I had the opportunity to attend Great by Choice presented by Jeff Johnson.  For those of you who have not read the book, the premise is that,  “We cannot predict the future. But we can create it.”  While the book is intended for business audiences, the success factors described are very applicable to the nonprofit world.

Author, Jim Collins, shares what separates a great leader from an average or even simply good leader?

1. They are not more creative.
2. They are not more visionary.
3. They are not more charismatic.
4. They are not more ambitious.
5. They are not more blessed by luck.
6. They are not more risk seeking.
7. They are not more heroic.
8. They are not more prone to making big, bold moves.

They do share some common qualities, which are:

1. Fanatic Discipline – this is the ability to develop values, purpose, goals, and standards… and then stick to them over a long period of time with minimal variance.

2. Empirical Creativity – which is the process of looking to numbers to verify decisions.  Especially in difficult times it is the norm to look to “experts” or even “standard operating” to seek direction.  Great leaders find creative ways to test outcomes before committing large resources in any direction.  They use empiricism as the foundation for their decisions.

 3. Productive Paranoia – which means to operate as if terribly luck, or unseen competition is just around the corner at all times.  If you knew you were about to head into a horrible market or that a competitor was about to vie for your top clients, what would you do to be prepared?

4. Incredible Ambition – for the organization, not just themselves.

In “Great by Choice” they share an idea of the 20-mile march.  The idea is that, I will push myself to go 20 miles in the worst conditions, and limit myself to only 20 miles in the best conditions.  It is the drive to succeed no matter what comes against me and the discipline to hold reserves even if everything seems to be for me; because I know that conditions change, often without warning, and rarely in my favor.

Fanatic discipline requires the ambition to achieve and the self-control to hold back.  The key is to decide on a 20-mile march, and then reach it every month/quarter/year.  The productivity is linear, but the results are exponential.  A 20-mile march has these characteristics:

1. Clear performance markers

2. Self-imposed restraints

3. Appropriate to the specific enterprise

4. Largely within the company’s control to achieve

5. A proper timeframe, long enough to manage yet short enough to have teeth

6. Imposed by the company itself (not outside agencies)

7. Achieved with high consistency

Some questions to ask if  you develop your own 20-mile march are:

1. What must we accomplish in order to reach our goals and accomplish our vision?

2. What must we conserve to weather future storms?  What does it look like to be over-extended in a particular environment?

3. Are we willing to live with this 20-mile march for the next 15 years?

Empirical Creativity – Fire Bullets, then cannonballs. The goal in empirical creativity is to fire as many small probes as possible before committing large resources to an initiative.  This is called “calibrating” a cannonball.  Innovation, perse, is not the key to success in any industry.  New is not always better, it often depends on how many resources it takes to be new first.  Every industry has an innovation threshold which must be met in order for a company to survive.  But, after that threshold is reached it is much more important to be right than to be first.  And, right is determined by empirical data.

One question to ask as we continue is, “What is the innovation threshold for your industry?  How important is it that you continue to create new things, or are things like price, quality, and customer service more important?”

Quoting Great by Choice, “’Intel Delivers’ explains Intel’s 10x success much better than ‘Intel Innovates.’  Even more accurate, ‘Intel innovates to a necessary threshold, then blows everyone away-utterly, completely, fanatically, obsessively with its ability to deliver on its innovations, at expected cost, with high reliability and great consistency.’”

After deciding the innovation threshold, the next big issue is to use resources in the best, most efficient way.  Think about what signifies a bullet versus a cannonball in your organization.  Bullets have at least three characteristics:

1. Low cost (relative to your budget)

2. Low-risk (even if it completely fails it will not substantially hurt the organization)

3. Low distraction – it may completely distract one or two people, but not the entire organization.

Calibrate your cannonball, then fire.  There comes a time to gather all of your resources and move in a direction.  The important thing is to know, with empirical evidence, that you are calibrated before you fire.  The time always comes to take a large shot; without large shots there is no success.

Productive Paranoia – Leading above the Death Line

The Death Line is that point at which “the enterprise dies outright or becomes so damaged that it can no longer continue with the quest to become an enduring great company.”  There are three main practices that help an organization avoid the death line:

1. Build cash reserves and other buffers to prepare for unexpected events and bad luck before they happen.  The first step here is to identify what your most crucial resources are.  The next step is to stockpile those resources at what will seem an unusual rate; 3-10x your industry.  We do this because we know that the most damaging trials/storms/etc. are those that are unseen, severely strong, and guaranteed to hit.

2. Bound risk – Death line risk, asymmetric risk, uncontrollable risk.  Manage time-bound risk (at what point does your situation change?)  Death Line risk is defined as that risk which could kill or severely damage the enterprise.  Asymmetric means that the potential downside is much larger than the potential upside.  Uncontrollable risks are always present; they must be prepared for.  When it comes to time-bound risks the issue is not just “fast versus slow”.  A better response is “as fast as necessary, as slow as possible”.  The key question is “How much time before our risk profile changes?”  Take all of the time available, increasing vigilance if necessary (meaning, do what you normally do, just more of it) to make the best decision if time is short.  We can never eliminate uncertainty, but can limit it through a combination of good decisions, patience, and vigilance.

3. Zoom out then Zoom in: hyper vigilant to sense changing conditions and respond effectively.  Push for perfect execution of your process, and adjust to changing conditions.  One must be able to see the big picture in order to correctly calibrate short-term decisions.  We should always think and plan before we act, no matter how serious, big, or fast-moving a risk is.  We must also realize that “Not all time in life is equal. Life serves up some moments that count much more than other moments.”

Incredible Ambition – for the organization, not just themselves.  True success must come from a place of greater good.  Ambition for all, not just for one.

Take-away:

1. Get your own copy of this great book at Amazon.com.

2. Think about the four qualities of a great leader.  Are you doing too many events at the sacrifice of quality, are you firing cannonballs for new programs as opposed to bullets, does your nonprofit have cash reserves?  How can you take these qualities and apply them to your world?

Notes credit: Jeff Johnson & the Greater Leander Chamber of Commerce