Rule #3: Leadership Is Confusing As Hell

You think the past five years were nuts? You ain't seen nothin' yet! It's only going to get weirder, tougher, and more turbulent. Which means that leadership will be more important than ever -- and more confusing (see rule #3).

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Ladies and gentlemen, the captain has turned on the "fasten seat belt" sign. Please return to your seats immediately! Make sure that your tray tables are in the upright and locked position, and please return your seat backs to their full, upright position. Now brace yourselves: We're headed for some turbulent times!

Not that the past five years weren't demonstrably nuts. They were. But they were nuts in a generally recognizable way. Never mind all of that easy-to-come-by venture capital and the ATM approach to IPO cash. What really matters is how the past five years challenged us all to rip off our neckties, shed our standard-issue business suits, and, most important, lose our Model T-type business thinking.

But that was the past five years. For the next five years, we're going to go from nuts to flat-out freakin' crazy. For the next five years, it's business on a wartime footing -- a high-stakes, high-risk, high-profile event that is filled with uncertainty and ambiguity. And clear-cut performance outcomes matter more than ever before. You can still invent your own career, be your own brand, and promote your own project -- you just gotta sprint and deliver.

Think of pre-1990 as the Age of Sucking Up to the Hierarchy. The Age of the Promise 'Em Everything Pitch lasted from 1995 to 2000. The next five years will be the Age of No-Bull Performance. Which means that we're going to see leadership emerge as the most important element of business -- the attribute that is highest in demand and shortest in supply. And that means that over the next five years, we're going to have to reckon with a new, unorthodox, untested, maybe just plain freaked-out list of leadership qualities: 50 ways of being a leader in freaked-out times.

1. Leaders on snorting steeds (the visionary greats!) are important. But great managers are the bedrock of great organizations. LEADERSHIP became sooooo coooool in the 1990s. Crank out THE VISION. Harangue the troops. Stand tall in the saddle. Management? That was for wusses, wimps, and dead-enders.

Well, I aim to amend all of that. Vision is dandy, but sustainable company excellence comes from a huge stable of able managers. If you don't believe me, then go read First, Break All the Rules: What the World's Greatest Managers Do Differently (Simon & Schuster, 1999), by Gallup execs Marcus Buckingham and Curt Coffman. Here's a boiled-down version of what they found: Great managers are an organization's glue. They create and hold together the scores of folks who power high-performing companies.

Stop being conned by the old mantra that says, "Leaders are cool, managers are dweebs." Instead, follow the Peters Principle: Leaders are cool. Managers are cool too!

2. But then again, there are times when this cult-of-personality stuff actually works! Okay, here goes the zig-zag, paradoxical path of leadership in freaked-out times. It's true that there are times of genuine corporate peril when no one other than a larger-than-life visionary leader can get the job done.

As far as I'm concerned, the first business leader who was able to establish a cult of personality around his tenure was Lee Iacocca. When he took over as Chrysler's chairman and CEO in 1978, that company was on its deathbed. Chrysler turned to him the way the country turns to charismatic leaders in times of war -- which is exactly how Iacocca characterized Chrysler's competitive situation. The Japanese, Iacocca said, were eating our lunch, and he was going to be the wartime leader to rally the troops. The point is, there are times when you really do need to turn to a leader who offers a broad, popular, galvanizing vision -- someone who can symbolize a new approach to business.

3. Leadership is confusing as hell. If we're going to make any headway in figuring out the new rules of leadership, we might as well say it up front: There is no one-size-fits-all approach to leadership. Leadership mantra #1: It all depends. Years ago, Yale professor of organization and management and professor of psychology Victor Vroom developed a model that was later adapted and popularized by Ken Blanchard. Their point: We need to think about situational leadership -- the right person, the right style, for the right situation.

