The health of Bill’s wife took a nosedive the same week that Sanjay was fired. Her most recent round of chemotherapy taxed her vital organs. One morning, after receiving a call, Bill rushed out the door. He followed the ambulance to the hospital, where his wife cascaded from crisis to crisis in ICU. Within three days, she lost her battle to liver failure. Just 27 years old, survived by a brother, two parents, and a broken-hearted husband. No kids.
November and the first part of December was a dark, difficult time. Everyone attended the funeral. For the employees of SparkLight Digital, it seemed to double as the company’s funeral. Work slowed to a crawl. Everyone struggled to adjust to the new normal and to confront the mismatch between work to be done and people to do it. Bill came back to work after two weeks but was a shell.
The departure of Sanjay and diminishment of Bill’s capacity killed productivity. At the worst possible time. The company’s cash position was insufficient to allow slippage, yet slippage there was.
You managed as best you could. You mobilized a search for a senior engineer to replace Sanjay. You audited everyone’s work assignments, looking for anything to deprioritize. Feature sets were trimmed back or pushed to the next release. Farook, who always operated at maximum capacity, couldn’t do more. Joe, already spending 90% of his time architecting and coding, couldn’t do much more either. The new engineers were junior, and while they tried to raise their contribution level, their skill limitations and loss of Sanjay’s mentorship took a toll. You felt stymied.
Then Vijaya came to the rescue.
Even though her role was technical product manager, Vijaya was also a solid developer. A graduate of IIT Madras, she was wicked smart and worked with high efficiency. First, she added almost 10 more hours to her heavy weekly work schedule. Then, breaking every rule of product management — a role dedicated to defining the details of product functionality from a business needs perspective, leaving the architecting and coding to a development team — she jumped right in and began to architect. This unleashed the productivity of the more junior engineers, who followed her clear architectural schema and focused just on coding. Vijaya introduced Joe to a couple of junior product managers she knew, and they came on board, quickly helping Beatrice with multiple bottlenecked product management tasks. Detailed product requirement docs began to roll more briskly off the production line.
And perhaps most significantly, after an email blast out to all her engineer friends, Vijaya found Foster, who agreed to interview for the senior engineer position. Foster was a rock star stuck in a failing company. Joe’s testing regimen to validate technical skill was rigorous, replete with high-difficulty problems. Foster nailed the test. You hired him the next day. He knew nothing about the code base, but jumped in right away and tried to contribute.
The hole was deep: the schedule two months behind. Everyone knew that it was crucial to recover lost time. Here it was mid-December; the holidays loomed. It was a rotten season for a mad-dash sprint to the finish line. Regardless, a new sensibility entered the Fieldstone Ford large conference room: grim determination. Everyone locked in. Quitting was a non-viable option.
The biggest surprise was Bill. Throughout his sad family saga, the company rallied around him, offering him unflagging support. His capacity to contribute in the midst of his ordeal was, of course, deeply compromised, but everyone understood and tried to pick up the slack. Then, about three weeks after his return to work, something changed. Bill began to come in early and leave late. His work was always of high quality, but now the output pace picked up. He resumed full responsibility for price quote product maintenance and bug-fixing, but also asked for — demanded, actually — some work assignments for the CRM. Within a week, he was doing the work of a half-time developer on the CRM product, while working full time on the price quote product. Bill was a highly qualified senior engineer; Joe was able to give him some complex problems. He attacked them with competence and vigor. It was a huge breakthrough.
Yard by yard, the project gained ground. The Tiger Team’s meetings were crisp and focused. Foster and Bill quickly assimilated into the team. What’s the status? What’s the bottleneck? What’s the next right priority? What feature can we defer to the next release? Who’s going to do what? Seven weeks behind. Six weeks behind. The dark clouds and emotional storms began to part. Confidence rose like a barometer.
On January 4, SparkLight Digital’s SparkAction CRM went live with four beta customers. For two weeks, the team was in crisis response mode, jumping on every customer support call, fixing bugs and working things out. The team was relieved to find there were fewer bugs than expected, and by the end of the two weeks, Joe gave the thumbs up to go into full launch.
All through that tumultuous Fall, as Joe and the Tiger Team worked hard to make the end of January launch date, you pounded the streets and phones, meeting and holding GoToMeeting calls with dealers in the Bay Area and beyond. In each dealer meeting, since the product wasn’t yet ready to demo, all you could do was describe the planned features, show mock-ups, and compare them to the dealer’s current capabilities. You teased out the dealer’s frustrations and showed how your new CRM might solve their problems.
