1. ©2000, Michael A. Mische MOR 559 – Strategic Renewal University of Southern California Strategic Leadership The Core Competency for High Performance LECTURE 8 The Core Competency for High Performance LECTURE 8

2. Lecture 8: DESCRIPTION & OVERVIEW This chapter addresses one of the most fascinating aspects related to organizational performance and its ability to succeed at change, strategic leadership. In this lecture, we will discuss why and how leadership represents one of the strategic pillars. Also, we will study various types of leaderships and explore which leadership styles best support high performance and strategic renewal. Some of the key questions addressed in our discussion include: What is the role of leadership as a pillar of strategy and strategic renewal? What are the essential qualities of high-performance leadership? How do leaders lead for strategic change and high performance? In additional, this lecture will present the five essential qualities of leadership and we will discuss how they relate to, and support, strategy formulation. DESCRIPTION & OVERVIEW This chapter addresses one of the most fascinating aspects related to organizational performance and its ability to succeed at change, strategic leadership. In this lecture, we will discuss why and how leadership represents one of the strategic pillars. Also, we will study various types of leaderships and explore which leadership styles best support high performance and strategic renewal. Some of the key questions addressed in our discussion include: What is the role of leadership as a pillar of strategy and strategic renewal? What are the essential qualities of high-performance leadership? How do leaders lead for strategic change and high performance? In additional, this lecture will present the five essential qualities of leadership and we will discuss how they relate to, and support, strategy formulation. KEY LEARNING CONCEPTS Leadership, serving as a catalyst for strategic renewal and strategy formulation, is an essential component of high performance. Leadership, as one of the most human expressions, plays a major role in strategy formulation and organization’s ability to compete. This lecture aims to address several key concepts related to strategic leadership and includes the following learning objectives: Understand the definition and elements of strategic leadership. Understanding how leaderships functions as a strategic pillar and supports strategic renewal. Identifying the five essential qualities of high-performance leadership. Identifying the four major styles or approaches used by high-performance leaders. Establishing the appropriate measurements for leader’s effectiveness and contributions. Additionally, this lecture will present new perspectives on leadership and create an opportunity for a lively discussion forum. KEY LEARNING CONCEPTS Leadership, serving as a catalyst for strategic renewal and strategy formulation, is an essential component of high performance. Leadership, as one of the most human expressions, plays a major role in strategy formulation and organization’s ability to compete. This lecture aims to address several key concepts related to strategic leadership and includes the following learning objectives: Understand the definition and elements of strategic leadership. Understanding how leaderships functions as a strategic pillar and supports strategic renewal. Identifying the five essential qualities of high-performance leadership. Identifying the four major styles or approaches used by high-performance leaders. Establishing the appropriate measurements for leader’s effectiveness and contributions. Additionally, this lecture will present new perspectives on leadership and create an opportunity for a lively discussion forum.

3. Lecture 8: CASES Scott Paper Company (HBS case) GE and jack Welch (article-built case) CASES Scott Paper Company (HBS case) GE and jack Welch (article-built case) CLASS SCHEDULE & AGENDA I.6:00 – 6:15Course Related Q&A Student Concerns General Discussions II.6:15 – 6:30Review of previous material Preview of current week’s material III.6:30 – 7:30Lecture IV.7:30 – 7:45Break V.7:45 – 9:00Lecture & Material/ Topic Discussion VI.8:45 – 9:30Case Examples & Discussions VII.9:30 – 10:00Professor Available for Q&A, Discussion, etc. CLASS SCHEDULE & AGENDA I.6:00 – 6:15Course Related Q&A Student Concerns General Discussions II.6:15 – 6:30Review of previous material Preview of current week’s material III.6:30 – 7:30Lecture IV.7:30 – 7:45Break V.7:45 – 9:00Lecture & Material/ Topic Discussion VI.8:45 – 9:30Case Examples & Discussions VII.9:30 – 10:00Professor Available for Q&A, Discussion, etc. READINGS Mische: Strategic Renewal, Chapter 8 Munk: “How Levi’s Trashed a Great American Brand,” Fortune, April 12, 1999. Stewart: “See Jack. See Jack Run Europe.” Fortune, September 27, 1999. Colvin: “The Ultimate Manager,” Fortune, November 22, 1999. Murray: “Last Conglomerate,” The Wall Street Journal, April 13, 2000. Scott Paper Company (HBS) – 9-296-048. READINGS Mische: Strategic Renewal, Chapter 8 Munk: “How Levi’s Trashed a Great American Brand,” Fortune, April 12, 1999. Stewart: “See Jack. See Jack Run Europe.” Fortune, September 27, 1999. Colvin: “The Ultimate Manager,” Fortune, November 22, 1999. Murray: “Last Conglomerate,” The Wall Street Journal, April 13, 2000. Scott Paper Company (HBS) – 9-296-048.

