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Throughout history, people have looked to leaders for guidance and direction. From tribes in the Amazon, to priests in the Vatican, hierarchies naturally evolve with a leader at the top. It may be the most difficult social skill to master, but great leadership inspires teams to achieve more than anyone thinks possible.

Consider the example of King Leonidas of Sparta. In 480 BC, he led 300 Spartans against the massive invading army of Xerxes I of Persia1. The Spartans chose to make their last stand at Thermopylae, where the narrow pass neutralized the Persian numbers. Morale was high despite the overwhelming odds. When told that Persian arrows would blot out the sun, a Spartan soldier named Dienekes scoffed, “So much the better; we shall fight in the shade.”

In the first 2 days of fighting, the Spartans killed 20,000 enemy troops, and only lost a few of their own2. On the third day, they were betrayed by a shepherd. He showed the Persians a secret trail, and they snuck up behind the Spartans. The Spartans were cut down to the last man. But their heroic exploits inspired the remaining Greek city states to defeat the Persians at the Battles of Salamis and Plataea. It was a turning point in the history of Western Civilization—democracy triumphed over tyranny.
Profile of a Leader
What separates foot soldiers from leaders like Leonidas? It’s difficult to generalize because different styles are effective in different situations. However, 80 years of leadership research have identified three consistent themes: Image, Relationships, and Decisions3.

Image means that leaders must be perceived as leaders. They must be seen as honest, trustworthy, and loyal to the team’s beliefs and values. Leaders often take great risks or make large personal sacrifices to demonstrate loyalty to the cause. By demonstrating superior skills and competence, leaders inspire confidence that they will guide the team in the right direction.

In relationships with the team, leaders strike a balance between support and structure. For tedious or unpleasant tasks, leaders motivate the team by providing psychological and emotional support. When a task is complicated, or the team lacks experience, leaders provide structured tasks and goals, and a clear sense of direction.

Decision-making may be centralized or decentralized. For highly predictable and routine events, leaders make top-down decisions because they are faster and more effective. For rapidly-changing situations, leaders empower the team to make decisions in the field.

Here’s what management is about: pick good people and set the right priorities.
-Lee Iacocca

Master Your Emotions
Thomas Jefferson said, “Nothing gives a person so much advantage over another as to remain always cool and unruffled under all circumstances.” Leaders must learn to master their emotions and keep a level head. Try this self-monitoring exercise to improve your self control:
  1. Pay attention to your emotions when you interact with people. Watch out for negative feelings such as anger, irritation, boredom, jealousy, and pride.
  2. If you recognize a negative emotion arising in your mind, ask yourself why you are reacting this way.
  3. Deliberately withhold mental energy from the negative emotion. Without energy to sustain itself, the emotion will settle down and disappear back into your mind.

Although leaders come in all shapes and sizes, some personality traits are more common than others. In a review of 73 studies, researchers from the University of Florida found that extraversion was the strongest predictor of leadership4. Extroverts naturally command attention and assert themselves in group situations. The second predictor of leadership was conscientiousness. Strong organizational skills help teams finish tasks and meet deadlines. In contrast, the personality trait of agreeableness was not associated with leadership. It was Niccolo Machiavelli who said, “It is better to be feared than loved, if you cannot be both.”

The leader has to be practical and a realist, yet must talk the language of the visionary and the idealist.
-Eric Hoffer

Great leaders surround themselves with great people. King Leonidas hand-picked the 300 Spartans who stood with him at Thermopylae. At General Electric, Jack Welch delivered decades of double-digit growth by developing a system for attracting, training, and retaining “A” players. Every year, all GE employees were separated into three categories: top 20 percent, middle 70 percent, and bottom 10 percent5. The top 20 percent were showered with bonuses, stock options, and other rewards. The middle 70 percent were given training, positive feedback, and goals for moving up. The bottom 10 percent were let go. This system developed a core group of highly-motivated superstars. In turn, they attracted more good people to join GE. Winners want to play with winners.

