Issue Focus: Leadership
Making the Case for Leadership
Five alumni protagonists step out from the pages of HBS case studies to share their experiences and ideas about the successful exercise of leadership.
Leaders come in all colors, ages, shapes, and sizes, with all manner of skills and temperaments, a variety and diversity seemingly matched only by the real-world challenges they must confront. In recent years, that expanding pool of leaders has been captured in an ever-broadening and deepening body of HBS case materials.
The study of leadership, like everything else at HBS, begins with the case method. In the pages that follow, five alumni, whose leadership skills have been examined under the case-method microscope by thousands of HBS students, tell it like it was and relate what they’ve learned and what they believe about being a leader.
Putting Her People First
A standout high-school student-athlete who turned down Ivy League schools to attend West Point (its education of the total person beyond academics appealed to her), Toby Johnson (MBA ’07) was deployed to Baghdad as an Apache helicopter pilot and staff officer during the Iraq War. Reaching the rank of captain while serving as a battalion adjutant in charge of all personnel matters, Johnson won raves from superiors and subordinates alike. Whether leading soldiers or civilians, Johnson strives “to put my people first.” She believes leaders cannot be successful unless they show vulnerability, are consistent, take time to be balanced, have a vision, and embrace their role as decision-makers.
In the 2010 case “Toby Johnson: Leading After School,” Johnson, with military service behind her and MBA in hand, is sent to PepsiCo’s Frito-Lay plant in Williamsport, Pennsylvania, to introduce a new pilot project designed to enhance the motivation and performance of a group of 200 employees. A rare female manager at Frito-Lay, Johnson finds that her youth, inexperience, and outsider status, not her gender, are hurdles to be overcome to win the workers’ allegiance. She does so in part by meeting one-on-one with every employee and introducing innovations such as pairing a shift worker with a manager in coleadership roles.
“This is an unusual case because it’s about an MBA in her first job,” notes the case’s coauthor, HBS professor Boris Groysberg. “At Williamsport, Toby worked to understand the organization and get the employees involved, so when it was time for buy-in and action, they were ready to go. She’s a high-potential leader.” And an open-minded one as well: “I learned that I need to be a better listener and more understanding, especially of my peers,” Johnson says of the experience, which in the end was a resounding success.
In the case, Johnson privately wonders if she can transition from the intensity and engagement of “defending freedom” to “producing snack food.” To her surprise, she found employees’ concern for their workplace “unit” similar to military life. “A driving motivation among the frontline workers was not letting down the people around them,” she explains. “Leading in a civilian setting is not unlike in the military: if you do your job well, you can change people’s lives for the better.” And it’s all about empowerment. Says Johnson, now a senior executive at PepsiCo in New York, “Coming to work and doing no harm is very different from coming to work and changing the way people perceive themselves.”
A Leader for All Seasons
The case “Corning 1983–96: Transition at the Top,” written in 2001 by HBS professor Michael Tushman and senior lecturer Mike Roberts, opens with Jamie Houghton (MBA ’62), the great-great-grandson of the company’s founder, taking over the corner office of his family’s firm. After a grooming process begun at a Corning lightbulb factory in Kentucky, his mission is clear: lead the venerable but technologically innovative company away from specialty glass, television tubes, and fiberglass production into newer, faster-growing profit-making areas.
At the time, the economy is plagued by recession, worker morale is flagging, and the company is falling short of its operational goals. Leadership is needed. So how did Houghton, who would become renowned for his inclusive, team-oriented, nice-guy leadership, get everybody’s attention? “I hit them over the head with a two-by-four and said, ‘Here’s what we’re going to do,’” Houghton recalls with a smile. That included instituting total quality management, still a novel concept in that era, a move that initially met resistance. But because TQM forced company-wide excellence in everything, not only in product quality, “It was one of the best things I ever did in a leadership role, and I’m proud of it,” Houghton says.
Houghton renewed the company’s culture on three cornerstones: quality, performance, and valuing the individual employee. As for strategy and the bottom line, the commercial areas he focused on were the medical-services business and the fiber division—even though fiber was losing $12 million annually—because Houghton believed a fiber-optics revolution was coming. His hunch proved right, the company flourished, and Houghton retired after a successful 13-year tenure.
