Case 1: EverBank Commercial Finance

We worked with one remarkable leader, the late Jim McGrane, for two decades in three different companies. We first met Jim 20 years ago when he was leading a prominent division of Heller Financial. In our first meeting, we realized that Jim was a serious student of leadership. He had already worked with several thought leaders in our field to design his organization for high performance. In making the Leadership Development Agenda a strategic priority, Jim proved the close connection between leadership effectiveness and business performance.

Jim called us in late 2005 when he was CEO of US Express Leasing (USXL), a start-up commercial finance company. He was surrounded by a team of highly capable industry all-stars. He had worked with them over many years. Together they grew the business from startup to one of the fastest growing companies in the industry. They raised an impressive amount of money: $125 million in equity and $700 million in debt (over time); gained industry prominence, ranking as one of the top 25 companies in the monthly leasing index; created a culture that provided a predictable, consistent, and reliable customer experience with 95% customer and employee satisfaction; and grew assets under management from $45 million in 2004 to $700 million by the end of 2006. USXL became one of the top 100 largest and the fastest-growing U.S. commercial finance/equipment leasing companies. They attained that success by operating under the values of integrity, passion, fun, accountability, and respect.

In 2006, USXL was preparing for an IPO targeted for 2008; however, their fast growth had triggered heightened investor expectations and a shift in the focus of the leadership team from internal to external stakeholders. When Jim contacted us, he had decided that he needed to take the team's effectiveness to the next level to prepare them to take on future challenges. He expressed confidence in his Top Team going from good to great. We told Jim that improving on a good leadership team is even more difficult than moving a poor team to average because of the team members' lack of a perceived need to work on team effectiveness and their resistance to focusing on team development and leadership effectiveness while growing the business.

For 18 months, from late 2006 to mid-2008, we worked with Jim and his team to increase their performance and effectiveness. We used a qualitative methodology to assess where the team was effective and ineffective. Beyond establishing a baseline of their effectiveness, we also observed and participated in their team meetings and we conducted individual interviews.

Jim's 2007 LCP. In 2007, we ran Jim's first Leadership Circle Profile (LCP).

In Figure 7.2 we see that Jim's Creative scores across the top half of the circle averaged at the 93rd percentile. Leadership ineffectiveness or Reactive scores averaged at the 46th percentile in the bottom half, resulting in a LQ of 2.0. His Leadership Effectiveness scores averaged 80%, putting Jim in the top 20% of effective leaders. Jim's profile is as strong as or stronger than the leaders whose business ranked in the top 10% of highest performing businesses. Given his profile results, it is not surprising that he was leading a company that was becoming a rising star; his leadership was clearly a competitive advantage. Over 18 months, Jim improved team performance and individual and collective leadership effectiveness, aligned and focused the Top Team, and improved relationships.

Tiger by the Tail: 2008 to 2011. After our initial work with Jim and his leadership team in 2006 and 2007, the economy weakened just before the meltdown in markets from 2008 to 2011. There was a huge dislocation in the financial services industry. To capitalize on recession opportunities, Jim and his team turned to the capital markets and in May 2008 they were purchased by Tygris, a new private equity backed venture. Tygris is Latin for tiger, symbolizing strength, swiftness and vitality. Like a tiger, Tygris raised $2.1 billion from 90 investors. This was the largest capital raise in the industry up to that point in time. Jim and his team became part of the Tygris leadership team.

In July 2008, we worked with the new CEO and the senior leadership team. During that time, the team agreed on the new vision and values, structure, strategy, and the initial action plan.

Tygris was off to the races, filled with hope and a story of a bold move, counter market, right into the teeth of the recession. By early 2009, the newly formed business was moving toward obtaining a bank charter that would have given Tygris funding critical to its success in the midst of the capital market's turmoil. Unexpectedly, the bank charter was not granted, sealing the company's fate. With all of the hope and promise that had marked the start of 2009, Tygris was on life support as a business at the end of that year. There was no longer any material production (sales and business development had slowed to a crawl) and obviously the employees knew that Tygris was in trouble.

