The new leaders value empathy and vision

The new leaders: When Microsoft’s Nadella speaks about leadership he talks about empathy, while PayPal’s Schulman talks about inspiring hope.

Leaders lead by inspiring others. But where do they find their own inspiration to lead? I was watching a Facebook Live interview with Paypal’s CEO Dan Schulman, and Microsoft’s CEO Satya Nadella, and what struck me were two things. First, when Nadella spoke about leadership he talked about empathy. He considers empathy the primary source of innovation, and innovation is a critical driver of business growth. Through empathy, he says, we begin to understand customers’ needs. Not just their stated needs, but their unarticulated ones.

Remarkably few business leaders employ empathy effectively, partly because it is considered a “soft” skill, and partly because it entails risk. Nadella not only understands both of these issues, he embraces them, which is why I think he is truly one of the great business leaders of our time. But then, having praised Nadella, I was pleasantly surprised by Dan Schulman’s insightful comments as well.

PayPal’s CEO said that being a leader was about “defining reality and inspiring hope.” What did he mean by that? A business must be grounded in the reality of the marketplace or it will drift into oblivion. But at the same time, it must also find a way to inspire hope for the future in both its customers and its employees. Customers hope for better quality or more convenience or less cost, while employees hope for personal and professional and financial growth.

But the real insight which emerged from Schulman is that you must have both. Those who are only good at defining reality aren’t going to be very inspiring or motivating leaders. And those who inspire hope without a carefully orchestrated plan grounded in a clear path (reality) are really just dreamers.

As a side note, Nadella’s book, Hit Refresh, is a good one, but it isn’t as deeply personal a business book as, say, Knight’s Shoe Dog. But then again, how many CEOs are as quirky, or willing to be as vulnerable in print, as Phil Knight?

Since Schulman and Nadella are both American CEOs, they would tend to have an American perspective on leadership. To sample a Canadian perspective, I decided to take a quick look at three Canadian CEOs, each of whom is running a much smaller company but ones that are growing at breakneck speed. Tobias Lütke and Chris Bryson lead commerce companies Shopify and Unata, respectively, while Rachel Mielke heads up jewellery manufacturer Hillberg and Berk. They are three of the most innovative and fastest growing companies in Canada (Shopify’s market capitalization is already past USD ten billion), and while they articulate what leadership is in different ways, they’re living and breathing it in a remarkably similar fashion.

Shopify’s Lütke, for example, believes that people must be themselves and not ‘personas’ or caricatures of what they think they should be. “I have serious, serious problems with personas… with unauthentic individuals,” he said in a 2014 Globe and Mail interview. “I want nothing to do with people who are like this,” he adds.

Lütke was riveted by Daniel Pink’s book, Drive, and absorbed its key message about leadership: that people aren’t motivated by money but by autonomy, mastery, and purpose. Those three things are fed by culture, he believes. Culture plays such a big role in the company that Daniel Weinand was hired as the company’s chief culture and design officer. “Shopify is a very culture-driven organization,” says Toby Shannan, one of Lutke’s key managers. “You can manage less if everyone believes more.” In other words, if people are inspired, they do their best work every day on their own initiative.

Chris Bryson is the founder of Unata, whose self-learning software helps time-starved customers shop for groceries online. But the software goes well beyond simplifying the buying process. Unata is creating a one of a kind customer experience by adjusting and customizing recommendations and loyalty rewards based on customers’ individual shopping habits. As an example, Unata helped Longo’s transform its weekly flyer from a standard print paper version to a digital version that highlights relevant deals and specials for each individual shopper based on their past purchases.

What sets Unata apart from its competitors is their relentless focus on delivering a true 1-to-1 online shopping experience that is fully personalized for each customer using machine-learning software similar to that employed by Amazon and Netflix. Bryson believes the company will keep ahead of its competitors because it is “insanely” committed to technological innovation. But Bryson is committed to something else which may be even more important: visionary leadership. He delivers countless speeches and presentations. this helps promote his company’s product, of course. But to me, there’s a bigger reason: he wants to cement his vision into the landscape by drilling his message over and over again, and in so doing, inspire his own employees to take ownership of the vision and lead their own initiatives.

When Regina-based Rachel Mielke received funding from Dragon’s Den billionaire Brett Wilson back in 2008, her company really took off. Wilson recognized her vision, leadership and passion for her business, which is clearly reflected in her company’s manifesto: “Through education, inspiration and opportunity, we are women empowering women … one sparkle at a time.” As Regina’s Leader-Post notes, she puts her money where her manifesto is, having contributed more than half a million dollars to organizations assisting women entrepreneurs.

Rachel’s company, Hillberg and Berk, designs and manufactures a unique line of alternative jewellery with retail locations in Regina, Saskatoon and Edmonton while being wholesaled at 90 different locations across Canada. Although she manages over 150 employees, being a true leader really means being a coach, not a manager. And that means delegating power and responsibility—including creative direction—to others. Which is why she now shares creative responsibilities with four other designers.

Mielke’s leadership philosophy is centred around creativity and self-empowerment. One simple example: every member of her staff is invited to design their own pieces during the company’s monthly One-of-a-Kind Fridays. When I visited the company’s website, I was so impressed by what I saw that I bought a bracelet for my partner. The process was remarkably quick and simple, and delivery is free. It’s not surprising the company is growing like gangbusters.

What do these five leaders have in common? They share the two leadership traits that Schulman revealed to us in his interview: 1) the ability to define a real-world vision based on a market need and 2) the ability to inspire the people they serve (their customers) and the people they work with (suppliers, employees and stakeholders) to make that vision come to life.

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