Re: What do you do?

Description: Leadership is about fidelity to your life story.

Question: Beyond a simple title, how would you describe what you do for a living?

Transcript: Well I’m a business person that’s now gone into academia. I was in business for 32 years with three major companies, the last of which was Medtronic where I was the Chairman and CEO, and there for a total of 13 years. And I intentionally capped my time as CEO to 10 years, because I wanted to do some other things in life. And I got to . . . I took a working sabbatical, went to Switzerland, taught at two institutions there – a business school IMD and a federal polytechnic – and I got fascinated with teaching and writing, and then came back to my alma mater at Harvard after a short stop at Yale. And since that time, I’ve developed a deep passion in the last five years in trying to have an impact on the future generation of business and non-profit leaders. And the two books I’ve written have been on that subject, most recently the “True North” is aimed at trying to show people of all ages how they can develop into authentic leaders. And that’s what my real passion is these days.

Question: What about leadership interested you?

Transcript: Well I feel like we’ve had so many bad leaders who have destroyed great institutions. I believe in building great institutions. And I get very angry at my generation of leaders that has really failed in many, many ways. I’m speaking of the people that are now let’s say 60 and above. When I was a teenager, I had this idea of having the opportunity to lead a major company, but also set a standard for others on how an ethically-based, value-centered company could be more effective. And I certainly think we did that at Medtronic; but I would have to say I had very little influence on the leaders of my generation. And during the crises in leadership that’s emerged since the fall of Enron with Worldcom, Tyco. But really far beyond that, hundreds of companies and literally thousands of leaders who have failed because they put themselves before their institutions. I have decided to devote the next 10 years of my life to try to have some impact on the up and coming leaders – all the way from the new CEOs to young people coming out of college and graduate school today.

Question: What is the difference between management and leadership?

Transcript: Well I think management are the skills of how you do things. Leadership is really the ability to empower people . . . to align people around a common mission and values; to set standards of what you want to be and what you want an organization to become; and then to empower other people to step up and lead. It’s not about leaders and followers like we used to think. Leaders are not people who get people to follow them. It’s people who inspire other people to lead. And leadership is about service, whether your customers or your students, if you want it in an academic sense. And a certainly the employees who work with you and people that are your owners; but I think it’s really more about service. I mean we’ve had so many leaders who saw themselves more as takers than givers, and I think we need leaders who are givers. And that’s the influence I’m trying to have.

Question: What is good leadership?

Transcript: From my new book “True North”, I interviewed 125 leaders who are authentic leader. And I think you can’t be a good leader unless you can be the authentic person you were meant to be. And too much of our leadership development in the ‘70s and ‘80s and even ‘90s was focused too much on trying to make you into a standard leader to emulate other great leaders; or to be a charismatic leader; or to fit a certain set of traits and characteristics. And what we learned, and what I’ve learned is leadership is not about any of those things. It’s about being who you are and having integrity in everything you do; and empowering the other people around a common belief set. And if you can do that, you can lead. And I think it doesn’t matter how old you are or how young you are. You can become that leader. And that’s the message I’ve been trying to communicate to people.

Question: Can leadership be taught?

Transcript: Well I don’t think you can really teach leadership. I think you can learn leadership. In my classrooms at Harvard Business School, for instance, we believe not in knowledge transfer – as in from the professor to the student – but more knowledge exchange where people are sharing their leadership experiences; studying what other leaders did; saying “What would I do if I were in that situation”; and exchanging ideas about leadership – and particularly where they have failed, or where they have faced crises, or where they faced difficult times, which we call “crucibles”. That’s where the real learning comes from. And it’s the magic of the classroom – the dialogue – that I find so precious and such a great learning opportunity.

Question: How can business leadership be a force of change?

Transcript: Well I think it should be, but it certainly hasn’t been. I think all too often, business leaders have been in there to take as much as they can get for themselves or for their organization, rather than recognizing the greater good; and that the only reason for business existing in our society is if it makes a contribution to the societal good. We have no other basis for existing. And I was on the board of a French company once when the socialist government of Francois _______ came in and immediately nationalized the company, which was Bull – the computer company, on which I was serving on the Board. And that . . . From a French sense, the company had no right to exist. And we saw here in the United States, Sarbanes-Oxley came in to limit the powers of business leaders because they took advantage of the system. And so I think business has a deep responsibility to realize how it contributes to society. And at Medtronic, we were very cognizant of the fact that we were storing seven or eight million people every year to full life in ______. And if we produced a low quality product, we had failed at what we were doing; but if we did that well, we made a great contribution to human life. And I think each organization in its own way – maybe not saving lives – but contributes to society if they do it well. And if they don’t they’ll go out of business. They won’t exist anymore.

Question: Who are some great leaders in business today?

