Judgment – Learn How Winning Leaders Make Great Calls

Tichy - judgment

Dr. Relly Nadler: Today our show features Noel Tichy, named one of the top 100 Management Gurus in the world by BusinessWeek, he is a professor, author, speaker, and world recognized expert on leadership behavior.

Dr. Tichy will discuss his newest book, Judgment: Learn How Winning Leaders Make Great Calls, who he co-authored with Dr. Warren Bennis.

Dr. Cathy Greenberg: We are so thrilled today to have Noel Tichy with us. He is a legend in leadership. I have had the pleasure of knowing Noel for almost a decade and he has certainly been one of my mentors, advisors, and I like to call him a friend, also.

He is one of the greatest names in leadership today. His most recent book has been winning awards all over and just named great book by many, many companies. I know that he is very excited about his brand new program with BusinessWeek, called Judgment Call. I’m sure he’ll talk about that today. He will be a regular byline both BusinessWeek Magazine and in their online programs.

He’s the senior partner in Action Learning Associates with clients including Fortune 500 names like Best Buy, GE, PepsiCo, Cocoa Cola, GM, Nokia, Nomura Securities, 3M, etc., I could go on and on. He and Warren have been commenting recently on the presidential elections and we’ll hear more. Welcome to the show, Noel.

Noel Tichy: Thank you so much. I’m delighted to be with you and your listeners. I look forward to this.

Dr. Relly Nadler: Thank you, Noel. We have a series of questions that we want to pick your brain about. One that we always like to start off with is can you tell us a little bit about yourself and who have influenced your thinking and career the most as a leader?

Noel Tichy: I would go all the way back to getting interested in this whole field and I ended up learning as an undergraduate at Colgate University about organization development. All of the sudden, my psychology major had some relevance to the real world. This was in the 1960s. I, as a result, went off to Columbia University to the Ph.D. program in Social Psychology because they were working with Morton Deutsch on conflict resolution focusing on both the cold war and civil rights issue. Matt Miles is part of that faculty, was doing work with Bankers Trust and Union Carbide and other companies on organization development.

I saw a relevant link to the behavioral sciences and making the world better and ended up teaching at Columbia Graduate School of Business from ’72 to ’81, and then moved to the University of Michigan in ’81. Probably the biggest shaping thing for me is the 70s being kind of anti-war and civil rights oriented, was selling out to the business school. I had to figure out I pulled that off

I ended up running the MBA/MBH program, MBA/MSW programs at Columbia. I got very involved in the South Bronx of New York with the Martin Luther King Health Center. In fact, the first book I wrote was on the neighborhood health center which was a phenomenal example of community development.

Then I actually left Columbia and ran Hazard Family Health Service, in Hazard, Kentucky, to see if we could do a rural version impacting healthcare status and training members of the community to be healthcare providers. I spend a year there in a very tough environment because the Appalachian Regional Hospital System that we owned when bankrupt that year and it was basically how do we keep the clinic alive. I learned an awful lot about myself and leadership and values.

Then the other big shaping event after I went to the University of Michigan was Jack Welch asked me to leave, I was CEO of GE at the time, in the mid 80s to go to General Electric and run their fabled Crotonville, the Leadership Development Institute and revamp it from a management development center to a leadership center where threw out every Harvard case we could get and said if you are going to learn, you are going to learn by doing real things. So we put an action learning platform in that resulted in senior leadership 4-week programs including sending executives off to Southeast Asia for 2 ½ weeks to find acquisition and joint ventures as opposed to sitting in New York reading cases.

I would say throughout my careers and moving in and out of the academic world, running a health clinic, running GE’s Crotonville, trying to help organizations develop leadership at all levels—kind of bottom line I’ve ended up with a very simple philosophy of leadership development. The worst people in the world to develop leaders are professors and consultants.

It is the job of leaders at all levels to be teachers. This goes all the way down to the kids in the store at Best Buy where we had kids teaching each other how to be more customer-centric, how to do a daily profit and loss statement, how to do customer segmentation, to CEOs. If you buy the notion that leaders have to be teachers, they need what I call, a teachable point of view for the organization to succeed. What are the ideas or strategy, what product services distributions channels, customer segments, what are the values that we need, how do we behave and how do we emotionally energize people?

That was the platform I had before Warren Bennis and I got together and said, well, what do you have a teachable point of view for? Well, you have it to make better judgments. We started looking at, Warren by the way—this is probably his 35th book and it’s my 12th— and I said, no one has written anything useful about how real live leaders make judgment calls. We write all of these prescriptive articles and publish them in Harvard Business Review and they have nothing to do with the reality of what we have seen in leadership.

So, we said, we are going to spend several years digging in and clinically talking to leaders about how they make big judgments in three areas: people, strategy, and crisis. People, who is on your team, or off your team. Strategy is what mountain do we climb, and crisis is what is going on, on Wall Street right now. Those are the three areas.

I would be delighted to talk about what we have learned in judgment, but the bottom line is every one of your listeners, hopefully, thinks of themselves as a leader. If they do, I challenge them to take on the mantle of being a teacher and develop the next generation of leaders.

Dr. Cathy Greenberg: Noel, as you are speaking I can’t help but think that the whole idea of judgment and teachable point of view is certainly a crucible for many leaders. I know that you and Warren often use that word, crucible. As we talk a little bit about judgment and how individuals actually get to be individuals who make good judgments, you could talk a little bit about what crucibles are.

Noel Tichy: Crucibles are those critical and printable moments where you really are tested as a leader. It’s at that moment that we really find out whether you have the right ideas, the right values, and you can emotionally energize people around you. It’s where you get imprinted as a leader.

In the Judgment book, we actually talk about a bunch of failed leaders, including some of our own failures in critical times and what we learned from them. Warren Bennis failed in some of his leadership as President of the University of Cincinnati. We look back and say, what did we miss?

I, as a leadership example at the University of Michigan, had one of my colleagues who I had worked with for 20 years, let me down through a bunch of lies that I didn’t see and program, where if I had gone back and connected the dots, I would have seen it. But, I almost had to lay off my whole staff.

The more we looked at leaders—Jack Master got fired at Ford in the middle of the Firestone tire crisis and I was there with him and got fired with him. What did we miss?

One of the things in a crisis situation, if you don’t have trusted, aligned people, so people come first, and secondly, then need a strategy so that you are not just flailing, without people and strategy you get into a crisis and you end up like Stan O’Neal at Merrill Lynch getting fired because he did not have aligned teams either on the board or below him, so he makes a mistake, he’s out. Carly Fiorina got fired at HP as the continued to move into a crisis and she hadn’t aligned her team.

We ended up with people, strategy, crisis, in that order.

Listen to the complete interview, above.



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