How can you spot up-and-coming talent? According to researchers from the University of Iowa, general intelligence is the best predictor of how well a new employee will perform on the job6. Smart people learn faster and they learn more. By itself, intelligence has a predictive value of 51 percent for job performance. The predictive value rises to 63–65 percent when intelligence ratings are combined with any one of: work sample tests, integrity assessments, and structured interviews.
Work sample tests are hands-on demonstrations of job skill. For example, you might ask a software developer to write a computer program and describe the rationale behind the code. Integrity assessments screen employees for undesirable behaviors such as drinking, drugs, fighting, and stealing. In structured interviews, all applicants are asked the same questions and graded according to the same rating system.

There is little predictive value from factors such as number of years in a similar job, life experience, advanced education, hobbies, and recreational activities. Checking references is not helpful either because candidates list people who will give them glowing reviews. Even with the best assessment tools, you only have a 60–70 percent chance of identifying excellent performers. No wonder Jack Welch made a point of holding on to his “A” players.

Captains of industry are not hunting money. America is heavy with it. They are seeking brains—specialized brains—and faithful, loyal service. Brains are needed to carry out the plans of those who furnish the capital.
-Charles M. Schwab

Under Jack Welch’s system, “A” players received both financial and non-financial rewards. Although money is important, top performers are often motivated more by purpose and meaning. In 2007, basketball star Tim Duncan sacrificed $11 million from his contract so that the San Antonio Spurs could afford to surround him with better teammates7. In New York City, Mayor Michael Bloomberg works for a salary of $1 a year8.

Would you rather love your job or make more money? In a study from Duke University, managers and salespeople were asked to rank the importance of eight job characteristics: Pay, Benefits, Security, Praise, Feel good, Worthwhile, Skills, and Learning9. Results showed that the top three were: Skills, Worthwhile, and Learning. When asked what they thought their colleagues would choose, people predicted: Pay, Security, and Benefits. In fact, financial incentives were ranked in the top position only 22 percent of the time.

People want to work for a cause, not just for a living.
-C. William Pollard

In economics, a “public good” is something that is accessible to everyone, whether they contribute or not. For example, blood banks give transfusions to everyone, even to those who have never donated blood. Free-riders enjoy the benefits of public goods without paying the costs. Over time, too many free-riders may cause the system to collapse10. If no one donates blood, there is no blood to give. In experiments with cooperative games, researchers from the University of Zurich found that publicizing and punishing free-riders was the best way to encourage full cooperation11. No one wants to be embarrassed in front of the group.

Speak softly and carry a big stick; you will go far.
-Theodore Roosevelt

Group Size
In addition to rewards and discipline, group size has a big influence on teamwork. Robin Dunbar is an anthropologist who studies primate behavior at University College London. He believes that the size of the human brain limits us to a maximum of 150 stable relationships12. This limit is found in many organizations throughout history. Roman legions were organized around units of 100 soldiers. In the U.S. Army, a fighting company is comprised of 62–190 soldiers, and divided into 3–5 platoons. Each platoon contains 2–4 squads, and each squad contains 9–10 soldiers. In South Dakota and Manitoba, the Hutterites live together in fundamentalist communities that average 107 people. When a community grows beyond 150, members find that peer pressure is no longer sufficient to control group behavior. When it comes to teams, smaller is better.

System and Structure
What happens when a great leader moves on? If the right structure is in place, the team should continue performing well. In a study from the early 1950s–1987, researchers analyzed the productivity of General Motors, Ford, Chrysler, Toyota, Nissan, and Mazda13. Results showed that Toyota was the only company to maintain high levels of productivity under different management teams. The credit goes to the Toyota Production System. It consistently delivers products that customers want, and relentlessly roots out defects and wasted effort. The system is based on four general rules14:
  1. All work is highly specified for content, sequence, timing, and outcome.
  2. Every customer-supplier connection is direct. Requests and responses consist of clear yes-or-no instructions.
  3. The pathway for every product and service is simple and direct.
  4. Improvements to the system are made according to the scientific method, under the guidance of a teacher. Improvements are implemented at the lowest possible level in the organization.
The Toyota Production System enables average people to achieve excellent results. In 1982, GM closed its manufacturing plant in Fremont, California. It was producing cars with more defects and higher costs than almost any other plant in the United States. Daily absenteeism was nearly 20 percent. Drug and alcohol abuse were rampant.

