The experiences of leaders in different countries clearly shape them.  Two researchers looking at leaders in China, India and Singapore noted difference in challenging assignments, developmental relationships, dealing with hardships, education and personal experience.  All of these influences shape individuals into the leaders they are, and gaining an appreciation for each individual’s personal biography is insightful and essential for understanding their own expression of leadership with its gaps and its strong areas.

One way of understanding leadership differences is through behavior styles.  What we need is a fully descriptive, universal language for behavioral description, one that resists the bias of assigning “good” and “bad” labels to different ways that effective leaders get things done.  Two leaders, both equally effective, can take very different paths to arrive at similar results using different behavioral strategies.  Being able to describe those differences objectively, like a scientist, and avoiding personal biases allows us to expand our appreciation of different leaders and ultimately to develop more top talent for tomorrow’s leadership positions.

Research that I did with 1200 leaders in Asia led me to see clear behavior style preferences in different cultures.  In multinational companies (MNC’s), understanding these differences allows for context-specific leadership development as well as company-wide efforts to cultivate the next generation of top talent.

Some summary observations*

Leaders in India had a strong tendency to express dominance (direct, problem->solution orientation) in their leadership styles, especially in the business world.  In Korea, compliance-steadiness (detail-orientation, careful and analytical decision-making) were strong markers shared by many in the top levels of leadership.  In China, the preferred style for leaders were dominance, compliance (detail-oriented, analytical rules-based decision-making) and dominance-compliance (directness and high standards).  In these countries and across Asia there was a noticeable preference for a factual, objective approach to persuasion and motivation methods rather than extroverted, personal and humanistic approaches.

This research showed that cultural difference do indeed show up in self-expressed behavioral preferences by leaders.  However, within each culture there is still room for a diversity of styles and approaches even where one or a cluster of styles is preferred more often than others.  This has some implications for talent management and leadership development.

First, organizations have their own culture just as nations do.  Different MNC’s doing business in the same country or markets may have very different profiles or styles of leadership.  Sometimes, the preferred style imposes its own blinders on the rest of the culture.  When it comes to behavior style, diversity is a potential strength, but it must be acknowledged and managed or else decisions (and the culture) tend to reflect arbitrariness and chaotic tendencies.

Second, good talent management practices will not focus simply on “competency models” or modeling based on traits; it will be closely connected to business results, cultural awareness and experience-based learning and development.  The good news for talent management is that there are tools and proven precedents for defining what success looks like and what kind of leadership is desired for future growth; it is not simply about luck, intuition or other subjective biases.

Third, in terms of leadership development Asian leaders have historically valued a small number of close relationships and relied on personal experiences to guide them through difficult leadership trials and challenges.  A leadership style that projects personal warmth and charisma or inspiration more broadly (as North Americans are perceived to do) has not been part of their repertoire.  This is not a shortcoming or gap; it reflects preferences, comfort level and conditioning which is part of the culture.  More leadership development in Asia needs to be individualized and respect the high-context cultural reality, rather than importing Western models of executive education.

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*The leadership and behavior styles mentioned here are based on the Marston behavioral tendencies model.  For more on this and the research results mentioned you may send me an email requesting more information:  ron(at)leadskill(dot)com or use the comments box below.

That presents its own problems.  Because the market is growing and the activity level is high, there is plenty of competition among companies for scarce resources.  Attracting and retaining talent in the form of qualified employees and managers is a top concern.  Maintaining morale and high productivity is clearly another.  The competition for raw materials or inputs for the business challenges the ability to maintain healthy margins, while all of the uncertainty makes forecasting results very difficult, if not impossible.  Inaccurate forecasting causes inefficiencies and hits productivity and morale, which shows the interconnected nature of today’s challenges.

Organizations that are able to attract the best talent and that have the culture to retain and develop this talent will clearly be the winners over time.  Those that manage in a reactive mode or who focus on the short-term and neglect their people/talent practices will suffer from self-inflicted injuries.  Talent is fairly mobile in China.  Top talent is very mobile, and capable leaders will go where there are both opportunities and their own contributions are valued.

Good talent management and leadership development practices are in their early stages in China, so capitalizing on this area will create a competitive advantage for firms that get it right.  Leaders that can shift from reactive to proactive management will integrate this into their strategic vision and execute relentlessly until they get it right.  The competition for talent in China is already hot, and the temperature is only going to climb in the coming days.

