The Remaking of the Contemporary Leader

A significant, accelerating shift in the necessary knowledge, skills, and abilities (KSAs) for senior leadership that began about 15 years ago is now broadly complete and has resulted in a fundamental change in the necessary leadership profile for success in contemporary organizations. At a high level, the evolution has primarily been from “technical” skills and a top down decision making style related to process to “soft” skills related to leading people and organizations through high change environments and facilitating success in others. The shift is also broadly related to the traits and characteristics that support leaders themselves in complex, ambiguous, and even volatile operating contexts.

What drove the change?

There are many factors that have rendered much of the historical leadership model close to obsolete, but the primary drivers are:

The Pace of External Change

This includes competition, globalization, disruptive influences (automation, outsourcing), macroeconomics, the diminishing shelf life of ideas, technology, and market advantages, etc.

Demographic and Cultural Changes within Organizations

This includes the diversification of the workforce, influence of millenials, evolving beliefs and values, and changing employee needs among other factors.

Technology

Although technology is a component affecting both external and internal change, it is also a factor driving the evolution in leadership profiles in its own right because it has dramatically changed how people work together and communicate, business models, competition, training, data analysis, automation, and a host of other factors that compromise stability in organizations.

How do the old and new models compare?

The reality is that traditional leadership models are not only much less effective, they can actually be detrimental in contemporary organizations because top down decision making, a focus on process rather than people, and the products of cognitive vs. emotional intelligence can actually alienate employees, compromising performance, and in some cases, driving them out of the organization. Obviously, no leader falls 100% in either the old or new paradigm, but the demands of contemporary leadership are far more effectively met by the KSAs of the new model because it is less about the technical skills or task completion of the leader him or herself and more about how she or he facilitates success in others. It also does a much better job of recognizing and supporting the humanity in organizations, which supports human capital development and teamwork. And that is probably the single greatest competitive advantage an organization can have! A partial list of many of the discreet differences is below.

Old Leadership Model New Leadership Model
Egocentric Vulnerable/altruistic
Success through self Success through others
Expert Coach/partner
Isolated Accessible
Authoritarian Empowering
Talks Listens
Top down Distributed
Guards information Transparent
Directive Collaborative
Empirical Analytical
Objective Intuitive/Self-aware
Process expert People expert
Transactional Transformational
Risk averse Risk tolerant
Data driven Data generating
Technical skills Soft skills
Finance skills Financial literacy
Cognitive intelligence Emotional intelligence
Internal influence Internal and External influence
Process manager Change manager
Controls complexity Manages complexity
Results oriented Sustainability oriented
Planner Strategist
Avoids conflict Supports healthy conflict
Fears ambiguity Tolerant of ambiguity
Manager Teacher

In some cases, leaders benefit by leveraging elements of both the old and new paradigms. For example, if someone is fortunate enough to possess both high IQ and high EQ, that is certainly advantageous. Likewise, being results oriented and focused on sustainability is clearly value added. Leaders and leadership styles are not binary. However, the environments in which leaders have to perform today are so dramatically different than even 15 years ago, that they, and their organizations, are much better served by those who are broadly skewed to the new paradigm.

Unfortunately, while the literature in the field is slowly recognizing the profound changes required for successful, contemporary leadership, leadership training is, broadly speaking, still significantly behind the curve. Most leaders who benefit from the knowledge, skills, and abilities found in the new model are naturally disposed to the construct or have evolved over time through their own professional development efforts. They are also generally quite unique and reflect the leading edge of leadership practice. It is because most leaders do not, in fact, fit the new model, that so many are struggling today, turnover is high, and organizations find themselves ill prepared for contemporary challenges.

Surprisingly, one continuing barrier to the adoption of more progressive leadership behaviors across organizations is the culture that is still present in many environments. Culture is powerful and while a board of directors or an executive team might use the right language when discussing leadership needs, a minority of organizations and contexts are truly ready to support senior and executive level leaders who embrace vulnerability and are genuinely transparent or empowering or focused on sustainability over short term results. That will change over time, but for now, a core additional challenge for progressive leaders is overcoming the “old” thinking in their own organizations, boards, and industries!

A New Model for Higher Education Leadership—And Why Boards Have to Get Serious about Pursuing the Leaders They Need

As institutions of higher education (IHEs) downsize, merge, and close at an increasing rate, it is becoming clear that many executive level leaders are ill prepared to meet the challenges faced by colleges and universities today. This also partially explains both the sharply decreasing tenure of college presidents and the increasing failure rate of executive searches, i.e., institutions having to re-initiate searches not long after selecting a candidate.

So, what skills, abilities, knowledge and characteristics would better serve leaders in higher education today?

Earlier this year, the Chronicle of Higher Education hosted a conference about the criticality of an entrepreneurial mindset for effective leadership in contemporary higher education. On one of the panels, Dr. James Koch, professor emeritus at Old Dominion U., noted that,

“As I look at colleges and universities today, the leadership tends to not be composed of risk-takers. I think that is a function of the way deans, provosts, and presidents are selected. Any individual out there in the age of Google, who has offended any major constituency, or thought about things in a different way, or has written about things in a different way, is likely not to get selected. They’re out. Well, that eliminates a healthy portion of individuals who think entrepreneurial thoughts. I’ve evaluated perhaps 50 presidents, and that runs as a common string through the institutions that are failing.”

Can I get an, “amen?” As I’ve noted in previous posts, higher education as an industry and a culture, is usually structurally incapable of incubating the kinds of leaders that colleges and universities need. Moreover, traditional academic search firms are more likely to be rewarded by their clients for presenting candidates that preserve institutional biases than those who challenge the status quo. Outlier, game-changing candidates produce dissonance and boards don’t like dissonance!

