Chapter One: Power Is a Freighted IdeaUnderstand It Before You Use It
How sweet a thing it is to wear a crown...Richard in King Henry VI, Part 3 (1.2, 29)
Power! Shakespeare! Few would put these two words together. For if you want to understand power -- how to get it, how to keep it, what to do when you have it, and how you lose it -- then Shakespeare is your man. Power is a central theme in many of his plays. No writer ever portrayed the ambiguities, trappings, dangers, and blessings of power better than Shakespeare. He shows us how power is passed down through the generations. For instance, Harry Bolingbroke knocks Richard II off the throne and ends up causing the Wars of the Roses, a hundred-year strife between the House of York and the House of Lancaster. Shakespeare shows how power slips away. Henry V builds an empire, but his son Henry VI makes so many mistakes that he ends up wandering around the countryside, alone, yearning to be a humble shepherd. Shakespeare shows the seduction of power. In Hamlet Gertrude marries the man who has annihilated her husband, Rosencrantz and Guildenstern betray their classmate, and Polonius sacrifices his daughter, all because they want to stay close to the seat of power. Shakespeare shows the abuse of power. Richard Plantagenet (ultimately Richard III) exults in the act of evil, not interested in the complexities and responsibilities of power. It takes him twenty-three years to get his crown, but only two to lose it. Richard III wants power so badly that he literally kills for it. As does Macbeth. Of course, no sane CEO sets out to be Richard III or Macbeth. To hear them tell it, every CEO is in business to make the world a better place. But too many successful business leaders, despite their good intentions, end up believing their press releases, perceive power as an end rather than a means, and get distracted from their real jobs: growing their companies, making money for their shareholders, and, in the process, serving their employees, customers, communities, and society at large. And too many CEOs, like Julius Caesar, hang on to power, don't see that times have changed and that it's time to go, before they are pushed.
The proper exercise of power is one of the most persistent challenges facing us in our work lives. Some of us, like Shakespeare's Richard II, the man Bolingbroke pushed off the throne, do not understand it at all; and like him we lose it. Others of us might understand it but then fail to use it; and, like Prince Hamlet, we lose it. Understanding power -- its strengths and limitations -- and knowing when and how to use it are critical to success in the business world, as well as in our personal lives.
Our age is the age of power. Incredible power. World power. Media power. Technological power. Money power. Power that can alter things so quickly, a shift has occurred before most of the world's population knows anything about it. Power to lift up and throw down like a great tornado. And if you are a young executive who wants power, well, you're going to have to fight for it every bit as fiercely as Shakespeare's medieval knights hacking each other down in battle. But you are going to need more than courage and brute strength. You are going to need self-knowledge, know your strengths and weaknesses, have stamina and intelligence, know when to speak out, when to keep quiet, know how to inspire, how to apologize, when to act alone, when to support someone else, when to seize leadership, how to learn from mistakes, how to keep focused when everyone else around you is screaming, and how to balance personal life and professional life -- and, above all, how to retain passion, compassion, and commitment in the face of unending complications and seemingly insuperable barriers.
The desire for power can be satisfied in ways other than a cavernous corner office overlooking Central Park -- for example, in organizing thousands of people for public service or leading the best-known R&D department. Some of the perks of power are tempting -- the corporate jet, the car and driver, the corner office and executive secretary. But be forewarned: the symbols of power are not power; they are only symbols. Because I spent most of my business life running start-ups and turnarounds, it would have been counterproductive to be seen enjoying these kinds of perks, although they looked good to me. Now, as a corporate board member and guest speaker, I get to use these symbols of power from time to time. They're fun, but they're certainly not what power is all about. They are just the trappings. And like despotic rulers -- Richard III and Macbeth -- they have given power a bad name, causing many people to believe that power, by its nature, is evil.
Several years ago, I delivered a sermon at my church in which I simply referred to the notion of power. Afterward two women scolded me severely for bringing up such a vulgar issue in church. I stuttered some polite reply. Today, I would advise them that power is not necessarily an evil thing. Power is a freighted idea, filled with shifting cargo: power to build, power to tear down; power to hasten, power to delay; power to inspire, power to frighten; power to give, power to withhold; power to love, power to hurt; power to do good, power to do evil. The two church ladies, like Richard Plantagenet and Macbeth, did not understand power.
