Leadership Guide – Classic compilation by Sandeep Jain

Index Pg

1. Grassroots Leadership: U.S. Military Academy 2

2. Everything I Thought I Knew about Leadership Is Wrong 13
3. How to be a Real Leader 24
4. Natural Leader 27
5. Boooorrriinng!!! 34
6. 39 Leadership rules
52
7. 10 Ways to Beef Up Your Leadership Skills
67

Great Leaders

1. Disrupter - Akira Ishikawa

71
2. Finbarr O'Neill Is Not a Car Guy
75

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 Grassroots Leadership: U.S. Military Academy
Top

"Attention all cadets: There are five minutes to assembly for lunchtime
formation. The uniform is battle dress under field jacket." It's 11:55 AM. It's
really cold. About 200 feet above a bend in the Hudson River, the wind rushes
across the plain at West Point and slams into the six-story granite ramparts of
the United States Military Academy.

This is a massive, fortlike place screaming of history. A statue of General

George Washington commands the Parade Ground, flanked by Eisenhower,
MacArthur, and Thayer. The stone barracks, square and stark, bear the
names of Bradley, Lee, and Pershing.

"There are four minutes to assembly for lunchtime formation." Inside, cadet
"plebes," or freshmen, stand at attention, counting off the minutes until the
mandatory premeal convocation. Their cues come from clocks mounted every
50 feet or so along the halls.

Students tumble into the sprawling asphalt courtyards between barracks, as

they do at least twice each day, every day, year-round. "Fall in!" The
command is like an ionizing charge, driving loose bunches into perfect lines
and squares -- each square a platoon, four platoons to a company, four
companies to a battalion, and two battalions to a regiment. "Attention!" Eyes
shoot straight ahead.

Formation is a defining experience at West Point. Officially, it is a simple

exercise in accountability: From platoon on up, officers must know and report
how many cadets are present. But there's more to it, of course. Formation is
a nod to the past. Cadets have gathered in this way, on this spot, every day
for nearly 200 years. More important, it is a reminder of the primacy of
selflessness: Here, the individual yields to the greater whole -- to the corps.

On dismissal, the cadets begin marching. The movement looks

choreographed -- a dozen drab soldier streams flowing in right angles out of
the courtyard. In minutes, it's over. A few thousand cadets have removed
themselves. The courtyard is silent. And you think, That was one seriously
weird exercise. A weird and beautiful thing.

That pretty much describes the whole place.

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Leadership Lessons (I)

"The first lesson I learned as a plebe came from an upperclassman yelling in

my face. He told me that there were four acceptable answers: 'Yes, sir'; 'No,
sir'; 'No excuse, sir'; and 'Sir, I do not understand.' He'd ask, 'Why aren't your
shoes shined?' and I'd say, 'Well, it was muddy, and I didn't have time.' He'd
be all over me. He was trying to teach me something: If you have to take
men up a hill and write letters to their moms that night, there's literally no
excuse. If you have to lay off thousands of people from your company, there's
no excuse. You should have seen it coming and done something about it."
--James Kimsey, '62, founding CEO, America Online

The "West Point of Leadership"

Each spring, West Point graduates 900-odd men and women, granting each
of them a bachelor's degree and a commission as second lieutenant in the
U.S. Army. After six-week leaves, they travel to places like Kosovo, Germany,
and Guam. Once there, they take on their first jobs as military officers.
This fact alone is stunning: As a nation, we are entrusting to 21-year-olds the
safety of our enlisted troops, not to mention the care and deployment of
weapons of mass destruction, the keeping of peace, and the occasional
waging of war. The corresponding fact is this: By the time they leave West
Point, most of these kids are unquestionably up to the job. From the day that
they set foot on campus (in early July, before their freshman year), cadets are
prepared to take on responsibility, to face challenges, to make decisions
under stress, and to pursue the goals set out for them -- relentlessly.
The U.S. Military Academy is a factory, and what it manufactures is leaders.
Over the years, it has become probably the most effective institution for
leadership development in the country. If Harvard Business School is "the
West Point of capitalism," well, when it comes to leadership, West Point is the
real thing.
Of course, this leadership factory supplies the military. In return for a free
college education, graduates are required to serve the U.S. Army for at least
five years. After that, however, many spin out into areas like government,
education, and, most often, business -- where they thrive. "You see them
everywhere," says Geoff Champion, a 1972 graduate and a partner at
Korn/Ferry. They sit atop Amazon.com, America Online, Commerce One,
SciQuest, and many other successful companies.
Why? Understand this about West Point: Everything that we have read and
heard about it -- the rules, the structure, the rigidity, the conformity -- is
essentially true. This is a school where students learn, in one class, that "the
mortar is your best friend."
But understand this too: There's more to the story. The academy's complex
and arcane education hangs on an intriguing tension. Think of it, as West
Point's own leaders do, in terms of Athens and Sparta. The structure, the
monotonous regime, the rote memorization -- that's Sparta, and it's
important. Yet West Point also nurtures creativity and flexibility -- the Athens.
In the chaos of battle, as in business, leaders can't expect to stick to a fixed
plan. They depend on the predictable competence of their subordinates
(instilled by all of that training) as well as on their own judgment. Military

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officers are given orders, but how they get the job done is up to them.
"Everything that happens at West Point serves a question," says Ed Ruggero,
a 1980 graduate and the author of Duty First: West Point and the Making of
American Leaders (HarperCollins, 2001): "How do you develop an
organization that can thrive amid constant change?"
"This is a unique world, where everyone is trying to develop you," says David
Sattelmeyer, a senior, or "firstie," and a battalion commander, one of the
highest-ranking cadet positions. "You're constantly watching others to see
what works. And people are constantly looking at you. The place keeps
pushing you." Everyone is following, and nearly everyone is leading, all the
time. Everyone is evaluated -- all the time. Every action is taken as an
opportunity to learn.

Leadership Lessons (II)

"I had a former roommate who committed an honor-code violation. When he

told me what he'd done, I didn't bat an eye. I reported him. Not because I
didn't care about him; I cared deeply. But I knew that the principle was more
important than his being given a second chance. I was 18, and I realized that
my first responsibility was to the principle of honor."
--John Grisillo, '87, president, Compass Group

The Leadership Formula: Knowing, Doing, Being

"People say you can't change someone," says Lieutenant Colonel Scott
Snook, "but we're privileged here. We have some of the best and brightest
potential in this country, and we have them for 47 months, 24-7. We got 'em
at night, on weekends, all summer long."
He is not boasting, exactly. He is marveling at the opportunity. "We have
them when they're 18, which is a crucial moment," says Snook, who
graduated from West Point in 1980. "They're ripe for change. Not only do we
have them, but we're also empowered to change them. The country asks us
to change who they are!"
Back in rural Pennsylvania, where he grew up, Snook wanted to be a doctor.
To his own surprise, he has stuck with the Army for 21 years since his cadet
days. He was the executive officer of a company in Grenada, where he was
wounded by friendly fire. He earned an MBA and a PhD in organizational
behavior at Harvard, where he returns regularly to teach in executive
programs.
Snook now heads West Point's Office of Policy, Planning, and Analysis. His
mandate is to confront the academy's well-worn apparatus for leadership
development and to seek a scientific basis for a system that's rooted in
experience and inertia: Why are things done the way they are? What works?
How does it work? Could it work better?
The first Army leadership manual, written 25 years ago, coined the
expression "Be, know, do." It was a neat summation of how effective leaders
operate, but it also pointed to the central challenge of leadership
development. The capacity for "knowing" and "doing" is relatively easy to
build up in a student. It's a function of education and training, which is what
most universities are good at.

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But knowledge and skills are perishable -- both because they're not applied
all the time and because they can become outdated. It's the "be" piece --
your self-concept, your values, your ethical makeup, who you are -- that lasts.
That's what consumes Snook: What does it mean to be an officer? And how
can West Point shape the "be" piece for each of its 4,000 cadets?
Snook really loves this stuff. West Point has devised a mechanism, perhaps
unwittingly, that forces 18-year-olds to grow up. Cadets advance by
confronting moral ambiguity, by resolving competing claims on their identity.
That's how you get at the "be" piece. "We don't know if we have it right,"
Snook says. "But it happens through experiences, if you're passionately
involved. And bottom line, the sorts of experiences that change you are those
that get you out of your comfort zone.
"Sometimes," Snook continues, "the biggest window for changing someone's
self-concept opens when he fails. That's a fundamentally different way of
thinking about development. It might be when he fails a course for the first
time in his life or when he commits an honor-code violation. When that
happens, he's open to self-reflection."

Leadership Lessons (III)

"West Point is a uniquely humbling experience. I came from a small town,

where I was a good student and captain of my sports teams. I showed up at
West Point and found that 60% of my classmates were team captains, and
20% were valedictorians. One day you're the local star, and the next you're
just one of thousands of bald heads."
--Dave McCormick, '87, senior vice president, FreeMarkets Inc.

To Build Confidence, Teach Humility

The typical West Point cadet looks something like this: male and white
(though 15% of students are women, and 25% are nonwhite). Top decile of
his high-school class. Jock. Middle-class, middle-American. He came to the
academy because it is free, but he is also patriotic on some level.
The norm isn't definitive, of course. Any community of 4,000 people is a
community of 4,000 distinctive individuals. But in practice, the cadets who
reside in the standard-issue cinder-block rooms of Bradley Barracks look
pretty much the same. They say pretty much the same things. Hell, that's
part of the deal here: Everyone is part of a team, no individual more
important than the mission of the whole.
"Why do we make these kids endure such a spartan four years?" Snook asks.
"You stay in stone barracks. You can't put garbage in the garbage cans
before 9:30 AM, and the sinks must be clean and dry at all times. So many
rules and regulations. Why?
"Because when you graduate," Snook continues, "you're going to be asked to
be selfless. For a lot of hours while in the Army, you're going to suffer. You'll
be away from home for Christmas; you'll sleep in the mud. There are a lot of
things about this job that make you subordinate your self-interest -- so get
used to it."
This is the essence of what cadets learn. They hear it in the classroom, but
they also witness it around them, every day. The great leaders they see

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inspire and motivate because they care for their soldiers and because they're
willing to do themselves whatever they ask of others. "Look at any leader
who's made a big change," says firstie Randy Hopper. "The key is
servanthood. You can't lead without making sacrifices."
Hopper, a 22-year-old cadet from Baytown, Texas, is commander of Company
C-2, based in Bradley. There are 32 such companies, each comprised of
about 128 students, each with its own nickname (C-2 is the "Flying Circus"),
cheer ("Go Circus!"), and culture. The company is the core organizational unit
at West Point. It is also the crucible for experiential leadership development.
Here's how it works.
Plebes are, as ever, at the bottom. They learn how to follow, absorbing and
acting on the orders of their superiors. Second-year students, or "yearlings,"
are assigned teams of one or two plebes. In this first, modest experience as
military leaders, yearlings learn to develop intimate relationships with their
subordinates, rooted in mutual trust. They are held directly accountable for
their plebes' performance.
Yearlings report, in turn, to third-year students, or "cows" (a long story), each
cow responsible for squads of two or three yearlings and four to six of their
plebe charges. Cast in the roles of noncommissioned officers of the cadet
brigade, cows must exercise indirect leadership. They are accountable for the
plebes as well, but they must direct behavior through the yearlings. They
must learn to motivate by example.
Firsties run the show. The summer before classes begin, they direct the eight
weeks of military training for incoming plebes and yearlings. Come August,
they take the roles of commissioned officers in the cadet hierarchy. Platoon
leaders report to company commanders and their staffs, who answer to
battalion commands, regiments, and the brigade.
Everyone leads, and everyone follows. Everyone models, and everyone
assesses. Cadets' formal evaluations of their subordinates' performance
count toward final grades. "Everyone's a teacher," says firstie Chris Kane, a
platoon leader under Hopper in C-2. "That's what I love about this place.
We're all teachers."
In this 24-hour leadership laboratory, students acquire humility. As leaders,
they are nothing without followers. "You learn from the beginning that you're
not in a position of leadership because you're smarter or better," says firstie
and C-2 executive officer Joe Bagaglio. "As soon as you think you know it all,
you get burned."
And they must perform under stress. Cadets face a daunting crush of
academics, sports, and military activities. The academy's administrators
know that there is enough time, in theory, to get it all done; they have
studied this. In practice, though, cadets learn to prioritize -- what must come
first and what can be left undone. More than that, they come to accept that,
amid chaos, the only thing that they can control is themselves. Under fire,
"you don't ask how to get it done," says Kane. "You just do it."
Major Tony Burgess follows all of this with reactions that range from concern
to bemusement to pride. As the tactical officer attached on a full-time basis
to C-2, Burgess, '90, is likely the single most influential person in the
development of the company's 128 young cadets. He is, as he likes to put it,
their "teacher-coach-mentor-disciplinarian-den mother."

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Burgess himself is a leadership junkie. The son of missionary parents, he
spent his childhood in Mexico and entered West Point with grand visions. "I
was going to get out of the Army after five years, and by age 30, I was going
to be a millionaire in business," he says. "I didn't know how, but I was going
to do it. Then, somewhere along the way, I fell in love with leading."
Burgess has spent 10 years in the infantry, and he will tell you that there is
no better job in the world than commanding an Army company. He grew
passionate enough about it to start up a Web site, CompanyCommand.com --
an unauthorized (but unofficially welcome) resource for company
commanders that has attracted many users. With his classmate and best
friend, Nate Allen, Burgess has written a book on the same topic, Taking the
Guidon: Exceptional Leadership at the Company Level, which is available on
his Web site.
Among his cadet charges, Burgess radiates intensity and enthusiasm. He is at
once approachable and reserved, a buddy and a boss. His success depends
on maintaining a fine balance -- guiding students' decisions without actually
making them, giving students enough rope but knowing when to haul it in. He
is the one who must look out for developmental opportunities and failures. He
must be ready to influence.
If Burgess succeeds -- if West Point succeeds -- his cadets will emerge, he
thinks, as the "go-to" people. "They'll be the ones who you know will make it
happen," he says, "the guys who will do better than we ever imagined
possible."

