Is Tough-Ass Leadership Better Than Servant Leadership?
Is Tough-Ass Leadership Better Than Servant Leadership?
As a Western society we’ve been enraptured with leadership for decades. The past 30 years have witnessed a tidal wave of books on leadership and management, with most of them having short shelf lives and, in reality, providing gimmicky messages based on flimsy or non-existent research.
One segment of the literature has conveyed the core message that those in charge of organizations should follow a servant-oriented approach to leadership. Adapted from Robert K. Greenleaf’s work, servant leaders exist to serve their followers as they work to advance their organizations towards shared visions. In short, a servant leader has the natural feeling to serve to lead others, in contrast to wanting to lead based on authority and power.
However, in a period of escalating global competitiveness, characterized in part by a race to the bottom when it comes to wage rates and working conditions, some would argue that being a nice boss and being inclusive by practicing a servant leadership philosophy is a recipe for disaster, where the take-no-prisoners approach by hungry emerging economies is the new reality.
Welcome guys like cut-throat Oracle founder and CEO Larry Ellis and retired General Electric CEO Jack Welch. Did I say “welcome?” Well, let’s take a look at a selection of CEOs who could be deemed mean jerks versus servant leadership corporate managers, and what their results were for the companies they lead.
First up, Larry Ellis (pictured below). Never one for mincing his words or chewing out a subordinate, Ellis attracted attention by lambasting Hewlett-Packard (a company with which he had previous good relations) when it fired high-performer CEO Mark Hurd in December 2011 for what turned out to be false claims of sexual harassment. Ellis, who seemed to take exquisite glee in criticizing HP’s management, subsequently hired Hurd (the subsequent legal issues were apparently been worked out).
In her 2003 unauthorized biography of Larry Ellis “Everyone Else Must Fail,” Karen Southwick(who died from cancer in 2004) stated that he was a “…modern-day Genghis Khan” because of his ruthless business approach, which includes his intolerance for anyone who gets in his way.”
This is the CEO who is said to show up for meetings when he feels like it, discards senior rising stars and exudes narcissism like no rival. Yet Ellis is ranked as the fourth richest person in the United States with a net worth of around $59 billion.
However, the 74 year-old Ellis produces results, despite his alleged poor listening skills, top-down management style and lack of empathy. For one thing, he’s known for hiring very talented people who deliver. Oracle’s annual revenues in 2018 (end of May fiscal year) were $40 billion US. The company has a long list of acquisitions of diverse technology companies.
Would Oracle be better off financially if Ellis had been practicing servant leadership?
A second tough-ass CEO was “Neutron” Jack Welch (pictured below), head of General Electric between 1981 and 2001. Now 82, Welch has been viewed as the catalyst who relentlessly drove GE to streamline its operations by shutting down factories, running lean inventories, de-layering management, and laying off employees. His focus for GE was being number one or two in any market in which it competed. Non-performing managers didn’t last long under Welch. Indeed, he conducted an annual firing of the bottom 10% of underperforming managers.
And it worked – depending on to whom you speak. Welch was a hero to many in the corporate world, yet he still has many detractors who argue that the lifeblood of any organization is its employees, managers and staff. Nuking managers on an annual basis is not the way to lead an organization, according to Welch’s opponents.
Since retiring from GE, Welch has done a number of media interviews, from which he has had to backpedal a few times. For example, in a March 12, 2009 interview with The Financial Times he stated: “On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy…your main constituencies are your employees, your customers and your products.”
That comment got a reaction from other CEOs: would Welch have made the same comment when he was in charge of GE? The topic of shareholder value and who are the primary constituents of a corporation continues to be battled out in the business literature.
One can argue endlessly whether Larry Ellis, Jack Welch and others have taken the correct route in leading their respective companies. In fact, some might say that the role of a corporate CEO is not to engage employees in a collective singing of Kumbaya, but rather to demolish the competition and ensure that the company remains at the forefront. You’re either on the bus or under it, as the popular expression goes.
In fact, let’s look at the issue from an even more global level: China. This country’s dramatically impressive growth rates and steady climb up the value chain in manufacturing has been based on results-based management with little margin for error. The on-the-bus analogy is very apt here.
Many leadership practitioners don’t validate the process of brow-beating subordinate managers and staff, preferring the approach of aligning and enrolling people to work towards a shared vision and common purpose. However, others would accuse them of being softies. The financial results of GE under Welch and Oracle under Ellis are indeed impressive.
As a contrast to the CEO as emperor, let’s look at some other company leaders who have lead successful enterprises using very different people-oriented approaches.
Max Depree (Pictured below), retired CEO and respected leadership author provides a compelling case for a servant-oriented approach to leadership. DePree, who’s written such concise books as Leadership is an Art and Leadership Jazz bases his writings on his real life experiences in running a highly successful company.
