May, 2007, Volume 11, Number 8

CONTENTS 

Leadership Speakers:  11th Annual Wharton Leadership Conference on June 7, 2007 

Leading with Religion:  Wharton Graduate and Megachurch Pastor Kirbyjon Caldwell Combines Faith and Finance

Learning from Fallen Leaders:  Why Reputation Is Everything

Don’t Go It Alone:  The Networking and Networked Aspects of Leadership

Leadership Wiki:  Center for Leader Development
 

LEADERSHIP SPEAKERS: 11th Annual Wharton Leadership Conference on June 7, 2007

Jennifer Deal, Stephen Harrison, Thomas Stewart, and Tim O’Toole are among those speaking at the June 7 Wharton Leadership Conference.  An interview with another of the speakers, Kirbyjon Caldwell, appears below.  Other speakers have been described in previous editions of the Digest and at http://leadershipconference.wharton.upenn.edu.   

Jennifer J. Deal, research scientist at the Center for Creative Leadership, manager of its World Leadership Survey and Emerging Leaders research project, and coauthor of Success for the New Global Manager (2002).

Stephen G. Harrison, chairman of Lee Hecht Harrison, a worldwide career  management services and leadership development company, and author of The Manager's Book of Decencies: How Small Gestures Build Great Companies (forthcoming).  

Thomas A. Stewart, editor and managing director of the Harvard Business Review and author of Intellectual Capital - The New Wealth of Organizations and The Wealth of Knowledge (2003).

Tim O'Toole, managing director and CEO of the London Underground Ltd., and former chief executive of America's Consolidated Rail Corporation (Conrail). 

Online registration for the conference is available at  http://leadershipconference.wharton.upenn.edu/2007/registration.html. 
 

LEADING WITH RELIGION: Wharton Graduate and Megachurch Pastor Kirbyjon Caldwell Combines Faith and Finance 

Growing up in Houston’s impoverished Fifth Ward, Kirbyjon Caldwell learned everything he needed to know about business at his father’s clothing store. Earning a Wharton degree years later also shaped his business sense. But shortly after launching his own business career, Caldwell said he was “called” to religious leadership. Today he is the pastor of the 15,000-member Windsor Village United Methodist Church in Houston, Texas, where he has pioneered innovative economic development projects. In March this year, Beliefnet.com, a leading religion website, named Caldwell – who offered the prayer at the 2001 presidential inauguration – one of the country’s ten most influential Black Spiritual Leaders.  

This month, the Wharton Leadership Digest caught up with Caldwell, who will be a featured speaker at the June 7 Wharton Leadership Conference, to talk about his passion for combining faith and finance. 

Wharton Leadership Digest: Tell us about your own story. You graduated from Wharton, and today you are a religious leader. We would have expected you to go into investment banking instead. 

Kirbyjon Caldwell: I expected to do that myself (laughs.) I have always had a keen if not passionate interest in transforming the economic infrastructure of communities. My dad owned a men’s clothing store, so I had entrepreneurial blood running in my veins since birth. When I graduated from high school, I wanted to make a difference, to help people in Houston, to “do good while doing well.” So I focused on economics as an undergraduate at Carleton College and later was accepted at Wharton.  

After I graduated, I went to work for First Boston on Wall Street, then moved to Houston to work for a regional investment banking house as a fixed income institutional salesmen. I’d been there three months when the “calling” occurring.  

WLD: Can you tell us about that moment of “calling?”  

Caldwell: The most intelligent statement I could make is to say it was an experience that does not readily lend itself to a verbal description. To put it in religious terms, it was a moment when I became eclipsed by God’s will. All I knew was I was supposed to stop selling bonds and start pastoring a church.

It’s been suggested there are at least two great moments in one’s life – one when you’re born, and the second when you discover why you’re born. 

I believe everyone is called to do something, and most of us, obviously, are not called into full-time ministry – for that I say thank the Lord, because that would be pretty boring. But we’re called to be more than a mom or a dad or a spouse. I think we’re called to leave an indelible imprint in this phenom called life.  

