Chief People and Administration Officer
The Boeing Company
"Leaders - are we ready for the future? "
Boeing Long Beach Management Association
Long Beach Airport Marriott
June 19, 2002
Thank you very much for inviting me to join you this evening.
It is always a delight to visit California! I always enjoy my times here. I started the week here with a two-day Executive Council meeting in Irvine, a dinner on Monday night commemorating John Warner's retirement, an all employee meeting yesterday, a coffee roundtable today, and now this evening here with you at the Boeing Long Beach Management Association. I'm very happy to be here with you tonight and thank you for this opportunity. I'd like to speak this evening about leadership and the future. In fact, I'd like to ask the question, as leaders, are we ready for the future?
Whenever I'm preparing for a presentation like this, I like to look up historical events that may have taken place on the same date in past years. On this date - June 19th - in 1934, Congress passed a law creating the Federal Communications Commission (FCC), the new agency replacing the Federal Radio Commission. It's absolutely amazing to think about how communications technologies and tools have expanded since the establishment of this Commission sixty-eight years ago today.
We have personally experienced an explosion in communications tools and applications. Citizens band radio, television, data transmission, fiber optics, cell phones, pagers, the web, and wireless devices - one could go on and on.
This communications explosion has and will continue to play a critical role in the way we lead and run our business at Boeing. Just look at our business units: Air Traffic Management, Boeing Capital Corporation, Commercial Airplanes, Connexion, Military Airplanes and Missiles, Phantom Works, Shared Services, and Space and Communications. Not only do we rely on communications to run and grow healthy businesses; communications is now a significant part of our product and service offering.
I know that I personally count on having my cell phone and laptop communications services "connected and available" around the clock, 7 by 24, on a global basis. I could not do my job without these communications and business tools; I'm sure you couldn't do your job without these and other communications devices either. This explosion in technology and communications has much to do with the changing role of leadership. But before we get into those issues, let's talk about people.
I believe it is all about... people. It is all about "people working together as a global enterprise for aerospace leadership." As you know, this is our company vision. The vision starts with the word "people."
Our vision very purposefully starts with the word "people." We can never lose sight of the fact that our strength and competitive advantage is -- and always will be -- people.
Our CEO, Phil Condit, speaks very eloquently about this, and I repeat his words every time I have the opportunity:
"We work very hard and are very successful at delivering leading edge technology. We can work for years at a particular technology and be the first to market, but a competitor can come along and duplicate that technology immediately. However, they can't duplicate people. People are our competitive advantage. We can never lose sight of the fact that leaders need to focus on people every minute of every day."
My new role as Chief People and Administration Officer is to do just that... to help make sure we are doing all the right things to protect and nurture this competitive advantage.
Tonight I would like to share my personal perspective on leadership. And, highlight why and how this role is changing. I will offer you some ideas on how we can become more effective leaders in our increasingly dynamic environment. And, I will leave you with a few questions to explore....
Just after my new role was announced, a news journalist asked my thoughts on moving from "running a business" to my new role leading the "soft and fuzzy people and leadership stuff." I had to smile for a moment. If he thought there was anything soft and fuzzy about the people and leadership stuff, he just didn't "get it." I used that opportunity to share Phil's philosophy about people's ideas and innovation being our competitive advantage.
I also told this journalist the basic business principle I hold. I will share it with you tonight:
"Great leadership and involvement by all = good business."
It's really that simple. It's not one at the expense of the other. It's not either/or. It's both. And, it's so simple. Yet, it is hard because many of us grew up in a "command and control environment." That is, we did not invite - in all cases - employees to be engaged. And, we were rewarded and promoted for these actions.
Today's leaders must take courageous action. Business today is about action, bold action. Part of this action is... to "let go" of controlling everything. Leaders must support people in the risk-taking that is essential ... not only for people's personal growth, but also for the successful growth of our company.
Now I'm not speaking of risk involving the safety or integrity of the product or the brand. I'm speaking of encouraging personal risk, career risk. I am talking about fostering the innovation that will take us successfully into the next century. This is a new role for some, but not all, leaders.
Leadership is not for the faint-hearted. It takes courage, integrity, dedication and business savvy. Peter Drucker summed it up:
"Whenever you see a successful business, someone once made a courageous decision."
We work in a fast-changing and evolving world. And we work in a fast-changing and evolving industry. Today's leaders, and the leaders of the future, must manage that change to keep us competitive. And we must do so in a world in which the nature of leadership itself is changing. I believe this is our challenge... and I also believe this is our opportunity.
What is it that's happening in our workplaces that is causing the need for us to take a new look at leadership styles, and even a new look at the very role of leadership?
I believe one primary driver shaping leadership includes how work is being performed. Work is being performed more and more by teams. Whether we are speaking of the smallest of businesses or massive global companies or even of world powers ... teams are completing the work and accomplishing our goals. The ability to collaborate has become the key to the success of an enterprise.
