BECOMING A PEAK LEADER

It’s harvest season (and, tragically for many, hurricane, earthquake, and fire season). This is the time of year when we celebrate our hard work as it comes to fruition. As an author, I’m harvesting two crops this month. I’ve just finished writing the last chapter of my next book, WISDOM@WORK: The Making of a Modern Elder, and am excited for its release next September. You’ll hear more about this in the coming year.

And, I’m thrilled that the 10th anniversary edition of PEAK: How Great Companies Get Their Mojo from Maslow is releasing on October 30th and is available to pre-order now. I’m going to devote this entire post to what’s new in the Revised & Updated edition, which includes an updated Introduction, a new chapter on my Eight PEAK Leadership Practices, and a PEAK Managerial Assessment, as well as all kinds of new examples of how companies – from Facebook to WeWork to Airbnb – are using PEAK.

There’s practice involved in sports, the arts and even religion, but we don’t think of our profession as a “practice.” We just do it. And, quite often, we do it rather unconsciously.

Practice doesn’t make perfect, but it does make public a commitment to PEAK principles. And, after 10 years of seeing companies utilize PEAK, I’ve come to realize that business principles are only as good as the practices that back them up…and the leaders who exhibit them.

When a company embeds these principles and practices into how they grow their leaders, the end result is PEAK performance: a phenomenon of sustained growth – both for the organization and for those within it.

While each practice can stand alone, when combining them together a PEAK leader unlocks the human potential that’s stored in every organization or team so that PEAK performance is more likely.

I’ll summarize these practices very briefly. Of course, the new edition goes into each practice in more depth with specific habits and tools you can incorporate into your leadership.

PEAK principles have their roots in humanistic psychology and a basic belief that man is meant to “be all that he can be.” So, it’s not surprising that the fundamental first practice is assuring that a PEAK leader believes that humans – at their very core – gravitate to goodness when the right conditions exist for them to flourish.

Abe Maslow wrote, “One can set up the conditions so that peak experiences are more likely, or, one can perversely set up the conditions so that they are less likely.” Great leaders understand there are only three relationships you can have with your work:  a job, career, or calling. Great companies create the conditions for employees to live their calling and great leaders understand each of their employees well enough to curate individual work experiences for, at minimum, their direct reports to help them elevate their work to that of a calling. The PEAK leader also asks questions like this one, “As I make any significant operational or strategic decision for the company, who on my team will be most affected by this decision, what is the potential collateral damage that could arise out of this decision, and how can I mitigate it if I am going to pursue this path?”

In business, we’re taught that leadership is all about managing what you can measure. But, what’s most valuable in life and business is often the intangible, which is harder to measure. The metrics that track the business tangibles are well known: your profitability, your cost structure, and your market share. Yet, these tangible metrics are the result of a series of intangibles that drive excellence: brand loyalty and reputation, employee engagement, customer evangelism and word of mouth, ability to innovate and create intellectual capital, or company culture. These intangibles are the inputs that truly drive the tangible output most companies use to evaluate their performance. At Airbnb, our recruiting team tracks the number of online applicants to jobs available each year as a means of understanding our popularity as an employer. This popularity index grew by more than 50 percent in 2016 after the company won the award – overtaking Google – in 2015 for being the best place to work (according to the anonymous online employee review site, GlassDoor). Other companies track unique metrics like the percentage of employees involved in company philanthropic activities, or the percentage of employees referring friends or family to work in the company (with no financial bounty attached), as a means of evaluating the intangible of employee engagement.

Transactional leaders lead from the bottom of the pyramid, while transformational leaders lead from the top. Most management decisions require only transactional thinking because the goal is purely to optimize existing resources. But, in an era of constant change, transformational leaders visualize potential and actualize it into reality and know when they need to shift from the bottom of the pyramid to the top in terms of their focus. If you tend to operate in a visionary way, make sure to always do a spot-check around buy-in. Especially with those who are most operationally involved with executing this vision. Can they link their reality to what the company is trying to do transformationally? Be sure to ask what they need to help them succeed.