So, what are some of the highest priority requirements for executive leaders in higher education today? The partial list below is a good place to start.

  • Strategic
  • Entrepreneurial
  • Innovative
  • Emotionally and culturally intelligent (and willing to embrace vulnerability)
  • Effective manager of: conflict, crisis and change
  • Has tolerance for: risk, ambiguity, complexity, and volatility
  • Possesses business and financial acumen, particularly relative to higher education
  • Understands organizational dynamics
  • Drives human capital development and teamwork
  • Respects the humanity within organizations
  • Understands and can influence the external environment
  • Can listen and learn

Note that the profile does not include items such as “expertise in shared governance” or “strong publishing record” or “content expert in engineering.” It is not that those items wouldn’t be nice-to-haves in a college president, COO, or provost. It is simply that the ways that higher education executives must bring value in today’s volatile, high-change, and highly competitive environment, are game-changing, strategic outcomes. Technical expertise and contributions to accreditation or curriculum or research are much better left to others in the organization whose efficacy and success are facilitated by executive leadership.

Ironically, it’s not that higher education boards don’t know what they need. Through my consulting work with boards, recruitment firms, and executive candidates, it is clear that IHEs have gotten much better at describing the leadership profile they need. Randomly select a dozen job postings for president or provost from the Chronicle of Higher Education and you will find words such as “innovative,” “visionary,” “dynamic,” “change manager,” “entrepreneurial,” “strategic,” etc. to describe the kinds of leaders that the institutions say they want. These postings will also typically say they want leaders with great people leadership and communication skills, financial acumen, and rarely even emotional and cultural intelligence.

The problem is that most colleges and universities are not very good at actually recruiting and hiring candidates with the leadership profiles they’ve created.

Why is this?

The challenge is partly because most universities and their boards are simply not culturally ready to hire a new kind of leader, and secondly, those same colleges and universities are generally poor environments in which to grow the leadership skills necessary for today’s challenges. As such, the internal pipelines in most IHEs are not producing many “new paradigm” candidates. Although there are increasing exceptions, the majority of executive level hiring decisions are still “safe,” status-quo affairs that don’t reflect the language of the job description nor the actual leadership needs of the institution.

One common and dysfunctional dynamic that compromises effective executive recruitment is that search committees and boards are often beholden to unwritten institutional requirements for executive candidates that force them away from the experience and skill sets that the institution actually needs. An example might be that despite what the job description says, the board won’t hire a provost without a high profile publishing record or won’t hire a president who has not raised a given sum of money. Another common and detrimental prejudice is against candidates with extensive private sector and “for profit” experience, who are most likely to have the experience and skills higher education says they need! There is also frequently significant bias in colleges and universities based on core programs. For example, a school of psychology might only hire a chief executive who is a psychologist or an engineering school might only hire a president who has a STEM background. The problem with that is not that psychologists and scientists can’t be good executives. The problem is that generally speaking, if an institution of higher education derives value from an executive based on her or his technical skills, then they are getting very limited value and it’s coming from the wrong place. What happens more often than not is the institution sacrifices the leadership profile they really need in favor of cultural, political, and historical biases that are vestiges of a previous, often anachronistic paradigm. As Peter Drucker famously noted decades ago, “Culture eats strategy for breakfast.” It also overwhelms executive searches and hiring decisions in higher education, which wouldn’t matter if the stakes weren’t so critically high.

Of course there was a time when higher education was a much more static, financially stable, and slow-change milieu in which the demands on leadership were also much less far-reaching—and the implications for getting a search right were far less significant as well. A couple of years ago, the Aspen Institute issued a report on the university president of the 21st century that identified 27 competencies of contemporary university chief executives. No one can claim 27 competencies, but the key take away is that the leadership profile of today’s higher education executive is dramatically, fundamentally different than it was even a generation ago. The reality is that there are candidates who are strategic, entrepreneurial, emotionally intelligent leaders, who build culture, empower people and effectively manage change. In fact, there are such leaders in higher education today, some of whom also have academic pedigrees, but they are “unicorns.” To make the recruitment challenge even more difficult, the ideal candidate also has traditional skills as well. As Dr. Koch noted, “there are times when you need to… create operational excellence and perform on traditional metrics, and then there are times where we have to open up new markets, new business models, new ways of delivering value to our customers.”

As such, if boards (and search firms) truly want to hire the executives their institutions need, they have to acknowledge and overcome the bias in the process and they have to be willing to look outside the pool of career academics, content experts, etc., and certainly have to look outside of their own tribe (community college, private/independent, four year public, not for profit, etc.). Continuing with safe, dogmatic, culturally amenable hiring choices not only fails the search process, it ultimately fails the institution—and in many cases the right choice is an existential imperative.

While it is helpful for leaders to have at least a basic understanding of academic institutions and culture, in the current environment, most institutions would benefit from sacrificing “insider knowledge” in return for the knowledge, skills, and abilities extent in dynamic, strategic leaders who can move entire institutions. In short, institutions of higher education should recruit executives who will be “force multipliers” by leveraging the expertise and passion of the collective human capital of the organization, rather than through their own technical skills or task completion. The reality is that the pool of such leaders within higher education is far smaller than the number of institutions that need such leaders. However, if boards actually search for the leadership profile they say they need and are willing to evaluate candidates whose CVs were built largely outside of traditional higher education or narrow content disciplines, they stand a much better chance of getting the leaders they actually need.

