The X factor of leadership: Decoding traits of a good leader

Every business model needs an extraordinary leader who makes that important link from excel sheet to customer value proposition and between the numbers and the big idea

Published: Jan 23, 2015 06:56:52 AM IST
Updated: Jan 22, 2015 03:50:00 PM IST
The X factor of leadership: Decoding traits of a good leader
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As a search consultant, I am often asked – how do you recognise a good leader? What’s the one trait they must possess?

Well, by one measure, it’s rather simple identifying a brilliant candidate – it’s anyone who doesn’t resort to cold numbers to solve a problem. Corporate history is littered with CEO’s who were remarkable at using complex quantitative models to explain business strategy. But the final transition from good to pure genius has almost always lain in the ability to abandon numbers and embrace chaos. Moving from the precise world of financial ratios and performance metrics, to a space where the narrative is paramount. Wherein, the ability to grasp ambiguity and show strategic clairvoyance is a vital tool in everyday decision making process.

The rationale is straightforward. At the C-suite level, excellence is commoditised. Several leaders you meet at the top echelons of billon dollar conglomerates are very good at what they do. That’s how they got there in the first place. They quickly realise that missteps are rare, making them noticeable. And predictably, the preparation and practise that goes into masking one’s shortcomings is immense.

It reflects in their behaviour. You’ll notice most leaders find it simpler negotiating an analyst meet, debating margins and CAGR (Compound annual growth rate), than sitting down for a free-wheeling strategy session that challenges business model, customer engagement strategy and value proposition. Few enjoy it. Fewer still emerge credible at the end of it.

And it’s easy to comprehend why. Numbers, sadly, don’t face up to adversity easily. When you torture them hard enough, they will confess to anything. Every statistician, private equity or M&A professional, grappling with complex financial models, will concur. Any project can be made to look interesting, if NPV (net present value) and IRR (internal rate of return) were sole data-points to consider before investing in an idea.

Indira Nooyi, CEO of PepsiCo put it pithily– ‘the minute you've develop a new business model, it’s extinct, because somebody is going to copy it’. The construct gets replicated. Soon it’s cheap, accessible and shared hand over fist at every business school and corporate entity in the neighbourhood.

Ideas, on the other hand are most resilient to scrutiny. Whilst they can be twisted, contorted, cajoled and burnished to the bone, there will always be grey space – a void that calls for a leader to fill, with little else than common sense, acumen and experience at their disposal.

To keep it meaningful, every business model requires an extraordinary interlocutor. A leader who makes that important link from excel sheet to customer value proposition. Between the numbers and the big idea.

Nothing supplants the need for the most lucid of explanations – what does my customer really want? How do I become more relevant to them? Can I make my organisation more adaptive? Will my corporate strategy survive multiple generations of customers?  Questions, which few leaders manage to answer with conviction. And, this is a small and rare tribe who, needless to say, are vigorously pursued by the head-hunters across the globe.

It’s neither a new school of thought, nor a recent phenomenon. Examples abound across history. Both within and outside the corporate space. Einstein spent years conjuring up the most complex theorems the world had witnessed. Yet, his explanation for perhaps the most popular of them (theory of relativity) leant on the simplest of props – a burning stove and a pretty lady.

In recent times, Steve Jobs must receive a disproportionate amount of credit for having best illustrated this characteristic. He took an intricate web of hardware, algorithms and codes to deliver the most astounding of range of products. Ones that were difficult to create, incredibly intuitive to use and easy to explain.

Jobs had swept up a host of disparate technologies back in the day (hand-phones, online music sharing, content copyright, amongst others) to cobble together a game-changing portfolio that lead to the creation of US$ 200 billion gorilla, with a US$ 650 billion market cap. Apple didn’t necessarily invent each of these technologies from scratch. Jobs merely joined the dots and focused sharply on the narrative. Therein lay his genius and the identity of an outstanding leader.

Test the hypothesis and you’ll find every exceptional corporate leader of the past and present fit the template. Jack Welch, Lou Gerstner, Warren Buffet, Richard Branson, Jeff Bezos, Ratan Tata. None of them were known for their mastery over numbers. It was their ideas that defined them.
For the trick is to be a prodigious composer – one who tears up the music sheet shortly after the song is inked. Knowing fully well, that the magic lies in the ability to master the piece by ear. Just the way, the audience would listen to and appreciate it. Intuitively and by instinct.

(The author is a London based consultant with Positive Moves, a cross border executive search firm. The views expressed are personal.)

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