Your objective was to line up 60 dealers who were interested and ready to buy, subject to a final demo. By this point, every single-store auto dealer in the Bay Area knew you by name. You visited multiple times. And many more dealers across the country encountered your numerous attempts to call in and find a decision maker. Despite all your efforts, you were only able to build your whiteboard list to 42 dealers ready for a full final demo meeting. Yes, each of these dealers seemed genuinely excited about the product, impatient for the chance to confirm promised capabilities. But 42 meant that for you to have thirty dealers live on the platform by February — the board’s stipulated minimum for A round viability — 75% of them needed to close. Unheard of.
Over the first two weeks of January, with the product still in beta, you scheduled and held the final demo-ready pitches. Two dealers bailed, but you pitched the remaining 40. The reaction was overwhelmingly positive. Some signed on the spot, some needed back-and-forth. But by the third week of January, you were in possession of twenty-seven signed one-year contracts. Included in that number were twelve of the original eighteen price quote customers, who converted from the price quote product to SparkAction CRM.
You gathered the team for an all-hands meeting. As you prepared to speak, you glanced around the room. Suddenly you felt a choke in your throat. Fourteen fellow warriors, ragged with overwork, all looked at you with anticipation.
“Converting a dealer off of their legacy CRM and onto a new one is a huge effort. I know you all worked incredibly hard for the past six months. All that work came at a big cost, and you probably feel like you already hit the wall. But our work isn’t done. We sold twenty-seven dealers. Now we need to get them live. And we don’t have much time. We need to work in pairs, and all of us need to pitch in.”
Vijaya spoke up.
“Don’t worry. We will get this done. We are all proud of this product. And I for one am proud of this company. I will do my part. I know each of us will. These customers will all be live within two weeks. Count on it.”
“Give me the toughest ones. I have some catching up to do. You guys have been incredible to me, and it’s the least I can do.”
One of the junior engineers pitched in.
“I wear my SparkLight hoodie everywhere. I’m so proud of us. Thank you for hiring me, I feel really privileged to be here. And count me in — I’ll do whatever it takes.”
The resolve awed you. Two-person teams fanned out. For the local dealers, one person worked on site, paired with an engineer at the office. Many launches took most of the day to execute. For the three dealers not in the Bay Area, the launches took a week or more. But all twenty-seven dealers were fully launched by late February. Three weeks later than initially planned, but good enough.
With just $300K in cash left in the bank and a $130K monthly burn, it was clear that end of April would be the terminal date for an A round close. You had socialized the story to VCs since mid-January. Somewhere in the midst of the rush from VC meeting to dealer meeting and back to the office, it crossed your mind that you ceased to be CEO. You were now CEEO — Chief Everything Else Officer. You completely rebuilt the financial plan. You created the pitch deck. You organized a data room. You managed payroll, getting the bills out on time and paying the incoming ones. And now you ran around doing funding pitches.
Seventeen VCs took initial meetings, held throughout February. Four invited you in for full follow-up pitches to their partner groups. Two submitted term sheets. After conversations, you offered Smash Capital the lead, asking for a minimum $5M investment. You expected Anik would bring in his firm, Kapoor Capital, to cover the remaining $3M.
Wednesday morning, March 1, you received in your inbox a term sheet from Smash, stipulating a $5M investment if you could secure an additional $3M from another investor. Later that day, Anik and Fess joined you in a review of the terms. That same day, Anik confirmed that Kapoor Capital would commit $3M, and everyone signed the term sheet.
Today, March 2, your inbox includes a quick “we’re excited” email from Smash, with a due diligence checklist attached to complete ASAP. First on the list is a request for the names and contact information of all twenty-seven dealers sold on the platform.
Let the games begin.
. . .
To understand leadership, one must understand followership. Followership is the proof of leadership. Product innovation, workflow optimization, quality, and productivity are all advanced when followership is strong. Followership is a generative force that propels a company forward. Followership is closely linked to motivation — both intrinsic and extrinsic. Great leaders remove barriers to intrinsic motivation, and carefully administer extrinsic motivational inducements to nurture desired behaviors.
Intrinsic motivation emerges from inside out. It’s the innate desire of all of us to pursue work that feels like play, has a purpose, and advances our personal growth. Since intrinsic motivation doesn’t require external prompting, it is the ideal motivational form. Of course, intrinsic motivations can be reinforced by the words and actions of leaders.
