Some founders still manage the old school way. The trick: striking a balance between tough and love.
Mark Stevens does not want to be loved. His eyes glaze over when he hears the word empowerment. He's still trying to figure out what work-life balance means. He is not a motivator in chief. Or a chief happiness officer.
Stevens, the founder of the Rye Brook, New York-based branding firm MSCO, is the boss. Plain and simple.
Remember the boss? He or she seems to be a dying breed. Rather than touting the structure and discipline of their companies, founders these days seem more interested in flaunting their quirks and perks.
But there still are CEOs like Stevens, who fires whiners; encourages confrontation; imposes high, unyielding standards; and manages with the understanding that his word is law. "You can't be soft in a tough world," he says. "You'll never make it." Stevens, 56, founded the 46-employee company in 1995 and serves customers such as AIG and Wolfgang Puck.
In fact, research shows that tough love can be an effective form of leadership--provided one strikes the proper balance between tough and love. One 2011 study out of Cornell University, the University of Notre Dame, and the University of Western Ontario found that disagreeable leaders had higher salaries and were considered more formidable managers than agreeable ones were.
The challenge is to set high demands while still being supportive. "When you build a relationship on trust, then the majority of people are OK with tough love," says Christine Porath, a professor at Georgetown University's McDonough School of Business. "They'll rise to the occasion; some thrive on it."
That's been the experience of Frank Poore. The founder of CommerceHub, a cloud-based fulfillment system for retailers, Poore admits that he rips apart drafts of employees' presentations--just to see if they will push back. "That might be discouraging to some people," Poore says, "but I want people to come in with their ideas fully baked and be able to defend themselves." At the same time, however, Poore is careful never to make his criticisms personal, a lesson he learned from an overly cruel drill sergeant he met in the Army. "If you attack people personally, as opposed to attacking their ideas, you've poisoned the well," he says.
In fact, studies have shown that being belittled actually does have a negative effect on cognitive function, says Porath. "You never want to use fear as your primary motivator," she says. "Even if it makes employees want to perform better, they can't."
Indeed, managers who exert too much toughness and not enough love might discover some unintended consequences. That's what Judah Schiff saw in the early days of JMAC Supply, the security-systems company he launched in 2009. Schiff is only 24, but he runs his company like someone three times older. He insists that employees clock in and out, even for lunch. He fires so-called clock watchers and people he catches switching screens on their computer when he walks by.
In 2012, that resulted in such intense churn that 24 people were fired or quit, on a team of just 14. Schiff hasn't changed, though he spends more time in the interview phase making sure potential hires can handle the pressure. The company still loses about 12 employees a year, but to Schiff, it's worth it if it means gaining two valuable staff members.
How Tough Is Too Tough?
There's a fine line between being tough and being a jerk. Cross it at your peril.
1. Don't Be Big Brother. University of Chicago researchers found that when people are being monitored (or monitoring themselves) too closely, they tend to underperform--that is, they choke.
2. Rudeness Hurts. In a study by the University of Florida and the University of Southern California, people who were exposed to uncivil behavior were 33 percent less creative and four times less helpful than those who were not.
3. How to Kill Productivity. In a Georgetown University poll of 800 managers and employees, 80 percent said they had lost work time worrying about a rude incident at the office.