“It’s Not Prejudice, But …” Oh Wow.

Prejudice is a blindness. Here’s a perfect example, reported by Coco Liu in the South China Morning Post [SCMP] recently. (I’ve written about some great things – for example this – happening in the business world in China, but not today).

Luo Mingxiong is a venture capitalist. Please show some sympathy, as he is like a blind man who has decided that he also needs to insert ear plugs in case his senses happen to pick up any information that doesn’t fit with his pre-set ideas.

In January 2017 he made a presentation in Beijing, stating that “we usually don’t invest in female chief executive officers”, listing that factor as one of his top 10 reasons not to invest in a company, along with negative attributes like dishonesty and the inability to learn. He went further, declining in general to invest in companies with women on the Board even if the CEO is male. 

Why? 

“It’s not because of any kind of prejudice” he said. “But […] What do women do better than men, except giving birth?” And “Because it shows that the entrepreneur can’t recruit equally excellent and ambitious male executives.” SCMP “This Week in Asia” 22-18th January 2017.

Wow.

In which universe is that NOT screaming the word PREJUDICE? Blind & deaf, he’s leaving the field to much more discerning and intelligent investors. He’s been able to conveniently overlook the stream of statistical evidence that has emerged over recent years to show that companies do better with a balanced, diverse leadership. Here’s one major example. Oh, and here’s how this could add $12 trillion USD to global growth. 

My question to you, dear reader, is this: how can we respond when faced with this kind of wilfully blind prejudice? 

Do we sweep it under the carpet and pretend it has nothing to do with us? Do we prompt competing investors to grab the opportunities and demonstrate success? Do we actively seek such people out and attempt to challenge their world view? 

One powerful response is for those close to the individual – family, friends, colleagues, peers, even courageous direct reports – to express their own alternative view. Stand up, draw a line in the sand and refuse to allow such ‘alternative facts’ to go unquestioned. The earlier the better. 

Being wealthy or famous doesn’t make people right, or wise. 

Kung Hei Fat Choi.

Your Coach, Hugh 

 

Leadership Across Cultures: The Scorecard

Businessman Winning Race --- Image by © Royalty-Free/Corbis

Businessman Winning Race — Image by © Royalty-Free/Corbis

Would you imagine that Sub-Saharan African leaders would score highest globally on intellectual flexibility, on breadth of experience and on team development, but lowest on commercial thinking and on their ability to win hearts and minds?

Here are some similar highlights from research published in Harvard Business Review, May 2015 by Gurnek Bains (“Cultural DNA”) of global corporate consultancy YSC. Health warning: these are very broad brush statistics and will mask a lot of local cultural differences.

Latin American leaders? It seems that they lead the world by a mile on their level of drive and ambition, on being engaging and likeable, and on leading collaboration. But only 3% are strong in strategic thinking, and they have the lowest range of experience of any other region.

US leaders are the most action-oriented and also score highly in commercial thinking, but come at or near the bottom in the areas of intellectual flexibility & creativity, authoritative clear-cut leadership, self-awareness, emotional openness and authenticity.

Leaders in the Middle East are globally strongest in commercial thinking and are the most organised & structured leaders, with the strongest orientation to growth. On the other hand, they are beaten only by latin american leaders in the weakness of their strategic thinking.

Indian leaders have the greatest breadth of knowledge, and narrowly lead the rankings in authoritative, clear-cut leadership although these rank low everywhere. They are in fact much stronger in the area of drive and ambition, second only to the latin americans. Their biggest challenges are in the areas of positivity/ emotional resilience and in building relationships as likeable, engaging people.

Europe? Strongest in strategic thinking, in inclusive leadership and particularly in their visionary ability to win hearts and minds (this, by a large margin). They are also the least emotionally closed, with relative strength in perceived authenticity. However they tend to lack drive & ambition and rank low in action oriented thinking.

In China, leaders rank highest in analytical thinking, and have relative strength in their orientation towards growth, in drive & ambition, in being engaging & likeable, and in collaboration (ranking second globally in these areas). They score lowest globally in action-oriented thinking, and equal lowest in positivity/emotional resilience, and perhaps surprisingly in having authoritative, clear-cut leadership.

My Observations – First, I notice that most scores are lower than 50%, suggesting that most leaders lack most of these skills! There’s a lot of scope for development.

