Ask VeraSage: What is Enlightened Leadership?

Aug 9

Interesting question from Greg Clowminzer over at zen coach, and very timely.

I am curious how people define Enlightened Leadership.

What is Enlightened Leadership?

Cheers,

Greg Clowminzer

I don't feel the need to repeat homilies and clichés about the characteristics of a successful leader, such as: Direction, trust, hope, vision, faith, being a servant, etc.

No doubt, these are all characteristics that are important, but I remain unconvinced they can be learned. We know what it takes to produce top-rate doctors or lawyers, but no clue as to how to produce great leaders. I'd like to tackle this question from the perspective of what I have experienced that great leaders all have in common.

I do this because my colleague, Dan Morris, and I recently taught a CPE course in Monterey California to a group of auditors. We were amazed at how unaware this group was with respect to current controversies and criticisms of their own profession.

Not one of them had heard of the books we mentioned, the initiatives being undertaken to reform the financial reporting model, or much else outside of their own realm. It was the most intellectual uncurious group we've ever encountered. Frankly, it was quite depressing.

Thankfully, most firm leaders we encounter are not at all like this. Of course, most of the people we deal with at VeraSage are self-selected, bright, curious, and tend to be early adopters. I've also noticed that they, as well as successful leaders, all have various traits in common.

I believe enlightened leaders:

Are intellectually curious about the way the world works.
Are voracious and inveterate readers. Leaders are readers, period. If you're not reading at least 50 books per year, your mind is closed and your ability to inspire others is limited. Why would I want to "follow" someone who isn't constantly expanding their own mind?
Leaders challenge the status quo, and don't accept "that's the way we've always done it" explanation so common in today's PKFs.
Are willing to take risks. If I want safety, I'll invest in T-Bills. When it comes to business, profits comes from risks, not playing it safe.
Take ideas seriously. Ideas and knowledge rule the world, and they should be taken far more seriously than personalities, societal status, credentials, and other superficial traits.
Take the time to think and reflect on their actions, two activities grossly underutilized by today's professionals.
Have followers. If you can't inspire others to find their own path, you have no business leading others. If you want to lead, learn to follow, which means you need your own leader. Hitler and Stalin didn't have a leader they looked up to (draw your own conclusion).
Don't shy away from confrontations or controversy. In fact, they seek it out. Pioneers take the arrows. There's no books in Borders titled Great Moderates in History.
Understand people should be understood and appraised based on what they believe, not what they know. The Germans of the Third Reich might have been incredibly educated, but their actions were based on their belief system.
Have faith in the future. The leap is more important than the look, but there's no way to leap without faith. Professionals seem to lack faith—in themselves, in their leaders, in their ability to add value, and in their ability to adapt to current realities.

Consider the advice from the following two leaders in the CPA profession. These gentlemen are quite successful, and probably have nice bank balances. But they fail almost every one of the traits outlined above, especially the first four.

The first comes from the Managing Partner of a New York CPA firm. When asked to share his thoughts on how to expand a firm's business and stay focused he replied:

Administration should be done by administrators, not CPAs who could otherwise bill at professional rates. It is critically important for people in professional services to stay close to the client. To take a highly competent practitioner and, in effect, remove him or her from the marketplace sacrifices not only billable hours but also information about the firm's performance that can come only from working directly with clients. The managing partner should be a strategic thinker who sets policy, creates a vision and discusses with other partners how best to adopt.

I wonder if you would apply this to General Electric? As a shareholder, If you saw Jack Welch, as CEO, go down to the shed and help the mechanics build airplane engines, would that be a buy or sell signal? Not to mention he still believes in the importance of billable hours, as if time is what creates value. I don't know how anyone with any level of intellectual curiosity can still believe in a theory that has been so discredited; but there you have it.

Another CPA firm leader gives this (mostly bad) advice from the March/April 2007 issue of California CPA in an article titled "The 4 'Cs' to Success":

Success can be measured in many ways and, in public accounting, one of those measures is making partner.
From the moment you are hired, begin thinking like a partner and team member. ...get the task done—on time and on budget.
Public accounting is all about time and billing.
If you fail to record all your time, the person doing the job next time is at a disadvantage because the budget will be too low.
And record your time daily. Don't try to remember on Friday how long something took you to complete the previous Monday. Inaccurate time records cheat you, the client and the firm.
Remember that staff costs are the largest expense of any CPA firm. You are part of a team and an expensive part of every project. ...Be an efficient worker.

There is so much wrong with this I can't even begin to rebut it. But I'll try, briefly, point-by-point:

Less than one-third of today's young professionals even want to be partners, so that simply can't be the only criteria for success. What do you do with this talent? Up or out?
Was Einstein on budget? Who knows, or cares? What about innovation, creativity, risk taking and interpersonal skills? It's simply not part of his 4 Cs' to success.
Really, all about time and billing? Not service to others, creating value, leveraging intellectual capital, or being effective? This is the same nonsense I was mistakenly taught in 1984. Firm leaders haven't altered their beliefs in over a generation! That's not what you'd call being intellectually curious.
Budgets don't create value, nor are they even good project management tools. There are better methods, but this leader shows no curiosity, but rather let's just keep doing SALY (Same As Last Year). The future will always equal the past.
Timesheets are the buggy whip of the knowledge economy, but they are paramount in this leader's world view.
Staff aren't costs, they are human capital investors who represent 80% of this very firm's ability to create wealth for its customers. To communicate they are an expensive expense is demeaning. I wonder if he'd want an efficient surgeon or an effective one? Obviously he doesn't understand the difference between a knowledge worker and a service/manual worker. Who would want to work for this leader? Count me out.

For all these reasons, and more, most professional knowledge firms don't have enlightened leaders, they have drone managers who couldn't lead a trail of ants to a picnic lunch. They treat their people like union employees in the sweatshops of yore, with no understanding of how we now operate in an intellectual capital economy. Little wonder PKFs are eating their young and having a hard time attracting and inspiring human capital investors.

Just look at what they believe. Is there any doubt that beliefs are far more important than knowledge? And these leaders never seem to challenge their belief system by taking risks and trying new things.

I don't know if that answers your question, Greg, but at least it enabled me to vent.

I look forward to others weighing in on this question, since I believe it is a vitally important topic. VeraSage fellow Chris Marston on his blog has two great posts that deal with leadership: Law Firms are Over-Managed and Under-Led and How Powerful the Mirror!.