I had the opportunity recently to present to a group of current and future leaders in my home state of Delaware. The topic of the discussion was Building Partnerships: An Evolving Leadership Imperative and was given to the Leadership Delaware organization class of 2010. I thought I would share the discussion with my readers.
Enjoy, and as always, I welcome your thoughts!
Building Partnerships: An Evolving Leadership Imperative
I am currently reading the book “All for One: 10 Strategies for Building Trusted Client Partnerships” by Andrew Sobel. In the first Chapter of the book Mr. Sobel describes the redwood forests of northern California which provides an interesting metaphor for the topic I will be discussing here.
You see the Redwood tree is a remarkable feat of nature. This monster of a tree can grow up to 350 feet tall. It is the tallest living thing on Earth. And yet its root structures are often not more than 6 feet deep. If you do the math that is only 1.7% root structure in comparison to the tree that is above ground. Well I can tell you from pulling weeds in my back yard that some of those weeds probably have a 50% root-to-stem ratio as witnessed by the back strains I have experienced trying to pull them out.
So here you have a tree with a root-to-stem (albeit a big stem) ratio of 1.7% and yet these things don’t fall over in the first windstorm. And they stand for 500 to 1000 years. How is this possible?
The answer appears to lie in partnership and collaboration. That root structure spans out some 80 feet from the base of the tree. And when it meets up with the root structures of adjoining trees it intertwines with them creating a network of roots that is extraordinarily strong and supportive. You see, underlying the entire Redwood forest is a fascinating display of natural order, collaboration and coexistence.
Now if you are a nature lover you understand that this is not unique. Much of life has evolved this way. In fact the whole of nature which is seemingly “out in the open”, “unstructured”, “unscripted” if you will, has evolved as partnerships between one living species and another. It is the essence of what life is, is it not?
So what does this have to do with a discussion on leadership and partnership in the business world?
Well, let me first start off by telling you a bit about the world that I grew up in. It was a world characterized by the cold war. It was a global climate of suspicion and mistrust, closed borders and the Berlin Wall. In business it was a world of intense corporate competitiveness, silos of capability, “not invented here” thinking, hierarchical command and control structures, low tolerance for ambiguity and uncertainty, contract-clad relationships, closed doors and proprietary information paranoia. You were either a corporate citizen or an outsider. If you were an outsider you were a competitor, a supplier or a customer. Information flow and communication was obviously closest with the customer (albeit tightly controlled), only as absolutely necessary with suppliers and nonexistent with competitors.
Margaret Wheatley in her book “Leadership and the New Science: Learning about Organization from an Orderly Universe” published in 1992 described the organizations of the day in this way.
“Many of the organizations I experience are impressive fortresses. The language of defense permeates them: in CYA memo-madness; in closely guarded personnel files; in activities defined as campaigns, skirmishes, wars, turf battles and the ubiquitous phrases of sports that describe everything in terms of offense and defense. Some organizations defend themselves superbly even against their employees with regulations, guidelines, time clocks, and policies and procedures for every eventuality. One organization I worked in welcomed its new employees with a list of twenty-seven offenses for which they would be summarily fired-and the assurance that they could be fired for other reasons as well. Some organizations have rigid chains of command to keep people from talking to anyone outside their department; and in most companies, protocols define who can be consulted, advised or criticized. We are afraid of what would happen if we let these elements of the organization recombine, reconfigure or speak truthfully to one another. We are afraid that things will fall apart.”
I must admit that I subscribed to this mode of operation to some degree. I suppose it made sense at the time and it was commonplace. To be a leader in an organization when I first entered the business arena was actually not really that difficult. You lived within the walls of a company. The people you worked with for the most part were all within the walls of that company. There was a hierarchical structure that was generally obeyed. Leaders identified strategic projects and prioritized them; Managers built project plans, set up tasks and delegated responsibilities to others. “The worker employee” basically followed instructions. I obviously oversimplify but that was the dynamic of the relationships.