Leadership Lessons (IV)

"I led a team of incoming plebes during basic training. I thought I had to lead
the way that I saw others doing it -- with stress and shouting, like a traditional
drill sergeant. Well, my unit performed very badly. And they hated me. That
experience shook me up. I realized that leadership isn't rule-based. It isn't
about stress. It's about inspiration, about setting and communicating a vision.
It's about gaining trust. Once you have someone's trust, once you get them
on the same sheet of music, they don't want to disappoint you. Then leading
becomes very easy."
--Christina "CJ" Juhasz, '90, director in online ventures, Merrill Lynch

West Point's Leadership Curriculum

Until after World War II, there was no explicit leadership instruction at West
Point. Back then, the academy was known primarily as an engineering school.
How could leadership possibly be taught? How do you teach judgment or
inspiration in a classroom?
Hike to the top floor of Thayer Hall, and you will find Lieutenant Colonel Greg
Dardis engaging small groups of firsties in discussions of classical-leadership
theory, dissecting such leading-edge thinkers as Morgan McCall and Peter
Senge. Cadets today can actually major in leadership. And even if they don't,
such instruction is deeply ingrained in the curriculum.
In their third year, cadets must take a course called Military Leadership. The
timing is significant. At that point, cadets have returned from a summer
spent interning with Army units around the world, often temporarily replacing

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platoon leaders in the field. They have served as team leaders in their cadet
company. "They have experience under their belts," says Dardis, who
graduated from West Point in 1979 and now heads the leadership and
management studies program. "They've observed both good and bad
leadership."
The object is to reflect on that experience, to assess it in terms of theory.
Early in the course, cadets are asked to write about their leadership
philosophy -- a graded exercise that forces them to reflect on their talents
and weaknesses. They write reflection papers that explain theoretical
constructs in terms of their own experiences.
Cadets also take on a raft of case studies penned by West Point faculty, most
of them rooted in combat situations. The students also engage in action-
learning projects -- some of which are distinctly non-military. When Snook
taught the class, he would take his students to the elementary school that
serves West Point families: "I'd say, 'You all think you're leaders? Well, you're
going to lead a recess.' " The assignment: Develop a plan for overseeing
seven minutes of playground activity.
Most often, cadets responded by thinking in terms of command and control:
First we'll play dodgeball. Then we'll move to the swings. I'll direct every
movement of every kid out there.
Then they watched the teacher lead an actual recess. As kids poured out onto
the playground, there was chaos. And then order emerged, as the children
basically organized themselves into teams. The exact order that resulted was
unpredictable -- but it was entirely predictable that some form of order would
emerge.
"I asked them to rate recess," Snook recalls. "Well, they said that everyone
had fun, and no one got hurt. So I asked them to tell me about the leader.
'Well, the teacher just stood there,' they said. So, is leading that easy? Is it
totally hands-off? No. The way you influence complex, chaotic systems is by
setting the starting conditions. You set the starting conditions, the left and
right boundaries, and the minimum specifications. The teacher had a fence
around the playground, and she established four or five rules. After that, her
job was managing by exception."
Meanwhile, the leadership of West Point is thinking about the institution's
exceptional past -- and challenging future. The academy exists on a razor's
edge. To stay effective, it must retain much of what makes it different -- yet it
also must continuously accommodate changing external demands. "We can't
be so different that the notion of being the Army of a democracy fails," says
Lieutenant General Daniel W. Christman, the academy's well-regarded
superintendent. "We have to reflect what society demands of us."
The 1965 graduate believes that in order to fortify its relevance in the post-
Cold War era, the academy must adjust its mission. It must reflect the new
ambivalence with which America regards its armed services. That means
equipping its graduates less for combat leadership than for "officership" -- a
vague notion that encompasses any number of the roles that the Army may
fill. "We need to educate cadets in a way that doesn't constitute a military
straitjacket," Christman says.
That may be so. West Point produces young officers who have been
encouraged to act as entrepreneurs, to act quickly and decisively, to operate
effectively amid chaos. These are traits that clash with the reality of military

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service in peacetime. So here's the irony: If the academy's education has
become less applicable in the Army, it has grown more relevant in business.
"Running a company, especially a startup, is not unlike a battle," says Mark
Hoffman, a 1969 graduate and now chairman and CEO of online-exchange
giant Commerce One. "Bombs are going off all around you. The market and
the competition are changing constantly. Your stock price is falling. You have
to stay calm in the face of strife."
West Point dedicates itself to producing graduates who will, as its mission
statement avers, "dedicate a lifetime of selfless service to the nation." The
vague wording concerns those who believe that such service should be
strictly military. But as a nation, we are short of great leadership in every
sector. We may lament West Pointers' abandonment of the military. But
guess what? Business has become the new national defense. Service to
economy, selfless or not, constitutes service to the nation.

Sidebar: The Grassroots-Leadership Agenda

Who: West Point alumni

Who: Leadership lessons for business
Why: In an era of great change, business feels a lot like war
What are the leadership qualities that give West Point grads an edge in
business? Academy graduates reflect on what they learned.
Responsibility: "This is the underlying theory," says Mark Stabile, '90, a
senior partner at Greencastle Associates Consulting. "If you give people
responsibility early, give them the opportunity to go out and do things, they'll
go out and do them."
Trust: "Your ability to get people to follow you up the hill into gunfire or into
the next Net meltdown is based on your ability to convince them that you
have their interests at heart," says Dave McCormick, '87, a senior VP at
FreeMarkets Inc.
Flexibility: Structure is important, and predictability of behavior is critical.
But in chaotic situations, leaders must be able to decide on the fly. "When
you go into battle, order quickly disintegrates, and you have to take action
with limited information," says Mark Hoffman, '69, chairman and CEO of
Commerce One. "You have to make decisions about what to do. You need
individuals who can decide in the heat of battle."
Failure: "At some point, everyone fails," says entrepreneur Donald A. Hicks,
'90. "West Point makes you deal with the fact that you're capable of doing far
more than you think - and that at some point, you can't do any more."
Planning: Cadets plan everything - all the time. They imagine the
consequences, and they devise contingency solutions. "It's an internalization
that forces you to start thinking ahead," says AOL founding CEO James
Kimsey, '62. "It causes some degree of paranoia, because you try to think of
every outcome so that you will achieve success."

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 Everything I Thought I Knew about Leadership Is Wrong Top

In 1992 Ross Perot asked me if I would join Perot Systems as CEO. It had
been five years since he and I had left EDS. I told him I would do it -- with the
disclaimer that I didn't know much about the current shape of the business.
Ross told me, "Just follow your nose."

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That's what I did. It took me six months. I visited with all the associates of
Perot Systems and all of our customers. Then I went back to Ross and told
him, "Everything I thought I knew about leadership is wrong."

All the reasons he'd asked me to rejoin him for were wrong. The people who
had signed on, thinking we'd recreate a new and improved EDS at Perot
Systems had expectations that were wrong. They would have to either
change or leave.

It was a traumatic meeting. Not that he got mad. It was just a mouthful to tell
somebody.

I was telling him that everything had changed. Technology, customers, the
environment around customers, the market -- all had changed. The people in
the organization and what they wanted from their work had changed.

Organizations must change radically: we are at the beginning of a

revolutionary time in business. Not just an evolutionary time. Not a year-to-
year change. A fundamental revolution. Many companies that have enjoyed
decades of fabulous success will find themselves out of business in the next
five years if they don't make revolutionary changes.

Of course, many of these changes are about technology. They're also about
the fundamentals of business and people, and they raise elemental
questions: How does this business revolution affect the organization? What
does it mean to the people in the organization? What changes do we have to
make in the way we communicate?

And most important: What is the new definition of leadership?

I can't offer absolute answers to these questions. But I do know from my own
experience that the leadership techniques that applied 20 years ago don't
apply anymore.

My intense self-examination left me wrestling with two questions:

To get rich, do you have to be miserable?

To be successful, do you have to punish your customers?

To answer these questions, I would have to look deeply into myself, reinvent
my concept of leadership. And in the process, we'd all have to reinvent Perot
Systems.

To get rich, do you have to be miserable?

In purely financial terms, my seven years running EDS had been unbelievably
successful. When I left, I was very proud of the people, the company, and our
achievements. From the day I started as president in 1979 to the day I left in

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1986, EDS never had a single quarter where we lost money. We never even
had a quarter where we were flat -- every quarter we grew like gangbusters.
That kind of economic performance made a lot of our people very rich. I used
to take enormous pride in the fact that I was instrumental in getting a lot of
equity into the hands of the people at EDS.
What I realized after I left was that I had also made a lot of people very
unhappy. Our people paid a high price for their economic success. Eighty-
hour weeks were the norm. We shifted people from project to project and
simply expected them to make the move, no questions asked. We called our
assignments "death marches" -- without a trace of irony. You were expected
to do whatever it took to get the job done. In terms of priorities, work was in
first place; family, community, other obligations all came after.
None of that happened by accident. I had helped design EDS to operate this
way, using the compensation system to motivate people: I tied their pay to
profit-and-loss performance. If you ran your project very profitably, you were
richly rewarded. If you didn't, you weren't. I routinely spent an extraordinary
amount of my time on compensation and rewards -- roughly 15%. I did it
because I knew that compensation mattered most.
The system worked; that is, we got exactly what we wanted. We asked
people to put financial performance before everything else, and they did.
They drove themselves to do whatever was necessary to create those results
-- even if it meant too much personal sacrifice or doing things that weren't
really in the best interests of customers. Sometimes they did things that
produced positive financial results in the short term but weren't in the
company's long term interest. That's a charge you'd usually apply to a CEO --
but I've never heard it said about individuals down to the lowest ranks of a
company. Yet my pay-for-performance approach effectively encouraged that
behavior from all of our people.
When I came to Perot Systems, what I saw in my six months of listening
inside the company convinced me that we were about to make the same
mistake. The emphasis on profit-and-loss to the exclusion of other values was
creating a culture of destructive contention. We were about 1,500 people,
with revenues of roughly $170 million. Our people were committed to
growing the company -- but we risked becoming a company where the best
people in the industry wouldn't want to work.
For example, I listened to some of our senior leaders talk about how they
handled people on teams who didn't perform. I heard talk of "drive-by
shootings" to "take out" nonperformers; then they'd "drag the body around"
to make an example out of them. They may have meant it only as a way of
talking, but I saw it as more: abusive language that would influence behavior.
Left unchallenged, these expressions would pollute the company's culture.
The first moment of truth came when we held a three-day off-site meeting in
Phoenix, Arizona with the top 12 leaders in the company. We had to decide
the fundamental purpose and character of Perot Systems: Were we here only
to create a successful Initial Public Offering (IPO)? Or were we here to build a
great company? And if it were the latter, were we bold enough to review
everything we'd done -- and then reinvent the company?
We decided that, as much as we wanted to do the IPO, we had to build a
great company. And we concluded that this wasn't just "feel good" talk -- it
was a serious business proposition. We had to launch a transformation of

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Perot Systems. It was a decisive moment, but none of us truly knew what we
had begun.
We convened meetings of the top 100 people in the company and asked
them long lists of questions: How did they feel about the company culture?
What was their evaluation of our top executives? What were their feelings
about our customer relations? The answers were a laundry list of horrifying
bad news. Our people were angry, frustrated, irritated, deeply unhappy. If our
company were entered in a 100-yard dash, I concluded, we were beginning
the race from 50 yards behind the starting line.
We set up teams to address these concerns and then reconvened the top 100
to ask them, again, how they felt. We got the same answers. We initiated a
companywide program to teach us how to disagree with each other without
tearing each other down. I attended the seminars three times; all our
company leaders in the United States and Europe participated; and we
extended it down into the ranks, so that today two-thirds of the entire
company has been through the course.
During these seminars, we identified people who were abusive. We coached
them and took them through a personal reinvention process to show them
new ways of leading. These were high-ranking company officials who had
generated significant business, met or exceeded their financial goals -- but
simply mistreated their people. Not all of them could convert. Those who
couldn't change, we asked to leave. We gave them fair and extended
compensation; we didn't strong-arm them out the door; and we tried to keep
communications open with them. We simply told them that this wasn't a
company that was right for them.
In all, several dozen people, ranking from project leader on up, left Perot
Systems. This one difficult step made us a better place and a better
competitor. Our people looked at what we'd said and then at how we'd
handled those who'd left and saw that we walked our talk: we did ask them to
leave, and we didn't treat them abusively in turn.
We involved top leaders and associates throughout the company in a
discussion of our values and work styles. Finally, after nearly a year of
internal conversation, we arrived at statements that we could all agree on. All
of these efforts -- the emotionally charged meetings, the constructive
contention seminars, the drafting of our company values -- produced a
genuine transformation. We started to behave like a company whose people
not only focused on day-to-day business and economic performance, but also
concerned themselves with the well-being of the people on their teams and
the concerns of their customers. We were becoming a company where the
larger issues of life were as important as the demands of profit-and-loss
performance.
My approach to compensation also changed. We still tell people we'll give
them everything we can in the way of financial rewards. In fact, more than 60
% of our company is owned by the people who run the company. So if we go
public someday, we'll still make a lot of our people very rich.
But we will have done it without having first made them miserable -- by
offering them another dimension they can't get in most other high-
performance companies: a human organization. If any of our people has an
interest outside the company, we will encourage and support them; if they
have needs outside the company, we will recognize them.

Page 13 of 60
For example, rather than contributing corporate money to charities, we
encourage our people to contribute their own time to a cause they believe in.
Very simply, we don't believe in "write a check to charity." Instead we have
an office that helps our employees carry out their own contributions to the
community -- helping at a senior center or an orphanage, or teaching English-
as-a-second-language in the afternoon at a local school.
Inside the company we apply the same set of values. Business-the-old way
told people to leave their personal problems at home. Now we make it clear
that personal issues are our issues as well. Not long ago, one of our sales
executives had a child born with a hole in its heart. Through e-mail, I knew
about that child within four hours of its birth. Within eight hours we had a
specialist working with the infant. The child will now be able to lead a normal
life. Our company made that happen because it was the right thing. It's not
the only kind of thing we should do -- but it does represent what we should
be, the kind of feeling our company should create.

To be successful, do you have to punish your customers?

I had the same kind of question about our customers as I did about our
people. Looking back on my years at EDS, I was absolutely convinced that we
produced real value for our customers that exceeded what we charged them.
But I also had to acknowledge that all too often, our relations with customers
were unnecessarily strained and difficult.
Of course we delivered what we promised. But there were two problems: we
made sure we won virtually every negotiation that decided what would be
delivered; and our tone was often paternalistic, almost condescending.
Customers felt like they were outgunned at every turn. Too often we made
them feel incompetent or just plain stupid -- after all, they had called us to
bail them out of trouble, hadn't they? I left EDS thinking not that our aims had
been wrong or dishonorable, but that the way we had pursued them -- in
truth, the spirit with which I had led the company -- had ultimately diminished
both our own organization and our relations with customers.
It wasn't until I had been out of EDS for a year, consulting to several other
companies, that I began to get a clear line of sight on this question. As a
consultant, I watched other vendors sell their products, many of which were
the same ones I had sold. This time, I listened to their presentations with the
ears of the purchaser. And what had sounded good when I was on the
pitching side didn't sound so authentic from the receiving side. It sounded
arrogant, rigid, and high-handed.
I had to acknowledge that at EDS I had encouraged that attitude -- it was a
reflection of my own approach to leadership. To be a leader at EDS, you had
to be tougher, smarter, sharper. You had to prove that you could make
money. You had to prove that you could win at negotiations every time. I
used to pride myself on my negotiating skill. I made sure I swept the table
clean of every loose penny that was around. It never occurred to me that
winning big could be a negative thing. At the time it felt great: business is a
competitive sport, and I just cleaned the table!
But you can overplay that hand. A company culture that isn't satisfied with
winning but also needs to dominate, that isn't content with getting great
results but also has to eliminate everything in its path is fundamentally

Page 14 of 60
destructive -- and ultimately self-destructive. After I left EDS, I learned that
sometimes it's better to leave something on the table. Sometimes you do
better if you leave people with alternatives. You do better if your customer or
your competitor doesn't feel taken advantage of. You do better, in fact, if
your customer feels like your partner.
Here again, at Perot Systems, I turned to the compensation system to help us
live the lesson. We use 360-degree evaluations for our people -- asking boss,
peers, and subordinates to participate -- and always include input from our
customers. We also ask our customers to give us report cards -- and then we
temper bonuses based on customer ratings of how well we support their
needs.
But the lesson really struck home when I went to Switzerland recently to put
the finishing touches on our strategic alliance with Swiss Bank Corp. It's the
biggest deal in the history of our company, a hybrid relationship that goes
beyond the bank simply outsourcing its information technology. We are
partners. They have an option to own shares in Perot Systems; we have a
stake in their information technology subsidiary in Switzerland; together we
agreed to a 25-year relationship that transfers management of Swiss Bank's
corporatewide information technology infrastructure to Perot Systems.
To brief their own people on this relationship, the top leaders of the bank
called a meeting. My only role was to be introduced and say a few words.
Almost all of the meeting was conducted in German; finally, at the end, to
introduce me, they switched to English. In this first public introduction, what
they chose to talk about was our values and our approach to partnering.
At the end of the introduction, the senior Swiss Bank executive took out a
Perot Systems card with our values and said, "Five years from now, when we
look back at our partnership, we should use these values to judge how well
we've done." That one introduction convinced me that what we're trying to
do is very powerful and knows no cultural bounds.

The three jobs of the leader.

We should never lose sight of the fact that we're in business to create a first-
class organization and to survive. That's what businesses are supposed to do.
At the same time, we need a more expansive definition of victory. There's a
much larger calling in business today than was allowed by the old definitions
of winning and losing. One hundred years from now, we'll know we were on
the right track if there are more organizations where people are doing great
work for their customers and creating value for their shareholders. And
raising their children, nurturing their families, and taking an interest in their
communities. And feeling proud of the contributions they make. These are
things you can't measure when winning and losing are only financial metrics.
It's taken me a while to learn these things. When I returned to Perot Systems,
my first job as a leader was to create a new understanding of myself. I had to
accept the shattering of my own self-confidence. I couldn't lead anymore, at
least not in the way I always had. There was a time during that first year at
Perot Systems when I would go home and look in the mirror and say to
myself, "You don't get it. Maybe you ought to get out of this business. You're
like a highly specialized trained beast that evolved during one period and
now you can't adjust to the new environment."

