Category Archives: Resources

The Leadership Paradigm

Unconventional thinking from extraordinary leaders
By Daniel R. MacDonald

In every successful business, you will find great leaders who do not allow their thinking to be confined by the tradition, norms, or unwritten rules of their industries. When leaders of other companies say, “That’s not the way we do it”, great leaders ask, “Why not?” The ability to think unconventionally provides a competitive advantage that helps exceptional leaders succeed.
A great example of an unconventional thinker is Michael O’Leary, CEO of the European based discount airline Ryanair. To help make his company successful, he met with Herb Kelleher, co-founder of the U.S. based discount carrier South West Airlines. O’Leary’s goal was to learn everything he could about the discount airline business from Kelleher. The action of asking potential competitors for their secrets to success is considered abnormal and potentially even ludicrous but O’Leary did not let this stand in his way. He set up a meeting with Kelleher for that very purpose.
During the years that followed, O’Leary not only applied what he learned from Kelleher but he took the concepts and strategies to a new level. Ryanair provides customers with incredibly low fares but proceeds to charge for everything else: food, pillows, blankets, checked baggage and even water. Seats on Ryanair aircrafts do not recline because, by removing this feature, additional rows of seats could be fitted onto each aircraft to make room for even more customers. The pockets on the back of each seat have been removed so that cleaning crews do not have to be paid to remove trash left behind by departing passengers. At one point, the removal of window visors on the aircrafts was considered in efforts to prevent having to pay staff to reset them to the upright position before each new flight. In order to augment revenues and profits further, O’Leary even considered adding pay toilets to the company’s aircrafts and online gambling to Ryanair’s website. It goes without saying that O’Leary’s ideas are outside of the norm for the industry. Most executives in the airline industry would agree that this is not the way that airlines are supposed to do business. But there are many people who like what O’Leary is doing as evidenced by Ryanair’s 2009 earnings which were in excess of $431 million. This is quite a feat considering that the average Ryanair fare is approximately $42.50. O’Leary’s way of thinking has allowed him to grow his tiny regional airline into an aeronautic giant that transports over 85 million passengers each year to 155 airports in 26 countries. The company’s market capitalization of $7.2 billion rivals that of Southwest Airlines and trumps that of its competitors Aer Lingus and easyJet. Most leaders in the airline industry would love to experience the same growth and profit margins as Ryanair but do not copy the strategies that have made it a success. Why not?
Unfortunately, many executives, not unlike the average person, have mental barriers that prevent them from seeing past or thinking through the conventions and norms that surround them. In his constant drive to cut prices, O’Leary questioned why every plane needs two pilots when only one would do. Most other airline executives would never have even considered this idea. “We must have two pilots” would be their instinctive response. O’Leary would argue that one pilot combined with the automatic pilot feature and another crew member trained to land the plane in the case of an emergency would be enough. Regardless if single-pilot commercial flights become a reality or not, the key is that extraordinary leaders have the ability to think outside of the box and question tradition. They can mentally navigate beyond the barriers of conventional thinking to find new and innovative ways to succeed.
Bill Comrie, founder of the Brick Warehouse, is another example of a great leader who thinks unconventionally. During a period when the company was experiencing no sales growth, Comrie called a meeting with his buying team. The meeting began with the buyers sharing horror stories that resulted because of the tough economic times: factories were going out of business, large standing orders were being cancelled by major retailers, and sales decreases and negative profit results ravaged the industry. After listening to tragic tale after tragic tale, Comrie jumped up and yelled, “This is great! Don’t you see it? This is great!” As he looked around the room repeating his question, the buyers lowered their heads without responding to avoid eye contact with their leader. After repeating the question a few more times, Comrie looked at the group and said, “Don’t you get it?” After a long pause he matter-of-factly said, “You have never had a better time to buy than right now.” He pointed out that the poor economic conditions created a buyer’s market and reminded them that they were buyers. He asked the group to find some amazing deals that could be passed onto their customers during a major sales event. At the next meeting, the room was buzzing with excitement as everyone had extraordinary news to share. Not only did the group secure some great deals, but all of the vendors provided additional support for the sales event which made it a huge success. The Brick Warehouse was one of the few furniture retailers that year to achieve a noticeable increase in sales all thanks to Comrie’s ability to think unconventionally.

Besides considering options that others would not or viewing things differently than most, great leaders avoid the mental traps that other leaders fall into. Many organizational leaders work hard to get their companies to a certain point only to believe that the hard work is done. The leaders of these companies doom themselves by believing that they “have arrived”. Another downfall of some leaders is the curse of mediocrity which is evidenced through their use of the phrase, “It’s good enough” or “It’s fine the way it is”. Even more dangerous is the phrase, “We’ve always done it this way”. This way of thinking can prevent leaders from exploring innovative ideas or beneficial changes that are required for the future success of their organization.

