The Mind-Set of the Business Leader


When people are selected to run a business, it’s the culmination of years of learning and sacrifice. In many instances, it’s the fulfillment of a dream. Most executives have sacrificed time with their families, gone through periods when work was a seven-day-a-week proposition, and made some very tough decisions about jobs and people. When they’re named general managers or division presidents, they’ve reached what many of them have thought of as a capstone position. As a business head, they have tremendous autonomy and authority. For the first time, they get to call the shots. Though they have a corporate boss, this individual generally gives them plenty of leeway. In certain instances, heads of businesses become community leaders. When these businesses are located in smaller towns or foreign countries, GMs may become local dignitaries—ambassadors representing all of General Motors, IBM, Ford, or the Bank of America. They’re treated with tremendous respect (and sometimes subservience) by people in the community and invited to sit on local boards and participate in civic decision making.

We worked with a top executive with a large corporation who was appointed to a country manager position in China. As part of the appointment, he lived in a mansion, was called upon by diplomats, and attended fabulous parties. At the end of his successful tenure, he was transferred to a staff position in Milwaukee, where both he and his wife suffered significant re-entry shock. It wasn’t the staff job that was a problem, but the loss of the prestige, perks, and autonomy of being a country head was hard to exchange for what they perceived as a boring life in an American city.

Although most leaders enjoy the GM position more than any they’ve ever had (and often more than any other they will have), there’s a cost. Specifically, the profit-and-loss responsibility is a big change from their past positions, when they were primarily responsible for decision making that was removed from P&L tradeoffs. Just as significantly, they’re moving from running a “partial” business as a functional leader to running one in its totality. As we’ve discussed, this means moving from a monofunctional to a multifunctional perspective. It means selecting people for their team, creating a culture, and being a ceremonial as well as a practical head of business. It also involves creating external as well as internal relationships. Functional managers generally aren’t concerned with forging relationships with regulatory bodies, community groups, and other external entities.

Not only is there a great deal of knowledge and skill to acquire, but GMs must also acquire a distinctive mind-set. They need to value their people and their development much more than they did as functional managers. They must become accustomed to seeing more broadly and thinking bigger than they did within a singular function. They have to become comfortable dealing with a range of people, including a hostile reporter one minute and a competitive threat to the business a minute later. Perhaps even more challenging is the loneliness that some of our clients report. Some general managers are surprised to discover how truly alone they are for the first time in their business lives. Up until this point, they were part of a team. There was always someone to confide in and work with on an equal basis. As the cliché goes, “the buck stops here.” They are singularly accountable for the business. They are the ones who are judged by the financial scorecard. Unlike their previous positions, they can’t complain to or about their boss, at least not in the way they may have done in the past. Their boss is not a constant presence but rather a distant observer, representing a very different way of managing upwards.

GMs are jugglers, and this is probably the first sustained juggling act they’ve ever performed in public. Earlier in their careers, they could focus on specific tasks and goals. Even if they did different things, their responsibilities were limited by their jobs. A business head, however, is responsible for everything. This is a psychological shift leaders need to make. They must accept that they’re going to be jumping from one area to the next, and they won’t have time for everything. It’s magical the way good GMs keep all the balls moving, but it’s also a bit overwhelming to think about sustaining such a performance.

Finally, most GMs enter their jobs assuming they’ve been well prepared for their new responsibilities. Certainly, they’ve been prepared in one sense of the term. Most MBA programs review the requirements and tasks of the GM, and they provide students with a good concept of the skills the job requires.

A functional manager position, too, provides people with experience in different areas that may be useful when they run a business, but in coaching and teaching hundreds of GMs, we have come to believe that leading a functional area may not be a particularly good training ground for the GM position. Though most companies route their best people from functional roles to heads of business, this isn’t ideal preparation for the passage.

First of all, be yourself. Be attentive. Don’t shirk on your career. Care for your consumers. Care for your company. I’ve seen so many people being obsessed about their own career that they have forgotten how to make the difficult decisions. To really get diversity of experiences you have to rotate into different functions, different countries, corporate operating units. Only then can they compliment themselves on their strong leadership.

Thomas Ebeling, CEO, Novartis Pharmaceutical

Our colleague, Ram Charan, has suggested that the best way to prepare someone for being a business head is to give him “little” GM jobs, such as letting someone run a smaller business, as in our example of how GE used smaller businesses to minimize the risk in training future GMs. Charan has also noted that running small but complex, interdependent businesses such as a teenager’s lawn-mowing business (marketing, payroll, revenue generation are all required) may be the best early training for a future GM. Excellent GMs learn to make tradeoffs, and this requires focusing on multiple priorities simultaneously, continually shifting attention and emphasis, and making decisions with a full view of how one decision might affect other alternatives.




Leadership Passages. The Personal and Professional Transitions That Make or Break a Leader
Leadership Passages: The Personal and Professional Transitions That Make or Break a Leader (J-B US non-Franchise Leadership)
ISBN: 0787974277
EAN: 2147483647
Year: 2003
Pages: 121

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