Xenophon grew up in Athens and was a direct student of Socrates in the fifth century B.C.  As a young man he joined a military expedition from Greece to Persia and went on to become a battle-tested general before retiring to southern Greece and writing on philosophy, history, economics, politics, and other subjects.  Woven throughout his writing is Xenophon’s observations and lessons about leadership.  The systematic book that Drucker mentioned was The Education of Cyrus (or Cyropedia), based roughly on the life of Cyrus the Great who lived over a hundred years before Xenophon.

Xenophon writes about his own initiation into leadership in  The March Upcountry (or Anabasis), which has been classified as military history but is actually an epic of leadership written by a participant who saw good and bad leadership at close quarters.  I first read this book in 1988, and didn’t know what a gem I had.   I’ve gone back since then and learned some important lessons.  One of those is how the military holds some great lessons for leadership.

The military as a learning laboratory for leadership?  The notion is not so far-fetched.  In my interviews with officers who served in the U.S. Army and Marine Corps (2009) and who later transitioned into civilian leadership roles in business I noticed some common themes that went far beyond admirable traits or desirable leadership characteristics.

The military does an excellent job of training and reinforcing leadership in its combat officers.  This is done through recurring education, through reinforcing good disciplines of decision-making, by job rotation and merit-based job promotions, and through reinforcing a culture of honor, sacrifice and service.   William Cohen writes about these in A Class with Drucker (2008).  Together these make a powerful combination for solid leadership development.  The military does not often get the very best raw talent to join their ranks, but their system of rigorous development allows them to produce a disproportional share of the strongest leaders in any sector of society (whether business, education, politics, healthcare, social service or entertainment).

How do they do it?  If you have had experience as a military officer this will all be familiar.  For the rest of us I’ll share a few points.

First, the military takes training seriously.  They operate on two basic assumptions  The harder you train, the better you’ll perform; and everyone carries some degree of leadership responsibility.  Anyone involved in sports understands and agrees with the first assumption.  If you want to perform well and consistently win, you have to train hard.  Businesses today hardly train their people for leadership, either formally or informally.  It creates a huge gap when real leadership is needed.  The second assumption in the military, that everyone has some degree of leadership responsibility, arises from the realities of battlefield situations.  Combat is very fluid; leaders can be killed, injured or taken out of commission in other ways.  Every soldier has to be ready to assume greater responsibility and leadership without notice when the situation changes.  In most businesses today the owner or CEO may wish that every employee was more responsible, or thought like an owner, but the ethos and expectation of leadership is missing from most organizations except at the top.

Second, jobs or roles are assigned based on merit and rigorous review.  The military is a meritocracy, which means the decision to “hire” and promote is primarily based on merit and demonstrated competence, not on personality contests or other forms of fundamentally unfair competition.  There are ongoing performance reviews and counseling, promotion boards, and practices designed to ensure that there is a rich pool of leadership talent to draw from at the higher levels.  If only more companies were so lucky…

Third, the military has a rich and meaningful culture of leadership that sets high standards for honor, character and service.  Individuals don’t always live up to those standards, but through discipline and tradition the standards are not negotiated down.  Culture is articulated and maintained by the leaders of any organization;  morale is an indicator of the health and condition of the culture at any given time.  On both counts the military pays a lot of attention to how well its leaders embody the culture and maintain high morale through example.  Good businesses that are run in a disciplined way do the same.

The best-kept leadership secrets really are out in the open.  The military is certainly not perfect, and even the practices I’ve talked about are not implemented with uniform equality.  However, if you compare them in design and in execution with any other leadership program, you’ll find it difficult to come up with a close second-place contender.

What are your thoughts and experiences with these leadership practices?

CEO pay at 18 financial companies was down 30%.  No surprises there–they are under lots of pressure from the public and the media.  At the same time, 38 financial service firms on Wall Street paid a collective $140 billion in compensation and benefits, a record number, and up from $123 billion in 2008 and the previous high-water mark of $137 billion in 2007.  What does this all tell us?

Two things:  Wall Street’s approach to compensating top talent has not changed, even as headlines seem to imply that executive compensation is down.  CEO pay may be down, but the all-out effort to retain top talent among traders, money managers and top analysts is still calculated in the simple formula of  more dollars=stay for another day.  The other point is a reflection on leadership.  The top leader (CEO) is a lightning rod for criticism, and they have to take the hit when emotions are stirred.  I expect that these CEO’s are still not going to be hurt too much.  Make-up compensation and deferred bonuses can be paid out at other times and in other ways once the public glare focuses elsewhere.