But then came perhaps an even greater challenge. With the telecom meltdown and the bursting of the high-tech bubble, Corning’s stock sank from $113 a share to around $1 a share in two years. With the company’s survival in question, Houghton was called back as CEO in 2002. This time, leadership required lifting spirits, not dropping the hammer. He exhorted his employees (“We will succeed”) while encouraging and relying on the very executives many thought had laid the company low, making this one of his finest leadership hours as he oversaw Corning’s return to stability.
A former board chairman of the Metropolitan Museum of Art and former (and longest-serving ever) member of the Harvard Corporation, Houghton believes a leader must “define reality, articulate the vision and set the strategic path to it, enshrine the institutional values, demand performance, empower the people, and then get out of the way and say thank you.” A leader should also be a good listener, encourage a team culture, and be willing to make mistakes.
Humility is important, too: as Houghton once wrote (paraphrasing Justice Learned Hand), “Perhaps the spirit of leadership is the spirit that is not so sure it is right all the time.”
Leading from the Middle
HBS professor Linda Hill approached Taran Swan (MBA ’91) in 1998, after reading an article in Essence magazine about the up-and-coming general manager of Nickelodeon Latin America. “I was interested in the entertainment industry and globalization,” Hill recalls. “The article was about the business, not how she led.”
So how did “Taran Swan at Nickelodeon Latin America” become a perennial favorite in first-year LEAD and any HBS Executive Education program where leadership is discussed? The case, first published in 1999, hinges on a decision that wasn’t even present when Hill started her research: Diagnosed with a high-risk pregnancy, Swan must return to her home in New York for mandatory bed rest. What adjustments should she make to lead remotely, and what tweaks (if any) should be made to her Miami-based management team?
The case details the numerous challenges Swan initially faced in launching Nickelodeon Latin America, from winning over skeptics at corporate headquarters, to creating a programming vision, to recruiting and motivating a growing team of employees (some of whom, like Swan, were commuting from other cities at the time). Also in play: managing a tight, closely watched budget while walking the line between advertising sales and quality children’s programming.
“You start to see what does and doesn’t work,” remarks Swan, who read everything on leadership and managing she could get her hands on. “I insisted that we were all running the business together. It was a matter of knowing each person and what he or she really wanted out of his or her career. If I could figure that out, I could really excite and empower people to do great things.” Hill notes that many of the people under Swan eventually got big promotions that reflected how much they were able to learn, adding, “Taran created capabilities in the organization that are key to innovation and competitiveness. Their team knows how to have an intellectual debate; how to advocate and inquire; and how to make big bets, take in information, and make adjustments.”
After being ordered to bed for the remaining five months of her pregnancy, Swan continued to work 60-hour weeks out of her New York City apartment. She appointed joint interim directors, asking them “to step up and take more responsibility,” and gave more authority to her executive assistant to act as a gatekeeper for issues as they arose. “My number one thing is that I didn’t want to slow anything down,” Swan remembers. “I knew the team I had in place was capable. With every job I took, I figured out who could take over for me before I even started. Succession planning was an absolute.”
Swan left Nickelodeon three years after giving birth; now the mother of two daughters, she is an independent management consultant spending most of her time as an executive coach, a career that evolved from an assignment working with the head of the Cartoon Network. “Basically, I’m helping other people develop stronger leadership and management skills,” she says. In addition, she and a partner run Media Fix (www.gomediafix.com), a consultancy with a focus on digital strategies for businesses targeting kids, women, and moms.
“It’s funny, until Nickelodeon there was never anything I did as a student or in my work life that suggested I might have leadership abilities,” Swan reflects. “The real secret is that I found something I really, really love. That’s when the courage to take risks came out—because I was so excited about what I was doing.”
Unleashing Employee Potential
Is it possible to run a successful multinational IT services firm where employees are treated like an extended family and strategy emerges from the bottom up? Those are the key leadership questions posed by Professor David Garvin’s 2010 case, “Zensar: The Future of Vision Communities.”
Student reaction to Zensar’s unusual corporate culture “started with extreme cynicism,” recalls CEO Dr. Ganesh Natarajan (AMP 169, 2005), who recently joined Garvin as he taught the case in the elective General Management: Processes and Action. “But by the end of the class it was, ‘Wow, this is the only way to make it work.’ ”
A decade ago, Natarajan took the reins of Zensar, an ailing software company based in Pune, India, with the challenge of charting a profitable future. Almost immediately, he set a new tone of employee participation resulting in a trajectory of sustained growth.
