What does George know about leading in crisis that makes him an expert on the subject? It turns out quite a bit. As Medtronic CEO, George earned a reputation for managing with integrity and challenging people to think creatively when dealing with crises. That approach helped establish Medtronic as the world’s leading medical technology company that experienced explosive growth of nearly 35% per year. In addition, as a member of the Goldman Sachs Board of Directors, George had a front-row seat as the recent financial crisis rocked the world.

George’s lessons include: Face Reality, Starting with Yourself; Never Waste a Good Crisis; and Be Aggressive: This is Your Best Chance to Win in the Market. In addition to providing practical advice, George shares real-life stories, anecdotes and a wealth of wisdom for current and aspiring leaders. He says the natural reaction when facing a crisis is to “hunker down,” batten down the hatches and ride out the crisis.

Rather than running for cover, George believes every crisis provides an opportunity to emerge as a stronger, more vibrant company or individual on the other side.

“Winners are not those who just get through it. You do have to get through it, but the winners are those who figure out how we can position the opportunity to make our company a lot stronger,” he says. “In Chinese, ‘crisis’ is made up of two characters: Danger and Opportunity. We all know ‘danger,’ but winners find the ‘opportunity.’”

During difficult times, employees look to leaders to fill-in-the-blanks with answers and reassurance. George advises leaders to take a team approach to solving problems.

“Don’t be Atlas, get the world off your shoulders,” he says. “Do two things — bring your teammates in your organization ‘real close around you to get the very best minds and best energy you can addressing the problems’ and ‘get everyone committed to solving them with you’ while getting to the real root causes of the problems.”

Beyond that, George urges leaders to establish an external support network — a person or group of people they can be totally open with and to bring perspective to a situation. It isn’t a secret that crises are the true test of leaders. And George believes most effective leaders don’t wait until they’re in charge to learn how to deal with crises. George says he has seen a number of leaders fail because they didn’t have prior experience in leading a crisis.

Overall, the key quality of good leaders is adaptability. George says his experiences, and the experiences of others, have proven to him, that you have to be in the game to learn.

“The worst decision I ever made is the one I didn’t make,” he shares. “A crisis is a real test of a leader’s courage. Leaders who aren’t willing to take a risk, that don’t have the courage, will surely fail.”

For more information, please visit www.billgeorge.org for videos, and activities. Also, look for the study guide in the back of the book. It’s a great tool for small groups to use in working through the lessons together.

Article By Paul J. Welsh

As a result, books about the great leadership successes draw us like magnets. But Tim Irwin, Ph.D., looks at the discussion of leadership from the opposite perspective—leadership failures. That’s what makes “DERAILED: Five Lessons Learned from Catastrophic Failures of Leadership” such a compelling book.

Irwin examines the collapse of some of the biggest names in business: Robert Nardelli at Home Depot; Carly Fiorina at Hewlett-Packard; Durk Jager at Procter & Gamble; Steven Heyer at Starwood Hotels & Resorts & Worldwide; Frank Raines at Fannie Mae; and Dick “Richard” Fuld at Lehman Brothers.

Irwin points out that these are people who have been very successful but ultimately were fired by their boards of directors.

As he writes in this book, “Derailment and lack of success are different.”

Irwin suggests that there are similarities in the reasons why all those leaders were ousted. In none of these cases was fraud involved. As leaders, Irwin says we should look at these similarities in evaluating our own performances. In truth, this book is as much about us as the leaders profiled he says.

The five lessons identified in the book are:
1. Character Trumps Competence
2. Arrogance is the Mother of All Derailers
3. Lack of Self-Awareness is a Common Denominator of All Derailments
4. We are Always Who We Are, Especially Under Stress
5. Derailment is Not Inevitable, but without Attention to Development, it is Probable.

The first lesson, “Character Trumps Competence” is a challenging statement that really touches all of the others at some level. “Character” as Irwin describes it is not stealing money or sleeping with your executive assistant. It is about things like authenticity. Irwin says the reason authenticity is so important is that in repetitive research we learn that people want a leader they can trust. And if you can’t get people to follow you, by definition you’re not a leader.

Other aspects of “character” are related to things that are lacking– lack of self-management, humility and courage.

