On the Edge of Failed Leadership: Start-up Mentality and Desire

Minolta DSC

I recently watched a profile on 60 Minutes that profiled the author Alison Levine which motivated me to blog on some important insights into leadership. In case you don’t know her, Alison is the author of the New York Times best-selling book, “On The Edge”. The Edge reflects on the lessons learned from her various expeditions, making the case that the leadership principles apply in extreme adventure sport also apply in today’s extreme business environments.
Her accomplishments are impressive. She has skied to both the North and South Poles—a feat known as the Adventure Grand Slam, which fewer than forty people in the world have achieved. In January 2008, she made history as the first American to complete a 600-mile traverse from west Antarctica to the South Pole following the route of legendary explorer Reinhold Messner. Levine completed this arduous journey on skis while hauling 150 pounds of her gear and supplies in a sled harnessed to her waist. Her success in extreme environments is noteworthy given she has had three heart surgeries and suffers from Raynaud’s disease, which causes the arteries that feed her fingers and toes to collapse in cold weather—leaving her at extreme risk for frostbite.
Now let me take you from leadership to desire. Chen Lizra defines Desire – knowing what you want and then going after it. It seems like an obvious definition but sometimes we all need to be reminded of the simple concepts and seeing these in plain English helps the brain to process these concepts. It’s my contention that Leadership and Desire are the two most important elements that make up a successful start-up. Those in leadership have to have desire plugged into company success metrics not their own selfish desires. I’ve been part of several start-ups over the past years and like Alison I learned that once you make a decision you can’t second guess yourself. This is the feeling she described when she reach safety after turning around before reaching the peak on one of her journeys. She did not consider this a failure but a learning experience.
The success or failure of your company will ultimately be based on your decision making and how the leadership team cultivates everyone to participate and everyone needs to feel part of the team, motivating by inclusion. The most glaring sign of impending failure is when what I call a ‘cult of personality’ is created. This develops when one person in leadership acts without governance and dictates decision making for the company unilaterally. Ultimately, these decisions will be based on his or her benefit not the company’s. One of Alison Levine’s rules of Leadership is simply, “Everybody needs to have skin in the game”, what I call the ‘skin factor’. This means that everyone needs to have shared risk in the company, which builds confidence and leadership. If you don’t feel that your leader/CEO shares similar risks as you, your company will most likely fail – think disparate pay. How can you follow someone up the mountain if they’re not shoulder to shoulder with you in some way?
I have many friends and former colleagues in the VC business and they all have said the #1 reason for company failure is executives who are usually legally paying themselves way too much for an unprofitable company burning cash. These are individuals who will not feel any pain if the company fails but gain as the company is failing, defying the primary rule of the skin factor in Leadership. They take what they can and if they company fails…so what. This doesn’t mean that everyone has the same compensation but relative ‘skin’ is required. So-called ‘Leaders’ focus of desire is financial not company success. We have seen throughout collective failed companies, once investors find out there are quarterly bonus checks being written to the CEO. I had a CEO tell me once when discussing funding options, “Companies don’t go public until profitable.” I didn’t know if I should laugh, refer him to the WSJ or begin a lecture. Then it dawned on me that there would be no public offering – that would require disclosure.
In summary, bad companies are led by the desires of poor leadership for financial gain. So, be mindful of the following seemingly obvious signs of failed leadership:
• Lack of financial transparency and overall corporate governance
• No budgets allocated to any key functions or departments, which allows for 1 person to control all functions (warning: Can be masked as, “I want to be involved with everything”)
• Important company decisions are made by President/CEO without conferring with anyone (see above: ‘unilateral decisions’) BTW – telling everyone how great a move is after the decision is made doesn’t count.
• CEO/President compensation beyond reason (see above: ‘quarterly bonuses’)

Journey Into Your Day

It was a journey.  That is what you will say at the end of your career, your life, your day.  Will that journey be something you will take you forever to relate and something that you can use to inspire others, perhaps your children, in ways that create a new direction and journey for them?  That journey is a day by day experience that transpires without any thought on our part.  Meetings and deadlines with goals attached to them are a part of your career and finding success

It’s amazing how each day we reorganize our priorities.  Which coffee shop to stop at? What to write in your Facebook or Twitter updates? When you woke up this morning what was the first thing you did? Check your smart phone, e-mail, FB, Twitter?


