In Discover Your True North, Bill George offers insights on how to become an ‘authentic leader” and develop an inner compass that helps keep you and your company on a sustainable, profitable path.

The hardest thing we have to do in business is to see yourself as others see you. – Bill George, author, Discover Your True North

Title: Senior Fellow
Organization: Harvard Business School
Executive Experience: former Chairman and CEO, Medtronic

Being the leader of a company can be fraught with peril, warns Bill George. If you run a public company, there is more pressure than ever to make every quarter’s results better than the last. Along with those pressures, company leaders can operate in a heady world of fame and financial reward. It is an intoxicating brew that can lead to terrible consequences. That’s why leaders need an internal compass that keeps them on the right path.

In Discover Your True North (John Wiley & Sons, 2015), George, the former CEO of Medtronic and a senior fellow at Harvard Business School, brings fresh insights to how executives can become more effective leaders by resisting the temptations of power and staying true to their values. He advocates leadership that is based on authenticity and creates value for all of a company’s stakeholders.

That process involves practices to discover your “True North” – which George described to IndustryWeek as “your most deeply held beliefs, the values and principles that you lead by.” That requires a lifetime practice of pursuing self-knowledge, he says, but the rewards are leadership that creates trust in employees and develops the cultural foundation for the pursuit of enterprise success.

Stray from those principles and you can find yourself in the same boat as Rajat Gupta, the former managing partner of McKinsey. Gupta grew up in Calcutta and was orphaned as a teenager but he gained admission to a prestigious Indian university and went on to a very successful business career. But in 2012, he was convicted on four counts of insider trading and is currently serving a 2-year prison sentence.

Why would a wealthy and successful man put his career at such risk? George writes it was not a “simple case of greed,” but rather the result of never overcoming poverty in his childhood and the unquenched need for financial security.

“We saw that most of the leadership failures came about from people losing sense of who you are,” George said about his research for True North. “It’s not that they were bad people. It’s that they got pulled off course, either from pressures they couldn’t cope with or seductions – money, fame and power.”

The most important characteristic of leaders, George maintains, is that they be “authentic,” or true to themselves and what they believe in. For years, says George, companies weren’t necessarily looking for authentic leaders. Too often, he says, they were looking for corporate rock stars – the next Jack Welch. As a result, they often went outside their own ranks to find the next financial wizard who could promise quick results.

“I’m a very strong believer that leader should be promoted from within,” George told IndustryWeek. “We went through a decade where almost half of CEOs came from outside their organizations. That showed not only a lack of leadership development but many of these did not work out because they didn’t fit with the culture. They weren’t genuine people.”

George says he is much more hopeful about the current crop of business leaders, who he sees as more collaborative and interested in empowering employees to achieve lasting results.

“Today authenticity is seen as the gold standard for leadership,” he writes in True North. “No longer is leadership about developing charisma, emulating other leaders, looking good externally and acting in one’s self interest, as was so often the case in the late twentieth century.”

Being authentic is more than just a nice social characteristic; George says it is the foundation of business success.

“In business, trust is the coin of the realm,” he writes, as it forms the basis for “customers’ trust in the products they buy, employees’ trust in their leaders, investors’ trust in those who steward their funds, and public trust in capitalism as a fair and equitable means of creating wealth for all.”

Learning from Mistakes

Making mistakes in business is a common denominator, George declares. “We all go through it. Everyone has gone through adversity of one form or another.” But not everyone makes career-destroying mistakes. George says the “difference between those who succeed and those who fail is emotional intelligence and self-awareness.”

Emotional intelligence can be developed, George says, and begins with self-awareness. To become more self-aware, George advocates two routine practices.

• Have an introspective period of at least 20 minutes a day. George says we are bombarded by emails, social media and meetings. “We have to pull back from that, whether we meditate, pray, journal, take a jog,” he says, and use that time to take stock of the day and determine if we are “emphasizing what is important in our lives.”
• Get honest feedback from people you trust and will listen to. While introspection is important, you also need a support team that will give you honest feedback. While people you work with can help make up that support team, George says it is particularly valuable to have a group outside the workplace that you can consult with. He has been part of a men’s group for 40 years that meets on Wednesday mornings. “They can give you honest, sincere advice because they know you at a deeper level,” he said.

George says many leaders are burying childhood traumas or other setbacks rather than dealing with them straightforwardly. He says people have to go beyond seeing themselves as victims and come to grips with these negative events.

