Leadership Quote

Most people who want to get ahead do it backward. They think, ‘I’ll get a bigger job, then I’ll learn how to be a leader.’ But showing leadership skill is how you get the bigger job in the first place. Leadership isn’t a position, it’s a process. — John Maxwell

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Shift: Strategic Reinvention

Steve Ballmer has a new lease on life. After more than three decades at Microsoft as employee number 30, he retired as CEO in February 2014 and is looking toward the future. He’s also number 18 on Forbes’ list of wealthiest Americans with $22.5 billion, so he discussed his plans for the future with George Anders for that magazine’s recent issue.

First, Ballmer’s purchase of the Los Angeles Clippers earlier this year will take a large chunk of his time. This was the third time he tried to purchase an NBA team. Many believe he overpaid for the opportunity, but it aligns well with his love of the sport, and focuses him in an entirely different direction. Second, though he’s no longer involved with the company, as the largest individual Microsoft shareholder (333 million shares!), he will continue to closely monitor his investment. He’s also using his vast experience to teach MBA students at the Stanford Graduate School of Business. This is part of evaluating his legacy as they analyze the successes and failures of his former company.

ShiftFinally, and more importantly, he and his wife are researching how to use their formidable wealth to positively impact society through philanthropy. He’s surrounding himself with a group of advisors to understand issues and problems around the world as he formulates his next steps in this arena. Ballmer’s legendary energy level, evidenced whenever he met with employees at Microsoft, and with Clippers fans at his first game as owner, seems at an all-time high as looks toward the future. He’s making a shift and strategically reinventing himself.

Organizational Reinvention

Ballmer’s exit from Microsoft came at a time when investors were calling for change. Given the pressures on new product development and revenues, it was time for a shift in the company. He had reached a senior level of professional maturity and accomplishment, and it was time to look for the next shift in his own life. But Ballmer is just one example of the many people who reach that point. Granted 99.99% of the people aren’t quite as rich or accomplished, but nonetheless are similarly passionate about their past and their future, and find a time in life where they need a shift…a strategic reinvention.


IBM is facing a similar pivotal moment. In their 2014 third quarter earnings release, CEO Virginia Rometty acknowledged a need to reinvent the company just twenty years after their strategic shift from hardware, to software and computer services. Now after revenues have declined for the 10th straight quarter, those business lines are lagging and the company is admitting they will miss an earnings target. Some describe it as an “old technology company” that needs to quickly move into cloud computing. And while opinions may vary, they are obviously in need of a shift…a strategic reinvention.

Getting There

Making a shift or strategic reinvention is characterized by several phases.

Discomfort – When individual or organizational results are no longer as favorable, and the tried and true strategies to improve them don’t work, this is a warning signal. There may be an uneasiness that the environment is changing, stakeholders want different outcomes, and competitive requirements are fluctuating. The ability to develop plans to meet future needs becomes more difficult as the environment lacks clarity. This is like shifting gears in a vehicle with an automatic transmission where there’s a momentary pause in the speed of the vehicle, but the ultimate benefit is that it can move faster once the shifting is complete.

Direction – Strategic reinvention requires thoughtful evaluation of where you want to go, what you want to become, and whether you have the resources to get there. It requires careful assessment of the competitive environment, the financial requirements, the skillset of your team, the time required for change, and future perspective. This requires a level of resolve by the leader(s) to make tough decisions unencumbered by the past, to head in the right direction.

Destination – After a strategic reinvention, where you end up will look different from where you were. The people who were with you in the past, may not follow you into the future because they don’t want to, or are not capable of making the shift; they’re not invested in the change. Your destination can represent a fresh start, a new beginning, a different approach to how you add value to others. It’s important to take advantage of the momentum you gather along the way and carefully construct the environment crucial to your success.

Winds of Change

Former Intel CEO Andy Grove’s book, Only the Paranoid Survive, makes the point that we all need to expose ourselves to the winds of change. These winds at some point will require us to shift gears, and experience a strategic reinvention, so that we can move further faster. It’s rarely easy.  Often a coach, advisor or consultant with specific expertise in the area of focus can help to guide you on the pathway, to help as you shift gears. Steve Ballmer seems to be finding his pace and enjoying the process. Microsoft, IBM and other organizations similarly positioned will be pushed forward by less patient stakeholders. Ultimately all of us will reach a point where we need to shift. How will you handle it?