The 6-Month Rule


Driving Yourself Crazy & The 6-Month Rule


Question: I just started a new position and as you do, I want to make a difference in everything I touch in my career…like right away, right now!  How can I accomplish this without driving myself and everyone around me crazy?  This is a question that I hope to answer for you.

Firstly, it’s important to note, there is a new economy and changing business model of fast-paced companies with little loyalty delivered from the workforce that has been hammered with low budgets and high unemployment rates.  Companies have been hiring and firing and tenures are cut short resulting in employee fears and higher turnover rates.  Which I believe is as much a factor of the changing concept of employee-employer roles & relationships as it is the downturn in the economy.  The fact that the job marketplace has changed dramatically over the past 8-10 years should naturally change your approach to making a difference in your business, division, department or with your clients.

Think back to some of the positions that you have had in the past and the impact that you had on the business and the individuals in all of the departments that you have to interact with on a regular basis.  It probably has been a long and winding road to making an impact (see ‘making a difference’) that affects the business directly.  I’m not saying that patience is a virtue in pursuit of your career goals – it usually isn’t.  However, when it comes to gaining the trust of your co-workers and even your direct reports, you will need to take some small steps before the big ones and evaluate your performance in your 1st 6 months in valuable increments as opposed to sweeping “I changed the direction of business” type impact.

The bottom line is that a constant improvement of your skills and leverage in the company but steady and positive change that you can create in your new position is the way to go in your 1st 6 months!  This goes for consultants/service providers working with large clients – your value will be appreciated more as you provide your product but the big changes will come once you gain trust.  I have gone through this at different points in my career and it has worked very well.  Keep the points above in your head before you get too frustrated with your self-evaluation of the 1st 6 months you have been on the job…

Coming Soon:  “Channel Your Bubble Bursts”

CartBook in AZ

Having just moved to the Phoenix area I have had to make quite a lot of adjustments but the observations have been priceless at times.  I learned that the area is referred to as ‘The Valley” because that is physically where we live in a valley surrounded by beautiful mountains. Where I live in the valley of the sun is Old Town Scottsdale, which is the downtown section where you will find a concentration of restaurants and nightlife.  Old Town has been referred to as South Beach in the desert and if you have been to South beach, this is an accurate label.  Although, it certainly is not much by some other larger metro are standards, Old Town is kind of the middle ground between the South in Tempe where ASU resides and the high-end golf courses and resorts to the North.


Strolling thorough Old Town on a weekend, I noticed there were a lot of golf carts humming around making that noticeable noise from a low powered engine.  It seemed odd for a semi-urban landscape.  What was even more unusual was when a nice driver stopped to ask me if I needed a ride?  Why is she offering me a free golf cart ride – I said, “No thank you”.  I didn’t find out until later but this is a ‘free’ service where a cart will take you anywhere in Old Town free of charge just make sure you ‘take care of them’.  Witness, a multitude of cart-driven, 1 person entrepreneurs running through a 10-block radius.  Much like Facebook (FB), carts have grown organically where they will pick you up at your apartment or wherever you are at the end of the night.  Basically, existing on tip dollars and the faith that people won’t take advantage of them.  Judging from the amount of carts running around Scottsdale Thursday-Saturday, they are doing just fine. 10 years ago, we had e-mail but not FB.  Then Zuckerberg got the idea to setup a free social connection website was created and here we are still not paying for probably the most used site on the planet.  In new business terms, the system of creating something from nothing and charging nothing creates something of great value.  We all know in today’s new market, if you can get eyeballs or ‘users’ you need to give things away and value will come in getting that attention because people=value.  Just like getting a free ride to dinner in Scottsdale isn’t free but if you’re a user of FB or any of the other numerous ‘free’ sites.  Just think of it as a free ride that FB clients and shareholders pay for and provide to you!