Bill George: We Need to Bring Heart and Soul Back to Leadership
The former head of Medtronic says business should focus more on sound fundamentals, rather than short-term trading gain.
Dozens of CEOs have been willing to sacrifice the well-being of major corporations in this country over the past 10 years for the sake of their own egos and short-term gains. That was the straight talk from Bill George, former chairman and CEO of Medtronic, during an April 9 speech at Stanford GSB.
Author of the book Authentic Leadership: Rediscovering the Secrets to Creating Lasting Value, George sought to inspire Stanford students to cultivate an ethic of integrity, service, and caring that is every bit as sharp as their quantitative and analytical skills as they prepare to become future leaders.
He lamented that his own generation — the bright and idealistic men and women of the Kennedy years — had somehow dropped the famous “torch” that had been passed on to them. Referring to disasters such as the fall of Enron and WorldCom, as well as the revelations of questionable business practices in a host of other companies, George said: “Corporate executives destroyed $7 trillion of shareholder value and lost people’s trust to the point where CEOs are now ranked below politicians and attorneys” in public esteem.
What went wrong? “We have to be honest and admit that stock market dominance and the market for corporate control had a big role,” he offered. “We’re now plagued by the fear of takeovers and increasingly intense adherence to quarterly results. People are no longer investing in companies; they’re just looking for trading vehicles. We’ve stopped attending to the fundamental things: how you build the earnings per share of your company, what’s the cash flow, what’s the ROI. Today, if you beat the analysts’ numbers by a penny every quarter, you’re a hero.”
Boards are also partly to blame, he said. “They started looking for CEOs to come in overnight and save them by manipulating a few numbers,” he remarked. “They chose charisma over character.”
George called for a new kind of leader to emerge, one who checks his ego at the door and maintains an attitude of serving others. “If you do that well, you’ll have people following you to the ends of the earth, buying your products and services, and investing in your company,” he told listeners.
A leader must have what he called “heart qualities” — passion for one’s work and compassion for one’s coworkers and customers. The ability to listen to one’s own voice and have the self-discipline to maintain one’s values in and outside of the workplace are also critical, he said.
Leadership training must include not just instruction about technical business skills but also teaching about human behavior. “The easiest part of any job is working the numbers. The hardest part is bringing a group of people together and motivating them toward a common goal with a consistent set of values,” he said.
People who plan to become effective leaders should also take care to build balance into their lives from the start of their careers. “Disabuse yourself of the notion that you’re going to work really hard after school for ten or twelve years and then retire,” he warned students, “because at 40 you’ll just find yourself in a trap and you’ll stay there forever.”
Finally, George issued a plea for future leaders to think carefully about what really counts in life. “If your fulfillment in life comes from money, power, and titles, you’ll find there’s never enough,” he said. “If your fulfillment comes from relationships, love, joy, and making a difference in the world, you’ll find that your life and work have great meaning.”
George encouraged students to embrace with gusto the opportunities before them to become leaders of integrity. “The world needs quality leaders who are dedicated to serving others,” he said. “Ponder this,” he concluded: “If not me, then whom? If not now, then when?”
For media inquiries, visit the Newsroom.