What is causing this shift? One factor is that the primary tool of today's employees include what they bring to work - their intellectual capital. As well as professional skills, each team member brings to the table brains, thoughts, and ideas. Today's employee recognizes that the power of ideas is multiplied many-fold through collaboration. We can now go beyond the power of one person. Technology and advances in technology "friendliness" drive collaboration and the ability for people to work across functions, boundaries and borders. We collaborate across companies now because we can. We collaborate across industries and up and down the value chain because we can. We collaborate across the world because we can.
We collaborate because it adds value to our companies. It has enabled us to team with people we've never seen, to team with people whose language we don't speak, and to team with people without the boundaries of geography and time. Our world grows smaller every single day.
A few weeks ago I visited our Boeing office in Moscow. We have about 350 engineers in Russia, performing design work with partners in the United States. The engineers in both countries use the same tools and processes. They are on one Boeing team - on opposite sides of the globe. With the time difference in Moscow of let's say 11 hours on the West Coast... one group of engineers can work a design issue and 'hand-off' the work when he or she goes home to another engineer just arriving at work on the opposite side of the globe. We can work engineering solutions - virtually and globally, 7 by 24. A virtual team with a common business objective. Some people may never meet face-to-face... they collaborate and communicate via a common engineering process and tool.
Again, technology and collaboration tools have enabled us to team with people we've never seen, to team with people whose language we don't speak, and to team with people without the boundaries of geography and time.
As people start to collaborate and work from anywhere, the line between work and home blurs, and our dependence upon dedicated physical workspace (also known as 'offices') will decline dramatically. Employees will work from home, from hotels, from customer locations, from supplier locations, basically, from anywhere, because they can be productive from anywhere. In the future, I expect that physical office space provided by companies will be for collaboration and interaction, not for individual private workspaces.
Today's employee is not a "worker" who will stand for that command-and-control environment I mentioned earlier. Labor is starting to flow freely around the world as globalization and technology permits workers to seek opportunities anywhere - both in reality and virtually.
A new leadership question emerges. How will we lead a workforce and teams that can be almost anywhere? Before the infusion of technology in our lives, it was simple. People reported to work at a specific time of day and went home at a designated time. There was a supervisor or manager who made assignments and directed employee activity.
Today's employees work in teams and need leaders who are coaches and mentors, leaders who provide tools to support collaboration, and leaders who can successfully create an atmosphere where ideas flow and creativity is heightened.
How do we lead these bright people and teams? Successful leaders of today -- and tomorrow -- are leaders who have been able to evolve just as our workforce has evolved.
Teams are not the only factor impacting leadership of today and tomorrow. Technology dramatically impacts leadership. By 2010, it is possible that 95% of the people in the industrial world and 50% in developing world will be on-line. By 2050, it is possible that all the technological knowledge we work with today could represent only 1% of the knowledge that will be available at that time. A willingness to evolve and continue to learn is more than critical - it is essential. In the coming years, the application and adoption of technology will grow exponentially. And, our technology knowledge base, the information critical to set business strategy and decision making will be at a new baseline. As leaders we must capitalize on the potential that technology has to offer... to our business and to our people.
Technology creates transparency as we move to the future. That is, data and information is available in real-time to everyone in our company and in the industry. The question becomes, how will this impact the leader's role, our role, in the future?
It goes without saying that managers will have to be computer-literate to retain their jobs and must make sure they achieve the increased span of control that computers make possible. Management styles will change as executives learn to consult these skilled workers on a wide variety of issues. Employees will gain new power with the authority to make decisions based on the data they develop and the data they access.
Today and tomorrow, there will be fewer managers to report to and fewer decisions that require their input. Workers will be empowered to make decisions, the question is - which ones? And the question for us, as leaders, is and will be: are we ready for this?
Because I'm not talking about the old-style of so called 'delegation of authority.' I'm speaking of a world where perfect information is available to everyone all of the time. A world where the availability of this perfect information significantly impacts the role that leaders and managers have fulfilled for years. The role of having to gather the right information for people to perform their jobs, the role of parceling out information to employees, the role of controlling who gets what information... and finally the role of interpreting and passing on information from upper leadership. Those roles do not exist in this new scenario.
Technology will be pervasive. Our homes, offices, and everyday objects will become networked and intelligent. Computers become part of the environment, rather than tools. Programmable currency will shape our buying and selling patterns. As leaders, are we ready to embrace and capitalize on the opportunities presented by new technology?
How will we bring teams and technology - these two changing areas - together to achieve greatness?
Sometimes it helps to share an example. We each have examples everyday in our workplaces. The one I often like to share on how powerful teams operate in our "connected' world is: The International Space Station. The International Space Station is the largest and most complex space venture ever undertaken. Think about this: 16 countries, each with its own tools and parts, assembling a structure as large as a 777 while it's flying almost 200 miles above the Earth at 26,000 miles per hour.
This journey is made possible not through the efforts of any single space agency, not through a single nation, and not through any single company, but through the strength and common purpose of a team on the highest level. The International Space Station is a powerful symbol -- our symbol -- of what members of a great team can accomplish by using the tools of technology and team collaboration. It is a symbol of the tremendous possibilities open to us during this new millennium.