Power: Understand It or Lose It
What is the reach of power? Will a given action radiate beyond its intended scope? Will there be other unintended consequences? Should limits be put on power? What should you use it for? How far can you take it? How often can you use it? How will you know if it is effective? What will be your response if it is ignored? Above all, you must understand its target. For whom, or at what, is it directed?
There are always complex answers to these questions. What works for one person or group might not work for another. What works today might not work tomorrow. Shakespeare certainly doesn't provide absolute answers, but he poses questions so provocatively that our understanding is enriched as we contemplate the problems he presents.
Power Is Relative, Not Absolute
Power is relative to time, place, person, and situation. I have seen managers who, because they have power on their own home turf, assume they are powerful everywhere. And what about the young investment banker glowing over his first six-figure bonus, who becomes an overnight expert on economics, political science, and the weather? Money is powerful only in certain contexts: if knowledge or compassion is what is needed to understand something, money may not help.
Ask the people at IBM, Motorola, or Eastman Kodak whether power is relative or absolute. Then ask them if in the 1980s they had an understanding of the sources of their power. If at that time they had been able to acknowledge that what goes up can come down, ask them what they would have done differently. Answer: just about everything. These companies are so large that their fortunes and misfortunes are well chronicled. But many of the analyses miss the real story: these leaders and managers did not know the sources of their power, and they thought that the elevators ran only one way -- up.
Fortunately, what goes down can also go up. So as we start the new millennium, IBM is back on top once again, Motorola is clawing its way back up the success ladder, but Eastman Kodak is still struggling. We will be looking more closely at these companies later, but wherever they are -- and more importantly to you, wherever you are on the ladder of success -- don't ever lose sight of your real sources of power. Where does your power come from? And don't let today's success lull you into thinking that tomorrow will always be like today.
A brilliant exposition of how power shifts with time and circumstance is found in one of Shakespeare's lesser-known plays. In Coriolanus, Caius Martius is an experienced, powerful Roman warrior. After his superb military leadership at the siege of Corioli against the Volscians, Martius is rewarded with the name Coriolanus and encouraged to stand for consul, one of Rome's most powerful jobs. But Coriolanus, whose arrogance matches his ego, thinks he should be made consul without going through the steps necessary for elected office. He feels that the "politicking" he must do to be elected consul is beneath him. So his first error is to think that being a great warrior automatically qualifies him to be a politician. Second, he fails to recognize that Rome's tribunes, the city's middle managers, are out to destroy him politically. And because their tactics are unlike a soldier's, Coriolanus has no idea of or desire to counteract their activities, and they succeed in getting him banished from Rome. The indignant Coriolanus seeks revenge. Dressed in rags, with no weapons, he makes his way to the Volscian camp and seeks out his old adversary, Aufidius. This time he makes a masterful move and in a gesture of humility offers his naked throat to Aufidius:
...and presentMy throat to thee and to thy ancient malice;
Which not to cut would show thee but a fool...
Coriolanus (4.5, 98-100)
You can see that Coriolanus has undergone two major power shifts: from Roman noble to battle hero to failed politician. And now he undergoes a third: to bum. He is a supplicant, like a fallen corporate hero once "master of the universe" whose company faces bankruptcy, pleading with bankers for more time and more money. However, this time Coriolanus's actions pay off -- probably because he understands his enemy and fellow warrior, Aufidius, better than he did the tribunes. "Go to someone you know and who knows you" is probably not bad advice. Aufidius, appreciative of Coriolanus's prowess in battle, knows that with Coriolanus's help, he, Aufidius, can achieve his lifelong dream, the conquest of Rome. So he assigns half of the Volscian army to Coriolanus's command:
...takeTh' one half of my commission [soldiers], and set down
As best thou art experienc'd, since thou know'st
Thy country's strength and weakness...
