How to Lead Now

Building pride is hardly a new idea. The most effective leaders have always known that the best work is inspired not by economics alone, but also by emotions, and they have engaged employees as allies, creating a sense of accomplishment, camaraderie, and emotional attachment that helps achieve big goals. Pride building is at the core of many high-performing organizations, ranging from the U.S. Marines to Southwest Airlines. What's remarkable is the degree to which we've lost sight of that fact, after a decade or more of squeezing productivity growth from layoffs, cutbacks, and technology investments. Too many leaders have focused their ambitions on themselves rather than on their organizations. Too many leaders are in it for personal enrichment or aggrandizement, a show-me-the-money style of leadership that has led directly to today's landscape of wrecked corporations and indicted CEOs.

It doesn't help that in most companies today, money is scarce, and stock-option plans are likely to be pared back as more corporations expense options on their income statements. Besides, the money is almost beside the point. If they are being paid reasonably, workers are far more likely to rank feeling fully appreciated and having interesting work as more important than high wages or job security. "Money attracts and retains people better than it motivates them to excel," argues Katzenbach.

What many of the corporate scandals confirmed, Katzenbach believes, is that systems of reward that are purely monetary can feed self-serving behavior and foster avaricious cultures that more easily self-destruct. But while the Marines, Marriott, and Microsoft have pride-based cultures, such organizations are relatively rare. "There are probably never going to be many Southwest Airlines," says Niko Canner, a Katzenbach partner who is helping lead a major research effort to learn more about the impact of pride building. "Most of these organizations are more short-lived than we hope."

Such cultures are unusual due to a particularly intriguing aspect of pride building. The push often comes from individuals within organizations -- and not from the organizations themselves. Pride builders understand that most employees feel alienated from companies that spend years trimming their health benefits and laying off their friends. "Employees today are no longer loyal to organizations as much as they are loyal to people," says Bob Nelson, president of Nelson Motivation Inc., a management-training firm. "[Employee] recognition is more powerful when it's personal and heartfelt." That is why, unlike many management ideas, pride building is not a CEO-led phenomenon, but rather a task for frontline leaders, who are closest to the real work of a corporation. These leaders believe that commitment and loyalty derive solely from the relationships that they strike with the people who report to them. So they personalize the workplace, cultivating close-knit communities inside large, often impersonal corporations.

And that means that their efforts can be a bit transgressive. When they make work personal, pride builders often launch minirevolutions, breaking the rules set by human-resource departments and getting involved in the private problems of employees. They have a tell-it-like-it-is philosophy of communication, keeping employees informed about everything that affects them, good and bad. And these exceptional leaders may even encourage thinking that pits their group or division against the corporation itself -- with the ultimate goal of gaining better performance for the company.

"I had no life for six months, and yet I was sad about seeing it end."

Mary Cadagin

A good example of the sometimes insurrectionist nature of pride building is the turnaround at General Motors' huge assembly plant in Wilmington, Delaware. In the early 1990s, the automaker dispatched a group of executives from Detroit, assembled all of the 3,500 employees in a vast area of one building, and told them that GM had decided to shut down the place by 1996 to reduce costs. "There is nothing you can do to affect this decision," a visiting GM suit proclaimed from the podium.

After the execs left, plant manager Ralph Harding made an impassioned speech to the shell-shocked workers, whose morale was at its lowest ebb. "There may be nothing we can do to affect this decision," Harding said. "But there is something we can do: We can make them feel really stupid! Because they are going to be closing the best plant in General Motors!" Harding then galvanized the workforce to make the Wilmington plant a model for every factory in the GM system.