March/April 2007

President's notes

Leading the transition from good to great

By F. Pelletier

There are many books on leadership available today, promising insight to successful navigation in our highly competitive environment. I have just finished reading an interesting one called Good to Great by Jim Collins, recommended to me by my son.

The author, with his team of researchers, tried to identify why some companies transformed themselves from good to great and consistently out-performed their competitors in various industries.

What they found was that the good-to-great companies had Level 5 leadership during the transition years. Level 5 refers to a five-level hierarchy of executive capabilities, with Level 5 being at the top. Good companies were often led by executives with Level 4 leadership traits. Level 5 executives are humble yet have great professional will. The difference with Level 4 executives is that they are, first and foremost, ambitious for the company and not themselves. Level 5 leaders set up their successors for even greater success when they depart, whereas companies directed by Level 4 leaders often fail in ensuring good succession. Their research found that Level 5 leaders are often modest, self-effaced, and understated, whereas two-thirds of the comparator companies within mediocre or average-performing companies had enormous egos. Level 5 leaders are more like plow horses than show horses. They are resolved to do whatever it takes to make the company great, no matter how big or hard the decisions. Level 5 leaders have a tendency to attribute success to factors on which they have no control, and take the responsibility for things when they go poorly. Level 4 leaders do the opposite.

One of the chapters that struck me was the one regarding people and vision. What the researchers found within the transformation process by good-to-great leaders was that they put a lot of attention in getting the right people on the bus, the wrong people off the bus, and then figured out where to drive it. This basically says that they first determined who (people), before what (vision, strategy, structure, tactics, etc.).

The book also addresses other issues such as approach to technology, culture of the organization, defining your organization, and other strategic topics.

I wanted to share some of their observations with you. We all have Level 5 leaders in our organizations. Ten of 11 good-to-great company leaders came from inside the organizations that were examined. They are there. We just have to know what to look for.

François Pelletier, CIM President

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