail McGovern Gail McGovern has served as president and
CEO of the American Red Cross since 2008.
George Shultz George Shultz is a fellow at the Hoover
Institution at Stanford University.
Howard Schultz Howard Schultz is the chairman, president,
and CEO of Starbucks Corporation.
Ian Chan Ian Chan is founder and CEO of Abpro
Corporation.
Jack Brennan Jack Brennan serves on the board of General
Electric and is chairman emeritus and senior
advisor to Vanguard.
Jack Welch Jack Welch is senior advisor to Clayton,
Dubilier & Rice.
Jaime Irick Jaime Irick is general manager for North
America Professional Solutions at General
Electric.
Jean-Pierre Rosso Jean-Pierre Rosso is the chairman of the
World Economic Forum USA.
Jeff Immelt Jeff Immelt is the chairman and CEO of
General Electric.
Jim Burke In September 2012, Jim Burke passed away at
the age of 87.
Jim Thompson Jim Thompson teaches classes as part of
Stanford University’s Continuing Studies
Program and has authored eight books.
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Joe Rogers Jr. Joe Rogers Jr. has served as chairman and CEO
of Waffle House since 1973.
Joel Peterson Joel Peterson is chairman of the board at
JetBlue Airways and a faculty member at the
Graduate School of Business at Stanford
University.
John Browne John Browne is managing director and
managing partner (Europe) of Riverstone
Holdings.
John Donahoe John Donahoe has been president and CEO of
eBay since 2008.
John Morgridge John Morgridge is a trustee of Stanford
University, where he teaches management at
the Graduate School of Business.
John Thain John Thain is chairman and CEO of CIT.
John Whitehead In February 2015, John Whitehead passed
away at the age of 92.
Jon Huntsman Sr. Jon Huntsman Sr. is executive chairman of
Huntsman Corporation.
Jonathan
Doochin
Jonathan Doochin is CEO of Soligent
Holdings.
Judy Haberkorn Judy Haberkorn serves as a director for
Computer Sciences Corporation.
Judy Vredenburgh Judy Vredenburgh is the president and CEO of
the Girl Scouts.
Julian Flannery Julian Flannery is the cohead of Global
Research at Gerson Lehrman Group.
Keith Krach Keith Krach serves as chairman and CEO of
DocuSign.
Kent Thiry Kent Thiry is CEO of HealthCare Partners.
Kevin Sharer Kevin Sharer is a senior lecturer of business
administration at Harvard Business School.
WHERE ARE THEY NOW? 283

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Kris Johnson Kris Johnson is president of Affinity Capital
Management.
Lisa Dawe Lisa Dawe is regional president, West Coast, of
IntegraMed Fertility.
Lynn Forester de
Rothschild
Lynn Forester de Rothschild serves on the
boards of directors of the Economist Group,
Weather Central, Christie’s International, and
the Estée Lauder Companies.
Marianne
Toldalagi
Marianne Toldalagi is president of BTA-
Partners.
Marilyn Carlson
Nelson
Marilyn Carlson Nelson is former chairman
and former CEO of Carlson.
Mark Reynoso Mark Reynoso is CEO of EcoSense Lighting.
Martha Goldberg
Aronson
Martha Goldberg Aronson is executive vice
president of Ecolab.
Michele Hooper Michele Hooper is CEO of MJH Consulting.
Mike Baker Mike Baker was formerly CEO of Arthrocare.
Mike Sweeney Michael Sweeney is CEO of Steinway.
Nancy Barry Nancy Barry is founder and president of
Enterprise Solutions to Poverty.
Narayana Murthy Narayana Murthy is the founder of Infosys,
where he served as CEO from 1981 to 2002
and as board chair until 2011. He is on the
boards of HSBC, DBS Bank, Unilever,
ICICI Bank, and NDTV.
Ned Barnholt Ned Barnholt is chair of KLA-Tencor.
Nelson Mandela In December 2013, Nelson Mandela passed
away at the age of 95.
Oprah Winfrey Oprah Winfrey is president of Harpo
Productions.
Paula Rosput
Reynolds
Paula Rosput Reynolds is president and CEO
of PreferWest.
284 WHERE ARE THEY NOW?

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Penny George Penny George is president of the George
Family Foundation.
Phil McCrea Philip McCrea is CEO of ClearPoint.
Randy Komisar Randy Komisar is a partner at Kleiner Perkins
Caufield & Byers.
Richard Grasso From 1995 to 2003, Richard Grasso was
chairman and CEO of the New York Stock
Exchange.
Richard Tait Richard Tait is CEO and cofounder of the
sports drink company Golazo.
Rob Chess Rob Chess is the chairman of OPX
Biotechnologies.
Ryan Frederick Ryan Frederick is the founder and president of
Point Forward Solutions.
Sam Palmisano Sam Palmisano was chair and CEO of IBM
from 2002 until 2011.
Steve Rothschild Steve Rothschild is the founder and chair of
Twin Cities RISE!
Tad Piper Tad Piper is a board member and former chair
and CEO of Piper Jaffray.
Tom Tierney Tom Tierney is the chairman and cofounder of
the Bridgespan Group.
Warren Bennis In July 2014, Warren Bennis passed away at
the age of 89.
Warren Buffett Warren Buffett is chairman and CEO of
Berkshire Hathaway.
Wendy Kopp Wendy Kopp is founder and CEO of Teach
For America, and CEO of Teach For All.