“Somewhere in a basement, a garage or an apartment there is an entrepreneur forging a bullet with your company’s name on it.”
Gary Hamel – Management Expert

There are many examples of companies that have outperformed their major competitors by changing the rules of the game. It happened in the investment community when Charles Schwab outgrew Merrill Lynch by getting into online trading first. Newspaper publishers lost significant classified advertising revenue to online websites like Craigslist, Kijiji, and eBay. Dell surpassed industry giant Compaq in computer hardware sales with the direct-to-consumer business model. Though the examples are endless, it is rare for leaders in established businesses to make the changes necessary to effectively compete.

It is evident that great leaders think unconventionally, but is it something that everyone can do? Probably, but it takes considerable effort and practice. Here are three strategies that can be applied to help you think more like a leader.

1. Suspend judgement – To think more like a leader, it is critical to assume the mindset that anything is possible. When generating ideas, do not consider if an idea will work or if it makes sense, simply focus on the quantity of ideas; contemplation of ideas’ quality comes later.

2. Ask “why not?” – Use the “Why not?” line of thinking to assess your ideas. If you think an idea will not work, ask yourself why not and focus on how your idea could be made plausible. This will help you identify assumptions, conventions, and norms that may be limiting your thinking. Once you identify these barriers, you can work to overcome them.

3. Innovate – Determine ways to apply successful strategies, concepts, and ideas used in successful companies to your organization. This is an effective way to stay ahead of your competition.

Learning to think unconventionally requires concentrated and applied effort over a long period of time; however, the rewards in terms of potential growth and profitability are worth it.

Dan MacDonald is President of BIS Training & Development, an Alberta based company that specializes in online and classroom based corporate training. MacDonald is the co-author of three books: Leadership, Management, and Success. To find out more about BIS Training & Development, visit www.trainanddevelop.ca

Sources:
Lazar, F. (2007). The potential economic impacts of reducing the federal government’s ground rents for Toronto Pearson International Airport and reducing the federal excise tax on aviation fuel. Retrieved from http://www.atac.ca/en/files1/Lazar%20report%20final%20v%20Feb%205.doc
Capell, K. (2006). Wal-mart with wings. Bloomberg Businessweek. Retrieved from http://www.businessweek.com/magazine/content/06_48/b4011064.htm
Gillette, F. (2009). Ryanair’s O’Leary Mulls One-Euro Toilets, Standing Passengers. Bloomberg Businessweek. Retrieved from

http://www.bloomberg.com/news/2010-09-02/ryanair-s-o-leary-ponders-pay-toilets-standing-passengers-in-profit-quest.html

The Future of Leadership

This arcticle has been graciously donated by LeadersDirect.com.
Written by Mitch McCrimmon, Ph.D.

  • Our primary image of the leader comes from the military.
  • Great leaders have always been heroes, especially military heroes.
  • Hero worship is OK if it inspires us to greater heights.
  • But bad if it disempowers us, making us dependent on heroes.
  • Military heroes know where to go and how to get there so can lead from the front.
  • Organizations today need everyone thinking about new directions to pursue.
  • No one person can now lead from the front without a crystal ball!!
  • Future leadership depends on complex knowledge and innovation from all.
  • 21st century leadership is not dependent on position. Leadership now means promoting a better way. This is an ACT not a role. Front line employees can show leadership without even being seen as informal leaders in the sense of taking charge informally of the group.

The role of innovation

  • Innovators lead by showing us where our industry is likely to go next.
  • The implication is that your leaders do NOT need to be inside your organization!
  • We already speak of “market leaders” — so leadership can come from anywhere.
  • Leadership is too often confused with the question of how people in positions of
    AUTHORITY influence employees to pull in the same direction.
  • Why is it then that entrepreneurs do not need (internal) leaders? They look to industry leaders for inspiration and role models to beat.
  • Such leadership is about innovation – not using influence skills to motivate employees.
  • Why develop leaders to be nice instead of fostering real leadership through innovation?
  • Some leaders have good people skills, others are too self-absorbed, too focused on their own ideas or on beating competitors.
  • Who would follow such leaders? Opportunists who know a good thing when they see it, who are ready to jump on a bandwagon with little or no persuasion. People who are likely to be leaders themselves in other words.
  • As knowledge workers become empowered enough to think like entrepreneurs they will look outside for leadership if you can’t provide it. But does it matter?

The Helium Stick Activity

Activity Summary

Deceptively simple yet powerful teamwork activity for learning how to work together and communicate in small to medium sized groups. Form two lines facing each other. Lay a Helium Stick on the group’s index fingers. Goal: Lower to ground. Reality: It goes up!

Equipment

1 thin, light-weight, 10 ft Helium Stick with activity guide & facilitation notes.