I saw it at McKinsey & Co. when I went to work there. The firm had gotten offtrack operationally, so the partners elected Alonzo McDonald to be the managing partner. They didn't do this because they liked him (he wasn't the cuddly sort), but because he was the right guy to fix what was broken. McDonald did precisely what the partners wanted him to do but were unwilling to do themselves: He busted the weak performers, tightened up the control systems, and put the firm back on profitable ground. After which the partners said, "Enough!" -- and booted him straight to the White House to be assistant to president Jimmy Carter and director of the White House staff. Motto: The situation rules. Leader for all seasons? In your dreams!

4. When it comes to talent, leadership doesn't income-average. It's a favorite one-liner these days: There is no "I" in team. What crap! Is there anyone who really thinks that Phil Jackson won six NBA championships with the Chicago Bulls by averaging Michael Jordan's talent with that of the rest of the team? Yes, teamwork is important. No, teamwork doesn't mean bringing everyone with exceptional talent down to the level of the lowest common denominator.

Bottom line: Stellar teams are invariably made up of quirky individuals who typically rub each other raw, but they figure out -- with the spiritual help of a gifted leader (such as Phil Jackson at Chicago or Los Angeles) -- how to be their peculiar selves and how to win championships as a team. At the same time.

5. Leaders love the mess. One leader who deserves to be celebrated? That fabulous third-grade teacher your Charlie has -- the one who sees each of her 23 charges as unique-quirky souls who are in totally different places on their developmental paths toward becoming their cool-peculiar selves. The third-grade teacher whom you should avoid at all costs? The one who's got everything under control, with all of the kids sitting at their desks, completely unable to express themselves. There's no mess -- and no creativity, no energy, no inspired leadership. You want leadership? Go find a fabulous third-grade teacher, and watch how he "plays" the classroom.

6. The leader is rarely -- possibly never? -- the best performer. I once read that the three greatest psychological transitions an adult human being goes through are marriage, parenthood, and her first supervisory job. In each of these situations, people learn to live and to succeed primarily through the success of others. Which is why there is no more important decision that a company makes than the selection of its first-line managers.

Who are those people? Take a look at the former players from the world of sports who become the best coaches and managers. Last summer, Tommy Lasorda coached the U.S. Olympic baseball team to a gold medal, finally defeating the Cubans. In his career with the Los Angeles Dodgers, Tommy L. was a terrific manager. His own career as a player? It lasted for three at bats.

The best leader is rarely the best pitcher or catcher. The best leader is just what's advertised: the best leader. Leaders get their kicks from orchestrating the work of others -- not from doing it themselves.

7. Leaders deliver. If you're aiming to be a real leader during the next five years, then you need to mimic the pizza man: You'd better deliver! For the past five years, ideas and cool have counted (which was important). What counts now? Performance. Results.

8. Leaders create their own (peculiar?) destinies. During the next five years, there won't be room for paper pushers. Only people who make personal determinations to be leaders will survive -- and that holds true at all levels of all organizations (including entry level).

Surprisingly, we've seen this phenomenon take place most often where most people least expect to find it: in the military. First, war is the ultimate improv venture. The most improvisational, least hierarchical situation that I've ever been in was my 16-month stint in Vietnam. But second, real-life experience in the Army or in the Navy teaches you that you must have leaders at every level. So too in today's corporate wars. In this new world order, the real battle starts when the computer gets knocked out, the captain gets killed, the lieutenant is gravely wounded, the sergeant is hesitant, and suddenly the 18-year-old Iowa farmhand finds himself leading a platoon into combat. And the life and death of the company or the team or the project hangs in the balance. That's leadership at all levels, which boot camp teaches a lot better than business school.

9. Leaders win through logistics. Vision, sure. Strategy, yes. But when you go to war, you need to have both toilet paper and bullets at the right place at the right time. In other words, you must win through superior logistics. Go back to the Gulf War. After that war ended, the media stories focused on the strategy that was devised by Colin Powell and executed by Norman Schwartzkopf. For my money, the guy who won the Gulf War was Gus Pagonis, the genius who managed all of the logistics.

