Bold Leadership for Organizational Acceleration

Interview by Andrew K. Reese

Leaders today must balance hectic business and personal lives that can leave them feeling like they are trying to squeeze 15 pounds of apples into a five-pound bag.

As a result, says business consultant Jim Tompkins, CEO of Tompkins Associates, leaders too often find themselves facing extreme overload, powerless to cope with constantly evolving challenges, incapable of leading others and unable to concentrate on the big picture. But in his recent book, Bold Leadership for Organizational Acceleration, Tompkins proposes a plan to help executives get out of overload mode, professionally and personally, so that they can be more effective leaders in all aspects of their lives.

Supply & Demand Chain Executive recently spoke with Tompkins about his prescription for addressing organizational and personal overload, and we began by asking him about his motivation for writing the book and addressing this particular topic at this time.

Jim Tompkins: I have watched very good companies — and even great companies — become like deer frozen in the headlights of an oncoming car when they start to experience what I call "organizational acceleration." As they have downsized, everyone in the company, from the CEO down to the lowest-paid, newest employee, starts trying to fit 12 pounds of apples into a 10-pound sack. And then they add on top of that their personal lives, where they've got soccer practice and baseball practice and piano lessons and dance lessons, and there are simply not enough hours in the day.

I've seen this type of situation more and more often, and, to be perfectly honest, it became a frustration to me when I saw companies that needed to hire our firm to do consulting work, but because they were so busy "doing nothing," they never had time to get together and decide whether they should hire a consultant or not. As I started to think about this frustration, I came up with three answers to address this problem.

Number one, we've got to understand how to take off of our plates those things that can be done by others. This led me to believe that the process of inspirational leadership — which is a process that I introduced at Tompkins Associates some 10 years ago — needs to be spread throughout the world. Secondly, we've got to make sure that our people only focus on things that are truly core and that we don't waste our time on non-core activities. And thirdly, we've got to build a structure that plans and responds to surprises. If we don't have good resiliency, if we don't have proper contingency plans, if we don't properly understand the process we need to deal with disruptions, we're never going to be able to achieve success in our business.

That became not only the inspiration for writing the book but the solution to the never-ending organizational and personal acceleration that was consuming companies and people and resulting in a tremendous amount of heartbreak and ulcers and alcoholism and disrupted marriages, etc., etc. So I see this organizational acceleration as a cancer, and this book is the cure for the cancer.

Supply & Demand Chain Executive: Why "bold" leadership? What separates a bold leader from "just a leader"?

Tompkins: The traditional textbooks and literature on leadership teach us that leadership is something that one does or that one exhibits. That was great back when life was slower and organizations were slower. You could have three leaders in the company and everyone else could be a follower, and you could be successful. But we need to take a different approach to leadership now because there's simply 100 pounds of leadership to be done, but the maximum that anyone can handle is five pounds. The true test of a great leader today is not your own leadership skill but how many leaders you can create within your organization. What I, as a leader, need to do is identify the boundaries of what you are capable of performing, prepare you to do those things, and then inspire you to become a leader at the right time to get those things done. That's what I mean by "inspirational leadership," which is the first facet of bold leadership.

The second facet of bold leadership is to be bold enough to say I, as the CEO of this company, am only going to work on core primary tasks. All other corporate processes or tasks are going to be handled by others, and in fact I'm going to outsource many non-core tasks, be they primary or secondary, because there's no way we're going to do a great job on core processes if we're spending our time on non-core tasks.

And then the third part of bold goes back to resiliency. We have to force people who are already over-busy to develop contingency plans. When the odds of any of these contingencies occurring is probably less than 5 percent each, people are going to say they don't have time to develop those plans. But the boss needs to say, "Yes, you do, because if this issue happens to us and our supply chain shuts down, guess what, we don't exist as a company." Of course, you don't need to have a contingency plan or a resiliency plan in place if the grass gets too long or if the water fountain in the cafeteria doesn't work or if employees don't like the food in the cafeteria. But you do need a contingency plan if the only provider of rubber that you use to make your shoes has a strike or their plant catches fire. What do you do then? Well you need to have a plan for that, and you need to be bold enough to force your people to develop that plan, to test that plan, to make sure that plan is current, to make sure that you as an organization and as a supply chain can be resilient.

That's what bold is about. Bold is about taking a different approach to leadership, a different approach to core competency and a different reality to resilience.

SDCE: Resilience, of course, relates directly to the supply chain, and we recently put out an article about "disaster-proofing the supply chain." What grade would you give companies, on average, in terms of building resilience into their organizations?

Tompkins: On a scale of zero to 10, I think the average American business today is a good, solid point-five. Some people have thought about it, and some people might even have written a couple of e-mails on it, but other than the IT function you don't find it anyplace in the organization. Katrina has helped because it's taken the probability from "Come on, we're never going to get hit by a hurricane" to "Wow, there is a probability and we need to plan for it."

SDCE: On the issue of core competencies, why is it that right now, at this particular time in history, it's become more important to focus on core competencies. Are there factors that are making it more important now then it was 15 or 20 years ago?

Tompkins: For years we had too many people in our companies. We had enough people to handle the core primary, the core secondary, the non-core primary and the non-core secondary tasks and processes. You couldn't outsource benefits administration 15 years ago because there weren't organizations that could do that. Thirty years ago there wasn't anyone you could outsource landscaping services to, and every company had a janitor who had two lawnmowers. But then companies realized they needed to become more efficient, and so they cut out the staff [doing the non-core tasks]. Today there are people that can do benefits or cut the grass for you, and they can do it much better and much cheaper than you because that's their core competency. So companies contract for those capability and get it off their plates.

The challenge is that we thought contracting was truly outsourcing. So now, when we want to outsource our distribution, we ask the same guy in purchasing that did the contract for the landscaping service to use the same process to select a third-party logistics provider. He calls three large 3PLs in the phone book, everyone submits a three-page proposal, we take the low bid, and the winner comes in and totally messes it up because they have no understanding of our business. There's a huge difference between contracting the landscaping and outsourcing your logistics, and we need to understand that outsourcing is a process that all organizations need to have as a core competency. The paradox here is that management must outsource non-core things so they can focus on the core, but oftentimes they do not have a core competency in outsourcing. As a result, they mess up what they outsource, and that requires them to spend more time on a process than if they hadn't outsourced it in the first place.

SDCE: With where we are as an economy, with the focus very much on the next quarter's results and with tenures in leadership positions being so short, does that create an institutional or structural barrier that militates against the ability to exercise the kind of bold leadership that you're talking about?

Tompkins: It certainly can if we don't do inspirational leadership. But what inspirational leadership should allow us to do is offload from the leader's shoulders the day-to-day [tasks] and give the inspirational leader time to focus on the strategic. Those are the core primaries, and if we're really focusing in on those core primary activities, we do have time to handle quarter-by-quarter goals as well as the next year or two years or five years out.

SDCE: Is there any one or two companies that you would say are the leaders — that "get it"?

Tompkins: General Electric. GE under Jack Welch, and now under Jeffrey Immelt, has really, really understood the reality that yesterday's success was yesterday, and what am I going to do to achieve the next level of success and how do I reinvent myself. They've done that better than anyone, and they very definitely practice inspirational leadership. That's what all the GE training and the GE University is about. They clearly focus on core, and, in fact, if it's not core, they get rid of it immediately. And they probably do a better job on resilience planning than anyone else out there. So yes, I would say GE.

More information about "Bold Leadership for Organizational Acceleration" is available at www.tompkinsinc.com/boldleadership/default.asp.

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