Second, while abilities in most areas vary widely, there is a universal lack of  strength in four areas:

  • Authoritative, clear-cut leadership
  • Self awareness and insight
  • Emotional openness and authenticity
  • Forming close, deep bonds.

So there should be huge demand for people like me who specialise in developing leaders! However the lack of self awareness among leaders is precisely why this isn’t always the case.

You have a choice – keep pretending you are doing well, or wisen up and grab a competitive advantage over a relatively weak field by finding a world class coach/mentor.

Every success!

Hugh

 

 

 

 

 

Business in China: The Haier Case Study

Zhang Ruimin 01Photo by Wang Jun Qd

 

In 1984 Zhang Ruimin stepped up and took over the leadership of the then state-owned appliance maker. Haier was close to bankruptcy. At one stage he had to borrow money to pay his staff. Now it is the world’s largest manufacturer of white goods, with revenue in 2013 of HK$224 billion (roughly AU$37 billion, or GBP19 billion).

Assumptions? China is a one-party communist state, and it has a reputation for discouraging people from thinking ‘out of the box’. Empowerment must be a dirty word. And leadership equates to authoritarian dictatorship.

So … how has Zhang achieved all this?

Let’s take one example, shared by Benjamin Robertson in the South China Morning Post. In 2014 the CEO and chairman warned his staff that 10,000 of its 70,000 strong workforce would lose their jobs. However, outgoing staff would be welcome back if they had a credible business plan. This is part of his long term strategy to turn the company into an ‘entrepreneurial platform’, which reminds me of Ricardo Semler’s radical strategies with Semco in Brazil (‘Maverick!‘ and ‘The Seven Day Weekend‘).

Employees, including senior executives, are expected to be part of product development teams, and pitch ideas to a committee which has the power to allocate start-up capital and resources. And former Haier staff can get company backing, using the Haier platform, while working for themselves. Zhang himself puts it this way: “We now have a lot of entrepreneurs at Haier who don’t work inside the company. Some aren’t interested in joining, preferring to stay outside in society, partner with the company, and use our platform for pioneering work. Those inside the company are also free to leave at any time, and still use the Haier platform for their work, though they would no longer actually work for the company. In the long run, there won’t be any company employees to speak of—only the Haier platform.” [strategy+business, Nov 2014]

Zhang also has a strong focus on quality. Staff still talk about how he handed out sledgehammers so that 76 faulty fridges could be pulped. 

Prof Bill Fischer of IMD Business School in Switzerland  wrote ‘Reinventing Giants‘, an analysis of Haier’s growth. He reports that “The thing we learned from Haier is that if you don’t have strong self-confident leaders at the top, you can never unleash the voices from below, because an unconfident leader is suspicious, threatened by people from below”.

So empowerment, engagement and entrepreneurship are clearly all core values in the company.

Fortune magazine ranks Zhang 22nd in its global list of people for energising their followers and making the world better. Meanwhile he is flattening this huge company to eliminate unnecessary chains of management and to speed up decision making. Decentralisation has gone to the extent that there are now 2,800 “counties”, each with 7 employees or less.

Art Kleiner, editor-in-chief of strategy+business magazine: “Every part of the organization has its own P&L, makes autonomous decisions (including which other parts of Haier to work with), and can reach out independently to customers, potential employees, and collaborators. R&D projects now often reach beyond Haier’s walls to include academics, independent designers, and even competitors. Zhang sees this as a natural evolution for all major companies, particularly those focused on business innovation in the Internet age.” And Haier aims to lead the world in making all of this work.

Zhang Ruimin has built a company without borders, a company without internal or external barriers, where change is now normal.

End users, other companies and even competitors are brought into the product development process. Haier’s expertise is openly shared: Alibaba spent HK$2.8 billion getting Haier to help build out its logistics network.

Where there used to be complete secrecy pending patents, now there is a greater value placed on collaboration to mutual benefit. Haier has a slogan “Forever honest” which means that there is now a culture of transparency.

Zhang again: “Those inside Haier, especially managers, understand that it’s crucial that we adapt to the evolving needs of users and the changing market environment. A few people who have gone from Haier to work for other companies have written to me telling me that the biggest difference between Haier and their new company is Haier’s transparent interpersonal relations. They say that this is unheard of at other companies”.

I contend that resilience is THE competitive advantage for the future, and Haier is a prime example. If you want help with building a resilient organisation staffed by resilient people, get in touch!

Every success,

Hugh

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