Zyg Nagorski In July 2011, Zyg Nagorski passed away at the
age of 98.
WHERE ARE THEY NOW? 285

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WEBBLAST04 07/02/2015 3:24:21 Page 287
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Knoop, Carin-Isabel, Krishna Palepu, Matthew Preble, and Bill George.
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WEBBLAST05 07/02/2015 3:26:32 Page 293
About the Author
Bill George is a senior fellow at Harvard Business School (HBS),
where he teaches leadership in executive education programs. He
was professor of management practice from 2004 to 2014. He is the
author of four best-selling books: Authentic Leadership, True North,
Finding Your True North, and 7 Lessons for Leading in Crisis, and
coauthor of True North Groups with Doug Baker Sr. He is faculty
chair of HBS’s executive education program Authentic Leadership
Development and cochair of Leading Global Enterprises.
He was chair and CEO ofMedtronic, the world’s leading medical
technology company. Under his leadership, Medtronic’s market
capitalization grew from $1.1 billion to $60 billion, averaging
35 percent a year. He joined Medtronic in 1989 as president and
COO, was CEO from 1991 to 2001, and was chairman of the board
from 1996 to 2002. Earlier in his career, he was an executive with
Honeywell and Litton Industries and served in the U.S. Department
of Defense.
He currently serves as a director of Goldman Sachs and theMayo
Clinic and recently served on the boards of ExxonMobil, Novartis,
and Target. He is a director of Minnesota’s Destination Medical
Center Corporation and World Economic Forum USA.
He is the recipient of the 2014 Bower Award for Business
Leadership from the Franklin Institute and the 2015 Lawrence
A. Wein Award from CECP, and was elected to the National
Academy of Engineering in 2012. He has been named one of the
Top 25 Business Leaders of the Past 25 Years by PBS, Executive of
293

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the Year by the Academy of Management, and Director of the Year
by the National Association of Corporate Directors.
He received his bachelor of science in industrial engineering
with high honors from Georgia Tech and his MBA with high
distinction from Harvard University, where he was a Baker Scholar.
He has received honorary PhDs from Georgia Tech, Mayo Medical
School, the University of St. Thomas, Augsburg College, and Bryant
University. During 2002 to 2003, he was professor at the Interna-
tional Institute for Management Development and École Polytech-
nique in Lausanne, Switzerland, and executive-in-residence at Yale
School of Management in 2003.
He and his wife, Penny, reside in Minneapolis, Minnesota.
294 ABOUT THE AUTHOR

WEBBLAST06 07/02/2015 3:28:26 Page 295
Acknowledgments
I am deeply indebted to many people who contributed to Discover
Your True North and to the ideas contained in these pages. First to
Zach Clayton, who has been my partner throughout the process.
Zach has added immeasurably to the quality of the text through his
interviews of significant people in the book, his ideas, and his
insightful editing. Additionally, he has helped me understand
younger generations and especially their use of social media.
Next to Peter Sims, who coauthored the first edition of
True North. Peter led the research process and interviews that
provided the insights that still form the intellectual structure of
this book, and is continuing his work as a thought leader—most
recently with the publication of Little Bets. Diana Meyer contributed
a great deal to the interviews and insights for the first edition and
taught these ideas at New York University and Babson College.
The pioneering work on leadership by the late Warren Bennis,
my mentor and dear friend, provided the intellectual basis for many
of the ideas. He wisely guided me through the editing process in my
first four books. David Gergen has been an invaluable partner and
friend in advancing the new ideas on leadership throughout the past
decade.
Without our leadership group at Harvard Business School
(HBS), especially the research, leadership theories, and brilliant
teaching of Dean Nitin Nohria, Scott Snook, and Tom DeLong, the
new ideas in Discover Your True North would never have come
together. I am also grateful to many other HBS colleagues for their
insights, wisdom, and help in forming my ideas: most notably,
295

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Michael Porter, Rob Kaplan, Jay Lorsch, Krishna Palepu, Clayton
Christensen, Ranjay Gulati, Amy Edmondson, Joshua Margolis,
Rosabeth Moss Kanter, Das Narayandas, Leslie Perlow, Lynn Paine,
and Joe Bower.
I am grateful to the 47 new leaders whose stories find prominent
roles in the ideas of Discover Your True North, and to the 125 leaders
who offered their personal stories and perspectives on leadership for
the first edition ofTrue North. They are the role models for authentic
leadership who provide evidence every day of the validity of these
ideas as they practice them in the world.
Assistance from Shannon Vargo, Michael Friedberg, Tiffany
Colon, Karen Murphy, and other John Wiley & Sons staff made the
publication process smooth. Lauren Schwenk of Three Ships con-
tributed edits and designs. Diane Weinhold and Stacy Walcheski of
the George Family Office provided helpful support and project
management.
Only with the insights, counsel, encouragement, and support of
my wife, Penny, has this book been made possible. In discovering
their True North and putting authentic leadership into practice, our
sons, Jeff and Jon, and daughters-in-law, Renee Will and Jeannette
Lager, have also helped these ideas come to life.
To all of you, I am deeply grateful for your support and for making
this world a better place through your leadership.
296 ACKNOWLEDGMENTS

WEBBINDEX 07/02/2015 3:32:12 Page 297
Index
NOTE: Page references in italics refer to figures.