Coriolanus (4.5, 140-43)
So the power shifts again. And Coriolanus is on his way back up, and he's back with people he understands: soldiers. Like General MacArthur's men, ordinary troops idolize him. Aufidius's lieutenant reports a potential problem to him -- Coriolanus's relationship with half of Aufidius's army:
I do not know what witchcraft's in him, butYour soldiers use him as the grace 'fore meat,
Their talk at table and their thanks at end;
And you are darken'd in this action, sir,
Even by your own.
Coriolanus (4.7, 2-6)
Although Aufidius realizes he is losing the loyalty of his own men, he ruefully replies:
I cannot help it now,Unless, by using means, I lame the foot
Of our design [to conquer Rome].
Coriolanus (4.7, 7-9)
Aufidius is so eager to report a profit next quarter that he ignores the fact that it could be dangerous to have Coriolanus leading his troops. He has turned over half his company to an ambitious vice president, who promises results even though his credentials are questionable. And for a short while it looks as if Aufidius's gamble is going to pay off. But just before Coriolanus is about to attack Rome (and both sides are convinced he will succeed), his strong-willed mother talks him out of sacking and burning his hometown, convincing him to seek an armistice instead. Because Aufidius has given up so much of his power to Coriolanus, Coriolanus can do this. But when Coriolanus completes the peace negotiations and Rome is saved, Aufidius is so humiliated that he and a group of conspirators assassinate him.
In today's world, this scenario of shifting power is all too familiar. Once, not long ago, the jobs of senior executives were seen as sinecures. If you made it to CEO, vice president, or division manager, you could count on having a smooth ride to age sixty-five, collecting your gold watch, and living comfortably on your pension. No more. And probably not ever again. The competitive landscape is changing too fast, and stockholders expect near-perfect performance. Still, many executives I have known have let themselves be lulled into thinking that today's success will be repeated automatically and forever. I don't counsel paranoia, but in the first four chapters of this book we'll demonstrate some of the pitfalls -- and pratfalls -- lurking for leaders who believe that power is absolute. Let us be clear: it is not absolute, it is relative to time and place, person and function.
Power for Power's Sake Is Power Lost
If we believe or act as if power is for power's sake alone, we are sure to lose it. One of Shakespeare's first protagonists, the man who would be Richard III, originally appears in two early plays, King Henry VI, Part 2 and Part 3, dreaming about "how sweet a thing it is to wear a crown." By the time of his own play, King Richard III, an older if not wiser Richard has become a single-minded terrorist who slaughters his way to the throne. He has his own brother stabbed and then drowned in a barrel of wine, his nephews smothered to death, his wife poisoned, his in-laws executed.
Richard has the great business leader's ambition and determination, no question about it. His rise is proof of the power of power, not to mention its addictive properties. Richard does not seem to have any goal other than to be king. After a brief reign (his two years on the throne are reduced to about two weeks by Shakespeare), when he tries to escape death in battle, he is more than willing to give up the throne he murdered eleven people for, to save his own neck. "A horse, a horse, my kingdom for a horse!" he exclaims for generations who will repeat his phrase. A desperate trade, but appropriate for one who wants power only for power's sake.
Macbeth, too, wanted to be king without knowing exactly what to do with the power once he was crowned. He, too, was willing to kill for power. But while Richard III is the kind of monster that even the most aggressive executive will have trouble recognizing in the mirror, Macbeth is like us. He wants power, but he also feels guilty about what he's willing to do to get it. A brave and loyal servant of a good king, the warrior Macbeth learns from the three witches he meets in the third scene of the play that he is destined to be king. Immediately, Macbeth can see himself on the throne; worse, he realizes that he is willing to consider assassinating King Duncan to achieve this destiny. When he tells his wife about the three witches' prediction, Lady Macbeth encourages him to go for it even though she's confided to the audience earlier that he's "too full o' the milk of human kindness." But what executive (or his wife) has not dreamed of making the boss disappear? Macbeth, like us, resists his urge, for a moment anyway. He has a conscience. He knows Duncan is a "gracious" man. However, when he tells his wife of his qualms, she lets him have it: "When you durst do it, then you were a man." She also puts their relationship on the line: "From this time forth, such I account thy love." It's all Macbeth needs to get him over the moral hump. He sets out to kill King Duncan.
