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Bossing around employees is so passé. Developing people, treating them with respect, encouraging their talents and input—these are trends that research has proven build strong companies and give them the competitive edge. Servant leadership—the philosophy of focusing first on the needs of employees and customers—has gained popularity in recent years, with numerous Fortune 500 firms like TDIndustries, Aflac and Synovus subscribing to its principles.
“If you really listen to your colleagues and figure out how to get them what they need, they will perform at a higher level, which improves the customer experience, which affects business results,” says Kent Keith, CEO of Greenleaf Center for Servant Leadership. The Indianapolis-based center promotes the teachings of Robert. K. Greenleaf, a retired AT&T executive who coined the term and founded the center in 1964. “The world is increasingly competitive, and the work required for companies to succeed is more knowledge-based and depends on employees being creative and making good judgments,” Keith says. “It makes sense to invest in growing employees in order to grow the capacity of a company.”
Jim Hunter, a servant leader consultant and the author of The Servant: A Simple Story About the True Essence of Leadership , adds that younger employees no longer hesitate to quit an unsatisfying job. “If you’re my boss and you don’t get what I need, I have no problem leaving and going to Google,” Hunter says.
The essence of servant leadership—serve the employees first, and success with clients will follow—might appear to be the antithesis of modern business. The roots of the philosophy are thousands of years old, with examples dating back to the 4th century B.C. in India and China, as well as in the New Testament and texts of Islam. In contemporary practice, it means actively listening to employees, treating them as people with needs, interests and failings, and respecting their roles in the company and the world.
Southwest Airlines’ former CEO Herb Kelleher believed that his company’s flight attendants were the airline’s most important leaders because they had the biggest impact on the customer experience. Those who have flown the airline know that Southwest flight attendants are some of the happiest people in the air. The corporate culture is often identified as an example of servant leadership, says Hunter, and the company is one of the industry’s most profitable. “The test of true leadership is whether employees leave the company better than when they got there,” Hunter says. “You want everyone growing and changing and improving. That is the only way your company will grow and change and improve.”
Unfortunately, the concept of servant leadership tends to evoke high-level philosophical meanderings with little practical application. However, advocates say, there are everyday habits leaders can incorporate into their management routines that can have powerful results.
►Listen. Pay attention to how you interact in face-to-face conversations, large groups and meetings, Keith advises. How do you communicate with your peers, subordinates, vendors and customers? How much do you really hear what they’re saying? Do you understand what they need? Find meaningful ways to invite employee feedback and suggestions, like peer evaluations or an idea box.
►Appreciate. “Instead of trying to catch people doing things wrong, shift your attitude to look for people doing things right,” Hunter says. Tell them about it both routinely—as in annual reviews—and spontaneously.
►Respect. Do you treat the assistant the same as the executive? The waiter the same as the banker? The leader sets the level of respect within the organization.
►Develop. Do you offer your employees the tools to become the best they can be? What do you provide in terms of training, new job development, book clubs or other personal growth tools? “The emphasis should be on coaching as opposed to controlling,” Keith says.
►Unleash. “People already have power and energy. They can use it or not use it,” Keith says. “How can you help them develop it?” Focus on decentralizing as many decisions as possible so employees can use the power of their experience to help the company. Those with direct customer contact should be involved in customer service policy making, and those in operations should have a say over those decisions. “Everyone is already showing up and getting paid. Why wouldn’t you want each one to make the biggest contribution he or she can make?” Keith asks.
Company: Festival Foods, a chain of 16 grocery stores headquartered in Onalaska, Wis.
Source: Chairman David Skogen
Servant philosophy: Remind more than instruct.
Evidence it works: Routine compliments from customers in awe of service, cleanliness and store experience
We recently received a letter from a customer complimenting an 18-year-old checker who nonchalantly asked the bagger to replace a quart of strawberries when he noticed a rotten berry while scanning the customer’s purchase. We get so many more of these letters since implementing servant leadership principles, which have helped us attract cream-of-the-crop employees—especially high school kids. Customers just can’t believe the experience they have in our stores. There is something special going on.
We’ve been in business for 55 years, and after we adopted a servant leadership philosophy 12 years ago—it wasn’t that there was a night-and-day difference—but there was a shift in our attitude from, “It’s a privilege to work for us and just be thankful you have a job,” to really earning our employees’ hearts and souls. They really want to work here.
One thing that is a big part of our culture is the huddle-up. Every morning, all the employees of each department—the bakery or deli or dairy—gather in front of their sections. We start with the previous day’s sales and how they compare with the previous year, what was different and what to expect going forward. The other part of the huddle-up is going around the horn and giving each person a chance to offer something. Some might make a suggestion for improving a process, or it might be more personal. One man recently asked for prayers for his father, who was having open heart surgery.