Behaviors that derail “self management” include being easily angered, undisciplined and inflexible. In the case of “humility” the behaviors causing derailment include arrogance, self-promotion and dismissiveness. Finally, with regard to “courage,” those derailing behaviors include conflict avoidance, micromanagement and an excessive need for approval.

Even before reading this book, you can find free personal risk assessment tool at www.DerailedLeader.com and it’s worth a visit.

Article By Paul J. Welsh

Well I’ve got this guy I want you to meet. His name is George Cloutier. He’s a Harvard grad that Business Week dubbed a “Turnaround Ace” and his focus has always been on small business. Actually, you may not even need to hire him, just read his book.

His national best-selling book is called Profits Aren’t Everything, They’re the Only Thing. The book includes “The 15 Rules” that George Cloutier’s consulting firm has used to turn small businesses on life support into profit-making machines. His success with helping small businesses is immense.  In fact, in the first chapter of the book he talks about how his firm has helped more than 6,000 businesses in 300 industries. His company has identified more than $1 billion in additional profits for those clients.

So why wouldn’t every small business want to hire Mr. Cloutier’s consulting firm and get their share of the $1 billion in extra profits? Good question.  The answer is that these kinds of profits come with a price.

For example the book suggests that you should work seven days a week, never pay vendors on time and give up golf.  Are you ready to make those commitments or do they make you feel like maybe profits aren’t everything?

If these measures sound extreme, they are. Cloutier says you only have to make the hard choices if you want to be successful in business. If you want to have life balance, start a non-profit he adds.

The majority of Cloutier’s clients are family businesses. And two of his 15 Rules are specific to them: Love Your Business More Than Your Family and The Best Family Business Has One Member.  As harsh as that seems, Cloutier says too many family businesses mix family issues into the business and in the majority of situations they fail. The first of those rules states, “Your cell phone is for taking orders from clients NOT grocery lists. Weekends are for work. Pray at your desk if you must. Your business is not a part-time job. Be there or be broke.”

There is no doubt that much of Cloutier‘s advice is challenging and even scary.  Still, the book is both entertaining and thought provoking.

George Cloutier, a magna cum laude graduate of Harvard College and Harvard Business School, founded American Management Services in 1986. The company’s web address is www.amserv.com

Article By Paul J. Welsh

Interview was conducted by Jay Liebenguth

Deer Creek Tower - Suites and Services

Even during the best of times, small businesses in America represent the majority of all new U.S. job growth.  In fact according to the Small Business Administration, most net job loss occurs within firms that are greater than 500 employees.

In a recent Fox News Sunday interview, Steve Odland, Chairman and CEO Office Depot, told host Chris Wallace that, “All net job creation happens in small business.”  This is at least in part because many of the largest U.S. corporations have matured.  Prior to last year’s recession, job growth at many major corporations had slowed or evaporated in corporate America.

Over the past year, the slow churn of persons leaving larger companies to become entrepreneurs, or to go to work for smaller organizations, has grown from a steady stream to an avalanche.

The reality is, the ranks of the temporarily unemployed are growing.  These days, temporary unemployment all too often is turning into long-term unemployment or underemployment.

Is our glass half full or half empty?   The reality, I guess, is both.

Just when you begin to bemoan the present employment situation, your thoughts are illuminated by the present spark of American innovation and entrepreneurship.

A recent article in Wired magazine titled, “Go Ahead….Fire Me,” stated that after experiencing layoffs, most able bodied American workers will always be able to take their skills elsewhere.  It is a recession’s way of leveling the playing field.

With stock dividends, the companies with less new growth opportunities and fewer new ideas must purge capital in the form of (theoretically) ever growing dividends.  The companies with greater sources of new business ideas and planned new business growth are capital hungry, and retain their dividends to invest in the new ideas.

With people, it’s the same.   Companies who cannot, or should not afford to retain the best and the brightest, naturally lose them to better, more fulfilling opportunities elsewhere.

See the quote below.  And, while it is dated, I still believe it today.  Yes, a lot has changed it was written.  At that time, unemployment was likely hovering below five percent.  It’s twice that today.

Yet, the best people will still be seen inside the best companies, even if the companies have only a few employees.  It’s the American way.  It’s the American dream.  And, at this point, it’s the American reality.

Thoughts for the Day

“Five years from now, you will look around and realize that the best employees can be found working for the companies who were paying the most attention.”

Dave E. Anderson

Alpha Scouts^™ LLC

July 15, 2005