Not all companies and not all leaders want to be enduring and great. In our modern economy, many companies are what Jim Collins calls “built to flip” rather than “built to last." Many in today’s entrepreneurial landscape don’t worry about working hard to build something enduring; for them, it is sufficient just to have an idea good enough to make money by selling the company for a profit. If amassing a personal fortune is your primary motivation in building a company, then read no further - this post is not for you.
However, if your aim as a business leader is to build a company that will continue to make a lasting contribution to our society or to your industry long after you’ve left, then read on.
In researching Good to Great, Collins discovered that every single one of the companies in his study that transitioned from good to great had a leader at the helm with Level 5 Leadership qualities. Collins defines two main characteristics of Level 5 leaders: “extreme personal humility and intense professional will” (p. 21). While Level 5 leaders are clearly ambitious, their ambition is aimed at making the company great, not their own personal success. To this end, they are very concerned with growing the leaders in their organization and setting up their successors to continue their legacy of Level 5 leadership. Collins believes that Level 5 leadership can be cultivated by someone who has the innate capability and is not so egotistical that they could never take their focus from their personal ambition.
Here is how Rhythm can help you cultivate Level 5 leadership:
• Connect Strategy to Execution: Level 5 leaders exhibit discipline and have an incredible ability to maintain focus on their quest; in other words, they keep the strategic direction of the company at the forefront. They understand the importance of making sure that everyone in the company understands the strategic direction and what they can do to help.
Rhythm helps you share your strategy with your team on a regular basis and helps your team understand what they need to do to help. Implementing a Plan Rhythm in which you determine a focus for your year that will move you closer to the successful completion of your BHAG and other long-term strategic goals, and then using that annual focus as the foundation for your quarterly plans, and then using the quarterly focus as the basis for your 13-week race will give you the discipline and connection you need.
• Use Dashboards: Many choose to look to experts in times of uncertainty; however, Level 5 leaders do not rely on others but look directly at empirical evidence. Collins says that personally examining the evidence rather than relying on reports and opinions from others allows leaders to be more creative and reduce their risk. Using a dashboard to track key metrics, both leading and results indicators, will give you the real-time data you need to make the right adjustments to hit your quarterly plan.
• Schedule a Weekly “Meeting with Myself”: Another of the factors Collins sites that can help someone develop Level 5 leadership is self-reflection. With Rhythm, you set aside time each week to reflect on your victories from the past week, your priorities for the week ahead, and the single point of focus that is most important for the upcoming week. This time for self-reflection will help increase your personal performance as well as your leadership capabilities.
• Establish a Think Rhythm: Another important trait Level 5 leaders possess is “productive paranoia.” Level 5 leaders maintain hyper-vigilance even in good times recognizing that at some point unforeseeable events will occur that they better prepare for. Setting aside time for a Think Rhythm in which you work on the business rather than in the business is key to maintaining an awareness of the competitive, economic, and political landscape that could impact the future of your business. Spending time each week, each month, each quarter and each year intentionally thinking about your strategy will help you avoid the pitfalls of resting on your laurels and settling for building a good company rather than an enduring great one.
In the end, building a great, enduring company is not about being a visionary or charismatic leader but about cultivating others as leaders. Think about your legacy, and remember to encourage others’ ideas and contributions and to lead in a way that grows successors from within the company. To learn more about how you can grow not only your own leadership capabilities but also build the future leaders of your enduring company, watch this archived webinar by Patrick Thean and Barry Pruitt.