The Guru Is In

Twelve steps to leadership development

By David A. Smith
November 3, 2017 5 min read

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Bill Bernbach, when he was building the most exciting advertising agency of his time, had a round conference table. He tried the customary rectangular one, but “the junior executives always sat at the foot and I sat at the head, and I learned that the light of conviction is often in the eyes of the juniors. With a round table, I was closer to them and less likely to miss it.” 

If a true test of a company’s sustainability is its ability to transition from a founding or visionary CEO or leadership team to a next generation of both, then the affordable housing industry is in a watershed, where we are about to discover how many of today’s leading companies will still be so in half a decade.

The tax credit business is 30 years old, and while many have rightly celebrated its success as a program, we’ve underappreciated just how many of these platforms are still being run by their founding generation: CEOs or executive teams who came of age in the early 1990s, and who have risen with LIHTC into the positions of gray prominence they now occupy on industry gathering lecterns and panels. And though we Boomers often refuse to acknowledge our age, even to ourselves, at some point the R word creeps into our thinking, and with it the flattering rationalizing question, But who could possibly replace me?

As a starting point, remember back to when you were 30. What were you doing? Against what were you chafing? Would 30-you have liked working for 60-you? To create the environment that 30-you would have wanted to work in, try these dozen steps:

1. Look inside your entity, not outside. Your next visionary CEO is probably already inside your own organization; you just need to give her or him chances to demonstrate it.
2. See that leadership development equals knowledge transfer and vice versa. Younger people are just as smart as we are/ were: what we possess that they lack is the combination of knowledge and experience – and the wisdom that comes to those who have survived long enough to acquire all that knowledge and experience.  Ambitious people want to learn, and ambitious Millennials want to learn even more than we did. Leaders grow when taught what they want to learn.
3. Mix up the ranks, mix up the ages. When you’re forming a task team, deliberately mix up the ranks; aside from bringing perspective diversity instead of a gerontological conformity, it will create an ideas- governed rather than seniority-governed interchange.
4. Take all thoughtful ideas seriously. Ideas can come from anywhere. If it failed 15 years ago, maybe it’s time to try again in a different way, because a lot has changed in 15 years.
5. In intra-company discussions, let the least experienced vocalize first. If you haven’t told them what you think, they’ll do their own thinking – and besides, you’d like to be surprised now and then, wouldn’t you?
6. Create career paths that don’t require job transfer or company transfer. Don’t make them choose between being pigeonholed or having to lateral out, because you really won’t like the adverse selection that results.
7. Recognize that technology adoption is inversely innovative. Younger people are always faster adopters of new technology, and being faster at that adoption, they’ll be naturally more creative in deploying new technology and putting it to better use.
8. Give them external visibility and unchaperoned but supported interface. The next time you’re invited to an industry gathering of the usual suspects, send someone else in your stead.  What’s old to you is new to them. The ones who will be future leaders will take it seriously, study up furiously, surprise themselves with their success and come back energized.
9. Praise and thanks. No one ever gets tired of either. Make sure both the praise and the thanks are particular —connected to a particular event, action or insight—and delivered in response to the thing that moved you to praise or thanks.
10. Cross-train them holistically about the tax credit ecosystem and your entity’s value proposition, core competencies and core business. Leaders are people who have large and constantly updating mental maps of their business space.
11. Give them autonomy within defined parameters. People lead when they have freedom to use the entity’s assets. They learn to lead by borrowing some of the entity’s assets for what they believe will be entity purposes. Whether those parameters are organizational cash, platform level risk, time taken away from feeding the machine to think about brand new things or continuing education (including self-directed, such as attending an adjacent-sector conference), there can be no leadership without autonomy beforehand.
12. Try reporting to them for a while. If there’s a new task or assignment, put the next generation in charge of it and tell her, him or them, “You’re in charge of this; I’m not. I’m on call to you. If you need something just ask me for it.”  Then, when they ask, respond as promptly and helpfully as you would to your owner, board chair or spouse.

As I’ve written before in this column, in any power relationship, the one with the power must trust first. To discover your new leaders, trust your people, run interference for them and get out of their way.

Leadership development means giving things away.  Give away knowledge, give away control, give away power.  You’ll never find out who can use these things until you give them away.

Conversely, if you don’t give it to them, they’ll go to work for somebody who will – who might even be themselves, when they’re founding the company that will one day eat your lunch.