A little courage wouldn’t hurt either…

Footnote:

I have worked with multiple recruiting firms, particularly those representing traditional higher education institutions, that, as a matter of protocol, actually filter out applicants who submit more than the minimum requested application materials. In other words, if the application only requires a CV, cover letter, and references, a candidate who tries to submit a leadership profile or innovation model, etc., is often told that the search firm cannot accept those materials because it “wouldn’t be fair” or wouldn’t be a “level playing field” for other candidates who don’t go beyond the minimum (that is not the way private sector searches happen, by the way.) Relatedly, search firms often assign junior colleagues with no actual higher education experience to filter applications, often misinterpreting CVs and missing transferable experience. As a result, in many cases, university search committees and boards are denied information that would be critical to the due diligence process and that, by definition, are more likely to come from more innovative, motivated, and less traditional candidates.  I mention this because in a surprising number of searches, recruitment firms themselves contribute to the problem of perpetuating existing institutional bias in the search process, and to the ultimate outcome of hiring less qualified candidates that don’t actually fit the desired profile. I highly recommend that boards who are using search firms insist that those firms not only accept, but encourage that applicants provide information that supports identification of candidates who are more likely to meet the actual performance needs of the position. After all, once the hiring decision is made, the executive will not be afforded anything approximating a “level playing field.”

The Hidden Story Behind the College Admissions Bribery Scandal

Among the private universities implicated in the recent admissions bribery scandal, roughly one fifth of total enrollments at Wake Forrest, Georgetown, Yale, and Stanford are children from the “top 1%” of income earners in the country, while only half as many of their enrollments come from the bottom 40% of income earners! At another 38 elite colleges, including four more in the Ivy League — Dartmouth, Princeton, Penn, and Brown — more students come from the top 1 percent of the income scale than from the entire bottom 60 percent. The hidden story is that regardless of how wealthy students gain admissions, exclusive higher education is one of the most elite propositions in American society. Bribery scandals aside, elite universities are the institutional epicenter of the structural preservation of privilege and wealth in the U.S.

Significantly, these four institutions also have combined tax-free endowments of $55 billion dollars! What this means is that despite access to astounding resources, these institutions still enroll far more “super wealthy” students than financially challenged ones.

And those uber wealthy admits are wedged into a group that is statistically extremely exclusive to begin with. Stanford, for example, admits less than 5% of freshman applicants on a yearly basis, while Yale admits approximately 7%. That exclusivity also happens to be one of the heaviest weighted variables in college rankings. In other words, the most exclusive, highest ranked institutions, are ranked so highly because of how many students they don’t serve!

While the idea of wealthy and powerful parents bribing their children into elite universities is a viscerally disturbing notion, the bigger, hidden reality is the system that ushers the nation’s most privileged applicants through the front door. Keep in mind that in these universities, the “legitimate” application process enrolls twice as many students from just the top 1% of the U.S. population as come from the bottom 40%! The numbers overall are small relative to the entire higher education population, but they are significant relative to who gets into the country’s most elite colleges.

Of course, this reality existed before the bribery scandal and it will continue after the scandal fades, but as Anthony Carnevale of the Georgetown Center on Education and the Workforce notes, the current admissions process is not a meritocracy, it’s an aristocracy, which seems to be one more example of what many see as a “rigged” system. And the problem is not limited to the Ivy League. As he notes in a recent report, “Today’s [public] higher education system is divided into two unequal tracks stratified by race and funding. White students are overrepresented at selective public colleges that are well-funded with high graduation rates, while Blacks and Latinos are funneled into overcrowded and underfunded open-access public colleges with low graduation rates.”

Although bribery gets the headlines, the status quo, every day admissions process may be the real story.

Why It’s Time to Revaluate “Profit” Status in Higher Education

Over the last 10 to 15 years, or so, almost any discussion about higher education policy has required that at some point, the legal profit status of the institution or institutions in question be revealed, followed by instinctive judgements about the institutions based on that tax status. Related to motives or mission or integrity, a non profit status is generally construed to be “good,” while a for profit status is generally construed to be “bad.” That basic assumption is questionable on its face, but setting that aside, any judgments based on tax status are becoming more and more tenuous.

There was a time long, long ago, when institutions of higher education fell into two simple camps relative to tax status: For profit and not for profit—and that distinction generally meant something. The non profits typically did all of the work associated with running a university themselves, their only business was higher education, and they rarely had significant “profits” at the end of a fiscal year. For profits were generally family owned and operated, with strong local relationships, and a market driven need for quality outcomes and compliance. The primary difference was not related to profit per se, but rather to which one paid taxes and how ownership was structured.

The reality of how a growing number of higher education institutions currently operate financially has changed so dramatically, that including profit status as a means of evaluating, validating, or regulating those institutions is probably no longer defensible. To start with, the largest and most “profitable” institutions in higher education today operate with a not for profit tax status. Non-taxable, elite university endowments alone are worth hundreds of billions of dollars. Non-taxable college and university real estate and other assets may be worth half a trillion dollars. And that’s just the balance sheet.

Operationally, the lines have been blurred for at least a couple of decades with hundreds of IHEs now in partnerships with for profit companies and a growing number of institutions actually functioning as venture capital investors in for profit businesses.

Many “not for profit” institutions of higher education have built high margin, tax-free revenue businesses, the proceeds of which are used for everything from incentive compensation to private equity investments to subsidies for unprofitable parts of their operations. Of course, all organizations, regardless of profit status, must generate more revenue than expense over time, i.e., must be profitable, and those who are more successful financially are able to confer more benefit to their stakeholders, which is a positive outcome for both non profit and for profit enterprises. The current conundrum around profit status is not even related to profitability. It is related to what organizations do with profits and how they are regulated relative to their legal corporate structure.

Ironically, IHEs with an actual, legal for profit tax status have never been less profitable and have been closing en masse. Those that do make profits, continue to pay federal and state income taxes on those profits (as well as local sales and often property taxes), while enduring additional regulatory burdens related solely to their tax status.