The appeal of Macbeth to the audience, as many critics have noted, is that we can empathize with him. While his murders might appall us, his desire to get rid of the opposition hooks us. In spite of knowing what he ought to do, he does otherwise. Do we see ourselves here? As he says:
...why do I yield to that suggestion [of murdering Duncan]Whose horrid image doth unfix my hair,
And make my seated heart knock at my ribs,
Against the use of nature?
Macbeth (1.3, 134-37)
We understand the temptation he faces because we, too, aspire to the big job. We also have been fed the fallacy that great leaders need to be "killers." We have heard Lady Macbeth question our manhood. And who in the business world does not understand the power of what Macbeth calls his "vaulting ambition"?
But what does Macbeth accomplish once he wears the crown? He becomes a serial killer. To secure his power, Macbeth orders the deaths of his best friend, Banquo, Fleance, his best friend's son, anyone who is against him, even Macduff's children. A noble warrior, he seems never to have thought about the necessities of politics or the good of the people he is leading. He is interested only in power for power's sake. And therein lies the seed of Macbeth's tragedy. In the characters of both Richard III and Macbeth, Shakespeare shows us the most dangerous temptation of power; namely, that we think it is a good in itself. Might is right.
Beginning in the 1960s, many successful chief executives began to grow their companies for the sake of growth only. Every healthy organization requires growth. But sound growth is one thing, unbridled growth quite another. The early conglomerates were often cobbled together under no grand strategy other than "Bigger is Better." James Ling was at the forefront of this movement. At the start of the decade he acquired several firms to create Ling-Temco-Voight (LTV), an aircraft and electronics manufacturing corporation. At the end of the 1960s he went on a tear, acquiring other conglomerates in sporting goods, foods, pharmaceuticals, airlines, and car rental companies. But when he bought Jones & Laughton Steel, the debt forced him to divest many of his other holdings. In the late 1970s he renewed his quest, buying a sheet and tubing firm, a steamship line, a maker of military vehicles, and finally another steel company, Republic. By 1986, LTV was bankrupt. It emerged from court protection only in 1993 -- as a debt-ridden producer of flat-rolled steel.
During this same period Charles Bluhdorn, the swashbuckling chief executive of Gulf + Western, acquired a very successful Hollywood movie and TV studio, Paramount, and then added the country's leading book publisher, Simon & Schuster, as well as an array of consumer and industrial products firms. Within three years after Bluhdorn's death in a plane accident in 1983, his successor, Martin Davis, had sold sixty of these companies, reducing its workforce by two thirds and its sales by half, finally giving it a new focus and vigor. The studio and publishing arms were renamed Paramount Communications. Ten years later it was sold to Sumner Redstone's Viacom and functioned effectively as part of a large entertainment corporation. While Paramount and Simon & Schuster flourished, Gulf + Western no longer existed.
More recently, the investment banking firm Drexel Burnham Lambert went down for the count for the same fundamental reason. During the junk-bond craze, DBL issued ever more risky debt for companies no one else would finance. When these firms foundered, DBL lost its credibility and financial clout. It declared bankruptcy.
The U.S. economy has been excellent the last few years, so the dramatic unraveling has not been quite so dramatic. However, the current wave of spin-offs does show that executives today might have learned something from the 1970s and 1980s and that they are more wary than their predecessors. The acquisition frenzy of the 1970s and 1980s only proves a point that Shakespeare was making four hundred years ago: Power sought for its own sake is bound to be power lost. No matter what level you're playing at, the manager who is interested in power only to acquire "more" is in business for the wrong reason. When you are reveling in your "killer instinct," you may want to think about how Macbeth and Richard III (and Jimmy Ling and too many others), the most powerful men in their realms, each met, as Shakespeare says of Richard, "his piteous and unpitied end" (Richard III, 4.4, 74).
Over and over again, Shakespeare advises us that the best leaders seek power in order to accomplish something.