As I have said, the evolving role of teams and technology affects our role as leaders. Let's talk about how we respond, as leaders, to these factors.
Today's leaders must create shared ownership throughout the enterprise in a way that is creative and focused. Everyone on the team -- including customers and suppliers - must be attuned to the team's mission in order to create the most value for everyone. This bit about everyone understanding the mission may sound basic, but it's really, really important. It's important because everyone basically wants to do a good job.
In order to do a good job, the team needs to know what the expectations are, what the deliverables are, and how what they are doing fits into the bigger picture.
It's critical for leaders to be able to help everyone understand the mission. This is a big change -- it used to be that leaders told individual people what their individual job was, and people seldom got to see the big picture. It can't be that way anymore.
Leaders need to remove bureaucracy, making way for teams to be more flexible and adaptable to change. This too may sound really basic, but think about it. It is the opposite of what leaders used to do. Leaders used to enforce the bureaucracy; now they need to eliminate it.
The people doing the work must be trusted and empowered. They need to be able to make decisions and see results immediately. People need to know that they can make mid-course corrections and see mid-course improvements. This helps the team - and the project -move swiftly toward its goal, the goal that everyone understands.
Leaders need to involve more people. The old adage of "if you want it done right, you have to do it yourself" doesn't fit in today's workplace. Everyone contributes to the smooth operation of the organization. If you can't work together, then prepare to be surpassed.
Leaders need to link people to each other and each other's ideas. Here is where technology comes in and plays an important role. At Boeing our objective is instant access to information by anyone in the global enterprise from anywhere. E-enabling the work environment is one way to bring people closer together, to connect their ideas. E-enabling and virtual office tools break down the barriers created by geography, by language, by time. This is a big change for leadership.
Remember, in the past it was the leader's role to bring information to people. Information was power, and the leader had all the information -- and power.
Today, the leader doesn't bring information to the team, but enables the team to access information -- sharing the so-called power. Basically, the leader needs to make information available to people on teams and those on the frontline. These people make the day-to-day decisions and take actions that affect our business, our customers, and our suppliers. These people know what to do.
The leaders of today and tomorrow will serve not as information barriers but as information facilitators, keeping the flow of information going up and down and sideways, and across barriers.
And yet, leaders must know when to make decisions and help their teams in the decision-making process. Again, decision-making should be moved to the people who are closest to the issues, and decisions are best when diverse opinions are sought and considered. But business is not a democracy. Even effective teams can stall-out and lose valuable time striving for consensus in every possible decision. Leaders must set the expectations of how and when decisions will be made. And in some cases, leaders must step in and make tough, unpopular decisions -- after having listened to input from the team.
Our role is changing. How will we allow information to flow to the front line where good decisions can be made? I challenge all of us to look for opportunities to make sure employees who need information get it and can act on it.
Leaders used to never want to lose a high performer from their teams; now good leaders encourage movement and rotations. It's all about sharing ideas, sharing talent, sharing creativity, and enhancing teams. And, by the way, talented people expect to have 'options and choices' for opportunities around the company.
Many employees ask me whether we encourage people to move across business units, geography and functions. The answer is: YES! Employees can stay in a particular functional area and move to a new business. Or, employees can change their career paths and move to a new function. And, we have all of the tools within Boeing to help make this happen. Our people have options and choices to change careers, business units or geography. Our jobs@boeing process makes jobs visible to all employees. Our tuition reimbursement programs help people hone skills in their chosen field or help them change fields. It's important that we as leaders help people move around the company.
So to sum up these thoughts on leadership, our workforce is continually evolving - and good leaders should empower that evolution. And good leaders need to evolve as well. Teams and technology impact our role; and should be embraced to take us to the future.
We as leaders must keep evolving. We need to think of ourselves in new ways. We'll be tested in new ways. We'll lead and team in new ways. And we will relate to customers and partners in new ways. We will forge new alliances and networks, and our ability to team and to work well together on teams will be crucial to our success -- and to our company's success.
Companies and organizations that "get it" will be the companies and organizations that thrive -- and profit.
Great places to work are also organizations with great financial performance. The top 100 companies on the Fortune "Best Companies to work For in America" out-perform the S&P 500.
Remember what I said earlier:
"Great leadership and involvement by all = good business." It's not one versus the other.
We are the leaders of Boeing. We lead by creating a productive work environment and by dreaming about things that have never before been done before and then by doing them.
Joe Jaworski of MIT states:
"Leadership is discovering the company's destiny and having the courage to follow it... Companies that endure have a noble purpose."
Boeing will endure as a great company, a great place to work and a great brand because of the strengths and capabilities of our great people. Our work has a noble purpose - to "connect and protect" people around the world... and to explore and open new frontiers on earth and in space.
Our future depends upon courageous leadership. We need leaders who are willing to adapt and learn as we move into the future. I am confident that you, our leaders, will be key to our shared success. We are counting on you.
Thank you for having me here this evening. It has been a tremendous pleasure.