The fish always rots from the head

Intro

McLaren went from 5th to 1st in Formula One in 2 years. As CEO of a team of a thousand people, Zak Brown pinned all of that difference on changing 3 of his exec team. In other words – and in his words - ‘those same 997 have given us the car that’s won the world championship’. He went on say ‘the talent was there, we just needed to unlock it’. So here’s the thing – and do feel free to sit down before you read this: if you’ve got a performance problem, it’s more likely to be a leadership problem than a staff problem.

What's the issue?

Your business requires high levels of investment in technical expertise and development – from specialist recruitment to CPD to AI, digitisation and new systems implementations. And depressingly, most of that spend is likely to be more about just keeping up than getting ahead. You recognise people’s expertise (in part) through remuneration. As a rough guesstimate, if you’re running a professional services company with 500 people, your wage bill is going to be, let’s say, £30m. Which means they need to bring in, let’s say, £60m just to break even.

Running a highly expert organisation is highly expensive. No wonder there’s an expectation from the top table that your people will be self-starters, and that the focus is on these expensive technical experts to deliver rather than on the leaders being experts in leading them.

The problem is, there can be a big difference between self-starting and self-actualising (the latter of which is the only viable explanation for the McLaren turnaround). It’s one thing to do what the organisation wants without oversight, but it’s another to dig deep into realising your potential to do what the organisation needs to win.

Consider this

You’re spending a shedload on running your organisation. But what if - as was the case at McLaren - you’re not making the most of your most expensive assets? How much lost business is that costing you, and is there anything you can do about it? Zak’s predecessors had done the hard yards, and done them for years, gathering together a large team of experts capable of winning championships. But they weren’t even on the podium, because their people weren’t firing on all cylinders (thankyou, here all week).

Do you see around you potentially great people doing only good work because of average leadership? Of course you’ve got to invest in your systems and processes, data and analytics, infrastructure and brand. But in terms of the biggest bang for your buck, you might just be the next McLaren waiting to happen (ooh, how exciting!). You may already have all the expertise you need to make a step change in your performance. All you need is to give them the leadership of ‘challenge and collaboration’ as Zak highlights, to make it happen.

Zak changed 3 of his 10 executive team. Your organisation may need to be that brutal too, or it may not. ‘Changing your leaders’ might just mean that they’re a work in progress which needs some help to boost them. To illustrate, let’s paint by numbers: if by changing your leadership you could unlock an additional 1% of performance, then using the figures above, that would create an additional £600k of revenue – most of which is likely to be pure profit too. So how can you accurately pinpoint that 1%?

Well, you can’t really (not least because there’s so many moving parts in an organisation that anyone who tells you ‘this’ is directly because of ‘that’ is almost certainly guessing). It’s more about whether you believe that a) your leaders can change just a bit, and b) that your people can up their game just a bit. That 1% might be completely wrong. It might be 5%. Either way, empirical evidence demonstrates that it can be enough to go from 5th to 1st.

The Swedes have a saying: ‘the fish always rots from the head’ (which is biologically true). Culturally it fits well with their love of fish and socialism. More capitalist cultures default to blaming poor performance on the staff, but the Swedes start at the head. Maybe that’s why this small country punches way above its weight with its impressive list of global brands.

Try this

Leaders who fail to get anything approaching the best out of their people are usually tolerated, because it’s the norm. Which is why Zak Brown and his team’s results aren’t normal. You might well have become numb to the standard of leadership that exists in your organisation, and yet you know it could be better (why else are you reading this?). To help you think like Zak, envisage your leaders in one of two ways: are they pulling their people up, or are they keeping them where they are?