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elizabeth ferrarini

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The economic downturn has caused executives at all levels to scramble to find innovative ways to keep employees motivated and contributing to the organization. Enterpriseleadership.org turned to Ken Blanchard, the best-selling management book author, and leadership researcher and consultant, to learn how C-level executives can lead at a higher level. In fact, Leading at a Higher Level (Revised and Expanded) is the title of Blanchard's recent book. It  includes work The Ken Blanchard Companies have done with Nissan, Tyco International, and Ritz-Carlton Hotel Company.

 

Blanchard gain fame in 1982 when his 111-page One Minute Manager made the best-sellers list. It has sold more than 13 millions copies. This book remains on the list of best-selling business books. He has continued to turn out best-selling titles such as Whale Done, Know You Can, and The One Minute Entrepreneur. Blanchard frequently co-authors books with CEOs, such as Garry Ridge, the CEO of The WD-40 Company.

 

He teaches in the Executive Leadership Program at San Diego State University. Blanchard has received many honors and awards for his contributions in the fields of management, leadership, and inspirational speaking. He was inducted into Amazon.com's Hall of Fame as one the top 25 best-selling authors of all times.

 

EL. Why did you decide to write this book despite the economic downturn?

 

KB. For a long time, people have been asking us for our curriculum -- in what ways do we help companies? This book became an attempt to pull together everything we have been doing for 30 years. I have 15 co-authors. All of these people helped us build our company including my wife and my son. It was a good time to do it. I define leading at a higher level as essentially helping people accomplish worthwhile goals. It takes into consideration the needs and concerns of everyone involved. Making money is not a worthwhile goal; it is the byproduct of a goal. You need to consider why the economic downturn happened. It came about because of greed, short-term goals, and Wall Street. It is an entire value issue.

 

EL. What affect has the economic downturn had on C-level executives and what have companies done about it?

 

KB. I recently spoke at a major Siemens conference in Budapest, Hungary. The economic downturn has also affected this company, bringing about some ethical issues. Attendees included all of Siemens' major clients. The conference had the name Ascend to suggest leading at a higher level. So, what can we learn going forward? How do we operate in a more ethical way? European companies call it the three Ps-- people, profit, and the planet (the environment.). Companies today have much interest in these types of things. Some people will not get it. I am talking about people who evaluate their life on their performance and the opinion of others. They keep score on how much new money they make. Enough is never enough.

 

EL. Who are the leading-at-a-higher-level CEOs whom you admire?

 

KB. I wrote one book with Garry Ridge, the president of theWD-40 Company, called Helping People Win a Work: A Business Philosophy Called 'Don't Mark My Paper, Help Me Get an A.' He is a good example of a CEO who leads at a higher level. I am also writing a book with Colleen Barrett who just stepped down as the president of Southwest Airlines. This amazing organization leads at a higher level. Bill Pollard, president of ServiceMaster, exemplifies another CEO who leads at a higher level. I have been impressed with the president of American Express Ken Chenault. He has gone through good and bad times with American Express. I am excited about Meg Whitmore, the former CEO of Ebay.com, who plans to run for governor of California. The California governor's race needs a candidate who knows something about business and who can take a leadership role. Some of these folks, including Obama, need a course in economics.

 

EL. What role does technology play in the ability to lead at a higher level?

 

KB. We have to look at technology in a positive light. A catalyst for Obama's presidential win included his ability to lead at a higher level. He had an honest desire to talk openly to people in other countries. He ran a 2010 campaign, while Clinton and McCain both ran 1990s campaigns. Obama twittered people and he also sent them email. He used technology to keep the communication open. I try to do the same. For example, every morning I leave a message for everyone in our company. I function as the chief spiritual officer and energy officer. I praise people. I also leave a conventional message about our vision and values. People can hear in on the voice mail and receive it via email. Now I also use twitter for communication.

 

I do not think electronic communication, however, should always function as the first line of communication. People ought to get away from their desks and talk to people, not send email to someone in the next office.

 

EL. Can you briefly describe how you helped Nissan executives lead at a higher level?

 

KB. We have done much situational leadership training throughout Nissan. We helped them to develop a common language around performance and a way to communicate with people. In situational leadership, we always say it increases the quality and the quantity of the conversations between leaders and their people. That has been a helpful thing to them. We have done this at Nokia and American Express.

 

EL. Do these companies use any other methods besides the common language?

 

KB. I do not know enough about what they do with technology. They used us as a way to deal with people face to face. We try to get managers to meet at least once every two weeks one-on-one with each of their direct reports at least for 30 minutes at a time. The direct reports set the agenda and managers meet with their people 26 times a year. That really can have an impact. I wrote about this in the book with Ridge.

 

EL. What would you tell executives and managers about using situational leadership in order to get the most productivity from people with different skill levels?

 

KB. People often ask me if they need to be face-to-face with people to use situational leadership. The answer is 'no.' It all starts with first having clear goals. Ridge defined very clear goals for WD-40 Company employees. This process replicates knowing everything that will be on the final exam before you take it. Once everyone understands the goals and objectives, then together they can analyze their development level. This includes their competency and their commitment to do that. For example, if you deal with self-directed achievers who know what they are doing and are committed to doing it, you need to use a different leadership style than for very enthusiastic beginners. The latter become very excited about a new assignment, but they do not have a true sense of what they ought to do.  You can delegate to self-directed achievers, but the enthusiastic beginners will need direction.

 

We also use a coaching style for disillusioned learners, people who find things more difficult than they thought. Then we have cautious people who know what to do but who are afraid to do it on their own. It really helps people to decide. You might have to do different strokes for different folks. Likewise, you might have to do different strokes for the same folks for different parts of their job. It really permits people who deal with others to focus on what part of someone's job needs more attention. You also need to determine the type of attention that will work the best. Should it be via telephone, face-to-face, or email? It gives you an entire strategy for dealing with people.

 

EL. Can you provide an example of when you had to use situational leadership?

 

KB. When I was a faculty member at the University of Massachusetts, I got in trouble for supervising too many doctoral students. My students were in different levels of development in their doctoral thesis. Some people wrote better than I did. If they needed me, they would call me. I had other students who needed tender loving care once and awhile. I also had students who needed much direction and supervision. I could use different strokes for different folks. The assumption that you need to use the same leadership style with everyone is not true.

 

EL. You mentioned how the innovative use of technology helped the Obama campaign. Do you see innovation efforts in companies that lead at a higher level?

 

KB. Companies that lead at a higher level tend to treat their people as business partners. When you treat your people as business partners, you also share information with them, and create opportunities for them to be empowered and be creative. Whenever I lecture about innovation, I talk about the hourly 3M employee who developed the Post-it note. Now 3M welcomes employees at all levels to have ideas and come up with innovations and suggestions. If companies want to survive today, they need to have four characteristics:

  • customer drive because today the customer is king;
  • cost-effectiveness by managing the financial part of the business;
  • speed and agility because it excites your customers to know the person they deal with can make decisions; and
  • continuous improvement in innovation.