At the time, Jim and his original USXL team were operating as Tygris Vendor Finance. They operated with a cloud over their heads as Tygris considered its options. “We thought it was a marriage made in heaven, but that has not turned out to be the case,” said Jim. Assets under management fell from a high of $800 million to $500 million, and new business dropped from $400 million a year to $135 million. One leadership team member described the scene: “After the first few months in 2009, we could see that Tygris would not continue. There was lots of anger at management, many emotions came out, and leadership eroded.” During this time, the credibility of Jim's leadership team was damaged, as reported: “People loved USXL. There was pride in the brand, the slogan, the company. USXL was flat and egalitarian. That was lost as Tygris went into preservation mode.” With all the difficulty described, the reality was that Tygris made it possible for the company to survive and stand to fight another day. If not for the denied bank charter, it could have turned out very differently. As it stood, the net result led to the best possible scenario.

The Tygris investors were actively trying to sell the company. EverBank came to the table as an opportunistic buyer, and in the process something amazing happened. EverBank leaders were impressed by what Jim and his team had achieved and by what they knew was possible for the business with the right owners. Jim saw this as an opportunity to rebuild and achieve his team's original vision. When EverBank officers met with his team, they chose to buy and invest heavily in Jim's legacy business, including its leadership team. As Jim told us: “Initially, they were only looking at purchasing a portfolio, but then our leadership impressed them. EverBank bet on us as leaders and we had to perform against their faith in us.”

As Blake Wilson, the President and Chief Operating Officer of EverBank, stated: “I spent the day with Jim and his management team and did a 180. They had built a real company that had a different asset class from us with some similarities. This was an intact leadership team with a company poised to grow. I knew it was a fit. Even after everything they had been through, they brought a strong leadership team with many strengths.” This was a big endorsement of Jim and his team and the company they had started out to build.

Back on the Scene. At the start of 2010, we reengaged with Jim and his team and worked with them to pick up the pieces and reengage their Leadership Imperative. We ran another round of Leadership Circle Profiles and Jim had a wake-up call regarding his leadership and the team's collective leadership. Figure 7.3 shows Jim's profiles in 2007 and in 2011.

By comparing the LCP results, we can see that Jim's LQ went from 2 to 1: his Leadership Effectiveness during that time was cut in half, meaning his leadership was no longer a competitive advantage. He was neutral in his influence.

Jim realized that at a time when he needed to be most creative, his leadership effectiveness had slipped from where it was in 2007. This wake-up call got his full attention. In fact, during the week, between when he received his results and the time we met with him to talk about his results, he conducted over 25 one-on-one interviews with his key leaders. He put both profiles on the table, and asked them, “What happened to me?” and, “What do I need to do about it?”

Few leaders are so committed to their effectiveness! Everybody agrees: effectiveness outperforms ineffectiveness. We often ask questions like, “How effective are you; how do you know?” or, “How much of your time and attention, personally and collectively, goes into the strategy of developing leadership?” These questions are interruptions for most leaders. In contrast, Jim concluded: “I am the problem. At a time when my leadership was most needed, I slipped into Reactive mode.”

Jim had a second wake-up call. When he saw the Group Profile of his senior team, he realized he had not done what he needed to do to develop the leadership effectiveness of his team. He resolutely went about addressing this over the next two years.

Figure 7.4 shows Jim's senior leadership team in 2007 and 2011. Note that they slipped further into Reactive, and more toward Complying, meaning they were complacent. Their LQ went from .86 to .76, meaning their leadership was less of an advantage. Now the whole team, with Jim at 1.0 and the team at .76, was playing below average—not-to-lose.

Levels 3 and 4 were made up by about 30 managers. Their Group Profile averaged at the 25th percentile with a low LQ of .5.

