Want to float all boats? Start by setting the tone at the top.

This is the first in a series of articles featuring simple, functional ideas for leading in a dysfunctional world – a collaboration by Josh Steele and Rita Zonius. Josh kicks things off by introducing a framework for where great leadership begins – setting a strong tone at the top.

“The research is clear: Companies that make decisions not simply for profit, but for the good of their customers and society, can make a significant impact.”  - Larry Merlo, President and CEO of CVS Health

In September 2014, CVS took the bold step of removing tobacco products from all of the company’s nearly 8,000 retail locations. Why would a company willingly walk away from sales of $2 billion annually?

Driving that decision was CEO Larry Merlo, who along with other key stakeholders, determined tobacco products didn’t fit with the company’s values centered around making health care more affordable and accessible.

Yvon Chouinard, founder of outdoor clothing manufacturer and retailer Patagonia, has similarly eschewed the path of least resistance by building a business around its mission to “build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis”.

Leading by example, the company made the costly decision to overhaul its supply chain to focus on ethically produced clothing, spending significantly more than its competitors. Instead of adversely impacting growth and performance, Patagonia’s bold leadership has enabled the company to outpace its competition by a large margin while setting the bar for quality within the industry.

Both serve as great examples of trusted leaders aligning large organizations around common purpose to pursue ambitious outcomes that transcend near-term financial results or a more myopic focus on shareholder value. Since it decided to stop selling tobacco products, CVS has continually been recognized by Fortune as one of the World’s Most Admired Companies. The lasting imprint of Chouinard’s leadership is best viewed in the lens of a Patagonia employee who said: “We want to set the best practices other people want to follow. We want to show other businesses how to do good. But in the end, we just want to do the right thing.”

By walking the talk, Merlo and Chouinard created the proverbial rising tide that floats all boats.

Good Leaders Raise the Tide

If you’re lucky, you’ve come across people who have left an indelible mark on you, shaping the way you think about work, how you live your life and stand by your values. They inspire you to think bigger and capture your steadfast admiration. They support you to be your true, best self and to look forward to every day as an opportunity to do something good. These amazing people float your boat.

I’ve had some influential leaders in my life who have helped shape who I am today. These are the ones who pop into my head when I’m grappling with a problem, causing me to think: “what would they do in this situation?” I’ve also come across people with leadership styles that grated on me like fingernails on a chalkboard and I promised myself I’d never be like one of them.

No matter what your experience has been, maybe it’s your turn to raise the tide!

The Power of Tone from the Top

Why is it that we’re happy to walk on hot coals for some leaders and not for others? What makes good leaders so influential that you’d follow them anywhere? 

An interesting psychology experiment conducted by researchers studying college students in China gives us some insights into this. It attempted to identify the conditions under which people decide whether a leader is worth following or not and what influences the level of cooperation among followers and teams.

What the experiment found was that those leaders who were willing to show their hand and contribute upfront significantly increased the willingness of ‘followers’ to contribute to shared outcomes. The more leaders lead by example, the better the performance of followers and teams.

The opposite is also true. When leaders don’t demonstrate their contribution, followers don’t contribute either.  Even worse, being Machiavellian, or opportunistic, about your contribution is a sure-fire way of igniting dysfunction and reducing team performance.

Writer, philosopher and physician Albert Sweitzer nailed it when he said: “Example is not the main thing in influencing others. It is the only thing.”

Asking your people to walk on hot coals for you is extreme. But if you want to be a leader who inspires people to work together to make a lasting impact, you must set the example and establish the right tone at the top in your organization.

Setting the tone at the top: a framework

There are three key elements to powering tone at the top. All three are needed for you to begin to mobilize people around what matters and drive real progress throughout your organization:

• Trust – As a leader, your actions speak louder than words. Build trust with your people through repeated, credible and consistent behavior that sets the standard you would like others to follow. Show humility and make sure your people know they are just as important a stakeholder in ‘the circle of trust’ as you.
• Purpose – Establish a strong sense of purpose by clearly communicating your vision. You must define the WHY before the HOW and the WHAT. This becomes a ‘north star’ that individuals and teams can use to guide their work, regardless of their function or job level. Reinforce a sense of shared outcomes. We’re all in the same boat, so let’s row together!
• Performance – Set clear expectations around outcomes and acknowledge great results. Similarly, failing to hit the mark should be seen as an opportunity to learn and improve. How we react to and communicate our failures is even more important than how we celebrate and reward our successes. Make sure teams share in both.

Setting the tone at the top sounds like a lot of heavy lifting from leaders alone. But just as the Chinese psychology experiment illustrates, leaders who speak through their actions and set expectations upfront will stand to benefit as their team members respond in-kind. Let’s call these benefits ‘force multipliers’:

• Commitment – The combination of trust and a shared sense of purpose among people will ensure a strong commitment to going after desired outcomes.
• Collaboration – Teams with a clear view of the end game and trust in their leaders will work better together than those without.
• Goals – Establishing challenging yet realistic goals exponentially enhances the positive impact individuals with a clear purpose can have on shared outcomes or performance.

Setting the right tone at the top through trust, a clear purpose and a strong understanding of desired outcomes is a balancing act for leaders today. Get the proportions right and you’ll be well on the way to earning the support of a team of people who want to walk on hot coals for you.

Clean, simple leadership ideas for a messy, muddled world

Once upon a time, a right-brained Australian (Rita Zonius) and a left-brained American (Josh Steele) met on a long trip from the US to Australia. They started chatting about good leaders, bad leaders and what makes them so. Over the course of several conversations, they agreed that the next wave of leaders and influencers is operating by a different playbook. Enjoy their functional ideas for leading in a dysfunctional world.