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GILD 2013: 9 Leadership lessons from a CEO

November 1, 2013
Ronald L. Nelson, recipient of the 2013 Warren Bennis Award for Excellence in Leadership

The following is excerpted and adapted from the acceptance speech given by Avis Budget Group Chairman and Chief Executive Officer Ronald L. Nelson upon receiving the 2013 Warren Bennis Excellence in Leadership Award, which was presented to him at the Global Institute for Leadership Development, Palm Desert, CA, Oct. 8, 2013.

I tend to think of leadership as a very individual trait. For me, it is about a collection of experiences and relationships that helped shape how I have dealt with people, with adversity, and also with successes over the course of my life and career. I believe leadership is defined as much by your personality as it is by the skill set you develop by experience and through training.

I don’t take myself too seriously, but I do take my job seriously. I think that drives an esprit de corps at our Company that creates a positive working environment and minimizes the “regal nature” of the CEO position. It makes me and my position much more approachable at all levels of the organization, allowing for more effective communication. People feel much more free to speak their opinion.

I think it’s important to recognize that everyone is an individual. With my own direct reports and those people I interact with most on a day-to-day basis, I try to make an assessment of what drives and motivates them and then attempt to play my game on their field. And while I try hard to be very consistent in the message that I deliver, I do try to deliver it in a way that resonates with their individual personality. For some people, that means being very direct; with others, just the opposite. Every individual responds to criticism and praise differently, and the art is finding the right balance with each one. That’s why I make the investment to get to know my team beyond their name, rank, and serial number.

In most all organizational cultures, demeanor is important. In ours, I try to be a very calm person under most all circumstances, because I believe it helps provide a sense of confidence and security throughout the organization. In difficult times, people want to be led, they want to know everything is going to be all right and the CEO’s demeanor can say legions that words don’t always convey.

I don’t need or want to be the smartest person in the room. I pick and choose my spots where I need to assert my position, but I believe strongly that everyone needs to win sometime. When I do feel like someone is missing the point, I find the most effective way to assert my position is to ask the right questions. It will usually uncover the flaw in either my or their logic, without having to stake out positions where there is always a loser and a winner.

I think this notion of always trying to be right stands in the way of developing the human side of the skill set necessary to lead. You don’t need to do any job for very long to learn there are a lot of gray areas in business—it is folly to think there is only one right answer, and even more folly to think that you will always have it.

I make a standard speech at every senior or off-site staff meeting where we really need to get something done, and that is that everyone should park their title at the door. We are all equal when it comes to debating an issue, and no one should feel the stigma of the org chart as inhibiting their participation. I always reserve the right to make the decision, but honestly, it rarely has to happen that way—smart people focused on the same facts almost always come up with the same or similar solutions. I also think it’s important in these kinds of settings to never be the first one to speak—it inevitably colors the conversation and stifles the discussion.

I think being a really good listener is critical. I care what people say, but more importantly, I know they want to be heard. In most circumstances I find if you give people the opportunity to fully speak their mind, they deal with disagreement much better; if you cut them off, or fail to give the opportunity to be heard, you eventually undercut their desire and motivation, which doesn’t lead to anything good.

Finally, I think my most important responsibility is hiring and motivating senior staff and protecting the organizational culture.  If I’ve done that job well, I actually think a big part of leadership, in a general sense, is being a follower. What do I mean by that? Well, a number of things:

  • Smart people have good ideas that should be supported; I try to give them plenty of runway and encouragement, and let them lead. It breeds trust and confidence. When something is achieved, let the team or the individual be out front and take the credit; follow behind. If you’re the person with ultimate responsibility, you’re going to get credit or blame no matter what happens, but the psychic goodwill that is created by allowing one of your people to stand out and take credit is enormous.
  • Follow success with reward; it doesn’t always have to be monetary; again, psychic reward is often just as valuable. We have recognition programs at all levels of the organization; I encourage all managers to take advantage of these because they really do work.
  • Finally, follow failure with review—make sure everyone understands the “why” behind the failure, but more importantly, let everyone know that failure is part of success. If failure isn’t tolerated, there eventually is no risk-taking, and if there is no risk-taking, you are unlikely to sustain a high level of achievement.

At the end of the day, I think a big part of the human side of the leadership equation can be summed up in a single word—respect. I think that if you show respect, you will be given respect; mutual respect drives accountability and is the basis for accomplishing almost everything that needs to be accomplished within any organization.

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