We then charted, for Jim and his team, the relationship between their collective leadership effectiveness and changes in their business performance. Figure 7.5 shows the relationship between Business Performance and LQ scores from 2007 to 2010.

When Jim saw the LQ scores going down and business results following suit, he concluded: “This needs to start with me, and then we need to work on our collective leadership. I have not developed collective leadership. I have not brought along my people. I will change that. To scale the business, we need to scale leadership, and that is my job.”

The Leadership Development System. In 2010, when we reengaged with Jim, we were prototyping what we now call the Leadership Development System—a multi-year process. Jim readily signed up to be one of our pilot groups. As we proceeded, we primarily focused on developing the individual and collective effectiveness of the leadership system. However, in parallel, Six Systems work was going on, including a major process redesign to streamline the organization for effectiveness, customer focus, and to position it for growth.

The Leadership Development System implementation (see Figure 7.6) began with readiness building—understanding why we were doing it and what we were trying to achieve, strategic communication, assessments (LCP and Leadership Culture Survey), and with an official launch once that work was complete.

We then conducted a half-day Promise of Leadership, an interactive development session, with the ELT. This was a half-day introduction to the LCP, wherein we covered the relationship between effectiveness and performance and provided an overview of the Universal Model, feedback on profile results, and held a LCP debrief with each leader by a seasoned coach.

Over a two-year period of time, Leader-to-Leader sessions were conducted. Each session was facilitated face-to-face, contained a key leadership development content element, and involved peer coaching and accountability. Each session was short, powerful, focused on the inner and outer game of leadership and focused on real business challenges. At the end of each session, leaders committed to work on something to improve their leadership between sessions, and at the next session, we start with a review of what they tried and how it worked.

As Leader-to-Leader sessions began we also created, with each leader, an actionable development plan and constructed a Pulse Survey. A Pulse Survey contains a measurable leadership improvement goal, one Creative Leadership Competency improvement goal, and one Reactive Behavioral change goal. Pulse surveys went out every few months to assess progress on development goals. Figure 7.7 shows an example of the results of the ELT's aggregate pulse survey. Approximately 88% of leaders were showing positive improvement and 25% were showing much improvement. These are big shifts in measured performance over a short period of time.

Pulse results were also plugged in to the Leader-to-Leader sessions as a way to measure effectiveness and create peer accountability. The entire team got to see their individual and collective progress ensuring that the whole system was engaged and committed.

This was the Leadership Development System we used with Jim and his team. We worked the whole Leadership System and the development conversation happened inside the business conversation. Jim's leaders were looking at their business issues from the perspective of “how do I need to lead more effectively to improve business results?”

The Results. Figure 7.8 shows the change in Jim's Profile from 2011 to 2013. We see a big reduction in Controlling scores (and everything on the Reactive half) with corresponding increases in the Creative half of the circle. Jim's LQ increased from 1.0 to 2.0.

Figure 7.9 shows the change in Jim's senior team. Creative scores increased across the board. Reactive scores, particularly Complying, were significantly reduced. This group was now really showing up as a group of effective leaders. LQ scores doubled from .76 to 1.6, and their LQ went from a competitive disadvantage to a serious competitive advantage.

The ELT (L-3 and L-4) also doubled their effectiveness, improving from .5 to 1.0. While there was still more work to be done here, they went from being a competitive disadvantage to being competitive.

Figure 7.10 shows the relationship between changes in LQ scores and business performance during this period of time. From 2011 to 2013, assets under management went from a low of $500 million to $2 billion, quadrupling the business! New business origination went from a low of $135 million in 2009 to $1.4 billion in new business—a huge turnaround. Their LQ scores paralleled their performance.

Jim was elated with these results and became an advocate, along with several of his team members, for focusing on effective leadership to drive business performance.

Tragically, shortly after this turn-around, Jim began to feel physically unwell. Two weeks later he was admitted to the hospital, and he never came out. He passed in February, 2014.