Page 15 of 60
I told myself I was having the same experience as a caterpillar entering a
cocoon. The caterpillar doesn't know that he'll come out as a butterfly. All he
knows is that he's alone, it's dark, and it's a little scary. I came out the other
end of the experience with a new understanding of leadership. I don't have to
know everything. I don't have to have all the customer contacts. I don't have
to make all the decisions. In fact, in the new world of business, it can't be me,
it shouldn't be me, and my job is to prevent it from being me.
In my early days at Perot Systems, people came to me and asked for "the
plan." When I told them, I don't know the plan, they got angry with me. All I
would say was, I don't know the plan. If that disqualifies me from being a
leader, then you'd better go get another leader. We're either going to figure
out the company's future together or we're not going to do it at all.
I made it clear that there were a whole set of things that I couldn't do -- and
that for the good of Perot Systems I wouldn't do. I couldn't get us into
businesses or out of businesses. I couldn't set the company's strategy,
delineate the company's tactics, or write the field orders for our competitive
battles. I couldn't decide what products to launch. I couldn't be that kind of
leader. I could do that in the old days at EDS because the competition was
stable and I had overpowering knowledge. If I tried to do that today, I'd make
every wrong move in the book. The way to be a leader today is different. I no
longer call the shots. I'm not the decision maker.
So what is my job as a leader? The essence of leadership today is to make
sure that the organization knows itself. There are certain durable principles
that underlie an organization. The leader should embody those values.
They're fundamental. But they have nothing to do with business strategy,
tactics, or market share. They have to do with human relationships and the
obligation of the organization to its individual members and its customers.
For example, our most controversial value --the one that was narrowly
approved -- speaks to our commitment to the community. It was also the one
I argued most heatedly for. And today, it's one our entire organization
supports fervently.
The second job of the leader is to pick the right people to be part of the
organization and to create an environment where those people can succeed.
That means encouraging others to help develop the strategy and grow the
philosophy of the company. It means more collaboration and teamwork
among people at every level of the company. I am now a coach, not an
executive. When people ask me for a decision, I pick up a mirror, hold it up
for them to look into, and tell them: Look to yourselves and look to the team,
don't look to me.
The third job of the leader is to be accessible. I want to be open to people in a
broad range of their experiences in life if they need it, and I want to be
accessible for two-way communication that's honest, open, and direct. During
my years at EDS I communicated the way most CEOs do: I showed up on
stage every six months and delivered a pep rally speech. I wrote memos that
went to the top dozen people in the company and had meetings with them
every two weeks.
Today I travel with my laptop and get e-mail from all over the company. I get
thousands of messages per month, some of them trivial, many important.
Everyone in Perot Systems knows they can e-mail me and I'll read it -- me,
not my secretary. Electronic mail is the single most important tool I have to

Page 16 of 60
break through the old organization and the old mind-set. E-mail says that I'm
accessible to anyone in our company in real time, anywhere. I am an instant
participant in any part of the organization. No more dictating memos that get
scrubbed before their formal distribution to the corporate hierarchy. Now,
when I hear about a win in a hotly contested competition, within an hour of
the victory I'm sending out congratulatory e-mails to our team members
around the world. The impact from that kind of direct communication is
enormous.
And I'm accessible on issues and concerns that transcend the traditional
boundaries of work and the company. Not long ago, for example, I got an e-
mail message from one of our new senior associates. The news was urgent:
his father-in-law had just been diagnosed as having cancer and he was going
off the Net for the next two days. I e-mailed back immediately that the
company would stand behind him any way we could. The next day I got
another e-mail message: it was worse than they had thought; they were in a
small Texas town, and they didn't know who to go to for help. I e-mailed back
with the name of a doctor at Southwestern Medical School who referred them
to the best help they could find.
Today I tell the people in Perot Systems that this is the path that we have
chosen. It's the path we'll all be on for the rest of our lives. It has no
destination. There is no sense of arrival. It's a continuous process.
In a world where the lines between companies, industries, and even nations
get blurred, a leader builds an effective organization around values and work
style. And a leader learns to define success in business as both producing
financial strength and generating a team of people who support and nurture
each other.

Sidebar: My Intro to Leadership Course

In 1967 Ross Perot gave me my intro to leadership course at EDS. I had just
joined the company in January 1966 and already I was going to Ross about
once a week with a new way I thought we should change things. He rejected
every idea. He even wondered aloud if I belonged at EDS. Finally he offered
me a chance to be the leader of a five-person project, working with Blue
Cross and Blue Shield of Texas on a system that processed Medicare
insurance claims. This was Ross's original customer, the client he had had
when he was with IBM before he founded EDS. That told me it was highly
important; I assumed that this was the test. At the time I didn't know the
reason there was an opening for a project team leader. Much later I learned
that the five people on the project had told Ross that if he didn't remove the
project leader they were all going to quit. Nobody told me that. But it was
clear when I walked in the door and announced I was the new team leader, I
had entered a tense situation. One of the team members told me that he was
10 years my senior, had already been on the project a year, and that he
should be the team leader. Why was I even there?
Somehow it worked. This project was the first of its kind. We developed a
brand new system in a brand new language working with a brand new
computer in just 90 days: over one year's work crammed into 3 months. In
the process we took project revenues from $16,000 a month to $400,000 a
month. We took it from a breakeven project to 80% pretax profitable.

Page 17 of 60
That began my training as a leader at EDS. Then in the summer of 1967, Ross
gave me the two-week crash course in sales and leadership. We had a major
opportunity for a contract with Blue Shield to process their Medicaid claims. It
was my project to lead. But I didn't know the first thing about putting
together a proposal.
I went to Ross and asked him: How do you price a contract? He said, "Why
don't you go back and make a proposal, figure it out, and then sit down and
give me the options?" The next week it was time to present it to the
customer. I'd never done that either, so I asked Ross: How do you present
this? He said, "Why don't you go make an outline and then come back and
show me your proposal?"
So I did. Then the day came to meet the customer. At 8 a.m. I went to meet
Ross so we could make our 9 a.m. meeting with the customer. When I got
there, Ross's secretary told me he had left town. I had never met the
customer. I had never made a sales pitch in my life. But I didn't have any
choice. When I sat down in front of the customer's executive vice president, I
was so scared I literally couldn't talk.
Fortunately, the manager of the customer's unit I'd been working with sat
next to me. I had a written offer in my hand, and he took it away from me
and started reading the proposal aloud. In an act of charity, the executive
vice president listened to the offer and then asked me a question about the
technology. I was very comfortable with the technology, so I could answer
that. Finally I loosened up and at the end of an hour the executive vice
president signed the contract.
Within three years we took the 5-person group I was leading and grew it to
1,500 people. That became the health care business of EDS -- at that time
the financial engine of the company.
In 1979 I became president of EDS. It was roughly a $200 million company.
Five years later we reached $1 billion in revenues. That same year General
Motors suggested that they buy us for $2.5 billion; the deal was closed in
October 1984. I was the lead manager for the next two years when EDS went
from $1 billion in revenues to $4.4 billion. So I went from managing 5 people
in 1967 to managing 45,000 people in 1986. When I left EDS, it was the
largest computer services company in the world.
Mort Meyerson (morton.meyerson@2m.com) is chairman and CEO of Dallas-
based Perot Systems. He joined EDS in 1996; From 1979 to 1986, he served
first as president, then as vice-chairman.

Page 18 of 60
 How to be a Real Leader

If leadership is so important, why are effective business leaders so rare?

Kevin Cashman, a Minneapolis-based leadership coach, thinks that he has the
answer: "Too many people separate the act of leadership from the leader.
They see leadership as something that they do -- rather than as an
expression of who they are."

Cashman is the founder and CEO of LeaderSource, which has helped

executives from companies such as Pillsbury, American Express, and
Rollerblade to explore what it means to lead. His flagship program, the
Executive Leadership Institute, has been dubbed "the Mayo Clinc of
Leadership." Why do leaders come to Cashman for a checkup? "Leaders lead
by virtue of who they are," he replies. "If we want to be more effective with
others, we first need to be more effective with ourselves."

Cashman's most recent book, Leadership from the Inside Out (Executive
Excellence Publishing, 1998), distills his insights about becoming a real
leader. In an interview, he distilled his thoughts even further.

What does an effective leader look like?

There are three core qualities to leadership: authenticity, self-expression,

value creation. "Authenticity" refers to a link between the inner and the outer
person. Truly authentic leaders are open both to their gifts and to their
underdeveloped qualities. People who understand who they are tend to have
a more powerful voice -- and to make a more profound contribution to an
enterprise.
We do a lot of work with Pillsbury. The current CEO, Paul Walsh, came to the
job from finance. He had none of the marketing experience that's so critical
to running a consumer-products company. The first thing he did was to admit
to that knowledge gap; he then created a plan to learn everything he could
about marketing. Because he was so open, people enthusiastically helped
him.

What separates authentic leaders from the rest of the pack?

Most of us know more about our favorite sports team or vacation spot than
we know about ourselves. Leadership comes from one of two places: persona
or character. Persona is the coping part of our personality -- a mask that we
create to protect ourselves from external stresses and internal fears.
Character is the essence of who we are; it goes beyond what we do. It's
critical to spot the cues that signal when you're in character and when you're

Page 19 of 60
relying on a persona: Under what circumstances do you tend to get stuck?
When do you overreact? When does everything come together and flow?

The second attribute of leadership is self-expression.

Does that mean "straight talk"? It means something more than straight talk.
How often have you held back from saying something that you felt was
important -- just because you were worried about how you would express
yourself? How often have you feigned modesty about something that you
were really proud of? Authentic expression goes beyond telling the truth: It
demonstrates a total congruence between who you are and what you do and
say.

Leaders are measured by results. How does authentic expression

translate into value creation?

Leaders create value through relationships. But many leaders still have the
illusion that they are the ones who really "make things happen." Admitting
that you don't have all the answers is a big part of building good relationships
-- and a big part of getting good results.

Sidebar: How Authentic are You?

It's impossible to lead people who don't trust you, and it's impossible to build
trust without cultivating authenticity. According to Kevin Cashman, asking
these three questions will help you to explore your authenticity.
Do you know yourself? Get in the habit of asking yourself two crucial
questions: "Why do I pursue the work and the life that I do?" and "What do I
act like during the most fulfilling times of my life?" Your answers will help you
spot the defining thread of your experiences, and they will lead you to your
purpose.
Do you know how to listen -- and to hear? Most leaders think that not
speaking is the same as listening. But hearing people's words is only the
beginning. Do you also hear their fears? Their intentions? Their aspirations?
When you start to hear at a deeper level, you'll start getting information from
people. Better yet, people will know that you care about them, and they will
eagerly commit to you.
What's your appreciation ratio? In the business world, confrontation,
criticism, and even hate are more socially acceptable than expressions of
appreciation. That's too bad, because appreciation is a truly value-creating
activity. It energizes people, and it makes them want to exceed their goals
and perceived limits

Page 20 of 60
 How to be a Real Leader Top

Kevin Cashman advises leaders from companies such as American Express, Pillsbury, and
Rollerblade. His message: "To be more effective with others, we first need to become more
effective with ourselves."

If leadership is so important, why are effective business leaders so rare?

Kevin Cashman, a Minneapolis-based leadership coach, thinks that he has the
answer: "Too many people separate the act of leadership from the leader.
They see leadership as something that they do -- rather than as an
expression of who they are."

Cashman is the founder and CEO of LeaderSource, which has helped

executives from companies such as Pillsbury, American Express, and
Rollerblade to explore what it means to lead. His flagship program, the
Executive Leadership Institute, has been dubbed "the Mayo Clinc of
Leadership." Why do leaders come to Cashman for a checkup? "Leaders lead
by virtue of who they are," he replies. "If we want to be more effective with
others, we first need to be more effective with ourselves."

Cashman's most recent book, Leadership from the Inside Out (Executive
Excellence Publishing, 1998), distills his insights about becoming a real
leader. In an interview, he distilled his thoughts even further.

What does an effective leader look like?

There are three core qualities to leadership: authenticity, self-expression,

value creation. "Authenticity" refers to a link between the inner and the outer

Page 21 of 60
person. Truly authentic leaders are open both to their gifts and to their
underdeveloped qualities. People who understand who they are tend to have
a more powerful voice -- and to make a more profound contribution to an
enterprise.
We do a lot of work with Pillsbury. The current CEO, Paul Walsh, came to the
job from finance. He had none of the marketing experience that's so critical
to running a consumer-products company. The first thing he did was to admit
to that knowledge gap; he then created a plan to learn everything he could
about marketing. Because he was so open, people enthusiastically helped
him.

What separates authentic leaders from the rest of the pack?

Most of us know more about our favorite sports team or vacation spot than
we know about ourselves. Leadership comes from one of two places: persona
or character. Persona is the coping part of our personality -- a mask that we
create to protect ourselves from external stresses and internal fears.
Character is the essence of who we are; it goes beyond what we do. It's
critical to spot the cues that signal when you're in character and when you're
relying on a persona: Under what circumstances do you tend to get stuck?
When do you overreact? When does everything come together and flow?

The second attribute of leadership is self-expression.

Does that mean "straight talk"? It means something more than straight talk.
How often have you held back from saying something that you felt was
important -- just because you were worried about how you would express
yourself? How often have you feigned modesty about something that you
were really proud of? Authentic expression goes beyond telling the truth: It
demonstrates a total congruence between who you are and what you do and
say.

Leaders are measured by results. How does authentic expression

translate into value creation?

Leaders create value through relationships. But many leaders still have the
illusion that they are the ones who really "make things happen." Admitting
that you don't have all the answers is a big part of building good relationships
-- and a big part of getting good results.

Sidebar: How Authentic are You?

It's impossible to lead people who don't trust you, and it's impossible to build
trust without cultivating authenticity. According to Kevin Cashman, asking
these three questions will help you to explore your authenticity.
Do you know yourself? Get in the habit of asking yourself two crucial
questions: "Why do I pursue the work and the life that I do?" and "What do I
act like during the most fulfilling times of my life?" Your answers will help you

Page 22 of 60
spot the defining thread of your experiences, and they will lead you to your
purpose.
Do you know how to listen -- and to hear? Most leaders think that not
speaking is the same as listening. But hearing people's words is only the
beginning. Do you also hear their fears? Their intentions? Their aspirations?
When you start to hear at a deeper level, you'll start getting information from
people. Better yet, people will know that you care about them, and they will
eagerly commit to you.
What's your appreciation ratio? In the business world, confrontation,
criticism, and even hate are more socially acceptable than expressions of
appreciation. That's too bad, because appreciation is a truly value-creating
activity. It energizes people, and it makes them want to exceed their goals
and perceived limits.

Page 23 of 60
 Natural Leader Top
For Rayona Sharpnack, sports was always a second language that her body
spoke fluently. She grew up pitching and batting against three older brothers
in rural Susanville, California. "There weren't many other kids around, and
there were hardly any girls," she explains. "So if I wanted to play with the
guys, I had to be good." And she was incredibly good. As a sinewy 11-year-
old with stubbornly curly hair, she set a Junior Olympic record by throwing a
softball 189 feet. Five years later, the driven teenager won her state's tennis
championship in both doubles and singles. In college, she earned a physical-
education degree at a time when few women entered the field, and in the
early 1980s, she became the first player-manager of the most profitable
franchise of the International Women's Professional Softball League. Today,
still a muscular and graceful athlete at age 49, she is a shortstop for the
California Express, a women's professional softball team that took second
place in the league's 1999 world championships.

Sharpnack describes her athletic talent as a meld of instinct and

preparedness -- both mental and physical. "When people watch me play, they
might think, 'How did she know to go there?' " she says. "It's almost as if I'm
moving to the ball before I see where it's headed. Some of that is the dance
of the body coupled with experience and working on instinct. But more than
that, it is a state of being -- a complete focus and presence of attention that I
have to maintain every moment that I'm out on the field."

