An owner of five banks recently told me, “I have a billion dollar business with a million dollar staff”. After working with his 20-person team for 30 days it became crystal clear that his style of command and control leadership not only demotivated his staff, it also clouded clear communication.
The Old Way
The bank owner employed tactics we call the “terrible three” technique of leading:
- Control others
- Command orders
- Create fear based culture
Using this technique produces:
- Lower profits
- Poor motivation among employees
- Increased turnover
Leadership, for too long, has been based off of an outdated model. Made popular during World War II and the Industrial Revolution, this “factory mindset” is built on the “terrible three”. It focuses on leaders dictating orders and controlling employees through fear. Amazingly, in my research, over 91% of leaders still use this ineffective model.
Why do leaders do this? Because it feels good and gets immediate action. Unfortunately, this often comes at the expense of long-term success and motivated employees.
So, what’s the way forward?
The most successful companies and effective leaders have migrated away from the old leadership model. They utilize what I call the “21st Century Leadership Model”.
When I was in Management Training with E. & J. Gallo, I was taught the Three “C’s” of leadership:
- Care, genuinely care, for others
- Challenge people
- Cast vision and hope
Unfortunately, this technique was not modeled in the field. How could that be? I have concluded over time that people dumped what they were taught for what was “caught”. A majority of the managers used the “terrible three” technique rather than the 3 “C’s” they were taught. They decided to employ short-term, easier tactics instead of investing time to use profitable, longer-term techniques.
After a three-month period of near fatal failure in my first territory of grocery accounts with E. & J. Gallo, I threw caution to the wind and decided to try the three “C’s” taught in Management Training. In two months, I became the number one territory manager in the company and was then promoted to the highest volume territory in Southern California.
21st Century Leadership
There is a saying that people don’t care how much you know until they know how much you care. Our billionaire bank owner described in the opening scenario decided to try the three “C’s” instead of continuing to lead the “old way”.
He implemented a policy with his supervisors where they ask their staff a powerful question first, rather than telling them what to do. Team members’ buy-in much more emotionally to an idea when they come up with it themselves instead of being told.
“Seek first to understand before being understood” – Steven Covey
Within 14 days, the banks’ team members went from stoic and introverted to energetic and innovative. New programs and policies were created focused on fostering personal and friendly interactions with clients. These changes resulted in a record number of new loans and banking accounts being opened. Employee turnover was also cut from 12% to 5% over 12 months.
Using the three “C’s” has been shown to produce:
- Higher profit margin
- More motivated employees
- Better employee retention
The future of your company depends not only on you leading the way, but also the way you lead. So, you can rely on the crutch of the “old way” or lean in to the progressive leadership style of 21st Century Leaders. Utilize the three “C’s” and enjoy greater results. Go be a 21st Century Leader…