In 1985, Toyota reached an agreement with GM to reopen the plant under Toyota’s management. Eighty-five percent of the original workforce was rehired, and workers were given extensive training in the Toyota Production System. Over 400 trainers were sent from Japan, and over 600 workers spent time in Japan for special training. In the year it reopened, the plant produced 6,500 cars, and achieved some of the highest quality ratings and lowest costs in the country15. With the right system, Toyota transformed a bunch of “F” players into a team of “A” players.

We get brilliant results from average people managing brilliant processes. We observe that our competitors often get average (or worse) results from brilliant people managing broken processes.

Ricardo Semler is the CEO of Semco SA, a Brazilian manufacturing company. Under his leadership, Semco’s profits have grown at a rate of 28 percent a year for 14 years16. An investment of $100,000 made 20 years ago would be worth $5.4 million today. Semco’s success has been achieved with an unusual system17. The company’s 3,000 employees set their own work hours and their own salaries. Workers hire their supervisors, and determine their production schedules. There are no organization charts, no written rules, and no dress code. It sounds like a recipe for disaster. Instead, it motivates employees to use their creativity and common sense to power the company forward. When workers are treated with trust and respect, most of them repay it many times over.

Ethics and Morals
In the 1960s, Yale University psychologist Stanley Milgram showed that an authority figure could influence people to do things against their conscience18. For the study, participants were introduced to a friendly co-subject and a stern-looking experimenter in a white lab coat. The co-subject was actually a trained actor, but this fact was hidden from participants. The experimenter explained that the purpose of the study was to investigate the effect of punishment on learning. One subject would be assigned the role of “teacher,” and the other would be assigned the role of “learner.” The teacher would read a list of word-pairs to the learner, and then quiz the learner by reading the first word of each pair. If the learner made a mistake, the teacher would turn a voltage dial, and administer an electric shock. The electric shocks would be increased by 15 volts each time the learner made a mistake, up to a maximum of 450 volts. For higher voltages, the instrument dials were clearly marked “Danger: Severe Shock.”

Participants were given the role of teacher, and the actor-subject was given the role of learner. The experimenter placed the teacher and actor-learner in separate rooms, where they could communicate but not see each other. Participants believed the learner was receiving electric shocks for each wrong answer. In reality, there were no shocks. Instead, the actor set up a tape recorder that played pre-recorded grunts and screams. After pretending to receive a number of shocks, the actor banged on the wall and shouted that he had a heart condition. After banging several more times, the actor stopped responding.

If the participant wanted to stop the experiment, the experimenter responded with a succession of verbal prods:
  1. Please continue.
  2. The experiment requires that you continue.
  3. It is absolutely essential that you continue.
  4. You have no other choice, you must go on.
The experiment was only stopped if the participant refused all four prods. Otherwise, the experiment continued until the participant administered the maximum 450-volt shock three times in a row.

Before conducting the study, Milgram polled Yale students and faculty members. Almost no one believed that participants would administer the 450-volt shock. However, it turned out that 65 percent of participants obeyed the experimenter’s commands fully, and administered the maximum shocks to the very end. Obedience resulted in extreme levels of stress. Participants trembled, stuttered, laughed nervously, and sweated profusely. Three of the participants suffered uncontrollable seizures because of the stress. But they still obeyed. As a leader, you have the power to influence your team to do good rather than evil. It’s a serious responsibility. Choose wisely.

When the power of love overcomes the love of power, the world will know peace.
-Jimi Hendrix

The Dark Side
In the 1970s, Stanford psychologist Philip Zimbardo recruited male undergraduate students to play the roles of guards and prisoners in a 2-week mock prison experiment19. Guards were provided with wooden batons and khaki clothing from a military surplus store. They wore mirrored sunglasses to prevent eye contact with prisoners. Prisoners wore smocks and sandals, and were not allowed to wear underwear. They had chains around their ankles to remind them of their role as prisoners. Guards addressed prisoners by their assigned numbers rather than names.

The experiment quickly got out of hand. Guards stripped prisoners naked, hooded them, denied them food and bedding, placed them in solitary confinement, and made them clean toilet bowls with their bare hands. As time went on, guards devised increasingly humiliating and degrading games for the prisoners to play, including simulated homosexual acts.

