Successful CEOs share 3 attributes: Consultant

Realistic optimism, subservience to purpose and finding order in chaos qualities of great leaders
By Sarah Dobson
|Canadian HR Reporter|Last Updated: 11/01/2011

In August 2003, Courtney Pratt, then CEO of Toronto Hydro, was in an audit committee meeting when the lights went out. It quickly became apparent Ontario and most of the northeastern United States were suffering a major blackout. Electricity was cut for 50- million people.

At the time, Pratt didn’t quite know how to respond. He didn’t really understand electricity, he said, and was unclear on what exactly was happening — and desperate calls were quickly coming in from the likes of Air Canada and hospitals faced with emergency generators that needed gas.

Fortunately, Pratt’s team was calm and cool — they knew what to do and they had practised, said Pratt, speaking at a seminar held by the Human Resources Professionals Association (HRPA) in Toronto in September. And he knew he needed to stay with the team.

“Just the fact I was there sent a pretty strong message.”

During the crisis, Pratt put a priority on keeping staff focused and delivering messaging to the public. His role was to provide leadership, work with the experts and be the public face by being “up” all the time.

“It was exhausting,” said Pratt, who is now a chairman at Knightsbridge Human Capital Solutions in Toronto.

Faced with a hastily assembled press conference with the mayor, Pratt knew he had to encourage people to conserve energy when the power started returning. So he came up with a sports analogy, comparing the first period of a hockey game to the first moments of the blackout, the second period to gradually bringing back the power and the third period to bringing everything back on. Let’s avoid going into overtime by working together, Pratt said.

This kind of fortitude and resourcefulness during a crisis situation is a big reason why successful CEOs are so successful, according to Justin Menkes, author of Better Under Pressure: How Great Leaders Bring Out the Best in Themselves and Others.

In a world of volatility and globalization, there will never be calm seas again, he said.

“Winners in the new normal have to thrive, use that pressure to thrive, push themselves, achieve things they couldn’t possibly imagine.”

Some leaders deliver their greatest success when times are the toughest and in interviewing 60 CEOs for his book, Menkes found they share three attributes: realistic optimism, subservience to purpose and finding order in chaos.

The first is the most confusing but in a world of relentless obstacles, a leader should have hope — as long as it’s not blind optimism, said Menkes, who is also a consultant at executive search firm Spencer Stuart.

“Nothing loses the credibility of the 21st century workforce faster than blind optimism — they need to hear the truth,” he said, adding the Internet age has made that even more relevant as people can find out almost anything online. People need to trust their leader, see her confidence and learn the practical steps she will take to meet goals.

3 CEOs demonstrate 3 attributes

Menkes cited Chris Van Gorder, president and CEO of Scripps Health in San Diego. Van Gorder was a police officer until a bad accident put him out of commission and it took him three years to walk again. He landed a job as a security officer at Scripps and slowly worked his way up to become CEO.

The company was dysfunctional and low-performing but is now a successful organization made up of four acute-care hospitals. And when new employees arrive, Van Gorder always gives them the same lecture. While the workers will want responsibility and praise, they won’t ask for accountability, he’ll say, but there are budgets that have to be met and health care is hard, so he teaches about responsibility and being confident to find a way to make things happen — realistic optimism, said Menkes.

In looking at subservience to purpose, Menkes cited Herb Kelleher, founder and retired CEO of Southwest Airlines. Originally an attorney who was fired because he didn’t bill his clients enough, the chain-smoking, Scotch-drinking man turned everything he did “into a noble, passionate purpose,” said Menkes.

It took Kelleher seven years — and two trips to the Supreme Court — to start the airline as the industry was highly regulated and the competition was opposed to such an intrusion. Today, Southwest outperforms competitors with higher retention rates and high performers because employees believe in their jobs and the work they do, said Menkes.

“You have to be able to translate your vision into more than just making money,” he said, and if your people believe, it gives you a powerful advantage.

A.G. Lafley, chairman and CEO of Procter & Gamble, helped exemplify the last attribute: Finding order in chaos. This leader is continuously trying to solve puzzles as a way to drive success, said Menkes.

For instance, he once went on a business trip to Brazil and, in between meetings, went down to the river to watch women doing their laundry.

Lafley was trying to understand why the launch of a new detergent for emerging markets had been such a failure. Knowing that access to clean water was difficult, P&G had created a detergent that didn’t require a separate rinse cycle — but none of the women were using it. After three days, Lafley realized the product was not appreciated because it didn’t make suds.

Human beings are incredibly complex and unpredictable, he told Menkes, and once P&G added suds, the detergent sold very well.

“The world is not going to get simpler,” said Menkes, and great leadership is defined as the ability to guide an ordinary group of people to do something extraordinary.

A workforce can be taught to thrive in a world of never-ending pressure and much of that is HR’s responsibility, he said, in finding a way to make people successful and maximize their discretionary effort.

HR should be “ready to play” in a crisis situation, said Pratt. That means understanding the people involved, the risks and the impact of the situation. HR professionals should strive to prove themselves every day so when a crisis hits, there’s no question about their abilities.

“When the pressure is on, you want to be one of the people the CEO turns to,” he said. “It’s a big burden but if you do it right, you’re doing the organization a huge service.”

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