His father, D. J. DePree, founded office furniture manufacturer Herman Miller in 1923, purchasing the Michigan Star Company with his father-in-law Herman Miller. Max and his brother, Hugh, began to co-manage in the early 1960s. In the mid 1980s Max took over as CEO, holding that position until 1990. He subsequently launched a career as a highly successful author on leadership. The Max DePree Center for Leadership continues to promote his beliefs and practices.
From the mid 1970s to the mid 1980s, Herman Miller was rated as 7th globally in return on investment. However, of particular significance was Max’s emphasis on integrating his beliefs into the company’s culture. The Scanlon Plan, a program that encouraged and rewarded employee participation, was one major outcome.
Herman Miller continues its focus on employee engagement, product quality and customer service through its commitment to operational excellence, which encompasses production systems, employee ownership, innovation and economic value-added. Herman Miller has been ranked as one of Fortune magazine’s most admired companies for the past consecutive 18 years.
Let’s look at a second CEO who has been part of an amazing story in the competitive and volatile airline industry. Southwest Airlines began operations in March 1967, serving just three cities in Texas. During its four year history, the airline has grown to be the world’s largest low-cost carrier, earning repeated accolades along the way for its focus on customer service and its humane treatment of its employees.
The current CEO is Gary C. Kelly, who took on the new role on July 15, 2008. However, Kelly began his career with Southwest in 1986 as comptroller, subsequently working his way up to CEO. It’s not a usual part of a CEO’s job description to dress up in a silly costume for Halloween, but Kelly has a way to inspire fun in the workplace. This is the CEO who makes a point of sitting beside customers and employees on flights to listen to their concerns and flying experiences.
Southwest Airlines has faced the same challenges as other airlines over the years. However, Kelly has resisted layoffs and instead engaged employees on ways to address challenges.
Here are a few metrics that underscore the success of Southwest Airlines. First, it had achieved 45 consecutive years of profitability in 2017, ranked #1 in customer satisfaction in 2016 by the U.S. Department of Transportation, and $543 million in employee profit-sharing in 2017. Kelly, himself, has been the recipient of numerous leadership awards, including leading one of America’s top workplaces.
To reach this level of success in what has been described as a dysfunctional industry is extraordinary. It was not done easily, yet Southwest’s formula for success is not a trade secret; it’s about treating employees as human beings and keeping them engaged and aligned towards the corporation’s core purpose.
Southwest Airlines has gained noteworthy attention over the years by the humour its flight crews use as a way to lighten the tension the flying public often has and to make the experience more human (see photo). Here are but just two examples that illustrate this humour. It’s useful to note that some other airlines, including Canadian ones, have tried to replicate this humour, but not as successfully as Southwest. Why? Because employees have to be happy in their work to be funny.
From a Southwest flight attendant who intervened when passengers were taking too long to get seated: “People, people we’re not picking out furniture here, find a seat and get in it!”
During a pre-takeoff safety explanation on the intercom from a flight attendant: “There may be 50 ways to leave your lover, but there are only four ways out of this airplane.” So what’s the verdict, folks? There are success stories on both sides of the CEO-as-tough-ass versus servant leader issue.
For companies like Southwest Airlines and Herman Miller, they have stood the test of time and continue to remain profitable. It will be interesting to watch how Oracle proceeds into a rapidly changing world of technology. General Electric already has had its ups and downs and faces some big challenges. The recent departure of long-serving CEO Jeffrey Immelt for John Flanery caused some initial positive speculation about the company’s share price and future growth, but that has subsided.
In the end it’s our personal decision where we wish to work. Yes, even in a tough labour market there are times when some soul-searching is needed.
From your own perspective and experiences, where would you prefer to work when it comes to how executive leadership is practiced?
Take a moment and share a comment.
The workplace is an incubator for the human spirit. (The late Anita Roddick, Founder of the Body Shop)
#2 I do consider Jack Welch as very overrated and without Crotonville his legacy would placed him where I think he actually belongs, which is to be mentioned in the same breath as Chainsaw Al, but most people today have forgotten what Albert J. Dunlap did in his prime of his CEO career and Welch was not that far different from him. When one looks at the enlightened GE rather than the brutal GE, then we begin to see where the big thinkers were within Crotonville, people like Ron Ashkenas and Noel M. Tichy, people who were cognitively superior in their thinking. Where I do give credit to Jack Welch is because in my opinion those are the coattails he rode on that made him a "celebrity CEO". In terms of Steve Jobs death, the important aspect here is whether the cult of personalty held Apple together or was their a sustainable culture, and Jobs who knew he was dying prepared for that succession, indeed he pointed to what happened at HP as a warning to what he did not want to happen at Apple. He had a great affinity with the founders of HP but not with the organization that lost its way after the HP founders passed away. That affinity led him to buy up the land that formerly belonged to HP and he designed his swansong - the round spaceship new Apple headquarters - it is not just the shape of the circle that was important to Steve Jobs, it was the meaning of the land that this building sat upon. People think Jobs failed in his NeXT Cube but NeXT was really about what was next for Jobs - his crazy pricing of the Cube and decisions that made no sense, actually made complete success - because Jobs had envisioned Apple buying NeXT and what he did there paved the way to the Apple revival and the Apple we know today. Jobs did not want Apple to die while he knew he was dying - and so far Tim Cook has maintained that legacy and the vision we can now call the hereafter.
