Nurturing Leaders to Compete in the New Economy

SAN MATEO (06/05/2000) - Donna Dubinsky, Carly Fiorina, Meg Whitman, Esther Dyson.

What do these people have in common? They are business leaders in the New Economy, an environment where companies need to rethink resources to succeed at a time when the rules change daily.

Leaders today are faced with a staff retention problem, distributed organizations, a focus on the product rather than the person, and a trend toward mergers and acquisitions. Traditional organizations are forced to compete in the tight labor market with pre-IPO companies that could turn their employees into overnight millionaires.

For new leaders, the answer to these challenges lies in cultivating employees and nurturing future leaders. Only then does a company have the chance to compete on a global level and keep up with the speed of technology.

"Globalization and technology are changing everything -- particularly leadership," says Kevin Cashman, CEO and founder of LeaderSource, an international leadership development and executive coaching consultancy in Minneapolis. And that's true of both technology and non-technology companies.

Leaders are emerging at all levels of organizations -- not just concentrated among executives at the top -- to meet the challenges of the New Economy.

Leadership now requires additional skills, according to Rayona Sharpnack, CEO at the Institute for Women's Leadership, in Redwood City, California.

A leader must "lead change for teams and organizations, be able to rapidly change directions, be capable of collaborating across boundaries, have the facility to evoke diverse points of view, and engender a spirit of ownership and responsibility for the whole," Sharpnack says.

In addition, in today's fast-changing world, where the term "Internet year" means three months, leaders no longer have the luxury of time to make decisions.

Team members must make split-second decisions without checking with the boss.

Therefore, executives must act as mentors, giving employees the experience and confidence to make high-level decisions. This attention breeds loyalty and trust, which are at a premium in today's job market.

"People need to motivate, inspire, and help people learn," says Gail Ginder, a leadership and career coach in Healdsburg, California. "The old method of commanding people to do something is outdated."

An employee also must be empowered. By including employees in the decision process, leaders can free themselves from being overburdened and give employees the chance to sharpen their skill sets.

"A common misperception is that people at the top have all the answers," says Christopher Carrington, the Americas president of Esolutions at Electronic Data Systems Corp., in Plano, Texas. "You have to be open enough to be able to say, 'I don't have the answer.' In today's frenzied pace, quite honestly, my time to think is limited. You need to get answers from the people who have time to think."

Employees also need access to the big picture, the vision of the company.

"You must give people a context of why they're all there, a strategic context," says Barbara Britton, president of the E-commerce Integration Division of BEA Systems Inc., in San Jose, California. "You can't empower people without giving the context."

Likewise, a leader needs to make sure that he or she has recruited team members who are well-suited for the task at hand.

"While we talk about a tight labor market, it's a time when getting the right person is essential," says Leslie Wilk Braksick, president and CEO of The Continuous Learning Group, in Pittsburgh. "People can't oversee things like they used to. There's much more delegation."

Some organizations have fostered an entrepreneurial spirit within a traditional company. This approach appeals to the employee curious about start-ups and the employee rooted in traditional organizations yet interested in other options. ( See "Skyscraper or garage" in the Winter 2000 issue of WITI FastTrack at position is sacred in the New Economy. From the CEO on down, personnel are being aggressively recruited by the dot-coms. Not only is the lifestyle hawked in television commercials and print ads, but the lure of independence and a "cool" work environment is hard to compete with.

This phenomenon is not limited to established companies. Start-ups are being trumped by newer start-ups. The allure of being "employee No. 7" at that hot pre-IPO company is strong.

How can a company protect itself from poaching? Answers run the gamut.

"Dot-com companies have such a huge gravitational pull," Braksick says. "The reward structure is much more collaboratively designed and team-based.

"This is a big part of why dot-coms are winning the talent war," Braksick says.

"Job security is no greater there, but they thought through reward structures."

Some companies are combating the issue by revamping their benefits packages.

Other companies, however, believe that the problems can be solved by other means.

"Everybody's after our people. ... I treat our people with respect. I have an open door. I listen to new ideas," Britton says. "We're coming out with a new product that started at a grass-roots level. ... It all goes to people feeling valuable. It's creating a family environment. That retains people."

People skills

One of the more difficult aspects of leadership in today's climate is balancing technology know-how with the "softer" people-oriented skills. This is particularly true for dot-coms. Many leaders in start-ups are young, have climbed up the corporate ladder at supersonic speed, and need to mature as managers and leaders.