In what is probably the greatest irony of the for profit vs. not for profit debate, the most financially successful “not for profit” institutions today are making money using the same methods that “for profits” introduced into higher education decades ago—corporate partnerships, executive incentives, mass market programs, high-margin online programs, retail marketing, international and military students, spin-off businesses, equity investments, etc.—all while reducing costs with a for-profit-like expense model of contingent employees and outsourcing. Relatedly, the non profit fallacy is at the center of a growing divide between haves and have-nots within traditional higher education itself. While some non profit institutions have never been more profitable, with greater liquid assets, many others are facing existential financial stress–and hundreds will close over the next several years.

So, what does profit status really mean at this point? On the one hand, colleges and universities with a not for profit status have a significant financial competitive advantage over tax-paying, for profit institutions. They also have a reputational advantage, but without most of the restrictions, both regulatory and financial, that apply to those with a for profit tax status. If Arizona State or Southern New Hampshire or Purdue, for example, can take their profits and turn them into venture capital or establish revenue sharing agreements with for profit partners (or even acquire for profit partners, then shed the tax burden), is there a meaningful difference between them and IHEs that operate with a for profit tax status? Does it matter? Under what conditions would an institution with a legal not for profit corporate structure be perceived to have abused that status related to tax or regulatory obligations?

There is nothing wrong and a lot right with universities being entrepreneurial and with developing multiple revenue streams—in fact, it is necessary in today’s operating environment. On the other hand, not for profit tax status was never intended to be a competitive advantage in business. Moreover, it is a fair question to ask whether or not a non profit university should have access to taxpayer funded Title IV financial aid, legislative appropriations, and other government support while having zero tax obligations on their endowments, property, and other profits.

One might argue that institutions with a not for profit corporate structure are more likely to be student-focused or operate with higher integrity than those with a for profit status. However, if that non profit moniker has simply become a tax shield, while everything else about the operations says “for profit,” then maybe the tax status is meaningless for judging institutional mission and integrity as well. Moreover, if a public university invests in a for profit start up or acquires a business and it fails, whose money did they lose? If it succeeds, to whom do the profits belong? Private, not for profit institutions are a little more complicated, because they tend to receive much less taxpayer subsidy, but the richest universities by far also happen to be “non profit” privates.

The rationale for non-profit status to begin with is based partly on the notion that an organization on which such a valuable benefit is conferred, has some obligation toward the public good. It’s not that “non profits” can’t or shouldn’t be profitable. The idea is that if an organization is shielded from tax burdens and other regulatory obligations, that we should all be better off through a trade-off of sorts–the organization is afforded significant advantage, and in return, they make decisions that benefit society. That has been broadly true over most of the history of “traditional,” not for profit higher education, but if an institution with a tax free multi-billion dollar endowment is collecting taxpayer funded financial aid, then graduating students with unmanageable debt, while converting cash to venture capital, is that in the public good?

It would seem at this point that a better yardstick for validating the legitimacy of colleges and universities (and their taxpayer funding) would be achievement of agreed upon outcomes, rather than tax status. Those outcomes could be student diversity, student debt, retention, graduation and employment rates, socio-economic mobility after graduation or any number of potentially important objectives. That would also probably matter a lot more to students as well. Thinking way outside the box, imagine if an institution’s tax burden were based on achievement of those performance indicators rather than its status with the IRS!

The Growing Crisis of Confidence in U.S. Higher Education

I have written previously, here and here, about the ongoing contraction in higher education and the growing risk to what amounts to a majority of all private colleges in the U.S. While demographics explain the lion’s share of the decrease in enrollments (and thus revenue) over the last seven years, there is another, equally problematic phenomenon that higher education ignores at its own peril: the decreasing confidence that Americans in general have in the value of higher education. Recent surveys by Gallup found that this “crisis in confidence” is worsening, with less than half of American adults now having “a great deal” or “a lot of” confidence in higher education. While private institutions face a more grave existential crisis than do public institutions due to the differing financial models and political support, the crisis in confidence extends to all of higher education. In fact, many Americans no longer see college as the path to a better life, and in many cases, see it as an actual barrier to a better life due to crippling debt.

Attending college or university has always represented a major investment of time and money, but over the last 25 years, the decrease in public funding and the increase in tuition, has created a situation in which Americans are now, for the first time, broadly questioning the value proposition of a college degree. In just the last ten years, the cost of attending a four-year college in the U.S. has increased by nearly 30%. Until recently, students and their families were willing to borrow money to pay the increasing costs—to the tune of approximately $1.5 trillion dollars in outstanding student loan debt. However, it appears that the appetite for borrowing has waned as the value proposition of tens of thousands of dollars in debt (the U.S. average is about $30,000 per student, with about one in five borrowers owing over $100,000) becomes much less compelling. As a result, the average “discount rate” for tuition in private colleges now hovers around 50% with many institutions exceeding 60%. What this means is that in order to get students to enroll (and a decreasing number at that) institutions are actually charging only half of the published tuition rate. This is one of the primary reasons that not for profit private colleges are closing at a rate of about one every two weeks. The financial model is simply unsustainable.

If we evaluate the value of a college degree across the entire population, graduates are generally still better off with a four year degree than without one, on average, earning up to $1 million dollars more over a lifetime than those with only a high school diploma. However, even with that increased earning power, the average graduate who does pay off his or her loans, takes over two decades to do so and defers everything from marriage to home ownership in the interim. The reality is that half of all borrowers today are making interest-only payments, and thus see zero progress toward paying their loans off. Moreover, research conducted by the University of South Carolina found that the student debt itself correlated with increased stress and related health problems, which contributes to the growing negative connotations associated with higher education.