#1 Thanks for taking the time to add insightful comments. On Welch, some now say he was overrated as CEO and benefitted from the conditions at the time. I've read a little on Jack Ma, a former teacher, who is a unique corporate leader. I've wondered at times what Apple would be like had Jobs not died. I recall his burning desire--call it obsession--to nuke Android. That hypothetically could easily have sucked up Apple's resources for a revenge spree. I'm an Apple user and a fan of Cook. And then there's Bezos. He's only getting started...
With Ellison love him or hate (and I don't very much like him) what sat underneath the massive ego and ruthless manner was a visionary in his particular space. Not as true with Jack Welch who was just as ruthless but Welch's fame can be traced to him mellowing down and utilizing the collective braintrust of the leadership excellence practice which was GE Crotonville https://www.ge.com/reports/inside-crotonville-ges-corporate-vault-unlocked/ What Crotonville gave to Jack Welch was the thinking that came naturally to Larry Ellison. Ironically the two other ruthless visonaries in the tech space have been Steve Jobs (who out did even what Ellison could accomplish) and now the most ruthless of them all which is Jeff Bezos and the frightening emerging power of Amazon. Yet in the tech space there are example of servant leaders like Jack Ma - except behind his servant leadership is a different kind of ruthless action, but it is an action driven by thinking that we would associate with servant leadership. Jack Ma is not a techie, he has surprising lack of competency in the technical aspects of his businesses yet he is a supreme showman and he has a great read on the human condition and what motivates people. One can get a sense of that in an outsider perspective from Duncan Clarke in this piece https://heleo.com/conversation-an-insiders-account-of-the-jack-ma-phenomenon-how-alibabas-founder-built-his-following/11627/ Tim Cook cannot run Apple the way Steve Jobs did because what and who is isn't what Jobs was - but Jobs knew that Cook knew how to delegate and draw in the best minds and that drawing in fills in some ways the visionary vacuum that Jobs had on his own - realizing that Jonathan Ives is still at Apple. Jack Ma has more in common with Cook in this respect but Jack Ma is a visionary like Jobs and Ellison. Study leadership based on contextual intelligence otherwise what we study is mythology.
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Comments
Jim Taggart
5 years ago #5
Indeed. I recall Chainsaw Al from his tenure at Sunbeam.
Jim Taggart
5 years ago #4
Indeed. Not sure what has caused Rudy to become a raving fool at times.
CityVP Manjit
5 years ago #3
I do consider Jack Welch as very overrated and without Crotonville his legacy would placed him where I think he actually belongs, which is to be mentioned in the same breath as Chainsaw Al, but most people today have forgotten what Albert J. Dunlap did in his prime of his CEO career and Welch was not that far different from him. When one looks at the enlightened GE rather than the brutal GE, then we begin to see where the big thinkers were within Crotonville, people like Ron Ashkenas and Noel M. Tichy, people who were cognitively superior in their thinking. Where I do give credit to Jack Welch is because in my opinion those are the coattails he rode on that made him a "celebrity CEO". In terms of Steve Jobs death, the important aspect here is whether the cult of personalty held Apple together or was their a sustainable culture, and Jobs who knew he was dying prepared for that succession, indeed he pointed to what happened at HP as a warning to what he did not want to happen at Apple. He had a great affinity with the founders of HP but not with the organization that lost its way after the HP founders passed away. That affinity led him to buy up the land that formerly belonged to HP and he designed his swansong - the round spaceship new Apple headquarters - it is not just the shape of the circle that was important to Steve Jobs, it was the meaning of the land that this building sat upon. People think Jobs failed in his NeXT Cube but NeXT was really about what was next for Jobs - his crazy pricing of the Cube and decisions that made no sense, actually made complete success - because Jobs had envisioned Apple buying NeXT and what he did there paved the way to the Apple revival and the Apple we know today. Jobs did not want Apple to die while he knew he was dying - and so far Tim Cook has maintained that legacy and the vision we can now call the hereafter.
Jim Taggart
5 years ago #2
Thanks for taking the time to add insightful comments. On Welch, some now say he was overrated as CEO and benefitted from the conditions at the time. I've read a little on Jack Ma, a former teacher, who is a unique corporate leader. I've wondered at times what Apple would be like had Jobs not died. I recall his burning desire--call it obsession--to nuke Android. That hypothetically could easily have sucked up Apple's resources for a revenge spree. I'm an Apple user and a fan of Cook. And then there's Bezos. He's only getting started...
CityVP Manjit
5 years ago #1