It doesn't matter how brilliant your vision and strategy are if you can't get the soldiers, the weapons, the vehicles, the gasoline, the chow -- the boots, for God's sake! -- to the right people, at the right place, at the right time. (Right now, Amazon.com and a hundred of its dotkin are learning -- or failing to learn -- the Gus Pagonis lesson.)

10. Leaders understand the ultimate power of relationships. Here's a mind-blowing proposition: War -- or business on a wartime footing -- is fundamentally a woman's game! Why? Because when everything's on the line, what really matters are the relationships that leaders have created with their people. I recall a Douglas MacArthur biographer who claimed that the one piece of advice that MacArthur most valued (which was passed on to him by one of his military forbearers) was "Never give an order that can't be obeyed." But women already know that. They tend to understand the primacy of massive IIR (investment in relationships), which is one reason why the premier untapped leadership talent in the world today rests with women!

11. Leaders multitask. Which element is in the shortest supply today -- and tomorrow and tomorrow? Time. The future belongs to the leader who can juggle a dozen conundrums at once. And who is he? I mean she? I just glanced at a lovely book called Selling Is a Woman's Game: 15 Powerful Reasons Why Women Can Outsell Men (Avon Books, 1994), by Nicki Joy and Susan Kane-Benson. Take this quick quiz, the authors urge: Who manages more things at once? Who usually takes care of the details? Who finds it easier to meet new people? Who asks more questions in a conversation? Who is a better listener? Who encourages harmony and agreement? Who works with a longer to-do list? Who's better at keeping in touch with others? Now that's what I call multitasking! And again: Let's hear it for women leaders!

12. Leaders groove on ambiguity. Message 2001: Wall Street is nuttier than a fruitcake! All of that stuff they teach us in Economics 101 about rational expectations? In the past year, we've seen those "rational" boys and girls of Wall Street fall in and out of love with whole sectors of the economy the way teenagers with overactive hormones swoon and dive over movie stars. But when Wall Streeters do it, real leaders in real companies feel real effects.

The next five years are going to be an economic roller-coaster ride. That means that business leaders are going to be challenged repeatedly not just to make fact-based decisions, but also to make some sense out of all of the conflicting and hard-to-detect signals that come through the fog and the noise. Leaders are the ones who can handle gobs and gobs of ambiguity.

13. Leaders wire the joint. The good-old-boy's network provided a direct way of operating: I'm a vice president, you're a vice president. I want your order, I call you up, I take you out for a drink or a game of golf, and, man to man, I get your order.

It doesn't work like that anymore -- not when power is diffuse, alliances are ever changing, and decision-making channels are fluid, indirect, and muddy. The game today: Soft-wire the whole joint. The way to make the sale today -- or to have influence on any high-impact decision -- is to build, nurture, and mobilize a vast network of key influencers at every level and in every function of the operation.

14. Leadership is an improvisational art. The game -- hey, the basic rule book -- keeps changing. Competition keeps changing. So leaders need to change, to keep reinventing themselves. Leaders have to be ready to adapt, to move, to forget yesterday, to forgive, and to structure new roles and new relationships for themselves, their teams, and their ever-shifting portfolio of partners.

15. Leaders trust their guts. "Intuition" is one of those good words that has gotten a bad rap. For some reason, intuition has become a "soft" notion. Garbage! Intuition is the new physics. It's an Einsteinian, seven-sense, practical way to make tough decisions. Bottom line, circa 2001 to 2010: The crazier the times are, the more important it is for leaders to develop and to trust their intuition.

16. Leaders trust trust. My longtime business partner Jim Kouzes and his colleague Barry Posner nailed it with a one-word title to their recent book: Credibility (How Leaders Gain and Lose it, Why People Demand It, Jossey Bass Publishers, 1993). In a world gone nuts, we cry out for something or someone to rely on. To trust. The fearless leader may (make that, had better) change his or her mind with the times. But as a subordinate, I trust a leader who shows up, makes the tough calls, takes the heat, sleeps well amidst the furor, and then aggressively chomps into the next task in the morning with visible vitality.