A
Abpro, 30–31
Accel Partners, 152
accountability, 235–238
active listening, 227
adaptability, for Global Intelligence, 252
adversity, overcoming. See Crucibles
Affiliative leadership style, 239–241, 240
African National Congress (ANC), 183
Alcoholics Anonymous (AA), 143
Algorta, Pedro, 65–66
Alibaba, 4, 265–268
alignment
for Global Intelligence, 253–254
mission and, 228
Purpose and, 214–217
Allaire, Paul, 220
Allen, Woody, 225
American Icon (Hoffman), 236
American Red Cross, 171, 186–187
Amgen, 40
Andreessen, Marc, 152
Apple, 98–99, 153, 190–192
Armstrong, Lance, 52–53
Aronson, Dan, 168
Aronson, Martha Goldberg, 151, 167–169
Arthrocare, 50–51
Astra, 201
authenticity
defined, 3–5, 8–9
journey to, 25–27, 26
key challenges of, 78, 78
See also Integrated Life; Self-Awareness;
Support Team; Sweet Spot; Values
Authentic Leadership Development
(ALD) (Harvard course), 157
Authentic Leadership (George), 3, 39
Authentic Leadership Institute, 68
Avon, 205
awareness, for Global Intelligence,
252–253
B
Bain & Company, 160–163
Baker, Doug, Jr., 187–188
Baker, Doug, Sr., 155–157
Baker, Mike, 50–51
Bakken, Earl, 120–121, 196
Barnes, Brenda, 2
Baxter Healthcare, 207–208
Bennis, Warren
on “balance,” 167
On Becoming a Leader, 61
Geeks and Geezers, 35
on preparing for unexpected, 156
Rationalizers and, 50
Schultz influenced by, 149
True North concept and, 1
Berkshire Hathaway, 123–128, 131, 132
Bernanke, Ben, 33
Big Brothers Big Sisters, 147–148
Binder, Gordon, 134–135
Blankfein, Lloyd, 99, 201
Bloomberg, Michael, 36–38
Bloomberg (company), 36–38
Boeing, 236
Bolton, Josh, 33
Bower Award (Franklin Institute), 115
297

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Bowles, Erskine, 36
Bravewell Collaborative, 212–213
Brennan, Jack, 26
bribes, resisting, 108
Britt, Tracy, 131–132
British Petroleum (BP), 97
Browne, Lord John, 97–98
Bryant, John Hope, 89–90
“buckets,” for Integrated Life, 169–171,
170
Buffett, Warren, 123–128, 131, 132,
151, 226
Burke, Jim, 106
Burkle, Ron, 193
Burns, Ursula, 220, 222–223
Bush, George W., 32, 33
C
C3I, 68
Cambridge Union (Cambridge
University), 80
Campbell, Bill, 152–154, 174
Carlson, 72–73, 229–232
Carlson, Curtis, 229–230
Carol, Taylor, 66–67
Carpenter, Paul, 66
Catmull, Ed, 191
Center for Public Leadership (Harvard
University), 105
CEO Summit (Microsoft), 127
Chan, Eugene, 29–31
Chan, Ian, 29–31
Charles de Gaulle Airport, 108
Charles Schwab & Company, 85–87,
139–141
Chase, Truddi, 62
Chizen, Bruce, 152, 153, 154
choices, Integrated Life and, 167
Christensen, Clay, 176
Churchill, Winston, 174
Ciba-Geigy, 59–60
Citigroup, 116–117
Claris, 153
Clark University, 23
Clayton, Zach, 3–4, 189–190
ClearPoint, 169
Clinton, Bill, 92
closed-loop accountability, 235–238
CNN, 105
Coaching leadership style, 239–241, 240
Coca-Cola, 216, 250
collaboration, for Global Intelligence, 254
Collins, Art, 38, 168
community involvement, 175
Compass (Unilever), 244
Condit, Phil, 236
Conscious Capitalism (Mackey), 192, 270
Consensus leadership style, 239–241, 240
Cook, Tim, 98–99, 191–192
Cornell, Brian, 225–226
Cowles Media, 136
Cox, Chris, 54
Cox, Dave, 136
Craig, Nick, 11, 68
“Creating Shared Value” (Porter, Kramer),
271–272
crisis communication, 106, 119–120
Crucible, The (Miller), 61
Crucibles, 57–76
Algorta and, 65–66
Carol and, 66–67
defined, 61–62
George and, 73–75
I to We leadership transformation and,
190–193
McCrea and, 68–70
Nelson and, 72–73
overview, 14
post-traumatic growth from, 67–68
Sweeney and, 70–72
Vasella and, 57–60
Winfrey and, 62–64
Crystal Dynamics, 92
Csikszentmihalyi, Mihaly, 130
curiosity, for Global Intelligence, 253
D
Dartmouth College, 34
DaVita, 154–155, 175, 232–234
Dawe, Lisa, 175
Dealing with China (Paulson), 35
Dillon, David, 96, 100, 150–151, 215