Read the Forbes story on Steve Ballmer here.

Read the Wall Street Journal story on IBM here.

 

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Passion: Blinded or Balanced?

Ann Marie Sastry has a big idea. With over 70 patents and 80 scientific publications to her credit, she describes herself as a “happy warrior who’s driven by doing the next new thing.” That drive leads her to put in 100 hour work weeks and spend over two decades in pursuit of developing new battery technology application for use in electric vehicles. She’s scrapped the traditional chemical lithium technology to rethink the basics of energy, power, mass, volume, cost and safety, all in search of a new approach. She’s also raised $30 million from a variety of backers in support of her grand idea.

Sastry has an entrepreneurial zeal for her product that compels her to pursue any and every approach and perspective to accomplish her goal. She has a passion and optimism for success that propels her forward, and expects that within a year or two her product will be in full production. But for every successful entrepreneur, there are many more whose dreams never turn into reality. That’s because the same passion that propels her forward with a clear focus on success, can be blinding to others and cause them to miss the obvious cues that unfortunately their grand idea won’t get off the ground.

Passion-Blinded (200x145)A recent article in the Wall Street Journal on How an Entrepreneur’s Zeal Can Destroy a Startup by Noam Wasserman provides perspective on the negative effects of such passion. It’s displayed in the many mistakes founders make in starting their business including lack of technical or scientific experience, management experience, and connections with investors and potential customers. They significantly underestimate the time and resources needed to get the business running, and the toll it will take on their family relationships.

Interestingly, one study showed that when 800 founders’ startup ideas were assessed and given feedback on the feasibility and next steps of their business, of those who received a recommendation that their ideas wasn’t commercially viable, 29% continued to invest money, and 51% continued to invest time in developing their ideas. The obvious question at this point is why someone would continue to pursue a venture when they’re highly unlikely to succeed. The authors suggest that these individuals had overwhelming optimism in their potential for success, coupled with a reluctance to give up after already investing so much time and money. In short, they were blinded by their passion.


Founders are often driven by a desire to make a mark in their world. They believe that their idea will play an important role in their environment or society, and feel compelled to pursue it. Their passion becomes the focal point of their thought process as they guide their lives to accomplish their dream. Passion managed appropriately can have a positive impact; while unchecked and unbalanced passion may lead to negative behaviors and consequences. Passion for an initiative can open one’s eyes to new possibilities, but it can also blind one to the potential difficulties of pursuing it. Passion can drive entrepreneurs to sacrifice the presumed comfort of a steady paycheck to pursue their business startups, but it can also put their finances, families and future at risk.

Thus, too much of a good thing can become a bad thing. So how do know if your passion is out of balance?

Do you have the support of your family? Or are you sacrificing too much time with your family to pursue your passion? Is your significant other supportive, or asking you to redirect your time and energy? Many entrepreneurs fail to be honest with themselves and their loved ones about the commitment required to pursue their dream.
Do you have the resources to support it? Do you have sufficient finances for your personal living expenses? Are you draining your retirement savings? How are you funding this venture, and how much are you willing to invest and borrow to determine if it has a chance of success?
Does it help build positive relationships? Or, do your friends and colleagues avoid you because this is the only thing you talk about? Engaging in conversations on a variety of topics with individuals from various backgrounds can serve as a creative catalyst, versus being singularly focused on your project.
Do you have the skillset to accomplish it? Or are you able to gather others around you with the right skillset to support your efforts? Too many entrepreneurs try to do it all when in reality they need to surround themselves with a people who possess a variety of skillsets and needs that will evolve over time.
Does it meet a need, fill a void, or satisfy a desire in the marketplace? What may seem like a wonderful idea to you, may lack sufficient value to others. Are people really willing to invest in it or pay for it?

If you responded “no” to any of these primary questions, this is the time to think carefully about what you’re doing and find a way to balance your passion. This is the time to make sure your zeal is not overshadowing reality, and focus on initiatives where you CAN be successful, where you CAN fulfill your responsibilities to family and friends, where your talents CAN be most valued.

