Sage  Growth  Partners    Level  5  Leadership      Moving  from  Good  to  Great    

Today’s  Agenda  

•   If  only  we  knew!    

•   What’s  an  ownership  culture?    

•   Good  to  Great  Primer    

•   ConvenDonal  wisdom  –  NOT!    

•  Small  groups  

-­‐Jim  Collins,  author  

“Good  is  the  Enemy  of  Great.”  

Empirical  Evidence  

•  Answer:  “How  does  a  good  company  become  great?”  

•  Research:  1435  companies  down  to  11  plus  peer  firms  for  comparison  purposes,  

•  20  researchers  for  5  years,    

•  QualitaDve  and  quanDtaDve  analyses,    

•  15  years  at  market,  inflecDon,  15  years  at  3x  market  threshold  

•  Firms  on  p.  7.  

What  they  didn’t  find…  

•  Larger-­‐than-­‐life,  self-­‐promoDonal  leaders  from  outside  the  firm  –  10  of  11  from  within,  

•  Specific  linkage  between  the  specific  forms  of  execuDve  compensaDon  and  movement  from  GTG,  using  incenDves  not  to  moDvate  but  to  get  and  keep  the  right  people  

•  Evidence  that  GTG  companies  spent  more  Dme  on  long-­‐range  strategic  planning,  

•  A  focus  on  what-­‐to-­‐do  as  much  as  what  not-­‐to-­‐do  and  what  to  stop  doing,  

What  they  didn’t  find…  

•  That  technology  causes  transformaDons,  but  yet  accelerates  transformaDons,  

•  That  mergers  necessarily  ignite  a  transformaDon,  

•  That  GTG  companies  spend  Dme  managing  change,  moDvaDng  people  or  creaDng  alignment  –  they  don’t  need  to,  

•  TransformaDonal  slogans,  and  no  revoluDons,  but  evoluDons,  

•  GTG  companies  in  great  industries,  many  in  terrible  industries.    

Level  5  Leader?  

 Level  5  Leader!  

 Personal  Humility  •  Modest  •  Inspired  standards,  not  inspired  charisma  •  Focus  on  Company,  not  the  self  •  ApporDons  credit  for  success  

         +  Professional  Will  •  Creates  superb  results  •  Unwavering  commitment  to  long-­‐term  results  •  Sets  the  standard  for  and  enduring  company  •  Looks  inward,  not  outward  to  apporDon  responsibility  for  poor  results        

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                                                             First,  Who,  Then  What       Teach  for  America  

•   1988:    1  idea,  1  person,  and  a  $26,000  grant  •   2005:    14,000  new  teachers  a  year,  and  $40  million  in  annual  

support  

First  Who,  Then  What:  Success  Factors  

•  ProducDve,  self-­‐moDvated,  disciplined  volunteers  •  The  more  selecDve  the  process,  the  more  adracDve  the  

opportunity  •  The  opportunity  must  be  meaningful  

The  5  DysfuncDons  

Absence of TRUST: Invulnerable

Fear of CONFLICT: Artificial Harmony

Lack of COMMITMENT: Ambiguity

Avoidance of ACCOUNTABILITY: Low Standards

Inattention to Results

Status and Ego

 The  5  “FuncDons”      

Trust & Vulnerability

Unfiltered Conflict around Ideas, Not People

Buy-in to Plan of Action

Peer ACCOUNTABILITY

Collective, Team Goals

QuesDons?  

Thank  you  

Don  McDaniel  dmcdaniel@sage-­‐growth.com    

410.534.1161  443.904.2882  

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