You invented and innovated within the walls of the company. If you needed a specialty you usually hired it. The business problems, the technologies, the processes were all advancing rapidly but were still relatively easy to understand. At least in my field the competition was generally regionally-based and limited in number. We all pretty much had similar ways of delivering the services we provided and since there were not a lot of competing models, value propositions or differentiators, winning typically came down to price and the strength of the relationship with the customer. And when we did win the contracts and associated extensions, assuming you didn’t do something catastrophic, could last for years. So I guess what I am saying is that these were the “good old days”.
Leadership back then could be equated to guarding the caches; building fortresses to keep enemies out and to instill order within the walls; keeping a watchful eye on those that would threaten our livelihood and cultures and to resist change by creating orderliness that was rigid and un-malleable.
Now fast forward…
Our world today can be summed up in two words: Speed and Complexity. The business organizations of today must constantly and rapidly redefine themselves against an ever changing business landscape. The things we called value 20 or 30 years ago no longer apply. Information rules! Business transactions are carried out in milliseconds or even nanoseconds. A quick search on the Google can yield hundreds or thousands of bits of knowledge in a matter of seconds. A misguided thought or statement made late in the evening can be heard on the other side of the world and can start a viral response before we have eaten our breakfast. Well-guarded secrets are now shared freely and in great detail on sites such as WikiLeaks. Hackers and terrorists threaten to wage war on our personal and national wealth…security has become an elusive state of being. Response and action are measured in a fraction of the time we used to allow. Thanks to companies like WorldCom and Enron, there is an ever-increasing distrust in the empires of commerce and a sea of new regulations that must be addressed at every turn. Social networking has introduced a new and evolving paradigm for human interaction. Tom Friedman has revealed to us that the world is truly flat: A global economy drives our social, technological and political infrastructures. And creating value for clients is like shifting sand.
A new model of collaboration has emerged and is changing the old command and control organizational designs. In the world of information technology, hundreds if not thousands of visionaries, architects, designers, developers and testers all come together from around the globe to innovate new products that are created in a distributed, loosely coupled set of virtual teams under new agreements and contracts that are unlike the rigid and controlling legal mechanisms of the past. And in many cases they are not motivated by profit and salaries, but rather through the challenge of being a part of something revolutionary, challenging, fun and inspiring.
Open source software development is challenging the old definition of value, the hierarchical command and control structures we thought were necessary for success, the nature of team work and the traditional institutions that had a lock on the software development industry.
Open market places and the “Long Tail” of economics as described by Chris Anderson have emerged and are changing the economics of many industries. The traditional world of one vision, one design that we market, sell, upgrade and maintain is being played out today in an open market place characterized by the new mantra…”There’s an app for that”.
We now live in a world that is no longer characterized by single products or services delivered to individual customers but rather one of complex, integrated solutions made up of components, modules, interfaces, disparate data stores and people that must be delivered in end-to-end, integrated but loosely coupled solutions that meet the needs of many and that must grow, change and evolve with the needs of individuals, communities and businesses. No one individual or company can serve all the needs of a market or even a single customer anymore. The need for malleable frameworks and organizational models made up of an ever-changing set of customers, suppliers and competitors is evident.
Even the traditional employee-employer relationship has changed. Employees, once loyal for years to the company that held their paychecks, are now more akin to free agents. Mass layoffs, reductions in pay, elimination of retirement benefits has strained the company “lifer” paradigm and is being replaced by a more fluid workforce that seeks out the “best situation for now” as opposed to the “best situation for later.” The trust has been breached and the labor market is not governed by the laws of the collective but rather by the laws of the individual that continually seek win/win relationships in their employment situations.
Suppliers are no longer entities to simply haggle with over price or to penalize for missed expectations. They have evolved to be contributing members in the value chain; involved deeply in customer and market strategies. Our relationships with our suppliers is requiring a true understanding of what they value as a business and true collaboration in an open forum of customer/supplier in order to create an integrated vision of business value.