Dillon Company, 150
Dimon, Jamie, 148
298 INDEX

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Directive leadership style, 239–241, 240
Discover Your True North Fieldbook: A
Personal Guide to Finding Your
Authentic Leadership, The (Craig,
Snook), 11
Discover Your True North (George)
organization of, 9–11, 10
research for, 3–4
DocuSign, 117–118
Donahoe, Eileen, 160–163
Donahoe, John, 148, 160–163, 240
Donald, Jim, 19
Donaldson, Bill, 48–49
Drucker, Brian, 66
dual careers, managing, 164–165
Dubinsky, Donna, 138, 152, 153, 154
Dunn, Debra, 130
E
eBay, 148, 163
Ecolab, 151, 187–188
economic crisis of 2008
Buffett and, 131
failed leaders and, 6
Krawcheck and, 116–117
Paulson and, 33–35
stakeholders in society and, 269
Ehrlichman, John, 33
emotional intelligence (EQ), 3, 83–84
Emotional Intelligence (Goleman), 84
empathy, for Global Intelligence, 253
Empowerment, 219–242
accountability and, 235–238
creating culture of, 229–235
engaged leaders and, 224–226
leadership style and, 239–242, 240
Mulcahy and, 219–224
overview, 179, 219
respect and, 226–228
engagement
Engaged leadership style, 239–241, 240
by leaders, 224–226
Enron, 3, 6, 118–119
Erikson, Erik, 27
ethical boundaries, 106–110, 107,
118–120. See also Values
Expert leadership style, 239–241, 240
extrinsic motivation
avoiding trap of, 135–137
intrinsic motivation compared to,
128–135, 129
Eyewitness to Power (Gergen), 225
F
Facebook, 26, 151–152, 172–173
failure, fear of, 45–46
Falik, Abby, 261–262
family life, career and. See Integrated Life
Federal Trade Commission, 193
feedback, for Self Awareness, 85–87,
95–96
Female Woman, The (Huffington), 80
Fields, Mark, 238
Firestone, Jim, 223
Ford, Bill, 237
Ford Motor Company, 236–238
Franklin Institute, 115
Frazier, Ken, 4, 199–204
Friedman, Milton, 192
Friedman, Steve, 33
friendship, building, 154–155
Fry, Chuck, 150
Fudge, Ann, 9, 31, 136, 208
Fuld, Richard, 53–54, 146
G
Gardner, John, 21
Garlinghouse, Brad, 55
Gates, Bill, 124, 152
Gates, Bill, Sr., 18
Gates Foundation, 124
Geeks and Geezers (Bennis), 35
General Electric (GE), 5, 31–33,
132, 133
General Mills (GM), 24, 32, 213–214
General Motors (GM), 117
Generativity (Phase III), 27, 35–40
George, Bill
Authentic Leadership, 3
Authentic Leadership Development
(ALD) (Harvard course), 157
biographical information, 38–39, 73–75
at Honeywell, 165, 194–196, 250
at Litton, 164
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George, Bill (continued)
at Medtronic, 2, 5, 38, 39, 195–196,
227 (See also Medtronic)
research by, 3–4
spirituality of, 176–177
True North Groups, 155
George, Jeff, 165
George, Jon, 165, 212
George, Penny, 39, 61, 75, 157, 165, 195,
211–213
Gergen, David, 103–105, 225
Gerstner, Lou, 109
Glass Closet, The (Browne), 98
Glass-Steagall Act, 145
Gleevec (Novartis), 60, 66
Global Citizen Year, 261–262
Global Leadership, 243–263
challenges of, 247–251
emerging leaders of, 256–262
future of, 262–263
Global Intelligence (GQ), developing,
251–255
Global Intelligence (GQ), increasing,
255–256
overview, 179, 243
Polman and, 243–247
Glory Seekers, 47, 52–53
Gluk, Michael, 51
Goldberg, David, 172
Goldman Sachs, 33, 97, 99
Goleman, Daniel, 84
Gomes, Reverend Peter, 206
Google, 94–95
Graham, Benjamin, 125–126
Graham, Don, 151–152
Grasso, Richard, 48–49
Greenleaf, Robert, 181
Gupta, Rajat, 42–44
Gutfreund, John, 37
H
Haberkorn, Judy, 96, 119–120
Haldeman, H. R. “Bob,” 104, 112–113
Harvard Business Review, 271–272
Harvard University
Harvard Business School, 39, 149, 157
Kennedy School, 105
Hawkins, Jeff, 138
headquarters paradigm, flipping, 249–250
Highlands Coffee, 256–257
Hightail, 55
H.J. Heinz, 216
Hoffman, Bryce, 236
Honeywell, 165, 194–196, 217, 250
Hooper, Michele, 207–208
Horn, Alan, 129–130
How Will You Measure Your Life?
