40 Years in the Business: Leadership in the Beginning
We’re celebrating our 40th anniversary this year, which is quite a feat in our industry. As happens around milestones, it’s caused us to look back and reflect on what we’ve seen, as well as look forward to what’s coming. We decided to put some formality to the process and sat down with each of Vantage’s five Partners to discuss the idea of effective leadership and strategic talent management.
Over the next few weeks, we’ll be sharing a series of articles outlining what we learned. With a collective 100 years of experience as consulting psychologists, Managing Partner Keith Goudy, Founding Partner Carl Robinson, and Partners Mike Tobin, Jacki Ackerman, and Dave Sowinski are a fountain of knowledge. We asked them all to discuss the changes they’ve seen already, and the trends they expect will impact the future. And while each brought their own particular nuance to the conversation, there were some definite themes and trends when it comes to leadership in the past, the present, and the future.
“People are still people,” Carl said at one point. “I don’t think people are fundamentally different, but the environment around them is different.” This quote nicely highlights one key thread throughout our conversations: The contextual impact on leadership has been and will be incredibly important. As Dave explained it, “how I might approach it is: what are the changes in the business [environment] and how is that requiring leaders to lead in different ways?” So, to fully appreciate the changes we’ve seen play out over the last 40 years, and to identify the trajectories that will continue into the future, it’s useful to look at the full context. Let’s start from Vantage’s beginning.
When we opened our doors in 1976 under the name Organizational Psychologists, the landmark management book In Search of Excellence was still 6 years away from being published. Jack Welch wouldn’t take the helm of General Electric for another 5 years. As self-proclaimed “consulting psychologists”, we had to convince companies of our value. Carl explained, “One of the biggest complaints we had when we were called Organizational Psychologists was ‘Why call yourselves psychologists? It terrifies people.’ People would literally say, ‘you’re going to OP to be shrunk.’ We were mystical to our customers. There was nobody on the inside that did what we did. We had a lot of companies that just said, ‘No way. No way.’ But those that let us in, they would just gobble it up.”
That we even existed points to the fact that not only were companies placing value on leadership skills, but also a more nuanced understanding of leadership was developing. “Hiring leaders is always ambiguous,” Keith said. “People are really complicated, and sometimes it isn’t bad to have a psychologist involved in figuring out who you ought to promote or how you ought to develop that person.”
For years, effective leadership was tied so tightly to the relatively straightforward metric of “results” that nothing else mattered. “Do your jobs and you’ll get paid, fail to do your jobs and you’ll get fired. It was a simpler world forty years ago,” Carl said. Dave also talked about how “heavy-handed management styles, [or]the old boys’ club” was beginning to be seen as, if not necessarily less effective, at least not the only way of leading.
“Back in the day, talent was defined more than anything else by the ability to get stuff done,” Carl explained. “The how–that was less relevant. So you’d get things done in a lot of ways including, yelling and screaming, demanding, being autocratic. Authoritative got things done. People jumped. The leader came in and screamed and people acted.” As Jacki put it, “before, you’re hard working, you have a great work ethic, and that used to be a really positive strength. Now, it doesn’t differentiate as much because most people do. It’s almost the price of admission.”
The Context Shifts
The economic context was going through game-changing shifts. “Starting in the 1970s up until the 1980s,” Carl explained, “we were being killed globally in terms of competition by one place–and that was Japan. Anyone that was making anything in America, the Japanese seemed to find a way to make it faster and better. By a lot. They had a different way of treating people, fundamentally different. The basic premise was sort of upside-down-organizations. They equipped employees in many, many places to be more active in problem solving than we did. It takes a different kind of leader to lead that way. Companies started to figure it out and they came to us saying, ‘help us find leaders that think that way.’”
These trends were indicative of a shift in effective leadership approaches: the authoritarian grip of the leader was slipping. As Dave said, businesses were “realizing that that’s not effective. For one, you can’t keep talented people with that kind of management style.” America’s economy went from manufacturing to services, “which is certainly a more people-oriented way to make a living,” said Carl. Research, both anecdotal and academic, was pointing out that there was more to effective leadership than hitting targets. It wasn’t simply the end goal that mattered–profit gained, widgets created, services delivered–but how leaders achieved results that made a big difference to a companies’ performance.
When Mike joined the firm in the early ‘90s, he found that “many of our customers did not practice strategic talent management. They were looking for people that they could put in jobs. The idea of actually taking seriously whether or not these people could help drive the strategic goals of the business and that you could, from an assessment point of view, focus on that–even though it’s a very simple concept, almost elemental, no one was practicing it.”
But that was all changing. Welch’s ascendancy to CEO at GE, and his revolutionary–and at the time “draconian”–system of focusing on top talent while removing the bottom performers was “sowing the seeds of value creation coaching,” as Mike describes it. “The criticality of great talent,” he said, “this understanding of how important talent is,” was rising into focus. And what was meant by “great leadership talent” was undergoing what Carl terms “a fattening up”.
Next week, we’ll look at our partnership team’s musings about effective leadership from the late 1990s through today, and finally (perhaps the most compelling part of it all), we’ll take a look into the future. Subscribe to Vantage Point so you don’t miss a post.