Extrinsic motivation is triggered by an external stimulus — the proverbial carrot or stick. Bonus programs and promises of recognition are carrots; public criticism and threats of demotion or termination are sticks. Recognition and rewards for actions consistent with one’s values and identity — such as selling a product you believe in — enhance intrinsic motivation. Fear, on the other hand, is at best a crude motivational instrument. It does force change and can shut down undesirable behaviors — but most often, it stifles intrinsic motivation in the process.
In November 2015, Lindsay McGregor and Neel Doshi presented their research in the Harvard Business Review concluding that employees are motivated to work for six reasons:¹
- Play — the work is fun
- Purpose — the work fits your core identity
- Potential — the work benefits your identity
- Emotional pressure — an external force threatens your identity
- Economic pressure — an external force that is separate from your work and identity
- Inertia — your work and identity are so far removed that you can’t identify why you remain
The more your work is intrinsically interesting to you, McGregor and Doshi found, and the more that it is aligned with and benefits your identity, the more motivated you are. The research shows that emotional pressure and economic pressure are extrinsic motivations; they tend to impair productivity and creativity. Inertia is the weakest type of motivation of all — sometimes observed as “he quit and stayed.”
McGregor and Doshi go on to confirm that employee motivation correlates positively with customer satisfaction, offering proof that motivation has an economic benefit. For instance, here a correlation analysis they provided for the airline industry:
Further, play, purpose, and potential are the most powerful of intrinsic motivators, positively correlated with creativity and productivity. There may be external actions that nurture these motivations, but the resonance is from within, from one’s sense of identity. Leadership’s role is to remove barriers so that these intrinsic motivations can flourish. High-performing cultures cultivate play, purpose, and potential while minimizing emotional pressure, economic pressure, and inertia.
Leaders remove barriers to intrinsic motivation when they place employees in well-designed roles, create an organizational identity marked by a clear mission and a healthy culture, offer advancement opportunities, create a distinctive community, and empower employees to participate fully in decision making. These are acts of strong directional, executional, and moral voice. The research shows that these processes — signs of effective leadership — have significant impact on employee motivation:
These results are consistent with a long pedigree of motivation research in the workplace, going back to Frederick Herzberg in the 1950s. Herzberg listed a set of key motivators including achievement, recognition, the work itself, responsibility, advancement, and growth.² These motivators (which overlap significantly with McGregor and Doshi’s “play, purpose, and potential” motivators) drive job satisfaction. He also listed potential dissatisfiers: company policies, supervision, relationship with supervisor and peers, working conditions, salary, status, and security (these too have some overlap with McGregor and Doshi’s “emotional pressure, economic pressure, and inertia”). These hygiene factors, Herzberg said, could drive job dissatisfaction.
Herzberg’s unique contribution was to note that satisfaction and dissatisfaction are not opposites — they are different. The opposite of satisfaction is no satisfaction; the opposite of dissatisfaction is no dissatisfaction. He argued that leaders should first work to eliminate job dissatisfaction, and then work on building up job satisfaction.
Followership is hard-won. For an employee, the choice to designate the title “leader” upon a manager or CEO has consequences. It’s an act of sacrifice. An employee potentially gives up significant independence in return for a purpose, deeper emotional engagement, and higher taxation of effort. Followership stems from leadership action — the exercise of strong directional, executional, and moral voice.
Rewards and recognition are highly effective motivators when properly deployed. For example, tying financial goals to the achievement of performance goals is best practice now. Assuming the work itself has attributes of play, purpose, and potential, the rewards will enhance motivation. And when an employee achieves a new threshold of performance achievement, recognition is both appropriate and appreciated.
But excessive recognition for doing the expected can backfire. It can provoke a shift in the employee’s motivation from intrinsic to extrinsic, creating unintended emotional or economic pressure that weakens performance. The goal of leadership should be the opposite. Effective leaders leverage extrinsic rewards (and, rarely, punishments) with sophistication, and combine these rewards with clear directional, executional, and moral voice.
A well-run company and a healthy culture are the leadership ingredients that enable followership — and intrinsic motivation — to flourish.
Followership is not a yes/no, binary state. Followership is a reservoir. The reservoir fills in two directions — broad and deep. The higher the percentage of employees who become followers, the wider the reservoir. And for each follower, the nature of that followership can be transactional and shallow, or transformational and deep. When the directional, executional, and moral voice of leadership is strong, followership has breadth and depth. For the employee, a leader who creates a well-designed organization anchored in sound mission and principles, and who cares, who respects, who defends, and who challenges, merits followership.