 

Leading at a higher level encourages the spread of innovation throughout the organization. As a result, not all brains lead up the hierarchy. Companies leading at a higher level do not use words like superior or brag about who works for whom.

 

EL. Are companies that lead at a higher level prone to embrace social media more than more traditional companies?

 

KB. Yes! These companies are constantly innovating and taking suggestions from their employees. All of the smart companies want bright Y generation types. Look at the people who ran Obama's election campaign! They were in their early 20s. We have been searching to get more young people into our organization. About 25 percent of our employees are Y generation. When we ask them to work on a problem, they usually do not go to their boss. Instead, they go to the Web and then they get in a chat room. It amazes me what they can do with technology because they grew up with it.

 

EL. What can C-level executives do to get other levels of management to lead at a higher level?

 

KB. What I call servant leadership has two parts: strategic leadership and operational leadership. Strategic leadership includes setting the vision and the values, the direction, and the strategic initiatives. This is the job of the traditional hierarchy. Operational leadership includes how you live according to the values, and how you accomplish the goals and the strategic direction. You have to turn the traditional pyramid upside down so that the people at the lowest part of the organization rise up. These folks are closest to the customers. That is the servant part of servant leadership. The strategic is the leadership part of servant leadership. Most organizations get into trouble because they become bureaucracies run by ego-driven leaders who want to keep the hierarchy alive and well for operational leadership. Everyone sucks up to the hierarchy away from the customers, and then senior management wonders why things do not work out. When you empower, you give power. People can make decisions and do things that excite the customers.

 

We did a study on which of those two leadership behaviors -- strategic or operational -- has the biggest impact on organizational success. We found that beyond 90 percent comes from operational leadership and the rest from strategic leadership. Strategic leadership is important because it starts the direction. However, your people and your customers do not know what strategic direction is. All they know is how they are treated. If you do not drive leadership throughout your organization, then you will never empower your front-line people who can get excited and build loyalty with the customer base.  The interaction between passionate employees and customers drives organizational success.

 

EL. What should executives look for in future leaders? How should they integrate older leaders with younger ones?

 

KB. Organizations should not throw out their older seasoned people, but perhaps create opportunities for them to mentor the young people. The young people have tremendous energy and creativity, but they do not always know the culture or the environment, and what they need to accomplish. You need to find ways to have these two populations value each other. Today you need to manage the present and create the future at the same time. It is not good to have the same group of people doing both tasks. You cannot send operational leaders away to plan your future. They will probably kill your future because they either become overwhelmed with the present or have no vested interested in the future.

 

Elizabeth M. Ferrarini is a technology writer from Boston, MA. Reach her at elizabethferrarini@yahoo.com.

 

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elizabeth ferrarini

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If you ask some C-level executives what they might do after they retire, you could hear something like, "I've thought about writing a book which chronicles what I learned running a major company." Unfortunately, few CEOs write management books after they retire. Furthermore, it's rare to find a senior executive who has written one while he or she is still actively on the job. Bob Seelert, the chairman of Saatachi & Saatchi, one of the world's largest advertising companies, is that rare kind of executive. He is one of the most insightful executives to emerge in this troubled business landscape. His new book, Start with the Answer, is a back-to-basics primer for anyone in a leadership capacity.

 

Seelert has been with Saatchi & Saatchi since 2003. After graduating from Harvard Business School, Seelert spent the next 23 years with General Foods Corp. where he eventually became CEO of Worldwide Coffee and International Foods. He closely observed one of the largest mega-mergers in United States' corporate history - Philip Morris's acquisition of General Foods. His career also included leading the turnaround of Topco, a grocery industry co-operative, and Kayser -Roth Corp., a leading U.S. manufacturer of leg wear.

 

Enterpriseleadership.org recently sat down with Seelert to talk about the management challenges CEOs, as well as other C-level executives, face dealing with the economic downturn.

 

EL. Why did you decide to write this book?

 

BS. A creative person at Saatchi & Saatchi told me that my wisdom set me apart from other executives he had known. After he said that, I got to thinking that, in fact, I dispense advice, council, and perspective. It's based on my collective experience. Perhaps, I know quite a bit about many things. I decided to put down the wisdom I have collected over a career that spans five different companies and 40 plus years.

 

The book consists of a series of easy-to-understand points about things that can lead to success in your career and high performance in companies. My book is drawn both from business and my life. You can pick up this book, read a few sections, and then put it down. It is biblical in that sense. That's the one comment I hear frequently.

 

EL. What are the three top lessons you learned as a CEO?

 

BS. Leadership begins at the top. Having the right person in the CEO seat can make all of the difference for a company. You can cascade that down the organization as well. Next, you always have to be open, honest, and candid and get a straight forward assessment of the facts. Some times the truth can be pretty ugly. Until you get it on the table, you are not in a position to deal with it. Unfortunately, many people do not look down the pike at the truth. It is one of the reasons they don't make progress. Throughout the book I adopted the predominant philosophy which became the book's title - Start with the Answer.  Before you go off and spend much time and money, you have to assess all of the facts about where you want this to end up. In essence, if you start with the answer, then you are in a position to work your way back to the solution.

 

EL. According to industry consulting firms, such as Gartner Group, the average CEO tenure is about four years. Why is CEO turnaround so high?

 

BS. In some cases, you may have the wrong person. He or she may not have the right vision for the company. Also this person may or may not have established the right standards of the performance expectations and may or may not have delivered against what he or she had initially proposed. He or she may or may not have unleashed the energy in the company for building the right kind of rapport and relationships with all of the employees. Impatience heightens all of these things. In this short-time world, others judge executives by what have you done for me lately? You have to deliver against what you said you would do. It's a combination of factors.

 

EL. What challenges do CEOs face in this economic downturn?

 

BS. They are coming under more pressure now. This is the most challenging environment that businesses have faced in decades. A recent article I wrote about leading in tough times lists the 10 things you need to do to lead successfully. First, you need to get the truth on the table. Make sure you start with a good cold heart assessment of the facts. Second you need to establish the right kind of standards for the new reality. You can establish a performance expectation in terms of how you will perform relative to the market.

 

At Saatchi & Saatchi, we do not know how far off the media environment will fall. We know that we want to beat whatever happens by 50 percent. That is a relatively high expectation in an assured market sense. We want to use this as an opportunity to grow our share of the market. Others include the following: Think long term but act short term. Communicate, communicate, and communicate. Do whatever it takes to get in front of your people to reassure them that you are going to lead the company to see a better day. Tough times call for extraordinary efforts by everyone in the company. Get with your customers to see how their needs are changing and how to best respond to those needs.