That insight is precisely what Sharpnack applies to her other career --

teaching leadership to businesspeople (mainly women) inside some of the
most powerful companies in the world. Leadership isn't about doing,
Sharpnack insists. It's about being. You are more likely to succeed if you
concentrate on transforming your mental framework, rather than on
memorizing mechanics. Her approach revolves around self-discovery, and her
personal history in sports is merely a reference point. For the real lessons,
she sends participants into their own psyches to explore their views of the
world, their companies, and themselves -- and how those perceptions shape
their behaviors and opinions.

That philosophy has become the core curriculum behind the Institute for
Women's Leadership, which Sharpnack founded in 1991. Most of each three-
day seminar on "breakthrough change" involves conversation. Drawing on
her academic background in linguistics, business, and psychology, Sharpnack
guides participants through a process of unlearning what they assume to be
true about what they can (and can't) accomplish. All of this talk, participants
agree, changes how they walk the walk of leadership.

"Quite simply, it was a life-changing experience," says Vivian Groman, 43, a

senior VP of finance and corporate administrative technology at Charles
Schwab Corp., who took Sharpnack's course in 1997. "You walk in with a
challenge, some mountain that you don't think you can climb. When you walk
out, you've built a higher mountain that you know you can climb."

Page 24 of 60
Sharpnack primarily targets women simply because she thinks that they have
a natural affinity for her leadership methods. And she has a big-picture theory
as well: The more women that she trains to lead critical, business-changing
projects, the more women will get promoted, and the more the balance of
power inside companies will shift. So far, her model has produced compelling
business results. Women at Schwab felt that the training was making such a
difference in the company's competitiveness that they asked Sharpnack to
share the class with male colleagues too. The feedback from the coed course
was so positive that Schwab added the class to its regular HR-training
offerings.

Between the company-specific sessions and the open courses that she has
led over the years, Sharpnack has amassed an alumnae base of several
hundred women from such companies as Apple Computer, Boeing, Compaq,
the Gillette Company, Hewlett-Packard, Levi Strauss & Co., and Wells Fargo.
Her alums are some of the most impressive and successful change agents in
business today. (See "Leadership Moments," pages 272, 276, and 280.) Some
women even admit to carrying Sharpnack's softball card in their wallets like a
sort of leadership talisman.

In a series of interviews with Fast Company, Sharpnack shared her insights

about the dynamics of leadership and change -- from how to build a
"cathedral of change" to how to have a "conversation for action."

How to "Be" a Leader

What is different about your approach to leadership?

For most people, leadership is about "what you need to know" and "what you
need to do." But Amazon.com sells more than 1,000 books that will tell you
what you need to know and what you need to do. We work on who you need
to be, which we call the "context." It's the being aspect of leadership that
enables breakthroughs in what people do and what they learn. In my classes,
I'm going for those "aha" moments, which are really the ignition and
illumination of the genius of the participants themselves. That experience is
much more meaningful and relevant than trying to learn someone else's
shtick or methodology for leadership.
What do you mean by "context"?
Context can be an individual's mind-set or the organizational culture. It
includes all of the assumptions and norms that are brought to the table.
Context is perception, as opposed to facts or data. People don't go off and
design their context -- they just inherit it. So take anything from racism to
sexism to what you think you can and can't do: It's all pretty much
inheritance. It's conversations, oral tradition, all that kind of stuff. When you
slow down enough to examine those ideas, you might realize, Oh my gosh!
I've been operating as though everyone else knew more than I did, just
because back in grade school I was put in the bluebird reading group, instead
of in the faster robin group. So it might be that kind of a deep individual
insight that allows you to see that your whole context has been that you're a
second-rate player.

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Most change programs inside of companies don't work because they address
content (the knowledge, structure, and data in a company) or process (the
activities and behaviors), but they never address the context in which both of
those elements reside. The source of people's action isn't what they know but
how they perceive the world around them. And that's a very different thing to
work on than knowledge or information.
How do you change the way that people perceive the world?
I'll give you an example from my life, something personal rather than
professional. When my daughter Chelsea was eight, I coached her softball
team. On one of the first days of practice, I have everyone try to do some
batting. I take a really soft, spongy ball, and I toss it to the first girl. She's
standing maybe 10 feet away, I'm throwing baby tosses, and she screams
and hides her head. So I say, "Hey, no problem, Suzy. Go to the back of the
line. That's fine. Betsy, you step up." Next girl in line. She does the same
thing -- buries her head and screams. So I'm realizing that this is going to be
a really long practice if we don't do something different.
I go out to my car where I have my handy whiteboard markers in my
briefcase. I take the bag of practice balls and draw four smiley faces -- red,
black, blue, and green -- on each ball. When you look at a ball, all you see is
one smiley face. I go back out and call the girls back over: "Okay. We're going
to play a different game this time," I say. "This time, your job is to name the
color of the smiley face. That's all you have to do."
So little Suzy stands up, and I toss a ball by her. She watches it all the way
and goes, "Red." Next girl, Betsy, gets up there. Betsy goes, "Green." They're
all just chirping with excitement because they can identify the color of the
smiley face, so I say, "Okay. Now I want you to do the same thing, only this
time I want you to hold the bat on your shoulder when the ball goes by."
Same level of success. Excitement builds. The third time through, I ask them
to touch the smiley face with the bat.
We beat our opponents 27 to 1 in the first game. I can't tell you how many
Little League baseball games I have been to where parents and coaches are
yelling at the boys, "Stand up straight. Hold up that bat elbow. Dig in that
back foot. Rotate those hips." They're giving all kinds of detailed instructions
to get the kids to change their actions -- instead of doing what I did, which
was to work hard on shifting the kids' perceptions. When you shift people's
perceptions, their actions follow.
How would that approach play out in a business setting?
A few years ago, one of my students, a marketing director at a high-tech
company, applied this concept in a really powerful way. She worked for a
software developer, and it was company practice to send out documentation
with all of the company's new software releases. She and her team were
brainstorming ways to cut their budget. They looked at every way they could
think of to reduce costs: Switch to a lower grade of paper, use soy-based ink,
choose a smaller font, do more with graphics, cut down on words. She
realized that the context for the conversation included the assumption that
they had to have documentation. So they came up with the idea to send
postcards to their customers. These cards had four options. The first one was,
"Don't send documentation. We don't read it anyway." The second one was,
"Don't send documentation. We'll use tech support." The third one was,
"Don't send documentation. Save a tree." And the fourth one was, "Please

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send documentation." Only 5% of their customers wanted documentation,
and the company saved $400,000 that quarter. Now, that's an example of
hearing context and shifting people's perceptions of how to move forward --
and then linking it to the bottom line.

Cathedrals of Change, Conversations for Action

Having a breakthrough idea is a great start. How do you turn that

idea into action?
Relationships are absolutely critical. And typically, a relationship is viewed
from a personality context: Do I like you or do I not like you? Are you my type
of person? Is your style a good fit? We don't go there in our program. I mean,
it's always a bonus if you can get personalities to mesh, but it's not a
prerequisite to being able to lead profound change. What is a prerequisite is
having a relationship with a foundation that is strong enough to build what I
call a "cathedral of change." And a lot of people are trying to build cathedrals
on these puny little foundations that won't support the structure.
The basic point: Trust is absolutely fundamental to getting anything done.
And in organizations, it's one of the biggest issues that people don't talk
about but that impedes progress. For most of us, trust is like money in a bank
account -- units in, units out. If you meet my expectations over time, then I'll
put some coins in the bank. Clink, clink, clink, clink -- and now you've earned
my trust. And if you don't, or if you upset me, then I'll take some coins out.
That's one whole dimension of trust, but it's not the only one. Another
dimension of trust comes in when you give trust to people before they've
earned it. Now, that's a heroic moment. To give trust before a person has
earned it is a very risky deal. And most organizations would tell you not to do
that because your reputation is on the line. Your credibility is on the line.
You're gonna trust somebody who you don't even know? Well, we do it all the
time. We just don't notice it.
Are there things that a leader needs to know?
You have to know how to have what I call "conversations for action."
Everybody spends time in meetings where there's a lot of talk and not a lot of
action. That's because we don't identify which kinds of conversations result in
performance. For instance, in a football game, you have a conversation going
on in the huddle. The quarterback says something like, "Okay, drop back,
pass protection, sprint out right, pass on two." That's a set of instructions.
He's asking that the front line form a V-shape protective shield around him so
that the other team doesn't crush him. He's requesting that the two folks on
the end go down the field, cut across it, and wait for him to throw them the
ball, and he's promising that he's going to drop back, kind of veer off to the
right, and throw a pass to one of those two people. That's a conversation for
action.
There are other conversations going on at the same time. There are people in
the press box who are saying, "Well, there's Steve Young again. The last time
he was in this situation, blah, blah, blah, blah." Nothing that they say has any
effect on the game at all. Then there are the people in the stands who are
saying, "Gee, I really don't like these hot dogs. The ones at Price Club are so
much better." Not a bit of influence on the game. Well, the same thing
happens in organizations. People are having conversations for action. They

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are attempting to move the organization into the future, or to move the
product into the marketplace. And then there are the other people who are
sitting in the stands or sitting in the press box who are talking about what
could or should or would have happened.
In the same way, there are conversations that happen on an individual level
that head somewhere, and then there are those that just spiral downward. A
couple of years ago, I was talking to a colleague, and I was kind of whining
about somebody I worked with who was being an ogre. And my colleague
listened and then said, "Okay, I just have one question. What are you building
a case for?" And I said, "Well, he's domineering, and I'm getting screwed
over." And she asked, "Is that what you're committed to?" I said, "Uh, that
would be no." And she didn't say another word.
I took out my Post-its and wrote this question: What are you building a case
for? I stuck it to my computer. I was so quiet the next week. Whenever I went
to open my mouth, I noticed that I was preparing to build a case for
something. Now, if I were building a case for the transformation of gender
equality on the planet, then okay, that's a conversation I want to have. If it
were a conversation to whine or complain about traffic (about which I can do
nothing), then I could either have that one or not have that one. If it were a
conversation based on gossip or a rumor, then I wouldn't have that one. I
became hyperaware that everything coming out of my mouth was building a
case for something -- often, for something that I wasn't really committed to.
You talk about breakthroughs on a personal level as well as on a
company level. How does that happen?
You start out with a commitment to acquire a competency. You want to be
good at something, so you kind of existentially declare your commitment by
saying, "I want to be something. I want to achieve something." Then you go
into learning mode. As soon as you learn, you've got to practice. Only two
things can come from practice -- failure and success -- and they both have to
come before any real learning can happen. But we have a love-hate
relationship with success and failure -- that is, we love success and we hate
failure.
That's more of an adult phenomenon, by the way. When little kids are first
starting to walk and to pick up and drop things, they're fine. There's no
judgment associated with those things. Everything's an experiment to them.
But by the time people get to be adults, they have almost no tolerance for
failure. And that is a very, very dangerous context to have if you want to be a
lifelong learner, because the only way to learn is through failure. That's
another one of those "aha" moments: when you realize that people work in
organizations that religiously try to reduce the risk of failure, when the only
way to grow is through experimentation, practice, and risk.

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 Boooorrriinng!!!
That's exactly what Philippe Gaulier teaches leaders not to be. He uses theatrical techniques in
order to help would-be leaders find their inner clowns.

There is a chair on the stage. Two competitors circle it. When the music
stops, only one of them sits. That person gets to be Major -- the power, the
leader, the force. The loser becomes Minor and slinks away. It's a child's
game -- musical chairs -- but this time, it's teaching a lesson in leadership.

In this game, when the music stops, the person who grabs the chair doesn't
just sit in it -- he possesses it. Major swells to fill the chair. He revels in his
new seat, declaring himself born to that perch, destined for that role. He is
not gracious, not for a moment. He is loving every minute of sitting in that
chair. And watching him, so are we. There's something so right about his
sitting there. It's perfect! We enjoy seeing him in that chair even more than
we would enjoy sitting our own precious ass down in that winning seat. And
Minor? What of Minor? Minor is off to the side -- and cleverly drawing us to
him. He's full of entrancing second-banana movements, from that droopy grin
that he wears on his face like a wilting flower in his lapel to the abject
crawling that has become his new way of getting around. His version of losing
is actually quite winning: It's touching, charming -- and just as perfect as
Major's boastfulness. Minor, too, has touched us. He, too, could convince us
of anything -- even that crawling around on a dusty floor is fun. So completely
have Major and Minor connected with an inner chord of emotion and energy
that we would follow either of them.

Major and Minor are, in fact, learning to be leaders. But they're studying a
type of leadership that goes beyond the traditional requirements of being
clear, motivational, and inspirational: The leadership that they're learning
teaches people to go for the jugular. Major and Minor are among the 26
students in this class who are learning to tap into the very core of leadership
by drilling past their rational minds into the depths of their emotional
responses. It's at this core level that people commit their deepest loyalties to
strangers. Think of the way that music takes possession of you: truly, madly,

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and deeply. Now imagine leadership that touches you as powerfully, as
primitively, and as completely. That is the essence of leadership.

The class is taught at L'école Philippe Gaulier -- a nontraditional school in

North London that rearranges everything that we thought we knew about the
art of leadership. It is a school for leaders, though it is not a leadership
school. The principal -- the master -- is a clown. Philippe Gaulier, 57, makes
sure that his school focuses on one essential objective: how not to be boring.
Without knowing it, most of us are deeply boring. Deeply. And leaders are the
most boring of all. What they don't understand is that being boring limits
their power and undermines their effectiveness. Whenever Gaulier catches
even a hint of " boring" in his class, he looks the offender in the eye and
growls, " You are boooorrriinng! Adios immediately!" Whether you are
onstage in a theatrical production or onstage in the real world -- the " theater
with consequences" -- when the spotlight shines on you, you must become
larger than life.

Gaulier is pleased with the most recent Major and Minor, as they were
anything but boring. They performed as leaders -- an art learned best in
reverse: First you master the performance; then you become a leader. Two
other students begin a new game. When the music stops, a woman plops
herself down in the chair as if her body were a bag of groceries and becomes
Major. Her eyes fix on Minor as she engages the loser in the kind of dull
conversation that strangers take part in: " Where do you come from?" she
asks. " I come from New York," Minor answers. " And you?" This isn't
leadership -- it's chitchat. No one is listening; no one cares. Major may hold
the seat of power -- the office of leader -- but she has zero command of us,
her followers, her audience.

Gaulier withstands only a minute of this misery. He then abruptly turns on the
music -- boooorrriinng! -- and banishes this Major and Minor. Adios
immediately.

" People are ready for Gaulier when they sense that there is more inside
them than what they have allowed themselves to express," says Isabelle
Anderson, 49, a former student of Gaulier's who uses some of his dramatic
techniques to coach CEOs, authors, and business leaders in communications,
public-speaking, and presentation skills. " They may feel that they've done
pretty well, but significant power has eluded them."

When a promotion, a sense of ambition, or a need to perform forces people

out of their safety zone, says Anderson, those people " step out of
themselves and into a larger identity. That's when they start to feel that they
are not good enough to shift to the next gear."

Ronald Reagan understood this -- as an actor playing a leader playing a

leader-playing-an-actor. There is an art to understanding posture, voice, and
the dramatic moment. Great leaders instinctively know it; others learn it.
Gaulier tells his students that they don't need to play a role -- they need to

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play themselves comfortably. He teaches theater techniques that help people
embrace their humanity.