As noted in the case, Natarajan “built an organization that was much like an extended family—one in which he knew employees personally, involved himself deeply in their lives, and adapted his style to suit each individual.” But being “warm and fuzzy” doesn’t mean being soft on performance. “However nice I am to employees, if they don’t deliver, they go. I think that is pretty clear to everybody,” says Natarajan.
Natarajan led the company’s turnaround by instituting an annual Vision Community exercise, which invites selected employees at all levels to join in brainstorming sessions to identify ideas that could lead to new products and services. “Eighty percent of our success over the past decade has been based on bright ideas that came not from me or my management team but from very young people in the organization,” he says. The case ends as Zensar charts an ambitious acquisition plan. Students are challenged to consider whether a larger, more diverse organization can maintain its unique attributes. Two years down the road, Natarajan answers in the affirmative.
As Zensar has acquired IT firms in Boston, New York, Tokyo, and Hyderabad, it has spread its inclusive culture. “People are people; it doesn’t matter which nationality or which culture,” says Natarajan.
“It’s not really a textbook leadership style,” he concedes. “When David [Garvin] first presented the case and talked about how we run a company through love, the students said, ‘Oh, my god, are you crazy? What about the shareholders?’ But getting students to understand that our connected style can help us win all the deals we want and get all the business results our shareholders want, that’s really the broad concept here.”
Nor has growth stymied the Vision Community exercise. It remains vital to unleashing the power of ideas. “We have always believed that empowered people and a compelling shared vision build great companies, and Zensar’s success is a visible result,” says Natarajan.
Mayor for Life
“It was a hellish month,” says Kent “KT” Thiry, describing a period of deliberation in 1999 before he accepted the CEO position at Los Angeles–based dialysis provider TRC. Thiry (MBA ’83) had just completed a difficult, ultimately unsuccessful term as CEO of another health care organization. After that experience, he pledged to join his wife, Denise O’Leary (also MBA ’83), in transitioning to less demanding roles on corporate boards and in the nonprofit sector. Thiry’s decision to take the new job threw that plan out the window but led to the renaming of TRC and a new organization, DaVita, which he describes as “a community that happens to be organized in the form of a company.”
In the 2010 case “Kent Thiry: ‘Mayor’ of DaVita,” Thiry explains, “The incredible tension around the decision, which felt like a burden at first, was actually a gift, because I went into the job with a stronger sense of purpose than ever before in my career.” That reckoning, and an accompanying search for deeper meaning, brought Thiry to this epiphany: “At some point you have to decide if you want to be a business leader or a life leader. A business leader might be able to achieve business outcomes. But that’s only a subset of what you aspire to as a life leader, who ensures that how you get to the business outcomes enriches people’s lives and strengthens communities.”
DaVita’s focus on a “village” culture whose citizens (employees) help and care for one another may be too touchy-feely for many MBA students, says the case’s author, Professor of Management Practice Bill George. Indeed, Thiry’s call-and-response chants at company gatherings will remind some (uncomfortably) of a revivalist preacher. “People might think this guy’s not real,” George remarks. “But remember, he went through some hard times in previous jobs. This approach came to him over time.”
In fact, the case’s decision-point rests on the question of whether to integrate thousands of skeptical employees from Gambro, a recent acquisition, into the DaVita culture. “A lot of them had heard about people singing songs, so they had negative perceptions,” Thiry comments.
As it turns out, he continues, hundreds of informal interactions between DaVita and former Gambro employees were more effective than any integration or separate-but-equal strategy concocted by senior management. “The Gambro dialysis tech would say, ‘Hey, what’s all this weird stuff about village and community?’” Thiry says. “A very high percentage of our teammates said that it was just our way of communicating that we want this to be a good, healthy place to work.” Achieving that buy-in comes from an explicit, public focus on that goal, incorporating creative employee ideas about how to achieve it, he adds—all backstopped by hard metrics to track company-wide agreement with a given approach.
Thiry often visits the HBS classroom when the DaVita case is discussed in the second-year course Authentic Leadership Development. “There’s a real intellectual curiosity about leadership,” he observes. “Is it just a set of techniques for motivating people, or is it a way of life? You also get the inevitable and appropriate skepticism to our approach,” he admits. “What I love about HBS is that people have the courage to bring it up.” By the end of class, says Bill George, Thiry is leading the students in a cheer.