People Acumen

In an excerpt from his new book Leaders at All Levels, Ram Charan discusses which social qualities make someone a good leader.

Leadership is predicated on the ability to mobilize others to accomplish a vision, a goal, or a task. Leaders can't do everything; they get other people to do things through managing. They increase their capacity -- the ability to get more done -- through delegation combined with a methodology for ensuring follow-through. They set expectations, get the best people to do what needs to be done, and oversee the relationships among them to ensure that destructive or self-interested behaviors don't subvert the group's common purpose.

You know you've discovered a leader with people acumen when you see evidence that the person selects the right people and motivates them, gets them working well as a team, and is able to diagnose and fix problems in coordination and social relationships among groups of people.

Real leaders, I have found, exhibit an enthusiasm for selecting people who are better than they are -- whether or not they have worked with them before -- and then using those subordinates to lift the organization and themselves to new levels of accomplishment. They motivate their people and develop them as conditions change, retaining those who advance the business and having the courage to deselect with dignity those who don't. Such leaders show a repeated pattern of accurately identifying other leaders' talents, helping them flourish, or easing them into other jobs where their talents fit better. You can often identify a true leader because the people working under that person are of high caliber, are energized, and have a natural affinity for the leader and want to see him or her succeed.

Leaders with people acumen get the most out of their people by setting clear goals, then giving feedback and coaching judiciously to help achieve them. Most use some kind of performance indicators (the term I use is key performance indicators, or KPIs) that not only measure progress in quantitative terms but also influence behaviors. A KPI may be as simple as the percentage of customer calls answered in the first minute or may be as broad as corporate profitability measured against competitors. They watch for problems that might get in the way of achieving the KPIs and don't hesitate to give people unvarnished feedback. They are keen judges of when someone is not up to the task and don't back off from making the hard decision to replace him. Many people who think they're leaders are terribly uncomfortable and indecisive in the realm of personalities, even when they have the insight into who and what needs coaching. Some have a deep-rooted need to be liked that compromises their judgments of people.

Anyone can improve his or her ability to select and develop people's talents, but other aspects of people acumen are hard to teach. Leaders with people acumen have good instincts to anticipate problems among individuals who must work together and to get them resolved. They size up the group dynamics and pinpoint simmering conflicts, then draw them to the surface to unblock the group's progress. They intervene when they detect behavior that disrupts the working of the group. These leaders are fearless where many people are unconsciously concerned that if they try to change the group dynamics, they'll be cut apart or ignored and lose face.

Social acumen also manifests itself in network building. Leaders who possess it are not loners or bookworms. They have an innate desire to work with diverse people and naturally cultivate a broad range of social networks that permeate the company, including subordinates, peers, and superiors. As these leaders develop their social acumen, their networks often extend beyond the business to include customers, suppliers, regulators, politicians, and various interest groups. The relationships tend to be durable because they are built on trust, and that trust allows information to flow both ways, exposing the leader to new ideas and different ways to see things. The social networks also allow him or her to energize and synchronize people's energy and actions and to do a better job managing a crisis than would otherwise be the case.

Ram Charan is the author or coauthor of many bestselling business books, including What the CEO Wants You to Know and Execution. For more than thirty-five years, he has worked behind the scenes at Fortune 100 companies like GE, Bank of America, DuPont, Thomson financial, Honeywell and Home Depot to help senior executives develop and implement strategic plans.

Add New Comment

1 Comments

  • Mike Wright

    From Wikipedia: "The perception of business acumen as a valuable and necessary quality for high-level corporate leaders has occurred within a short period of time… some have classified business acumen as simply a buzzword." Now we've got people acumen. It's no wonder that business acumen training is becoming a critical concern of modern leadership development.