In Real Leaders Don't Follow, author Steve Tobak explains how real entrepreneurs can start, build, and run successful companies in highly competitive global markets. He provides unique insights from an insider perspective to help you make better-informed business and leadership decisions. In this edited excerpt, Tobak offers his take on four different ways to successfully lead your business.
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If you’re inspired by your work, if you’re engaged and motivated to do great things, and if you have certain business basics covered, you’ll have no trouble inspiring, engaging, and motivating others. But exactly what kind of leader will you be?
Let’s figure that out by looking at the leadership styles of some of our most successful CEOs.
The Bill Gates School of Leadership
It goes without saying that Bill Gates is a brilliant technologist and businessman. But during his more than two decades at the helm of Microsoft, he was a ruthless and predatory competitor and was often confrontational, petulant, and verbally abusive.
And yet this man built a company that boasts 1.5 billion users, created more than 10,000 millionaires, and always ranks among the top companies to work for. After leaving Microsoft, Gates has since dedicated his life and much of his fortune to enhance health care, reduce poverty, and improve education around the world by creating the largest private foundation in history?
The thing is, leadership comes in all shapes and sizes. And your particular style, strengths, weaknesses, emotional intelligence, and personality traits don’t necessarily factor into the picture exactly as you’d expect. To that extent, leadership is a lot like physical appearance. People may look beautiful or striking, but upon closer examination, they don’t usually have perfect noses, eyes, mouths, or bodies. It’s how it all goes together that matters.
Beauty isn’t skin deep. Neither is leadership.
The Warren Buffett School of Leadership
According to his 2014 Wall Street Journal op-ed, when Bill Gates asked Berkshire Hathaway chairman Warren Buffett to recommend his favorite business book, Buffett named a book that had been written 20 years before, Business Adventures by John Brooks. Since it was out of print, Buffett sent Gates his copy, which Gates apparently still has.
As Gates said in the article, “Brooks’s work is a great reminder that the rules for running a strong business and creating value haven’t changed. For one thing, there’s an essential human factor in every business endeavor.” He says the book has stood the test of time because it’s as much about human nature -- how leaders react to challenging circumstances -- as it is about specific businesses.
Indeed, had Gates and Buffett concerned themselves with amorphous concepts like leadership abilities when they were young instead of building and growing their companies, they would not be among the richest and most successful entrepreneurs in the world. They became great leaders over decades through the experience of building their companies one day at a time.
Leaders are not born, proclaimed, or entitled. CEOs don’t just fall out of the sky into cushy corner office chairs. They're the product of an extraordinarily complex combination of internal and external factors, chains of events, circumstances, and experience.
If you want to become a great leader, the best way to accomplish that is by following your passion, being true to yourself, creating great products, hiring the best talent, and building a successful business that values its employees and customers. If you want to learn how to be a great leader, start by learning how to build a great business. The rest will follow as you mature and gain experience.
The Andy Grove School of Leadership
Former Intel CEO Andy Grove’s unique management style, as I came to understand it, has greatly informed my own methods and thinking on the subject of leadership. Grove was a big fan of constructive conflict. In his book High Output Management, he provides a diagram of the ideal decision-making process. It starts with “free discussion,” then “clear decision,” and finally “full support.” If the decision turns out to be wrong, the process repeats.
Here’s how I view that decision-making process: Everything is on the table. Everyone tells it like it is. It’s not enough to simply encourage everyone to be completely open and honest; it’s a requirement to achieve optimum outcomes.
Participants leave their personal agendas at the door. There’s no place for those who sugarcoat the truth or cover their asses. Sugarcoating, political correctness, and the status quo are all enemies of an effective decision-making process. If you want to determine the best course of action, figure out how best to achieve the goals of the company.
Once a clear decision is reached -- either by consensus or, if necessary, by the responsible executive -- then it’s documented and everyone commits full support to the decision. If your side loses the debate, you still have to disagree and commit, meaning everyone’s on the same page from that point forth until the plan succeeds or fails.
The process generates outcomes with the best chance of success given the information and expertise at hand. It also creates an aligned high-performance management team that works together to execute agreed-upon strategies and achieve common goals.
Grove’s management (I doubt he’s fond of the term leadership -- too amorphous) style -- which is still evident in the way Intel operates today -- created a highly flexible culture that adapts rapidly to changing market conditions. It’s also surprisingly resilient to scale. At times I’ve seen Intel move and pivot as rapidly as a startup.
Encouraging constructive conflict during decision making goes a long way toward eliminating the destructive effects of conflict, not to mention the insidious results of groupthink and corporate inertia.
The Knights of the Round Table School of Leadership
One of the trickier concepts for any CEO or business leader involves delegation and authority. When a business transitions to more than one level of management, decision making can get much more complicated. While it’s best to have clear lines of responsibility, so your lieutenants have authority over their functional areas, you also want to encourage their peers to voice opinions that carry some weight. After all, functions overlap, and you want your leadership team to be aligned.
Consider the Knights of the Round Table as a leadership team model. Everyone has an equal voice and is encouraged to express their opinion on all matters, whether it’s in their area of functional responsibility or not. The only difference is that the functional executive always gets to make the final call.
The process works because of peer pressure. If marketing comes up with product features that engineering can’t design or sales can’t sell, they should openly call them on it. It’s hard for a marketing head to override their peers without a compelling argument. And since they’re all encouraged to get everything on the table and hash it out, marketing will usually end up making the right call -- or pay the price for failing.
In other words, as long as you have the right managers in place and you’ve organized your leadership team so they’re aligned with the company’s goals, you should get out of the way and let them do their jobs. When that’s not working, listen to what everyone has to say, but trust your own instincts when making the final decision.