(Christensen), 176
HQ Raleigh, 55
HSBC, 249
Hsieh, Tony, 234–235
Huffington, Arianna, 4, 79–82, 93–94
Huffington Post, 4, 79–82
Huntsman, Jon, 111–115
Huntsman, Karen, 113, 115
Huntsman, Mark, 113
Huntsman Corporation, 111–115
I
IBM, 109–110, 118
Immelt, Jeff, 31–33
Imposters, 47–48
individuality, of leaders. See I to We
Infosys Technologies, 107, 108, 269–270
insider trading, 42–44, 128
intrinsic motivation, 128–135
Integrated Life, 159–178
for all aspects of life, 176–177
blending career and family life, 163–164
buckets of life for, 169–171, 170
choices and trade-offs of, 167–169
Donahue and, 160–163
family as priority for, 172–173
finding time for oneself and, 174–175
for improving leadership, 166
managing dual careers, 164–166
measuring success and, 176
overview, 78, 78, 159–160
staying grounded with, 171–172
staying true to roots for, 173–174
integration, for Global Intelligence,
254–255
Intelligent Investor, The (Graham),
125–126
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intrinsic motivation, 128–135, 129
introspection, 92–95, 175
Irick, Jaime, 181–182
Ishrak, Omar, 121, 248–249
I to We, 181–198
defining experiences of, 194–196
I versus We leaders, 184–186, 186
Mandela and, 182–184
overview, 179, 181–182
transformation and Crucibles, 190–193
transformation challenges, 186–190
J
Jackson, Peb, 197
Jackson, Reverend Jesse, 90
Jager, Durk, 84
James, William, 2
Jefferson, Thomas, 174
Jimenez, Jim, 251, 255
Jobs, Steve, 190–192
Johari Window, 96–97, 97
Johnson & Johnson, 106
J.P. Morgan, 148
Jung, Andrea, 205
K
Kabat-Zinn, Jon, 73, 93, 101
Kent, Muhtar, 216
King, Reatha Clark, 5, 22–24, 100
King, Rodney, 90
Kleiner Perkins Caufield & Byers, 27–28
Klintworth, Gail, 246
Komisar, Randy, 27–28, 92–94, 152, 153,
154
Kopp, Wendy, 28, 262
Kovacevich, Dick, 21–22, 84
Krach, Keith, 117–118
Kraft, 216
Kramer, Mark, 271–272
Krawcheck, Sallie, 116–117
Kroger, 96, 150, 215
L
Langer, Bob, 29
Langer, Ellen, 101, 163
Lasseter, John, 191
Laurent, Andre, 250
Lay, Ken, 118–119
leadership
developing, 77–78 (See also Integrated
Life; Self Awareness; Support Team;
Sweet Spot; Values)
effectiveness of, 179 (See also
Empowerment; Global Leadership;
I to We; Purpose)
journey to, 13–14 (See also Crucibles;
Life Story; Losing Your Way)
styles of, 239–241, 240
Leading by Values initiative (IBM),
109–110
Leading (Phase II), 27, 31–35
Lehman Brothers, 53–54, 146
Leukemia & Lymphoma Society, 67
Li, Peilung, 258–259
Life Story, 15–40
for authentic leadership, 25–27, 26
to define leadership, 20–24
Generativity (Phase III), 27, 35–40
Leading (Phase II), 27, 31–35
learning from others, 24–25
overview, 13
Preparing for Leadership (Phase I),
27–31
Schultz and, 15–20
Lipson, Jes, 55
listening, importance of, 227
Litton, 164
Loescher, Peter, 250
Lofberg, Per, 137
loneliness, of leaders, 46–47
Loners, 47–48, 53–54
Long Walk to Freedom (Mandela), 183
Losing Your Way, 41–56
Glory Seekers, 47, 52–53
Gupta and, 42–44
Imposters, 47–48
leader roles and, 56
Loners, 47–48, 53–54
overview, 13, 41
Rationalizers, 47, 49–51
reasons for, 44–47
Shooting Stars, 48, 54–55
Love Leadership (Bryant), 89–90
Lubrizol, 128
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M
Ma, Jack, 4, 265–268
Mackey, John, 192–193, 270
Mandela, Nelson, 182–184
Manwani, Harish, 246, 255
marriage, work and. See Integrated Life
Marshall, Paul, 227
Mascarenhas, Rodrigo, 260
Maslow, Abraham, 57
Mayer, Diana, 4
McCrea, Annika, 169
McCrea, Philip, 68–70, 169–170
McGovern, Gail, 171, 186–187
MCI, 133–135, 241
McKinsey, 42–44, 172–173
McLean, Andrew, 4
McNerney, Jim, 237
Medco, 137
meditation, 92–95
Medtronic
Aronson and, 168
Baker and, 50
George and, 2, 5, 38, 39, 195–196, 227
global locations of, 248
heart valve factory of, 228
O’Connell and, 172
Values and, 120–121
mentoring, 148–154, 203–204
Merck, George W., 200
Merck (company), 4, 199–204, 229
Messina, Matthew, 67
Metropolitan State University, 23–24
Michigan State University, 209–210
Microsoft, 127
Miller, Arthur, 61
mindfulness, 100–101
Mindfulness (Langer), 101
mission, aligning with, 228
Mondelez, 216
Moore, Ann, 136, 205
Moret, Marc, 59, 60
motivation
balancing, 137–138
Values and, 106–107
Moulton, Seth, 205–207, 217
Mulally, Alan, 235–238, 240
Mulcahy, Anne, 125, 167, 219–224, 240
Munger, Charlie, 127
Murthy, Akshata, 174
Murthy, Narayana, 107–109, 241,
269–270
N
Nair, Leena, 246–247
National Association of Corporate
Directors, 5, 24
National Commission on Fiscal
Responsibility, 36
Nelson, Marilyn Carlson, 72–73, 229–232
neoteny, 35–36
New York Stock Exchange, 48–49