“Many people are strongly influenced by their parents in ways they don’t even understand and they are replaying that in the workplace,” George observes. “That is not healthy leadership. You’ve got to process that.”

“We present a new concept called post-traumatic growth,” George explains. “The idea is you take your difficult times and you grow from that. That is where you really learn who you are. It gives you the confidence and resilience to overcome very difficult times.”

Understanding how they overcame adversity can provide leaders with the desire to help others deal with their difficulties and grow as leaders. He compares that to a more selfish attitude of, “Hey, I made it. Why don’t you pull yourself up by your bootstraps?”

Not surprisingly, George is an advocate of 360-degree reviews in business. He said the best feedback he got in business was from his subordinates, not his bosses.

“The hardest thing we have to do in business is to see yourself as others see you,” he says. “The 360 review is one of the best ways to do it.”

Through better awareness of who they are, says George, leaders can move away from “external gratifiers like money and power” and toward leadership that is more about “making a difference and empowering other people.”

“We are all called to serve, in effect servant leaders” says George. “We’re not there to serve ourselves. People who work for us are not there to make us look good, just the opposite. We serve them and they are effective at doing their jobs. It is really critical that we make that journey and realize that leadership is not about us.”

One problem is that most of the metrics used to measure young people, such as SAT scores or college grades, are based on how they do as individuals, notes George. Individual achievement often continues to be the focus for young workers such as engineers or analysts. But as employees move up the ladder to leadership roles, says George, it is important to “flip that switch” and realize that your success comes from serving the people on your team.

“If you do that well, they will do anything for you. That then becomes how you build a successful enterprise,” he says. “People in organizations intuitively know which leaders are committed to the company and bleed the company’s colors, and who are in it for themselves.”

George says millennials are different from baby boomers. Unlike that “me generation,” he says, millennials tend to be very collaborative and less concerned about who gets credit for a successful project. And they exhibit fewer biases than earlier generations about race or sexual orientation.

Millennials also want to “make a difference,” says George. “By the way, they don’t want to wait until they are 40 or 50 to do it. They want to do it right now.”

Where is the US Manufacturing Compass Pointed?

What kind of U.S. manufacturing environment will these leaders operate in? George says the U.S. won’t find success trying to compete with China and low-cost manufacturing nations producing standard products.

“The U.S. needs to compete in complex manufacturing based upon product innovation,” he says. ‘I think that is its sweet spot.”

George says the key to that future is developing a new generation of skilled workers.

“There is a huge risk that our workforce right now is becoming obsolete, because we aren’t emphasizing the importance of a well-trained, skilled workforce,” says George. He adds there is too much focus on “generic college education” and not enough attention to vocational education. In that respect, Germany has done an “outstanding job,” says George.

“How can they sell machine tools all over the world – Korea, China, Japan ­ so effectively when they have very high-cost labor? They do so because of the quality and expertise. I think that is what the U.S. has to emphasize,” he says.

There is no country as innovative as the United States, George declares, but in order for that product innovation to continue, he says the nation must do more to develop its workforce expertise. That means more attention to the people that do the work on the shop floor, he notes, providing the training, tools and financial compensation so that manufacturing attracts the best people and rewards them for their contribution to the company’s success.

George clearly believes that a strong manufacturing sector continues to be vital for the American economy and people.

“Hollowing out our manufacturing base and making us a service economy, as some people were talking about 10 years ago, is very, very foolish,” George concludes.

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This article was originally posted 8/18/15 on Industry Week.

 

You overcame adversity on your own, through mental toughness, with no help–and it’s how you became successful. But it also could be your downfall.

One day in 2007, Arianna Huffington found herself lying on the floor of her home office in a pool of blood. After an MRI, a CAT scan, and an ECG, she learned there was no underlying problem–it was exhaustion which had caused her to faint, her head smashing the corner of her desk and cutting her eye. 

The incident prompted her to ask deeper questions about her life of 18-hour workdays, seven days a week. By the time she delivered a commencement speech at Smith College in 2013, she was preaching the gospel of a good night’s sleep and asking graduates to measure their lives by a “third metric“–changing the world for the better–in addition to those timeless standards, money and power.

You’ve heard this sort of thing before. You’ve heard it from Harvard Business School legend Clayton Christensen. You’ve heard it from Simon Sinek (author of Start With Why) and TOMS founder Blake Mycoskie. And you’ve heard it in at least half a dozen TED talks from other authors and notables.

