Ashley Gonzenbach, Brian Byrne, Diana Perkins, Amanda Long Good to Great: Chapter 2 Ashley Gonzenbach, Brian Byrne, Diana Perkins, Amanda Long

Darwin E. Smith Grew up on a farm in Indiana Paid his way through college In-house lawyer Promoted to CEO of Kimberly-Clark Nose and throat cancer Great leader “I never stopped trying to become qualified for the job.”

Level 5 Leaders Good leaders Great Leaders Manage for the success and betterment of themselves Great Leaders manage for the success and betterment of the company and the people as a whole An individual who blends extreme personal humility with intense professional will.

Why is it called “Level 5”? Level 5 Executive = Humility + Will Level 4 Effective Leader Level 3 Competent Manager Level 2 Contributing Team Member Level 1 Highly Capable Individual

Level 5 Leaders Coleman Mockler, CEO Gillette CEO from 1975-1991 Fought off three takeover bids Invested in radically new and technologically advanced systems Died after making cover of Forbes magazine

Level 5 Leaders David Maxwell, CEO Fannie Mae Took over when Fannie Mae was losing $1 million a day Transformed Fannie Mae to beat general stock market 3.8 to 1. Gave up $5.5 million of remaining retirement package back to Fannie Mae

Level 5 Leaders Ken Iverson, CEO Nucor Comparison company Scott Paper was set up for failure by CEO Chrysler also rose in performance only to decline in later years

Unwavering Resolve to Do What Must Be Done Level Five Leadership Not just about humility and modesty Equally about ferocious resolve - Stoic determination to do whatever needs to be done to make a good company great

Deciding How to Describe Good-to-Great Leaders Initial Terms and Ideas The Other Side of the Coin Selfless executive Servant leader Can be misleading Certain labels sound meek and weak Only portray the humility side Fanatically Driven Infected with incurable need to produce results Will do what must be done Humility + Will = Level 5

George Cain CEO Abbott Laboratories Inside the company Key asset- inspired standards Would not tolerate meritocracy Set out to destroy nepotism at Abbott Took the company from good to great

Charles R “Cork” Walgreen III CEO of Walgreens Did not let the his family and emotional ties effect his decisions Took a chance Transformed the entire business

Alan Wurtzel CEO Circuit City Took over family’s small company Was a plow horse rather than show horse Sheer workmanlike diligence Credits luck Ties into “The window and the mirror” concept

Window In the Mirror Look in the mirror and blame themselves When Things Go Well When Things Go Poorly Look out the window at all the people who contributed to the success Credit factors outside themselves If the cannot find a person or event to credit they credit luck Look in the mirror and blame themselves Never blame bad luck Don’t look out on others

Joseph F. Cullman III CEO of Phillip Morris Refuses Credit for success Credits good fortune Great colleagues, successors, and predecessors Wrote book “I’m a Lucky Guy”

Ken Iverson CEO of Nucor Comparison of corporate view with Bethlehem Steel Challenge from imports Stoke of good fortune He saw problems in management

Irene Rosenfeld CEO of Kraft Foods Came from within Kraft Took over while Kraft was in a sluggish stage Been there 20+ years prior Held numerous other positions in the company Exudes passion and perseverance

What They All Have In Common George Cain Charles R “Cork” Walgreen III Joseph F. Cullman III Alan Wurtzel Ken Iverson Irene Rosenfeld Modesty and Humility Came from within The will to do what must be done Emphasis on luck and good fortune The Window and the Mirror

Cultivating Level 5 Leadership Can you learn to become Level 5? Two categories of people 1. Those who don’t have it 2. Those who do have it Practice the 11 good-to-great leaders’ characteristics and their ways

Summary: The Two Sides of Level 5 Leadership Professional Will Professional Humility Modest; not boastful Acts on standards, not charisma Sets up successors or success Looks out the window for great results Creates superb, clear results Does what must be done Sets standard for great a company Looks in mirror for bad results

Irene Rosenfeld, CEO Came within the company Very competitive Been with Kraft for 20 + years Very competitive Determined on standards, not self Very ambitious Wanted to be president, will get done what needs to be done

Three Takeaways Setting up Successors for Success A Compelling Modesty David Maxwell of Fannie Mae A Compelling Modesty very non I-centric style The Window and the Mirror Look out the window for credit Look in the mirror for blame

References www.kraftfoodscompany.com Collins, Jim. Good to Great. p 17-40. 2001. HarperCollins Publishers Inc.