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Level 5 Leadership
The Triumph of Humility and FierceResolve
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The Future of Work
Characteristic 20th Century Org 21st Century Org
Focus Internal External
Style Structured Flexible
Source of Strength Stability Change
Structure Self-Sufficiency Interdependencies
Resources Physical assets Information
Operations Vertical integration Virtual integration
Products Mass production Mass customisation
Reach Domestic Global
Financials Quarterly Real-timeInventories Months Hours
Workers Employees Employees and freeagents
Leadership Dogmatic Inspirational
Motivation To compete To build
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James M. Kouzes & Barry Z. Posner.
1993. Credibility: How leaders gain
and lose it, why people demand it.
San Francisco: Jossey-Bass.
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Ambitious
Establishes Strong Relationships
Consistently High Performance
Team Building and Leadership Skills
Intelligence
Willingness to Take Risks
Able toAdapt Problem-Solver
*Centre for Creative Leadership
What Defines Success in an Executive?*What Defines Success in an Executive?*
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Problems with Interpersonal Relationships
Failure to meet Business Objectives
Inability to Build and Lead a Team
What DefinesFailure in an Executive?*What DefinesFailure in an Executive?*
*Centre for Creative Leadership
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Comparison Companies
Copyright Jim Collins, All Rights Reserved
Comparison Companies Gallup50
Copyright Jim Collins, All Rights Reserved
What does the Research Say?What does the Research Say?
Good to Great Companies
1
2
3
4
6
7
8
T-1
Transition Point T+1
Ratio of Cumulative Stock Returns
to General Market
Good toGreat
0
2
4
6
8
10
12
14
16
18
Built to Last Companies
Ratio of Cumulative Stock Returns
to General Market
Builtto Last
S& 500 (less Gallup50)
Gallup50 vs S& 500
Avg. Closing Stock rice
( 9 = 00)
Gallup50
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Good...to Great: Key Drivers
Hedgehog Concept:
Simple but
comprehensive
understanding
Culture of
Discipline:
Disciplined
people, thoughts
and action
Flywheel:
Continuous buildup
Brutal Facts +
Absolute Faith:
All the time
Technology
Accelerator
People first,
Strategy second
Level 5 leadership
Good to Great
companies
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The Hierarchy
Level 5:
Executive
Level :
Effective Leader
Stimulates group,Catalyzes commitment
Level : Competent manager
Organizes people and
resources towards the
effective pursuit of objectives
Level : Contributing team memberContributes to the achievement of group
Objectives. Works effectively in a group setting
Level : Highly capable individual
Makes productive contributions through talent,
knowledge, skills and good work habits
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Level 5 Leadership
Myth: Egocentric, larger than life,charismatic leadersmake a companygreat
Reality: Level 5 leadership = Genuine Personal humility
+ Intense professional will
Full fledged Level 5: Capabilitiesofall lower levels +Own special characteristics
Are a study in duality: They are modest and willful,shyand fearless. They act with quiet,calm anddetermination.
Rely principallyon inspired standards, not inspiringcharisma, to motivate.
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Level 5 Leadership cont.
Routinelyselected superb (often Level 5)successors: Left a company that would be greatwithout them
Can level 5 be developed ? ..............
A necessary but notsufficientcondition for a good
togreat transformation
Few Examples: Darwin Smith, CEO Kimberly ClarkColman Mockler, CEO Gillette
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Level 5 Leadership cont.
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Ad
ifferent Perspective
Relating LevelsofLeadership
ToOrganizational Structure
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Transformational Leadership
Organizational Structure
Level one, anunempowered
environment,positions the leaderabove andseparate from the
workgroup.
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Transformational Leadership
Organizational Structure
At level two The leader movesfrom
above the workers to
the center of the unit,but a clear distinctionstill exists betweenwhat the leader doesand what people in theworkunit do.
The leader iscentral tomostcommunicationwithin the group andchannelscommunication fromupper management tothe group.
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Transformational Leadership
Organizational Structure
At level three, The leader begins toshift
decision-making authorityforbasic tasks to membersof thegroup or the workgroup as a
whole. Some members might begin to
take on responsibilitiesbelonging traditionally to theleader.
The leader also encouragescommunication,cooperation,
and teamwork amonggroupmembers whenever possible.
However. the leader still iscentral to the group, especiallyas the initiator of the transitionto empowerment.
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Transformational Leadership
Organizational Structure
At level 4 No longer central to decision
making, the leader becomes apartner togroup members in levelfour.
The links between group membersmight become even stronger.
They might depend on eachotheras much ason the leader forinformation,help on decisions,and support.
Their scope ofempowermenthaswidened.
Notonly dogroup membersmake decisions abouthow they dotheir jobs, but they also assumemanyof the responsibilities anddecisionsformerlyheld by theleader.
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Transformational Leadership
Organizational Structure
At level five,
Group members are self-directed.. The leader's
primary role is tocoach,counsel, and support them.
Group members takeresponsibilityfor and makedecisions about tasks andjobs, including most
responsibilities thathad beentheir leader's.
The leader still providesdirection and acts as aresource,often tacklingissuesoutside the group.
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First Who.Then What
This means:
Level 5+
Management Team
(Good to GreatCompanies)
AGenius with a
Thousand Helpers
(ComparisonCompanies)
Level 5 Leader Level 4 Leader
First Who
Get the right peopleon the bus. Build asuperior executive
team.
First What
Set a vision forwhere to drive the
bus. Develop a road
map for driving thebus.
Then What
Once you have theright people in place,figure out the bestpath to greatness
Then Who
Enlist a crew ofhighly capable
helpers to makethe vision happen
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The Hedgehog Concept
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The Hedgehog Concept
It issimple
Know the one bigthing and stick to it
It is an understanding,not a strategy
Getting a HedgehogConcept is an iterativeprocess
It took an average offour yearsfor the G2Gcompanies toget aHedgehog Concept
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What are your three circles?
What are you thebest in the world
at? What drivesyour
economic engine?
What are youdeeply passionateabout?
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The Hedgehog Concept
A Hedge Hogconcept is not agoal to be the best, a strategy tobe the best, an intention to bethe best, a plan to be the best.
It is an understandingofwhatyoucan be the best at.
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THE FLYWHEEL AND THE
DOOM LOOP
Tremendous powerexists in the fact ofcontinued improvement and the
delivery ofresults. Point to tangibleaccomplishments people see and feelthe buildup of momentum, they will line
up with enthusiasm.
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Thus, the difference made by level 5
leadership can be seen as follows:
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What DifferenceEffective Leadership
Makes
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Management Leadership
.. but . both are important !!!
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*John KotterLeading Change
Planning and Budgeting
Organizing and Staffing
Controlling and ProblemSolving
Management
Management isNotLeadership*Management isNotLeadership*
Establishing Direction
Aligning People
Motivating and Inspiring
LeadershipAND
Produces Degree of
Predictability & Order
Produces Change
(often to a dramatic degree)
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Thank You !
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