Leadership

by Michele Milan

As the CEO of Rotman Executive Programs, Michele Milan is up-to-date on the latest theories and best practices for being an effective leader. She shares some of her insights on what it takes to be a great leader in the current business landscape. 

Strong Ethical Foundation 
Leadership is more difficult than ever. We are in a period when trust in leaders and our institutions has been eroded.  Society is demanding and deserves leaders who are moral and ethical.  Leaders with character.  Authentic leadership means speaking and doing from a centre of moral conviction.  It is personal integrity that cultivates credibility and trust. I also believe this is key to finding real meaning in one’s work, and enabling employees to do likewise - to find their work meaningful and really believe they are contributing to something worthwhile. This is important not only for individuals, and not only as a driver of productivity, but for society as a whole.  Businesses have a huge impact on the world around them. A strong ethical foundation in an organization means it will contribute to society in a way that sustains and enriches the lives of all. 

Ability to Communicate
It is still true that a good leader has the ability to envision her organization’s future, and to clearly communicate that vision. Clear and straightforward communication allows everyone to understand their individual roles, in making decisions in line with strategy and moving the organization forward. But good communication is two-way and goes beyond formal occasions. In our more collaborative work environments, with rapidly changing demographics, leaders really need to listen and they need to seek to understand what is really going on. I personally meet with everyone in the organization at least once a year and speak with as many clients as possible. Seeking understanding is critical, but can be difficult because the signal-to-noise ratio can be really high. We are all dealing with vast amounts of information. It can be overwhelming. Leaders now need to communicate constantly to translate complexity and to keep people aligned as the pace of change continues to accelerate. Tuning in to and maintaining awareness of informal networks and channels of communication is crucial for a leader since it is these systems that often determine what really goes on in an organization. 

Strategic Agility
Creating and maintaining a path for advancing an organization’s agenda in a rapidly changing environment requires strategic agility on the part of a leader, both to synthesize and assess vast amounts of information, and to readjust as necessary. This means responding to new circumstances, research and technology in real time. The pace of change is incredible. Leaders must constantly fine-tune their strategy to keep their organizations agile. Clear, two-way communication about changing circumstances and strategy allows employees to respond and realign their own initiatives and roles.

Self-awareness
Self-awareness, self-regulation and a habit of self-reflection are essential for a leader’s personal effectiveness; they also determine the tone a leader sets for her organization. A leader must be able to manage her own emotional reactions, and to understand the effect she has on others, both personally and in terms of the organization’s power structure. There are many techniques for developing greater self-awareness and the ability to self-regulate. My personal favourites are journaling and mindfulness meditation.

Good Practices and Habits
Effective leadership occurs not just in grand moments, but in daily hourly habits. In addition to a practice of reflection, habits of learning and self-care are critical.  Habitually seeking learning prepares a leader for rapid change. Leading also takes a tremendous amount of energy and stamina; a good leader must create habits that foster resilience, practices that recharge and replenish her resources in order to maintain health and well-being. Of course, this is true of everyone in the organization as well and supporting the health and wellness of employees makes the whole organization more resilient and productive.

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As the CEO of Rotman Executive Programs, Michele Milan is up-to-date on the latest theories and best practices for being an effective leader. She shares some of her insights on what it takes to be a great leader in the current business landscape. To learn more about Rotman's leadership programs visit: www.rotmanexecutive.com

7 Tough Leadership Lessons From A Navy SEAL Commander

Taking tactics from the war room to the boardroom.

As corporate leaders explore how to elevate the effectiveness and professional excellence of their working teams, there is a lot to be learned from Special Ops.

Their collaboration with other branches of the military over the past decade makes them an area of the military that both corporate America and the government can learn a lot from. I've been a longtime fan of the Navy SEALs, and in my constant search for inspiration to implement work culture and leadership change, I felt they could be a superb group to learn from. While this highly secretive branch of the military keeps themselves, and their secrets, to themselves, books like Lone Survivor and The Hunt for Bin Laden give us a look into how they operate. But nothing beats sitting down with a Navy SEAL commander to understand how they think about leadership.