“New York Times test,” 119
NeXT, 191
Nhat Hanh, Thích, 101
Nixon, Richard, 33, 103–104, 112–113
No End in Sight (documentary), 206
Nohria, Nitin, 149
Nooyi, Indra, 4, 215–217
Novartis, 46, 57–60, 251, 255
Numenta, 138
O
Obama, Barack, 34, 36, 211
O’Connell, Chris, 155, 172
O’Leary, Denise, 175, 233
Omnivore’s Dilemma, The (Pollan), 193
On Becoming a Leader (Bennis), 61
onion, peeling back (for Self-Awareness),
87–89, 88
On the Brink (Paulson), 34
openness, 96–99, 97, 147–148
Operation Hope, 89–92
P
Paley, Bill, 45
Palmisano, Sam, 109–110
PalmPilot, 138
Pampered Chef, 132
Pandit, Vikram, 116–117
Parker, Sean, 152
Paulson, Hank, 33–35, 53–54
Paulson, John, 71
Paulson Institute, 35
Pelosi, Nancy, 34
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Peltz, Nelson, 216
PepsiCo, 4, 215–217
Pereverzev, Vitaliy, 124
perfection, Self-Awareness compared to,
87, 91
Pfizer, 202
Phibro, 37
Piper, Tad, 142–145
Piper Jaffray, 142–145
Pixar, 191
Poetry of Self Compassion, The (Whyte),
100
political issues, global context of, 247–248
Pollan, Michael, 193
Polman, Paul, 4, 7, 243–247, 272
Porter, Michael, 271–272
Pottruck, David, 85–87
power, vulnerability as, 89–92
Preparing for Leadership (Phase I), 27–31
Princeton University, 28
Procter & Gamble, 84, 243
Purpose, 199–218
action from, 208–214
aligning organization for, 214–217
of business, 268–271, 271
defining, 204–208
Frazier and, 199–204
keeping True North in sync with,
217–218
overview, 179, 199
R
Rajaratnam, Raj, 42–44
Rationalizers, 47, 49–51
reflection, 92–95
reframing, 25–26
Regeneron, 20
religious practices, importance of, 175
respect, as mutual, 226–228
Reynolds, Paula Rosput, 147
Richardson, Elliot, 112
Rivonia Trial, Mandela and, 183–184
Robb, Walter, 193
Rogers, Tamara, 257–258
Rollins, Leslie, 150
Rosso, Jean-Pierre, 7, 136
Rothschild, Steve, 213–214
S
Safeco, 147
Salomon Brothers, 37, 128
Sandberg, Sheryl, 26, 152, 172–173
Sandoz, 59
Sara Lee, 2
Schultz, Howard, 15–20, 149, 225–226
Schulz, Mark, 238
Schwab, Charles “Chuck,” 139–141
Schwab, Klaus, 271
Scully, John, 190
Search Inside Yourself Leadership
Institute, 95
Seattle Children’s Hospital, 66–67
Securities and Exchange Commission,
139, 193, 220
self-acceptance, 99–100
Self Awareness, 79–102
emotional intelligence for, 83–84
feedback for, 85–87, 95–96
gaining, 82–87, 83
Huffington and, 79–82, 93–94
for leadership, 7
learning from others, 24–25
mindfulness for, 100–101
openness for, 96–99, 97
overview, 78, 78, 79
peeling back onion for, 87–89, 88
reflection and introspection for, 92–95
self-compassion and self-acceptance for,
99–100
vulnerability as power for, 89–92
“Servant as Leader, The” (Greenleaf),
181
servant leadership, 181–182
ShareFile, 55
Sharer, Kevin, 5, 40, 132, 133, 241–242
Shooting Stars, 48, 54–55
Shultz, George, 148, 174
Siemens, 250
Simpson, Alan, 36
Sims, Peter, 4
Skilling, Jeff, 3, 118–119
Smith, Roger, 32
Smith Barney (Citigroup), 116–117
Smith College, 81
Snook, Scott, 11
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social lives, Support Team and, 148
SoftBank Investments (SBI), 258–259,
267
Sojourners, 4, 210
Sokol, David, 128
Son, Masayoshi, 267
South African Communist Party, 183
spirituality, importance of, 175
Stafford, William, 218
stakeholders in society, 265–273
becoming, 271–273
Ma and, 265–268
Purpose and, 268–271, 271
Stanford Graduate School of Business, 84
Starbucks, 15–20, 149
Steinway, 70–72
Stonecipher, Harry, 236–237
strengths, building, 137–139
stress management
finding time for oneself, 174–175
staying grounded for, 171
See also Integrated Life
Stumpf, John, 22
success, measuring, 176
Support Team, 142–158
building, 146–147
building, with true friendships, 154–155
mentoring and, 148–154
overview, 78, 78, 142
Piper and, 142–145
sharing openly with, 147–148
True North Groups, 155–157
Sweeney, Mike, 70–72
Sweet Spot, 123–141
Buffett and, 123–128, 131
building on strengths for, 137–139
extrinsic motivation, avoiding, 136–137
finding, 130, 130–131
intrinsic versus extrinsic motivation,
128–135
overview, 78, 78, 123
Schwab and, 139–141
sycophants, problem of, 45
T
Tan, Chade-Meng, 94–95
Target, 225–226
Teach for America, 28–29, 262
Thai, David, 256–257
Third Metric (Huffington), 81
Thiry, Kent, 154–155, 175, 232–234
Three Ships, 189–190
Thrive (Huffington), 81
Tierney, Tom, 161
Time, Inc., 136, 205
Tour de France, 52–53
Trinity Evangelical Divinity School, 210
Troubled Asset Relief Program (TARP),
33–35
“True Courage” (Carol, Messina), 67
True North, 1–11
authenticity and, 3–5, 8–9
defined, 1–3