I encourage everyone to ask him or herself: “Why am I here?” There’s a reason why you were born – and there’s a reason why you’re still here. I don’t think you should go crazy trying to figure it out, but you should be alert and alive to and, hopefully, aligned with that purpose.  

WLD: After being ordained as a minister, you became the pastor of a church with only 25 members. Did that feel like a come-down for you, a person with two graduate degrees, suddenly in charge of only 25 people?  

Caldwell: Only 12 of whom came to church on Sundays (laughs.) I was assigned there by the [United Methodist] Church, and I believed God wanted met to be there, so I focused on that and went to work. Now we have over 15,000 members, and we take up more money in one worship service than we did that whole first year, and we have six or seven worship services a week.  

WLD: How do you explain that success? 

Caldwell: In spiritual terms, we had five keys: a winsome worship service, multiple magnetic ministries, a powerful prayer ministry, enthused and involved lay people and an entrepreneurial methodology. The sixth thing, which may not be meaningful for a business audience, but which is very relevant in today’s culture, is having a clear Christology [understanding and declaration of the person of Jesus Christ.]  

In business terms, we really understood our target population. Two, we delivered our product as excitingly as possible. We did all our work with volunteers and only a small paid staff – as you know, that can be challenging. So the third thing we did right was have an informed and enthused HR team.  

But here’s something else interesting. We did not care about the competition. We didn’t care what the other churches were doing; we just focused on what we were doing. Having said that, the real competition is not the church around the corner, it’s culture, it’s whatever keeps folks from going to church. We had a real kick-butt attitude, and in this case the butt was apathy, arrogance, ignorance and the status quo.  

And of course the financial pieces – managing cash flow, maximizing assets – we were doing that as well.  

WLD: How did your M.B.A. help you lead your church? 

Caldwell: My Wharton experience clearly contributed to my willingness to pursue “success” on a large scale. And of course when it came time for us to secure debt and raise capital, it helped to be comfortable with the nomenclature.  

Really, though, it was my experience working in my dad’s clothing store as a kid in Houston that has proved invaluable, in terms of interpersonal skills and the just down-right work ethic. I think it was the Houston Fifth Ward experience, combined with the Wharton experience, that helped me have the right attitude.  

WLD: Your latest book has the title “Entrepreneurial Faith.” What do you mean by that phrase?

Caldwell: Interestingly, when the word entrepreneur was originally coined, it had nothing to do with money. It was about identifying and galvanizing resources, particularly people, to pursue a common goal. Who better fit that description than Jesus Christ himself?  

Of course the more commonplace definition of entrepreneurship has to do with attracting economic and financial resources to make a vision happen. Beneath that is the notion of having a mission and deploying every resource you can get your hands on to make that a reality – at the end of the day, that’s what a real entrepreneur does.  

WLD: Some people might resist the idea of mixing business and religion. Is it a contradiction to mix faith and finance?  

Caldwell: Not at all, in my view. Faith and finance were never intended to get a divorce. Rather, God intended them to be in a healthy relationship. The Bible has more verses on money and commerce than it does on faith, prayer, heaven and hell combined. Go figure. What has happened is, theologians and lay persons have misinterpreted and misapplied that teaching on faith and finance. God has blessed us to be a blessing to others, and that has an economic meaning too.  

WLD: Why was economic development important to you and your church? Why not just focus on getting more church members? 

Caldwell: The area of Houston I grew up in – the Fifth Ward – was underserved, to say the least. Since very early on in life, I’ve had a desire to make a difference in the community. So when I went into the ministry, making a difference economically was part of my agenda. It’s just a passion I have.