A real sign of leadership would be finding innovative ways to reward performance, manage risk and produce sustainable results.  Without leadership, you’re simply managing mercenaries and the only obvious solution is to throw ever-increasing amounts of money to the troops.

Every day we size up talent by observation, through conversation and based on our own personal experience.  Imagine that you are hiring someone for a job.  When a person is sloppy, cocky or self-centered, it tends to diminish our assessment of them.  When they are confident, open to learning and focused on others, we tend to give them higher marks.  We have just measured talent.  It may not be the best way to do it or the most accurate or fair, but it is a rough and ready tactic that most everyone adopts.

Can we get beyond the gut instinct?  It is the subjective judgments that get in the way of good talent assessment.  Humans have a lot of predictable biases.   We have terms for them like “the halo effect”,”ingroup bias”, “projection” bias, “herd instinct”, the illusion of transparency, the illusion of superiority, the “self-fulfilling prophecy”–there are over 20 social biases.  Even when we’re aware of them, which isn’t often, biases still affect our sound judgment.

The fact is that talent can be measured objectively and we can override the prevailing bias that skews our judgment.  However, it takes effort, and it helps if you have some good tools.  One such tool is a well-designed process to follow so that you don’t develop tunnel vision and become trapped in one or several of the predictable biases.  Another tool that can work well in some contexts is the wisdom of crowds, or crowd-sourcing.  A well-known example of this is the American Idol series where millions of people get to vote on the top talent.  The crowd can often be better than the “expert” panel.  When you can get true experts, some variation of the Delphi method can be useful.  There needs to be some rigor in the process, and Delphi experts tend to be better at prediction and problem-solving than talent-related issues.  Another effective tool  is well-designed objective assessments or tests that demonstrates ability, tendencies or judgment patterns.   When these are correlated to the task that needs to be done, they can have a real objective value at separating the talented from those less-so.

One of the best ways to measure talent is to look at performance over time and in a wide set of circumstances.  How well does a person perform?  How consistently?  What is the trendline–is it improving or deteriorating?  Performance is one of the best indicators of talent, and ultimately talent that is applied is what we are interested in anyway, rather than mere potential or raw talent that has not been or will not be applied and put to the task.

How can this be?  Productivity is supposed to be a good thing.  Productivity is the measure of how much a business produces divided by the number of workers, so if productivity goes up a business should make more money.  How can this be a talent killer?

Think about the definition again.  One way to “juice” productivity is to lay off workers.  In the short term, productivity goes up (and investors usually cheer as the stock price rises) until the burden of producing weighs too heavily on a workforce that is too lean.  Another way to increase productivity is to sell more, take on big orders, without fully staffing for the increased demand.  This will also lift productivity–for a a short while.  You can cheapen the brand, cut development or innovation, or manage by dictate:  management declares a super-stretch result that leaves everyone scrambling to “hit the number.”

All of these examples (which are far too common) involve a focus on the short-term, some degree of manipulation, and a failure to deal with longer-term consequences.  And those are what is killing good talent practices in business.  How?  By treating people like human resources, not people who can contribute to the company if given the opportunity.  By failing to invest in sustainable gains in revenue, growth and productivity.  By stressing out workers, you give them an incentive to go to your competition.

The path to illusory productivity involves short-term thinking, shifting the burden to workers, or some kind of management shell game that hides the real dynamics–for a while.  These kinds of productivity gains are what is killing good talent in American business.

Not all productivity has to come with these tradeoffs.  There are other ways to grow productivity that promote good talent management:  through more employee engagement; by investing in training and skill development; through analyzing business processes and cutting out the waste and rework; by building a valued brand and unique culture that is hard or impossible to duplicate elsewhere.  The productivity that results from these kinds of practices is sustainable for the business and it tends to engender more loyalty and trust in the workforce.

Which kind of productivity is your company focused on ?  Let me know by leaving a comment.

I owe inspiration for the headline and article to Henry Mintzberg, management professor and contrarian thinker at McGill University in Montreal (see his article in Harvard Business Review July 2007).

Why do we dislike them so much?  Common reasons:

• The process feels awkward.
• It doesn’t yield meaningful information.
• Bosses don’t do it well.
• Employees experience great anxiety.
• It seems so subjective or unfair

How can we do a better job?

