Posted by: Matthew Molinari | April 11, 2011

Level 5 Leadership (Blog #14)

There doesn’t seem to be anything revolutionary about the idea that a great leader can transform a good company into a great company. Granted, the best leader couldn’t turn around a company that didn’t have other positive attributes but clearly it is much harder without that type of leader.

What really seems to be a deciding factor is what type of company those in charge want to create. Being a great company takes many things:a certain type of leadership, a careful selection of employees and maintaining an business plan to name a few. Creating a good company takes only some of those, still difficult but much easier and can still make money.

The important question to ask is yes, you may be good, but are you reaching your full potential as a company. The answer to that probably lies in the person in charge. There seems to be a great deal of group think in terms of what makes a good leader. Especially in the current era of entertainment crossing over into all aspects of life, companies are looking for leaders that will improve their image even if they don’t improve the business.

A good idea might be to not hire a CEO who just left a successful company for at least a year. That way, you could see how the company did without them. Do you really want to base the success of your company on the presence of one person so that when they leave you are crippled? Maybe, if you are looking to build value, sell the company and make a fortune. But what if you want to create a company that depends on employees at every level for success. That way no one person really runs your company and when problems arise, the business can rely on a team rather than an individual to power through.

The one thing that I find tough to accept that is that ego in a leader is a bad thing. Perhaps, it’s not the ego that is detrimental to the leader but how they handle it. There is may be something to the idea though if the leader is dependent on solid data. Making the decision to change the focus of Walgreen from restaurants (how the business started) to focus on the pharmacy could either based on an ego, “We can do this because I believe we can” or on really good data, “We can do this because the studies show we can”.  I suppose, a leader who makes a decision based on purely on their ego, or gut, can make radical changes that have a 50/50 chance of success while a leader who bases a radical decision on data has a much better chance of seeing improvement.

The most refreshing thing about a level 5 leader appears to be that they wouldn’t take the credit for that success. They, for the most part, always looks to pass the success and not the blame. This seems to be the case with Col. Dowdy who was apparently doomed no matter what he did. He was a Level 5 leader who worked for a company who didn’t know where the bus was going. Even the best leader can’t be successful if there isn’t a clear plan. Unfortunately, there was no clear data on the best way to wage a war and Dowdy suffered for it.

The Marines lost a leader whose men admittedly said they would still follow him anywhere even after his dismissal. Is that really the type of leader you want to let go?

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