Great leaders know that company culture is their secret weapon, that it needs to be nurtured and valued, and must evolve with the times. It takes years to create a compelling culture, yet you can lose it with just a few bad decisions. The most valuable lesson in this practice is to become more conscious about what constitutes your current culture and what steps you can take to move that in the direction most appropriate for your long-term corporate goals. As Airbnb cofounder Joe Gebbia says, “The more you have a vibrant culture that everyone buys into, the less process you need in the org.” Airbnb’s investment in culture takes many forms. There’s a collection of “core values interviewers” who do their normal jobs in various departments of the company – from engineers to lawyers – but are also trained to interview new candidates for their core value fit with the company. There’s also a Core Values Council that considers business issues that arise that may be at odds with the core values of Airbnb. Airbnb’s biggest investment in culture is likely its biennial One Airbnb and Airbnb Open. Imagine bringing every one of your 3,000 employees globally to the mothership to reconnect with the mission of the company.

Business has quite often been seen as a “zero-sum” game. One person’s win is another person’s loss. Taken to a global level, some believe that capitalism’s short-term gains are often to the long-term detriment of the environment and to certain communities. Yet, there’s been a paradigm shift in the past decade. PEAK-performing companies have to become conscious capitalists as the world has become much more transparent and companies have become more accountable. In the 21st century, the most profound leadership question will be how to balance being conscious about how your decisions impact those around you, and the world, with focusing on maximizing financial return for the organization. That may sound like the kind of concern only a CEO has to consider but, in reality, on a daily basis, mid-level leaders are faced with questions about how a financially-motivated decision might affect the culture of their department, the motivation of those that work with them, or the company’s reputation in the community.

The sixth practice helps a PEAK leader look beyond the borders of their company and this seventh practice furthers that expansive thinking. Transformational companies and leaders can often be contrarian by focusing on the higher needs of their obvious primary customers, but also with customers that their competitors hadn’t ever considered. Determine how you can become the world’s best mind-reader with respect to the unrecognized needs of your core customers. At Joie de Vivre, we used our process of defining a magazine and five adjectives to help us determine the “identity refreshment” we could offer to our bull’s eye psychographic customer. Intuit uses its “follow-me-home” ethnography approach to understanding the latent needs of its customers. Amazon is creating using their new retail stores as insight centers. Create a persona with a name for your primary core customers and regularly refresh your definition of who they are and what new products in the marketplace are delighting them.

Just as a Sherpa does in the Himalayas, great leaders meet their people where they are on the pyramid and help them to see the natural path up to the peak. PEAK leaders embody loyalty and build an “emotional bank account” with their employees by championing personal development in tandem with corporate development. They understand the synergistic effect of having a self-actualized individual in the workplace. And, PEAK leaders unconsciously calculate the lifetime value of their customer, employee, and investor relationships knowing that investing in relationships builds trust, which is the ultimate lubricant for a well-run business. Kip Tindell, cofounder, Chairman and past CEO of The Container Store, uses the metaphor of a wake, the trail of water left by a boat to define this practice. He says, “Your wake, my wake, everybody’s wake is far more vast and powerful than you think it is. It makes you realize how big and influential we are, and how much impact we have on the companies around us and the world around us.” A leader is a role model. It’s that simple.

Conscious people pay attention. It’s true of spiritual leaders. And it’s true of business leaders. PEAK leaders pay attention to the higher needs while not neglecting the base needs that provide a foundation for their organization. Leadership is all about making conscious choices and knowing that the higher you are in the company, the more magnified your decisions and behavior will be throughout the organization.

The eight practices that define PEAK leaders can be summarized into one paragraph:

PEAK leaders believe humans are basically good (Practice 1). And, work is a powerful means for one to live their calling (Practice 2). Yet, what’s most valuable in life and business is often elusive (Practice 3). Great leaders know that these elusive intangibles are found higher up on the Hierarchy of Needs pyramid and they try to lead from that transformational place (Practice 4). A healthy company culture can be transformative in helping a leader and an organization pay attention to higher needs (Practice 5). But, in the interdependent and transparent world we live in, PEAK leaders recognize that they have to be conscious of higher needs beyond their organization (Practice 6). Delivering on the unrecognized needs of your customers – or your community – requires a relentless commitment to innovation (Practice 7). PEAK leaders develop loyalty with all their stakeholders by operating as if they’re a role model all of the time (Practice 8). And, being a humanistic role model takes a leader back to Practice 1.

If you’ve benefitted from PEAK over the last decade, nothing makes me happier. And, if you want to learn more about how to become a PEAK leader, order the new edition of PEAK.

Wishing you an abundant autumn harvest,

 

Chip