Corporate and military leadership are distinctively different for obvious reasons: The military’s leadership is focused on leading organizations responsible for our country’s security and fighting wars, while business leaders are focused on creating value and protecting the interests of their stakeholders, with profit and return on investment often being the top priorities.

Meticulous planning
From a management standpoint, one of the greatest lessons that can be learned from Navy SEALs is their skill of being highly effective and meticulous planners. They focus on the importance of time management, on-target execution, and completing the mission. They operate with a backup and contingency plan in place for almost every scenario. One of the most practical skills taught in this branch is clear and direct communication. Most people think that the military teaches direct, one-way communication--but what’s less obvious to nonmilitary folks is the importance SEALs place on listening. SEAL Commanders listen and formulate an opinion that incorporates as many ideas and experiences as possible to form a solid plan. A big difference between Navy SEAL and civilian leadership is that once a commander’s decision is reached, the discussion is over—then full support and backing is given and a unified front is presented. Ultimate accountability rests on the commander’s shoulders.

Clear expectations
Navy SEALs focus on a very clear set of objectives, where significant importance is placed on defining the goal and motivating the team to follow. Even with highly complex operations, each SEAL has a clearly defined role, and expectations can be recited by each team member. Similarly, articulating a compelling vision and aligning people with priorities are vital areas in business, but these are often overlooked by many leaders. The SEAL’s rules of engagement (how they respond when confronted) are clearly established before each mission, and modifying these rules could negatively impact the entire operation. The rules of engagement for businesses (what is acceptable employee behavior and what is not) are very often ill-defined or nonexistent. One of the biggest disconnects we see in business is the gap between a company’s strategy and the aligned expectations set for the employees.

During a recent conversation with a SEAL commander, he offered tangible advice that can be applied to almost any business:

1. Teamwork is your top priority.
A mission cannot be successfully executed unless the team is functioning as one. The SEALs continual emphasis on teamwork corresponds closely with the daily requirements of the business world.

2. Early leaders are good leaders.
This opportunity is unparalleled in the corporate world, where an employee may need 10 to 15 years to reach a position of significant leadership and high level of responsibility.

3. Excel at ethics.
In the world of business, the ethical leader is sometimes a rarity, and truly esteemed.

4. Stay calm.
The military trains its team to be more comfortable taking risks with incomplete information. This is the daily function of a CEO, but it is rarely passed down to employees.

5. Hard times help you adapt--quickly.
Young executives who go through hard times should learn to appreciate them, recognizing that those times will not only strengthen them, but truly train them to properly and successfully lead their own teams when battling the competition.

6. Ambush the competition.
In an ambush, always take out the radio operator and the unit leader (usually the guy next to the radioman). Without leadership or good communication, the enemy is forced into disarray and can be picked apart. A good lesson for all leaders and their organizations.

7. Study Darwin.
Survival is not about who’s the strongest or fastest, but who can best adapt to change. Navy SEALs are masters of adaptation, being able to operate in jungle, desert, or artic conditions. In comparison, CEOs must adapt to the ever-changing market conditions they face daily and should train their staff to do the same.

Shawn Parr

A Simple Ethical Rule of Thumb: Would You Tell Your Kids?

Barry Schwartz

Professor of Psychology at Swarthmore College

Our shaky confidence in the ethical commitments of our corporate leaders seems to take a hit every week. Even though culprits rarely go to prison, firms have paid hundreds of millions to settle accusations in the last few years.

Lately, the issue has been insider trading. Goldman Sachs. SAC Capital Partners. Both were accused of several instances of insider trading. Sometimes, insider trading is blatant and clear cut. You find out at a board meeting that your firm is going to be bought for 30% per share above market value, so you call a deep-pocketed friend who buys ten million shares. It’s a no-brainer that this counts as insider trading.