Personality-driven leaders, like Steve Jobs and Larry Ellison, were known for their ability to create “reality distortion fields” that led employees to reach for seemingly impossible goals. These employees performed at high levels of output. For such leaders, strong directional and executional voice combined with energetic, charismatic attributes to create followership. Jobs, for instance, was an undeniably transformational leader, despite many publicly reported incidents of selfish acts, cheating others of financial rewards, and public shaming of employees which occurred over the course of his career. When the personal charisma is strong enough, it can sometimes combine with strong directional and executional force to yield high performance despite lapses in moral voice.
Most CEOs don’t have the option to be a personality-driven leader. Few have the charisma. But every leader can be principles-driven. Throughout the seventies, eighties, and early nineties, Hewlett Packard became one of the most successful tech companies of all time under the leadership of Bill Hewlett and Dave Packard. Central to the company’s operating philosophy was the HP Way. Bob Apollo, a long-time former HP employee, said the following:
“At the time, the principles must have seemed radical — revolutionary even — to most other companies. They established the importance of respect for the individual, the value of leadership, the importance of integrity, the power of teamwork, and the need for adaptability….The HP Way wasn’t just words on a page: it truly reflected how the company and its employees chose to behave. In truth, it doesn’t matter one jot what pompous statements companies make on their web pages or in their corporate mission statements — it matters what they do.”³
Bill Campbell’s tenure as CEO of Intuit spanned from 1994 to 1998, at which time he became chairman until early 2016. During that time, revenues increased from $223M to $4.7B. By all publicly reported accounts, Campbell exercised a finely tuned balance of moral, directional, and executional voice in his leadership. He cared deeply about people and committed himself to the development of others while pursuing a well-conceived direction and a well-orchestrated executional approach. He is a prime example of a principles-based leader.
Mark Brewer, CEO of fast-growing software company Lightbend, also exemplifies the principles-based leadership model. Brewer has profound directional clarity and executes with fidelity. But he is also highly attentive to the moral dimension of leadership — caring, quality, temperance, prudence, courage, and justice. At Lightbend, Brewer holds one-on-one meetings with all direct reports weekly, and with every single employee at least once a year. He wants to know what employees really think. Brewer invests significant time and energy in leadership development so that everyone in management gains the skills to effectively coach and develop the employees under their charge. He values transparency. Every other week, an employee “pulse” survey is sent out. Everyone in the company receives the results showing areas of employee concern and the latest trend in an employee satisfaction measure. Areas of concern are flagged and discussed at each all-hands meeting. These actions nurture the “play, purpose, and potential” motivations most positively correlated with productivity and creativity.
Personality-based leadership absent of moral voice can work. Great companies still get built this way. Steve Jobs and Larry Ellison are examples of that. But there can be no doubt that strong moral voice — joined with strong directional and executional voice — widens and deepens the followership reservoir, in turn increasing creativity, innovation, quality, productivity, and personal growth.
So how, precisely, is followership expressed? It varies depending on role level, function, task-relevant maturity, and personality.
Front-line employees express followership through commitment and diligence. There is a job to do, and a follower seeks to execute his or her role efficiently. Empowered cultures encourage employees to give voice to concerns and observations, and to participate in decision making. This goes beyond the letter of the job description. A follower sees what isn’t working and speaks up, looks to join in workflow optimization efforts, and calls out cultural lapses. A follower seeks to understand the company’s goals and direction and to interpret them in the context of assigned responsibilities. Followers seek personal improvement.
Followership and empowerment are not in conflict — on the contrary. At Google, pains are taken to limit managerial power and increase individual contributor power. The belief is that empowerment increases company-wide alignment with the company’s mission, and inspires a sense of ownership in all employees. Individual contributor employees are actively involved in hiring their managers and peers. They have input on their performance ratings. Individual contributor employees are solicited for 360-degree managerial feedback. Every employee is free to work on self-directed projects twenty percent of the time. Google takes individual contributor empowerment seriously — but it also expects a deep commitment to the mission of the company coupled with the conscientious pursuit of innovation and high quality work outputs in return.