17. Leaders are natural empowerment freaks. There are two ways to look at Jack Welch's legacy as a leader. The first is to say that he has created more value for his shareholders than any other comparable modern-day business leader. Which he has. He has also created more leaders than any comparable modern-day business leader.

When we think of Welch, we do not ordinarily think vision. (What is GE's vision? I haven't a clue! "We bring good things to life" ain't it.) We do think rigorous performance standards, empowerment ("WorkOut" in GE-speak), leadership, and talent development. Jack Welch, it turns out, is a great manager (see rule #1).

18. Leaders are good at forgetting. Peter Senge's brilliant insight 10 years ago was that companies need to be learning organizations. My campaign 2001: Companies need to be forgetting organizations. Enron Corp., which has repeatedly been tagged as the nation's most innovative corporation, is exhibit A as a world-class forgetting organization. It's not wedded to what it did yesterday. Enron chiefs Kenneth Lay and Jeff Skilling have figured out how to operate like a band of pirates. Got an idea? Don't dally. Go for it while it's an original! Doesn't work? Try something else. If that doesn't work, fuhgeddaboutit!

19. Leaders bring in different dudes. This is a corollary to forgetting. Many leaders are preoccupied with creating high-performance organizations. But to that, I say: Crazy times demand high-standard-deviation organizations! This isn't just weirdness for the sake of weirdness. This is weirdness for the sake of variety.

Winning leaders know that their organizations need to refresh the gene pool. That happens when leaders forget old practices and open up their minds to new ones. That also happens -- and more effectively -- when leaders bring in new people and new partners with new ideas. As a leader, do with your people what Cisco has done so effectively with technology: Acquire a new line of thinking by acquiring a new group of thinkers.

20. Leaders make mistakes -- and make no bones about it. Nobody -- repeat, nobody -- gets it right the first time. Most of us don't get it right the second, third, or fourth time either. Winston Churchill said it best: "Success is the ability to go from failure to failure without losing your enthusiasm." Churchill blew one assignment after another -- until he came up against the big one and saved the world.

As times get crazier, you're going to see more -- and dumber -- mistakes. When you make mistakes, you need to recognize them quickly, deal with them quickly, move on quickly -- and make cooler mistakes tomorrow.

21. Leaders love to work with other leaders. Nortel CEO, president, and VC John Roth says, "Our strategies must be tied to leading-edge customers on the attack. If we focus on the defensive customers, we will also become defensive." Amen. (No: AMEN!) Leaders are known by the company they keep. If you work with people who are cool, pioneering leaders who have customers who are cool, pioneering leaders who source from suppliers who are cool, pioneering leaders -- then you'll stay on the leading edge for the next five years. Laggards work with laggards. Leaders work with leaders. It really is that simple.

22. Leaders can laugh. Another corollary to the art of leadership and making mistakes: No one's infallible (except for the Pope). In order to survive in these wild times, you're going to make a total fool of yourself with incredible regularity. If you can't laugh about it, then you are doomed. Take it from me. (And if you are a humorless bastard, please do me a favor: Don't immediately march over to your VP of human resources and order, "Ve vill haff humor! Bring me ze funny people!" But do remember the madness of the times. Humor is the best tool you've got to keep your team from going mad. No bull!)

23. Leaders set design specs. You can't be a leader over the next five years and not be totally into design. Design specs are the double-helix DNA that sets the tone of the culture and establishes the operating ideas that embody the company. They are your distinguishing characteristics, your brand's brand. If you don't already know how, learn how to speak design. Apple CEO Steve Jobs calls design "soul." I say: Design specs = soul operating system.

24. Leaders also know when to challenge design specs. Here comes another bloody brain flip: In zany times, design specs (corporate character) must be open to constant reevaluation. What worked during the past five years may or may not work for the next five years.