Never give up on your passion. Simply maximize it and apply it where it will be most beneficial. Whether your passion is focused on an entrepreneurial venture, a great new idea for a process or product within your organization, a pastime or hobby, or a business initiative, balance is the key.

Read more about Ann Marie Sastry in Fortune here
Read the article by Noam Wasserman here

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The Mighty Ones

The applause was deafening. The congratulations overwhelmed your email box. The press clippings were glowing.  Everyone was buzzing, because your recent product launch was successful. Last quarter’s earnings beat even the analysts’ predictions.  The company’s stock price was up 15%. Operating costs were down, and sales volumes were number one in the industry.

So how do you follow that act? All of this excitement doesn’t build a platform upon which to rest. Instead it forms a bar, higher than the last one, over which you must hurdle. After all, the stockholders expect more earnings. Customers expect better products. Employees expect more career opportunity. And so it goes. How do you manage all of these expectations for continuous improvement against the best strategy for the company’s growth? How do you compete for market dominance without succumbing to market vulnerabilities?

Mighty Ones (200x133)This is the pivotal point. The choices you make will become either a stepping stone to greater success, or the rock that trips up your company, your team, or your own leadership success. Companies and people don’t automatically enter a “safe” zone when they reach a measure of accomplishment. But in some cases, their behavior suggests that they think their momentum can’t be stopped.

You’ve heard the saying, “the higher you climb, the harder you fall.”  While that doesn’t necessarily have to be the case, in the midst of success, it’s important to remain grounded; like holding onto a guardrail.


Jim Collins, author of the best-selling books Good to Great and Built to Last, provides an explanation on how once-mighty companies fall. He highlights five stages in his book How the Mighty Fall: And Why Some Companies Never Give In.

  1. Hubris born of success. Here an organization or team exhibits extreme pride and arrogance based on past accomplishments.
  2. Undisciplined pursuit of more.  Companies in this stage overreach, become obsessed with growth, and fail to manage the process and pace effectively, ultimately undermining their long-term value.
  3. Denial of risk and peril. By this stage, companies are so caught up in successes that they become blind to the possibilities of failure.
  4. Grasping for salvation. This is the moment where the company’s decisions lead to new life or certain death.
  5.  Capitulation to irrelevance or death. At this point organizations are spiraling out of control and either give in to certain death, or shrink into irrelevance.

So how does one avoid this death spiral, whether within your team, your organization or for your own leadership abilities? Here are a few tips from my playbook.

  1. Build a culture of humility. Keep the focus on the value you provide to your customers; and the “why” of your organization. What’s the impact if you cease to exist? It’s really not all about your company. It’s about the value you provide to others. This is a giving mentality, where long term relationships, integrity and quality products or services are most important; instead of a getting mentality, where there’s constant pressure on the customer to buy.
  2. Find your truth teller. Unfortunately, some leaders surround themselves with other leaders who will tell them what they want to hear. Or they don’t create a culture where their team feels comfortable fully informing them about business issues. Make sure you surround yourself with people who are encouraged and willing to speak up and say the difficult things or raise questions that may be contrary to the prevailing direction.
  3. Strike your balance. If you try to be all things to all customers; if you overreach in too many different directions, you lose your balance and end up grasping for a lifeline. A tightrope walker is constantly shifting his weight to keep his center of mass above his feet. This alignment is critical in your organization or team to ensure stability between competing priorities.
  4. Exhibit learning leadership. Only when the leader of the team demonstrates a continual desire to learn, to admit faults and deficiencies, and to seek input from the entire team and others outside the company, will others in the organization follow suit.
  5. Master discipline. Establish a system that produces results, and keep repeating it.  Measure the right factors. Ensure team members are learning agile and will support the culture. Focus on a consistent vision. Stick to what works.

Note that these recommendations have nothing to do with functional or technical skills. You can hire individuals on your team to fulfill those roles. This has everything to do with pure leadership; influencing others to move forward in the right direction, based on the right decisions. These are important steps in building a “mighty” organization. So, are you a “mighty” leader?

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