HOW DO CEOs MATTER?


The June, 2009, issue ofThe Atlantic Monthly had a provocative article entitled “Do CEOs Matter?” by reporter Harris Collingwood. What prompted it was the recent story about the leave of absence taken by Steve Jobs of Apple Computer and the stock market reaction to stories by Jobs’ health problems.

As a former CEO, and as a student of leadership in business and other sectors of our country, I believe that individual leaders matters at all times, but in varying degrees at different times and under different circumstances. Certainly, at particular points in an organization’s history, there are crises that demand unique leadership capabilities. For example, I cannot imagine that IBM or Xerox would have survived the threats to their survival in the 1990′s without the inspired leadership of Lou Gerstner and, in Xerox’s case, the inspired leadership of my good friend Ann Mulcahy.

However, the goal of a successful CEO is to create sufficient breadth and depth of leadership that he or she can exit without affecting the strength of the organization. That was the whole point of Jim Collins’ discussion of Level 5 leadership in his great book From Good to Great. Collins argued that the best leaders create organizations so strong and resilient that the organizations can prosper without them.

When I think of my CEO tenure at Pitney Bowes, I think of three decisions that required my unique leadership capabilities, the decision to take a strong stand against the U.S. Postal Service leadership in place in the mid-1990′s, the leadership on postal reform legislative advocacy from 1995 through 2006, and the decision to persuade our board of director to exit our non-core financial services businesses. All those decisions would not have happened as effectively without me.

On the other hand, I was blessed with inspired leadership from many levels of Pitney Bowes people, and, while I gave a unique twist to other decisions, I believe that there were others who could have crafted a successful direction to the company relative to those decisions. By 2007, I was highly confident that the Company could be successful under Murray Martin’s leadership, and recommended that he succeed me. Having seen his great leadership as CEO for two years, I feel that my recommended has been validated.

I am glad that Mr. Collingwood and The Atlantic Monthly have chosen to do this story because I feel that, as a society, we often succumb to the myth of the celebrity leader. We overvalue certain high-profile leaders who appear to be dominant leaders, and we undervalue lower-key individuals who succeed by building broad organizational capabilities. We overpay those so-called great leaders, and, then, get bitterly disappointed when they are less than superhuman. The boards of directors that get caught up in this cult of the great leader are most to blame, but, clearly, shareholders have to look in the mirror and see if they contribute to the problem by over-reacting to a report on the health status of a single individual. When boards see significant shareholder reaction to information about a leader, their potential ability to look for the quick-fix leadership solution is reinforced.

Great leaders make a huge difference, but, paradoxically, their biggest contribution to an organization is to create an environment in which they are not needed for the organization’s success.

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