"Leadership," writes the historian James MacGregor Burns, "is one of the most observed and least understood phenomena on earth." (3) Indeed, there are untold volumes on leadership. There are business chronicles, stories of great corporations and their achievements, some exposes, and other vehicles of self-justification. There are descriptions of ends attained, of outcomes. There are news reports of spectacular executive success. But nowhere is there specific documentation of the characteristic behavior of business leaders. Nor is it easy to define what a business leader is. The business world is an arena for achievers. Some are great financial manipulators. Some are spectacular marketeers. Some are technical innovators. Some build and rebuild communities. Are they leaders? They are executives, perhaps, but not always leaders.
We cannot always learn, and certainly not fully, about leadership from theorists or from contemporary "leaders." Nor can we learn fully from great political leaders. Gandhi was charismatic and revolutionary. His leadership made the British yield India, but until the recent popularity of the movie Gandhi, there was little evidence in contemporary India that he even existed. De Gaulle was similarly charismatic. He inspired a defeated France, but he left it with only echoes of stirring words. By way of contrast, the leaders of the American Revolution created an adaptive structure--a mode of organizing people and activities that was capable of changing itself when necessary--to sustain the ideals they verbalized. Similarly, there have been great businessmen-Carnegie, Rockefeller, Sloan, Ford, Harriman--who created mammoth businesses, most of which have adapted poorly to their environment. Their organizations have had difficulty enduring for, among other things, they were without the kind of adaptive structure that could either generate ideals or sustain them.
Sociologists argue that when large organizations falter and fail it is because of bureaucratic rigidity, which Marxist economists contend is the result of capitalistic oligarchic power. Such structural explanations attribute failure to the way the business is organized or the economy is managed. But we know from military experience that while one battalion might have high morale, few casualties, and great combat success, a comparable battalion might have quite the opposite. The same is true of comparable manufacturing plants in the same corporation. Other factors being relatively equal, the most significant difference between one organization and another is neither sociological nor economic. Rather, it lies in a leadership style that gives direction, evolves structure, and allocates power. That leadership style is most relevant to much of contemporary management when it can be viewed in the context of a highly structured organization with established traditions and a long history of how things are done. Since entrepreneurs have their own unique psychology, I am interested in those who assumed leadership of ongoing businesses.
If we are to try to understand leadership style, we have several options. One is to classify it, as do most research studies on leadership. We can do that by using labels: autocratic, democratic, laissez-faire.(4) Or characterizations: the craftsman, the jungle fighter, the company man, the gamesman. (1) Or by placing the leadership style on axes: personoriented versus production-oriented. (2) Or by differentiating the achievement-oriented from the power-oriented or the affiliation-oriented. (6) Or we can characterize their temperaments: intuitive versus analytical. Another way is to try to measure leadership style after defining the traits, qualities, skills, or behaviors that characterize it.
Although the issue is little discussed by contemporary theorists of leadership, clearly the leader has to be able to take charge. Participative efforts will flounder without careful and guided direction from the leader in the form of specific actions. even in the examples of temporary organizations which Warren Bennis and Philip Slater use, somebody is in charge. () Somebody has the right to hire and fire. Somebody has the right to make final artistic, conceptual, financial, or other deci- sions. A major fault of contemporary theorizing on leadership and organizations is precisely that it does not discuss this issue. It is as if writers were unable to differentiate between being authoritative and being authoritarian, and, therefore, the appropriate exercise of authority is viewed as being not good managerial behavior.
None of the Ceos that were interviewed spoke of a specific charge from a board of directors about what he was to do when he took over. Nor did any of them start out with a vision, as MacGregor, Watson, and Sulzberger specifically indicated. each had to define his own problems and map out his methods for resolving them. That meant that each had to fall back on his internal road map, based on his organization's history and his previous experience. each had to be an expert diagnostician. Jones laid out the six problems he faced at Ge, Hanley the three major issues he faced at Monsanto, and Sulzberger the four most prominent concerns at the Times. each set out on a path of resuscitation and recovery. Wriston saw the world as one economic unit and the need to prepare to compete in those terms. MacGregor saw a world of declining natural resources and rising inflation, and therefore advocated acquiring more mines. Watson discovered that Univac had taken the computer lead and threatened IBM's customer base; at his insistence, IBM engineers overtook Univac in two years. Sulzberger saw no adequate management and the looming impoverishment that would follow the continuous union drain on the resources of a single business unit. (8) All were clear about what they were going to do and how they were going to do it.
But diagnosis is never enough, nor is ad hoc action a satisfactory basis for continuity. Certainly, it does not give meaning to the organization or form a coherent focus for the needs of the people in it, nor does it provide a structure to translate that meaning into continuity of organizational behavior. The point to note, therefore, is that each of our CeOs took charge of his organization and took it in a new direction. In the mode of adapting animals who lose some functions in evolution only to develop others that enable them to survive, they deliberately altered their organizations. Survival meant to be different but quintessentially the same.
Thus, although their organizations, by and large, did what they knew how to do best, each of our leaders shifted the focus and direction of his organization into unfamiliar areas. Jones and Watson pushed into electronics, Wriston into consumer financing, MacGregor into aluminum manufacturing, Hanley downstream into proprietary products, and Sulzberger into acquisitions. Yet for all of the transformations they initiated, their companies did not lose their identities. They were, like children grown to maturity, recognizable but unrecognizable. They were outgrowths of what they had always been.