Competitors of old are now partners. In every company/competitor situation lies an opportunity to join forces to exploit the unique capabilities that each company can bring to the table to deliver rich and sustainable solutions to the markets they serve and to enable them to enter and capture new markets. Innovation and growth today demand that we open up dialogue, exploit emerging technologies and seek out emerging markets in what Kim and Mauborgne have called “Blue Ocean Strategies.”
In the old paradigm, partnering with customers used to mean conducting focus groups, doing customer satisfaction surveys and the like. In today’s world, customers are called upon as true partners to define needs, submit design ideas, collaborate with design and development teams and define pricing and packaging scenarios. We now allow and even require that our customers are active participants to shaping our products and services.
So what does this all mean for the leaders of tomorrow?
As stated before, to be a successful leader in the world today is a lot harder than it was when I started in the business world. It requires an entirely new mental framework, new skill sets and a required appreciation for collaborative partnerships that reinforce the notion that the whole is greater than the sum of its parts.
Marshall Goldsmith, the founding director of the Alliance for Strategic Leadership states that “the ideal leader is a person who builds internal and external partnerships.” Marshall conducted a study of some 200 high potential leaders and his results point to the ability to foster and manage partnerships as the key differentiator of a successful leader. His results show that the successful leader fosters both internal and external partnerships within an organization. The internal partnerships are with direct reports, co-workers and managers. The external partnerships are with customers, suppliers and competitors.
In Marshalls report, “Building Partnerships” he states that:
“The leader of the future will need to be skilled at managing these relationships. In many ways, telling direct reports (who know less than I do) what to do is a lot simpler than developing relationships with partners (who know more than we do). Working in a silo is simpler than having to build partnerships with peers. Taking orders from managers is simpler than having to challenge the ideas that don’t meet customer needs. Selling a product to customers is simpler than providing an integrated solution. Getting the lowest price from suppliers is simpler than understanding their complex business needs. Competing with competitors is simpler than having to develop complex customer-supplier-competitor relationships. The challenge of leadership is growing. Many traditional qualities like integrity, vision and self confidence are still needed. But building partnerships is becoming a requirement, not an option for future leaders.”
I ran across an article on the internet that provided what I believe to be a fairly comprehensive review of the role of the leader in fostering partnerships in today’s world. This article entitled “A Pocket guide to Building Partnerships” was published by the World Health Organization. Although this is not a complete list of the roles and responsibilities of the future leader I think you will understand from this abridged list just how crucial the role of leadership is to building and maintaining partnerships to drive true value. The article states that new leaders of today must:
- Have a clear vision of the value that the partnership will deliver that is shared and clearly understood by all partners in the value chain;
- Assess and understand the mutual needs of all partners. What are their business drivers, what represents success and a win/win relationship to them?;
- Welcome and ensure the free flow of information while at the same time making sure the proprietary interests of all partners are protected;
- Define the structure and management of the partnerships to ensure that clear expectations, accountability, fairness, efficiency and effectiveness are maintained;
- Monitor formal and informal power-bases to ensure that all parties are represented and have an equal voice;
- Have an operating mission that will clearly define how the partnership will accomplish its goals;
- Create, adopt and agree on a common language;
- Understand the differences in culture between each partner in order to accommodate those differences;
- Be a facilitator, not an authoritarian;
- Ensure that the objectives of the partnership are achievable;
- Make sure the priorities of the partnership are well-established;
- Define the rules, roles, responsibilities and duties within the partnership;
- Facilitate and drive quick decisions;
- Enable the building of relationships across partners;
- Ensure that the “right” skills and expertise is represented and;
- Ensure that the partnership and subsequent solutions are fiscally sound.
Now I submit that this is a somewhat daunting list but then again, as leaders, we must rise to the occasion. As Marshall Goldsmith has pointed out, innovation and growth today demand an integrated and intertwined network of partnerships that will form the root structure and stability to enable individuals and organizations to rise to new heights; that will enable them to become the Red Wood trees in the global forest of business and commerce. And the current and future leaders, regardless of the industries they serve, will become the catalysts to making this happen.