But it isn’t always so clear. A few years ago, we were shocked by the disclosure that David L. Sokol, protégé of Warren Buffett, purchased shares in a company shortly before Buffett’s Berkshire Hathaway bought it. Buffet's announced investment caused shares of the company to skyrocket, and Sokol stood to make millions. Was Sokol’s purchase of those shares an instance of insider trading? And was Buffett complicit? Both men assured us that Sokol did nothing illegal. U.S. securities laws require disclosure of “material information,” which has in turn been defined by the Supreme Court as information where there is “a substantial likelihood that the disclosure of the omitted fact would have been viewed by the reasonable investor as having significantly altered the ‘total mix’ of information made available.” This definition leaves plenty of room for interpretation. Moreover, the fact that Sokol did not have final decision authority in making the deal almost certainly mitigates against a ruling of materiality. So I’m willing to bet that Sokol did nothing “illegal.” And, indeed, the S.E.C. decided in January, after a long investigation, not to file charges.

But even if it’s not illegal, is what Sokol did unethical? Here, too, the situation is far from straightforward. He might have advised Buffett to do the deal for the same reason he bought the stock — because he thought that the company was sound and undervalued. Buffett has made his billions precisely by seeking and then buying good, but undervalued companies. I doubt that if you put a bunch of business ethics professors together in a room they would emerge with a consensus about whether Sokol and Buffett did anything unethical. Admittedly it seems odd that a man like Buffett, who apparently values his reputation for honesty and integrity more than all his billions, would do anything that had even the appearance of impropriety. But the issues are complicated, and reasonable people can disagree, so perhaps we should give the “Wizard of Omaha” the benefit of the doubt.

What this episode reveals, beyond its particulars, is how difficult ethical judgments can be in the complex world of finance. Sure, we can make a bunch of “bright-line rules,” but as long as the world the rules applies to is fuzzy, there will always be room for interpretation and disagreement.

So, to cut through this complexity, I want to propose a single, simple ethical rule of thumb — one question people should ask themselves before embarking on a course of action. If people asked themselves this question, and took the answer to heart, we wouldn’t need ethics courses, ethics texts, and ethics panels. The question is this: “Would you tell your children?” If the answer to that question is yes, then go ahead and do it. If not, back away.

Other quick and dirty rules of thumb have been proposed over the years, but this one has the others beat. “Does it pass the smell test?” is one, but we invented perfume so that almost anything can pass the smell test. “Will you be able to look at yourself in the mirror?” is another, but for forty years psychologists have documented the ways in which people can deceive themselves when they look in the ethical mirror. “Would you tell your spouse?” That’s better, but also flawed. Our spouses have already learned about our various moral imperfections. They’ve gotten used to us. And they’ve learned from experience how ethically ambiguous life can be. We’re afraid that our spouses are too likely to give us a pass, or at least, the benefit of the doubt. But our kids? To kids, the world is a place of moral clarity and moral perfection, and their parents are moral heroes. There is no money in the world that can make up for the look of disappointment in a child’s eyes. If people just got in the habit of asking themselves this one question, many of the ethical problems we encounter on a daily basis would vanish.

Would a doctor order a procedure she thought unnecessary to earn a fee because she knew it would do no harm? Not if she asked herself this question first.

Would a banker offer a no-doc, unaffordable loan to eager home buyers, even if the post-teaser rates were fully disclosed and the clients insisted they knew what they were getting into? Not if he asked this question first.

Would a teacher deliberately teach students items that would be on the standardized test, even when he thought it was bad pedagogy? Not if he asked this question first.

And would Sokol and Buffett have done the deal? I don’t know the answer to this one, but my guess is that at the very least, they would have thought longer and harder about it before going forward. It’s amazing how ethically complex issues get simplified when we imagine having to explain ourselves to our kids.

I know that not everyone has kids, that some people’s kids are too young, and other people’s kids are too old — already jaded by corrosive experience in the actual world. But it shouldn’t be hard to adapt this question to your individual circumstances. “Would I tell my sister’s kids?” “Will I tell my kids when they get a little older?” “Would I have told my kids when they were in sixth grade?” I’m convinced that if we adopted this family of questions as our ethical touchstone, we could throw most of the ethics texts, casebooks, and guidelines away. We would do the right thing more often, and with less effort.

Posted by:Barry Schwartz