discovering, 9–11, 10
leadership transformation and, 5–9, 8
True North Groups, 155–157
True North Groups (George, Baker),
155
Tylenol (Johnson & Johnson), 106
U
Unilever
Compass, 244
Manwani and, 246, 255
Polman and, 4, 7, 243–247, 272
Rogers and, 257–258
Unilever Leadership Development
Program (ULDP), 246
Unilever Sustainable Living Plan
(USLP), 244
United Automobile Workers (UAW),
237
Univision, 138
University of Chicago, 23, 35
University of Kansas, 96
University of North Carolina, 36
U.S. Bancorp, 145
U.S. Business Hall of Fame, 204
U.S. Congress, Moulton and, 207
U.S. Genomics, 29–30
U.S. Health, Education, and Welfare
(HEW), 112
U.S. Health and Human Services, 21
U.S. Treasury Department, 128
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V
Vagelos, Roy, 20, 201, 203–204, 229
Values, 103–122
ethical boundaries, setting, 118–120
ethical boundaries and leadership
principles, 106–110, 107
Gergen and, 103–105
Medtronic and, 120–121
overview, 78, 78, 103
testing, under pressure, 110–118
Vanguard, 26
Vasella, Anne-Laurence, 59
Vasella, Daniel, 46, 57–60, 251
Venter, Craig, 29, 240
Verizon, 96, 119–120
Vioxx (Merck), 202
Vitesse Learning, 68–70
Vivra Specialty Partners (VSP), 233
vocation, pursuing, 210–211
Vredenburgh, Judy, 147–148
vulnerability
as power, 89–92
support and, 145
W
Wallin, Win, 196
Wallis, Jim, 4, 208–211
Walt Disney Studios, 129–130
Washington Post Company, 151
Watson, Thomas, 109
Welch, Jack, 5, 7, 32, 133, 224
Wells Fargo, 21–22, 84
Wherever You Go (Kabat-Zinn), 73
Whitman, Meg, 163
Whole Foods Market, 192–193, 270
Whyte, David, 100
Wild Oats, 193
Winfrey, Oprah, 62–64
“Woodstock for Capitalists,” 127
work/life balance. See Integrated Life
WorldCom, 6
World Economic Forum, 7, 211, 257,
271
X
Xerox, 17, 124, 167, 219–224
Y
Yale University, 39
York College, 23
Young, Andrew, 92
Young & Rubicam, 9
YouSendIt, 55
Z
Zappos, 234–235
Zedong, Mao, 268
Zuckerberg, Mark, 151–152, 173
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WILEY END USER LICENSE
AGREEMENT
Go to www.wiley.com/go/eula to access Wiley’s ebook
EULA.

www.wiley.com/go/eula

Discover Your True North: Expanded and Updated Edition
Contents
Preface:
The Remarkable Legacy of Warren Bennis
Foreword
Introduction
Part One:
Your Journey to Leadership
Chapter
1: Your Life Story
Howard Schultz’s Leadership Journey
Your Life Story Defines Your Leadership
Dick Kovacevich: From Grocery Store Clerk to Premier Banker
Reatha Clark King: From Cotton Fields to the Boardroom
What Is Your Life Story?
The Journey to Authentic Leadership
Phase I: Preparing for Leadership
Wendy Kopp: Stepping Up at 21
Ian Chan: Creating a Scientific Revolution
Phase II: Leading
Jeff Immelt: Hitting the Wall
Hank Paulson: A Life of Service in All Sectors
Phase III: Generativity
Erskine Bowles: Connecting Public Service and Private Sectors
Michael Bloomberg: Going His Own Way
Exploring Leadership after Phase II
Exercise: Your Life Story and Journey to Authentic Leadership
Chapter
2: Losing Your Way
The Tragedy of Rajat Gupta
Why Leaders Lose Their Way
Losing Touch with Reality
Fearing Failure…
…and Craving Success
The Loneliness Within
Derailing: Losing Sight of Your True North
Imposters
Richard Grasso’s Fall from Grace
Rationalizers
The Collapse of Mike Baker
Glory Seekers
Lance Armstrong’s Ruthless Quest for Glory
Loners
Richard Fuld Leads Lehman into Bankruptcy
Shooting Stars
A Tale of Two Tech Entrepreneurs
Heroes of Their Own Journeys
Exercise: Why Leaders Lose Their Way
Chapter
3: Crucibles
Daniel Vasella’s Long Journey
Crucibles of Leadership
Oprah Winfrey: Reframing Her Story at 36
Pedro Algorta: Turning Wounds into Pearls
Taylor Carol: Terminal Cancer Survivor
Post-Traumatic Growth
Philip McCrea: Learning from Failure
Mike Sweeney: Dealing with Personal Illness
Marilyn Carlson Nelson: Losing a Loved One
My Crucibles Came Early
Coping with Tragedy
Exercise: Your Greatest Crucible

Part Two:
Developing as an Authentic Leader
Chapter
4: Self-Awareness
Arianna Huffington: Redefining Success
Becoming Self-Aware
The Importance of Emotional Intelligence
David Pottruck: Journey to Self-Awareness
Peeling Back the Onion
Vulnerability Is Power
Reflection and Introspection
Randy Komisar’s Struggle to Find His Track
Chade-Meng Tan, Google’s Jolly Good Fellow
The Importance of Feedback
Opening up Hidden Areas
Lord John Browne and Tim Cook: Emerging from the Closet
“The Civil Rights Issue of our Time”
Self-Compassion and Self-Acceptance
Becoming a Mindful Leader
Exercise: Knowing Your Authentic Self
Chapter