Point Two Three Four, 234-acre is a multi-use community we are developing in Houston. It consists of Corinthian Point, a YMCA, a public school, an independent living facility, a community park, and an 8.5 acre commercial development, currently anchored by Walgreen’s and CVS. Understand that in this neighborhood, there were no drug stores. Corinthian Point is the largest residential subdivision ever developed by a non-profit entity. There are 464 homes, and 80 percent of the homes are low- to moderate-income housing, though you wouldn’t know that by looking at them – they’re very nice. We are also developing a 451,000 square foot community center, which would include a charter school, a NASA program and the sanctuary, the family life center – it will literally be a smorgasbord of spiritual and social services.    

This community is literally being transformed. The houses are already up, people are already living in them. From a spiritual standpoint, it’s unscriptural not to own land. God wants us to own land. From a social standpoint, statistics are clear: when people own land, education levels go up, crime comes down and life is made by better. There are positive spill-over effects.  

Note:  This interview was conducted by Andrea Useem (http://www.religionwriter.com), whose articles on religion and other topics have appeared in The Washington Post, The Chicago Tribune, Knowledge@Wharton and other publications.
 

LEARNING FROM FALLEN LEADERS: Why Reputation Is Everything

By Jeffrey Sonnenfeld and Andrew Ward  

Is it possible to rescue your career and restore your reputation after a major professional setback?  In an age rife with press accounts of disgraced CEOs, politicians and celebrities – as well as courageous but beleaguered whistle-blowers and victims of rivalries or envious colleagues and bosses – this question has grown more important than ever. 

  In our book Firing Back: How Great Leaders Rebound after Career Disasters (Harvard Business School Press, 2007) we answer this question with a resounding “yes.” Our interviews with some 300 derailed CEOs and other prominent figures brought to light five key steps for rebounding from career disaster. Anyone trying to recover from a catastrophic career setback can use these steps to match, or even exceed, their past accomplishments: 

Fight, Not Flight: In responding to the setback, avoid the temptation to hide and lick your wounds. Instead, face up to the reality of the situation and distinguish those battles that need to be fought to restore reputation from those that simply drain energy and purpose. 

Recruit Others into Battle: Friends and family can provide support and, hopefully, some much-needed perspective at this hour of need. Use your support networks while recognizing the collateral damage inflicted on these individuals as the result of your downfall.  

Rebuild Heroic Stature: Put the event in context and provide a rational explanation to others, thus allowing the rebuilding of reputation. 

Prove Your Mettle: After suffering career disaster, you may doubt your ability to get back to the top. Find the courage to prove to others – and yourself – that you have not lost your magic touch. 

Rediscover the Heroic Mission: It is the single-minded pursuit of a lasting legacy that sets great leaders apart. Clear the past and chart the future by defining a new meaning for your work and life.

 Answers to our research questions 

Our research shows about 40 percent of failed CEOs disappear from the workforce. We asked, why are some leaders unable to move beyond failure? We discovered four main reasons failure is so hard to manage, and all relate to the emotional impact of losing a job. First is the stigma of job loss and the shame associated with it – both for leaders and those associated with them. Some leaders feel rage about the circumstances of their job loss, and others are in denial. When a leader is sucked into this emotional whirlpool, it is sometimes impossible to get out. A key step, then, is to confront and acknowledge failure – even if that failure simply involved a underestimation of others’ Machiavellian politics.  

A common thread throughout our book is the idea of resilience and reputation saving. Reputation, we found, is everything. When leaders see their success spiral smacking into a wall of failure, they should step back, catch their breath, and then embrace the obstacle itself as a fresh opportunity to overcome challenges. At the same time, they must recognize this new mission cannot be achieved alone. They need to draw upon the reservoir of their early career experiences and personal and professional networks. The worst misstep they can make is to allow other people to tell their story and therefore design their future.  

In our research, we asked whether the reason leaders are fired determines their chances for career recovery. We found the cause does impact their ability to return to a position of power. The more the offense impacts the executive’s personal reputation, the less likely career recovery becomes.  