Zimbardo stopped the experiment after 6 days. Prisoners were suffering emotional breakdowns because of the inhuman conditions and psychological abuse. They showed symptoms of dependency, depression, and helplessness. A third of the guards had demonstrated serious sadistic behavior. They inflicted suffering on their fellow students without feeling guilty. Even “good” guards who did not abuse prisoners failed to confront the worst of their colleagues. Zimbardo concluded, “Human behavior is much more under the control of situational forces than most of us recognize or want to acknowledge. In a situation that implicitly gives permission for suspending moral values, many of us can be morphed into creatures alien to our usual natures20.”

Checks and Balances
From ruthless dictators to greedy CEOs to pedophile priests, power has an insidious way of corrupting even the most well-meaning people. As a wise leader, you should implement checks and balances on your power. You should also be careful of giving others power over you.

The ancient Greeks used the procedure of ostracism to prevent prominent citizens from gaining too much power and becoming tyrants21. Every year, citizens voted on a person to ostracize. If at least 6,000 votes were cast, the person receiving the most votes was banished for 10 years. There was no charge or defense—the accused was simply ordered to leave the state. After 10 years, the person was allowed to return and re-claim his original status and property.

Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men.
-Lord John Acton

  1. Wikipedia. Leonidas I. http://en.wikipedia.org/wiki/Leonidas_I
  2. Wikipedia. Battle of Thermopylae. http://en.wikipedia.org/wiki/Battle_of_Thermopylae
  3. Chemers MM. (2000). Leadership research and theory: a functional integration. Group Dynamics, Theory, Research, and Practice. 4(1):27–43.
  4. Judge TA et al. (2002). Personality and leadership: a qualitative and quantitative review. Journal of Applied Psychology. 87(4):765–780.
  5. Welch J. (2005). Winning. HarperBusiness.
  6. Schmidt FL, Hunter JE. (1998). The validity and utility of selection methods in personnel psychology: practical and theoretical implications of 85 years of research findings. Psychological Bulletin. 124(2):262–274.
  7. Mutoni M. (2007). Tim Duncan: Spur for life at a discounted price. Slam. October 30, 2007.
  8. Cardwell D, McGinty J. (2007). Money rubs off for city aides close to mayor. New York Times. December 14, 2007.
  9. Heath C. (1999). On the social psychology of agency relationships: lay theories of motivation overemphasize extrinsic incentives. Organizational Behavior and Human Decision Processes. 78(1):25–62.
  10. Henrich J. (2006). Cooperation, punishment, and the evolution of human institutions. Science. 312:60–61.
  11. Fehr E, Gachter S. (2000). Cooperation and punishment in public goods experiments. American Economic Review. 90(4):980–994.
  12. Dunbar RIM. (1993). Co-evolution of neocortex size, group size and language in humans. Behavioral and Brain Sciences. 16(4):681–735.
  13. Lieberman MB, Lau LJ, Williams MD. (1990). Firm-level productivity and management influence: a comparison of U.S. and Japanese automobile producers. Management Science. 36(10):1193–1215.
  14. Spear S, Bowen HK. (1999). Decoding the DNA of the Toyota Production System. Harvard Business Review. 77(5):96–106.
  15. Womack JP et al. (1990). The machine that changed the world. Macmillan.
  16. Fisher LM. (2005). Ricardo Semler won’t take control. Strategy + Business. Reprint No. 05408.
  17. Semler R. (1993). Maverick: the success story behind the world’s most unusual workplace. Warner.
  18. Milgram S. (1963). Behavioral study of obedience. Journal of Abnormal and Social Psychology. 67(4):371–378.
  19. Haney C, Banks C, Zimbardo P. (1973). Interpersonal dynamics in a simulated prison. International Journal of Criminology and Penology. 1:69–97.
  20. Zimbardo PG. (2004). Power turns good soldiers into 'bad apples'. Boston Globe. May 9, 2004.
  21. Wikipedia. (2008). Ostracism. http://en.wikipedia.org/wiki/Ostracism

Copyright © 2009 by Paul Lem, M.D.
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