The classic example we should all watch: What will Jeffrey Immelt do when he takes over "the house that Jack built" at GE? Want to know what kind of leader Immelt will turn out to be? The clearest signal will come from how he handles GE's design specs. In this Age of Madness, nothing is holy. Even at GE.

25. Leaders have taste. It's a big part of the often-subtle topic of design. There is such a thing as good taste. Maybe a better word is "grace." I love this quote from designer Celeste Cooper: "My favorite word is 'grace' -- whether it's amazing grace, saving grace, grace under fire, Grace Kelly. How we live contributes to beauty -- whether it's how we treat other people or the environment." Leaders who would change our lives don't shy away from words like grace and beauty and taste.

26. Leaders don't create followers, they create more leaders. Too many old-fashioned leaders measure their influence by the number of followers that they can claim. But the greatest leaders are those who don't look for followers. Think of Martin Luther King Jr., Mohandas Gandhi, or Nelson Mandela. They were looking for more leaders in order to empower others to find and create their own destinies.

27. Leaders love rainbows -- for totally pragmatic reasons. Another good word gone bad: "diversity." The case for diversity during the past 20 years has been that it was the "right thing to do." Well, in no-bull times, diversity isn't a good thing, it's an essential thing. It's a survival thing. The case for diversity is the case against homogeneity: When the world is undergoing sudden, unpredictable, dire change, you need to have a diverse gene pool. You need to have multiple points of view. In a heterogeneous time, homogeneity sucks!

28. Leaders don't fall prey to their own success. There are a lot of people who have made it really, really big over the past five years. Some of them actually think that they're responsible for their success, if you can imagine that. But in crazy times, leaders don't believe in their own press clippings. And they never, ever let their organizations get complacent! Read The Paradox of Success: When Winning at Work Means Losing at Life: A Book of Renewal for Leaders (G.P. Putnam's Sons, 1993), by John O'Neil. He talks about the good qualities that breed monsters. The first one on the list: Confidence breeds a sense of infallibility. Again: Amen.

29. Leaders never get caught fighting the last war. It's the age-old problem with bemedalled generals: They're always preparing to fight the last war. The lesson, embedded in history, applies to business. What business are you in? The only answer that makes sense today is, God alone knows! Did you win the war during the past five years? Were you an early adopter of Internet ways? Good for you! The only problem is that the Internet is still in diapers. The old giants are awakening to its potential. What's your next totally new act?

30. But leaders have to deliver, so they worry about throwing the baby out with the bathwater. Did I mention that these are paradoxical times? Well, they are. So here's the flip side to the other side: You must execute consistently, while fighting consistency. Years ago, in Liberation Management: Necessary Organization for the Nanosecond Nineties (A. A. Knopf, 1992), I called it the "ultimate leadership paradox." To be "excellent" (to deliver profits, provide quality, and satisfy customers), you must be consistent and build a stellar infrastructure-delivery capability. But the single-mindedness that allows you to hit earnings targets and quality goals is a disguised set of blinders that makes you vulnerable to new, oddball threats (consistency = focus = blinders). Love the bathwater! Throw the bathwater out! Go figure!

31. Leaders honor the assassins in their own organizations. There's only one reason why any human being ever makes it into the history books: because he or she remorselessly overthrew the conventional wisdom. Those are leaders. But truly great leaders, the ones who aim to leave a legacy, go to the next level. They consistently seek out and honor the people in their own organizations who want to overthrow their conventional wisdom. Great leaders honor the people who want to depose them, the assassins in their midst. Real leaders, repeat after me: All hail Brutus!

32. Leaders love technology. I mean love! L-O-V-E. Here's the equation for the next five years: Technology = architect of change. If you don't love (and I don't mean like or tolerate) the technology, it will change you and your company, but you will be the unwitting victim, not the partner of change. Look, you don't have to be a technologist. But you must embrace technology, care for it. It is your friend, your lover. It will be unfaithful at times. It will lead you down dark and dangerous alleys. No matter. It is remaking the world. And you must joyously leap aboard (that's the way love is).