Group Size

8 to 12 ideal, but can be done with 6 to 14

Time

Total time ~25 mins

  • ~5 minute briefing and set up
  • ~10-15 minutes of active problem-solving (until success)
  • ~10 minutes discussion

Instructions

  • Line up in two rows which face each other.
  • Introduce the Helium Stick- a long, thin, lightweight rod.
  • Ask participants to point their index fingers and hold their arms out.
  • Lay the Helium Stick down on their fingers. Get the group to adjust their finger heights until the Helium Stick is horizontal and everyone’s index fingers are touching the stick.
  • Explain that the challenge is to lower the Helium Stick to the ground.
  • The catch: Each person’s fingers must be in contact with the Helium Stick at all times. Pinching or grabbing the pole in not allowed – it must rest on top of fingers.
  • Reiterate to the group that if anyone’s finger is caught not touching the Helium Stick, the task will be restarted. Let the task begin….
  • Warning: Particularly in the early stages, the Helium Stick has a habit of mysteriously ‘floating’ up rather than coming down, causing much laughter. A bit of clever humoring can help – e.g., act surprised and ask what are they doing raising the Helium Stick instead of lowering it! For added drama, jump up and pull it down!
  • Participants may be confused initially about the paradoxical behavior of the Helium Stick.
  • Some groups or individuals (most often larger size groups) after 5 to 10 minutes of trying may be inclined to give up, believing it not to be possible or that it is too hard.
  • The facilitator can offer direct suggestions or suggest the group stops the task, discusses their strategy, and then has another go.
  • Less often, a group may appear to be succeeding too fast. In response, be particularly vigilant about fingers not touching the pole. Also make sure participants lower the pole all the way onto the ground. You can add further difficulty by adding a large washer to each end of the stick and explain that the washers should not fall off during the exercise, otherwise it’s a restart.
  • Eventually the group needs to calm down, concentrate, and very slowly, patiently lower the Helium Stick – easier said than done.

How Does it Work?

The stick does not contain helium. The secret (keep it to yourself) is that the collective upwards pressure created by everyone’s fingers tends to be greater than the weight of the stick. As a result, the more a group tries, the more the stick tends to ‘float’ upwards.

Processing Ideas

  • What was the initial reaction of the group?
  • How well did the group cope with this challenge?
  • What skills did it take to be successful as a group?
  • What creative solutions were suggested and how were they received?
  • What would an outside observer have seen as the strengths and weaknesses of the group?
  • What roles did people play?
  • What did each group member learn about him/her self as an individual?
  • What other situations (e.g., at school, home or work) are like the Helium Stick?

Negotiation Team Game

Negotiation Auction Game

In the Negotiation Auction Game an amount of money is auctioned to a room of players. We recommend $10, but the game can be run successfully with either $1 or $100 ($100 is recommended only if your room consists of executives). For the purpose of this negotiation game, we are going to assume an auction of a $10 note. Start at 5% of the value – so in this example ask for a bid of 50 cents.

The twist in this negotiation game is that the highest and second highest bidders must both pay their final highest bid amounts; but only the highest bid wins the $10 prize money. Many negotiation skills training courses use this negotiation game near the start of the course.

What normally happens?

In the overwhelming majority of games, both the highest and second highest bidders will pay in excess of the amount you’re auctioning. In many cases you’ll collect in excess of $100 from both parties! (i.e. $200 in total) Bids normally start off from all 4 corners of the room, rapidly pushing the price up from 50 cents. Between the $5 and $10 range, you’ll normally have just 2 players left in the game. You’ll likely get a laugh from the room when bidding exceeds $10. You won’t need to prod either player to carry on, but you can question them and give them extra time to consider before ending the negotiation auction by counting down from 3 to 1.

Why pay so much?

  1. Players are attracted at the prospect of winning $10 for a small upfront investment.
  2. Players are later trapped near the $10 level by not wanting to lose their $10 bid. They hope that the other side will back down after they place their next bid, allowing them escape with a minimum loss.
  3. Ego also plays a role – with neither side wanting to back down in front of their colleagues. The limbic emotional part of the players brains overrules the higher thinking cortical part of the brain.
  4. Additionally, we want to remain consistent with our earlier commitments. Backing down would mean admitting that we were fools to enter the bidding war in the first place. Often this results in winning at any cost.

Lessons

Although the game is fun, the lessons extracted in the discussion afterwards are where your gold lies. Discuss the above 4 motivators.

  • Ask how the irrational escalation could have been avoided early on.
  • Ask how the position could have been minimized at the $10 level. It’s likely that players will suggest ideas such as a quick discussion between the 2 highest bidders whilst the auction is still open, with an agreement to share the winnings and an end to bidding.
  • Ask about the various meanings that ‘winning’ can have.
  • Ask how these lessons apply to your organization’s negotiations and difficult relationships.

Ethics and Fairplay

We recommend that after your group discussion, you donate the excess money collected to your favorite charity (Please choose a worthy charity, and not a drug company’s cancer research project). By donating to a charity organization, your facilitator will gain trust and not risk being resented for having personally benefited.

Leadership Thinking

A glimpse on the life of Steve Jobs

Steve Jobs is one of the most successful leaders in business history. His company Apple created the Apple 2, Macintosh, iPod, iTunes, iPhone, G5 and the iTouch. In addition Steve purchased Pixar Animation from George Lucas which brought computer animation to the big screen in a big way, including Toy Story, Finding Nemo, Monsters Inc., a bugs life, Cars, Ratatouille, Wall-e, and many more. The follow commencement address by Steve Jobs provides interesting insight into the thinking of this successful leader.