Something surprised me the other day. It was the reason a colleague, who had left to work for a big company (sniff!), returned to ghSMART.
She had left a couple of years ago to become a senior executive at a top-tier fashion brand.
Sounded like a dream job at the time. But within 2 years, she returned to our firm.
I was happy she came back; but what was a mystery to me was why she decided to come back. She sat down next to me at our firm’s annual Summit.
I said, “Hey I’m so happy you are back!”
She said, “It’s great to be back. It’s a relief actually.”
“A relief,” I asked? “How so? How did you decide to come back I wonder?” I laughed, trying to not make her feel uncomfortable.
She paused. “The real reason is our culture of freedom here at ghSMART. It’s not like that in Corporate-land.”
“What’s it like in Corporate-land?” I asked.
“Well,” she chose her words carefully, to be respectful to the employer she was leaving, “There was no freedom. Meetings, meetings, meetings. And if anybody above me, or below me, called a meeting, I had to be there, as their culture requires. It’s like nobody trusted anybody to think or act on their own! Everything was by committee. Drove me nuts. But here at ghSMART, we don’t have that culture. We are way more empowered to make decisions, to use our talents, to team up with colleagues when it makes sense, or to take initiative and make things happen for our clients.”
Her story made me feel good. As Chairman & Founder of ghSMART, one of my two big goals for starting our company was to provide a career “home” to exceptionally talented people. (The other goal was to satisfy an unmet need in the market—to help leaders pick great teams and help those teams be successful.)
Anyway, I remember making a key decision about culture. It was the decision of whether to hire not-so-smart people, and box them in with excessive meetings and processes and bureaucracy to limit their ability to do damage. Or to hire smart people, as in ridiculously smart and capable people, and give them the freedom to make choices.
- To choose what clients to serve, what types of problems to help them solve, and how to help our clients achieve their goals.
- To choose their own career path at the firm.
- To choose what colleagues to work with.
I chose the path of “talent and freedom.” It made a lot more sense to me.
But where did this decision come from? It’s not original. It came from watching some of the best CEOs in the world hire the best, and give their people an unusual level of freedom to make decisions. I remember having respect for the CEOs of the Ritz Carlton or Four Seasons, where employees can make decisions to spend as much as $10k+ to fix a guest’s problem, without having to ask permission. I remember respecting Sir Richard Branson and his culture of “fun” at Virgin (which today owns over 300 businesses) which relied on giving employees ample room to be creative and take initiative to make customer experiences special. And I recall hearing stories about Nordstrom’s “Employee Handbook” which consisted of a single card that read, “Use good judgment in all situations.” How awesome is that?
A mark of truly excellent CEOs is the ability to hire super talented people, and then give them freedom of choice.
But why don’t more CEOs and leaders hire the best, and give them freedom?
It takes a lot of confidence to hire people who are smarter than you are. Insecurity is why few CEOs can’t stand to have smarter people in the room.
It takes a lot of discipline to hire people who are well-matched for their jobs and for the culture of your company. A lack of discipline in hiring is a reason why few CEOs build really talented teams.
It takes a lot of humility to resist the urge to second-guess your colleagues. That’s why few CEOs can handle the idea that the great ideas and decisions are not coming from them, but from their colleagues.
And today, I have great respect for the CEOs of Google, Facebook, and IDEO, who do a great job of hiring top talent, and then giving them a high degree of freedom to make magic happen for customers.
On the flip side, I’ve also seen so many examples of bad CEOs taking the opposite approach—hiring so-so talent and then boxing in their freedom. A board brought us in to advise on CEO succession. The incumbent CEO was such a control-oriented guy, he would insist on doing all of the talking at board meetings. And he would say “SHHHHHHH” loudly to his senior executives and other board members, who were in the room if they spoke up.
I witnessed a private equity firm who called the management team of a global business services company he owned every single day, to check up on them, second-guess their decisions, and to tell them exactly what to do. That investor lost 100% of his investment in that deal.
I remember another CEO of a pharma company who loved to show everybody how smart he was by finding mistakes his employees made, and then talking about them publicly in meetings to “shame” his leaders into blindly following him.
I remember another struggling CEO of a tech company who would say “yes but” after nearly anything his colleagues said in meetings; he was constantly “correcting” them, but it really shut down their confidence to take initiative or use their own judgment.
Finally, in our work advising government leaders, and military leaders, the ones who struggled the most, we would find, hire poorly and act like autocrats.
The best leaders were able to attract the best talent, and give their colleagues a high degree of freedom to make decisions—life and death decisions—swiftly and effectively.
And if you think this advice is useful, please download our free leadership tools at SMARTtools for Leaders™.