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Leadership That Pays
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By Mike R. Jay

Relevance, responsibility and results is the next revolution of the new economy!

You have to ask a couple of questions. One is "How well respected is the management?" When people quit, they tend to leave because they´ve lost faith in their manager. A management team with a lot of respect can do a much better job of retaining employees in such an environment -- which is why historically a company like Microsoft , Intel, or Cisco could turn on a dime, do radically different things, and still have people say, "Okay, we´ll follow.´´ I sometimes think the key to leadership is having people willing to follow you, if only out of curiosity to see what´s going to happen.

Marc Andressen in a Fast Company Interview to George Anders http://www.fastcompany.com/online/43/andreessen.html

What if people paid you to lead them?

Most people are still stuck in the old economy, whether they dress it up with fancy language and metaphor or not. The real leadership came about with the dawn of volunteerism. No wonder Peter Drucker has spent so much time talking about the best place to grow future leaders is non-profit enterprise. Well, even non-profits are for the most part old economy and much of the volunteerism would exist without the leadership available, even though leadership helps.

No, what I´m talking about is a new form of leadership, where people vote with their resources. You lead because you have a constituency that will pay you to lead.

What is so different about paid leadership?

The first thing is that the only way you become a leader is to have a following who is willing to invest their time, money and attention in what you are building. The second thing that comes to mind is that you have to continue to provide value or your followers are gone in a heartbeat! Third, if you´re helping your followers become successful, then the likelihood of you perpetuating your leadership very long is pretty much a forgone conclusion. And finally, paid leadership is validated with each exchange of resources from the followers to the leader. There´s no escape, no back rooms, no hide and seek with paid leadership.

In my view, it is the easiest thing that exists to determine effective leadership. All of this rhetoric going on about leadership in the old economy is just that, talk. Followers are captive and if they had a choice—most of them think they don´t—they would be gone in a heartbeat…taking their leadership capital with them.

What gives with paid leadership?

I discovered the concept while thinking one day what I was doing in my own virtual business model. I´ve been talking and teaching leadership for some time now. For me, this evolves out of the mystery of why I always seemed to want to lead, to be out in front, to be setting the pace. I´ve been a leader all my life, just not a very good one. Over time, I´ve continued to search for the holy grail of leadership and the fact is—just like enlightenment—it isn´t out there; it is, and always has been in here. The question is: What is effective leadership and, where is it most effective?

The key to effective leadership is followership.

Now, I know I´m not saying anything new here. The adage about the only good leader is one who has followers is pretty much true, except when we consider all the variations in effective leadership that have created calamities in our history. I won´t name them, you are aware that not all effective leadership is good. However, allow me to sidestep that for a moment to consider the following adage: effective leadership is determined by the number of people willing to follow.

In today´s world, this means not only following, but investing or committing scare resources. Whether it is based in talent, money, time or attention, effective leadership in the new economy is paid. No matter how you view this, you can see that the democratization of technology, finance and information, are moving us to free flowing organizations. This follows what the pundits have declared is emergent, fluid, adaptive and gone just as fast as it came to being.

New Economy Business Models & Leadership

In the new economy, largely riding on the backs of knowledge work, we find a distinct flow to the response to the transparent, adaptable and connected nature of knowledge and information. People are no longer willing to merely follow along like cattle as they wait for their paychecks. They no longer trust the system because the system is no longer predictable, stable or certain. In fact, the only thing that is constant and certain to occur is change. Again, nothing new.

Several studies have indicated that within the next 10-20 years the number one employer will be self. This supercedes temporary work (now #1), in my view. This transition is much like the one taking place on the Internet among all the dot songs being played around the world. We have never heard the great sucking sound which as Buckminster Fuller said is, "when you flush a toilet, it goes somewhere."

The cycle is not a cycle, we´re never coming back!

Much like the buggy whip manufacturer at the turn of the century, we face the unknown in a new way. . This transition is going to be one of the most devastating periods of time for some people. Those people who think this is a cycle and think things are going to return to normal are in for a rude awakening. So what´s a person to do? I am suggesting that you take matters into your own hands. Forget that anyone but you has responsibility for your livelihood and your success. Take whatever steps you would take if you had to depend just on you.

Enter paid leadership.