Power from the People: A Conundrum
The leader must understand the source of his power, and he must also understand that pandering to that source will ultimately defeat him. On the one hand, we all know that the authority to lead is derived from those who are led. A good leader hears the people he is leading and lets them know they are being heard. However, when he or she has to make a judgment call about the course of action, it may not be the popular one. The people may not even have thought of the action that the leader is preparing to take! And the person remains a leader only if the people will be led. Making people do things because you can is not a very good way of leading -- for power alone, ultimately, cannot protect power. Even dictators, though the army and the secret police might support them, can be deposed. Hitler died in his bunker; Mussolini was hanged by his heels. "Baby Doc" Duvalier was banished. Even those dictators who died in bed will eventually be discredited; Mao, Stalin, and Lenin are now seen for what they were -- ruthless murderers, not compassionate servants of the people.
And yet, perceiving that even the most entrenched leaders can be deposed, some leaders, in their desire to hold on to power, will do anything to keep the people happy. On the political scene, we see polls and pandering being used as the very foundation of leadership. In the corporate world, we see leaders who are afraid to take a principled stand, leaning toward powerful but unrepresentative shareholder factions, bending for public interest groups (which may or may not have the public interest in mind but do make a lot of noise) and aggressive minorities. It is true that a political leader needs the information that polls provide; a business leader needs information from marketing research, financial advisers, public relations polling, and employee surveys. But how important is that information? How should it be used?
If the leader gains insights from the resources listed above, should he or she devise a course of action that at least will please the majority? First he must ask, "Which majority?" Perhaps a majority agrees about one destination, but each individual wants to take a different route. However, if a different destination were offered, a different majority might materialize in its favor. Even if these problems were solvable, what about the minority and its many permutations? We may need their support, too, if we are to reach the destination.
None of this is new to leaders, managers -- or followers. The newly appointed manager learns the first day on the job that he or she cannot please everyone all the time. Some elected leaders have learned, to their sorrow, that a preoccupation with polls is a prescription for failure. Would that more leaders in government or business had read, understood, and had the courage to act on Edmund Burke's advice: "Your representative owes you not his industry only, but his judgment; and he betrays, instead of serving you, if he sacrifices it to your opinion." Perhaps Burke was advised by Coriolanus, who, flawed as he was, knew some tenets of leadership. Coriolanus urges his fellow senators to see that by yielding to popular demands,
...
Thus we debaseThe nature of our seats, and make the rabble
Call our cares fears...
Coriolanus (3.1, 135-37)
He goes on to say,
...Your dishonourMangles true judgement, and bereaves the state
Of that integrity which should becom't...
Coriolanus (3.1, 157-59)
Leaders are not sponges to soak up and then squeeze out the same muddy water. Leaders are not conduits merely, but creators. And great leaders are great creators. Someone else would have discovered America if Christopher Columbus had been required to put his proposition to a vote. Would General Electric be as successful as it is if, twenty years ago, Jack Welch had sought to please his hierarchy of comfortable vice presidents -- senior vice presidents and group vice presidents -- and asked them to approve his sometimes draconian measures? Franklin Roosevelt and Ronald Reagan were elected by the people, but had they been required to put to vote every action they deemed necessary in order to create the New Deal or to win the Cold War, the country could have taken years to recover from the Depression and the Cold War might have gone on forever.
A leader must understand the capabilities of his followers, not as they exist today, but as they would exist if they were stretched. The leader's job is not to seek what is comfortable, but what is possible and what will ultimately serve the purpose. Yes, the leader must also understand the mood of those he is leading, but not in order to pander; rather, to know where to place the ladder, so that he and his followers can climb together. And ultimately a leader must convince her followers, through action, example, and argument, that this is the way to go and together they can do it.
Power Is a Tool
When we understand that power is a tool -- and can be used as a tool for good -- we begin to unlock its potential. Tina Packer began her career in the theater with a prejudice against power. Raised in England in a family with deep attachments to the working class, Tina, who went to school in the 1960s, believed that the rich and powerful were always out to exploit the poor and the weak. Then, as she entered the workforce as an actress, she began to think more deeply about power. She was a member of England's legendary Royal Shakespeare Company: a small cog in a large organization. Soon she conceded to herself that she wanted power. "Because I had none," she recalls. But Tina, unlike Macbeth or Richard, did not want power only for the sake of having it. Let her explain:
I wanted power because I couldn't bear not having a voice. As a mere actor in the theater world, you have no voice. You're cast based only on what you look like, and you begin to lose all sense of who you really are. I knew if I wasn't to lose myself, I had to start doing the kind of theater I thought was important. Even though at that time I was working with the best theater directors in the English-speaking world, I still felt as if I was of no consequence because what they were saying was not what I wanted to say. Mind you, at that time I didn't really know what I wanted to say. But I had to step out and start saying what I thought I thought; otherwise I would remain voiceless. I had to start making my own mistakes in order to define who I was. If I can generalize for a moment, I think that's true for a lot of women. Often we feel that we're powerless, at least in the ways that the world currently defines power. One of the joys I look forward to is the ways in which women can influence the way power is manifested. I wanted to articulate what I thought would make a great theater company, and I wanted to run it in a way that would include everyone's creativity.
