Building Global Leadership Capacity – My week in Brazil

SONY DSC

Today’s leaders are global and leadership development has to take into account and bring to life this global dimension.  As part of the Philips Octagon leadership development program, I spent a week in Sao Paolo, Brazil as part of a year-long program preparing the company’s top leadership.

SONY DSC

26 leaders from the company from all corners of the world (Australia, Brazil, China, India, Netherlands, Germany, USA) came together in Sao Paolo for the second week of the program.

Day 1

The best way of learning is learning by doing – and Philips has one of the best programs I have seen in this regard.  The leaders work on a project together.  The results are presented at the end of the program to the CEO, CFO and head of HR of Philips.  Project presentations in the past  have developed into real businesses.  For the project members themselves, these project presentations can have significant career implications.

There could hardly be a more global approach than the 4 projects being prepared this year: Lighting Strategy in Brazil, Expansion of Oral Healthcare Products and Services, Domestic Appliances in Africa, and Home Health Service in India.  In addition, each of the teams is global in its composition.

Participants spent most of the day working on their project ideas, taking advantage of being physically in the same place at the same time and not having conflicting matters to attend to.

Day 2

Today featured a field trip into Sao Paolo to better understand the local market conditions in this fascinating fast developing economy.  The field trip was well organized by local Brazilian Philips staff.  It included visits to retail establishments, discussions with store managers, directors of hospitals and most memorable of all for me was a visit to an average Brazilian household.  Local Brazilians opened up their homes (receiving credits for Philips products in return) to the Octagon participants.  The purpose of such visits was to get an insight into the “typical” consumer.

SONY DSC

Having grown up in Mexico, the environment that we visited was certainly not foreign to me.  Nevertheless, having lived in Germany for a couple of decades the exposure to this kind of reality is always eye-opening.  We visited a family with 5 daughters living in a space which at best was 80 m².  The family was extraordinarily gracious and from the looks of it, living a contented and rich existence.  Despite modest means, they had a plethora of appliances, including a microwave, blender and fully equiped kitchen.  We asked the wife what was the most valuable piece of equipment they owned and were surprised by the answer – a rice cooker (saves a lot of time!).

SONY DSC

SONY DSC

Spent the rest of the day reflecting on the learnings from the day’s visit.

Day 3

The inauguration of the new 360° instrument Global 6 (see my blog from Jan 26 and  Feb 2).  Octagon leaders got direct feedback from bosses, direct reports and peers on how their leadership style works or does not work in a global context.

We also included an interactive group activity – The International Trading Game.  The purpose of the game was to show how barriers and boundaries create difficulties in creating genuine collaboration.  Everyone cognitively understands the benefits of collaboration, but when put to the test, competitive, non-collaborative behaviors automatically come to the fore.  For the Octagon participants this was no exception.  We need to be constantly reminded how difficult collaboration is to achieve.

SONY DSC

Much of the rest of the day was spent looking at leadership tools to enhance collaboration including aspects of influence tactics and political savvy.

Day 4

Spent mostly with local Philips Brazilian managers discussing what has been learnt so far and learning more about the local Philips businesses.

One of the highlights of the day was a presentation by an external speaker – an entrepreneur who has started an online distribution business selling baby products in Brazil.  This presentation led to a lively debate about how to incorporate elements of entrepreneurship into Philips.

Day 5

Wharton professor David Wessels looked at project finance as an input for the project teams.  The teams then proceeded to present the current state of their projects.  Final presentations will be in Amsterdam in May.  Stay tuned…

 

SONY DSC

“Success is no accident. It is hard work, perseverance, learning, studying, sacrifice and most of all, love of what you are doing or learning to do.”        Pele

3rd Industrial Revolution and Leadership

Let me start 2013 with a macro view of leadership…

I was in Philadelphia last year as part of the delivery team for one of the acknowledged top leadership development programs in the world – the Philips Octogon program.  It is a program involving 32 selected top performers at Philips.   The program takes place over 8 months in three locations.  The first session was at the Wharton School of Business.

steinberg center

Steinberg Conference Center – Wharton School of Business

Of course I felt quite comfortable coming back to this location.  Back in the 1980s I obtained my MBA at Wharton – one of the more prestigious business schools in the world.