A Too-Nice Woman

Once upon a time, there was a woman who was much too nice. Just how nice
was this too-nice woman? This woman was so incredibly nice -- that nobody
liked her.
The too-nice woman runs around the room, per Gaulier's instructions. When
you're running, he says, your body reveals the role that's captured you, the
role that limits you: stiff and subdued, light and childish, aggressive and
energized. When you're moving, you can't hide. Generals know that -- and so
does Gaulier. This woman's step is light; she positively prances. There is an
angelic smile on her face.
" You are too nice," Gaulier says. The woman even enjoys the reproach. For
her, " too nice" is just right. But then Gaulier lets the air out of her tires: " You
are so nice that you are not convincing. You are boooorrriinng!" It's true. She
is so nice, she is not even very convincing at being nice.
Gaulier quickly performs surgery on her soul. He makes her aware of how
trapped she is in the role of helper. Indeed, he makes her aware of how
everything that she does -- the way that she walks, breathes, talks, glances
at another person -- limits her effectiveness. Leadership is communicated
through more than just ideas, vision, or values. Gestures can also
communicate leadership -- swiftly and surely. The too-nice woman doesn't
have what it takes to command attention. And Gaulier won't let her off the
hook until she does.
Boooorrriinng? Gaulier is eminently qualified to make this judgment: He is a
Zen master in Dilbert suspenders. Everything about him contradicts
everything else about him. Since he's French, you expect a high degree of
formality. You expect to be reprimanded for anything less than perfection.
But Gaulier loves risk and foolishness. He wears the beard and the patches of
Jean-Paul Sartre and the round glasses of the Nutty Professor. You expect him
to expound on theory. Instead, you get demonstrations on how to love what
you do -- how to love it so much that pleasure becomes the center of your
power and authority. Take total pleasure in everything you do, insists Gaulier,
even the lonely job of leadership.
But our young Mother Teresa can't break out of her too-nice shell. Having
been told that she is boring, she becomes even duller. Gaulier asks her to act
like any animal she wants. She opts for a swan -- not an inspired choice! In
fact, it is an insipid choice: She is already a lot like a swan, so in mimicking a
swan's behavior, she is still stuck in her old routine.
" Choose your punishment," Gaulier demands. " A kiss or a whack." Since this
woman is boring, Gaulier makes her choose between two punishments that
afford her no safety: She must either convince another student to kiss her --
not an easy thing to do in a room full of strangers -- or accept a whack.
Our Sister of the Loving Heart again plays it safe: She decides to take the
whack. Gaulier bends her at the waist, her arms pinioned behind her, and
karate-chops her back. His whacks are no more uncomfortable than a typical
Swedish massage. Still, you feel them. Your butt in the air and your head
down at your ankles, you feel broken in two. Afterward, you sit with the

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others who have been condemned for being boring. And then later, you get
up and try the exercise again.

The Sin of Being Boooorrriinng!

One thing that Gaulier insists on is that his students become bigger human
beings. " People make themselves smaller in every encounter," he says. " If
you're in the light, either onstage or in someone's attention, you can't afford
to be small. You're not just the space around your shoes. If you don't take
pleasure in even the smallest things that you do, then you don't have an
aura.
" You have to be so charming," Gaulier tells his students, " that people think,
'If my daughter marries this man, or if my son marries this woman, I will be
fucking happy.' If you don't exude pleasure, then you can't be an actor -- or a
leader. With 2,000 spotlights shining on you, you have to emit a beautiful
freedom. You have to pretend that you're not scared."
Leadership can be stressful. And during moments of pressure, people tend to
close up. That's true for an actor onstage, as well as for a leader on whom all
eyes rest. When we occupy a position that requires more of us than usual --
making a toast at a wedding, presenting to a committee of VCs, rousing a
team or a board of directors -- we contract. Courage leaves us, and we
deflate. The result is that we don't convey our ideas with conviction.
Leadership means selling yourself along with a promise -- of ideas, products,
or missions. But all too often, when we have an idea or a product to sell,
instead of rising to the challenge -- Major swelling to fill that chair! -- we
shrink from it. " If your presentation becomes diminished, it is because of the
contraction that goes on in your confidence level," explains Isabelle
Anderson. " To put color around it, to make it bold, would go against the grain
of your normal life."
So how do you act with the kind of absolute conviction that makes others
follow you? Think of making a toast at a friend's wedding. All eyes are on you.
And all of those stares, all of that attention, all of that expectation makes you
feel diminished. You say all the right things, but your voice still sounds fake,
small, and tinny -- like that of a B-movie actor. You have big words and big
feelings to convey, but you are not their equal. Your words lack the right
combination of comfort and conviction. How to change that?
" Expressing your conviction and position by just being you, by being natural,
is great," says Anderson. " But if you're so natural that you're not in a
heightened energy state, then you may as well be boarding people on a bus.
Gaulier's work is about being bigger than your image of yourself, not just
different from it."
Reaching a " heightened energy state" is what Gaulier teaches. In order to
lead, you have to command people's attention -- and steal their hearts.
Simply setting out to be more interesting won't fix the problem. Racking up
real-life experiences or winning awards to put on your résumé may give you
more to talk about, but neither of those things will lessen your chances of
being boring. The reason that people are boring is because they follow a bad
script.
" People begin a conversation with an aggressive tone," says Anderson. " The
first instinct in communication is 'I'll show you!' The hidden script that most

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people bring to every contact is a confrontational one -- a tacit 'prove it-prove
yourself' attitude. We do this instinctively; we're not even aware of it.
Because we are self-conscious, we enter a conversation anticipating
rejection, conflict, or a need to protect ourselves. Those emotions constrict
us. Self-consciousness creates a barrier between people."
Moreover, self-consciousness stops all action. It isolates people, and, worst of
all, it is boring. Bore people, and you lose their attention -- and permission to
lead them. Gaulier tries to draw what's not boring out of a person. " It's a
shame that we walk around being so boring," laughs Anderson, " when we
have the potential not to."
A boring leader is never more than a manager. A boring Nelson Mandela
could not have freed South Africa from apartheid. A boring Jack Welch could
not have inspired General Electric's businesses to assume first or second
stature in their industries. A boring Steve Jobs would have meant the death of
Apple Computer long ago, rather than its birth or rebirth.
Says Gaulier: " Theater is the extension of life. The same laws govern one
and the other."

Open-Heart Surgery of the Soul

To train athletes, you make them run. To train leaders, you do -- what
exactly? Teach them management? Teach them the numbers? Teach them
confidence? Or perhaps you teach them how humanity really works: how to
tap into what goes on beneath sophisticated human surfaces; how to find the
connection that makes perfect strangers identify with an idea, a project, a
vision, even the unknown. Isn't leadership, after all, a higher form of selling,
where what you're selling is the future? If you want to sell shares of the
future, you need more than off-the-shelf business skills.
What triggers that connection, what overrides anyone's tendency to be
boring, is the language of complicity. It is the language of agreement,
cooperation, and communication that connects leaders to their constituency
of listeners, followers, and customers -- striking deeply and directly at their
emotional core.
Pleasure is the great glue stick. When performers are having a great time --
when they're in control of their own power, and they have access to the
power of others -- everyone knows it. If a performer is struggling or distracted
or unhappy, you sense it instantly. You distance yourself from everything that
performer says. There is complicity between leaders and their followers, the
same complicity that exists between actors and their audience. " In a great
performance, no one is outside the experience," says Gaulier. " Everyone
shares in it. It's intimate and joyful." A great performance is sharing a secret,
a wink, or a joke with the audience. It's the moment when you connect with
your followers. Once that connection has been made, you can ask for
whatever you want -- and get it. And out of that, says Gaulier, will come an
action, a future.
How do you learn to speak the language of complicity? By finding the fixed
point, the true character, the real you in all of the roles that you play. You'll
know that you've found it when you feel totally at home no matter where you
are.

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To help you find that point, Gaulier strips you of seriousness. Under all of
those responsibilities, fears, and instincts for safety is your real character. He
knocks his students back to their basic identity, mocking their appearance in
order to reach the source of their raw energy -- the fixed point, the truth from
which they derive the greatest pleasure. " A lot of this work throws your
identity into the mixing bowl," says Anderson. " That raw energy that Gaulier
searches for is who you are and who you have the potential to be."
Once you find your true character, you'll be able to find pleasure in the
performance itself, in the work itself. A leader who feels pleasure gives off a
sense of heightened energy. And to that end, Gaulier teaches serious
professionals how to play the clown.
The clown is the most complicit character. It is the slightly fumbling
aristocrat, the person dancing like a fool at the edge of all risk. The clown is
the character who engages our sympathies, who speaks for us, who says and
does the unspeakable, the undoable -- and, in doing so, becomes a lightning
rod for our emotions.
Gaulier looks for the clown in all of his students. And he knows just where to
find it: It's usually the part that people play with the most seriousness. " This
is the open-heart surgery part of the course," he says. " I can see people's
souls, and I reveal them. That is the point of my classes. That's why you
should be not boring but joyful -- so that others can see your soul."
Clowns play to the heart. They have nothing to lose, and so they have all of
the freedom that they want. That is the pleasure to which others connect.
Performing your most serious characteristic as a clown lets you laugh at it.
Once you are no longer attached to boring appearances -- once you stop
taking yourself so damn seriously! -- you are free to act with pleasure. Clowns
perform for an audience and don't care if people laugh at them. And because
they don't care, they are free.

Send in Your Clown!

Gaulier is not finished with Ms. Too Nice. He turns to the class and says, " She
would make a great Salvation Army clown." Under Gaulier's gaze, it's obvious
what is wrong with this woman: her utter seriousness. She is playing " nice"
as if she were Meryl Streep, rather than Meg Ryan. It's that seriousness that
traps her. We stop listening when she speaks. We lean away from her. She
does not capture us. It is a subtle but profound point: She undermines her
own authority by playing the " nice" role with such utter unbreakable
seriousness.
" The clown character allows you to show your greatest strength," says
Gaulier. Play it, and you release the part of you that is too serious, too
wrapped up in appearance, fear, self-consciousness, and old habits. " Often,"
he continues, " your most beloved role keeps you small. This woman should
try playing Medea or Clytemnestra" [two furies of the stage whose anger runs
wild]. Gaulier is not suggesting that Ms. Too Nice start stabbing people. He is
suggesting that she play the part of the good guy not as the role of a lifetime
but as a laughable Salvation Army clown. She is to play her serious side for
laughs. That will give her pleasure. That will set her free. Says Gaulier: " She
thinks of herself as a dancer -- graceful, light. But that ideal is not healthy.
Her time to be a dancer is over."

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Ms. Too Nice is about to learn how to laugh at her serious side. Once she
does this, she will become more accessible to both herself and to others.
Heroes have their own distinct humor. This woman is about to discover hers.
She begins acting the part of the clown. She starts dusting people off,
wearing a big, stupid grin whenever she does something servile. Every
gesture that she used to perform by rote, she now invests with thought. A
smile is exaggerated. A nod is goofy. She starts enjoying herself: The role is
giving her pleasure, and her seriousness is melting away. She is nice
surprisingly. Later in the day, her caring role acquires a bit of an edge. Her
nurturing gestures become less automatic, more subtle and thoughtful. When
she defers to someone, she does it with a flourish, as if her doing so were a
gift. The transformation is riveting. This woman has become larger.
" Make me wonderful," people say. What they really mean by that is " Don't
change me." L'école Philippe Gaulier is a school for leaders: It makes people
wonderful, and it changes them.
You walk through a tear in the curtain of reality when you come to study with
Gaulier. It is the dimension of theater, and it's a bit unreal. L'école Philippe
Gaulier stands out in the dark, dreary muck of London like something out of
J.R.R. Tolkien's " The Hobbit," tucked away in the London suburb of
Cricklewood. On the opening day of class, 26 people are running in from the
drizzle, entering the converted church hall. Pagans? Hobbits? You can't be
sure, not even when they introduce themselves as Philippe Gaulier's
students.
They are students, but they are also teachers. On first impression, many of
them seem riveting. They make eye contact. Their open faces draw you in.
They fix themselves in your memory like a powerful movie character etched
in time. How do they accomplish that with just a handshake and a hello?
Pleasure. Complicity. Connection.

The School of Humanity and the Theater of Complicity

Gaulier was not born not boring. For half his life, at least, he was quite dull.
Growing up in Paris's 11th arrondissement, Gaulier lived in a part of town that
was bordered by both a prison and the cemetery that houses the bones of
Simonie-Gabrielle Colette and Alexandre Dumas. To a sensitive soul, the
neighborhood was a spiritual Three Mile Island. The atmosphere was seriously
polluted, emotionally radioactive, and full of way too much seriousness for
young Philippe.
" When I was 26, I was faced with a crisis," recalls Gaulier. " As an actor, I no
longer got any pleasure from my job. When you don't get pleasure from your
work, you don't have any chance of working at a more expert level or of
feeling freer. I wanted to be a tragic actor, and every time I tried, I flopped. A
friend of mine, an absolutely gorgeous tragic actor, said to me, 'I must have a
horrible destiny. I have been a bastard, and I have eaten with the dogs.' That
didn't happen to me. I didn't have such a dramatic life, but I did want to live
more fully. I was blocked. I didn't know what to do, so I decided to go to the
Lecoq school. I stayed there as a student for two years and then as a teacher
for nine more. At Lecoq, I discovered the pleasures of work and life."
Under legendary acting teacher Jacques Lecoq, founder of École Jacques
Lecoq, Gaulier learned a secret: You can achieve any great vision that you

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have of yourself -- if your work gives you pleasure. That is how an actor or a
leader inspires followers, attracts believers, wins contracts, and builds visions
that become real. Gaulier heard the primitive music of leadership at the
Lecoq school.
Lecoq founded his school in December 1956. When Gaulier joined Lecoq as a
student 12 years later, a revolution was sweeping across Paris. " The gods of
the establishment were falling; they were in hell," Gaulier says of 1968, a
year that saw students take to the streets in cities all over the world. Now, 32
years later, in cities all over the world, the establishment is once again falling
-- this time in business. The old-economy-establishment companies are
struggling. The new clowns, mavericks, and disrupters are on top. The scripts
are being rewritten, and the roles are being reversed.
Lecoq, who died in 1999, ran his acting school as a sort of school of
humanity. " The first students were not only actors but also psychologists,
ministers, doctors, architects, and writers," says Anderson. In 1991, Gaulier
moved to London, where he set up his own school. Among his former
students are Roberto Benigni, Helena Bonham Carter, and Emma Thompson.
The most subversive thing about this kind of teaching, says Gaulier, is its
emphasis on pleasure. Work has many parallels to method acting. Actors
such as Robert De Niro and Al Pacino dwell on pain, loneliness, and fear. They
use those qualities to boost their art -- much in the same way that most
overworked businesspeople sacrifice their lives to have more powerful
careers. The problem is that under this philosophy of work, actors tend to live
tormented lives. Gaulier saw no future in this route. He took the opposite
route: complicity and clowning. Not only is this route more powerful, he
believes, but it also translates into a happier, less stressful life. Leadership --
command of the stage -- comes from one thing: pleasure. And you can't
communicate pleasure unless you feel it.

