Have you actually encountered this phenomenon in any of the work you have done?
Part of my thinking grows out of some work I participated in with the American Society of Association Executives. Associations are, by their nature, networks. They're fluid. But an association has to have some sort of unity and cohesion. So how do you create a great association when it's inherently not self-contained? The association's researchers analyzed some really high-performing associations, in which you can see this network effect and the importance of being able to lead without direct power. I began thinking that associations may actually be on the leading edge of what more people are going to have to learn how to do. Instead of managing a company, you're managing an ecosystem that is networked and connected over the world.
I wonder what effect the Internet is having on the expectations of young people entering the work force. I have a friend who employs a lot of high school kids. He says that, contrary to popular perception, they make great employees, but the old command-and-control approach to managing won't work with them. They want to know why. If you explain the why, they will respond.
I agree on the importance of explaining why, but I think that's a signature of great leadership, not an attribute of a generation. Great leaders in any generation have always helped people understand why. Mediocre leaders don't. We should be careful not to confuse what's rare with what's new. Greatness is rare. It's so rare that, when you come across it, it often feels like it's new.
So what about customers? They seem to be playing a larger role in the decision-making process of companies than they did in the past. An extreme example is Threadless, a T-shirt company that invites its customers to vote on designs and then produces the ones that get the most votes.
That's interesting. Instead of an organization selling a product, it's a network connection that has feedback loops with customers, who are inside their network, not outside. I've also noticed a trend of increasing customer power, and it will very likely continue. Companies have to adjust to it by learning new ways to interact with customers. That's probably good for all of us, because it will lead to better companies and better results.
You have expressed admiration for entrepreneurs who have managed to turn their companies into movements—that is, something that transcends the selling of products and services and inspires actual passion. Movements, it strikes me, are composed of networks.
I think that may be one of the most underappreciated aspects of leadership. I have personal experience with a leader who's done that—Yvon Chouinard, the founder of Patagonia. When I started rock climbing in the early 1970s, we used to pound pitons into the cliffs. That was no big deal at first, but as the number of climbers increased, we started to see cliffs being permanently defaced by the pitons. Chouinard decided to take action. He brought out a set of tools for doing what's called clean climbing. If you use one of his Hexentrics instead of a piton, there's no pounding involved, so it leaves no trace of your having been there.
In the 1970s, he put out a catalog that was actually a manifesto for clean climbing. I still have one. He basically said to all of his customers, "You need to change your behavior and stop destroying the cliffs. Here are the products. You can trust them. You will not die if you use them correctly." I was a young climber at the time and watched the entire behavior of the climbing community change. Chouinard ultimately saved the cliffs. To this day, I am a loyal Patagonia customer. I'm still part of that movement. Yvon did the whole journey from idea to business to company to movement. I see it with Apple as well, which is closer to a movement than a collection of customers who buy its products.
Of course, those are both consumer companies. Does your movement theory apply to other types of businesses as well?
A movement springs up around a cause, and I think there are different kinds of causes. Software that makes people more productive is different from Hexentrics that prevent the defacement of cliffs, but they both can be part of a larger cause. Gordon Moore of Intel projected the freeing power of microelectronics. Intel's founders believed they were revolutionizing the world, and they were. In Southwest Airlines's case, the cause was the workplace. Herb Kelleher, I believe, had incredible faith in what people working together could do. I don't think it was ever really about airlines for him. It was about creating a culture that could defy all odds by having everyone in it together battling against the brutalities of the world, achieving stellar performance in a humane way. That is also a cause. And someone like Kelleher isn't an exception. The great leaders I've studied are all people whose energy and drive are directed outward like that.
"The great leaders I've studied are all people whose energy and drive are directed outward. It's not about themselves. It's about something greater than themselves."
What do you mean by "directed outward"?
I mean that, as driven as they are, it's not about themselves. It's about something greater than themselves. Take Bill Gates. His deep, abiding passion was for what software could do in the hands of all kinds of people. He wanted Microsoft to be a conduit for it. I don't think it ever crossed his mind that his work could make him a billionaire. That's what I mean by outward. Or take Steve Jobs and his drive for beauty, for making something insanely great because you can, not because of what you will get for it. I think of him as an industrial Beethoven, a product artist, who came to view Apple itself as one of his creations. Or George Rathmann, the co-founder and first CEO of Amgen. He wanted to create products that would affect people's lives. Amgen brought out a drug called EPO for treating anemia in patients with chronic kidney failure, and it ultimately affected Rathmann's own life: When he had to go on dialysis, he became an EPO patient. You see the pattern. Every one of these leaders had the idea of shaping the world around them.