 

EL. What companies do you most admire and why?

 

BS. I admire the leadership of Toyota and Procter & Gamble. Toyota has done a good job of driving innovation and making continuous improvements. Even through automobile sales have fallen, Toyota has continued to add enhancements to the third generation Prius. In fact, some auto manufacturers do not even offer a hybrid. Toyota's new Venza fills a gap this company had in the market. Toyota continues to stay true to its long-terms goals of innovation and continuous improvement. Meanwhile, Procter & Gamble has reframed the value of some products to better fit the economic environment. For example, it has introduced a low-cost version of Tide. The company reminds people that Tide will help them keep their new clothes looking that way longer. This feature and benefit appeals to consumers in this type of environment.

 

EL. So what type of a balancing act do CEOs need to do in this environment?

 

BS. Despite the rough times, you have to add some people and create some new capabilities. Whenever you add people, however, you need to look at where you can reduce. Adding a new capability also means thinking how you can eliminate something you no longer need. You need to make tradeoffs in this kind of tight environment. To pay for the additional staff and capabilities, you need to think about the reductions and the elimination.

 

EL. As the CEO of a major advertising company, are you seeing your business evolving more to social media?

 

BS. Absolutely! Our world has moved from talking to people to building connections with them. We want to create information that is useful in peoples' lives so our clients will be invited in their homes.

 

EL. Can you briefly describe some of the technology trends you have seen in your career?

 

BS. When I worked at General Foods and Philip Morris, hardware and a centralized IT environment dominated the company landscape. Today, we can disburse software applications so they are closer to meeting the needs of disparate, decentralized entities. People at Saatchi & Saatchi not only need to understand technology, but to understand how it affects the way they access information, the way they lives their lives, and the way they make decisions. We have various centers of expertise that touch all of these things. You need to embed these things in every operating unit today. You cannot have a periodic get together with some center of expertise that tells you about this that and the other thing. You need to be living these things on a day-in and day-out basis.

 

EL. You prefer to talk about corporate dream as opposed to operate vision. Is that something that can be applicable to any company?

 

BS. It can be and should be. I have a story in the book called Tape Your Strategy to Your Forehead. There is a big difference between a dream and many mission statements. You should be able to express your dream in 20 words or less. People should be able to tape it to their forehead. You see a lot of vision and mission statements that go on and on. People do not have a way to quickly state back to what is this company all about. When I did the turnaround for Kayser-Roth Corp., we said our dream was to become the best leg wear company by meeting customer needs better and faster than competition through total quality. It is 20 words. It said this is what the company is all about. At Saatchi & Saatchi we want to be revered as the top house for world changing ideas to create sustainable growth for our clients. This is a pithy, meaningful statement. We expect everyone in the company to take this forward and know what the company is about. This kind of thinking energizes every employee.

 

EL. When you were at General Foods, the company went from a centralized to a decentralized structure during the acquisition by Philip Morris. How did you deal with the CEO so everything was harmonious?

 

BS. In the book I say that centralization and decentralization can be the nitroglycerin of organizations. Individually they are fine. However, together they can create some real problems. You need to be one or the other. One company highly centralized, while the other one was highly decentralized. It just never got to be a happy marriage. There was no way to bridge that kind of gap. General Foods was a matrix organization with many centralized resources, such as IT. We had ways of cross roughing them with the line organizations to get out of the decentralized needs of the various businesses. Centralization ends up often times being a one-size-fits-all environment. It is a difficult approach when your business comprised of an entire bunch of disparate business with no relationship to each other.

 

EL. What is your organizational structure at Saatchi & Saatchi?

 

BS.  We are disbursed geographically across 83 countries. In some areas we deal with affiliates. We have an entire series of company beliefs that we distribute around the globe. We start with our inspirational dream ad. Our local management and applications are highly decentralized. We will give them the beliefs, values and principals. The applications and the plans are in the hands of local managers.

 

EL. Can you describe the differences in the strategy process at the companies where you were CEO?

 

BS. General Foods had an intensive strategic planning process. In fact, it could drag on for a year and wind up being a three-inch thick book.  By the time it got done, it was time to start the next strategic planning process. At Saatchi & Saatchi, we have the entire thing down to a single page that tells you everything you need to know about our strategic direction. Most companies will never get to that type of an environment because spend too much time strategizing about the future. Instead, they should spend more time thinking about it and making it happen.

We operate on two types of beliefs - 'one team, one dream' and 'nothing is impossible.' We have an entire series of beliefs and character statement. We have the challenge to become the agency of the year in every market in which we operate. Our organizational focus includes filling the world with love marks, which is a strategy to elevate brand to customer loyalty and beyond.  We can put all of this stuff on one piece of paper.

 

The next thing we do is to put together an annual plan. We try to cascade what we call our 100-day plans throughout the company. It consists of the half dozen things you want to get done in the next 100 days. If you knock those things off, you get your next 100 days. That makes up a year.

 

Elizabeth M. Ferrarini -She is a technology writer from Boston, MA. Reach her at elizabethferrarini@yahoo.com

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elizabeth ferrarini

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After 20 years as an IT executive, including CIO, at Capital One's Financial Services division, Doug Moran decided it was time to do what he really loved - coaching and  leadership development. Moran's tenure at Capital One focused on getting his team to work with business partners to achieve business impact of IT. They carried out technology solutions and the integration of disparate technologies from numerous  acquisitions. Some of the projects had budgets up to $100 million. He admits that on occasion his goal of achieving business impact of IT took a backseat to the politics of being a CIO. Along the way, he spent much time mentoring his direct reports and other leaders. Before joining Capital One, he served as the Deputy Secretary of Health and Human Resources, Deputy Commissioner of Social Services, and Telecommunications Director for the  Commonwealth of Virginia. He began his career at Verizon.


Moran's new company, If You Will Lead, LLC, is a leadership consultancy focusing on executive coaching, executive development, and  infrastructure strategy. His forthcoming book is called, If You Will Lead: Enduring Wisdom for 21st-Century Leaders. He serves on the boards of the Virginia Children's Health Insurance Program Advisory Commission and the Better Housing Coalition.


Enterpriseleadership.org recently sat down with him to discuss the challenges of carrying out the business impact of IT and the need to mentor subordinates. Here is what he had to say:

 

EL. What does business impact of IT mean to you?

 

DM. The president of the  division that I was CIO for put everything in perspective for me when he said, 'IT isn't an overhead function. It's  essential to our operations. It's core to who we are.' His words were a sign that I made a difference in how our business leaders thought about IT.