The Primitive Script in which Business Is Written

Remember how your best professors took command of you? They did it by
following the laws of melodrama. Forget information. Professor Wonderful
would lean forward and then speak in a hushed, conspiratorial voice. She
wouldn't talk numbers; she'd talk big issues: life, death, love, misery. If
lecturing on changes in life expectancies, for example, she'd dramatize how
only since World War II have women's life expectancies come to exceed those
of men. She would physically place herself in a story, acting out the role of an
observer at a Civil War graveyard, walking to the front of her classroom as if
over burial grounds. Once there, she would point out a family plot, reading
the gravestones of a succession of three wives: " Hezekiah, who died at 23
during childbirth, is over here; Rebecca, mother of two, lies beside her, dead
at 28; Emily is a few feet away, dead at 18; and at the summit lies the
husband to all of them, Thomas, dead at 48." She wouldn't just tell you a
story; she'd bring you inside a story. That's melodrama.
Melodrama is not the damsel tied to the railroad tracks but the big issues --
the good, the true, the beautiful, and the evil that must be conquered. It's the
basic, primitive script in which business is written. Think of most
advertisements: You're dead if you don't buy an Armani suit. You're selling
your child up the river if you don't invest in John Nuveen securities. You're

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declaring your love if you give your mate a diamond from DeBeers.
Melodrama is the script of anyone who persuades you to buy or do anything.
There is a point in Gaulier's course when you take what you have learned
about complicity -- about finding your fixed point -- and you put it to work on
something larger. " Melodrama demands a person to be big, to be grand,"
Gaulier tells his students. " How big do you have to be in order to reach your
audience? Most people don't come close to being the right size. Most people
are nice. Or small. Or self-constrained. They're so boooorrriinng that nobody
sees them." The actor who takes on melodrama must " perform for the gods,"
says Gaulier.
Gaulier takes us back to the origins of melodrama to show us why actors had
to become bigger than life to command their audience's attention. " It was
always dark onstage, and the 'gods' -- the peasants sitting way up in the
balcony -- couldn't see the actors," he says. " What did the audience
members have in their stomachs? Two bottles of wine if they were on a diet,
three or four if they weren't. It's the same response that we confront today,
with people being distracted by a thousand things: In the old days of theater,
everything swam in front of the audience's eyes. Move your body, and you
would confuse the audience.
" To play melodrama in that setting," Gaulier continues, " one's actions had to
be big. Melodrama is theater for poor people. Actors and leaders don't
naturally use gestures large enough to be seen by an audience that is far
away -- either physically, sitting in the balcony, or far away in the sense that
audience members are removed from your message by uncertainty or
cynicism. They must learn to offer a flower with panache. They must learn to
play to the crowd."
Gaulier teaches his students that melodrama is not exaggeration. It is relying
on a script of emotions, suffering, and sympathy. He asks a young woman to
stand before the group and say, " My sister sold her body to buy me this
chair." He tells her that she must break our hearts when she says it. If she
doesn't, then she will have failed in taking command of us. Try as she might,
she can't touch us. At first, she overacts: " My sister sold her body to buy me
this chair," she says, pretending to sob and then hanging her head. Gaulier
knows that no hearts have been broken. Melodrama is in the small gestures,
he tells her. She must win her audience's sympathy before doing anything
else. She must win it before she even says the line.
" Look up, but lower your head," Gaulier says. That simple gesture melts us. It
is the perfect gesture of complicity (not to mention the fetching look of
Princess Diana). But the student still can't get the line to work for her. Gaulier
asks two young men to stand close behind her. Just as she starts to speak the
line, they are instructed to lean in and gently kiss her neck. They perform this
bizarre exercise, and she zings the line home. Her voice opens. It's soft yet
clear. Gaulier has given her a cattle prod of pleasure. Being kissed -- twice! --
is enough to stimulate her physically so that she brings pleasure into the line.
She connects us to her emotions. She fills the stage. We are with her. The
ridiculousness of the line disappears. We feel the music, the swell of her
emotions.
The kissers disappear; they are no longer needed. " Once you have that
language of complicity in the body," says Gaulier, " you carry it with you. You
can then use it easily, as needed."

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Gaulier believes that once you hear or feel the power of melodrama in your
delivery, it stays in your body. You don't forget it. You remember how to
capture the audience, how to catch its sympathy. Awareness of the body is
intrinsic to assuming the full size of your humanity.

Getting in Touch with the Leadership Body

Gaulier says that the body can be the most convincing instrument of
leadership. He preaches an awareness of the physical and an appreciation for
it. " Sometimes you feel so light and strong that you want to fall in love -- or
buy a good sandwich," he says. " It's a beautiful day, and you want to bring
that physical awareness into your work."
Not all leaders achieve their full size, what Gaulier calls " aura." " There is a
kind of permission that you feel around certain people," he says. " Charisma
extends the body's reach a foot in all directions. We are bigger when we have
charisma."
Over dinner at the end of the day's workshop, Gaulier explains himself by
pointing out two sets of diners: At one end of the room are two white men
wearing shirts as pale as their skin. They are eating, moving only their hands
and mouths. Their bodies and faces are otherwise almost immobile. At
another table, a black family is smiling and sharing food. " Which group do
you think dreams more?" Gaulier asks me. I say, without hesitation, the black
diners. They are looser, spirited, communicating with their bodies. The white
men look static and entombed. " When you look at some people, your
imagination is ready to work," says Gaulier. " They give you more of an
opening. Those are the leaders whom people want to follow. Those are the
leaders who stimulate the imagination."
Leaders must display energy -- " but not raw energy," cautions Gaulier. "
Energy must be trained into impulse, spirit, élan." The problem with most
leaders is that, even if they have energy, they stay in their mind. " When you
stay in your mind, you don't have fun, dreams, or spirit," says Gaulier. " You
can't tell a story."
Gurus of leadership and directors of theater insist that their work is played
out entirely in the realm of the psychological. That's why most leaders, like
most actors, have developed terrific subtlety of range -- but only from the
neck up. To play the role of the leader in its entirety, facial and vocal
expression are not enough. Outstanding actors, like outstanding leaders,
have always brought their whole body to their roles.
Isabelle Anderson believes that training a leader's body should not stop with
developing strength, flexibility, or coordination. " You could do 100 sit-ups
and still look uninspiring," she says, " because doing sit-ups doesn't develop
awareness or consciousness of what's being expressed by your gestures." In
other words, leaders must develop a body that is an expressive instrument,
not just a physically fit instrument. They must develop an intelligent body.
" We have lost so much awareness of the body as an expression of who we
are that we lead only from the head up," continues Anderson. " But basically,
we are animals. When two animals meet, they size each other up quickly:
friend or foe? Dominant or submissive? We have only a fraction of time, a few
seconds, to establish our authority."

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Drawing on Lecoq's and Gaulier's teachings, Anderson analyzes bodies
according to energy types: "We are each predominantly a head, a chest, or a
hip personality," she says. "Head people are distinct because they walk with
their head leading the way--preceding their body by an inch or two." Head
people tend to define their roles intellectually and relate almost exclusively
with others through ideas, numbers, or concepts. They leave those who are
not on the same wavelength out in the cold.
"Chest people are concentrated in their lungs or their voice," says Anderson.
"They may walk with their chest out and talk in a constrained voice. For these
people, everything is about passion, breath, inspiration. They can be easily
exhausted: They may use up their energy on a role that is too inspired, too
airy, too difficult to follow.
"Hip people stand firm, hips and legs solidly planted, feet square on the
ground," she continues. "Their energy never flows any higher; they are not
inspiring. Hip people tend to be rooted, conservative. They give off a feeling
of heaviness and determination."
Assessing your energy type helps you locate your energy blockage. It helps
you find the points within you that are dead--the points that keep you boring.
Then it's a matter of distributing your energy so that it flows through your
entire body. As your energy moves through your body, you gain size and
authority. The most mesmerizing figures are those whose entire bodies
communicate energy. Those are the leadership bodies.
Anderson leads her clients in exercises that center their energy. Head people
stand barefoot and wiggle their toes. They are told to walk consciously--heel,
ball, toe. When you walk with energetic intention, you communicate that
intention to others. At the same time, you become unaware of others.
Magically, crowds clear. An intentional walker can part seas.
Anderson has a different exercise for chest people. She teaches them how to
breathe from the stomach, to break the blockage in their lungs. "Breath is
connected to the mind," she says. One exercise that she teaches chest
people is how to deepen their breath in order to help their mind become
steady and clear: "Put your hand on your abdomen, breathe in, and count to
10," she says. "Notice when you breathe whether that hand comes into your
body or away from it. When most people breathe in, their hand goes in. When
they breathe out, their hand goes out. That's wrong, and it shocks most
people to learn that. When you breathe in, your stomach should expand, so
your hand should move out. You become bigger when you are filled with
breath; you can use that to push out big emotions, to make complicit
connections.
"You must always have a deep breath under your voice," she continues.
"Otherwise, speaking is nothing more than your will. And that is never as
effective a sound as when speaking is your conviction. Breathe properly, and
your conviction will speak."
Hip people are instructed to lean forward in order to engage the mind and
become more leaderlike. The leadership body uses energy to communicate
spirit and excitement. "It is," says Anderson, "as much a requirement as
being slim, fit, or healthy."

Playing Yourself As Big as Life

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"So does one need to go to drama school to learn how to do all this?" I ask
Gaulier. No, he says: "Life is a school. Experience teaches you many things.
But often, we learn the wrong things from our experiences.
"A lot of events make us contract," he continues. "We learn how to play
smaller and smaller roles. A woman may come to think that she is stupid
because she has made a few bad decisions. Her voice grows quieter, and she
becomes less trusting. Her effectiveness diminishes without her knowing
why. Others see that she is performing the role of the frightened creature,
but she doesn't see that.
"Or a man may feel that he has no right to display his emotions because he
doesn't trust them. And so he, too, performs without pleasure. He cannot
dedicate himself to larger purposes. When experiences threaten us and make
us small, we have to knock back the limiting gestures that we've learned.
That's when the craft of theater is so useful. We can learn to become larger
characters by becoming more like our true selves."

39 Leadership rules Top

Ladies and gentlemen, the captain has turned on the "fasten seat belt"
sign. Please return to your seats immediately! Make sure that your tray
tables are in the upright and locked position, and please return your
seat backs to their full, upright position. Now brace yourselves: We're
headed for some turbulent times!

Not that the past five years weren't demonstrably nuts. They were. But
they were nuts in a generally recognizable way. Never mind all of that
easy-to-come-by venture capital and the ATM approach to IPO cash.
What really matters is how the past five years challenged us all to rip

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off our neckties, shed our standard-issue business suits, and, most
important, lose our Model T-type business thinking.

But that was the past five years. For the next five years, we're going to
go from nuts to flat-out freakin' crazy. For the next five years, it's
business on a wartime footing -- a high-stakes, high-risk, high-profile
event that is filled with uncertainty and ambiguity. And clear-cut
performance outcomes matter more than ever before. You can still
invent your own career, be your own brand, and promote your own
project -- you just gotta sprint and deliver.

Think of pre-1990 as the Age of Sucking Up to the Hierarchy. The Age

of the Promise 'Em Everything Pitch lasted from 1995 to 2000. The
next five years will be the Age of No-Bull Performance. Which means
that we're going to see leadership emerge as the most important
element of business -- the attribute that is highest in demand and
shortest in supply. And that means that over the next five years, we're
going to have to reckon with a new, unorthodox, untested, maybe just
plain freaked-out list of leadership qualities: 50 ways of being a leader
in freaked-out times.

1. Leaders on snorting steeds (the visionary greats!) are

important. But great managers are the bedrock of great
organizations. LEADERSHIP became sooooo coooool in the 1990s.
Crank out THE VISION. Harangue the troops. Stand tall in the saddle.
Management? That was for wusses, wimps, and dead-enders.

Well, I aim to amend all of that. Vision is dandy, but sustainable

company excellence comes from a huge stable of able managers. If
you don't believe me, then go read First, Break All the Rules: What the
World's Greatest Managers Do Differently (Simon & Schuster, 1999), by
Gallup execs Marcus Buckingham and Curt Coffman. Here's a boiled-
down version of what they found: Great managers are an
organization's glue. They create and hold together the scores of folks
who power high-performing companies.

Stop being conned by the old mantra that says, "Leaders are cool,
managers are dweebs." Instead, follow the Peters Principle: Leaders
are cool. Managers are cool too!

2. But then again, there are times when this cult-of-personality

stuff actually works! Okay, here goes the zig-zag, paradoxical path
of leadership in freaked-out times. It's true that there are times of
genuine corporate peril when no one other than a larger-than-life
visionary leader can get the job done.

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As far as I'm concerned, the first business leader who was able to
establish a cult of personality around his tenure was Lee Iacocca. When
he took over as Chrysler's chairman and CEO in 1978, that company
was on its deathbed. Chrysler turned to him the way the country turns
to charismatic leaders in times of war -- which is exactly how Iacocca
characterized Chrysler's competitive situation. The Japanese, Iacocca
said, were eating our lunch, and he was going to be the wartime leader
to rally the troops. The point is, there are times when you really do
need to turn to a leader who offers a broad, popular, galvanizing vision
-- someone who can symbolize a new approach to business.

3. Leadership is confusing as hell. If we're going to make any

headway in figuring out the new rules of leadership, we might as well
say it up front: There is no one-size-fits-all approach to leadership.
Leadership mantra #1: It all depends. Years ago, Yale professor of
organization and management and professor of psychology Victor
Vroom developed a model that was later adapted and popularized by
Ken Blanchard. Their point: We need to think about situational
leadership -- the right person, the right style, for the right situation.

I saw it at McKinsey & Co. when I went to work there. The firm had
gotten offtrack operationally, so the partners elected Alonzo McDonald
to be the managing partner. They didn't do this because they liked him
(he wasn't the cuddly sort), but because he was the right guy to fix
what was broken. McDonald did precisely what the partners wanted
him to do but were unwilling to do themselves: He busted the weak
performers, tightened up the control systems, and put the firm back on
profitable ground. After which the partners said, "Enough!" -- and
booted him straight to the White House to be assistant to president
Jimmy Carter and director of the White House staff. Motto: The
situation rules. Leader for all seasons? In your dreams!

4. When it comes to talent, leadership doesn't income-average.

It's a favorite one-liner these days: There is no "I" in team. What crap!
Is there anyone who really thinks that Phil Jackson won six NBA
championships with the Chicago Bulls by averaging Michael Jordan's
talent with that of the rest of the team? Yes, teamwork is important.
No, teamwork doesn't mean bringing everyone with exceptional talent
down to the level of the lowest common denominator.

Bottom line: Stellar teams are invariably made up of quirky individuals

who typically rub each other raw, but they figure out -- with the
spiritual help of a gifted leader (such as Phil Jackson at Chicago or Los
Angeles) -- how to be their peculiar selves and how to win
championships as a team. At the same time.

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5. Leaders love the mess. One leader who deserves to be
celebrated? That fabulous third-grade teacher your Charlie has -- the
one who sees each of her 23 charges as unique-quirky souls who are in
totally different places on their developmental paths toward becoming
their cool-peculiar selves. The third-grade teacher whom you should
avoid at all costs? The one who's got everything under control, with all
of the kids sitting at their desks, completely unable to express
themselves. There's no mess -- and no creativity, no energy, no
inspired leadership. You want leadership? Go find a fabulous third-
grade teacher, and watch how he "plays" the classroom.

6. The leader is rarely -- possibly never? -- the best performer. I

once read that the three greatest psychological transitions an adult
human being goes through are marriage, parenthood, and her first
supervisory job. In each of these situations, people learn to live and to
succeed primarily through the success of others. Which is why there is
no more important decision that a company makes than the selection
of its first-line managers.

Who are those people? Take a look at the former players from the
world of sports who become the best coaches and managers. Last
summer, Tommy Lasorda coached the U.S. Olympic baseball team to a
gold medal, finally defeating the Cubans. In his career with the Los
Angeles Dodgers, Tommy L. was a terrific manager. His own career as
a player? It lasted for three at bats.

The best leader is rarely the best pitcher or catcher. The best leader is
just what's advertised: the best leader. Leaders get their kicks from
orchestrating the work of others -- not from doing it themselves.

7. Leaders deliver. If you're aiming to be a real leader during the

next five years, then you need to mimic the pizza man: You'd better
deliver! For the past five years, ideas and cool have counted (which
was important). What counts now? Performance. Results.

8. Leaders create their own (peculiar?) destinies. During the

next five years, there won't be room for paper pushers. Only people
who make personal determinations to be leaders will survive -- and
that holds true at all levels of all organizations (including entry level).

Surprisingly, we've seen this phenomenon take place most often where
most people least expect to find it: in the military. First, war is the
ultimate improv venture. The most improvisational, least hierarchical
situation that I've ever been in was my 16-month stint in Vietnam. But
second, real-life experience in the Army or in the Navy teaches you
that you must have leaders at every level. So too in today's corporate

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wars. In this new world order, the real battle starts when the computer
gets knocked out, the captain gets killed, the lieutenant is gravely
wounded, the sergeant is hesitant, and suddenly the 18-year-old Iowa
farmhand finds himself leading a platoon into combat. And the life and
death of the company or the team or the project hangs in the balance.
That's leadership at all levels, which boot camp teaches a lot better
than business school.

9. Leaders win through logistics. Vision, sure. Strategy, yes. But

when you go to war, you need to have both toilet paper and bullets at
the right place at the right time. In other words, you must win through
superior logistics. Go back to the Gulf War. After that war ended, the
media stories focused on the strategy that was devised by Colin Powell
and executed by Norman Schwartzkopf. For my money, the guy who
won the Gulf War was Gus Pagonis, the genius who managed all of the
logistics.