"[25-year-olds] are ahead and behind the curve" LeaderSource's Cashman says.

"It's not a new world to them, it's the world they grew up in. The disadvantage is the human tech side: They're not experienced as human beings and their tenure hasn't been long enough to absorb that. ... It creates the potent mixture of ability to succeed in the new world without the commensurate human skills to sustain it."

Increasingly, leadership novices will need to jump-start their human skills.

The technology skills that have propelled them into the limelight won't be enough to sustain a company or department.

"It takes maturity and a willingness to be wrong and say, 'I don't know'," Ginder says. "The main thing is to be a constant learner, not only about the product and the service but also about people."

What you see is what you get

Another technique used by successful new leaders is offering employees something constant to rely on: their own integrity and honesty.

Today's employees are sophisticated when it comes to corporate doublespeak, and there's a lack of tolerance for a boss who says one thing and does another. In the ever-tightening job market, not paying attention to this rule could spell trouble.

"How do you make sure you're authentic?" EDS' Carrington asks. "Give them the business reasons why you can't do something. You have to be honest."

"If I can do something, and I believe it's in the good interest of the business, I make sure it happens," Carrington says. "I make sure a change has been created because an issue has been brought to bear by an employee."

By making sure he or she is authentic, the new leader garners something that's difficult to quantify: trust.Without established trust, it is difficult for an employee to be confident and productive.

"How do you define trust? How do you build it within your organization?"

Braksick asks. "Leaders don't realize that even if you say the right things, the systems that work within the company might be set up to reward different behaviors."

Geographical differences

Another leadership challenge is managing remote workers. Nurturing without daily face-to-face interaction poses its share of difficulties. There is a high potential for the worker to feel left out of the team, and archaic meeting structures and time zone differences can compound the issue. The biggest hurdle is constant communication to motivate a remote worker.

"People who lead other people from a distance require different ways of operating," Ginder says. "We need to make use of technology in ways that it never has been used in history. Communication must be clear and excellent.

Ignore the human dimension and you're in big trouble."

Leaders new to remote management can take lessons from veterans. One such veteran understands the importance of communication and the dire implications if it's not addressed.

"Previously I ran [BEA Systems] Worldwide Services, with 52 offices of consultants and support services," Britton says. "Communication challenges are endless. Everyone needs perfect clarity of what their role is. If anyone has any doubts about that, the system fragments."

Communication comes in many forms, especially with the onslaught of technology solutions.

"There's no approach that works across the board. You have to do multiple operating mechanisms: e-mail, conference calls, town halls, walkaround management. Often that's intimidating for the employee," says Carrington.

Some excellent resources on the Web can help leaders tackle these issues. For a report on virtual teams, check out

Another good resource is, which lists resources, services, and suggestions for the manager of a remote worker.

Potential pitfalls

However, technology skills alone don't make a successful leader. So-called softer skills are what will make the difference.

"A key characteristic of the CEOs of the future is to see life as a journey, not as a destination. This means that they need to learn to be emotionally intelligent, to communicate widely, consistently, and effectively," says Christopher Clarke, president of Boyden Global Executive Search, in New York.

Leaders also need to remind themselves that they are part of a bigger process and team.

"The biggest pitfalls of a leader are letting your own agendas get in the way of the overall goals, being swayed by other agendas, and forgetting to say thank you," says Dawn Riley, CEO and skipper of the San Francisco-based America's Cup contender America True and 1999 Rolex Yachtswoman of the Year.

Experience and compassion differentiate the leader of tomorrow from the leader of today. Creative solutions, employee empowerment, and a knack for communication will make a big difference.

"You have to work hard and you have to play hard. I've done it wrong in my life. I've built teams that didn't work well. I've made a lot of mistakes.

That's why I'm so proud of what we've done here. I've finally figured it out," BEA Systems' Britton says.

Leadership continuum

Leadership evolves throughout a career in the following steps. People often focus too much on the first two and sacrifice the second two.

Content learning Employees learn about content, technology, software, and process. This type of learning is grounded in academics and organizations.

Skill development This is the stage of learning during which skills are applied. It's one thing to know something, yet it's another thing to apply it.

Personal development Employees start to learn about themselves. They question their impact, their strengths, and their development needs.

Interpersonal development Employees start to work on the dynamic between themselves and others.


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