I had the privilege to be able to listen to a presentation by Jeremy Rifkin on the first day of the program.  Mr. Rifkin established the Foundation on Economic Trends (FOET) .  Among many of his activities, he is a valued advisor of heads of state in Europe (including Angela Merkel) and has had very direct impact on European economic policy.  He is the author of the concept of the 3rd Industrial Revolution which is a road map for long-term economic sustainability.  This concept was formally endorsed by the European parliament in 2007.

This concept has fundamental implications for leadership in the 21st century.

His talk began pessimistically enough.  We are in the end phases of the Second Industrial Revolution and the only way out of this dead end is to completely change the fundamental infrastructure on which our current civilization is based.

Each industrial age is characterized by two fundamentals: energy and information.  Mastering a new energy process provides the means to create a new form of information dissemination.  The First Industrial Revolution centered around coal-fired steam-driven power generation.  This new energy regime also enabled the advent of mass produced newspapers and magazines based on steam-powered rotary press and linotype technologies.

The Second Industrial Revolution began with the advent of the internal combustion engine powered by fossil fuels.  This revolution was complimented by a communication revolution based on the creation of an electric grid infrastructure which eventually led to telephone, radio and television.

This Second Industrial Revolution is reaching its limits according to Rifkin.  The most important recent economic occurrence in the past five years is not the financial crisis of 2008, but the rise of oil prices to over 140$ a barrel in 2007.  This rise in the price of oil represents a major threat to the welfare of human society on the planet.  So many of current modern materials are based on fossil fuels (from plastics to fertilizer), that this price has seismic implications for the economy.  Rifkin concludes that the current economy is doomed to limited growth for decades to come.  Every time the price of oil goes over 120 $ a barrel, a new global recession is virtually assured.  The problem is not the amount of fossil fuel available.  There are still plenty of reserves.  The problem is that getting at those reserves is becoming more costly over time.  This limit threatens ALL economies including emerging economies such as China and Brazil.   It is a global phenomenon.

What is the way out?  What are the implications for leadership?  Stay tuned for more….

“One thing I have learned over these last 30 to 40 years is that people make history.  There is no fait accompli in any of this.”         Jeremy Rifkin

Leadership Strategy at Philips

This past week I was in Amsterdam.  I had the privilege of being part of one of the longest running leadership development programs that I am aware of – the Philips Octagon program.  This leadership program has been running for more than 30 years. In 2011, the program received an excellence in practice award from the European Foundation for Management Development (EFMD).

The program combines the development of both business and leadership skills.  Participants are top leadership prospects at Philips.  During the 3 module – 3 continent program, participants prepare new business proposals which are presented to members of the Philips board .  In the past many of these proposals have been the inspiration for the launch of new businesses at Philips.

The current group of 24 top leadership prospects was finishing its program in Amsterdam after previous sessions in Philadelphia and Moscow.  On Wednesday morning, the group had the opportunity to listen to the Philips CEO, Frans van Houten.  The focus of his talk was on leadership and organizational culture.

I spoke to the group immediately after the session with Frans van Houten on the topic of leadership strategy.  Managers of companies throughout the world are well trained to put together business strategies.  They know how to analyze market and product opportunities.  They can put together project plans, calculate costs and estimate returns on investment.  This is all part of normal business practice.  But does anyone know how to put a leadership strategy together?

Leadership strategy has many components.  First is the issue of capacity.  Is the leadership in place to actually implement the foreseen business strategy.  Very often great plans fail, because that capability is not in place.  A second aspect of leadership strategy has to do with mental mindsets.  If you are proposing something new, very often the new way will require a new mindset.  For example, if as a manufacturer you are used to only delivering hardware, a shift to a a service mentality – where most of the profit comes from the comprehensive services provided with the hardware – can prove to be a major challenge.  Finally there is the issue of individual leadership. This is where leaders look into the mirror.  In leading this change, do I have the passion, skills and resilience to make this happen?

I asked the 24 Octagon participants if they had ever put a leadership strategy together for any of the business plans that they had crafted.  The answer was as expected.  None of them had ever done so.  Yet if the success of a business proposition is so dependent on having the right leadership in place, why is this not part of normal business practice?

“Leadership is the ability to do, not the ability to state”  Paul von Ringelheim – sculptor