not like it.” Ray Macdonald of Burroughs, Collins and Porras report, publicly ridiculed managers for mistakes to the point where he inhibited them from innovating. As a result, even though Burroughs was ahead of IBM in the early stages of the computer industry, the company lost out. The same thing happened at Texas Instruments, another leader in the exciting early days of the computer. If they didn’t like a presentation, Mark Shepherd and Fred Bucy would yell, bang on tables, insult the speaker, and hurl things. No wonder their people lost their enterprising spirit.
When bosses become controlling and abusive, they put everyone into a fixed mindset. This means that instead of learning, growing, and moving the company forward, everyone starts worrying about being judged. It starts with the bosses’ worry about being judged, but it winds up being everybody’s fear about being judged. It’s hard for courage and innovation to survive a companywide fixed mindset.
Andrew Carnegie once said, “I wish to have as my epitaph: ‘Here lies a man who was wise enough to bring into his service men who knew more than he.’ ”
Okay, let’s open the windows and let some air in. The fixed mindset feels so stifling. Even when those leaders are globe-trotting and hobnobbing with world figures, their world seems so small and confining—because their minds are always on one thing:
When you enter the world of the growth-mindset leaders, everything changes. It brightens, it expands, it fills with energy, with possibility. You think,
I’ve chosen three of these leaders to explore as a contrast to the fixed-mindset leaders. I chose Jack Welch of General Electric because he is a larger-than-life figure with an ego he held in check—not your straight-ahead naturally self-effacing growth-minded guy. And I chose Lou Gerstner (the man who came in and saved IBM) and Anne Mulcahy (the woman who brought Xerox back to life) as contrasts to Alfred Dunlap, the other turnaround expert.
Jack Welch, Lou Gerstner, and Anne Mulcahy are also fascinating because they transformed their companies. They did this by rooting out the fixed mindset and putting a culture of growth and teamwork in it place. With Gerstner and IBM, it’s like watching Enron morph into a growth-mindset mecca.
As growth-minded leaders, they start with a belief in human potential and development—both their own and other people’s. Instead of using the company as a vehicle for their greatness, they use it as an engine of growth— for themselves, the employees, and the company as a whole.
Warren Bennis has said that too many bosses are driven and driving but going nowhere. Not these people. They don’t talk royalty. They talk journey. An inclusive, learning-filled, rollicking journey.
When Jack Welch took over GE in 1980, the company was valued at fourteen billion dollars. Twenty years later, it was valued by Wall Street at $490 billion. It was the most valuable company in the world.
But to me even more impressive was an op-ed piece in
This vignette says a lot. Jack was obviously a busy guy. An important guy. But he didn’t run things like Iacocca—from the luxurious corporate headquarters where his most frequent contacts were the white-gloved waiters. Welch never stopped visiting the factories and hearing from the workers. These were people he respected, learned from, and, in turn, nurtured.
Then there is the emphasis on teamwork, not the royal
Instead, it’s “I hate having to use the first person. Nearly everything I’ve done in my life has been accomplished with other people.… Please remember that every time you see the word
Or “[These people] filled my journey with great fun and learning. They often made me look better than I am.”
Already we see the
Interestingly, before Welch could root the fixed mindset out of the company, he had to root it out of himself. And believe me, Welch had a long way to go. He was not always the leader he learned to be. In 1971, Welch was being considered for a promotion when the head of GE human resources wrote a cautioning memo. He noted that despite Welch’s many strengths, the appointment “carries with it more than the usual degree of risk.” He went on to say that Welch was arrogant, couldn’t take criticism, and depended too much on his talent instead of hard work and his knowledgeable staff. Not good signs.
Fortunately, every time his success went to his head, he got a wakeup call. One day, young “Dr.” Welch, decked out in his fancy suit, got into his new convertible. He proceeded to put the top down and was promptly squirted with dark, grungy oil that ruined both his suit and the paint job on his beloved car. “There I was, thinking I was larger than life, and smack came the reminder that brought me back to reality. It was a great lesson.”
There is a whole chapter titled “Too Full of Myself” about the time he was on an acquisition roll and felt he could do no wrong. Then he bought Kidder, Peabody, a Wall Street investment banking firm with an Enron-type culture. It was a disaster that lost hundreds of millions of dollars for GE. “The Kidder experience never left me.” It taught him that “there’s only a razor’s edge between self-confidence and hubris. This time hubris won and taught me a lesson I would never forget.”
What he learned was this: True self-confidence is “the courage to be open—to welcome change and new ideas regardless of their source.” Real self-confidence is not reflected in a title, an expensive suit, a fancy car, or a series of acquisitions. It is reflected in your mindset: your readiness to grow.
Well, humility is a start, but what about the management skills?
From his experiences, Welch learned more and more about the kind of manager he wanted to be: a growth- minded manager—a guide, not a judge. When Welch was a young engineer at GE, he caused a chemical explosion that blew the roof off the building he worked in. Emotionally shaken by what happened, he nervously drove the hundred miles to company headquarters to face the music and explain himself to the boss. But when he got there, the treatment he received was understanding and supportive. He never forgot it. “Charlie’s reaction made a huge impression on me.… If we’re managing good people who are clearly eating themselves up over an error, our job is to help them through it.”
He learned how to select people: for their mindset, not their pedigrees. Originally, academic pedigrees impressed him. He hired engineers from MIT, Princeton, and Caltech. But after a while, he realized that wasn’t what counted. “Eventually I learned that I was really looking for people who were filled with passion and a desire to get things done. A resume didn’t tell me much about that inner hunger.”
Then came a chance to become the CEO. Each of the three candidates had to convince the reigning CEO he was best for the job. Welch made the pitch on the basis of his capacity to grow. He didn’t claim that he was a genius or that he was the greatest leader who ever lived. He promised to develop. He got the job and made good on his promise.
Immediately, he opened up dialogue and the channels for honest feedback. He quickly set to work asking executives what they liked and disliked about the company and what they thought needed changing. Boy, were they surprised. In fact, they’d been so used to kissing up to the bosses that they couldn’t even get their minds around these questions.