When Jim passed, one of his long-term senior leaders said to us: “Now we will find out if we are serious about collective leadership effectiveness.” Another team leader said: “When we cleared out his office, I did not want anything, except his original Leadership Circle Profile. I want that on my desk every day as a reminder of the leadership that I aspire to.”

Jim leaves a huge vacuum, but he also leaves a huge legacy with all the people that his leadership touched. Jim was one of our practice partners. We learned more from Jim and his organization than they ever did from us. This is how we do our work. We practice together on each other. We learn together. So we intend to carry on what we have learned from Jim and his legacy. After several years of working with us to implement a systemic approach to developing effective leadership, Jim said: “You have cracked the code. The work we have done with you has positioned us for sustainable success. We could not have done it without you.”

In Honor of Jim McGrane: Equipment Leasing Foundation Study. Rarely does an entire industry assess its leadership effectiveness; however, in honor of Jim McGrane, that happened in the Equipment Leasing & Finance (ELF) industry. As reported by Richard D. Gumbrecht, Chairman of the ELF Foundation, the ELF study, Leadership: The Next Productivity Frontier, determined the current level of effectiveness of leaders in the industry and identified how leadership effectiveness impacts performance. It also identified the best practices for creating and enhancing leadership effectiveness and specific management challenges that future leaders must address to ensure success.

The research team interviewed 32 executives from 26 ELF organizations to assess perceived impact of leadership, importance of leadership development, current professional development efforts, and expectations for the future. It also administered The Leadership Circle's Leadership Culture Survey to 162 leaders in 17 lessor organizations. This instrument reliably measures how respondents describe both the effectiveness of their current leadership culture and their desired, optimal leadership culture. In memory of Jim, here is a brief summary of the results.

1. Effective Leadership has a positive impact on performance. Leaders were asked to rate the impact that leadership has on their organization's performance. This metric was found to correlate highly (r = .73, p < .002) with Leadership Effectiveness scores from the Leadership Culture Survey. This correlation is quite high and further substantiates the research reported earlier—a more effective leadership culture creates a more successful organization.
2. Growth rates were substantially higher in effective leadership cultures. The study compared the business performance of the most and least effective leadership cultures. Organizations rated as having the most Creative leadership, better than 50% of the organizations included in this study, averaged 11% year-over-year growth. Those that rated lowest, in the bottom 50% of the organization in this study, had a 2% growth rate. This study found a 9% growth rate difference between the most and least effective leadership cultures.
3. Development of tomorrow's effective leaders needs to begin today. When executives were asked about the challenges leadership will need to address to ensure the future success of their organization and the industry, three common themes emerged:
   • Leading in a changing environment—maintaining a long-term perspective while creatively adapting to new technologies, regulations, acquisitions, and global demand.
   • Attracting and retaining qualified talent—ensuring the right people are in the right jobs and that they have the appropriate grounding in the industry.
   • The generational leadership gap—the need to develop the leadership skills of Millennials to fill the void left by the exodus of a “graying cadre of leaders.”

The study concluded that its findings and each of the above challenges, “underscores the importance of launching an intensive leadership development program that provides opportunities for the younger generation to learn from more experienced leaders and to develop the skills that will impact performance. ELF organizations that have quality leadership development efforts are more likely to grow competent leaders, and leaders who possess strong creative competencies are more likely to foster a thriving culture in which productivity soars. Thus, the sooner development work begins, the greater the likelihood that sustainable productivity will be achieved.”

Case 2: Global Shared Services, McDonald's Corporation

As the world's leading foodservice retailer serving nearly 70 million customers daily in more than 100 countries, McDonald's recognizes the importance of having good people in place in order to deliver an exceptional customer experience. McDonald's has a rich history of developing leaders. Founder Ray Kroc, once said, “As long as you're green, you're growing.” McDonald's supports this philosophy and commitment to their people by providing opportunity, nurturing talent, developing leaders, and rewarding achievement. This is evident in McDonald's tradition of promoting from within: nearly half of corporate managers and 60% of owner-operators started as crew members.

