“Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.” 

Jack Welch

I recently had an exchange with the president of a very successful manufacturing firm who expressed something that I have no doubt is responsible for the results she gets. “I put my 40 employees first,” was her straightforward comment. She’s true to her word.  I’ve heard her speak on business related issues, and it’s evident that among her highest priorities are (1) understanding her employees’ needs, and (2) arranging the conditions that maximize their ability to use their skills and talents. 

The “employees first” mentality pays — if you take a look, businesses counted among the “best places to work” are invariably atop of their industries in profitability and customer loyalty.  The linkage is very clear, and it’s not just a correlation.  It’s a “cause-effect” relationship, and it emanates from a source that can be summarized in two words— effective leadership.

What about “customers first?”

“Customers first” is a great advertising slogan. After all, who would patronize a business that expresses any other spirit? Beyond advertising however, lies reality. And a more realistic view is that you need to be sure that your business has a reputation for seeing to the needs of customers better than your competition does. And who serves the needs of your customers? Your employees. 

Steven Covey, in his book, The 8th Habit:  From Effectiveness to Greatness, cites that far too many workplaces mismanage their people, frustrating and de-motivating them. This becomes especially true during economic downturns, when organizations adapt by using “lean and mean” approaches to doing business: This means high workloads, long hours, minimal job security, low trust, and of course, high stress. While it looks good on the books in the short run, it leads to burnout, inefficiency, and often the loss of the best employees, who find that their talents are in demand in rival companies.

Internal customers:  Employees serving each other

Organizations that tend to appear among the best places to work typically regard their employees as “internal customers:” As an interdependent network of people who support each other so that “external customers” — the ones who really pay the freight — are served in ways that meet or exceed their expectations. The executive I cited at the outset of this article is keenly aware of this and uses it as a sound business strategy.  Many other business leaders are not as astute.

A few years back, Harris Interactive polled 23,000 full time employees and found some rather disturbing results in terms of how many of them saw their workplaces. One of these was that only 15 percent felt that their organizations were equipping them to achieve important goals. In addition, a minority (37 percent) of them actually knew what their organization’s strategic plan and goals were, only 20 percent trusted the organization that they worked for, and only 15 percent regarded their workplaces as fostering open communication and the sharing of ideas.

Other studies of workplaces show that the majority of business leaders report that they wish that they could get more out of their employees, while the majority of employees report that they could do their jobs better if they were allowed to. Apparently, a lot of talented and responsible people are producing less than they would if they could.

Steve Covey’s The 8th Habit includes a chapter called “The Pain,” in which he offers quotes that represent the feelings of many people who are exasperated with the situations in which they work. A few of these appear below:

“I’m beat up to get the numbers. The pressure to produce is unbelievable. I simply don’t have time or the resources to do it all.”  

“I’m micromanaged and suffocating.”

“I’m sick of all the backstabbing politics and kissing up.”

“No one really values or appreciates me. My boss doesn’t have a clue of what I’m capable of.”

As peculiar this may sound, an awful lot of American workers are being overworked and underutilized both at the same time!

Leadership makes all the difference in the world

There are indeed many workplaces in which employees feel valued, are highly productive, and get to use their talent and creativity to the benefit of themselves and those they work for. Some fine examples exist and can serve as models for others to benefit from. Apple, Inc. is one such workplace, having recently become the wealthiest American company in terms of market capitalization. 

There isn’t a person I know in business that doesn’t admire what Steve Jobs has been able to do with Apple, which is to continually create an environment that fosters innovation. Over the decades, he has not only responded to trends and changes in markets, he has determined them. The energy and enthusiasm among Apple employees is palpable, and it consistently produces results — not to mention profits.

Types of leaders: A short list

One way to understand leaders is by looking at their effects on their subordinates.  Although I’m generally wary of categorizing, I think that the following breakdown of leaders into three types is at least suggestive why some organizations “sizzle,” while others “fizzle”:

“Enhancers”:  Leaders who fit this bill are a joy to work with. They are authentic, enthusiastic, and radiate a passion for the work involved. They foster a high trust work environment and are masters when it comes to delegating authority and unleashing the potentials of those that work for them. They lead by example and seek feedback regarding how they can help their employees do their jobs better. 

“Neutralizers”: These are leaders who are uninspired and uninspiring. Often achieving their positions because of their technical expertise, their people skills are not very well developed. They are diligent when it comes to details, but lack imagination. They are not incompetent, but their lack of passion tends to foster mediocrity and not much more.

“Diminishers”: These are the Simon Legrees and Captain Blighs of the business world.  They are authoritarian and insensitive, using intimidation and pressure to accomplish their goals. They foster an atmosphere of mistrust, which tends to spread and infect those that work under them. They frustrate their employees, keep them on the defensive, and often view highly competent others as threats. Their leadership actually holds their organizations back, producing low morale, high absenteeism, and high turnover.  

Granted, we need to be careful about making generalizations, but many of us have encountered individuals who do conform to these descriptions to at least some degree.  In truth, most of us have elements of each of the above in us, depending upon the situations that we find ourselves in. The key to success is developing the levels of self awareness and authenticity that will allow us to exploit our strengths and to not let our foibles become problems for others.

Putting employees first: Refrain

Research on the effectiveness of public companies that perform well, in contrast to those that struggle, show some differences in the priorities of their leadership that are quite revealing. The importance of putting employees first comes through loudly and clearly.  In public companies that are mired in mediocrity or declining, the first three priorities tend to be: (1) their stockholders; (2) their customers; and (3) their employees, in that order. Such companies are typically concerned with manipulating near term stock prices, and often inflate their projections of profits and earnings. They also often display reactive responses, such as reorganizing — after it comes out that things are not going so well. 

In contrast, in companies that demonstrate genuine growth over long periods of time, the first three priorities tend to be: (1) their employees; (2) their customers; and (3) their stockholders. The results of this approach are that the stockholders tend to be very satisfied, since their customers are well served by employees who are much more committed and willing to give their all.

Investing in personal growth and development

In addition, research on how business leaders respond to economic downturns tells us much about how and why successful leaders get the results that they do. Those that invest in training and development programs for themselves their employees tend to suffer much less from the bad economic times, in contrast to their competitors who respond by “hunkering down” and focusing primarily on cutting spending.

When economic recoveries occur, as they invariably do, companies that have invested in employee growth and development show twice the rate of growth that their more miserly counterparts do. The fact is that if you play all defense, you’re probably overlooking opportunities and will be outclassed by competitors who are more optimistic and upbeat in their approach to doing business.

Investing in yourself

The most successful leaders are also those who are ever on the alert for ways to improve themselves — by reading, attending seminars, workshops, and seeking advice and coaching. It’s probably no accident that many of the best business leaders have broad interests, including a fascination with history. If you think about it, leadership is a major theme in history, so this makes sense. It’s surprising how relevant the dilemmas that past leaders have faced are to current events.

There is another aspect of studying history as a stimulus to personal growth that is consistent with good decision making — it’s an inexpensive habit. Used books are everywhere, and libraries are among the least costly and most beneficial resources available. Reading is also relaxing and informative, and is a great way to end your day.  It is certainly much better for the nervous system than television, with its unending barrage of commercials, bad news, and endless spin cycles. 

As has often been said, “leaders are readers,” so do yourself and your employees a favor. Take some time away from the TV, grab a book, learn, grow, relax, and recharge.