What Makes a Leader?
When picking successors, family companies usually lack objective data on behavior, motivation, and values. John Cleaver's system for measuring these subtle qualities reveals patterns in family business leadership.
What do executives most want to know about the people who work for them? Years ago John Cleaver asked some 2,000 executives who attended his firm’s management development seminars to rank 13 qualities they find most important in managers and employees. Surprisingly, the qualifications that get the biggest emphasis in hiring decisions—education, work experience, personal projection in interviews—did not appear at the top of the list. Instead, what the executives ranked highest were intangibles, such as internal motivation, behavioral patterns, and values.
In a lifetime of consulting to companies, Cleaver has learned that the subtler psychological requirements usually fall outside the normal frame used in making decisions on hiring and promotions. The result: Countless employees are not well matched, by disposition or motivation, for the positions they hold. They are unhappy, underproductive members of the “Thank-God-it’s-Friday” crowd.
If many employers have blinders on when evaluating employees, owners of family business owners, who must assess the motivations of loved ones, are even more in need of objective data. About a third of the Cleaver Co.’s clients over the years have been family companies, and he has tested the fitness of many successors and other relatives for the positions they hold. As in nonfamily companies, he often finds mismatches. And deeply held biases often cloud reactions to the data.
John Cleaver studied psychology at Princeton. His firm, which is now in Adamsville, Rhode Island, specializes in career counseling and management development. Most of its assessment work is guided by three instruments which he developed early in his career.
One is called the Human Factor Job DISCription and is filled out by employers or supervisors; it asks them to describe what personal qualities are needed for each specific job. The second, called the Self DISCription, is filled out by employees or job applicants; it asks them to choose the quality that is “most like” them and the one that is “least like” them in each of several groups of adjectives. In one group, for example, the applicant makes two choices from the adjectives “competitive,” “outgoing,” “considerate,” and “harmonious.” A third instrument measures “motivating values” and indicates what field the person would prefer to be in.
With the results of these instruments, Cleaver analysts report to the client on how the employee or applicant’s values and aspirations match up with the requirements of the job. Unlike longer, more cumbersome psychological tests, Cleaver’s are short-answer forms that can be filled out in about 10 minutes. The questionnaires are deceptively simple. Their ability to predict performance has been scientifically validated over the years, Cleaver says, in measurements on varied populations, from airline pilots to bank branch managers, from oil well fire “extinguishers” to ball-bearing grinders.
At an age when most people are retired, the 75-year-old Cleaver, called “Clipper” by his friends (a sobriquet he earned in private school as a member of the swim team), remains highly motivated to carry his message about the neglected human dimension in workplace decisions to managers across the country. He talked with Family Business about his experiences counseling family firms, and gave us the mini-case studies shown on the following pages, which illustrate how his behavioral profiles help resolve some dilemmas he has encountered.
Family Business: When a family company comes to you, what generally is the real problem? What are they asking for?
John Cleaver: They are asking for leadership.
FB: They want you to pick a leader?
Cleaver: Right. One example is a family company that dominated the media in their community (Case A at right). The father was a very authoritarian man who made all the decisions at work, and he had a strong wife who made all the decisions at home. And the son never had a chance to grow into his own person. He depended on his father for everything.
And then the father died. The son was given the business, and he was hopeless. So the senior managers came to me and said, “Our careers are at stake. Find our leaders, because the son, the heir, is not one. We all know that.”
FB: So you will do an assessment of who can lead the company and how capable the successors are.
Cleaver: Yes. We also teach management skills. I’ve been working for about 12 years with a company that now has 14 family members in management. We took the management team and tested them with the Self DISCription. Then we gave them a course in how to measure, understand, manage, and develop people. Those four words are the key to what we do—measure, understand, manage, develop people.
We are continuing to help them become professionally competent at the top of the company. We have built one family member to the point where he will become the chief operating officer.
FB: How did you select him?
Cleaver: We didn’t choose him. He was apparently one of the leaders of the family and was given to us as a man to develop. The family didn’t want to go outside to recruit a COO because they said no one would have the loyalty, the values, of the family. So we have worked with him to make him a better sales and marketing manager. We have now recommended that he become COO, because he has learned a lot about how to manage people.
FB: I imagine you are often in a difficult position when a parent who has children in the business asks you to assess them and help choose a successor.