For many people, McDonald's represents a first job—a place to develop basic skills that can help them achieve success in future life pursuits. For others, McDonald's represents a pathway to a long-term career that provides rewarding opportunities to grow, contribute, and advance over many years. McDonald's values state their belief that a team of well-trained individuals with diverse backgrounds and experiences, working together in an environment that fosters respect and drives high engagement, is essential to their continued success.

Shared Services Business Challenge. McDonald's Shared Services team began their partnership with us in 2008. At that time, Shared Services was part of McDonald's IT group, which was decentralized in structure, but needed to function as a cohesive team to drive common global solutions. The CIO recognized the importance of developing teamwork and alignment across IT leaders and engaged us to lead this effort. After the IT Leadership Team had gone through The Leadership Circle process, the CIO asked each of the officers, including Kelvin McLaurin, then VP of Shared Services, to engage their teams in the program.

Soon after The Leadership Circle was introduced, the Shared Services organization evolved into Global Shared Services (GSS) and became the first global function at McDonald's. McLaurin recalls: “We needed to build a diverse, global team with leaders who could expand beyond their current capabilities.” He wanted to establish leadership effectiveness as a priority early with the team he was building and leverage the Leadership System to make this a reality.

In 2012, McLaurin transitioned to a role leading McDonald's Finance Transformation. Debbie Ballard, who had been a member of the GSS Leadership Team since 2005, took over leadership of the GSS organization. Having experienced the value of The Leadership Circle, she was already a supporter of the Profile and its benefits. Ballard explains: “The Leadership Circle process helps me professionally and personally. It enables me to step back and see why I am behaving the way I am behaving, and it helps me grow as a leader and to model the things that I am asking my leadership team to do.” GSS continued their focus on leadership development and further engrained The Leadership Circle program into its culture.

Strategic Solution: The Leadership Circle. When The Leadership Circle was introduced in 2008, the GSS leadership team was skeptical. Introducing an exercise that required not only getting feedback about individual strengths and opportunities, but then sharing publicly with their fellow team members would not be easy. However, the team committed to the process, knowing the first session would be hard, but trusting that outcomes would make it worthwhile.

Despite the initial hesitation, the GSS has become the group that applies The Leadership Circle most holistically and consistently. While other groups at McDonald's leverage the Profile, GSS is unique in that they continue to use public feedback with each team member talking about their strengths and weaknesses in front of the group. McLaurin explains: “The Leadership Circle has become the common language across the GSS Leadership Team to onboard and develop our leaders.” As new members join the leadership team, either from GSS or a support partner, they are expected to participate in The Leadership Circle. GSS also engages their high-potential managers in the process. In 2014, GSS added The Leadership Circle Pulse Survey to hone in on opportunity areas and ensure more frequent feedback to drive development in those areas.

McLaurin, who now leads Finance Transformation, brought The Leadership Circle practice to his new leadership team as well in September 2014. In addition, the Finance Transformation team also incorporated individual LCP assessment with team development opportunities.

Outcomes. The Leadership Circle helped GSS to become a true, shared leadership team and build a culture of openness, support, trust, and high performance. Ballard explains: “It is part of our DNA, part of who we are. We have now done multiple offsite meetings with our leadership team focusing on individual and collective effectiveness. As a result, we have forged a cohesive, high-performing leadership culture and system.”

Team members are empowered to mentor each other, talk openly about their opportunities, and gain support using a common language. Each leader's candor, paired with their support for one another, enables GSS to drive business results at an accelerated pace. Instead of ignoring issues that could hinder progress, the team talks through them.

Since the team respects The Leadership Circle process and one another, gaining awareness of strengths creates a culture of trust and support. Ballard notes: “Leaders were afraid at first of publicly showing people their development opportunities, but then they see that this supportive environment is designed to help you become a better leader, not discourage or embarrass you.”