5: Values
David Gergen: Crisis Strengthened His Values
Values, Leadership Principles, and Ethical Boundaries
Narayana Murthy: Building a Company with Principles
Sam Palmisano: Leading by Values
Testing Values under Pressure
Jon Huntsman: Testing Values under Pressure
Sallie Krawcheck: Putting Clients First
Keith Krach: When Values Conflict
Setting Ethical Boundaries
Judy Haberkorn: Transparency Is the Right Thing to Do
Values Challenges at Medtronic
Exercise: Practicing Your Values and Principles
Chapter
6: Sweet Spot
Warren Buffett Finds His Sweet Spot
Finding His Sweet Spot
Buffett versus Wall Street
Intrinsic and Extrinsic Motivations
Finding Your Sweet Spot
Exploring Warren Buffett’s Motivations
Tracy Britt: Heeding Your Call
Kevin Sharer: Discovering His Sweet Spot
Avoiding the Trap of Extrinsic Motivations
Balancing Your Motivations
Build on Your Strengths
Chuck Schwab’s Journey to His Sweet Spot
Exercise: Your Sweet Spot
Chapter
7: Support Team
Tad Piper’s Support Team in His Crisis
Building Support Teams
The Power of Sharing Openly
Mentoring: A Two-Way Street
Mark Zuckerberg’s Mentors Accelerated His Growth
Coach Campbell: Silicon Valley’s Leading Mentor
Building True Friendships
True North Groups
Exercise: Building Your Support Team
Chapter
8: Integrated Life
John Donahoe: Choosing to Live Fully
Blending Careers with Family Life
Managing Dual Careers
Hitting the Wall at Home
An Integrated Life Makes You a Better Leader
Making Choices and Trade-Offs
Martha Goldberg Aronson: Taking on Added Responsibility
The Buckets of Your Life
Staying Grounded by Integrating Your Life
Prioritizing Your Family
Focusing on What Matters
Staying True to Your Roots
Finding Time for Yourself
Spiritual and Religious Practices
Community
Measuring Your Success
Integrating All Aspects of Your Life
Exercise: The Integrated Leader

Part Three:
Your True North Meets the World
Chapter
9: I to We
Nelson Mandela: Seeking Reconciliation, Not Retribution
Mandela Emerges as a Leader
From Hero’s Journey to Leader’s Journey
Challenges in Making the Transformation
Gail McGovern: “It’s Not Fair”
Doug Baker Jr.: A Call to the Heart
Zach Clayton: It’s Not about Your Resume
Crucibles Help Make the Transformation
Steve Jobs: Learning in the Wilderness
John Mackey: Learning to Share Power
My Defining Leadership Experience
Taking the I to We Journey
Exercise: Your Transformation from I to We
Chapter
10: Purpose
Ken Frazier: Medicine for the People
Defending Merck Science
A Mentor’s Story
What’s the Purpose of Your Leadership?
Dedicating Your Life to Public Service
Opening up Opportunities
Turning Purpose into Action
Jim Wallis: Taking Faith to the Streets
Penny George: It’s Never Too Late to Become a Leader
Steve Rothschild: Finding His Calling
Aligning Your Organization and Shared Purpose
Keeping Your True North and Purpose in Sync
Exercise: The Purpose of My Leadership
Chapter
11: Empowerment
Anne Mulcahy: Empowering People in Crisis
The Engaged Leader
Mutual Respect: The Basis for Empowerment
Treat Others as Equals
Listen Actively
Learn from People
Share Life Stories
Align around the Mission
Creating an Empowered Culture
Marilyn Carlson Nelson: From Sweatshop to Empowerment
Kent Thiry: The Mayor of DaVita
Tony Hsieh’s Radical Transparency
Empowerment Is Accountability
Alan Mulally: Empowerment with Closed-Loop Accountability
Your Leadership Style
Selecting Your Altitude
Exercise: Empowering Other Leaders
Chapter
12: Global Leadership
Paul Polman: Transforming Unilever’s Global Leadership
Challenges of the Global Context
Understanding Geopolitical Context
Reinventing Business Models
Flipping the Headquarters Paradigm
Building Diverse Leadership Teams
Developing Global Intelligence (GQ)
Adaptability
Awareness
Curiosity
Empathy
Alignment
Collaboration
Integration
Increasing Your GQ
Emerging Global Leaders
David Thai, the Serial Entrepreneur
Tamara Rogers, the Traveler
Peilung Li, the Rebel
Rodrigo Mascarenhas, the Multiplier
Abby Falik, Developing Global Leaders
The Future for Global Leaders
Exercise: Developing GQ

Afterword: Stakeholders in Society
Jack Ma: China’s First Global Leader
The Purpose of Business
Becoming Stakeholders in Society
New Leaders Featured in Discover Your True North
Participants from the Original Research for True North
Where Are They Now?
References
Preface
Introduction
Chapter 1
Chapter 2
Chapter 3
Chapter 4
Chapter 5
Chapter 6
Chapter 7
Chapter 8
Chapter 9
Chapter 10
Chapter 11
Chapter 12
Afterword
About the Author
Acknowledgments
Index
End User License Agreement