We studied hundreds of career exits and grouped them into six main reasons for forced exit: Poor corporate performance, personal misconduct, illegal and improper behavior, a strategic disagreement, a political or personality clash, and a merger or takeover. As expected, illegal or improper behavior had the greatest negative impact on a leader’s reputation and also most negatively impacted a CEO’s chance at a new job. But even in this category, rebound was still possible.  

Consider the story of Michael Milken. One of the best known investors of the 1980s, personally earning over half a billion dollars in 1987, he was led away in handcuffs, fined a billion dollars, and jailed for two years. Known as “The Junk Bond King,” his reputation was blackened, and he was banned for life from the securities business. Ten years later, after serving his jail time and battling cancer, this same man has raised more than $260 million to fight prostate cancer; his charitable foundation carries his name; and he is lauded as a generous and giving person. He also created an educational company, Knowledge Universe, which went from nothing to over $1.5 billion in revenues in four years. His current success has dimmed memories of his earlier failings, and he has come back from disaster with a new mission, every bit as powerful as before. We found it amazing how powerful reputation recovery can be. 

Author’s Notes: Jeffrey Sonnenfeld is Senior Associate Dean for Executive Programs at Yale University’s School of Management, where he is the Lester Crown Professor of Management Practice as well as founder and President of the Yale Chief Executive Leadership Institute. Andrew Ward is a member of the management faculty at the Terry College of Business, University of Georgia.
 

Don’t Go It Alone: The Networking and Networked Aspects of Leadership 

By Mark Hanna 

Change can prompt slumbering capabilities to awaken. A good thing, because to navigate a challenging life passage successfully, one must achieve a higher level of functioning. "As our case is new, so we must think anew and act anew," said Abraham Lincoln to Congress at a critical moment in the nation’s history.

When a manager assumes a leadership position, he or she must also develop effective new viewpoints, skills, and behaviors to survive and thrive. Developing broad, high-level social networks is one key step new leaders must take. 

Two recent Harvard Business Review articles expand on the connection between social networks and effective leadership. In their January, 2007, article, "How Leaders Create and Use Networks," authors Herminia Ibarra and Mark Hunter, both affiliated with INSEAD, the graduate business school, discuss the kinds of networking leaders must do to create effective change. "In Praise of the Incomplete Leader," a February, 2007, article by Deborah Ancona, Thomas W. Malone, Wanda J. Orlikowski, and Peter M. Senge, all affiliated with the MIT Sloan School of Management, demonstrates how leadership itself can be networked, and how such “distributed leadership” can relieve the pressure to be a "perfect leader."  A brief summary of these two articles follows. 

“How Leaders Create and Use Networks”  

Ibarra and Hunter followed the successes and failures of a group of managers as they transitioned to leadership positions. For many of the new leaders, networking was an obvious part of their jobs, yet it proved to be one of their most dreaded challenges. Watching these emerging leaders, the pair discovered that three distinct but interdependent forms of networking: operational, personal, and strategic.  

Operational networks are comprised of individuals, mostly internal to the organization, who are helpful in getting work done efficiently. These individuals can meet objectives as assigned, but are not well-suited to asking the strategic question of “What should we be doing next?”  

Personal networks are those that can enhance personal and professional development. Usually consisting of professional associations, clubs, alumni groups, and personal interest communities, these networks are a valuable source of referrals for information and contacts. 

Strategic networks can help leaders set future priorities, meet challenges, and get stakeholder support for critical changes. The contacts are internal and external to the organization and are oriented toward future issues. These networks are difficult to develop because membership is discretionary, and it is not always clear who is relevant.  

Ibarra and Hunter made some fascinating discoveries. First, as managers struggled to widen their professional contacts, they often shifted their focus from operational to personal networks. However, unless managers learned how to make those connections relevant to organizational strategy, these expanded operational and personal networks were unlikely to affect key organizational changes.  