 

It seems self-evident that if you cannot justify the business value or the business impact of IT, you shouldn't be doing it. Before I became a divisional CIO at Capital One, I was a business information officer. During my first leadership meeting as BIO, my new boss said that he expected me to think and act as a business leader. He went on to say that if I was just going to be an IT professional, he didn't want me to stay. He expected me to be able to describe the problems in business terms, not technical terms. He still expected me to be competent in technology.

 

When I acted as a member of his leadership team, I had to act as a business leader with a technology bent not the other way around. That view stuck with me for my entire time at Captial One. At the end of the day, you need to be able to quantify IT. Too many technology leaders focus on the attractiveness and the excitement of the latest toy, as opposed to the business value we must deliver.

 

EL. Can you give a couple of examples of how you created and quantified business value of IT?

 

DM. A good example is in that business group I mentioned. When I got there, I looked at the list of projects for the IT organization. I immediately cut the number of projects down to a manageable size. At the top of the list, we had a large project to deliver a new capability that would require  outsourcing  to a new vendor. We spent a lot  of time talking about this effort to the business. We started looking at the business case. The project was an idea that many people wanted to do, but we could not quantify the value.   We decided to shut it down rather than take the risk and waste significant time and money. The value we brought was avoiding a huge investment that offered questionable value for the organization. This enabled us to focus on higher value projects.  This reinforced that my role was not just about delivery new capabilities.  IT was also about managing risk.

 

Before I left Capital One, I worked on replacing our lending platform. The acquisition of a couple of different banks gave us the challenge of how to deal with different platforms all doing the same thing. We said, 'Here is what it costs today. Here it what it is going to cost if we continue to operate with these disparate systems. It’s not just  the hard cost of running them, but the missed opportunity of an  integrated  customer experience.' We put together a compelling case and wound up replacing the system  three years before we had intended. We showed that this effort made  sense. It was controversial. It required the business to go through  change that itt did not want to embrace.

 

EL How did you communicate business impact of IT to your constituents?

 

DM. We used their language or terms to build a business case that was grounded in the business metrics that the business unit valued. We had regular meetings. Each of the CIOs who reported to me had to become an integral part of the business they served. They were at the table, attending all of the meetings. They had to work closely with our business partners to help them understand all of the issues. When it came right down to it, my team's job was to learn the problems the business was experiencing and be part of solving them. There were the natural business things that occurred. When we got together to figure out what we wanted to do, we would have meetings to prioritize and make sure we got access to the technology professionals we needed to solve the problems.

 

EL. Did you handle the politics of being a CIO?

 

DM. I tried to minimized the politics by keeping the end game in mind. If you deliver business value, then the politics can work themselves out. Often politics become an excuse to   rationalizef why certain projects cannot get done. On occasion, I would run into that problem, and I would fall back into that excuse saying,, 'It's the politics of the systems that keeping mefrom getting the resources I need.’ The fact was, I could not make the case for showing what I needed to get done was more important than other people's projects.' I have spent much time looking back at what went well and what did not go so well. I often blamed others for not getting everything done. In a most cases, I had not done the best job of figuring out how to put the most compelling case before the appropriate stakeholders.

 

EL. As a CIO, what did you look for in staff?

 

DM. I looked for people with a good work ethic, and strong technical skills. Capital One has a culture of rigorous testing and assessment. We did much screening before we hired anyone. As a result, I knew that the people I interviewed had made it through a tough  process. I also looked at peoples' creative abilities and willingness to think about problems in business terms, not as a technologist. I wanted my direct reports to be very business savvy.

 

EL. Did you do any type of mentoring to help your staff improve the raw skills you were looking for?

 

DM. I am a great believer in mentoring. Capital One invested much money in enterprise training. I invested much of my time in mentoring and developing leaders on my team. The love of mentoring inspired me to set up my company. Of all the things I have done, mentoring and coaching made me the happiest.

 

EL. Are you glad you are longer a CIO in an organization?

 

DM. I am glad to be doing what I am doing. I loved being a CIO. At times, it frustrated me. At the same time, I found it to be very rewarding. Unfortunately, my role became too administrative, where I focused more on making sure that the businesses underneath me did things correctly, as opposed to being a thought leader and driving business.

 

EL. Can you describe your forthcoming book, especially why you decided to write it?

 

DM. I have based my leadership book on Rudyard Kipling's poem, IF. Kipling’s poem described 16 attributes required to be a man. When I rediscovered this poem in my late 20s, I realized that it was a simple set of rules for being a better leader and a better person. I have used it in my personal development since then. About six years ago, I started introducing it to people I worked with, especially people I was mentoring.

 

The book takes the same 16 attributes in the poem and looks at leaders from history who have used at least one of them. I have written a chapter about each of those leaders and the lessons we can learn from them. The first line of the poem says, 'If you can keep your head when all about you are losing theirs and blaming it on you.' As a leader, you need to have composure and to be able to maintain it in tough times. I wrote about George Washington during the early days of the American Revolution. Each chapter has a different leader associated with it. I encourage people to ask, 'How can you learn from this person? What can you do differently to maintain composure or to demonstrate the characteristic that makes a strong leader?' That's the essence of the book.

 

People who want to be leaders must decide to make that investment themselves. The book's introduction says that the content is not for people looking for a quick fix. Instead, the book is for people who want to invest the time and energy to do it right, recognizing that being a leader is just as important as investing in any technical skills.

 

EL. Are you currently mentoring any IT colleagues from Capital One?

 

DM. I still mentor people at Capital One or people who have left and gone on to other jobs.

 

To be a CIO, you have to be credible in the IT community. You also have to be credible to the business. A former colleague and I often debate which comes first -- the business side or the technical side. At the end of the day, the IT folks need to know that you are one of them and the business folks need to know that you are one of them as well.  I help people shift gears to remain authentic with whoever their audience is.

 

EL. What are you perceptions of young people coming into IT today?

 

DM. They are so anxious to get ahead  now. They are always looking for the next promotion or the next opportunity. They are the hungriest and most aggressive group I have ever seen. I always encourage them to take their time, learn their skills, and grow them in a reasonable way. The ones who are not doing this are burning out.They often not have the foundation beneath them to support themselves. We are seeing a mixed bag of young people. The most successful ones I have seen are those that really love the relationship between technology and its ability to enable business growth. If you want to work in financial services, or any other industry, you need good technical skills, but it is more important that you understand how technology will enable the business to deliver results and create value. Sometime people who I mentored wanted to be pure technologist.  They really loved the technology. I would often encourage them to follow that path by going to pure technology firm where their skills and passion would be most appreciated.

 

I am a big fan of off-shoring. It has enabled significant changes in the IT field. It is also presenting challenges for young IT professionals. Today’s young people are competing with some of the best talent from across the globe. The talent coming from offshore firms, especially India, is exceptionally strong. As an IT leader, my challenge was finding ways to attract and grow both in-house IT talent and off-shore talent. That really requires balance.