33. Leaders wear their passion on their sleeve. There's absolutely no question in my mind: Leaders dream in Technicolor. They see the world in brighter colors, sharper images, and higher resolution. Leadership, in the end, is all about having energy, creating energy, showing energy, and spreading energy. Leaders emote, they erupt, they flame, and they have boundless (nutty) enthusiasm. And why shouldn't they? The cold logic of it is unassailable: If you do not love what you're doing, if you do not go totally bonkers for your project, your team, your customers, and your company, then why in the world are you doing what you're doing? And why in the world would you expect anybody to follow you?

34. Leaders know: Energy begets energy. Every successful company, every successful team, and every successful project runs on one thing: energy. It's the leader's job to be the energy source that others feed from. But sometimes the leader has no energy. Sometimes the situation is bleak, and the outcome is in doubt. And I say: Fake it! For it is at that critical juncture that having energy is the most essential. So if you gotta fake it, then fake it! Once you kick-start the energy cycle, nature takes over. The energy will start to flow. Benjamin Zander said it best: The job of the leader is to be a "dispenser of enthusiasm."

35. Leaders are community organizers. Let's hear three raucous cheers for Saul Alinksy! (Haven't heard of him? Quick! Go to Amazon.com and buy Rules For Radicals: A Practical Primer for Realistic Radicals [Random House, 1971]. Read it immediately!) It doesn't matter if you're recruiting talent, making a sale, or forging a partnership. Everything you do is the exact equivalent of grassroots organizing.

Your title may say that you are the leader, but you're running for office every day. Want to pull off that Internet-enabled business-process redesign? You've got to get the frontline commitment, the votes! You've got to get your customers to vote for you, your suppliers to vote for you, your employees to vote for you. How do you get them to do more than just show up? You enlist them and win their votes one damn day at a time.

36. Leaders give respect. There's another great book with a one-word title: Respect (An Explanation, Perseus Books, 1999), by Sara Lawrence-Lightfoot. The heart of her message: "It was much later that I realized Dad's secret. He gained respect by giving it. He talked and listened to the fourth-grade kid in Spring Valley who shined shoes the same way he talked and listened to a bishop or a college president. He was seriously interested in who you were and what you had to say." Care. Respect. Leaders care about connecting -- because it moves mountains.

37. Leaders show up. Legendary, all-powerful sports agent Mark McCormack offers a potent lesson on leadership in one of his books. He insists that, even in the Internet Age (or is it especially in the Internet Age?), it's a worthwhile show of commitment and respect (see rule #36) to travel 6,000 miles round-trip to consummate a five-minute face-to-face meeting. Hatim Tyabji, who was then the soft-spoken, charismatic CEO of Verifone, once traveled from South Africa to Colorado -- on his way to Norway -- to give a one-hour presentation at a conference of just 30 people. Why? Because three months prior to that engagement, before all of the other trips had even been booked, he had promised to be there. I guarantee that people paid uncompromising attention to his one-hour talk, because he showed uncompromising leadership by showing up.

38. Leadership is a performance. According to HP big cheese Carly Fiorina, "Leadership is a performance. You have to be conscious about your behavior, because everyone else is." Leaders spend time leading -- which means that they spend time and exert ceaseless effort making sure that they come across with the right message in the way that they walk, talk, dress, and stand. Leadership is not only about action. It's also about acting.

39. Leaders have great stories. A performance (see rule #38) needs to have a script. Howard Gardner wrote about that in his book, Leading Minds: An Anatomy of Leadership (BasicBooks, 1995). Effective communication of a story is a key -- perhaps the key -- to leadership.

Why? Because stories are the real thing. They are how we remember, how we learn, and how we visualize what can be. If you want to involve your colleagues in the future performance of your business, then don't just present them with the numbers. Tell them a story. Numbers are numbing. Stories are personal, passionate, and purposeful.

Click here for Rules 40 - 50

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