Cleaver: Yes, sometimes we have to pick the middle son or sibling rather than the oldest, who feels entitled to the job by birth. We do make difficult choices like that. In one case, the daughter was a better choice than the son. But the owner was biased in favor of his son and would not consider a woman. I have run into some pretty strong biases that way.
FB: So the people who hire you don’t always take your advice.
Cleaver: They do, I would say, about 75 percent of the time. But in some cases emotion gets the better of logic. The business owner wants certain things to happen. And it’s almost like the attitude of royalty: They feel that because they own the business, they don’t have to make choices based on merit.
FB: You tend to feel that business owners lack understanding of human behavior and motivation. Why don’t they pay attention to these things?
Cleaver: These are intangibles that they can’t touch or feel. Most people don’t believe in behavior because they don’t know what it is. But everyone has a behavioral pattern that they bring to work, and it is absolutely consistent.
One father came to me and said, “I want you to change my son. I want you to make him more aggressive.” And I said, “Well, I can’t do that. But I can build around him. If you want him to be president, he is going to need a strong, balanced team to help him.”
FB: You also seem to think that many people are in jobs for which they are ill-suited by temperament or motivation.
Cleaver: When people are hired, they are usually chosen on the basis of their education, experience, and personal projection in the interviews. As a result, I would say about 70 percent of them are misplaced. They are not in jobs they like and are enthused about. I can’t stress enough that management simply does not establish standards for the human requirements of the job.
FB: Which is what your system, I assume, helps them with. How do your instruments differ from standardized aptitude and psychological tests that many companies use to assess job candidates?
Cleaver: Our instruments are job-related. First the employer or supervisor fills out an instrument describing the skills and behavioral characteristics needed in the job. Then the employees or job candidates fill out a separate instrument which tells us how well they match up with those specific position requirements.
On most psychological tests, the candidate’s score is compared with the average scores of a big population group, but those tests may not have anything to do with the job criteria. In our opinion, the requirements must be established by the supervisor, the one who in the final analysis must be satisfied.
FB: Your Self DISCription asks people to select adjectives that best describe themselves. Aren’t they going to try to emphasize the qualities they think the employer wants, in order to get the job?
Cleaver: The whole instrument measures a latent pattern and an aspirational pattern. From that, we derive a total pattern which reveals any conflict between the two. We can tell when, for example, a person who aspires to be a salesman and tries to project himself as friendly is really shy deep down.
I would say that a slightly growing percentage of people try to “fudge” on the test. We used to get about 2 percent whose responses showed distortions. Now it’s about 5 percent. It’s a trend in the U.S. to try to feature “style” over “substance.”
FB: Most companies have job descriptions, based, I assume, on what supervisors and job-holders say are the characteristics needed in the position. Do you feel these job descriptions normally neglect the behavioral component?
Cleaver: Exactly. For example, the job description can define the responsibilities of the position but can’t tell you precisely how much personal authority is needed in the job or how to measure it.
FB: How do you define authority? How do you measure it?
Cleaver: We measure four dimensions on the Self DISCription. The first is “drive to accomplishment in spite of opposition.” Now drive is a common word, so the qualifying phrase is critical—”in spite of opposition.” What is measured is how hard a person will continue to fight under conditions of adversity.
Second is “influencing people to act positively.” This is a quality you want in both managers and salespeople. If you are high in ability to influence people, it obviously means you are good at persuading them to do what you want.
Third is “steadiness to perform consistently,” in a predictable manner. Most jobs call for steadiness. They require the person to work in one place, with one product, over a long period of time, and to have the patience to do some things over and over again. But managers with a sense of urgency score very low on this dimension.
Fourth is “compliance in adapting to standards.” What this measures is the person’s capacity for following the rules and procedures and doing precise, accurate work. Those qualities are usually essential on the plant floor, where, for example, a worker may be handling ball bearings so tiny that 1,000 of them can be put in his or her hand. To maintain product quality, this worker must be self-disciplined and able to concentrate on the work for long stretches in order to avoid mistakes.
The differential between the first dimension and the fourth, between drive (D) and compliance (C), is the amount of authority the supervisor gives the person in the job—or the person is willing to take. The higher you go in the corporate hierarchy generally, the more authority is needed in the job and the wider the gap between D and C. So the CEOs, for example, may be very high in D but very low in C. They are the ones who set standards, but they are not always very inclined to follow them.