So my first question to leadership expert Bill George, who just released an update to his 2007 classic “Discover Your True North“, was, why bother? How can you persuade any young leader–whose solipsistic workaholism has been the primary factor in her success–that she needs to take a proverbial chill pill? For it often seems as if entrepreneurs have to learn this lesson the hard way–by collapsing, literally or figuratively. And reminders of retaining a moral compass and striving for work-life balance are as old as the bible–though there’s no shortage of TED-talking gurus hawking contemporary versions.

George’s answer was optimistic. He hopes the personal-transformation tales gathered in his book will help young leaders “accelerate that learning curve, and become self-aware earlier in their lives, without hitting the wall,” he tells Inc. The updated book includes stories about Huffington, Mark Zuckerberg, Chade-Meng Tan (who built Google’s employee-meditation program), and many others.

Mind you, George has lived the life and walked the walk himself. While he was CEO of Medtronic, a medical device and technology company, from 1991 to 2001, the company’s market cap grew from $1 billion to $60 billion. He then became a credentialed expert on the subject of leadership, authoring four books and joining the faculty at Harvard Business School. He’s currently a director at ExxonMobil, Goldman Sachs, and the Mayo Clinic.

So what advice can George give to hard-charging entrepreneurs who may be on the verge of hitting the wall? In an interview with Inc., he boiled the answer down to two components:

1. Find a support team of mentors you’ll actually listen to.

George believes Huffington could’ve avoided her collapse if she’d had a close support team around her–“people who could’ve been intimate with her, and told her: ‘Hey, you’re heading for trouble. Let me tell you what I see happening,'” he says.

George cites Zuckerberg as a young CEO who found the right support team–and whose performance has thrived (without hitting a wall) as a result. In 2005, Zuckerberg met Don Graham, CEO of the Washington Post Company. Graham offered to invest $6 million in Facebook. Zuckerberg accepted, only to renege when Accel Partners offered to invest at a higher valuation.

Yet Graham, rather than feeling snubbed, was impressed with how Zuckerberg handled the situation. Later that year, Zuckerberg shadowed Graham for several days to learn how a CEO ought to behave. The relationship deepened. One benefit? Graham advised Zuckerberg to hire COO Sheryl Sandberg and encouraged Sandberg to accept the position, even though she’d be reporting to someone younger. Graham–today the lead director of Facebook’s board–benefited from the relationship too, learning from Zuckerberg about online initiatives that would engage Washington Post readers.

More than this, Zuckerberg’s relationship with Graham formed a template Zuckerberg would rely on in seeking mentorship. Today, his roster of mentors includes Bill Gates and Marc Andreessen. “People always ask, How does [Zuckerberg] have the wisdom of someone 20 years older?” says George. “The answer is, he sought out really good mentors, early on.”

2. Take a break, for at least 20 minutes a day.

No texting. No internet. Just you and your introspective practice. What you do during this time can vary. What matters most is that you’re away from your tasks. “I use meditation,” says George. “Others go for a run or take a long walk. Religious people pray. The point is, they do something where they’re pulling out of the world.”

George says the meditation time has helped him make better decisions. In 1997, under his watch, Medtronic had the chance to complete a $15-billion merger. Many employees had reservations about the deal, anticipating a major culture clash between the other company’s top-down approach and Medtronic’s empowered middle tier of engineers and marketers.

Despite these reservations, the merger was enticing to George, as a way to add to Medtronic’s top-line revenues. “The numbers worked well and the [combined] strategy would’ve been brilliant,” says George. Still, his colleagues and coworkers were warning him about the potential culture clash. “They were expressing concerns to me, and I was not listening as much as I should have,” he says.

George credits his daily mediation practice for giving him the perspective to heed those warnings. “Then I took the time and did listen,” he says. He recognized that while the fiscal and strategic synergies might please merger-drunk investors, the culture clash would ultimately undermine any short-term gains in the stock price. “It took me a while to see that,” he says. “I had to back away.”

The larger lesson here–and another focus of “Discover Your True North”–is value-based leadership: The idea of using not only fiscal numbers, but also a moral compass and a set of personal beliefs to guide your decisions.

The combination of a support team and daily introspection can help you stay mindful about what’s really important in life: Your health. Your loved ones. Their health. Your reputation as an ethical person. Staying out of jail. When those essentials are your true north–and they are reinforced by a support team you’ll listen to–you’ll be unafraid to back away from lucrative deals for the sake of larger principles. “You don’t have to hit the wall or get fired,” says George. “You can learn to pull yourself back, to get back to your true north.”

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This article was originally published 8/17/15 on inc.com.