Leaders who fail to increase their sophistication as their company grows are in peril of being left behind.
Many leaders have had that moment when they realize they are no longer leading the charge but are instead watching their business surge ahead of them. This is what YPO Member John Hillen and Mark D. Nevins, co-authors of the new book “What Happens Now: Reinvent Yourself as a Leader Before Your Business Outruns You,” call a stall.
Hillen and Nevins define seven types of stalls — purpose, teamwork, stakeholders, leading change, authority, focus and leadership development — and help leaders recognize when they are in a stall, assess and troubleshoot it, and recover through reinvention.
Hillen recently offered some thoughts for business leaders on stalls and how to return to the head of the pack.
Is there an overarching reason leaders stall?
When an organization grows, two challenges arise for the leader: increased complexity and a need for greater sophistication, the latter of which is a difference in kind, not in scale. In general, most leaders do a good job of addressing complexity — they have tools for that — but increasing their sophistication is a bigger challenge. They excel at tackling new business complexity to keep growing the organization, but they neglect to apply that same degree of deliberation to increasing their ability as a leader to run the new organization at the next level. They focus on changing the business rather than reinventing themselves.
Why are most leaders better equipped to handle complexity over sophistication?
It starts with the way business leaders are educated — and I say this as a professor in a business school. A few years ago, I read a great article in “Harvard Business Review” about how business schools lost their way by spending most of their time training students to do the science of leadership (methodology, analytics) while neglecting to teach them how to lead in the very human environment in which business takes place. Leadership is not exercised inside a formula! It takes place in inchoate, inexact, sometimes confusing situations full of emotion and unusual behavior. Leaders seldom have all the time and information they need to make the “perfect” decision. They need to learn to understand the nature of achieving through others in a thoroughly human enterprise — which is the one characteristic that every organization has in common.
Which is the most common of the seven stalls?
Relatively new leaders tend to experience stalls in purpose, leading change and teamwork because those are the kinds of challenges facing them at that point in their career.
Ultimately, the most important stall — and the most useful to growing a company if it is recognized and addressed — deals with what we consider the highest art of leadership: developing leaders. It is common for leaders to be so consumed by running the company of today, they fail to take time to build the team that will lead the company of tomorrow. Leaders must become comfortable letting others accomplish objectives, so they can become leaders too. Failure to do so can stop an enterprise in its tracks.
Why should a leader categorize the organization’s stakeholders?
It is all about knowing where to most profitably spend time and energy. Leaders need to shift from only managing what we call down and in constituencies (staff, vendors, contractors, etc.), to up and out stakeholders (shareholders, investors, media, analysts, future customers, etc.) — that is, from people they can control to people they cannot control. This requires a different skill set and they are often not trained for it.
Why do you believe the CEO should act as the chief explaining officer, the chief values officer and the chief philosophy officer?
Simply put, because people expect it. If you are the leader of a company that is experiencing ethical or philosophical issues, who do people look to for clarification? Leaders own the organization’s culture, philosophy and value system and they must be able to explain them. For example, after the Target data breach a few years ago, the CEO chose not to go to the U.S. Senate Committee on the Judiciary during its hearing on privacy in the digital age to explain how the breach happened and instead sent the CFO. Two weeks later, the board fired the CEO and put the CFO in the top spot. As Mark Zuckerberg recently found out, if you are the leader, you cannot delegate philosophy, ethics or values.
What mistake do leaders often make when they realize they are in a stall?
They double down on the skills that made them successful. They think, “Something is not working, so I need to work harder.” What they really need to do is reinvent themselves and acquire a new mindset and behaviors.
The keys are self-awareness and self-reflection. Leaders need to understand that it is okay to be vulnerable and wonder if they have what it takes. I suggest asking your employees how things are going in their area, what you need to do differently and what else they need from you. Do not fear that these are indications of weakness; on the contrary, they are the actions of a confident leader.