Tuesday, February 15, 2011

What type of leader do YOU want?

I'm fascinated by leaders and leadership, both in government (my alliance in Starfleet Commander Universe 2 is called "Commanders in Chief") and in business. And since I've spent all of my working life in technology (in one way or another), I've had a chance to observe technology leaders as they rise and all.

And there's one observation that has held true - most of the people who founded companies in the tech boom of the 1970s aren't heading those companies today. Bill Gates, who today remains as chairman of the board at Microsoft, is a rare exception. Steve Jobs is another notable case, although his leadership at Apple was interrupted for over a decade.

In most cases, however, the founders chose to depart, and the reins of their firms were handed over to non-founder types.

In a recent editorial in InformationWeek, Rob Preston discussed the difference between the two types of leaders>.

"Professional CEOs" -- those adept at keeping costs down, market share on track, M&As in motion, and the regulators in check -- will always be valuable, but more often than not they don't build truly great companies. Think Jeffrey Immelt at GE or Mark Hurd when he ran HP: first rate executives who get the house in order but who don't rally the troops or enthrall the customer base over the long haul.

Preston then veered into the present with two examples:

As most are aware, Google announced last month that co-founder Larry Page will be taking over as CEO, replacing Eric Schmidt, the exec Page and Google's other co-founder, Sergey Brin, hired a decade ago to lead the company beyond its blockbuster startup phase....

Schmidt, the professional executive and respected technologist, served Google well during his decade as CEO. But with Google facing cutthroat competition from the likes of Facebook, Apple, and even Microsoft, the company decided it's time to bring the product vision and inspiration back to the CEO office.

The news out of Google came a week after Apple announced that founder-CEO Steve Jobs would be stepping aside for the second time in as many years for unspecified medical reasons, though Apple hasn't named a permanent or even interim replacement. Having sampled professional management in the 1980s, Apple isn't keen on handing the reins over to COO Tim Cook, an omnicompetent exec but no Steve Jobs when it comes to understanding what will wow customers.

Preston then noted that his views on the value of founding, inspirational CEOs are not universal:

In a famous 2001 Harvard Business Review article, management expert Jim Collins argued that the key element in turning good companies into great ones is "Level 5" leadership: CEOs with a paradoxical mix of personal modesty and "professional will." His Exhibit A was Darwin E. Smith, a low-key lawyer who transformed Kimberly-Clark into an industry leader in the 1970s and ‘80s. A rung lower in Collins' leadership hierarchy were the Level 4 types: those who "catalyze commitment to and vigorous pursuit of a clear and compelling vision" -- the profile of most enduring technology industry founder-CEOs.

Collins talked about Darwin Smith, as well as nine other CEOs, in a 2003 article. Most (but not all) of the people that he named were similar to Smith, and were more process-oriented than inspirational generals. For example:

Most people have never heard of Charles Coffin—and that's the ultimate testimony to his greatness. His predecessor had something to do with this. No CEO finds it easy to take over from a founding entrepreneur; now imagine that founder holds patents on the electric light, the phonograph, the motion picture, the alkaline battery, and the dissemination of electricity. But Coffin knew his job was not to be the next Thomas Edison—though Coffin, too, would prove a master inventor. His invention was the General Electric Co.

Coffin oversaw two social innovations of huge significance: America's first research laboratory and the idea of systematic management development. While Edison was essentially a genius with a thousand helpers, Coffin created a system of genius that did not depend on him. Like the founders of the U.S., he created the ideology and mechanisms that made his institution one of the world's most enduring and widely emulated.

But is there a middle way - one in which the company executes well and inspires at the same time? Collins says yes, and cites William McKnight of 3M (DISCLAIMER: I AM EMPLOYED BY A COMPETITOR OF 3M):

The early giants of industry tend to fall into one of two camps: Individual innovators (think Walt Disney) and system builders (think John D. Rockefeller). 3M's William McKnight falls into neither. Beginning in 1929, the bookish accountant fused the two models into something entirely new: a company that turned innovation into a systematic, repeatable process. While you couldn't predict exactly what McKnight's system would create, you could predict with certainty that it would create.

Obviously a company's need for a CEO will change depending upon individual circumstances, but it's a good topic for inquiry.

Hopefully my Starfleet Commander alliance is well served by its CEO.
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