 

Elizabeth M. Ferrarini - She is a free-lance writer and IT consultant from Boston, Massachusetts. Reach her at elizabethferrarini@yahoo.com

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Tom Parish

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Bill George, currently a management professor at Harvard Business School, has spent the past decade researching and writing about the authentic approach to leadership. It's about understanding your motivations, orienting your moral compass, building your support team, empowering others to lead, and staying grounded by integrating all aspects of your life.

 

George has the right credentials to write as an authority of authentic leadership. Inspired by Medtronic's mission to restore people to full health, George joined the company in 1989 as president and COO. He became CEO in 1991. Under his 10-year leadership, Medtronic's market capitalization grew from $1.1 billion to $65 billion. In 2003, he wrote the best-selling book, Authentic Leadership - Rediscovering the Secrets of Creating Lasting Value. He followed this book in 2007 with True North: Discovering Your Authentic Leadership, which includes vignettes of executives who demonstrate an authentic leadership style.

 

George is on the board of Novartis, Goldman Sachs, and ExxonMobil. His articles have appeared in the Harvard Business Review and U.S. News and World Report, and many other business publications.

 

Enterpriseleadership recently sat down with Professor George to discuss what it takes to be an authentic leader, who are and who aren't examples of authentic leaders, and what challenges a CIO faces in becoming an authentic leader, and how governance must change to support sustainable innovation.

 

EL. What were your  criteria for the executives profiled in True North?

 

BG. The idea for the research came out of Authentic Leadership where many people wanted to know how to become an authentic leader. We interviewed 125 leaders who we felt were authentic and successful. Measuring authenticity is hard to do. We want back over the interviews and measured our qualitative judgment of their authenticity. Part of our criteria looked at people in all age groups. We had a minimum of 15 people per decade, ranging from more than 20 on up to more than 70. We wanted to get the age dispersion to see what, if any, differences existed between the emerging generation and the older generation.

 

EL.  Did you look quantitatively at what type of success some of the authentic  leaders profiled in the book had?

 

BG. To do quantitative research, you need to look at things over a long period. For example, some people asked why we used Jeff Immel, CEO of General Electric, when the company's stock hasn't gone anywhere. He's looking at long-term restructuring.  He's doing a good job. 

EL. Is values-based leadership the same as authentic  leadership?

 

BG. Authentic leadership encompasses values-based leadership. Authentic leadership goes beyond that, but it certainly requires values-based leadership, especially a sense of purpose, an ability to lead with the heart, which includes having a passion for the work you do, having the courage to make tough calls, being able to build long-term relationships that get the best out of other people, and having empathy for your employees.

 

EL. Some companies, like Oracle, have had a high turnover in executive talent. What would you say about the leadership style of a CEO who runs a company where this is happening?

 

BG. These executives would be at the opposite end of the spectrum of what we're describing as authentic leaders. These leaders can be aggressive and manipulative. Oracle has had good people, such as Ray Lane, building the company. Oracle has grown by aggressively acquiring companies, such as PeopleSoft and Seibel Systems.

 

EL. Jack Welch, the well-respected CEO of General Electric, supposedly has a tough personality.  Would you say he is an authentic leader?

 

BG. He's right in the middle. He did some fantastic things at GE. He transformed GE in a way that the leaders of parallel companies, such as Westinghouse, Seimens, and Phillips, were unable to do. You have to admire what he did. He has a very rough style, but he has the ability to get the best out of people. He makes people feel like he really cares about having them perform. In the end, his on-the-job values are very sound. He made tough calls about removing some people whose ethnics were questionable.

 

EL.  Is Steve Jobs, CEO of Apple, an example of an authentic  leader?

 

BG. He's a very difficult case. He has learned from his crucible.  It's obvious that he never had formal training in leadership or management. He had a failed marriage with John Sculley. Jobs went off and formed another company, and he's very well with it.  Now he has come back to Apple where he's doing amazing things. He's a good fit for the Apple culture. He, however still has an arrogant streak. On the other hand, Jobs is an incredible innovative leader who transformed a company with no marketing. Look at what he has done with the Ipod, with the iMac, and now with the Iphone. This country needs people who can innovate and create new things.  He has shown sustainability in creating innovations. Most people are like a one trick pony which can't come up with another exciting product.

 

EL. Where  does Carly Fiorina, the former CEO of Hewlett-Packard rank on the authentic  leadership scale?

 

BG. For 40 years now, HP has been my role model for how you run a company. HP became the role model for companies such as Medtronic and others. HP put her in the wrong position. Lew Platt, her predecessor, used to fly commercial, and Dave Packard drove an old car to work. These people used to hang out in the cafeteria. She brought an elitist style, which didn't fair well with employees. She focused a lot of time outside the company. She lost the hearts and minds of the engineers who are the real innovators. Other innovators, such as Bill Gates, stay close to their creative people all the time. She would have been better off staying at AT&T. The bottom line is that she didn't connect in the Silicon Valley, highly creative culture. Mark Hurd has come in and connected, and, as a result, turned HP around very quickly. I wouldn't say she's authentic. She seems to be more focused on the external world.

 

EL. Can you give an example of a CEO who is an authentic leader and describe what this person has done to create an authentic organization?

 

BG. Authentic leaders have to be very consistent and true to the roots of that organization.  Take a man like IBM's Sam Palmisano. He has taken IBM right back to its roots in the very best sense. He is also moving IBM forward into the future. He has put in an amazing program in place called Leading by Values. It had a 72-hour online jam for 350 people.  Everyone said what values the company ought to have.  The values aren't unique, but the commitment is. He was taking it from a task-oriented organization to a true values-centered organization. His philosophy is that we have to act as one organization all around the world.  This down-to-earth guy has really achieved this. He has come up from the ranks at IBM, working in just about every aspect of the company. He spends a lot of time with the engineers just tracking their innovations. He is very passionate about going into emerging markets.

 

EL. As the former CEO of Medtronic, you know that CIOs have to balance the interests of IT with those of the business units. What challenge does this place on CIOs who want to find their authentic leadership?

 

BG. This is a huge challenge for some CIOs. About a decade, ago many CIOs were spending too much time trying to build their own empires. The emergent CIOs and CEOs really understand how to use information as a strategic weapon to better their business. Take Dick Kovacevich, CEO at Wells Fargo. He has been the most successful banker for 20 years.  He went away from all of the commercial banks using IT to cut costs and to take people out. He, instead, said we want to use it to make our front-line people more effective so they can better service customers with all of the bank's offerings. He saw the opportunity to have all of the customer profiles online. He did it very well. On the other hand, CitiGroup, a larger bank, never could ever do this. You can't even figure out how to get the status of your credit card.