It doesn't matter how brilliant your vision and strategy are if you can't
get the soldiers, the weapons, the vehicles, the gasoline, the chow --
the boots, for God's sake! -- to the right people, at the right place, at
the right time. (Right now, Amazon.com and a hundred of its dotkin are
learning -- or failing to learn -- the Gus Pagonis lesson.)

10. Leaders understand the ultimate power of relationships.

Here's a mind-blowing proposition: War -- or business on a wartime
footing -- is fundamentally a woman's game! Why? Because when
everything's on the line, what really matters are the relationships that
leaders have created with their people. I recall a Douglas MacArthur
biographer who claimed that the one piece of advice that MacArthur
most valued (which was passed on to him by one of his military
forbearers) was "Never give an order that can't be obeyed." But
women already know that. They tend to understand the primacy of
massive IIR (investment in relationships), which is one reason why the
premier untapped leadership talent in the world today rests with
women!

11. Leaders multitask. Which element is in the shortest supply today

-- and tomorrow and tomorrow? Time. The future belongs to the leader
who can juggle a dozen conundrums at once. And who is he? I mean
she? I just glanced at a lovely book called Selling Is a Woman's Game:
15 Powerful Reasons Why Women Can Outsell Men (Avon Books,
1994), by Nicki Joy and Susan Kane-Benson. Take this quick quiz, the
authors urge: Who manages more things at once? Who usually takes
care of the details? Who finds it easier to meet new people? Who asks
more questions in a conversation? Who is a better listener? Who
encourages harmony and agreement? Who works with a longer to-do

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list? Who's better at keeping in touch with others? Now that's what I
call multitasking! And again: Let's hear it for women leaders!

12. Leaders groove on ambiguity. Message 2001: Wall Street is

nuttier than a fruitcake! All of that stuff they teach us in Economics
101 about rational expectations? In the past year, we've seen those
"rational" boys and girls of Wall Street fall in and out of love with whole
sectors of the economy the way teenagers with overactive hormones
swoon and dive over movie stars. But when Wall Streeters do it, real
leaders in real companies feel real effects.

The next five years are going to be an economic roller-coaster ride.

That means that business leaders are going to be challenged
repeatedly not just to make fact-based decisions, but also to make
some sense out of all of the conflicting and hard-to-detect signals that
come through the fog and the noise. Leaders are the ones who can
handle gobs and gobs of ambiguity.

13. Leaders wire the joint. The good-old-boy's network provided a

direct way of operating: I'm a vice president, you're a vice president. I
want your order, I call you up, I take you out for a drink or a game of
golf, and, man to man, I get your order.

It doesn't work like that anymore -- not when power is diffuse, alliances
are ever changing, and decision-making channels are fluid, indirect,
and muddy. The game today: Soft-wire the whole joint. The way to
make the sale today -- or to have influence on any high-impact
decision -- is to build, nurture, and mobilize a vast network of key
influencers at every level and in every function of the operation.

14. Leadership is an improvisational art. The game -- hey, the

basic rule book -- keeps changing. Competition keeps changing. So
leaders need to change, to keep reinventing themselves. Leaders have
to be ready to adapt, to move, to forget yesterday, to forgive, and to
structure new roles and new relationships for themselves, their teams,
and their ever-shifting portfolio of partners.

15. Leaders trust their guts. "Intuition" is one of those good words
that has gotten a bad rap. For some reason, intuition has become a
"soft" notion. Garbage! Intuition is the new physics. It's an Einsteinian,
seven-sense, practical way to make tough decisions. Bottom line, circa
2001 to 2010: The crazier the times are, the more important it is for
leaders to develop and to trust their intuition.

16. Leaders trust trust. My longtime business partner Jim Kouzes

and his colleague Barry Posner nailed it with a one-word title to their

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recent book: Credibility (How Leaders Gain and Lose it, Why People
Demand It, Jossey Bass Publishers, 1993). In a world gone nuts, we cry
out for something or someone to rely on. To trust. The fearless leader
may (make that, had better) change his or her mind with the times.
But as a subordinate, I trust a leader who shows up, makes the tough
calls, takes the heat, sleeps well amidst the furor, and then
aggressively chomps into the next task in the morning with visible
vitality.

17. Leaders are natural empowerment freaks. There are two

ways to look at Jack Welch's legacy as a leader. The first is to say that
he has created more value for his shareholders than any other
comparable modern-day business leader. Which he has. He has also
created more leaders than any comparable modern-day business
leader.

When we think of Welch, we do not ordinarily think vision. (What is

GE's vision? I haven't a clue! "We bring good things to life" ain't it.) We
do think rigorous performance standards, empowerment ("WorkOut" in
GE-speak), leadership, and talent development. Jack Welch, it turns
out, is a great manager (see rule #1).

18. Leaders are good at forgetting. Peter Senge's brilliant insight

10 years ago was that companies need to be learning organizations.
My campaign 2001: Companies need to be forgetting organizations.
Enron Corp., which has repeatedly been tagged as the nation's most
innovative corporation, is exhibit A as a world-class forgetting
organization. It's not wedded to what it did yesterday. Enron chiefs
Kenneth Lay and Jeff Skilling have figured out how to operate like a
band of pirates. Got an idea? Don't dally. Go for it while it's an original!
Doesn't work? Try something else. If that doesn't work,
fuhgeddaboutit!

19. Leaders bring in different dudes. This is a corollary to

forgetting. Many leaders are preoccupied with creating high-
performance organizations. But to that, I say: Crazy times demand
high-standard-deviation organizations! This isn't just weirdness for the
sake of weirdness. This is weirdness for the sake of variety.

Winning leaders know that their organizations need to refresh the gene
pool. That happens when leaders forget old practices and open up their
minds to new ones. That also happens -- and more effectively -- when
leaders bring in new people and new partners with new ideas. As a
leader, do with your people what Cisco has done so effectively with
technology: Acquire a new line of thinking by acquiring a new group of
thinkers.

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20. Leaders make mistakes -- and make no bones about it.
Nobody -- repeat, nobody -- gets it right the first time. Most of us don't
get it right the second, third, or fourth time either. Winston Churchill
said it best: "Success is the ability to go from failure to failure without
losing your enthusiasm." Churchill blew one assignment after another
-- until he came up against the big one and saved the world.

As times get crazier, you're going to see more -- and dumber --

mistakes. When you make mistakes, you need to recognize them
quickly, deal with them quickly, move on quickly -- and make cooler
mistakes tomorrow.

21. Leaders love to work with other leaders. Nortel CEO,

president, and VC John Roth says, "Our strategies must be tied to
leading-edge customers on the attack. If we focus on the defensive
customers, we will also become defensive." Amen. (No: AMEN!)
Leaders are known by the company they keep. If you work with people
who are cool, pioneering leaders who have customers who are cool,
pioneering leaders who source from suppliers who are cool, pioneering
leaders -- then you'll stay on the leading edge for the next five years.
Laggards work with laggards. Leaders work with leaders. It really is
that simple.

22. Leaders can laugh. Another corollary to the art of leadership and
making mistakes: No one's infallible (except for the Pope). In order to
survive in these wild times, you're going to make a total fool of
yourself with incredible regularity. If you can't laugh about it, then you
are doomed. Take it from me. (And if you are a humorless bastard,
please do me a favor: Don't immediately march over to your VP of
human resources and order, "Ve vill haff humor! Bring me ze funny
people!" But do remember the madness of the times. Humor is the
best tool you've got to keep your team from going mad. No bull!)

23. Leaders set design specs. You can't be a leader over the next
five years and not be totally into design. Design specs are the double-
helix DNA that sets the tone of the culture and establishes the
operating ideas that embody the company. They are your
distinguishing characteristics, your brand's brand. If you don't already
know how, learn how to speak design. Apple CEO Steve Jobs calls
design "soul." I say: Design specs = soul operating system.

24. Leaders also know when to challenge design specs. Here

comes another bloody brain flip: In zany times, design specs (corporate
character) must be open to constant reevaluation. What worked during
the past five years may or may not work for the next five years.

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The classic example we should all watch: What will Jeffrey Immelt do
when he takes over "the house that Jack built" at GE? Want to know
what kind of leader Immelt will turn out to be? The clearest signal will
come from how he handles GE's design specs. In this Age of Madness,
nothing is holy. Even at GE.

25. Leaders have taste. It's a big part of the often-subtle topic of
design. There is such a thing as good taste. Maybe a better word is
"grace." I love this quote from designer Celeste Cooper: "My favorite
word is 'grace' -- whether it's amazing grace, saving grace, grace
under fire, Grace Kelly. How we live contributes to beauty -- whether
it's how we treat other people or the environment." Leaders who would
change our lives don't shy away from words like grace and beauty and
taste.

26. Leaders don't create followers, they create more leaders.

Too many old-fashioned leaders measure their influence by the
number of followers that they can claim. But the greatest leaders are
those who don't look for followers. Think of Martin Luther King Jr.,
Mohandas Gandhi, or Nelson Mandela. They were looking for more
leaders in order to empower others to find and create their own
destinies.

27. Leaders love rainbows -- for totally pragmatic reasons.

Another good word gone bad: "diversity." The case for diversity during
the past 20 years has been that it was the "right thing to do." Well, in
no-bull times, diversity isn't a good thing, it's an essential thing. It's a
survival thing. The case for diversity is the case against homogeneity:
When the world is undergoing sudden, unpredictable, dire change, you
need to have a diverse gene pool. You need to have multiple points of
view. In a heterogeneous time, homogeneity sucks!

28. Leaders don't fall prey to their own success. There are a lot
of people who have made it really, really big over the past five years.
Some of them actually think that they're responsible for their success,
if you can imagine that. But in crazy times, leaders don't believe in
their own press clippings. And they never, ever let their organizations
get complacent! Read The Paradox of Success: When Winning at Work
Means Losing at Life: A Book of Renewal for Leaders (G.P. Putnam's
Sons, 1993), by John O'Neil. He talks about the good qualities that
breed monsters. The first one on the list: Confidence breeds a sense of
infallibility. Again: Amen.

29. Leaders never get caught fighting the last war. It's the age-
old problem with bemedalled generals: They're always preparing to
fight the last war. The lesson, embedded in history, applies to

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business. What business are you in? The only answer that makes sense
today is, God alone knows! Did you win the war during the past five
years? Were you an early adopter of Internet ways? Good for you! The
only problem is that the Internet is still in diapers. The old giants are
awakening to its potential. What's your next totally new act?

30. But leaders have to deliver, so they worry about throwing

the baby out with the bathwater. Did I mention that these are
paradoxical times? Well, they are. So here's the flip side to the other
side: You must execute consistently, while fighting consistency. Years
ago, in Liberation Management: Necessary Organization for the
Nanosecond Nineties (A. A. Knopf, 1992), I called it the "ultimate
leadership paradox." To be "excellent" (to deliver profits, provide
quality, and satisfy customers), you must be consistent and build a
stellar infrastructure-delivery capability. But the single-mindedness
that allows you to hit earnings targets and quality goals is a disguised
set of blinders that makes you vulnerable to new, oddball threats
(consistency = focus = blinders). Love the bathwater! Throw the
bathwater out! Go figure!

31. Leaders honor the assassins in their own organizations.

There's only one reason why any human being ever makes it into the
history books: because he or she remorselessly overthrew the
conventional wisdom. Those are leaders. But truly great leaders, the
ones who aim to leave a legacy, go to the next level. They consistently
seek out and honor the people in their own organizations who want to
overthrow their conventional wisdom. Great leaders honor the people
who want to depose them, the assassins in their midst. Real leaders,
repeat after me: All hail Brutus!

32. Leaders love technology. I mean love! L-O-V-E. Here's the

equation for the next five years: Technology = architect of change. If
you don't love (and I don't mean like or tolerate) the technology, it will
change you and your company, but you will be the unwitting victim,
not the partner of change. Look, you don't have to be a technologist.
But you must embrace technology, care for it. It is your friend, your
lover. It will be unfaithful at times. It will lead you down dark and
dangerous alleys. No matter. It is remaking the world. And you must
joyously leap aboard (that's the way love is).

33. Leaders wear their passion on their sleeve. There's

absolutely no question in my mind: Leaders dream in Technicolor. They
see the world in brighter colors, sharper images, and higher resolution.
Leadership, in the end, is all about having energy, creating energy,
showing energy, and spreading energy. Leaders emote, they erupt,
they flame, and they have boundless (nutty) enthusiasm. And why

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shouldn't they? The cold logic of it is unassailable: If you do not love
what you're doing, if you do not go totally bonkers for your project,
your team, your customers, and your company, then why in the world
are you doing what you're doing? And why in the world would you
expect anybody to follow you?

34. Leaders know: Energy begets energy. Every successful

company, every successful team, and every successful project runs on
one thing: energy. It's the leader's job to be the energy source that
others feed from. But sometimes the leader has no energy. Sometimes
the situation is bleak, and the outcome is in doubt. And I say: Fake it!
For it is at that critical juncture that having energy is the most
essential. So if you gotta fake it, then fake it! Once you kick-start the
energy cycle, nature takes over. The energy will start to flow. Benjamin
Zander said it best: The job of the leader is to be a "dispenser of
enthusiasm."

35. Leaders are community organizers. Let's hear three raucous

cheers for Saul Alinksy! (Haven't heard of him? Quick! Go to
Amazon.com and buy Rules For Radicals: A Practical Primer for
Realistic Radicals [Random House, 1971]. Read it immediately!) It
doesn't matter if you're recruiting talent, making a sale, or forging a
partnership. Everything you do is the exact equivalent of grassroots
organizing.

Your title may say that you are the leader, but you're running for office
every day. Want to pull off that Internet-enabled business-process
redesign? You've got to get the frontline commitment, the votes!
You've got to get your customers to vote for you, your suppliers to vote
for you, your employees to vote for you. How do you get them to do
more than just show up? You enlist them and win their votes one damn
day at a time.

36. Leaders give respect. There's another great book with a one-
word title: Respect (An Explanation , Perseus Books, 1999), by Sara
Lawrence-Lightfoot. The heart of her message: "It was much later that I
realized Dad's secret. He gained respect by giving it. He talked and
listened to the fourth-grade kid in Spring Valley who shined shoes the
same way he talked and listened to a bishop or a college president. He
was seriously interested in who you were and what you had to say."
Care. Respect. Leaders care about connecting -- because it moves
mountains.

37. Leaders show up. Legendary, all-powerful sports agent Mark

McCormack offers a potent lesson on leadership in one of his books. He
insists that, even in the Internet Age (or is it especially in the Internet

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Age?), it's a worthwhile show of commitment and respect (see rule
#36) to travel 6,000 miles round-trip to consummate a five-minute
face-to-face meeting. Hatim Tyabji, who was then the soft-spoken,
charismatic CEO of Verifone, once traveled from South Africa to
Colorado -- on his way to Norway -- to give a one-hour presentation at
a conference of just 30 people. Why? Because three months prior to
that engagement, before all of the other trips had even been booked,
he had promised to be there. I guarantee that people paid
uncompromising attention to his one-hour talk, because he showed
uncompromising leadership by showing up.

38. Leadership is a performance. According to HP big cheese Carly

Fiorina, "Leadership is a performance. You have to be conscious about
your behavior, because everyone else is." Leaders spend time leading
-- which means that they spend time and exert ceaseless effort making
sure that they come across with the right message in the way that
they walk, talk, dress, and stand. Leadership is not only about action.
It's also about acting.

39. Leaders have great stories. A performance (see rule #38)

needs to have a script. Howard Gardner wrote about that in his book,
Leading Minds: An Anatomy of Leadership (BasicBooks, 1995).
Effective communication of a story is a key -- perhaps the key -- to
leadership.

Why? Because stories are the real thing. They are how we remember,
how we learn, and how we visualize what can be. If you want to involve
your colleagues in the future performance of your business, then don't
just present them with the numbers. Tell them a story. Numbers are
numbing. Stories are personal, passionate, and purposeful.