The current oversupply of higher education in the face of continuing declines in enrollment is exacerbated by historically low unemployment and deep concerns about the value proposition of a university education in the first place. There is no question that the contraction will continue and that public institutions will downsize and merge and private (both for profit and not for profit) institutions will close. The question is how deep and sustained will the contraction be?

So, what should institutions of higher education (IHEs) do?

One bit of good news that recent Gallup research of graduates shows, is that there is an inverse relationship between the size of their student debt and the degree to which they believe their education was “worth it” (the higher the debt, the lower the satisfaction and vice versa). Why is that good news? Because the simplest and most effective thing colleges and universities can do to improve the perceived value proposition is to graduate students with lower debt. Relatedly, the research also determined that the issue is not just about money. It’s the value. Even high debt graduates are still likely to believe the cost (and debt) was worth it if they believe they had a high quality educational experience, which led to good employment. For the half or more of all students who don’t graduate at all, the outcome is usually quite grim, but that is another issue…

There are two critical lessons here for institutions of higher education. One is that student debt overall must come down if colleges and universities hope to overcome the increasingly negative views of higher education, and two, whatever debt students do incur must be “worth it” relative to the quality of their educational experience and the quality of their employment prospects upon graduation. The “between the lines” message here is that there is a very limited number of students overall for whom high cost on the front end with poor employment and income opportunities on the back end is viable. In other words, the notion of $30,000 or $50,000 to $100,000 or more in debt for a degree that leads to low pay or no gainful employment (social work, teaching, art history, photography, etc.) is very close to the end of its viability in higher education. To be clear, the career fields are not the problem per se. The problem is high cost degrees for low wage employment—the ROI simply doesn’t work for students in these cases.

Obviously, many colleges and universities will survive because, in addition to addressing student debt, they will make a host of decisions about innovation, partnerships, alternative revenue streams, value proposition, expense models, etc. However, with the exception of a minority of institutions (think elite flagship state universities and highly selective private colleges) the survivors and thrivers in the remaining 80% or so of IHEs, will make it because they change the way they operate. Even then, supply will shrink, but the institutions that survive will be much more innovative, customer-centric, and financially viable–and students will have the confidence in the return on investment to enroll.

The Innovation Crisis in Higher Education

One can use a lot of words to describe the typical higher education culture, but “entrepreneurial” is usually not one of them. To the contrary, although there are a few exceptions, higher education cultures are more likely to be defined by a powerful inertia in favor of the status quo. That reality is not just unfavorable for innovation, it is actually at the core of the existential crisis facing much of higher education today.

The process that does exist to facilitate change in traditional colleges and universities generally favors extensive deliberation over timely action and distributed authority for decision-making. It also is driven by institutional needs rather than market needs. That process works really well when the external pace of change and/or need for change is equally slow and incremental. The central problem for higher education today is that the external pace of change is disorientingly fast, exacerbated by the fact that the market need is for transformational change. The current rate of college and university closures is painful evidence of the mismatch between traditional higher education culture on one hand and external and market demands on the other hand.

Although the world of higher education is fundamentally different in some ways than much of the “private sector,” with requirements for accreditation, governance, and complex financial models being prime examples, much of what mitigates against innovation, even though deeply structural, is nonetheless by choice. In other words, it doesn’t have to be the way it is.

The number one facilitator of nimble, speed to market activity in organizations is culture. Organizations that function with continuity, lack of politics, appetite for risk, and teamwork will be more entrepreneurial, more agile, and more successful over time because those things reflect the value of human capital and cannot be commoditized. As Gary Vaynerchuk of VaynerMedia notes, technology and skills and products offer a painfully short competitive shelf life, but the emotional ability to interact with others and work collaboratively toward shared goals cannot be coopted or copied by any competitor and it is renewable. Although it’s harder to create, once you have it, human capital empowered by culture is the number one determinant of success, in the tech world, and anywhere else. In the higher education ecosystem it may be an even more powerful asset and competitive advantage because it is so rare.

So, how can institutions of higher education operationalize innovation? A place to start would be a model that recognizes the massive human capital that already exists in institutions as the source of innovation rather than the keepers of tradition and status quo. This is as much or more a cultural shift than an operational one, but it can start small, with individuals, and grow to eventually be institutional in nature. No one would describe most college environments as having appetite for risk, operational continuity, or even much sustainable collaboration, let alone as “apolitical.” In fact, as the scarcity model pervades higher education, institutions are often becoming less collaborative. Having said that, even with the cultural challenges inherent in much of higher education, there is a surplus of ideas and energy, and a powerful, if unrecognized and untapped army of potential entrepreneurs waiting to be empowered. Some simple steps include:

  • Ensuring that, at the enterprise level, the institution has identified a list of high risk-high reward initiatives/strategies and implements at least one or two each year.
  • Doing a similar exercise at the school/division/department level and creating an “experimental” channel for new initiatives that is outside the normal evaluation/approval process.
  • Add an item for entrepreneurialism or innovation in every individual’s performance evaluation.
  • Create interdisciplinary teams to work on high priority challenges and give the teams the authority to choose the desired solution.
  • Incentivize innovative problem solving with shared rewards generated by successful solutions.
  • Create innovation or entrepreneur grants that do not require a quantified return on investment.
  • Volunteer with regulators/accreditors for every advertised pilot project and take a leadership role in suggesting others.
  • Invite industry and/or the community to be a ground level partner in all material initiatives.
  • Identify the most entrenched, inviolable, “sacred” constructs in the institutional culture and history. Put that list next to the greatest challenges faced by the institution. Which sacred cows exacerbate which challenges or present a barrier to success? Determine which of those the institution will abandon in favor of solving a critical problem.