The culture that The Leadership Circle has helped to create in GSS contributes to their success: “We achieved our five-year strategic plan in only three years, and then set in place the GSS 2020 Strategy to continue our momentum toward our vision to be a world-class shared services organization.” Both McLaurin and Ballard continue to be strong advocates for The Leadership Circle process, driving application in their organizations and sharing their experiences with others in the McDonald's System.

Case 3: Honda Precision Parts of Georgia (HPPG)

In response to the Leadership Imperative, one strong plant manager, Mike Jett, made leadership development a strategic priority and achieved impressive results. Mike has been the Plant Manager for HPPG since 2009. He epitomizes what makes Honda such a great company. In 2012, Mike was invited to join a group of high potential leaders in a year-long leadership development effort called the Honda Leadership Summit (HLS). Two groups of senior leaders come together twice every year to start this process of developing their leadership. This program is designed and led by the Honda OD Team, along with several of their executive leaders. In 2011, Honda asked us to work with them on part of the design of the core residential development program, a five-day program followed by a year of work.

HLS includes the Leadership Circle Profile and the Promise of Leadership workshop—an orientation to the model and the developmental framework, and a debrief of the LCP results. In addition, we work with the leaders throughout the entire year of their program. We use our Leader-to-Leader process—face-to-face and virtual development sessions focused on specific topics, peer coaching, and accountability. In addition, the Honda OD team facilitated “home room” coaching groups every other month to work on live leadership and business-relevant issues. The year culminates with a presentation to the Board of Directors on what was learned and what impact the year had on the operations. This is a systemic, whole systems program that follows all of the criteria of what makes for effective leadership development.

Upon his return from the Honda Leadership Summit, and over the course of the following year, Mike engaged his entire leadership team in development at HPPG. His enthusiasm and support for the work could not be contained. He leaned in and played full-out. Initially Mike helped his leadership team at HPPG realize that they faced a huge leadership challenge: If we do not evolve our ways of leading, individually and collectively, we cannot compete. They started to treat the development of effective leadership as a strategic imperative.

When Mike received the results of his first profile, he was shocked. “Before receiving the results of my first profile, I was very confident, even cocky, in my management capabilities. I thought that I was a good leader. When I received my LCP results, I think I cried for a week.” See Figure 7.11.

In our debrief with Mike, we discussed with him the key patterns evident in his Profile. He said: “The LCP feedback helped me see my strengths and weaknesses. I did not realize how bad I was as a manager until I got the results, but I learned from it. In fact, I kept my first LCP on my desk for well over a year. I would come in early every morning and look at it. That motivation helped drive the things I wanted to change because I did not want to be the person that the LCP said I was. Once I realized where I was, I set goals to get where I wanted to go and identify what characteristics I needed to develop.”

Mike continues: “When I shared the material with my team and showed them my LCP results, they were able to give me examples of my behavior. Even though this hit home hard, those discussions were extremely positive. It led to many courageous discussions. I took that feedback and put together a plan for how I would change. For example, I am a very controlling person. It is hard for me to let go. I have really had to force myself to let go. And what I have seen is that the more I let go, the more responsibility and accountability the division managers below me take. So when there is a crisis situation, instead of jumping in and taking control, I am letting my leadership team do that. That was hard for me to do in the beginning. But I see them take more responsibility and accountability on themselves to lead in those situations.”

Mike never looked back. He engaged his entire plant as well as his leadership team in this work. “Since then we have had several follow-up sessions and aggressively applied what we learned to our operations here.”

Mike says that he can laugh about that first LCP now because his second LCP was 100 percent better: “The second one was what I wanted the first one to be.” (See Figure 7.12).

What is it about the LCP that drives such meaningful change? Mike answers: “The LCP is very descriptive of the leadership characteristics you now have and very prescriptive of what you should aspire to be. It first gives you a comprehensive understanding of where you are and then, based on the feedback from your leaders and subordinates, shows you pathways for change. It has made a big difference in me personally and in my leadership team. You can see the difference in our business, in the quality of our products and the productivity of the plant. All our business characteristics have improved greatly.”

