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When it comes to defining and achieving transformational leadership, opinions and studies abound. Much of it, unfortunately, ranges from the intensely academic to the blanched corporate boilerplate.
In this post, I aim to bring you a fresh look at this timely topic—including relevant examples and breakthrough approaches to obstacles that may be standing in your way on your own journey to being a better leader.
But first, let’s warm up with a few lighthearted examples of other famous leadership styles.
1. Autocratic Leadership.
Could also be called dictatorial. Strives for total control. Napoleon or any of the great oppressors exemplify this approach.
2. Servant Leadership.
The total flipside of autocratic. This leader puts their people above all else. Gandhi and Martin Luther King come to mind.
3. Command And Control Leadership.
Bureaucratic is another word for this style. Following the rules matter above all else. A great example would be the Roman Senate during the height of the empire; or maybe your grandparents.
4. Transactional Leadership.
Status quo much? This style goes all in to maintain the current company structure and its functionality. Get on board, or get out. Bill Gates was famous for this approach.
Okay, now that we’re in leadership mode, let’s dive in.
How To Spot A Transformational Leader.
- They lead by example.
- They possess the necessary vision to identify when the status quo no longer works.
- They’re capable of persuading, motivating and organising their followers toward their vision.
Steve Jobs and Richard Branson are obvious popular examples.
Their leadership style evokes a visceral response from the observer or recipient akin to sheer inspiration.
It’s the equal, yet opposite, gut reaction we all felt when confronted with the failings of Travis Kalanick, Oscar Munoz, John Stumpf and other CEOs in the last year or so who, despite some measure of brilliance, managed to damage their company’s brand and create cultural toxicity.
Transparency Is Vital.
Countless companies want to transform. Yet how many leaders can lay claim to this achievement?
QSuper’s pension funds for Queensland’s government employees may not be as sexy as the original iPhone launch. But Michael Pennisi, CEO of QSuper, approached the needed changes with a Jobs-era Apple flair.
Two years ago, QSuper was one of the few remaining closed public-sectors pension funds in Australia.
So when, in that same year, the Queensland government legislated an open market, Pennisi had been preparing. (From our definition: the necessary vision to identify when the status quo no longer works).
This meant a complete revamp of their business model. To activate the transformation, Pennisi introduced two major shifts.
- First, a streamlining of operations coupled with single-point accountability across the business.
- Second, one group of people came together to oversee all the changes company-wide for consistency. Focused on five key priorities, they put all other work on hold.
Pennisi’s message to his executive team: “You’ve got a mandate. Here are the expectations. I’ll leave you to run with it.” (From our definition: Capable of persuading, motivating and organising their followers toward their vision).
Transparency was integral to the transformation.
Pennisi conducted regular town hall meetings with all employees completely unscripted and unrehearsed. Anyone could ask anything.
The message to everyone was clear—they were all in it together. (Final point from our definition: Lead by example).
Characteristics Of Transformational CEOs.
Now let’s go broader. Last year, HBR released a study called the Transformation 10.
Even though they looked at the traditional group of S&P 500 and Global 500 firms, their measurements were far from expected.
Rather than relying upon generic metrics (like innovation, or profit margin), they dug deep into which leaders could strategically reposition their companies…and why.
While the entire study is worth a read, these two characteristics of transformational CEOs are the most revelatory:
1. They’re On Two Separate Strategic Journeys.
A keen insight from the study is that transformation can’t occur when a leader pursues one linear journey during which the old company is expected to evolve into a new one.
Instead, the recommended dual journey is one of repositioning the core business while actively pursuing new ones. Amazon is a great example.
(Related Article: Ethical Issues In Business: Are CEOs Becoming Less Ethical?)
Having expanded its core retailing platform into new categories like food and streaming content, its parallel journey was building the world’s largest cloud computing enterprise.
CEO Andy Jassy of Amazon Web Services (AWS) began this work in 2006. Since then, his efforts have quelled a long-standing analyst complaint about Amazon—namely that its central offerings were scarcely profitable.
Today, while AWS makes up a mere 10% of Amazon’s $150 billion in revenue, it generates almost 89% of the company’s $1 billion quarterly operating profit.
2. They Plan For Disruption.
The two-pronged transformation journey takes time. According to the study, at least 10 years.
And, if you’re not vigilant, you can still be knocked off your feet more than a decade after you’ve begun. No one knows this better than Reed Hastings of Netflix:
“My greatest fear at Netflix has been that we wouldn’t make the leap from success in DVDs to success in streaming.”