The strategies above reflect a very small list of potential initiatives, but when implemented, they support entrepreneurialism, result in innovative outcomes, and support a culture that becomes self-sustaining. Obviously, institutions that are led by people who believe in the value of human capital, risk-taking, collaboration, teams, and empowerment are going to be better positioned to address the “crisis of innovation” that is compromising much of higher education than institutions whose leadership and core culture value tradition and status quo over innovation. But even in those institutions, support for incremental experimentation can lead to innovation and culture change. Higher Education is already experiencing the greatest contraction since WWII and the institutions that survive and thrive in the current environment will simply be those that adapt through innovation and an openness to the “new” in every way.

It’s Time to Think Differently About Competition

As managers and leaders we’ve been taught that our competitors are our “enemies.” While there may be good reason to protect a bon-a-fide competitive advantage at a given point in time, the historical notion that our competitors are enemies to be avoided and worse, even hated, also has significant costs. It’s probably time to re-evaluate the old thinking. Even more problematic, we have even been socialized to see others in our own organizations as competitors—vying for limited resources, promotions, incentives, etc. While friendly competition can certainly be a motivator in some cases, that is only viable over time in organizations if the competition does not have zero sum winners and losers. Some of the least healthy and most dysfunctional organizations I’ve ever seen are those whose cultures are based on winner take all competition. Those cultures are deadly for collaboration, collegiality, and teamwork.

When markets were more stable and even static over time; when operating environments had less regulatory risk; and certainly when demand outstripped supply (as was the case for decades in higher education), circling the wagons and operating as if every asset, idea, technology or product/service was “proprietary” might have made more sense. In the world we operate in today, however, which is not only volatile, uncertain, complex, and ambiguous (VUCA), but in which most organizations are forced to operate with limited capital and increasing overhead (caused by regulatory requirements, constantly changing technology, perpetual upgrades to products and services, increasingly expensive marketing, etc.), while also experiencing downward pressure on pricing, there are compelling reasons to see one’s former enemies as potential partners. Within organizations, the current environment requires a kind of collaboration that actually supports self-sacrifice and shared victories. Outside of or between organizations, the current environment supports formally unheard of partnership between competing entities.

To be clear, leaders must be thoughtful and purposeful when engaging “rivals” in partnership, but the reality is that across industries, most players experience the same kinds of challenges and risks, and thus similar potential benefits from effectively meeting those challenges and/or mitigating risks.

What are some examples where working with competitors makes sense?

In highly regulated industries, working together to improve overall compliance protects everyone while also improving industry-wide reputation. While there might be some temporary value in seeing a competitor crash and burn with a compliance problem, the collateral damage to the industry at large can be devastating. Two recent examples are higher education (for profit and not for profit) and cyber security breaches across multiple industries.

Another example, ironically, can be found in hyper-competitive contexts. For instance, many retailers now partner with Amazon, which previously was considered a bitter enemy. Such partnerships have allowed companies that are experts in a given retail sector to partner with the world’s expert in eCommerce and logistics to dramatically expand their customer markets. Similarly, airlines, which have historically also been bitter rivals, have partnered aggressively to sell seats on each others airplanes, so that they can offer more choices and bigger networks to their own customers. Of course these partnerships come with compromises, but they also solve what otherwise might be intractable problems and/or open what would otherwise be limited or closed markets.

One “industry” that is currently in serious decline in terms of customers (enrollments) and revenue is higher education. It is also an industry that has historically been profoundly insulated and generally closed to partnership with competitors. Not surprisingly, the vast majority of institutions of higher education share common problems that would benefit from shared efforts at resolution. Everything from student debt to retention and graduation rates, to the currently unsustainable financial models, is ripe for collaboration. The traditional higher education model, however, has been for each and every institution to build and maintain an entire, free-standing infrastructure, that must be wholly supported with that institution’s resources. It is not uncommon to see colleges or universities a few miles or even blocks apart that must each sustain separate physical plants, curricula, faculty, staff, and administration, technology, student services, housing, libraries, and every other element of what makes the institution an institution. The model is unsustainable and is one of the reasons that IHEs are shrinking and closing in record numbers. The future viability of the majority of higher education institutions will likely require some level of partnership with “competitors.”

The health care industry is similar, in which competing hospital systems each build and sustain separate, very expensive, free-standing clinical infrastructures. So far, the answer has not been to partner with competitors in ways that make sense, but to “vertically integrate” their own health care systems so that they wring every penny out of every billable event and keep those revenues within their own system via internal referrals. It is highly unlikely that the current health care model will continue unchanged either. In fact, as with higher education, partnering with “competitors” will likely actually become a competitive advantage as institutions work together in ways that improve customer/patient/student outcomes at lower cost and risk to the providers. Just imagine if one institution could offer desirable, shared facilities to students or patients at a fraction of the cost of building and maintaining those facilities separately? Or if two different universities could both improve student retention with shared mental health counseling resources at significantly less cost to both? It’s not unreasonable to even think of combining core assets and functions such as curriculum and instruction or financial aid in IHEs or imaging labs and urgent care among health care competitors.

As unlikely as it sounds to partner directly with what have traditionally been considered competitors, it may actually be a key strategy for surviving and thriving in a VUCA world.

Are Traditional Definitions of Success Hurting Us?

Those of us who have been in management positions since “pre-millennial” times have been led to believe that our “success” is defined relative to the performance objectives of the organizations in which we work rather than achievement of goals and outcomes that matter to us personally. Institutional objectives can vary widely, but a common theme is that our longevity, financial rewards, promotions, etc. tend to be dependent on our ability to achieve what the organizations we work for want us to achieve with our labor, rather than what we want for ourselves.