In order to make these changes, each of leaders attacked entrenched perceptions and practices that had become set in organizational concrete--product, technology, structure. each insisted on a new definition of reality in keeping with his own diagnostic perceptions. These leaders were like trout swimming against swift currents. They couldn't stop. They stayed alive in a metaphorical sense by encountering and enduring in the cold, harsh, forceful environment in which they lived. Indeed they sought the advancing currents; they sought change. Theirs was an upstream orientation.
Throughout the process of transformation each of our leaders was clearly in control, both formally and psychologically. None had difficulty taking charge and maintaining that control, either by managing the purse strings, like Jones, MacGregor, and Hanley, or by sitting atop the vast information heap. When edict was necessary, it came. Watson set a deadline, after which there would be no more computers with tubes, and delivered edicts regarding personal behavior. Sulzberger said there would be one paper, daily and Sunday, and not two. Wriston himself took charge during the New York City financial crisis. each grew further into his role, whether through internal maturation in the organization, as did Jones, Watson, Wriston, and MacGregor, or by having to confront crisis, as did Hanley and Sulzberger. (5)
Despite self-doubt, each of these leaders was strong and took a position when that was necessary. MacGregor opposed the Hochschild faction to make a deal with Pechiney and fought that group repeatedly. He faced down his putative rival, Donahue. He could be stubborn about the nickel business. each of the others stood against the entrenched wisdom of his organization and even against those who knew technology better than they. They did not vacillate, at least publicly, in the face of decisions that often required spending hundreds of millions of dollars. They were able to stick with their convictions until they brought their followers around. What they achieved, therefore, was not, as Hanley would have it, just dumb luck. each could have failed despite the enormous resources behind him.
The thespian talents of our leaders, another form of taking charge, bloomed late but well. each developed a platform presence that added to his stature as a public figure. That same presence allowed subordinates to take pride in the public figure whose handling of the public aspect of his role redounded to the advantage of the company. each had his share of Potomac fever and enjoyed the association with governmental power and famous figures. Though Sulzberger does not have thespian talents, his warm, self-effacing style quickly wins over groups and audiences.
All of our leaders except Hanley had been involved with their organizations early on. Hanley, who came late in his career to Monsanto, had been at Procter and Gamble for all of his prior executive history, stayed at Monsanto for the rest, and invested himself in his new organization beyond the specific behavior required by his role. each of the others did the same. Jones, Watson, Wriston, and Sulzberger appeared to be more highly influenced by the organizations they led. (4) MacGregor was not satisfied with being able to get along with his board. He clashed with them because of his vision of what AMAX could be and did become. He was committed to achieving that vision for that company, although, as history confirms, he easily could have gone elsewhere. each appears to have made his company more important than himself. (10)
Yet none was blinded by this commitment to the organization. Commitment can easily turn into a personal cause, which can turn into narrow and rigid pursuit of an impossible ideal. Their commitment was not to exploit the organization for a personal cause, whatever that might be, but to integrate their personal causes with the organizations' needs. Of course, they may well have rationalized the gratification of many of their personal needs by justifying their actions as organizationally necessary. All executives, being human, do that to some degree. But here the organization came first. They knew their organizational histories and took them into account. "Working with the grain," Jones called it. each had to do what his own personality enabled him to do. each established a comfortable degree of fit, although it was harder for a new man like Hanley to do so. Indeed, when their successors took over at Ge, Citicorp, IBM, Monsanto and AMAX, they were different men who now had to confront different technical, financial, and competitive worlds, requiring a different kind of fit. (4)
The leader must interact with customers, employees, and other constituencies supportively. That means that he or she must not only touch others in a personal way, but do so warmly and consistently so that all recognize his integrity--managing "the soft S's" as described by Pascale and Athos. (9) Ideally, such a powerful person interacting with others gives them permission to act on behalf of the organization. This, in turn, leads to strong bonding and identification, especially if the leader is intuitive and empathic. As we noted earlier, the leader historically has developed support from others and, having learned to use it, is able to support others. The leader anticipates disappointment and defeat and helps his people cope with them by sharing skills, competences, expertise, and sophistication. He is also a powerful voice upon which people can depend for disapproval. This last quality, a form of aggression, is not touched on in most of the contemporary discussions of leadership. Yet we found it an important part of the leader's role. If one is to hold up an ideal, then one must also reject that behavior which compromises the ideal. It is not enough merely to hold it up.
There were no ivory tower isolates among leaders, nor were they preoccupied with the customer alone, though they gave careful attention to him and her. Our vignettes are replete with illustrations of interactions with multiple constituencies. The literature of leadership does not touch much on the relationships of leaders with their boards or with their closest confidants. Our leaders tell us they were acutely sensitive to both. The literature of leadership tends also to ignore the political aspects of leaders' roles. These leaders did not. All of them took an active role with respect to various levels of government, and with overseas governments. They were politically sophisticated and often acted beyond their own self-interests. They became statesmen.
They maintained their organizations as systems open to outside information and capable of acting on it; indeed, they encouraged that response. They seemed to give congruent signals, to say what they meant (except in some intimate, painful personal situations) and mean what they said. They are likeable men even when they do things that hurt. Watson, for example, balanced his attacks with reconciliation that restored the loving image. (8) At the same time his behavior invited attachment because of the relief he afforded after creating so much pain. By "getting in the boat" with their subordinates and accepting joint accountability, they reduced paranoid fears of being up against a hostile environment, alone and vulnerable. They struck others as being "lovers" not haters.
One of the factors that enabled leaders to stay clearly focused on reality was that they were eminently practical men, despite their capacity for high-level abstraction. (We think it is that practicality, particularly, that differentiates leaders from those valedictorians who never achieve power.) They "smelled" the marketplace.
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