EL. You co-authored a book called, Mastering Global Corporate Governance. If a company wants to improve its sustainable innovation initiatives, how should it modify its governance model?

 

BG. Boards of directors have been asleep. They need to get engaged in the important elements of the business. The governance model is to focus first on leadership succession and second, to look at how well employees focused are on handling customers.  They need to look at the numbers third and then all of the other formalities.

 

The boards I'm on do an outstanding job of that, but I lot of boards haven't. The Target board focuses heavily on the needs of consumers. This board which has four women reflects the needs of its key consumers, namely women. The Target board has always been asking tough questions: How well have we been serving the Hispanic market? Are we meeting the needs of young people? Do we use IT effectively so that our merchandise is fast flowing and we can turn it over quickly? If you look at the results, you'll see how well Target has used it IT systems.

EL. How would you rate the leadership styles of most CEO  of Fortune 1000 companies? Are they authentic leaders?

 

BG. A big change is taking place today among CEOs. My generation, people who are in their late 50's and 60's, didn't do a good job. I call these the pre-Enron CEOs. They focused too much on the trying to meet the short-term needs of the stock market. As a result, they destroyed many great corporations.  I'm speaking of the old AT&T, the old Sears Roebuck, and the old General Motors. These were once great corporations. They are virtually out of business or hanging on for dear life. Their CEOs weren't authentic. They weren't corrupt people, like Enron or WorldCom.  They didn't really build their companies for the long term. You can see this in the pharmaceutical industry. Great companies, such as Bristol Myers Squibb, have lost their position.

 

Today's CEOs are very different. They know they have to meet the short-term needs. However, they're trying to build organizations for the long term. For example, Anne Mulcahy has brought Xerox back from the brink of bankruptcy. The same goes for Andrea Jung at Avon. These are examples of outstanding CEOs. A.G. Lafley's predecessor at Procter & Gamble turned the company against it culture. Lafley has created an incredible corporation. There is a whole generation of very authentic CEOs, including some very young ones.

 

EL. How have governance models in Fortune 1000  companies changed?

 

BG. They are changing, but there is too much emphasis on regulations, such as Sarbanes Oxley. These are your ministerial duties. Boards aren't changing fast enough. Worrying about today's leadership and tomorrow's leadership should rank number one of their list. They aren't doing that. They aren't engaged enough and knowing who the people coming alone are. They're more concerned about who would replace the CEO if he/she were hit by a bus. They get into a panic and have to go outside the organization to recruit. The chief operating office should be thinking about leadership succession. If the COO isn't doing it, then the board has to insist on it. Everyone needs to get to know the candidates by seeing them off site, or seeing them on the job. Jack Welch did this very well. He suggested that the board go visit Jeff Immel on site when he was running GE Medical Systems. Boards that do their job get really engaged with who the leadership is.

 

I'm on the board of Goldman Sachs. When Hank Paulson, the former CEO, decided to become Secretary of the U.S. Treasury, we moved faster than we anticipated. Fortunately, Lloyd Blankfein had been groomed. We knew him very well. We also knew the people coming up behind him.

 

Resources

Authentic  Leadership Book Review
PBS Interview With Bill  George
True North Web  Site
Strategy  + Business Interview with Bill George

 

Author: Elizabeth M. Ferrarini - She is a technology writer  from Boston, Massachusetts. Reach her at elizabethferrarini@yahoo.com.

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Tom Parish

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Gerald Shields, CIO of Aflac, the $14 billion disability insurance company, believes in the power of continuous learning for his IT directors and managers. In fact, his lunch hour book club doesn't read books about IT, but about leadership. His book list often includes the works of Noel M. Tichy, a professor at the University of Michigan Business School, and director of the School's Global Leadership Development Center. Both BusinessWeek and Business 2.0 have rated Tichy as one of the Top 10 Management Gurus in the country.

 

As the former head of General Electric's Crotonville Leadership Development Center, Tichy packs his books, such as  The Leadership Engine and The Cycle of Leadership, with plenty of management insight from General Electric. He also co-wrote the best seller, Control Your Destiny or Someone Else Will. Recently, enterpriseleadership.org sat down with Professor Tichy to talk about his recent book, Judgment: How Winning Leaders Make Great Calls. Here's what he had to say:

 

EL: What judgment challenge does a functional leader like a CIO  have?

 

NMT: Functional leaders, such as CIOs and CFOs, have a dual role -- a lead role and a supporting role.  They run an organization. CIOs run IT. They have to make judgments about people, strategy, and crisis. They also have to support the line organization, which has to make better judgments.  You have to be conscious about what makes good judgment.

 

EL:  When should someone begin to go on the journey of  self-understanding?

 

NMT: In my ideal world, it ought to start as people are growing up. Immelt's intense journey began when he was starting to run the major appliances business unit at GE in the late 1980s.

 

Good leadership requires a good self-understanding. The good leaders, such as A. G. Lafley, CEO of Proctor & Gamble, are reflective. They're actors who can also reflect. Welch had an amazing ability to move fast and to make good decisions. He'd also have down time where he'd write and he'd reflect. A lot of leaders act and don't reflect. If you don't have some of that self-reflect time, you'll have a hard time making good judgments.

 

EL: Why did Carly Fiorina, the  former CEO of Hewlett-Packard, have trouble making good  judgments?

 

NMT: Carly Fiorina's problem was her background.  She never ran a true profit and loss business.  This experience requires you have to make tradeoffs in marketing, sales, and manufacturing. Lucent flew high before the dot.com bust. She sold switches to executives at eight companies, such as Ameritech and Verizon. These executives moved millions and millions of dollars of switch gear. That's not running anything.

 

If you wanted to develop her as a leader, then you'd put her in a true P&L situation. You don't go to the major leagues without first playing in the minor leagues. She was at risk the minute she walked into HP. She could argue that Mark Hurd has gotten credit for all of the great things she did.
There's some truth to this. She did accomplish some significant things. The Compaq acquisition is paying off. Mark Hurd had plenty of minor experience at NCR, which is not as large as HP. He, however, had true P&L experiences in his career. He really understood operationally how to run an organization that had manufacturing, engineering, and marketing. He knew how to make tradeoffs.

 

EL: When you ran the leadership development program for HP, did you see Carly Fiorina make frequent appearances as Jack Welch did at Crotonville?

 

NMT: I saw a good example of her failing to connect with employees, especially future leaders. When she first joined HP, I was running HP's leadership development program for upper middle managers. About 30 HP employees at the time would attend a four-day workshop at the University of Michigan, and then return for a three-day workshop after 100 days. At first, the women said they were happy to have a female CEO. At the end of three months, these same women gave Fiorina low marks, saying she didn't relate well to people. They said she was arrogant and standoffish. She never came to the program once. Jack Welch or Jeff Immelt visited Crotonville regularly. You couldn't keep then away.

