For the past 35 years I’ve been helping leaders win. Winning is never easy. Especially now. And it’s not just because competition is more fierce and game-changing technology is being developed every nano second. Winning is hard because most of us don’t spend enough time critically thinking about what winning means to us. Instead we tend to accept others’ definition of winning and then start sprinting in a direction that has no finish line. This rarely leads to life’s biggest win—personal happiness and true contentment.
And increasingly, neither does it lead to winning at making money. So what does it mean to win? A research base of 250,000 business leaders over three decades confirms that humans have three prime motives. This is important. Our prime motive constantly directs our attention and focuses our energy on goals we believe will make us happy. Prime motive number one is distinguished achievement, attaining goals that set you apart.
Number two is beating your competition. And number three is enriching the lives of others, creating value for human beings. These are three very distinct motives each of which leads each of us to invest our daily energy very differently depending on how we define winning. It turns out that the general population divides in approximately three equal segments according to these three prime motives… but not so in business leadership. The higher up we look in organizations more leaders are primarily driven to achieve difficult goals or to beat the hell out of the competition. Fewer wake up in the morning fired up to create meaningful value for customers or to enrich the lives and capabilities of their employees. This has become a leadership problem.
And it’s getting worse. Today’s hyper competitive businesses can no longer count on winning by making money the old fashion way. That’s because everything we’ve learned about effective leadership has changed. It’s pretty simple. If you are a leader your thinking simply has to shift or realign with the new realities or you will fail, and no amount of hard work toward goals that no longer matter can save you. This change of mindset isn’t easy. We all rely on our old thinking habits because being open-minded to new, disturbing information is both unpleasant and inefficient.
And that’s the fundamental problem. Most leaders, especially those driven by achievement and competitiveness, have been seduced by efficiency… whatever the quickest, easiest way is to make money right now. In 1993 I led a project for the American Quality Foundation focused on making Total Quality Manage (TQM) normal business practice in the U.S. It was vital at the time. Japan was making great cars and electronics and the U.S. wasn’t. TQM was driven by engineers who figured out how to use statistics to reduce variance, cost, and people to more efficiently create reliable products.
By the mid-nineties this movement became known as business process reengineering, then Six Sigma, now lean thinking. But the world economy is “leaned out.” There are few advantages that persist from further efficiency. In fact many of the supposed gains through enterprise wide business processes have proven an illusion. We all know businesses cannot save their way to sustainable prosperity.
For that you need to create new value. Real value. Value that matters to human beings. It is only by creating a Unique Value Advantage (UVA) that an enterprise can sustain healthy financial margins to reinvest in motivated employees and make new bets on products, offerings, and markets that provide a steady source of growth. I call this Value Added Enterprise.
This requires leaders to have authentic empathy for both customers as well as employees so they can conceive of value that actually matters to human beings. This requires a different way of thinking—literally, reviving a different part of your brain that enables you to see and feel things that a cost-saving mindset filters out. In order to awaken the dead part of a leader’s brain I use a three step process. First, years of research has revealed that the top 3% of effective leaders do three things really, really well. They 1) set clear direction, 2) inspire and motivate their workforce and stakeholders, and 3) drive results.
The most compelling data on leadership behavior suggests that 97% of business leaders don’t do these three things well. In fact, only 10% of leaders do two of them well. Perhaps that’s why truly great leaders are rare. The interesting thing is that the rarest of the three essential qualities of great leadership is number two—inspiring others. Now we know that’s because people are most inspired by meaning rather than goals.
It’s true, the evidence is we are much more meaning-seeking beings than pleasure-seeking ones. And the root of human meaning is enriching the lives of other human beings, which translates into adding value. It’s even better if it’s unexpected value and best if it’s unique value. If you question that just consider a brief list of most admired leaders and ask yourself what they have in common:
- Steve Jobs—Apple
- Howard Schultz—Starbucks
- Tony Hsieh—Zappos
- Doug Conant—Campbell’s Soup
- Mark Parker—Nike
- Herb Kelleher—Southwest
- Beth Comstock—GE
- Sam Palmisano—IBM
- Blake Mycoskie—TOMS
If you guessed that all these leaders are up to something more than making money, you’d be correct. Each one has created or revived a brand with a unique value advantage based on a value added strategy. Great leadership begins with clear leader intent that comes from the inner passion to make a customer’s life better.
What is your company currently doing that is adding unique value to your customers?