Over time that reality can create deep, even debilitating dissonance in us as human beings, particularly when we cannot see any connection between our work and some larger purpose. In fact, research on employee satisfaction and retention has found that having a connection to a greater purpose is often ranked higher than compensation. And interestingly, that connection can be as simple as understanding how one’s work contributes to the organization’s final “product” or as ambitious as providing opportunities to support important community or societal outcomes outside the workplace through volunteerism or other community service.

So, is there another way to think about success that better serves ourselves and the organizations in which we work? I am confident that the answer is yes, but it requires us to move beyond traditional paradigms. First, we have to be willing to take a more comprehensive view of what outcomes are “valuable” within an organization so that we can then expand the definition of success in terms of achieving those outcomes. Second, as leaders, it is essential that we provide opportunities for our employees to see tangible connections between their efforts and things that matter to them in ways beyond stated institutional performance goals—and we, as leaders, need the same connections as well. Another, more productive way to look at success, is related to how our work and experience facilitates growth and improvement in us personally. Traditionally, our professional success would be measured by achievement of specific performance targets, working long hours, promotions, etc., rather than the extent to which we develop new skills, mentor other employees, volunteer in the community, etc.

There are enlightened leaders and organizations who have already figured out that finding ways to make work more meaningful also results in more engaged, productive employees, which, of course, benefits the business side of the workplace as well. Success, then, becomes about the extent to which one effectively contributes to necessary organizational performance objectives and also contributes to outcomes that nurture our sense of “making a difference,” self-actualization, and the positive impact we have on others. In that context, the ultimate definition of success is when our efforts actually make the world a better place! For old-school skeptics, not only is that not “pie in the sky” thinking, in the current environment, it may actually be a core differentiator between organizations that thrive and those that don’t.

As a leader, you can redefine what success looks like, support the well being of your employees, and improve organizational performance outcomes by simply broadening the number of areas in which achievement is validated while also supporting activities that allow employees to feel connected to outcomes that matter to them and “make a difference.” If you believe that every business is a people business, then you can’t afford not to.

The Most Powerful Life And Leadership Hack Available Is Free And Easy. Really.

Want to improve your leadership effectiveness, make the world a better place, and make yourself and others feel better in the process? It’s actually possible and it’s surprisingly simple. There’s no magic (but a little neurochemistry) involved.

The very short answer has almost nothing to do with what you’ve probably been told about leadership, but everything to do with being a “better” person. And the beauty of this life and leadership hack is that it is free and probably easier than anything else you’ll attempt on any given day. Although it is generally more effective if it is authentic and comes from a place of altruism, that is actually not necessary. It is possible to “fake it ’til you make it” and still get significant benefit in the interim. So, what is this mysterious and powerful strategy? Just be a kind and thankful person. Really. And the identified behaviors themselves are incredibly simple. They include things like: Smiling, saying hello, listening actively, offering a gentle, platonic touch, saying thank you (and explaining why you’re thankful), telling people that you appreciate them and their efforts, and being generous among others. And, no, this is not just squishy, “let’s all be nice” stuff. It is supported by a compelling body of neuroscience and business research. Read on for the longer explanation.

Those of you who regularly read my articles on leadership know that I often speak to topics that are not common in traditional discussions, but that turn out to be central to effective leadership, while also helping us to create balance and address the human side of organizations. I have referenced everything from the Dalai Lama to Harvard Business Review published research, as well as my own thirty years of experience, and it is becoming abundantly clear that much of how we used to think about leadership is fading in both relevancy and effectiveness. Why is this?

On one hand, the human components of leadership have always been critical, but they’ve simply been ignored because they didn’t fit into the technical and mechanistic bias of traditional management theory, which is historically based on methodology for efficiently controlling human behavior and resources relative to work tasks. Possibly more importantly of late, however, is that the complexity of typical organizational environments and the depth and breadth of daily pressures faced by the people inside those organizations, can no longer be effectively addressed with traditional management and leadership practices.

In a recent article, I noted compelling research that shows how unlikely it is for a leader to be rated low in terms of “likability,” but rated highly in terms of leadership effectiveness. In fact, you have about a 1 in a thousand chance of that being true! Many characteristics have been ascribed to leadership over the last century of research and training, but “likability” has not been visible among them. It’s not just important for leadership effectiveness to be likable at some minimal level, however. At least as importantly, the behaviors that are associated with likability are also associated with interactions and experiences that support positive emotions and build resilience in us as humans—and this is the key to the focus of this article. Leaders who express positive emotion in the form of kindness and gratitude, for example, actually affect their own neurochemistry and the neurochemistry of those they interact with in powerfully positive ways. Not only that, but even people who witness acts of kindness experience similar benefits. The research shows that acts of kindness and generosity actually increase levels of three key neurotransmitters: serotonin, dopamine, and oxytocin, that provide a sense of well being and human bonding, while decreasing stress and anxiety, and at the same time activating centers of the brain related to pro-social behavior—in other words, the gift keeps on giving.

An extension of this phenomenon is what happens when we, as leaders, make people feel valued and appreciated. Research conducted by the Haas School of Business at UC Berkeley, found that when we recognize employees for achievements, their productivity and performance increases for a period of time by about 23%. But when we make them feel valued and appreciated, their performance increases by 43%!

The opposite dynamic is also powerfully true. Research at Georgetown University on incivility vs. kindness in the workplace found that 66% of workers report decreasing their work effort after an instance of incivility and 12% actually quit outright. There are outlier managers who are uncivil and successful—for a while—but research conducted by the Center for Creative Leadership found that bosses who are jerks eventually self-destruct and fall from their pedestals, usually because in a moment of weakness or need, they are not supported by others. The same research found that the single most important characteristic employees want in a boss is for him or her to be kind and respectful!