 

EL:  Can you briefly describe what you mean when you say a good leader needs a  teachable point of view?

 

NMT: In the Leadership Engine book I laid out the four components of a teachable point of view. First, create business ideas that will drive shareholder value. Second, determine the values you want people to live by in the organization. Third, learn to energize people so they buy in and support the values and business ideas. Fourth, have the courage to make yes/no decisions. If you don't have a set of values people can model their behavior by, then you'll create more Enron's, Imclone's, and Tyco's. I've been talking about this for the past 15 years. It's just part of being a good leader. Every so often, we have to remind people about it. A good organization has always had a strong set of values.

 

EL: Several years ago, Fortune magazine did an article describing how a new management paradigm is replacing the venerable Jack Welch style. What's your assessment of this?

 

NMT: I know Jack Welch very well because I worked closely with him. He used to visit GE Crotonville once a week. All of my books have chapters filled with tremendous insight from GE. Many people who write about Jack Welch have never met him or even worked at GE.

 

Welch was a very collaborative team builder beginning when he was a hockey player in Salem, Massachusetts. He built an incredible team for 17 years in plastics. He knew how to build gangs and groups of people. He introduced workout, which took layers out of the organization. 

 

He developed more leaders than any other CEO in the history of business. Jim McNerney now runs Boeing, while David Cody runs Honeywell. Robert Nardelli, who messed up as CEO of Home Depot, now runs Chrysler. About 30 leaders developed by Jack Welch run Fortune 500 companies. That kind of record of accomplishment doesn't happen by beating up on people. He was an incredible coach. He spent 30 days a year on succession planning. He was tough on business matters, which explains why GE succeeded and Westinghouse didn't.

 

EL: When it comes to making good judgments, do many  leaders put a lot of weight on analytics?

 

NMT: I don't know to what degree companies today rely on analytics. You have to look at the history of analytics, which goes back to GE in the late 1960s. GE developed the PIMS database. Things like, strategic planning and systems thinking, originated at GE. When I started as a graduate school business professor in 1972, we immersed ourselves in analytics. Over the years, we learned that business schools had oversold analytics as being able to lead to the answer. Analytics comprise one part of the puzzle. For example, before making a patient diagnosis, a physician compiles analytics from all the tests the patient took. At the end of the day, that physician has to make a judgment.

 

Some organizations, however, do rely heavily on analytics to provide answers. On the other hand, you shouldn't just wing it. Good judgment requires two things:  as many analytics as you need to frame your decision, and the courage to take a leap of faith.

 

EL: What was your most interesting assignment at GE's  Crotonville?

 

NMT: Developing the next generation of leaders turned out to be my most interesting assignment at GE. In 1986, Jack Welch said because the world had changed and because the business had changed, the way we developed leaders in the past no longer applied. We had to look at the leadership pipeline from 22-year-old campus hires to future CEOs. Eighty percent of development happens on the job and in life experiences. Crotonville, however, will never go out of business.

 

For example, how do you help a 22-year-old bench engineer develop an awareness of his or her own values, the values of GE, the work planning tools, and a combination of both the soft people skills, as well as the hard business issues? What happens when that same person becomes a 28-year old manager of seven other bench engineers? He or she has to learn, not only what their values are, but also how to teach those values to other people. They need to learn how to manage a team, and how to do appraisals.

 

When Jim McNerney ran GE's aircraft engine business, he oversaw 40,000 employees. He had the challenge of teaching those people the appropriate company values. If you're in a similar situation, you need to say: How do I set a strategy in a business and in an industry? How do I deal with the types of conflicts that come up in a unionized shop? At every level, you start thinking through. You then say what are the developmental experiences you need to give people? What formal experiences can accelerate what you actually can imprint on people?

 

EL: What advice do give your consulting clients about  succession planning?

 

NMT: Whenever I work with clients, I tell them to forget about what path they used to take to the CEO post. They, instead, need to examine their business and their environment. From this, they can determine how they can develop people.

 

EL: How well do Fortune  1000 companies handle succession planning for C-level  leadership?

 

NMT: Terrible! Whenever you need to go outside for a CEO, you've failed. HP went outside twice. 3M went outside twice and failed. Merck failed. Home Depot is on its second outsider. Citigroup was lucky to have someone inside. Succession planning ranks at the top on a CEO's and the board's list of responsibilities.  It should be number one. Most major companies don't have many prospective candidates in the succession pipeline. We mention this in Judgment.

 

There are some wonderful exceptions to this dilemma. Indra Nooyi, CEO of PepsiCo, came from in house.  A.G. Lafley at P&G came from in house. GE can produce a surplus of leaders.  The minorities of companies that have done it successfully had succession planning in their DNA from the start.

 

Author: Elizabeth M. Ferrarini - She is a technology writer  from Boston, Massachusetts. Reach her at elizabethferrarini@yahoo.com.

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Tom Parish

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When Jerry Batt was CIO at Sprint, he didn't worry about delivering the technology the company needed; Sprint used most of the network technology it developed. He worked collaboratively with the business units to provide them with the appropriate IT services.

 

Batt found himself in a unique position after he became CIO at Pulte Homes, the second largest residential homebuilder in the U.S.

 

The growth in home buying from the 1990s to 2006 caused Pulte to break into the Fortune 500 list with $15 billion in revenues. At the same time, homebuilding ranks at the bottom of industries that make investments in mechanization and automation. To this end, the business units at Pulte looked to Batt to spearhead the development of applications and technologies the company needed to ride the home-buyer boom. Pulte's investment in IT innovation helped it to pioneer several firsts in the homebuilding industry. Homebuilding is, however, is a cyclical industry. With the 2006 downturn in home buying, Batt had to shift his management style to keep up the momentum in IT innovation, and to maintain the IT staff morale.

 

Enterpriseleadership.org recently sat down with Batt to discuss how he has successfully directed IT through some dramatic changes in his company's marketplace. Here's what he had to say:

 

EL: Can you provide a little background information about what makes Pulte Homes unique?

 

JB: Pulte is in a national production homebuilder. This class of homebuilder emerged 10 year ago through industry consolidation. We cracked the Fortune 500 list in 2003, and our sales peaked in 2006. The company is immune to foreign competition, which has been both good and bad. It doesn't stimulate dramatic improvements or innovations as has happened in other industries.

 

We still build houses one stick at a time, regardless of the economic market segments. Last year, we built about 46,000 homes.

 

EL: With the current downturn in the marketplace, what is Pulte's direction?