Transcript: You know honestly, I am very optimistic about the current generation of what I call the post-Enron CEOs. People like Jeff Immelt at General Electric, and Andrea Jung at AVON products, Anne Mulcahy at Xerox. We have some great leaders coming up. Sam Palmisano at IBM, A.G. Lafley at Proctor & Gamble. And many, many leaders of smaller companies like the leaders at Google and a lot of the startup companies. And Howard Schultz at Starbucks. There’s just a great new generation of leaders. You know why? Because they realize how so many of my generation did it wrong. And you can almost characterize my generation as the unilateralist leaders who, “We’re going to do it our way.” And the new generation realizes we have to be collaborative leaders. We have to collaborate within, and we also have to collaborate with other institutions – either other businesses, governments, or non-profit organizations. So instead of fighting against those organizations, the wise organizations are now finding ways to bond with them to accomplish greater societal needs.

Question: Are leaders born or made?

Transcript: You know having studied leaders most of my life, and having formally done it through this research, I think it’s really not a question of whether leaders are made or born. I think because we’re all born with the gifts of leadership – but each of us is unique – there’s no standard set; but we have to develop those gifts. Just if like you were a great musician, or you wanted to be a great musician and you want to go to Carnegie Hall, you’d practice your . . . using your gifts every day. The same with great athletes. I think it’s no different with leaders. Leaders have to develop themselves as leaders. And our study of leaders, every single leader who has failed that I’ve studied, failed to lead themselves. And so if we could help people develop themselves – leadership from within rather than just leadership from without – they can become great leaders, but using the gifts they have. If they try to emulate someone else’s gifts, they will fail without question.

Question: What makes a great leader?

Transcript: You know for too long, we’ve been studying the characteristics and traits of great leadership, and I could reel off a list of 10 or 25 traits or characteristics. But every great leader that I could name would miss some of those traits. And there may be people that have all those traits that are maybe not great leaders. So I . . . what I learned from the 125 leaders I interviewed, and from my own personal experience in working with literally hundreds of leaders, it’s not about traits or characteristics. It’s about your life story, and it’s about fidelity to your life’s story – who you are. Because you have certain tapes running through your head about say, “Who am I in this world? What are my passions? What do I want to do?” And out of that comes your capacity for leadership. And we’ve just seen time after time leaders be inspired by their own stories, by their own difficulties, by their own crucibles. Oprah Winfrey talks about the abuse she encountered as a young girl. But it wasn’t until she was 36 that she was able to frame and see this. That gave her inspiration to say, you know, what my show is all about is empowering people to take responsibility for their lives. Howard Schultz talked about wanting to create a company in Starbucks that his father never had a chance to work at . . . that his father would be proud to work at. And that’s why he gave healthcare to all his workers because he wanted it to be a great place to work, and through that create a relationship between the customers and the employees. And so through their life stories, we’ve found . . . almost every leader found their inspiration to lead. And that’s what empowered them to become great leaders.

Question: What are some of the most exciting things going on in business today?

Transcript: Well there’s a tremendous amount of exciting things going on in business. I think the breakthroughs in healthcare that I participated in, and what can be done to improve human health; the contributions of technology to many of our businesses, and making them competitive on a global scale. But I would say of all the things, the thing that I’m most excited about is the emergence of great global corporations – companies that can operate anywhere in the globe and take advantage of the best skills anywhere. So I’m not a believer in the criticism outsourcing of those things. I think if we could blend together in a multicultural sense people of all kinds of ethnic backgrounds, religious backgrounds, racial backgrounds, gender and have that kind of unit, we can . . . an organization can make contributions through tough global problems – whether it’s global poverty, economic self-sufficiency . . . I’m a great believer in capitalism. I was a fervent capitalist, and I think the capitalistic model can work if we can be a collaborative capitalism; but what Narayana Murphy of InfoSys calls compassionate capitalism – one that emphasizes fairness, decency, transparency and honesty. But that can be blended in with the principles of capitalism, then I think you have the benefit for using capitalism to create a better society. However there’s a downside to capitalism. And capitalism run amuck can create damage and great harm to people. And that’s why we need authentic leaders running our organizations, not people that are in it for themselves.

Question: What are the drawbacks of capitalism?

Transcript: Well certainly when people are in there to take for themselves and are not concerned about the long-term histories of the institutions, they become totally focused on satisfying Wall Street – the quarterly earnings – and they wind up destroying companies. But they can’t think beyond Detroit, Michigan and these great automobile companies of the past that were the _______ of the American economy are going away. So it can operate in the United States. Why can’t General Motors? I think it’s been a real tragedy that people have been so short-sighted in their orientation and not look for the long term. How do you build an organization that can really contribute to society, not contribute to us as leaders. We recently saw the CEO of Home Depot take $210 million of the company for failing. Now that’s not capitalism; that’s capitalism run amuck. And too often compensation is paid to people not for success, but for failure. And that’s just wrong. Boards of directors who do that should be let go; should be turned down and we should get a new board of directors. And we’ve seen it obviously in the cases of the Enrons of the world where people actually corrupt in the way that the system . . . But beyond that, the law takes care of people like that. I’m much more concerned with the hundreds of CEOs that capitulated and played the short-term Wall Street game and destroyed their companies. They stopped investing in R&D. They stopped investing in people. They stopped investing in technology, and they wind up without a business. And they’re out of business now.

Recorded on: 7/6/07