Helping Leaders Lead

I generally don’t publish my leadership “secret sauce” because it is personal to me and my clients.? But I risk sharing it because, in my humble opinion, too many lending companies, and their leaders, are focusing on the wrong things.?

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So, anyone who has worked alongside me knows that I am a student of Ichak Adizes and Gerry Faust.? They were, in fact, more than consultants.? They were pioneers in the field of leadership—serious, insightful and astute observers of organizational behavior, which they had been studying for almost four decades.? Adizes was born in Yugoslavia and raised in Israel, he built his own company, the Adizes Institute which he founded in 1975.? Gerry Faust was an entrepreneur in San Diego, and his business, Faust Management, was a partner in the institute and our consultant at First Franklin.? Gerry was instrumental to helping me grow and develop my leadership team and scale up the business. ?He was my Peter Drucker!

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Over the years, Adizes and Faust developed what amounts to a general theory of leadership, which they presented in an unusually lucid book titled Corporate Lifecycles: How and Why Corporations Grow and Die and What to Do About It (Prentice-Hall, 1988).? Their basic contention is that organizations have life cycles just as living organisms do.? They go through normal struggles and difficulties at each stage of the life cycle, and they create predictable challenges in moving from one state to the next.? But unlike living organisms, business organizations do not have to grow old and die.? It is possible for them to arrive at and stay in their prime forever, and they described a methodology that will allow them to do it.

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The” secret sauce” is understanding the life cycle and “getting to prime”.?

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A company’s place in the life cycle depends on two factors—flexibility and control.? When a company is young, it is very flexible, but its behavior is erratic, which is a function of self-control and the entrepreneurial nature of independent mortgage lending.? It’s like a baby.? You never know when it is going to smile, when it’s going to soil it’s diaper.? So, what happens when the company ages?? Flexibility goes down, and self-control goes up (compliance, lawyers, accountants arrive)—for a while, that is.? Then it goes down, just as it does in a person.? Prime is the point at which the two lines cross. ?The company is both flexible and controllable.? My expertise lies in helping my clients decide to change direction and they help lead their teams make it happen.?

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Is Prime just a matter of time and experience? ???

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Absolutely not. ?This has nothing to do with age or even size.? I have clients that are 40 years old and extremely flexible, while others are a few years old and already bureaucratic. ?When I became President of Finance of America, founded in 2015 with Blackstone, the company had billions in sales, but was already bureaucratic.? We had to change.? And companies change according to a predictable pattern, and there is a predictable pattern to the problems they have.? If you know where you are in the life cycle, you can tell which of your problems are normal, and which require special attention.? To turn around a bureaucratic company, you must make it more flexible…fast.? Bureaucratic companies like Finance of America use up a lot of energy inside because they lack trust and respect for each other.? If you don’t have mutual trust and respect, you waste a lot of time and money on internal problems and conflicts.? There is a big fad today about strategic planning, about solving your problems by beating the competition.? Wrong.

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Success, that is getting to prime, has to go from the inside out, not from the outside in.? You need to solve the challenges on the inside, so you deal with your competition on the outside, and then you have to make sure your team is in alignment…all the time.? To me that is the only way to Help Leaders Lead.

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Next up…the founder’s trap.?In your pursuit of prime, it's generally you that gets in the way. Find out why!?