Get Ready to be a Lonely Leader

My latest reading list is two titles by Alan Axelrod with the first being Gandhi, CEO and next on my list is Napoleon, CEO. The reason that I have chosen the two titles is to compare whether there are any distinct differences in leadership qualities between the two and also similarities. Gandhi and Napoleon offer such contrasting personalities where comparison between the two would be interesting. Gandhi is universally known as the compassionate and non-violent leader while Napoleon is sometimes labelled as the power hungry warlord and even to the extent of being called the anti-Christ. Perhaps, both amazing leaders are born out of circumstances to suit the turbulence of their respective era. I would imagine Gandhi barely surviving in the war-torn era of Napoleon and similarly, Napoleon would delights the British army if he choose the violent path if he is in Gandhi's shoes.

Anyway, I am now in the middle of Gandhi, CEO and one particular "lesson" in the book immediately strike a chord in me based on my actual experience of managing (trying to manage) a company. The lesson is to be firm and not popular. I must admit, it is difficult in trying to implement unpopular decisions especially if you are not the founder of the company. When you are promoted within a company and you have transformed from being one of the colleagues (us) to them (management), certain decisions can be viewed as apple-polishing, evil management trying to squeeze everything from the staff, not protecting the welfare of the staff, etc. Anyway, after reading through the lesson in Alan Axelrod's book, it has re-affirmed my commitment to do the right thing and not the popular decision. At the end of the day, we must answer to our own conscience only. I however, do not agree with Alan Axelrod's title in his lesson, i.e. "Get ready to be a lonely leader". I don't think leaders have to be lonely. If we are firm, ethical and sincere, people with the same qualities will appreciate it. Only those who fail to see the bigger picture will view our decisions with hostility and if such person cannot appreciate our qualities, we should not be losing sleep over it. As such, for me, the title of the lesson should be "Get ready to lose friends who do not share your views as long as your conscience is free. You will make other great friends on the way".

The following paragraph is extracted from the book by Alan Axelrod titled Gandhi, CEO (only words in BLUE are mine):


GET READY TO BE A LONELY LEADER

"It is a superstition and ungodly thing to believe that an act of a majority binds a minority."

- "Passive Resistance," Hindi Swaraj, 1909


Some CEOs are autocrats, others are democrats. Neither extreme is an optimal leadership policy. To impose authoritarian will on the members of an organization is to treat them as functionaries rather than as thinking human beings. Quite apart from the damage this does to individual morale, such a policy is a bad bargain for management because it fails to make full use of the company's costly human assets. Consider two workers: They are both paid the same salary; one uses 100 percent of her talent, the other 10 percent. Which worker represents the greater value for the company? The answer is self-evident, of course, yet authoritarian managers will fully sacrifice 90 percent of the value of their human capital when, by reflexively and inflexibly imposing their policies and procedures, they fail to allow an individual to use, to express, and to act on his or her uniquely valuable perspective and talent.

The democratic CEO, whose leadership is based on bending to the expressed will of the members of the organization, makes a different kind of mistake by her unquestioning assumption that the majority should prevail. Is her objective to please as many of her employees as possible? Or is it a belief that the majority is more likely to get a given issue right than the minority?

If the first answer is correct for a given CEO, we should question whether pleasing one's employees is even a valid goal for an enterprise? Is it likely to produce a profit, let alone the best possible profit? Almost certainly not. More valid goals might include creating customer satisfaction, producing a worthwhile product, and creating shareholder value. All of these-and preferably some combination of these-are more likely to contribute to productive sustainability than aiming to please the members of the organization.

Growing a productive and profitable enterprise is the surest way to create satisfaction among all the constituents of a company-especially the workers, whose ongoing livelihood depends on the ongoing success of the firm. Yet to achieve and sustain profitability, the CEO may from time to time have to make decisions that run contrary to the expressed will of the majority of his employees.