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 10 Ways to Beef Up Your Leadership Skills
Top

Have you ever heard someone say, “Actually, I have to admit that
I think I am really bad at managing other people. My staff all hate
me and I’m incapable of doing my job”.

The answer is no, of course. No one says this either because they
don’t believe it, or because they don’t want to appear
incompetent. Unfortunately research tells us that from the
employees’ perspective, there aren’t that many terrific managers
out there.

What should we take out of this dichotomy? Perhaps at the least,

we could all admit to ourselves that there is room for some
improvement in the way we lead others. After all, it’s not the sort
of skill that is easy to get 100% right all of the time. It might just
be that we don’t specifically know what improvements to make,
so here’s 10 ways to start

1. Get a reality check

Finding out what others think of our leadership style can be real
eye-opener, and is often the most powerful driver for change.
Using a 360 survey where you receive feedback from your staff,
peers and manager, gives you some concrete information on a
sometimes intangible subject. Use an existing tool (and there are
some highly regarded ones out there) or else simply let your staff
know that you are seeking feedback from them in order to
improve your style.

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A word of caution though, your staff may not feel safe in giving
feedback if they believe you are going to use it against them, or
become defensive about what they say. It’s up to you to create a
safe environment so they feel comfortable in being open and
honest with you.

2. Don’t use the power of your position to get things done

If people are questioning why certain things are done, or the logic
of decisions, never pull rank in response. A critical component of
effective leadership is getting the buy-in from your team and
colleagues. You don’t get buy-in by telling them that the decision
is the right one because you are the boss and you made it. Your
team may not always agree with what is being done, but they are
more likely to respect you if you take the time to explain your
rationale.

3. Don’t think of employees as things that need to be controlled

or managed

Instead, give them the latitude to take actions and make

decisions. Trust is a vital component of leadership. If you can’t
trust people to do their jobs well, then you either have the wrong
people in the jobs, or you have the right people but you haven’t
trained them sufficiently. Let them do what they are there to do,
without leaning over their shoulders all the time, or demanind to
know how they spend each minute of their time.

4. Listen, listen, listen

If there are unhappy or disgruntled people in your business, you

can guarantee that at some stage they’ve tried to tell you what
the problem is. It’s likely you weren’t listening (or didn’t want to
listen), or perhaps your initial reaction made the person think
twice about bringing the problem to you. Truly listening is one of
the greatest skills to develop, regardless of your role. Good
listeners are genuinely interested, convey empathy, and want to
find out what’s behind the conversation. Great leaders are great
listeners –without exception.

5. Stop providing solutions

Managers often achieve their positions after being technical

specialists, and so will have an opinion or view on how to "fix"

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situations or problems. They believe that it's faster to tell
someone what to do, or do it themselves, than give their
employees an opportunity to figure it out. By always providing
the answers, managers take away opportunity for their
employees to learn and come up with alternative (and potentially
better) ways of doing things.

6. Always be constructive – always

Language and communication skills set great leaders apart from

mediocre ones. Don't patronise or be critical of others - take
complete responsibility for how you are heard. If you catch
yourself about to make negative remarks, take a breath and
rephrase your words to get your message across without the
emotional attachment. Great leaders always find a way to say
things calmly and constructively.

7. Judge your success by the success of your team

The true success of a leader can be measured by the success of

the people that work for them. As a manager of others, your
prime responsibility is to ensure the success and development of
your team. If they are successful, you will automatically be
successful. Focus on building their skills and removing obstacles
in their way. If you can achieve this, you will see the results in the
productivity, motivation and satisfaction of your employees. This
in turn filters through to bottom-line results.

8. Don’t do things just because they will “look good”.

Nothing is more transparent than managers who make decisions

and behave in ways simply to look good to their superiors. If you
want to improve as a leader, one of the qualities you need is
integrity. The integrity to make decisions because they are right,
and the integrity to stand up when you truly believe something is
not in the best interests of the business. Whether or not it is in
your personal best interests is much less of a consideration.

9. Include humour in your diet

Nobody likes to work in an environment that is devoid of any fun.

People are more productive when they are enjoying themselves.
Creating a workplace where fun is permitted and encouraged can
make a significant difference, and it’s even more effective when

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 the boss participates. It increases team spirit, and encourages
people to see you as a person, not simply as the boss.

10. Let people get to know the real you

Being open about yourself helps to break down the barriers that
hierarchy puts in place. When your employees know the person
behind the façade, that’s when you start to build the foundations
of good leadership - trust and respect.

Disrupter - Akira Ishikawa

Top

The semiconductor has been the driving force behind the digital revolution.
Now Akira Ishikawa is looking to force the revolution into overdrive by
creating semiconductors in the form of spheres instead of chips -- a
breakthrough with truly electrifying.

They look like embryonic pearls or like the ball bearings for some fantastic
miniature machine: two-dozen exquisitely smooth, silver-gray beads alive
with reflected light in the slender glass vial that Akira Ishikawa rolls between
his thumb and forefinger. in fact, the beads are the product of Ishikawa's
disruptive vision -- spherical semiconductors that could cut the cost of
computer-chip manufacturing by a factor of ten.

"Many people thought this was crazy," says the 64-year-old silicon wizard.
"That's all right. The history of semiconductors for the past 40 years has been
this way -- we have faced so many thick walls, and when we break through,
there's another barrier." Craziness, after all, is just another name for crashing
through more barriers than anyone else.

So here is Ishikawa's barrier: Nearly everything we know about the delicate,

exacting process of building microscopic transistors on silicon is geared to
making flat computer chips. Until Ishikawa, no one had tried to etch a
semiconductor's tiny circuitry onto a curved surface, much less onto a

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sphere. Ishikawa and his team first had to invent some way to make a single
crystal of silicon in the shape of a sphere, which they accomplished by
dropping molten silicon through a tower that cooled the droplets precisely as
they fell. They then wrote software to design circuits on spherical surfaces
without distorting the physics of electrons that whiz through wires thinner
than a human hair.

Finally, they figured out how to float the spheres through gas-filled pipes
where slivers of material a few atoms thick were stripped away without ever
allowing the spheres to touch the pipe walls -- a critical breakthrough to avoid
contaminating the devices with tiny bits of dust and debris. Herein lies the
enormous potential economic payoff: Because the spheres don't require
immaculate "clean rooms," Ishikawa says, a factory to make them can be
built for about $100 million -- compared to $1.5 billion for conventional chips.

The audacity of Ishikawa's vision has attracted skeptics -- but important allies
too. Ishikawa formed Ball Semiconductor Inc. in October 1996 and has raised
$80 million from such companies as Hitachi and Maxell. Bright young
engineers from such countries as China, Japan, and the United States have
found their way to Allen, Texas, outside of Dallas, where the company is
based -- a total of 35 employees who sought out Ishikawa. "That is their
choice, their way of taking a risk," he says. "I did not ask them to come, but
they came."

Ishikawa's reputation as an original thinker with a good track record seems to

be the one reason that Ball Semiconductor is not dismissed out of hand as a
crackpot scheme. "I look at it and think, 'This is nuts,' " says semiconductor-
industry analyst Steve Cullen of Cahners In-Stat Group, who does question
the feasibility of Ball's approach. "But Ishikawa is not the kind of guy who
would be involved in something that's nuts."

It's hard to argue with his credentials. As president of Texas Instruments

Japan, Ishikawa led the company to win Japan's coveted Deming prize for
manufacturing excellence. He moved to Dallas in the mid-1980s and built a
thriving career in TI's freewheeling culture. But the idea for a spherical
semiconductor kept gnawing at him. At first the idea was vague and formless,
a brilliant abstraction about the surface area of a sphere, which is three times
larger than the surface area of a flat chip. In an industry where the amount of
real estate available on a bit of silicon is everything, Ishikawa's insight had
huge implications -- all of which seemed impossible.

He could have played it safe and stayed comfortably at Texas Instruments

until his job as executive vice president in charge of TI's largest product line
launched him into a nice, easy retirement. But that's not Ishikawa's way --
either in business or outside the office. (A case in point: While most golfers
are content to maneuver for admission to a fancy country club, Ishikawa
purchased 250 acres of rolling Texas fields and spent most every weekend
for six years designing and building an 18-hole golf course, driving a
bulldozer, a backhoe, and a dump truck himself.)

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The first wave of applications designed to exploit Ishikawa's bold new
technology will debut sometime next year. Ball and product developer Omron
Corp. will get started marketing a motion-sensor switch that is mounted onto
an automobile in order to prevent theft. Ishikawa also has high hopes for
medical applications, such as temperature sensors that could be slipped into
the body through catheters, or pills you could swallow that would report
temperature as they pass through your body. Ball's manufacturing facility in
Allen is already nearing production volumes.

All of these applications underscore the critical design principle for Ball: Don't
take on the incumbent -- in this case, the 40 years of accumulated wisdom
and refinements in flat computer chips -- because the only way to compete in
the face of such established practice is to explode it, to make something
wildly novel. "This is a moving circuit," Ishikawa explains. "You can't compare
it with existing circuits, which are more powerful and higher in value." It is,
after all, crazy

Finbarr O'Neill Is Not a Car Guy

Top

How the CEO of Hyundai Motor America, a corporate lawyer by training,

engineered the most unlikely turnaround in the auto business -- and kicked
Hyundai into gear.

It's hard to feel sorry for car dealers. But go back a few years, and put
yourself in Don Reilly's shoes. It's 1998, and Reilly, one of the 50 original
dealers who had signed up to sell cars in the United States for Hyundai, was
experiencing nothing short of a nightmare. The models on his lot had become
the butt of jokes on late-night television. Overall U.S. sales for the brand were
running at a paltry 90,000 cars a year. Hyundai Motor America had been

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without a CEO for months. And now Reilly was in a hotel conference room in
Monterey, California -- listening to a lawyer .

The lawyer was Finbarr O'Neill, Hyundai's general counsel since the
company's U.S. launch in 1985. O'Neill was serving as acting chief operating
officer while the parent company searched for someone -- anyone -- to lead
the struggling brand.

"Fin got up and asked what direction we thought the company should be
going in," says Reilly. "We started throwing out suggestions, yelling out
advice. Fin called time-out, left the room, came back with an easel with lots
of paper on it, and started writing a bunch of things down."

By the meeting's end, O'Neill had recorded 100 suggestions -- and was facing
a decidedly less angry mob of dealers. "Fin said, 'I can't work on all of these
at once, so let's pick the top 10, and that's where I'll start,' " Reilly
remembers. "That was Hyundai's defining moment. It was the day that
somebody took charge. It's when we got leadership."

Lawyers don't usually end up running automobile companies. But a few

months after that meeting in Monterey, Hyundai handed over the reins of its
American unit to O'Neill. It was an utterly unexpected move. He wasn't
steeped in design. He wasn't an engineer. He wasn't a car guy . "Being the
'acting' anything is an awful job," O'Neill says, with just a hint of an Irish
brogue that still lingers after more than 40 years in the United States. "But I
knew that I would have to keep working with these people after we found
someone to take over." So instead of trying to make waves, he says, "I just
tried to hold things together."

As it turns out, that was just what the company needed. Using his most
lawyerly attributes -- disciplined thinking, attention to detail, patience for
steady progress -- O'Neill began attacking the brand's problems one by one.
Four years later, the most unlikely CEO in the U.S. auto business is presiding
over the industry's most unlikely transformation.

Hyundai Motor America has achieved record sales for each of the past 18
months, and sales in the United States have quadrupled during the past four
years, giving the company an American market share that is equal to that of
Volkswagen. (This year, Hyundai expects that it will sell some 370,000 cars.
O'Neill's goal is to sell 500,000 units a year by 2005.)

Hyundai is so hot that it broke ground this year on a billion-dollar plant in

Alabama -- its first U.S. factory. The whole thing makes the lawyer in O'Neill a
little uncomfortable. "We have been on the precipice of brand oblivion," he
says. "Now, with the turnaround, there is opportunity to bask in our own self-
satisfaction. Hubris is our biggest challenge."

Have No Fear, Your Warranty Is Here

O'Neill put Hyundai on a growth track by making a bold strategic turn. He

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understood that his first order of business as permanent CEO was to address
the company's biggest problem: worried customers. Put simply, he had to
take the fear out of buying a Hyundai.

O'Neill knew that an eye-catching warranty would help relieve consumer

anxiety about buying cars that Jay Leno liked to mention in the same breath
as the Yugo. He also knew that such a warranty would involve risk. If Hyundai
had to spend tens of millions of dollars fixing troubled vehicles, it would go
out of business long before he could turn the brand around. The ultimate
decision: to unveil what O'Neill and his executive team called "America's Best
Warranty": 6 years of bumper-to-bumper coverage and 10 years of coverage
on the car's engine and transmission.

Why was O'Neill prepared to make such a bold bet? Because he knew
something that the comedy writers didn't: Hyundai had already started
paying serious attention to quality. In the late 1990s, its cars were getting
better and better, even as the brand's reputation sank lower and lower. What
seemed like a brash gamble was in fact a prudent move -- classic O'Neill. "He
won't say something or do something that he can't deliver on," says Robert
Cosmai, Hyundai's vice president of national sales.

His nearly 600 dealers know that too -- largely because O'Neill spends so
much time in their showrooms. Most big-time auto executives show up at
dealer meetings once or twice a year. They might fly out to schmooze their
top performers. But O'Neill will visit 100 dealers this year, an average of two
per week. "I've got to know if there's anything Hyundai does that's standing
in the way of them selling cars," he says matter-of-factly.

From Function to Fashion

For O'Neill, quality is job one -- but it's not his only job. Hyundai's next big
challenge: to go from functional to fashionable. "The brand remains in the
bottom 10 of cars that people will consider," reports George Peterson,
president of AutoPacific Inc., a consulting firm. In fact, many customers still
choose between a new Hyundai and a used car from a higher-profile brand.
That isn't a foundation for long-term success. "We want people to say at
cocktail parties, 'It's okay to have a Hyundai in the driveway,' " quips O'Neill.

Here too the CEO is prepared to shift into high gear. Hyundai has been
enjoying fat margins in the United States. But rather than dropping prices to
gain share, it has pumped cash back into the cars in the form of trendier
design, leather seats, and side air bags. Hyundai's new compact SUV, the
Santa Fe, has nabbed customer-satisfaction and safety awards and has
become something of a cult favorite. Hyundai's sleek, sporty, six-speed
Tiburon is also getting positive reviews.

O'Neill says that he has paid close attention to what retailer Target achieved
by combining low prices with cool design. That's why he persuaded Hyundai
to build a $25 million design center in southern California. O'Neill hopes that
the center will allow Hyundai to appeal to customers' emotions as well as

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their wallets. "I'll never pretend to be a car guy," O'Neill says. "But I don't
want to sell just a heater and keys."

Indeed, as Hyundai prepares for a new phase of growth and expansion,

O'Neill is acting more like the business visionary that he declined to be back
in 1998. For example, he's launching a high-profile marketing campaign for
his newly energized brand: inspirational, emotional ads that barely mention
the bumper-to-bumper warranty. "A car isn't just nuts and bolts," says O'Neill.
"At some point, it has to be a reflection of your desires."

Gee, he almost sounds like a car guy.

Sidebar: What's Fast

More Than a Heater and Keys

A six-speed sports transmission, a V-6 engine with enough power to hit 180
horses, and a ripped design that pays homage to Ferrari. The 2003 Tiburon
(above) is exactly what you wouldn't expect from Hyundai.
But the Tiburon is just the kind of ride that Finbarr O'Neill's team of marketers
hopes will set the tone for Hyundai's next step forward: designing cars that
critics and consumers lust after. "Having a great warranty is beside the point
with a car like the Tiburon. Basically, it just looks great," says Paul Sellers,
Hyundai Motor America's director of marketing communications.
So far, consumers agree. The Tiburon's sales hit close to 2,000 units in July
alone. More important: Young males who spend thousands of dollars to trick
out Acura RSXs and Honda Civics have turned their attention to the Tiburon,
which already comes with 17-inch wheels on the high-end version -- the latest
must have for the hottest cars.

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