Mike reports major gains in every area of HPPG's business over the past two years. Here are just four indicators: “First, our productivity has increased about 8 percent. Our ability to exceed production expectation is measured on operating efficiency (assembly run rate). We were averaging about 88 percent; now we average 96 percent. Second, in the area of safety, the incidence of injury rate has dropped 9 to 6 to 0.5, the lowest in the company. Third, in the area of quality, specifically the customer complaint measure, in terms of what we deliver to the other Honda plants, we are setting company and industry records, going from 90 to 19. Fourth, in the area of employee retention, the retention of our engineering workforce, we have seen the biggest improvement. Two or three years ago, the leadership team was not doing a good job of communicating and developing relationships with our younger engineers. Attrition was close to 17 percent, meaning we were losing 17 percent of our talent annually. Now we are hovering around 6 percent and moving toward our goal of 3 percent. The incredible gains made in retention impact every area.”

Mike confirms: “We could not have achieved such positive results so quickly without the experience. I can tell you that the Honda and FCG leadership approach leads to exponential gains, not just incremental gains.”

Now most of Mike's senior managers have gone through the HLS. “Their experience was very positive, both in terms of what we learned and how we applied what we learned, and the results achieved. If you looked at my leadership team before HLS, working with the internal Honda OD and with the Full Circle Group, getting feedback, and working through modules, you would see that our management approach was much regimented.”

“Now if you asked my team what is most important, you would find that it is serving the people we work with—developing and maintaining relationships of trust with them. Our relationships now are so much deeper. I can sense a positive culture change, especially in the leadership team relationships. They are much deeper. These changes would not have happened without this work. Our division managers now understand that it is not about you being the boss—it is about them, our people, about their growth and development. You can lead more effectively by understanding and serving others. Now our associates see that the leadership team is not about top-down control but about a servant-leadership approach, about caring for them, their learning, growth and development.”

Mike and his leadership team are now accelerating the culture change—from a Reactive to Creative style, from a focus on problems and threats, fear and reactions, to a focus on vision, purpose, passion, and action. He and his team have identified three Reactive characteristics that they want to reduce (Controlling, Protecting, and Complying) and five creative competencies they want to develop (Relating, Self-Awareness, Authenticity, Systems Awareness, and Achieving).

“We are making these changes because we now know that the way we used to respond to problems was less effective. When we were trapped in the vicious cycle of Problem-Reacting (problem/threat to fear to reactions) our typical responses to threats and fears were emotional and occasionally hostile. Emotions ran high, and the end result was much frustration. To create the culture we want to establish, we had to transcend the Reactive styles and practice Outcome Creating: vision/purpose to passion to action. Our focus now is on building relationships, and helping others to realize that we are all one team and we can rely on each other when times are challenging. We have identified three next steps: 1) expand what we learn as individuals and strengthen how we interact with others and do so with increased empathy; 2) increase fulfillment by following the Honda values or the three joys—from product creation through lifetime-owner-loyalty through end of life; and 3) integrate the Honda philosophy more and to strengthen leadership across North America to achieve our ideal image.”

In the beginning, Mike reports:

“The HLS development experience was really about learning more about myself as a leader, receiving the LCP feedback and understanding that if I wanted to see change in our team and company, I needed to change first. I was then motivated to get more of my leadership team through that process so they would see how I was trying to change and why we needed to change as a team. We now have a critical mass of people who have experienced the process so that the positive changes can be sustained. We have deeper discussions on core issues, and we act differently on those issues, not just react to them. We have developed modules for discussion. In our monthly leadership meetings, I take one module topic and turn it into a 30- minute discussion—on being vulnerable or on being extraordinary, for example—because I do not want to lose the momentum we have gained.”

In addition to the business results achieved, Mike was able to retake his LCP 15 months later (see Figure 7.13) and e-mailed us to say, “This stuff really works! I am so happy that I improved from the first time I took the profile. I have made much progress and look forward to the work ahead.”

