How Successful Leaders Think - Integral …

1 We look for lessons in the actions of great Leaders . We should instead be examining How Successful what goes on in their heads . particularly the way they Leaders Think creatively build on the tensions among conflicting by Roger Martin ideas. Included with this full-text Harvard Business Review article: 1 Article Summary The Idea in Brief the core idea The Idea in Practice putting the idea to work 2 How Successful Leaders Think 9 Further Reading A list of related materials, with annotations to guide further exploration of the article's ideas and applications Reprint R0706C. How Successful Leaders Think The Idea in Brief The Idea in Practice The secret to becoming a great leader? What does integrative thinking look like in STEP 3: ENVISIONING THE DECISION'S.

2 Don't act like one, Martin advises. Instead, action? Contrast conventional and integra- OVERALL STRUCTURE. Think like one. tive thinkers' approaches to the four steps of Conventional thinkers break a problem decision making: into pieces and work on them separately. Inte- Brilliant Leaders excel at integrative thinking. They can hold two opposing ideas in their grative thinkers see a problem as a whole . STEP 1: IDENTIFYING KEY FACTORS examining how its various aspects affect one minds at once. Then, rather than settling for choice A or B, they forge an innovative Conventional thinkers consider only obvi- another. third way that contains elements of both ously relevant factors while weighing options. Example: but improves on each.

3 Integrative thinkers seek less obvious but po- Young held several issues in his head simul- tentially more relevant considerations. Consider Bob Young, cofounder of Red taneously, including CIOs' concerns, dy- Hat, the dominant distributor of Linux Example: namics of individual and corporate markets open-source software. The business model Bob Young disliked the two prevailing soft- for system software, and the evolving eco- Young created for Red Hat transcended the ware business models: selling operating nomics of the free-software business. Each two prevailing software industry models software but not source code needed to piece could have pushed him toward a winning Red Hat entr e into the lucrative develop software applications (profitable separate decision.)

4 But by considering the corporate market. but anathema to open-source advocates) issues as an interrelated whole, Young or selling CD-ROMs containing software began to realize only one player would ulti- How to become an integrative thinker? Resist and source code (aligned with open-source mately dominate the corporate market. the simplicity and certainty that comes values but not profitable). Seeking a third with conventional either-or thinking. choice, he considered CIOs' reluctance to STEP 4: ACHIEVING RESOLUTION. Embrace the messiness and complexity of buy new technology that would be compli- Conventional thinkers make either-or conflicting options. And emulate great cated to maintain. Viewing their reluctance choices.

5 Integrative thinkers refuse to accept Leaders ' decision-making approach as relevant eventually helped Young see conventional options. looking beyond obvious considerations. that selling software service would be a su- Example: COPYRIGHT 2007 HARVARD BUSINESS SCHOOL PUBLISHING CORPORATION. ALL RIGHTS RESERVED. Your reward? Instead of making unattrac- perior alternative to the existing product- based business models. To pursue market leadership, Young devised tive trade-offs, you generate a wealth of an unconventional business model. The profitable solutions for your business. STEP 2: ANALYZING CAUSALITY model synthesized two seemingly irrecon- cilable models by combining low product Conventional thinkers consider one-way, lin- price with profitable service offerings.

6 Red ear relationships between factors: more of A. Hat began helping companies manage the produces more of B. Integrative thinkers con- software upgrades available almost daily sider multidirectional relationships. through Linux's open-source platform. It Example: also gave the software away as a free Inter- Young analyzed the complex relationships net download. Thus, Red Hat acquired the among pricing, profitability, and distribu- scale and market leadership to attract cau- tion channels. He recognized that a prod- tious corporate customers to what became uct based on freely available components its central offering: service, not software. would soon become a commodity. Any electronics retailer could assemble its own Linux product and push it through its well- developed distribution channel leaving Red Hat stranded.

7 Analysis of these causal relationships yielded a nuanced picture of the industry's future. page 1. We look for lessons in the actions of great Leaders . We should instead be examining what goes on in their heads particularly the way they creatively build on the tensions among conflicting ideas. How Successful Leaders Think by Roger Martin We are drawn to the stories of effective Leaders forcing managers to look for opportunities in action. Their decisiveness invigorates us. beyond the con nes of a narrowly conceived The events that unfold from their bold moves, market. Trying to learn from what Jack Welch COPYRIGHT 2007 HARVARD BUSINESS SCHOOL PUBLISHING CORPORATION. ALL RIGHTS RESERVED. often culminating in Successful outcomes, did invites confusion and incoherence, because make for gripping narratives.

8 Perhaps most he pursued wisely, I might add diametrically important, we turn to accounts of their deeds opposed courses at different points in his for lessons that we can apply in our own career and in GE's history. careers. Books like Jack: Straight from the Gut So where do we look for lessons? A more and Execution: The Discipline of Getting Things productive, though more dif cult, approach is Done are compelling in part because they to focus on how a leader thinks that is, to implicitly promise that we can achieve the examine the antecedent of doing, or the ways success of a Jack Welch or a Larry Bossidy if in which Leaders ' cognitive processes produce only we learn to emulate his actions. their actions. But this focus on what a leader does is mis- I have spent the past 15 years, rst as a man- placed.

9 That's because moves that work in one agement consultant and now as the dean of a context often make little sense in another, business school, studying Leaders with exem- even at the same company or within the expe- plary records. Over the past six years, I have in- rience of a single leader. Recall that Jack terviewed more than 50 such Leaders , some for Welch, early in his career at General Electric, as long as eight hours, and found that most of insisted that each of GE's businesses be num- them share a somewhat unusual trait: They ber one or number two in market share in its have the predisposition and the capacity to industry; years later he insisted that those hold in their heads two opposing ideas at once. same businesses de ne their markets so that And then, without panicking or simply settling their share was no greater than 10%, thereby for one alternative or the other, they're able to harvard business review june 2007 page 2.

10 How Successful Leaders Think creatively resolve the tension between those One was the classic proprietary-software two ideas by generating a new one that con- model, employed by big players such as Mi- tains elements of the others but is superior to crosoft, Oracle, and SAP, which sold custom- both. This process of consideration and synthe- ers operating software but not the source sis can be termed integrative thinking. It is this code. These companies invested heavily in discipline not superior strategy or faultless research and development, guarded their execution that is a de ning characteristic of intellectual property jealously, charged high most exceptional businesses and the people prices, and enjoyed wide pro t margins be- who run them.