The higher up you move on the organization chart, the more you delegate authority. Managers, directors, and senior directors are expected to exercise judgment in decision making. The more senior the role, the more freedom of movement, consistent with cultural boundaries. Here followership is expressed by the earnest desire to make decisions consistent with the spirit of top leadership’s stated direction. Mid managers resolve cross-functional conflicts by referring back to the directional and executional guidelines provided by top management. They search for the spirit of that direction, and how it pertains to the debate at hand.
For executives, followership involves a deep personal commitment to mission and vision and the commitment to full participation in the shaping and execution of strategy. Executives own the responsibility to provide CEO counsel, to question and challenge CEO assumptions and to help the CEO refine ideas. They also share an accountability relationship with the CEO, which requires transparency and responsiveness to CEO coaching. These are the attributes of executive followership.
Role-specific patterns influence followership.
Engineers often affiliate with technical communities — Linux, open source, .Net, Java, the microservices movement, and so forth. Such communities serve a useful purpose: they help engineers keep current with tech trends, play an essential role in skills development, and are a support resource for problem-solving queries. But community loyalty can fight with company loyalty and followership. Leaders build followership with engineers by honoring these communities while aligning employees to the mission, vision, and values of the company. Here, you can leverage extrinsic motivational tools, but the goal is always to build intrinsic motivation by aligning leadership action with the security, acceptance, status, and self-actualization needs of engineers — including support for their communities.
Creativity is a powerful catalyst for innovation. But some highly creative people such as successful user experience designers may exhibit resistance to group thinking. The creative persona is characterized by a profound independence of thought and action. Highly creative people possess a crystal clear inner vision of truth. They will work with rare diligence to evoke it. For such people, it’s not uncommon for their loyalty to the vision to exceed their loyalty to the company.
Highly creative people may be much harder on themselves than any manager will ever be on them — for the goal is nothing short of perfection. The most talented creative workers are sometimes prickly and hard to work with. Compromise is not in their lexicon. The best creative minds may exhibit little confidence in other people’s view of perfection. Effective leadership of highly creative people involves tolerance for unique behaviors, significant independence, and a narrowing decision path as the creative process moves towards full fruition.
The apprentice’s approach to followership differs from the maestro’s. For the VP Sales recently promoted from Senior Director (i.e., task-relevant maturity is at the apprentice level), the accountability relationship with the CEO will involve significant CEO direction and frequent meetings. For the customer success manager who has been on the job for three years and is performing at the maestro level, the accountability relationship with the boss will be collaborative, sprinkled with bar-raising challenges.
Apprentices express followership by executing on clear directives and seeking to improve skills. Journeymen respond to encouragement and attempt to advance the company’s goals by continuously developing themselves and the workflows they touch. And maestros show followership by delivering strong performance and challenging conventional wisdom, consistent with the spirit of the company’s stated direction.
Individuals are unique. People vary in degree of need for status, achievement, and affiliation. The more achievement oriented you are, the more you possess a natural motivation to succeed. The higher your need for affiliation, the more you will seek to meet the standards of your peer group. All else being equal, variations in employee profile will result in variations in output. Leaders consistently search for employees that exhibit high levels of need for achievement and affiliation, and through selection and retention decisions, cultivate their organization accordingly over time.
Leaders don’t build great companies — followers do. But leaders build followers.
. . .
The A round closed on May 4th. You threw a catered party for the entire team in a private room at the Hyatt, with some delicious hors-d’oeuvres, fun games, and a two-drink maximum.
$8M is now in the bank. You go back to the financial plan and review the revenue growth commitments you made. Suddenly the growth curve looks steep.
Time to build a sales and marketing department. Better get moving on to the next phase of product development. And you need to create a customer success team. And find a controller to run finance and HR. Meanwhile, you need to move into a new, bigger office and start paying rent. An old saying runs in your head as you smile ruefully — “Be careful what you wish for, you just might get it.”
. . .
- Lindsay McGregor and Neel Doshi, “How Company Culture Shapes Employee Motivation,” Harvard Business Review, November 25, 2015, https://hbr.org/2015/11/how-company-culture-shapes-employee-motivation.
- Frederick Herzberg, “One More Time: How Do You Motivate Employees?” Harvard Business Review, January 2003, https://hbr.org/2003/01/one-more-time-how-do-you-motivate-employees.
- Bob Apollo, “5 Timeless Principles: Revisiting the HP Way,” Selling in the Breakthrough Zone (blog), September 30, 2011, http://www.inflexion-point.com/Blog/bid/74097/5-Timeless-Principles-Revisiting-the-HP-Way.
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