FB: It’s said that power must be taken; it is never given. How does that work in family companies?
Cleaver: Consider the situation in one company we worked with (Case B). There was a father who was decisive, but at a magnitude lesser than that of his son. The son would take more authority than the father was willing to give him. This was an electronics company, and the Japanese had cut into its market share . The son wrested control away from the father and was able to rescue the business. He was more assertive than the father in the face of adversity.
FB: When you say the son “wrested control,” you mean the father was not willing to let go?
Cleaver: Right. I had three meetings with the two of them. The father was on the golf circuit but he couldn’t see giving up control. He wanted to remain chief executive and have all the benefits and his big salary. And the son said, “Gee, I’ve built a management team, and we’ve saved the company; they need the recognition.”
It was a classic case of conflict between a father and a son, with both of them wanting the power. We helped them work it out. The father retained the title of CEO, but the son and his team ran the company.
FB: Was the father actually putting the son down, preventing him from taking power?
Cleaver: No, the father was cheering him on, but he still wanted the power. We had trained the son and the time of the turnover was critical.
FB: What did you teach the son?
Cleaver: I have tried to teach him the need to understand behavior, motivation, and values in managing people. At first, he didn’t want to come to the training. But when he found out that he was strongly qualified to manage, he changed.
That is what we try to do with everybody. We emphasize that in addition to the usual criteria in selecting employees—work experience, education, and personal projection in the interview—managers must weigh behavior, motivation, and values.
And if I had to pick which of these groups is most important, I would say behavior, motivation, and values.
FB: I noticed that “internal motivation” ranks No. 1 on your list of 13 qualities that managers feel are most critical in any job. What exactly is internal motivation, and how does it differ from plain old motivation?
Cleaver: Nobody really knows what motivation is. I was at a class reunion in Florida recently and people asked me, “Are you still in the motivation business?” Well, you know, the football coach at Notre Dame is in the motivation business, too.
Companies are paying these very football coaches huge fees—IBM, for one—to speak about motivation. But there is “internal” motivation and “external motivation.” What these coaches do is external motivation, whipping people up with their success stories. You hear it on Saturday and forget it on Monday.
Internal motivation is the feeling within you that you have got to achieve something despite all odds. So people who work 70 hours a week, take every course they can, are constantly pushing to get ahead, are going to make up for a lot of deficiencies. In salespeople this is the most important requirement. Those million-dollar sellers of life insurance have high internal motivation.
FB: Some parents press their children to go into the family business before they really know whether the kids are motivated or suited for it by temperament and values. Would you advocate testing them at an early age?
Cleaver: Oh, yes. People in general make very myopic career choices. They are often unaware of the full spread of options available to them. In some families the kids start working in the business at the age of 13 or 14. The parents get them in the business early, and the children accept it as a career because that is all they know. Their developmental years are spent working in the business instead of going to college and traveling and doing other broadening things.
What happens then is you get the misfits who have aspirations and values totally at odds with what they are doing, and they are very unhappy. Patterns of leadership
|D = Drive to accomplish in spite of opposition||S = Steadiness to perform consistently|
|I = Influence on people to act positively||C = Compliance in adapting to standards|
(Horizontal line on each profile indicates the norm—the average score for all people so far assessed by the Self DISCription exam.)
This publisher, 64, dominated the media in a historic New England city. He owned the newspaper, and radio and TV stations. His behavior pattern showed him to be very high in D, which everyone who came in contact with him would confirm. He was the “cock-of-the-walk,” and bristled with an adversarial style. He was a master at micro-managing, undercutting his department heads and crushing their growth potential. He never thought he would die.
At his sudden death, the media empire was passed to his 40-year-old son, whose behavioral profile is the exact opposite of his father's. From the time he was out of the crib, the son had never had a chance to evolve into his own person. Dominated by the father, the son depended on him for everything and developed no initiative. After taking over as head of the company, he suffered a total nervous collapse. We were brought in to build a management team to run the company. The son has become a token chairman, “clipping coupons.”
The 57-year-old founder of this electronics business was very high on the second dimension—influencing others to act positively (I) . A great promoter, he did a remarkable job of marketing a product designed with the help of an acoustics engineer. He ran the company successfully for 30 years. Then the Japanese cut into the product's market share. The business was in trouble and headed for Chapter 11. A strong hand was needed at the helm to deal with adversity.
