It’s cliché to say that the Chinese symbol for crisis is the same as the one for opportunity. It’s not exactly true, either. But it’s still a worthy sentiment, especially for business leaders.
Entrepreneurship, risky as it is, isn’t about surviving. It’s about thriving—doing big, bold things that lead to incredible breakthroughs. How do you lead that change? Take a class.
Former Charles Schwab CEO Dave Pottruck, now the chairman of HighTower Advisors, a $25 billion wealth management firm he launched in 2008, teaches a class on leading transformative change at the Wharton School’s Center for Leadership and Change Management. A senior fellow and adjunct faculty member, Pottruck has received multiple outstanding teaching awards from executive MBA students for his class, which he began teaching nearly a decade ago at the San Francisco campus.
“Over that time I’ve seen that students are hungry for this perspective,” Pottruck says. “There’s so much bold, breakthrough change that is needed—and is happening—in the world. But it often happens, sadly, unsuccessfully. And the breakdowns are not because the ideas are bad, but because the implementation is flawed.”
Pottruck’s class (and his brand-new book based on the class) is intended as a step-by-step guide to confronting challenges and lead a business through them into glorious new frontiers. Stacking the Deck: How to Lead Breakthrough Change Against Any Odds is Pottruck’s second book, following the Wall Street Journal best-seller Clicks and Mortar, which he co-authored in 2000 with Terry Pearce.
The book includes perspective and insights from Pottruck’s interviews with transformative leaders from such companies as Starbucks, eBay, Intel and Wells Fargo. Pottruck compiles a nine-step plan to create breakthroughs, plus three more chapters on adapting the philosophy to real world situations, communicating a leadership vision and additional thoughts on driving innovation.
Step 1: As a leader, you have to establish the need for change and create a sense of urgency within your organization. Only when the entire team is on board can progress finally occur. “Oftentimes the need to change stares you in the face, but usually in that situation, you’re late,” Pottruck says. “You need to find the need to change in the tea leaves. You need to be able to look ahead, down the road.”
At Charles Schwab from 1984 to 2004, Pottruck did just that by guiding the transition from pricey trades by telephone involving brick-and-mortar brokerages toward an Internet-trading business model. After the firm’s leadership team was convinced of the need for such a move, and the financial hit that would come with it, the next step was to rally the troops. “We had to really go out and sell this to the field,” Pottruck says. “The people in the Schwab branches were very threatened…. They said, ‘why would I want people to do these things online? My job could go away if they stop coming in here and asking for my help.’ I had to explain that there will always be a need for face-to-face communication, because we’re in the business of trust. And it’s hard to develop trust over the Internet, or confidence about what’s happening to your money.”
While the company rebuilt its profitability during the transition to its new business model, Pottruck followed the rest of his steps to breakthrough change, building momentum by celebrating wins along the way, defining the metrics of the move’s success, and continuing to work with his huge team across the country. He fleshes out a path to each step in the new book.
“When I talk about leading breakthrough change, the whole formula is leadership skills and communications, plus a step-by-step process that will build momentum, and talent and people—the team that you have,” Pottruck says. “It’s those three things. You can’t have two. You’ve got to have all three. And even if you have three, there’s no guarantee that you’re going to succeed. But if you have those three things, you have a darn good chance of being successful.”