So, he started planning early, back in 2007. Ironically, he moved too fast when five years later, Hastings attempted to launch Qwikster—a stand-alone mail-based DVD company.
Netflix customers weren’t ready for it. Hastings had to admit defeat and back off.
The answer was returning to the dual journey until it was time to make the leap. The end result is that Netflix is now in 100 million homes in 190 countries.
Although personally, I’m repeatedly disappointed that anything I want to watch is only on DVD, this broader question of timing raises one of the trickiest issues in the transformation game.
ROI Of Long-Term Planning.
Ari Wallach, Fast Company’s new expert on social and business trends, and self-proclaimed creator of “futuring,” has cultivated an approach that appears unorthodox in today’s business climate of constant change.
Wallach, who has strategised for clients as diverse as Obama and Deepak Chopra, laments that when he began his consulting work more than a decade ago, corporate leaders used to talk, think and plan in longer chunks of time.
Five, ten even 20 years out.
But today, when Wallach meets with corporate leaders, they say “Hey, I love your work. Now let’s talk about the next six months.”
In one of his insightful Ted Talks, he cautions against relying upon sandbag strategies and falling prey to a syndrome he’s deemed “short-termism.”
Short-termism, Wallach claims, is a backlash of technology. We want and expect everything instantly. It’s a syndrome Wallach cautions is making us hyper-reactionary.
In an age when change is coming at leaders (and at everyone) faster than most humans can productively process, what does he recommend? An approach Wallach has coined as the Longpath Practice.
Note that he calls it out as a practice, meaning its success requires our committed active involvement repeatedly in the present moment.
Three Pillars Of Longpath.
1. Transgenerational Thinking.
What impact will your business have long after your own cycle of birth and death? What is your legacy to society?
2. Futures – Not Future.
Open up your point of view beyond the dominant lens of your time (technology).
Create a new point of view for yourself, and your business. What other futures—beyond the obvious—can your business foster?
3. Telos Thinking.
In Greek, telos means “ultimate aim” or “ultimate purpose.” Telos thinking invites us to answer the question: To what end?
- What will be different by taking this step, changing this policy, or shifting this approach?
- What will come after? And not just a year from now or even five years from now.
- What will have happened 20, 50, or 100 years from now because we made this choice today?
- In other words, to what end are you doing what you are doing?
Can you hold a vision that stretches far beyond your lifespan? Before you dismiss this approach to transformational leadership as too laborious, consider this example…
Not the tip of South America, the corporation. Yvon Chouinard, Patagonia’s founder, on NPR’s “How I Built This” podcast said:
“The faster a business grows, the faster it dies. We decided on a growth program so that we would be around 100 years from now. So all decisions were made as if we’re going to be around 100 years from now.”
Again, 100 years. And for Chouinard, his reasoning is similar to Wallach’s.
“We slowed down our growth, said ‘No’ to a lot of opportunities and became more responsible.”
No surprise then that Chouinard’s “to what end” is advocating for the environment, helping to prevent global warming and donating to causes that align with this vision.
Imagine how different a company Patagonia would be today if he had only focused on the next six months. Or even the next five years.
Don’t get me wrong. I’m not proposing that you scrap your short- and medium-term plans.
But powerful transformation happens when you take a huge step back and widen your scope. Daily issues seem a lot less pressing when considered in the bigger picture.
Two Challenges For You.
The next time you’re feeling backed into a corner by a risky short-term dilemma, ask yourself:
- Will delaying this decision/launch affect the future of your business 100, 10 or even five years from now? If the answer is no, back away. It becomes easier to lead without the distraction of a minor setback. And to course correct if you’re not expending your precious energy on a short-term stressor.
- How can you simplify your company’s mission? What basic statement embodies your very purpose for doing your business? When you think about the next century, platitudes and business jargon seem to land where they belong—in the waste bin.
I’ll End Today’s Post With An Inspirational Tale.
It was impossible to say no to President Mandela.
As the stories go, Mandela was endeavouring to convince a local corporate executive to donate to the restoration of a football field in the Eastern Cape devastated by flooding.
The executive made the trip with Mandela, but with a firm financial figure in mind that he was determined not to deviate from.
When the helicopter landed at the football field, tens of thousands of black school children in sparkling white shirts bowed to welcome their leader.
Again, as the stories go, Mandela turned to the executive and said, “Now, I hope you are not going to disappoint me?”
In that split second, the executive mentally vowed to double the amount of his donation. After everything Mandela had sacrificed, how could he possibly hold back?
And so, we’ll add one last example bullet point to our working definition for today: Generosity.
Give of yourself and transformation will follow. You are the first, and most important, example of transformational leadership.