If you take a moment to consider what the world would be if you couldn´t trust any of the old ways or that you had to take complete responsibility for your own welfare, what would you have to be, have and do? There are answers for each and every one of us. This doesn´t mean that we all become a bunch of mavericks who begin hoarding and building bomb shelters, like so many of our parents and grandparents did in the 60s. What it means is that we need a new paradigm of action.

What if we were to pay our leaders to lead? NO, not a salary, but we´d personally write a check for leadership. Think about the difference! As a person who directs his own resources, you write checks everyday…to pay bills, to purchase things and to pay for your way of life. Why not pay for leadership?

You´re already paying for leadership, you just don´t see it that way. When you buy a product, you´re paying for that company´s leadership. If you don´t buy things, leaders get changed so you do!

It is no wonder that "two-thirds of all major companies world-wide have replaced their CEO at least once since 1995, according to a recent survey by consultant Drake Beam Morin, Inc. More than 1,000 U.S. CEOs have left office over the past 12 months alone..." [Business Week, December 11, 2000].

Now, let´s look at this from another angle. If virtual business models, soon to be the model of choice due to lack of overhead, shift from fixed to variable costs and speed, we´ll pay for leadership. Here´s my example. I run my business out of my domestic command center [my home]. People in my network pay me for leadership. I coach, teach, mentor, counsel and lead people in a virtual community. This community extends throughout the world. Our 100 or so members only get my leadership when they pay for it and I only lead when I´m paid. I can´t afford to do anything else. I have a light bill to pay, college tuition to deal with and a leadership challenge that forces me to stay on top in order to be able to lead. What I´m really saying is this. If I don´t lead well, people don´t pay me. To the extent I´m paid, I can develop my leadership, my community and my business model. It´s just that simple. If I don´t lead well, I don´t get paid.

Leadership that´s crazy?

Now most naysayers will say that is a crazy model of leadership. Crazy perhaps, but efficient. And of course, few have thought the market hand could decide effective business leadership. There is no social program around that doesn´t depend on people paying leadership. We just don´t think of it that way.

What if all the leaders in organizations only got paid when they were delivering value?

No more hiding behind the office. If he wants to get paid, he has to deliver value. If he has to fire a bunch of your community, his pay will go down because the number of people paying for his leadership will go down. Every choice would be would be immediately relevant! Just as they are in the real world.

You see, relevance would be the key... If leadership is not relevant, then how can it be effective? If the leader doesn´t learn, produce new value for his community and continue to deliver that value over time, he won´t get paid. There is no insulation from the relevance and effectiveness of leadership. There is no delay, it is immediate and it calls for an immediate shouldering of responsibility, action and reformulation. There is no gap between the leader and the followers, there is only their confidence spending their hard-earned resources to purchase their leadership.

The old economy protected us.

Layers of authority, levels of command and control have obfuscated the impact of cause and effect around leadership. Leaders have been able to find a way to deflect, redirect or point fingers at someone else. No more. The very horse the leader rode in on has come back with a new rider. on a horse of a different color. It is called the new economy, and it brings with it the 3 Rs relevance, responsibility and results. Here there are no places to hide bad leadership. It would be found out immediately and disciplined by reduced money flows and the lack of attention. There is no buffer, there is no us and them, there is only what is and what is not.


As we move forward into the transition between old and new, we are NOT coming back. There is no return from this frolic with technology moving globalization forward at a rapid pace. We have seen the enemy and it is us. What goes around has come around and there is no other avenue to the future. It´s simple, if you want to lead, then you have to deliver value.

I constantly tell my college-aged children, "the world you grew up in is NOT the world you´re going to work in." As hierarchy peels away to reveal the closeted leaders of the old economy, leadership will change. It will become faster, more connected to cause and effect, more relevant and more responsible to the people who pay for it.

Article courtesey of Family Business Strategies.

About the author: Mike R. Jay can be reached at http://www.leadwise.com. Mike R. Jay is a business and executive coach, author and speaker on personal and organizational development. He can be contacted at 1.877.901.COACH (2622) or by email . He is the author of COACH2 The Bottom Line: An Executive Guide to Coaching Performance, Change and Transformation in Organizations and the founder of BCoach Systems, a business and executive coach training system.

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