02/03/2011

By Brian Chernett, Founder, The Academy for Chief Executives

“Level 5 leaders channel their ego needs away from themselves and into the larger goal of building a great company. It’s not that Level 5 leaders have no ego or self-interest. Indeed, they are incredibly ambitious — but their ambition is first and foremost or the institution, and not themselves”. Jim Collins, Good to Great (Random House Business Books 2001)

This was the first counter-intuitive result from the research undertaken by Collins and his team that forms the basis of the book. The research team found that the leaders of companies that make the leap from Good to Great (GTG companies) were not high profile; in fact many of them were unknown outside of their own industry despite running highly successful companies. They had a paradoxical mixture of personal humility and a strong professional will. The term ‘Level 5’ came because such leaders top a hierarchy of leadership types and because the team couldn’t find a suitable epithet to describe their mix of humility and determination.

Many 'big personality' leaders are Level 4. The levels in the book are —

• Level 1 — Highly Capable Inividuals
• Level 2 — Contributing Team Member
• Level 3 — Competent Manager
• Level 4 — Effective Leader
• Level 5 — Level 5 Executive

Collins and the team identified some key attributes for Level 5 —

• Level 5 leaders set up their successors to succeed whereas Level 4 leaders can set up successors to fail and may also stay in post after their effectiveness has waned.

• Most (9 from the 11) Level 5 leaders came from inside the business. None of the 11 had high profile leaders bussed in from outside. Collins remarks on the “irony … that Boards of Directors frequently operate under the false belief that they need to hire a larger-than-life, egocentric leader to make an organisation great..”

• Collins also remarks on the mirror and window differences between Level 4 and Level 5. Level 5 leaders — tend to look out of the window to find the reasons for success and look in the mirror to understand reasons for failure. Level 4 leaders tend to look in mirror for the reasons why they succeed and to blame external events and people for their failures.

- Are you a L5 leader?

- Are you I or we oriented?

- When talking about business achievements which pronoun do you most use? Did I implement the successful policy or did we?

- Do you develop successors to be able to succeed not fail?

- Have you a succession plan in place?

- Do those who will succeed you inherit a business in good running order or a potential wreck?

- Will it please you if the business falters without you at the helm?

Are you fanatical about the results your business achieves?
When the business succeeds do you give praise to 'the team' or take it all yourself? Who do you blame when things don't work out? Team, external factors or you?

When the going gets tough what do you do?

Stay the course and fight for the business? Find a way to get out, preferably with a nice payoff? Hide you head in the sand or confront the situation?

Becoming a Level 5 leader

Collins suggests that you don't obsess on this as it is not the only criterion for GTG and maybe not even the main one. He suggests that if you follow the other ideas from GTG then you will become a Level 5 leader anyway.

Leadership is important but what you lead your business to do is more important. Actions are crucial in the pursuit of greatness as is surrounding yourself with the right people — and getting rid of the wrong ones.

Brian Chernett is the founder of The Academy for Chief Executives and Chairman of Academy Group ACE2. Having stepped down as Chief Executive of the Academy, Brian is now developing his own coaching and mentoring business — Wisdom Forums - for senior executives and building a new charity, The Ella Foundation, to coach and mentor Chief Executives in Charities and not for profit business.

Watch a video of Brian Chernett, Founder of The Academy For Chief Executives, explaining how The Academy For Chief Executives inspires business leaders.

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