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By Cynthia Silvia, DHA
Faculty Member, School of Business, American Public University
Higher Ambition leaders deliver extraordinary performance and social service, even when other businesses experience tough times. That’s because they focus on the business model and their employees focus on a shared goal.
These employees often have a strong emotional commitment to the organization; they work, trust and respect one another. It is this long-term commitment and trust that aid an organization in delivering greater economic value over a sustained period of time.
With greater economic value comes improved financial performance which, in turn, spurs the organization to achieve goals that are greater than expected. This model of Higher Ambition leadership and this culture, along with a good geographic footprint (the physical location of your business), is what pushes an organization to succeed.
Having the right leadership along with the right geographical footprint or location can have a major impact on store sales, income and expenses. It also affects whether or not a company is operating legally. It is essential to match the community’s style and values to that of the leadership and business, as both of these factors play a significant role in the success of a company.
Higher Ambition Leadership from a Historical Perspective
The concept of High Commitment High Performance (HCHP) goes as far back as 50 years. The main focus of the HCHP organization centers less on a bureaucratic operating system and more on the human-centric side of the business, where performance is based on employee engagement and commitment at all levels of the organization.
In 1984, Doctor Michael Beer of the Harvard Business School and his colleagues set the framework for Higher Ambition leadership in their book, “Managing Human Assets.” Beer, along with his cowriters Bert Spector, Paul Lawrence and D.Q. Mills, developed the HCHP concept into what would later become the theory of Higher Ambition leadership.
In 2011, Beer and other Harvard scholars Nathaniel Foote, Tobias Fredberg, Flemming Norrgren and Russell Eisenstat wrote the book “Higher Ambition: How Great Leaders Create Economic and Social Value” during which time they created the Theory of Higher Ambition Leadership. In this book, the authors interview 32 CEOs who believed in operating a business with a human-centric philosophy, so they could build a company with sustained competitive advantage over time. These Higher Ambition leaders believed in the importance of delivering exceptional economic and social value within their organizations and communities.
Higher Ambition Leaders Create Value, Purpose and High Performance
The traditional school of business believes that the goal of any business is to create value for its shareholders. However, Higher Ambition leaders believe that the purpose of any business should be to create value for all stakeholders, not just shareholders.
Michael Beer says Higher Ambition leaders strive to create inspiration, motivation and an emotional commitment in business, the community and society. Higher Ambition leaders believe that teamwork and collaborative practice are critical components of business success.
A key characteristic of high-commitment, high-performance organizations is that their Higher Ambition leaders are held accountable to their associates and to the other managers in the organization.
Most organizations are numbers-driven, which is the main focus of a traditional organization’s strategic identity. The target of Higher Ambition leaders, however, is to create economic and social value. It is this distinctiveness that forms the unique strategy typical of these high-performance organizations.
Winning at the marketplace and at all organizational levels gives the company a high degree of sustainability. By creating a “family” concept and a shared sense of identity among the organization, its members and the community, Higher Ambition leaders can promote a cooperative spirit in their communities and establish a community culture.
Building a Strategic Vision and Identity
Beer writes in his 2009 book, “High Commitment High Performance: How to Build A Resilient Organization for Sustained Advantage,” that High Ambition leaders create a strategic vision of the company’s heritage along with assets based on the company’s culture, organization and social actions.
Employees who work for such leaders are highly committed and capable of achieving company goals. Employee teams often share a common goal and purpose along with a high degree of trust, respect and emotional commitment. As a result, they deliver a high economic value that leads to improved performance.
By sustaining a competitive advantage, High Ambition leaders promote the unique characteristics, capabilities and strengths that their companies become known for. In doing so, they create a strategic identity.
Standard Chartered Bank: A Classic Example of Higher Ambition Leadership
British multinational banking and financial institution Standard Chartered Bank is an example of what a company headed by a Higher Ambition leader can do.
In celebration of the bank’s 150th anniversary in 2012, CEO Mervyn Davies launched the “Seeing is Believing” campaign, which collected funds to prevent blindness throughout the world. Davies challenged all employees to raise enough money to save the eyesight of 28,000 people, one for each bank employee.
During the first year, bank employees exceeded that goal, raising enough money to save the eyesight of 56,000 people. Davies then upped the goal to a million people over three years. Within 10 years, the bank had restored the eyesight of 2.5 million people and provided preventive care to 7.5 million people.
The impact of the “Seeing is Believing” campaign extended beyond corporate social responsibility. The campaign showed investors that as a company, Standard Chartered could make an impact worldwide.
The campaign also set new goals for reinventing Standard Chartered. These goals set the bank on a course that would create value and ultimately turn Standard Chartered into a highly profitable entity for all stakeholders.
Davies is an example of what a Higher Ambition leader can do. The mutual respect that he engendered permitted the organization to focus on diversity and resolving conflict in a productive way. Amazing insight occurs when corporate culture and strategy are reshaped to allow for success.
Restructuring to Create Value
Leif Johansson was hired as the CEO of Volvo in 1997. Less than two years after taking the helm, Johansson sold the car division to Ford. That was the beginning of his 10-year effort to transform Volvo’s commercial vehicle division into a world-class manufacturer of trucks.
Johansson restructured Volvo by buying Renault’s trucking business and the U.S.-based Mack Trucks. After breaking up Renault, Mack and Volvo trucks, he formed a power-train division that focused on purchasing, product planning and product.
This strategy permitted Volvo to reduce the number of engine platforms to two and make it possible for Volvo to invest in other acquisitions, such as Nissan Diesel trucks. The takeover allowed Volvo to create a worldwide culture that permitted the company to continue to make acquisitions and forge new partnerships.
Johansson succeeded in crafting a winning strategy for Volvo. It set a clear focus on the need for Volvo to be a social institution that promotes a clear vision, social responsibility and a shared community culture.
Courage and Determination: Key Attributes of a Higher Ambition Leader
Being a Higher Ambition leader takes courage and determination to make an organization profitable and successful.
Higher Ambition leaders build collaborative leadership into their organizations. They focus largely on the team and the company, not on themselves. These leaders understand that for a company to be successful, it must focus on high standards, principles and values, in addition to exceptional management skills.
Higher Ambition leadership requires more than incentives to keep an organization running. Associates must be at ease working with others in a non-traditional setting.
In a non-traditional setting, Higher Ambition leadership takes a hard look at matching consumer expectations to that of the business. Adopting a consumer-centric approach along with empowering associates to build relationships, overcome business deficiencies and make decisions that take into consideration the needs of the consumer will keep the customers coming back again and again.
Associates must also accept different points of view, and a variety of working techniques and cultures. They must also have the ability to build relationships and overcome deficiencies. Senior leaders must be able to change the traditional mindset to realize the company’s vision of creating a Higher Ambition organization.
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About the Author
Cynthia Silvia, DHA, is a faculty member for the School of Business at APU. She is also a member of the faculty at Sacred Heart University in Connecticut. Dr. Silvia received a Bachelor of Arts and a Master of Arts in Elementary Education from the University of Rhode Island, a Masters in Healthcare Administration and a Doctorate in Healthcare Administration from the University of Phoenix. She has been teaching at the university level both online and on campus for the past three years.
Additionally, Dr. Silvia has held various retail management positions over the past 36 years for F.W.Woolworth/Woolco, Bradlees, Ames, Sears, Toys “R” Us and Babies “R” Us. She currently works for CVS Pharmacy.