So Tina, a born critic of the powerful, realized the only way she could find out whether she could do a better job than the people she was working for was not to sit on the sidelines and criticize but to try to get her own vision working. And that meant leading and being willing to step out and create a different kind of theater. And she found that she could do it. She didn't want power for power's sake. But she did want to get something done. She was, if you will, called to power.
Power -- Use It Wisely or Lose It
Action without thought is foolish, but thought without action is fruitless. There comes a time to decide, then act. You might not have all the information you need (in fact, you never have enough information), but if you wait too long, the opportunity will pass you by. In the turnarounds that I have led, I have rarely had all the information I wanted; but when I weighed the consequences of delay, there was no contest. If a company is already in crisis, there is little left to lose but much to gain. In that respect, turnaround decisions are less complex than decisions in stable business enterprises. Ironically, however, the context of stability can lead to inaction, and then once great or near-great companies themselves become candidates for a turnaround. General Motors, in the 1960s and 1970s, was hopelessly ensnarled in stability: its market share plummeted from a high of 50 percent to under 30 percent today. The Japanese, who not only understood quality but acted to improve it, stole the market. But quality alone cannot sustain an economy. Now bureaucratic stagnation has helped turn the Japanese economic miracle into an economic mess. I have consulted in Japan for many years, and, as much as I enjoy the people I work with, I am dismayed by their inability to act quickly and decisively. I spent years encouraging middle management to offer ideas to their bosses, terrific ideas, ideas that would have made a real difference to the company -- only to have them quashed simply because they came from someone below the status of executive! This lack of openness is death to a vital organization. The exceptions are there, of course -- Toyota, Sony, Shisheda, and Kao clearly demonstrate that they can compete globally; but even those companies are having troubles in their domestic market that have diverted their attention away from developing effective global strategies.
Strategies -- Power Focused
In Chapter 11 we argue that every person and every enterprise has a strategy of some sort. It might not be obvious; it might be submerged in a muddle of an unconscious mind; it might change from moment to moment; it might be contradictory or fuzzy; but whether or not we can articulate it clearly, our actions are always dictated by some kind of strategy. However, before we comfort ourselves with the notion that we are strategists, we need to realize that strategies with the characteristics described above are rarely effective. A strategy should be well crafted, well articulated, and relatively consistent, and should have criteria by which its success or failure can be measured. We'll talk more specifically about strategy in Chapter 11; but it goes almost without saying that with no plan or criteria to measure your performance, you might stumble into success -- but then, you might also win the Irish Sweepstakes.
In the plays King Richard II and King Henry IV, Part 1 and Part 2, we see a man who has thought carefully about both his personal and political strategies. We first meet Harry Bolingbroke (who is to become King Henry IV) in King Richard II. Richard is a self-absorbed, profligate ruler who makes a suicidal mistake: after the death of one of the kingdom's most powerful nobles, Bolingbroke's father, John of Gaunt, Richard cuts off Bolingbroke as his father's heir and confiscates Gaunt's lands and possessions. He commits one of the major sins of a leader: he doesn't protect the rights of his people, he exploits them, thereby enraging not only Bolingbroke but also all the other nobles in the land. He creates an opposition to himself. "If it can happen to Bolingbroke, it can happen to me." Shortly before John of Gaunt's death, Richard, in an attempt to settle a quarrel between the Earl of Mowbray and Bolingbroke, banished Mowbray for life and Bolingbroke for six years. On hearing of the confiscation of his inheritance