By Andrew Yenchik
Determining the strategic capabilities – and the leadership
to execute them – will always remain difficult to determine and essential for
growth. The McKinsey Quarterly’s
insights regarding the link between a firms growth and the traits their leaders
posses initiates an interesting discussion.
McKinsey’s research found that leadership quality is essential for
growth, and that most companies don’t have enough of the high quality
executives that they need. [1] In addition, Palladium strategists Donlon and
Walmer remind us that setting strategy should come first, then defining capabilities,
and then the choosing of leadership to execute the chosen strategy. [2
Therefore, form
(the executive leadership and their traits) should follow function (determined strategy and capabilities).
But is this “form follows function” methodology always the
case? It sounded good as I read these
articles; therefore, I explored a few strategic leadership examples from the
recesses of my mind just to make sure.
Jan Carlzon at SAS
When Jan Carlzon took the helm at SAS in 1981, the airline
was hemorrhaging $20M a year, had an international reputation with extreme
lateness, and was the epitome of a rigid, centralized, and slothful
organization. Carlzon turned SAS into an
international sensation in just a few years, focusing relentlessly on customer
service, quality, and timeliness. He
turned a centralized snail into a lean problem-solving machine, giving
frontline employees the power. [3] However, prior to Carlzon, SAS’s strategy
and capabilities were focused on increasing technology and defending against
rivals. [4] It appears that Carlzon’s ideas and personality set the strategy
for SAS – which turned out well. Did
form really follow function? Or did
function follow a dynamic and intelligent form?
Steve Jobs at Apple
When Apple purchased NeXT in 1986, Steve Jobs returned to
the company he co-founded. He became CEO
the next year and began to put into motion his “Think Different” strategy. He terminated projects (Newton, OpenDoc, and
Cyberdog) and people that didn’t align to his strategy. [5] Under Jobs’
leadership, Apple developed iTunes, the iPod, the iPhone, and countless other
game-changing innovations. But before
Job’s return, Apple was floundering without solid direction, strategy, and
capabilities. A charismatic, brilliant,
and stubborn Jobs rebuilt Apple upon his seemingly “cult of character.” Moreover, Jobs is famous for quotes such as “A
lot of times, people don't know what they want until you show it to them” and “We
never hire consultants, per se. We just want to make great products.” [6] [7]
Again, I ask, did Apple purchase NeXT or bring back Jobs due to execute well-designed
strategies and capabilities? Did form
follow function?
To me, these two limited examples show the blurry lines
between form and function, and which follows which. In the political arena, function often
follows form. A particular candidate,
armed with platforms and ideas (a strategy and capabilities, per se), is
elected to office and then sets out to install those ideas and strategies. It appears that academia and research lean
towards the opinion that form should follow function, in the broad sense. But what about these two historical examples
of function following form? Has academia
and large databases running complex Hadoop queries missed the mark?
Steve Jobs and Jan Carlzon both possessed the needed
competencies to lead their firms, design a lasting strategy, and engender a
legacy. McKinsey did get one thing right
– that certain competencies of executives and leaders are more important to
some strategies than to others. [1] I take that one step further and say that
certain competencies of executives and leaders are more important than current
or future strategy for a firm. Find the
right guy, and your strategy and capabilities will follow.
Vivint
A final example of a firm that appears to understand the
dynamic relationship behind form and function – strategy and leadership – is
Vivint. Vivint is a home automation and
home security company that utilizes a door-to-door sales force. Vivint was formerly APX Alarm, an alarm
company that had began to decline due to leadership and money woes. Alex Dunn, Governor Mitt Romney’s former
Chief of Staff, was brought in as President, along with a list of other highly
accomplished executives. This team
rebranded and restarted as Vivint, and huge success and growth has
followed. Blackstone Group acquired
Vivint in 2012 and Forbes recognized them as one of America’s Most Promising
Companies for 2013. [8] Moreover, recent hire Matt Eyring, former managing
partner at Innosight and renowned innovation strategist, made headlines and
also made success for recent Vivint spin-off Vivint Solar. [9] From my view, it
appears Vivint has used strong leadership, possessing key competencies, to
build strategy and capabilities that they can successfully execute.
So what do you think – does a successful firm set a strategy
and then find key leaders, or do they find key leaders and then set a strategic
course? History seems to favor the
later, while academia favors the former.
What came first, the chicken or the egg?
[1] McKinsey Quarterly, July 2011, “Do you have the right
leaders for your growth strategies?”
[2] Donlon and Walmer, “Does Your Organization Have the
Capabilities to Execute Its Strategy?”
[3] Janz Carlson, http://en.wikipedia.org/wiki/Jan_Carlzon
[4] Richard M. Burton and Borge Obe, “Strategic
Organizational Diagnosis and Design: The Dynamics of Fit”
[5] Steve Jobs, http://en.wikipedia.org/wiki/Steve_Jobs
[8] Vivint, http://en.wikipedia.org/wiki/Vivint
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