 

JB: We want to build the highest quality product for a base price. Because of our national purchasing power, we can acquire those amenities a homebuyer might upgrade to after a few years. For example, we've upgraded our quality of our carpeting several levels, but we provide a smaller number of choices. The national program we have with our carpet supplier enables us to buy high quality carpeting for less money than we normally could. The bottom line is that we can offer a complete package, thus reducing the complexity of choice, the opportunity of mistakes, and the increased costs of maintaining all the inventory.

 

EL: Where was Pulte headed when it realized it really needed to innovate in IT?

 

JB: From 1999 to 2003, Pulte had been growing 30 percent a year and selling about 30,000 houses a year. All of the wheels seemed to propel our business's growth faster and faster. Our CEO was going around the country selling us on the idea of building 70,000 homes year.

 

After looking at the entire homebuilding business flow, we picked an innovation model that lent itself to an asset turnover business. We buy land and entitle that land to be subdivided into buildings lots, ranging from 100 homes to 1,000 homes. So, we build homes, sell them, and then move on to the next piece of property.

 

In 2003, we realized that we could no longer operate with a spreadsheet mentality. We'd put most of our product information on an Excel spreadsheet. That's how we forecasted sales and did our planning. We took the business workflows and started to automate them, one at time. Because we had no legacy systems, this process was straightforward, and we used a lot of Web-based technology. We had to hire people to build new applications and to modify existing applications. Homebuilding hadn't attracted a lot of third-party software vendors -- Microsoft and Oracle couldn't offer us much.

 

EL: What else did you automate, or are planning to automate?

 

JB: We added a scheduling application and a selection application to a basic ERP system. The selection application enables us to keep track of what colors and options -- such as carpeting or hardware floors – a customer wants in their home. We automated some parts of our supply chain, and a year later, we automated our sales-force tools based on Seibel. We were also the first in the homebuilding industry to automate our purchasing nationwide; we rolled out this application one city at a time. We're now looking to automate the tracking of our land. We also aim to create a more transaction-based Web site. E-commerce is not the norm for our industry.

 

EL: How did you get prepared psychologically to deal with the downturn in the home buying marketplace?

 

JB: I've lived through cycles like this four times in my career. You need different leadership skills for both the upside and the downside of things. Most of all, you need to know when to shift to those skills. When the market started to slow down in 2005, our IT activity also followed suit. We had to scale back on projects and on staff. That's when I knew it was time to shift gears.

 

Ironically, the homebuilding industry had weathered the recession of the early 2000s. During our 12-year growth spurt, our senior leaders had never seen any downturn. They'd filed away in the back of their minds the possibility that it could happen. Coming from the telecom industry, I was cynical about how long a company could hold on to a good market. I said, "What are going to do when things change?" They looked at me in disbelief. We weren't mentally prepared for a downturn.

 

EL: So what is your leadership style when things are going great?

JB: When you're growing, you're simply trying to add resources -- people, hardware, and software -- in a way that makes sense. It's hard to add scale without losing control of the integrity of all of your processes, including people processes. You need to discipline yourself so you won't adopt every new technology that comes along. You need to impose quality disciplines so you can maintain order in the way things get done.

 

EL: What is your management style through a downturn?

 

JB: The downturn is a different animal. It's affected by the company culture and by the prospects for it being only temporary, and not structural. I had to do massive cost reductions in places that didn't have an immediate hope of recovery.

 

It's a different mindset when you think you're going to be back in the game soon. When it comes to management techniques, I found that you need to earn the trust and the engagement of your people. Some will loose their jobs. I've made in a practice to tell people where the business stands. At our all hands monthly meetings, I try to make sense of the marketplace. Unfortunately, IT people have a tendency to not look up until its too late. These days, I've been describing the sub prime mortgage problems to them. This process helps them to understand why the IT project list has shrunk dramatically. I also tell them if we're going to do a layoff, they'll know well in advance. By being forthright, I realize that some people might bail out prematurely and our HR might get nervous. That's the risk I'm willing to take.

 

EL: How is your governance process different at Pulte than it was at Sprint?

 

JB: At Sprint, my job as CIO was to build consensus with the business units all of the time. In other words, we had to get everyone to agree on a compromised plan before we could move forward.

 

At Pulte, people look to me to provide the technology direction. They have far less knowledge, insight, and interest in participating in technology decisions, such as the software to be used and the vendor selection. They still, however, want to know the outcome or the results of a project. Because I'm still allocating resources to scale the business, my governance model is for me to understand the needs of the business. I talk to everyone. At the end of the day, I can recommend what projects will move forward and what won't. I work closely with the CFO to determine what we can afford to do, and I work with our COO to ensure that we meet our operating priorities. There is a lot of autonomy in this particular structure.

 

EL: Most CIOs would love to have more leeway in making recommendations -- what's the downside?

 

JB: If it doesn't work, you, and no one else, must take the blame. I was so used to collaborative relationships at Sprint, that I underestimated what it took to fly solo. While we were putting in an Oracle ebusiness platform in one of our light manufacturing sites, I mistakenly thought it was a joint project between IT and the manufacturing folks. I was one-third through the project when I realized that these folks expected me to drop this platform in without their help.

 

EL: What's the difference between IT alignment at Sprint versus Pulte?

 

JB: At Sprint, technology was an integral part of the business. I was responsible for the network and all the infrastructure that went into it. The IT components were highly integrated. That's not the case here. At Sprint, we had many people involved in aligning IT. Here's we have five senior executives and I driving it.

 

EL: How are you developing senior IT people?

 

JB: Because we're in the downturn, I'm mostly retaining them. Unlike their predecessors, the younger IT professionals focus a lot on self-fulfillment. The trick to holding on to them is to keep them motivated and energized according to what turns them on. For example, we did a press release for one IT professional who did an outstanding job on a project. He was excited about getting national attention and putting this recognition on this resume. I knew that we risked making him visible to a lot of search recruiters, but we gave him what he needed. Everything we said in the press release was genuine.

 

Now we're identifying the top 15 percent of our IT contributors and developing personal reach-put programs that will be based on what we need to do to make these contributors feel valued.

 

EL: What quality standards do you have in place at Pulte Homes?

 

JB: For about a year, I worked with a professor from Virginia Tech to develop a quality standard. One of the divisions at Sprint won a Baldridge quality award. So I decided to take a little Baldridge and a little CMMI. I'm thrilled with the outcome. Our quality standard is largely a continuous improvement one built on many of those same platforms. We're now teaching it to people.

 

Before I went in this direction, I assumed that everyone at Pulte had a basic understanding of things like customer-supplier model. I was wrong. Every time I asked this question during meetings, I got blank stares. I realized that we had to go back to fundamentals. Our quality standard includes the history of how software quality improvement has matured. We're designed the course around Steven Covey's Seven Habits of Highly Effective people, which serves as a cultural foundation for the standard.

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