The huddle-up encourages buy-in to our successes and buy-in for problem solving. It also opens the lines of communication and creates an atmosphere of transparency and teamwork.
The CEO sets the tone for the business; it trickles down. If I’m in a store and see a grape juice spill, I stop and mop it up. I also set the tone in terms of addressing issues. Today, I am much less afraid to cause friction. It is good business for a manager to approach an associate and say, “Gee, Sally, you don’t seem to have the same bounce in your step as you had when I hired you. There seems to be a lot of backstabbing going on. Let’s talk about it.” That addresses the person as an individual and can open the door for resolving issues. But it also opens the door to help her find another position—either within our organization or by leaving. It is OK to say, “If you’re not enjoying your work in produce, maybe you should move to the deli or to bookkeeping.” And sometimes you have to say, “If things don’t improve, we love you and we will miss you, but this isn’t working out.”
We have to praise and discipline and hug. People think servant leadership means handing everyone a binder with principles in it, but it is a lot of hard work.
Company: Andy’s Burgers, Shakes & Fries, a 100-restaurant chain based in Mount Olive, N.C.
Source: CEO and founder Kenny Moore
Servant philosophy: Set the bar for character high, and treat employees with respect.
Evidence it works: Moore started Andy’s 20 years ago with $500. In 2010 revenue topped $50 million.
We rely on mostly young people to work for us, and I often get asked how we get them to care so much. I believe that at home and at school they are told how to act and what to do, but we believe they want to be respected by people of authority. We build relationships with them. We understand that prom is coming up, and if they want off on that night, that is fine. We even ask them to come by the restaurant, where we take their picture with their date and post it up in the store. Young people quickly learn that they are important, and they extend that respect to each other and to the customer.
But this kind of respect must come from the top. We have monthly managers’ meetings where we preach it; we drive home our culture and our values. I tell them things like, ‘Extend yourself to meet the needs of your employees, and see what comes back to you; it’s OK to love people; take time to get to know your employees—if they come in with a new hairstyle, compliment them on it.’
I’ve had several people in this company who had tremendous numbers, but they didn’t share our values and we had to get rid of them. One manager had the best numbers in the company but was threatening and pushing people around. I fretted over the decision to get rid of him, but letting him go didn’t change the numbers at that store.
I vet every potential franchisee, and if I don’t think they’re a good fit for our philosophy, I don’t care how good their financial statements are. I ask them about their personal philosophies, their ideas on leading young people. In a sour economy, those without strong values are going to fail.
Company: North Mississippi Health Services, based in Tupelo
Source: CEO John Heer
Servant philosophy: Identify and systematically correct one’s poorest leadership skills.
Evidence it works: Employee, doctor and patient satisfaction improved, and market share shot up.
I have a long background in servant leadership, and I came to this position in 2004 to help remedy a number of management issues. We worked with a consultant to make changes, and top executives all engaged in a process of reviewing ourselves and each other for leadership characteristics including humility, honesty, integrity and focus on results. Everyone got a feedback report that we shared with the rest of the group, and then we created an action plan to make changes for the lowest-scoring results, which we also shared.
My lowest scoring item was listening. My action plan was to keep a listening log in my office, and for six months, after every meeting, I asked the person I met with to fill out the log and comment on how well I listened. This included colleagues, vendors, people in the community, politicians—everyone. There were hundreds of entries.
With the CEO participating like this, it sends a really important message that it is OK to admit you have a problem and it is important to make a conscious effort to work on it. The process of asking for feedback and sharing my problem was embarrassing, but it was also very liberating. It allows you to drop the cloak of feigning a false personality. Everyone else already knows where you need to improve.
This process was so successful with our top executives that today 750 employees have gone through the process, including shift managers and charge nurses. We continue to rank them; the middle performers repeat the process every year, and the lowest performers continue on a six-month action plan.
Listening is the most common issue, but as a result of everyone’s improved listening skills, we’ve seen tangible changes. One example is “Ideas for Excellence,” an intranet program where employees submit suggestions on improving the way we do things. Employees usually run these ideas by their supervisors before submitting them, and the fact that managers are better listeners encourages more submissions. In three years, the number of submissions doubled to 12,000 ideas per year.
Since we’ve implemented servant leadership, we’ve seen all our metrics improve: Employee satisfaction rose from the 78th percentile to the 98th percentile; patient satisfaction rose from the 50th percentile to the low 90s; physician satisfaction grew from the 40th percentile to the 90th; and our financials and market share improved, too. I attribute 90 to 95 percent of these results to our changed philosophy.