In this case, we can see Mike doing his personal development work, and then taking on the Leadership Agenda at his plant: “The positive changes in me and in our culture and business performance come as a result of everything that HLS and FCG brought to the table, their holistic (whole systems) approach to change. We see that by applying what we learned to increase our skills and capabilities, we also increase our contributions and fulfillment, with less waste of energy and resources.”

Case 4: Technology Service Provider

A multi-national service provider (we agreed to maintain anonymity at the request of the service provider and their client) encountered a big challenge when its largest client in Asia Pacific experienced a serious problem that affected thousands of its customers. From the client's perspective, the issue was largely the responsibility of the service provider.

The client organization gave notice of its intention to cease the multi-million dollar contract within six months unless five key criteria of service excellence were achieved by the supplier. Of the service provider's 850 employees dedicated to the client, most were in client support roles. An investigation revealed that a large part of the problem was a systemic issue—the quality of the relationships between the client and the service provider.

Meeting the key criteria could only be achieved if there was a culture transformation on the part of the service provider, including a shift in employees' attitudes and improvement in the capability of collective leadership to engage team members in the turnaround.

Soon after, the service provider engaged the services of Full Circle Group Asia Pacific. A custom and integrated transition strategy was designed and delivered for the service provider. The first 12 months included Senior Leadership Team development and one-on-one executive coaching for the top 25 leaders of the service provider.

An integral part of this design was the TLC Leadership Culture Survey (LCS), the Promise of Leadership workshop and the Leadership Circle Profile 360 (LCP). These were used in tandem along with other key culture transformation initiatives, including Vision Journey Mapping, ongoing TLC Pulse Surveys, Leader-to-Leader cohort sessions for senior leadership development, and culture change workshops attended by about 800 employees. The work was designed systemically with the entire system in mind.

The outcome was astonishing, especially to the client. As Figure 7.14 shows, business metrics changed dramatically and very quickly. Service penalties dropped 700-fold in 9 months. The sales pipeline increased five-fold over the same period. Internal Excellence and Customer Satisfaction scores increased as well. The service provider's culture changed so positively that the client postponed the cessation of the contract after only three months from the start of the culture change program. Within six months, the client began to reaffirm old contracts and entered into two new contracts, both worth over $100 million. As evidence of the shift in the client-service provider relationship, the CEOs and board members of both organizations agreed to meet semi-annually to discuss how the two organizations could work more closely together for the medium and longer terms.

What Changed? Here is a summary of what changed in the service provider's organization dynamics:

• The LCS enabled the leadership team to realize that the negative relational and cultural dynamics that the client was experiencing were evident within their own collective leadership team. The leadership team was a fractal of the whole culture.
• The leadership team collaborated to consciously change from within and then to lead the business to a new level of capability.
• With the support of one-on-one executive and senior leadership coaching using the LCP 360, leader-to-leader sessions, and Pulse Surveys, the leadership team aligned to a powerful vision and client-focused strategy. With this shared purpose and clear future direction, the Executive and Leadership Team, along with the top 50 leaders and appointed “change champions,” engaged all individuals and teams in dialogue to agree what it would take to achieve the vision.
• The top 50 leaders (Extended Leadership Team) and change champions were invited to culture change work sessions to become aware of their operating behaviors and values. Soon, most chosen behaviors had aligned with the vision and resulted in quality engagement with peers, direct reports, and clients.
• Leaders who struggled to adjust or resisted engaging with the culture change initiative were shifted to another part of the service provider's business. Some chose to leave the organization.
• Internal culture change champions held forums about how to accelerate the change.
• The leadership and culture transformation started to show results within three months. Within six months, the CEO and board members of the client organization publically recognized the turnaround in both results and relationships. Since then, relations have gone from strength to strength, and the client continues to ask for a closer relationship with the service provider at the highest levels. This was unimaginable before and shortly after the major problem that became the catalyst for the leadership and culture change initiative.