In a series of emotional meetings, we recommended that the founder’s son, 37, take charge. The son is higher than the father on the first dimension, D. Though the father had been the entrepreneur and loved the power, the son is better able to take the bold action under adverse circumstances. The father refused to give up the CEO title, but has agreed to let the son do what is necessary. The son has developed a management team and reordered the manufacturing process to improve product quality. The redesign has made it easier to assemble the product, and it has cut a phenomenal amount of waste in the process. The company has pulled back from disaster. Everybody wins.
We negotiated 10 critical issues that gave accountability to the son and preserved recognition for the father. The father not only received recognition for building the business, he was given credit for seeing to it that the company was saved. More important, he can be mighty proud for developing such a fine son.
The patterns shown are for three brothers who achieved outstanding success in the real estate development business. They have done it, in part, because they have complementary behavioral profiles and each has been able to accept the position for which he is best suited, which we helped them determine. (Note how each DISC signature matches the one for the job.) The president, 57, is shown at left. He is superb in his role: decisive, driving, urgent—a natural leader.
The older brother, 59, was creative, precise, and good at details. By the age pecking order, he thought he should be the leader, but he really did not want to deal with people. We convinced him that he was not a leader—a tough sell—but would make a strong chief financial officer. He has proved us right, to his own satisfaction and ours.
The youngest brother, 50, was good-natured and outgoing, but a bit of a dilettante. What could we do with him? He was High I—influencing others to act positively. On our recommendation, he became head of public relations, for which he is well-suited. Customers love him.
The business founder whose DISC profile is shown on the left had all the drive (D) required of an entrepreneur. In addition, he was a strong salesman (I). He built his tool-making shop from scratch, and he personally sold every account. His behavior profile matched the one specified for the job, as determined by the Human Factors Job Description.
The founder was getting along in years and wanted his son to succeed him as president. Finally, at 68, he turned the business over to his son, 27, who unfortunately has few of his father's characteristics. The son's behavior pattern is virtually the reverse of his father's—high in steadiness (S) and compliance (C) but below the norms for D and I. Because of a combined lack of leadership and sales, the business volume has leveled off and the company is fighting for survival. At the request of the father, the Cleaver Co. is training the son to build a strong management team around himself, particularly in sales.
This Yale man was president of a bank that had been founded by his father. High in both D and I, he had built the bank to No. 1 in its region. He was colorful, competitive, instantly decisive, and incredibly charming. He was counting on his only son, 22, to carry on the family name.
Once again we found a son with a profile that is the mirror image of the father's. The son is a traditionalist, a perfectionist (C) who possesses strong esthetic and low economic values. He takes after his mother rather than his father, who was rarely home. Under pressure from the father—and despite our advice to the contrary—the son was forced to join the bank as a trainee immediately after college.
After three months of training, he came to us and said bluntly, “I hate this.” Rather than go to his father, he asked us to intercede for him. We made an appointment with the father and flew down for the meeting. I can still see the face of this buoyant, bubbling personality, suddenly deflated like that of a circus clown. He was absolutely speechless. The son has left the bank and is now a successful publisher of fine-art history books.
The patterns shown are for two cousins who inherited stock in a business founded by their grandfather, which had been divided equally between their fathers. The cousins had each inherited 50 percent, and the business was in conflict. The younger one, 45, was president of the company, in charge of everything except engineering. As his profile at left shows (high in both D and I), he displayed the qualities essential for leadership.
The older cousin, 47, had the title of chairman and, because of seniority, ran the board meetings. In actuality, he was in charge of only the engineering department. Though he was a capable engineer, he lacked the qualities of a strong manager (low in I). His department was frequently behind schedule in getting out drawings, which stalled the production process.
Based on merit and leadership ability, we recommended that the older cousin report to the younger one. We supported the younger cousin's promotion to CEO. But because the older cousin owns 50 percent, he refuses to work for the younger one. Conflict! Needless to say, we are barred from working on his turf; our efforts are confined to helping build the president's organization, without the engineering component.What Managers Want to Know
The most important factors to be considered in hiring and managing people, as ranked by 2,000 executives who attended John Cleaver73146;s management development seminars:
1. Internal Motivation
5. Work Experience
6. Character, Integrity
7. Personal Projection
10. Financial Wisdom
11. Outside Influences*
*Such as family problems, obsessive hobbies, organizational work.