So be it. There is nothing sacrosanct or even inherently valuable about thoughtlessly bowing to the majority. It is also a fallacy to assume that the majority is more likely than the minority to be right. The classic refutation of this belief is the historical example of the many centuries during which the majority was convinced that the world was flat.

In the end, a leader must act with the well-being of every stakeholder in mind. This may mean sometimes making unpopular decisions, and it very often requires departing from the perceived wisdom of the majority by relying instead on advice from qualified experts or on your own understanding of the issues. Leadership, it is often said, can feel very lonely. The reason for this is simple: Leadership is lonely. Done right, it comes down to the decision of a single, solitary human being. Every other attitude, belief, or policy relating to leadership is either subordinate to this truth or is an instance of self-delusion.

In summary, for me, it is important as a leader to listen to all and values their opinion. After evaluating all opinions, it is important for a leader to make decisions based on big picture. As such, a test of whether a person is ready to be a leader is his ability to see things from different perspective, from view of staff, management, stakeholders, clients, competitors, etc. It is also important to have strong belief that you are doing the right thing. Some people will label strong leaders as lack of compassion and profit-driven with staff welfare ignored but histories have shown us that even leaders as compassionate as Gandhi needs to be firm in his belief that he is doing the right thing. Whether we are doing the right thing or not, only time will tell.

p.s. I am hoping to include the review of the book by Venerable Master Hsuan Hua who is a famous Buddhist teacher and draw some leadership lessons from his writings. Even though I have only started on his book, I am sure he will agree on the need to be firm and not bow to the majority. However, it is important to differentiate the effort of a spiritual leader where it should not be profit-driven but for an enterprise, profit is a must and should not be viewed as a dirty word. Whether we choose to be a leader in a profitable enterprise or charitable organisation is entirely up to an individual and there is nothing wrong with either decision. What is wrong is if we mistake working for a profitable enterprise but trying to implement charitable decisions or working for a charitable organisation but trying to implement profitable decisions.

Good luck!

Something is wrong with the financial world!

Asian Stocks Rise Amid Optimism on China Stimulus Outlook. That is one of the title of the article in today's Bloomberg's website. The title really got me baffling. It really seems that financial markets belongs to another planet while the rest are on Earth.

Well, I am no economist or financial expert but what I find wrong with the title is that the markets are "happy" that there is now a higher possibility of China stimulus. What prompted the higher possibility of China stimulus? Weak economic data from China and we are "happy" because China has shown signs of a weakening economy?

Of course, having stimulus will definitely buoyed the markets because it means more money is available in the market but that is definitely not something to be "happy" about. If the market rises because of more stimulus, it simply means that the financial markets are really a big "gambling" table and people are just rushing to "grab" as much money before the music stops. I thought share markets were created so that people can invest in a company which has the potential for good profits in the future but lacked the capital to realise their vision in the present and hence, the need to raise capital for expansion. Now, share markets are really like a big pyramid scheme. You just get more "suckers" buying into the scheme and once the buying stops, it will just collapse and then re-start again.

The current scenario is like a company (China) who is struggling because their clients (Europe) is not buying their products as much as they used to do. So, profits are going to go down. So, the company has decided to give all their employees higher salary (stimulus) so that they are going to buy more products from their own company to offset the reduced orders from other clients. And their clients are also telling the company's staff that they are saving too much. They should spend their additional salary and buy more products to keep the company afloat. The key question is are the employees buying something which will add-value to their future earning power? It is okay for stimulus if it is for construction of a much needed transportation system, university, etc. (not construction of ego-satisfying monuments) as it will create jobs and demand for products and at the same time, the completed infrastructure will add-value to the future. It is like a company investing to upgrade for example, their IT infrastructure. What if the stimulus (extra money) only results in higher stock price valuation, higher house prices due to speculation (not due to actual demand for first-time housebuyers), increased purchase of luxury goods, etc? This is like the company staff buying all the extra T-shirts, handbags, shoes, etc. that the company produces to keep the company's profit. It doesn't sound very sustainable isn't it?