Second, Ibarra and Hunter observed that almost all of the managers they studied underutilized strategic networking. This form of networking can be difficult because it absorbs a significant amount of time and energy that managers usually devote to internal operational demands. Some tended to dismiss strategic networking as “political” and something to be avoided, while others let interpersonal chemistry, and not strategic needs, determine which relationship they cultivated. Those who followed these paths typically failed to develop the key inside-outside links that would have promoted their company’s strategic advantage.  

What should individuals do to develop their networks?  Ibarra and Hunter offer this advice: 

Mind your mind set: Attitude counts. Decide that networking is a key priority in the new job. Have a good role model to emulate. 

Work from the outside in: Reach out to individuals outside your organization to multiply your knowledge and contacts. Then use the information gleaned as a “hook” for making internal connections. 

Re-allocate your time: Delegate some internal tasks and responsibilities so that more time can be spent on networking. 

Ask and you shall receive: Get active with your network, actively giving and receiving information. Help connect two people who would benefit from meeting each other.  

Stick to it. Allocate enough time and effort to make it pay off. Sometimes this is more a matter of will than skill.  

Yes, leaders need to network. But as the next article shows, leadership itself sometimes needs to be networked.  

“In Praise of the Incomplete Leader” 

Is there such a thing as a “complete leader?” This label is applied to the supremely talented individual, skilled in all ways, who can be everything to everyone. Any nominations? Ancona and her colleagues challenge the myth of the complete leader, arguing in their article that “only when leaders come to see themselves as incomplete – as having both strengths and weakness – will they be able to make up for their missing skills by relying on others.”  

The authors develop a model of “distributed leadership,” in which the leadership function is jointly provided by two or more individuals. Incorporating others into the leadership role is essential for in four different areas: 

o  Sensemaking: understanding the context in which a company and its people operate;

o  Relating: building relationships within and across organizations;

o  Visioning: creating a compelling picture of the future;

o  Inventing: developing new ways to achieve the vision. 

Ancona and her colleagues don’t claim that leaders should avoid working on their weaknesses in any of these four areas – in fact, the article has several excellent sidebars with suggestions for making personal improvements. Rather, they suggest that leaders must surround themselves with people who have complementary skill sets.  

Typically, leaders are strong in one or two capabilities. Andy Grove of Intel is the quintessential sensemaker. Herb Kelleher, former CEO of Southwest Airlines, excels at relating. Steve Jobs is a visionary who has proven his skills again and again at Apple, Next, and Pixar. Meg Whitman, President and CEO of eBay, helped bring founder and Chairman Pierre Omidyar’s vision of online retailing to life through a number of innovations designed to enhance the eBay experience for buyers and sellers alike.  

Once leaders diagnose their strengths and weakness, they can search for those who can fill in the gaps, a process the authors call “balancing the four capabilities.” Doing so can simultaneously improve the functioning of the organization while lowering expectation pressures on the chief leader. Write Ancona and her colleagues: "It’s time to celebrate the incomplete – that is, the human – leader.” 

Concluding Observations 

Together, these two articles show how social networks help leaders achieve a broader, higher, and more efficient level of functioning. Using both strong and weak ties in one’s operational, personal, and strategic networks can bring about desired organizational change. At the same time, one can use “distributed” or networked leadership approaches to lessen some of the position’s psychological pressures. One does not have to be all things to all people. This approach is like the overdrive mechanism in a car, which allows the engine to operate at a lower RPM for a given road speed. Otherwise, one’s leadership engine might overheat.  

Author’s Note:  Mark Hanna is a freelance business writer based in Cedar Rapids, Iowa. He can be reached at markhanna@mchsi.com.
 

Leadership Wiki:  Center for Leader Development 

The Center for Leader Development provides individuals with an interest in leadership development a place to connect, learn and share. The CLD website includes sections such as the interactive CLD Leadership Wiki which includes information on leadership education programs, articles, books, and other media. The CLD Blog gives visitors the chance to learn about the latest in leadership and exchange ideas and news with other leadership students and professionals. Finally, visitors will find leadership development resources, job links, tools, conference announcements, publications and information-rich content designed to help leaders at all levels.