As noted, the great thing about this life and leadership hack is that it is free and probably easier than any other strategy for improving your leadership effectiveness and making your self (and others) feel better. And while it might be preferable morally if we pursue kindness, generosity, and gratitude from a place of altruism rather than pragmatism, both motivations will actually achieve similar results.

So, if you want to be a more effective leader, make the world a better place, and make yourself and others feel better in the bargain, just be a nicer person! Really. There is zero downside and almost certainly improved outcomes for both your personal and professional lives.

Ignore “Office Politics” at Your Own Peril

When we hear the word “politics,” particularly in a professional context, most of us instinctively interpret the word negatively. Sometimes, office politics can, in fact, be ugly and counter productive, but power relationships, which constitute the origin of the word in Greek, are endemic to any organization and exist regardless of how we feel about them. The extent to which organizational politics are negative or positive, however, is related more to culture and organizational health than to the nature of politics itself.

The way that power relationships and authority are communicated in most work places is through the tried and true organizational chart, which despite the terrible anachronism that it is, still shows relative power dynamics and authority vertically through reporting relationships. Effective organizations today no longer operate through fixed hierarchies. They distribute labor and tasks and autonomy to empowered employees and teams based on skills, experience, attitude, etc. with the desired outcomes driving the decisions rather than the relative positional authority of people in the organization.

This is all related to politics because whether we use an org chart or some other mechanism, every organization has the visible political structure and the hidden structure. As with culture, the hidden part is often far more powerful and pervasive than what we can see. It is critical to your success to understand the power relationships that actually drive organizational politics rather than the visible, professed relationships. In the healthiest organizations, there is a high degree of alignment between what is advertised and what actually happens. The least healthy organizations have the greatest disparity and generally the most negative and debilitating politics.

We have all probably experienced a situation in which something we thought was “approved” became un-approved, or a promised promotion did not happen/went to someone else, or an agreed upon resource did not materialize. Those examples are politics in action, in which the perceived or understood power relationship was superseded by an underlying power dynamic—the “real” power or authority.

So, how do we navigate organizational politics?

In the most-healthy organizations, it is an easier task because we don’t get blindsided by hidden power relationships because they aren’t hidden to begin with. We still have to be cognizant of politics in healthy organizations, but they are much less likely to be overly manipulative and damaging. In unhealthy organizations, politics can be down right toxic. In either case, it is critical to understand where the real power lies and where the “landmines” are.

This article purposely does not present a plan to effectively deal with politics in unhealthy organizations, because attempting to survive in a debilitating environment is not a wise or viable long-term strategy. Success in such environments, if it happens at all, comes at too high a price and the daily dissonance can be debilitating.

The fact is that some human beings are very willing to use manipulation, deceit, and other dishonest and damaging methods to achieve their own objectives within organizations. At its worst, politics can destroy trust, collaboration, and teamwork, while also compromising organizational outcomes. Because of human nature, no organization will ever be free of at least limited political games, but there are good reasons to consider leaving organizations that are highly political in negative ways. This is simply because the success of individuals is becoming more and more connected to working effectively with others, which doesn’t happen in unhealthy and dysfunctional organizations. Negative politics are also distracting and exhausting, which steals finite resources of time, energy, and motivation, and compromises the success of even good strategies and initiatives. Toxic environments are simply to be avoided.

There are, however, traits and skills that support successfully navigating both benign politics and even mildly negative politics, which are impossible to completely avoid. Even healthy organizations are inhabited by people and we are all susceptible to occasional manipulations and self-serving behavior. Moreover, we simply need to understand and be able to effectively manage both the formal and informal power relationships that we encounter on a daily basis. That is as much a requisite for success as technical skills, communication skills, etc.

So, what are the skills and approaches that support success with organizational politics?

People Skills

Individuals with the most developed emotional and cultural intelligence are also best prepared to recognize and successfully deal with organizational politics. The goal is not to “win,” but to recognize others’ motivations, needs, and behavior.

Intuition

This tends to be more innate than learned, but people with good intuition are generally better at sniffing out the hidden messages and misdirection that often exist as part of political maneuvering.

Networking

One of the best defenses against political games is to build strong networks with honest, dependable colleagues, who can provide objective interpretations of events and behaviors and also provide “protection” from less benignly motivated colleagues.

Assertiveness

The most vulnerable individuals in political situations tend to be the most passive. People with less than honorable intentions will take advantage of passivity—in fact need passivity—in order to achieve bad faith objectives. The antidote to that is assertively pushing back against behaviors in others that are unhealthy and disingenuous. A simple example is stamping out negative gossip or denigration of other colleagues, the organization, etc.

Being Trustful but Not Naïve

A critical element of healthy organizational environments is trust—assuming good intentions until you have good reason to believe otherwise. When we engage other people to begin with from a position of distrust or skepticism, that leads to cynicism, which is damaging in its own right. On the other hand, we are not served by being naïve either. There must be a balance.

Having a Really Good Crap Detector

Ernest Hemmingway once said that having a good crap detector is one of the most important skills one can have in life. This is related to intuition, but includes the ability to assess many elements of a situation at the same time (which comes from experience) and coming to a reasonable conclusion about what is legitimate and what is not. People with good crap detectors are much better positioned to effectively deal with political environments because they can quickly assess what is “baloney” and what is not.

In short, all organizations operate along a spectrum of political activity. No organization exists in a vacuum relative to power relationships, but the healthiest organizations are the least political in terms of negative, dishonest, and manipulative behaviors, while the most unhealthy organizations are generally the most politically toxic. It is important to understand the nature of political behavior and to respond effectively, but it is not advisable to invest the requisite time and energy to survive, let alone successfully navigate, truly toxic organizational environments. In less toxic and more healthy environments, being fully aware of organizational politics and having the skills to address them is an important element of your success.