1. Focus on performance.  Seems obvious, right?  The major problem is that most jobs do not have clear performance expectations that are shared and understood by both management and employees.  We get vague generalities, “areas of responsibility”, or a listing of common tasks, but clear and measurable performance standards are often missing.  You cannot have a meaningful performance review unless there are clear performance standards for a job.  Managers who ignore this are responsible for a majority of the recurring headaches they face in managing people.
2. Create the right context.  This is not the time for counseling, grievances, or unfocused conversations.  The goal is to help the employee be successful and the company/organization to meet or exceed it’s objectives.  Appraisals are time for an honest assessment, for feedback so that people know for sure if they are getting the job done or not.
3. Use a simple format.  I like the one first suggested by Peter Drucker.  Start with a statement of the major contributions expected from the present position, then ask four questions:
   1. What has this person done well?
   2. What, therefore, are they likely to be able to do well?
   3. What does this person have to learn or to acquire to be able to the get the full benefit from their strength?
   4. If I had a son or daughter, would I be willing to have him or her work under this person?  (i)  If yes, why?  (ii) If no, why?

The truth is, most employees are frustrated by the lack of real information that comes out in a performance appraisal and the apparent subjectivity of the judgments made about them.  What they want to know is, “Am I doing a good job?  Where can I improve?”  Good managers that help them answer these questions in a fair and objective way garner a lot of respect.

Yesterday  John Mack, Chairman and CEO of Morgan Stanley told his shareholders that he has to pay employees well to keep top talent and grow the business, but he doesn’t see the ability to sustain that into the future.  The average bonus paid per employee in 2008 at Morgan Stanley was $143,000.  They have seen this as the cost of attracting top talent to the firm. 

The problem is that this is expensive and difficult to sustain, especially for huge companies the size of Morgan Stanley.  Mack referred to a phone call he had with a hedge fund manager who told him:  “I can hire anyone from you (Morgan Stanley) or Goldman Sachs…”, to which Mr. Mack had no real answer.  The chairman and CEO of a Fortune 100 company admits that he has no real clue about how to keep top talent when faced with an extension of his own strategy, which amounts to a bidding war. 

Here’s an idea:  pay people fairly for their talent, but don’t try to flatter their egos with excessive money.  That attracts the wrong kind of people.  Instead, focus on developing a team of people who embrace deeply what the company is about and are trained or equipped to deliver on that core mission.  Developing top talent is not really a money game unless you have deep pockets and are looking for mercenaries; it’s actually a discipline that top managers pursue and hone over time to produce sustainable results.

I found it interesting that Goldman Sachs wanted to quickly return some of the government money it took last fall, partly so they would not be limited by government meddling in their compensation/bonus policies.  CEO Lloyd Blankfein knows that Goldman’s business model is based on generous financial rewards to top performers.  Other investment banks have said compensation caps will cause a flight of top talent.  Maybe multi-million dollar compensation only buys temporary rather than enduring loyalty.   They don’t call it a “money culture” without reason, and when the money isn’t flowing, the talent may not stick around.

Contrast that with the approach taken by Zappos.  The online retailer has quietly grown to $1billion in sales and in the process has built a culture that looks a lot like the exuberant workplaces of the dotcom era.  Zappos CEO Tony Hsieh has focused on building a culture devoted to customer service and employee engagement.  Zappos gives a lot of attention to recruitment and training-hallmarks of firms that are committed to truly developing top talent.  Employees have some degree of latitude in making sure customers are satisfied, and Zappos has a very high number of repeat customers and they are still growing, even in a serious economic downturn. 

Developing a culture and keeping top talent doesn’t happen automatically and it’s not something that is simply fixed with money.  Oh, if only it were that easy.  But it is doable and companies like Zappos are showing it may be one of the few paths to competitive and strategic distinction.

Mostly because of his ability to deal with people. 

What did Charles Schwab have to say about how he effectively dealt with people?

“I consider my ability to arouse enthusiasm among my people the greatest asset I possess, and the way to develop the best that is in a person is by appreciation and encouragement.”

“There is nothing else that so kills the ambitions of a person as criticisms from superiors.  I believe in giving a person incentive to work.  If I like anything, I am hearty in my approval and lavish in my praise.”

Related by Dale Carnegie from a personal conversation he had with Charles Schwab (How to Win Friends and Influence People)