4. Lecture 8: CONCEPT DISCUSSION & QUESTIONS 1.What actions and behaviors of the leaders demonstrate the ability to craft strategies and visions that will enable the organization to achieve high performance and successful strategic renewal? 2.Think of several real-life examples of companies and organizations and apply the following questions to their leaders and leadership teams: What projects, initiatives, or results indicate that the leader is effective in a global environment? What insights, perspectives and tactics has the leader developed that demonstrate his/her ability to help advance and perpetuate the organization, while sustaining growth and improving performance? What are the key leadership characteristics, traits and styles of the given leader that are particularly effective in the corporate environment and contribute to his/her successful performance as a strategic leader? What special initiatives, programs or projects demonstrate that the leader is a proponent and a catalyst of innovation and change as a source of competitive advantage? CONCEPT DISCUSSION & QUESTIONS 1.What actions and behaviors of the leaders demonstrate the ability to craft strategies and visions that will enable the organization to achieve high performance and successful strategic renewal? 2.Think of several real-life examples of companies and organizations and apply the following questions to their leaders and leadership teams: What projects, initiatives, or results indicate that the leader is effective in a global environment? What insights, perspectives and tactics has the leader developed that demonstrate his/her ability to help advance and perpetuate the organization, while sustaining growth and improving performance? What are the key leadership characteristics, traits and styles of the given leader that are particularly effective in the corporate environment and contribute to his/her successful performance as a strategic leader? What special initiatives, programs or projects demonstrate that the leader is a proponent and a catalyst of innovation and change as a source of competitive advantage? CASE DISCUSSION & QUESTIONS Current material available at http://www-rcf.usc.edu/~mische (September 2000)http://www-rcf.usc.edu/~mische Interactive class discussion CASE DISCUSSION & QUESTIONS Current material available at http://www-rcf.usc.edu/~mische (September 2000)http://www-rcf.usc.edu/~mische Interactive class discussion

5. Lecture 8: LECTURE SUMMARY High-performance leaders are professionally and personally committed to the ideals, the visions and the purpose that they set for their organizations. They recognize that the primary mission id to advance the organization as opposed to their personal interests and legacies. The key messages resulting from this lecture are: High-performance leaders have a great knowledge and sense of self and develop their character. High-performance leaders understand their environments and impact on others. They understand the sources of their leadership, which include relationships, coalitions, and collaborations. High-performance leaders demonstrate personal commitment and conviction through their sincere actions, consistency in behaviors, communications and through respecting and attending to others. High-performance leaders are capable of making difficult decisions. They apply all-inclusive approach to discussions, encourage debates, but assume full responsibility for final decisions. LECTURE SUMMARY High-performance leaders are professionally and personally committed to the ideals, the visions and the purpose that they set for their organizations. They recognize that the primary mission id to advance the organization as opposed to their personal interests and legacies. The key messages resulting from this lecture are: High-performance leaders have a great knowledge and sense of self and develop their character. High-performance leaders understand their environments and impact on others. They understand the sources of their leadership, which include relationships, coalitions, and collaborations. High-performance leaders demonstrate personal commitment and conviction through their sincere actions, consistency in behaviors, communications and through respecting and attending to others. High-performance leaders are capable of making difficult decisions. They apply all-inclusive approach to discussions, encourage debates, but assume full responsibility for final decisions. CLASS & INDIVIDUAL ASSIGNMENTS Current material available at http://www- rcf.usc.edu/~mische (September 2000)http://www- rcf.usc.edu/~mische CLASS & INDIVIDUAL ASSIGNMENTS Current material available at http://www- rcf.usc.edu/~mische (September 2000)http://www- rcf.usc.edu/~mische SUPPLEMENTAL MATERIAL Current material available at http://www- rcf.usc.edu/~mische (September 2000)http://www- rcf.usc.edu/~mische SUPPLEMENTAL MATERIAL Current material available at http://www- rcf.usc.edu/~mische (September 2000)http://www- rcf.usc.edu/~mische

6. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische On Leadership… by Great Leaders “Leadership is the art of getting someone else to do something you want done because he wants to do it.” Dwight David Eisenhower, 34 th president of the United States “I learned that a great leader is a man who has the ability to get other people to do what they don’t want to do.” Harry S. Truman, 33 th president of the United States

7. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Leadership As a Strategic Pillar of High Performance: Fundamental Questions… I.What is the role of leadership as a pillar of strategy and strategic renewal? II.What are the essential qualities of high performance leadership? III.How do leaders lead for strategic change and high performance?

8. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische DEFINING CONTEMPORARY STRATEGIC LEADERSHIP

9. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische All these approaches provide some insight into leadership and the development of leaders, but don’t offer a definitive direction as to HIGH-PERFORMANCE LEADERSHIP. What Makes a Great Leader… A Common Focus of Research  Biographical approaches analyze backgrounds, personal development, life-long influences and interests, and seek for common traits and qualities.  Genetic analyses search for biological patterns common to leaders (a genetic component or a learned quality?).  Environmental influences studies focus on external factors and determinants to provide answers as to leadership capabilities and skills. Critical Observations:

10. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Traditional vs. Contemporary Leadership Traits  Compliance  Authoritative  Heroic/Center of attention  Aloof/Insulated  Delegator/Hierarchical  Deep specialty skills in traditional areas  Extensive industry knowledge  Long-term company tenure  High control & command  Domestic orientation  Creates consensus  Intimate knowledge of the organization  Innovator  Assimilator/learner  Shares power & attention  Approachable & accessible  Conductor/network builder/ leverager  Generalist with subject matter expertise in several areas  Experience in several industries  Portfolio of diverse knowledge  Empowerment & sponsorship  Global perspective  Creates coalitions & sponsors collaboration  Intimate knowledge of the customer

11. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische The Source of Leaders: Traditional vs. Temporary Approaches… Traditional Methods/Sources:  Internal development  Perpetuation of organization- specific, historical qualities, behaviors and experiences  Stress technical prowess  Focus on short-term needs  Limited linkage to long-term strategic initiatives  Emphasize limited skill set with deep expertise in a single area Traditional Methods/Sources:  Internal development  Perpetuation of organization- specific, historical qualities, behaviors and experiences  Stress technical prowess  Focus on short-term needs  Limited linkage to long-term strategic initiatives  Emphasize limited skill set with deep expertise in a single area Temporary Methods/Sources:  Increasing number of leaders developed outside an organization  More emphasis on professional diversification: – Different jobs and positions – Geographical diversification – Multiple cultural experiences and perspectives  Broad referential base/portfolio of problems, professional situations and experiences Temporary Methods/Sources:  Increasing number of leaders developed outside an organization  More emphasis on professional diversification: – Different jobs and positions – Geographical diversification – Multiple cultural experiences and perspectives  Broad referential base/portfolio of problems, professional situations and experiences Changing competitive dynamics, increasing interconnectivity, complexity and velocity of change are making traditional leadership training & development obsolete and ineffective.

12. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische What Is Strategic Leadership… In one form or another, leadership is an essential core competency for strategy and strategic renewal. Leadership must be: – Accountable – Responsible – Approachable – Systemic (present at multiple organizational levels)

13. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Defining Strategic Leadership… “Art or process of getting others to think, act, and to do extraordinary things through their own belief, and often at their own initiative, risk and device.” Mische: Strategic Renewal

14. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Defining Strategic Vision for High-Performance Leadership…  Must be a guiding force, aligned with the organizational resources, goals & strategy  Must offer a compelling value proposition  Must be appealing and clearly articulated/presented to the followers  Can be established at all organizational levels by different types of leaders  Is defined as: “A representation of the purpose and desired future state that guides and motivates the organization.” Mische: Strategic Renewal  Consider leaders such as Dr. Martin Luther King, Bill Gates, Mahatma Gandhi, Betty Friedan, etc.

15. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische ESSENTIAL QUALITIES OF STRATEGIC LEADERSHIP

16. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische “Leaders do not have to fit a particular mold.” Barry Patmore – Organizations using narrow definitions of leadership, a prescriptive set of quantitative measures, or a highly subjective criteria often preclude creative and innovative leaders. – “Different” leaders will be indispensable in the future, given the rising velocity of change, ever altering conditions, and increasingly unpredictable and uncertain environment. – Successful leaders and their styles will be different; nevertheless, all high-performance leaders will share five essential qualities…

17. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische The Five Essential Qualities of High- Performance Leadership Passion To Lead Perspective & Insight Sense of Self Confidence, Courage & Conviction Character & Integrity

18. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische The Five Essential Qualities of High- Performance Leadership, cont’d… 1.Character & Integrity 2.Sense of Self – Emotional Intelligence & Social Skills – Respect & Empathy for Others 3.Passion to Lead – Well-defined Vision – Sense of Purpose & Mission for the Organization 4.Perspective & Insight – Communication Skills 5.Confidence, Courage & Conviction – Decision-making & Judgment

19. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Character: The Nucleus of Leadership  The ultimate source of leadership & the most important quality imperative to a leader  Creates authenticity & credibility  Supplies moral basis & authority  Defines who we are as human beings: “Character distinguishes us as unique and different individuals and reflects our beliefs and perspectives. The development of character is both genetic as well as a life- long process of learning, adapting, value-assessment and decision-making… it embodies trust, sincerity, honesty and integrity.”

20. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Character vs. Behavior & Style  Character: – Leaders can choose to manifest their character through different behaviors and behavioral styles according to the situation and respective appropriateness; yet their character always remains singular and constant.  Behavior & Styles: – Democratic leader – Consensus leader – Autocratic leader – Charismatic leader – Tyrant, etc.

21. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Sense of Self… “Until we know what motivates the hearts and minds of men we can understand nothing outside ourselves, nor will we ever reach fulfillment as that greatest miracle of all, the human being.” Marya Mannes “Until we know what motivates the hearts and minds of men we can understand nothing outside ourselves, nor will we ever reach fulfillment as that greatest miracle of all, the human being.” Marya Mannes “Leaders who have a highly developed sense of self and are intimate with their emotions are better able to forge more meaningful and synergistic relationships with others. Mische: Strategic Renewal “Leaders who have a highly developed sense of self and are intimate with their emotions are better able to forge more meaningful and synergistic relationships with others. Mische: Strategic Renewal

22. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Sense of Self… … is an essential characteristic of great leaders and requires the development of several qualities, including: – A deep understanding of personal strengths and weaknesses – Surround herself with talented and energetic people, while not being/feeling threatened by their qualification and capabilities – Understand the forces shaping people’s character, behavioral patterns as well as motivating elements – Acknowledge people’s fears and sources of insecurity – Confidence in their knowledge of value systems, standards of morality and ethics – Cultivating of self-confidence and empowerment in others

23. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Sense of Self, cont’d… High-performance leaders are able to function in an extremely unique state of focus, in which they: – Are conscious of their emotions and state of mind at the moment – Draw simultaneously on intuition, feelings, education, formal training to process information, interpret communications and interact with others – Neutralized their emotions in an attempt to perform at higher levels

24. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Passion To Lead…  Demonstrates strong personal commitment to the organization on behalf of the leader  Induces trust, credibility and presents a motivating force for employees  Accompanies a sense of purpose and urges organizational agility  Drives a leader’s vision and mission designed for the organization  Enables high-performance leaders to translate their visions into action-oriented strategies that present a distinct economic, societal and competitive value proposition to involved stakeholders

25. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Perspective & Insight…  The ability to identify, analyze, interpret and simplify technically complex or politically charged issues and solutions using a multi-disciplined approach, leading to: – Innovative perspectives & answers – Unique approaches and solutions – New standards & assessing criteria  Requires a great awareness and understanding of reality, environmental dynamics and faced situations as well as a thorough knowledge of the organization  Demands the ability to function under uncertainty and to make decision facing high levels of ambiguity and complexity

26. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Perspective & Insight: Common Qualities of Great Leaders…  Developed sensitivity & appreciation for life due to their diverse life experiences  Their personal growth usually involves parenting, care giving, volunteering, etc.  Have overcome significant adversities and challenges in their personal lives  Have a successful portfolio of jobs, employers, and easily transitioned between locations  Share multiple outside interests expanding their social networks

27. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Perspective & Insight, cont’d…  Leaders use a variety of forums and methods to communicate their perspectives, visions and organizational strategies. There are four basic purposes/objectives while communicating: 1.To Teach 2.To Inform 3.To Solicit 4.To Direct

28. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Leadership Communications… Behavior Influence Needs and Motivations Message Objective and Content Desired Results Solicit Direct Educate Inform Audience New Behaviors Needs Themes Higher Performance Message

29. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Confidence, Courage & Conviction…  Sources of personal strength  Inspire follower to commit and take action  Necessary for decision-making and assuming full accountability/responsibility “If you want to lead you must have confidence in yourself, but more importantly, you must learn to have the same confidence in others.”

30. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische LEADERSHIP BEHAVIOR & STRATEGIES FOR HIGH PERFORMANCE

31. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Leading for High-Performance Results: The Ways In Which Leaders Lead  Conductor/Choreographer  “Stage managing & creative guidance”  Leaders are influencers, guides, catalysts, coaches & teachers  Capability to best utilize & deploy resources  Appreciation for multiple competencies & diversified experiences  Coalition & Collaboration Builder  Recognize the benefits & opportunities of multiple talents, competencies, perspectives  Appreciate and encourage innovation, operational excellence and knowledge as a resource for competitive advantage

32. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Leading for High-Performance Results: The Ways In Which Leaders Lead, cont’d…  Change Agent/Catalyst  Recognize and encourage organizational agility  Effectively eliminate boundaries between competencies, functions and structures  Achieve appropriate alignment of strategies, processes, structures & resources  Establish business and social architecture – open & adaptable climate for better (high) performance  Champion of Operational Excellence  Accomplish effective utilization of knowledge  Continuously challenge their organization internally (set extraordinary performance levels, establish measurements & recognition systems) & establish a sense of urgency  Demand constant state of learning, discovery & innovation  Create multicultural, diverse & “mutlicapable” social architecture

33. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische LEADER DEVELOPMENT: SKILLS & KEY QUALITIES

34. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Developing Effective Leaders: Issues to Address… 1.How to identify emerging leaders. 2.How to select leaders for development. 3.How to develop leaders  Models and frameworks for leader development  Career progression

35. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Key Qualities and Indicators of Leader’s Potential & Effectiveness… Knowledge Emotional Intelligence Socials Skills Asses environmental changes & trends Gain respect from followers Effective interpersonal dialogues

36. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische High-Performance Leaders… Common Traits  High-performance leaders are consummate learners and synthesizers.  They are enormously adaptive in their views of the world, external environments, personal lives, working styles and leadership behaviors.  They aggressively seek ways of “fitting in”.  They are explorers and pioneers.  They are extraordinarily flexible.  They are confident and committed.  They have extraordinary character.

37. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Developing the Skills for Effective Leadership… Unique Natural Abilities Careful Cultivation Formal Development Opportunity to Lead Dedication to Life-long Learning & Commitment to Being a Better Leader

38. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische The Five-Step Process for the Progression of Leaders…  This model presents an overlapping, continuous set of activities which represent a progressive process of learning and development: 1.Selection 2.Development 3.Assessment 4.Advancement 5.Placement

39. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Assessing Leader Effectiveness: Top Five Lessons… 1.Assessment is both subjective and objective. 2.Assessment requires balance and diversified criteria. 3.Use an Inclusive Evaluative Approach. 4.Ensure link to strategies, plans and initiatives. 5.Concentrate on little things and great performance and financial results will follow.

40. Strategic Renewal Strategic Leadership MOR 559 – Strategic Renewal University of Southern California ©2000, Michael A. Mische Key Lessons for Exemplary Leaders… 1.It takes a different type of person to be a high- performance leader. 2.High-performance leaders create synergies of purpose. 3.They recognize changes and contrasts in the environment. 4.High-performance leaders view the resources and capabilities of their organizations as single integrated capabilities. 5.They view their markets as parts of a single, integrated worldwide environment.