Leadership 101

John C. Maxwell

• Publisher: HarperCollins Leadership
• Year: 2002
• ISBN:
  9781418535285
• Topic: Commerce
• Subtopic: Leadership

Unleash your leadership potential with this need-to-know guide, direct from the playbooks of America's most trusted leadership expert, John C. Maxwell.

No matter who you are, you can lead—and lead well.That is the message?New York Times?bestselling author John C. Maxwell gives in this power-packed guidebook

The consummate leader offers a succinct and inspiring framework for enhancing the leadership abilities you already possess.

In Leadership 101, Maxwell will teach you how to:

• Follow your vision and bring others with you
• Produce a lasting legacy
• Grow the loyalty of your followers
• Make continual investments in the quality of your leadership
• Increase your ability to influence others
• Determine your leadership "lid"
• Empower others through mentoring
• Create a foundation of trust
• Use self-discipline to improve your character—and your results

One of the keys to successful leadership is applying the concepts that have made other leaders strong. Here's your opportunity to do just that.

PART 1

THE DEVELOPMENT
OF A LEADER

I

WHY SHOULD I GROW AS A LEADER?

The higher the leadership,
the greater the effectiveness.

I often open my leadership conferences by explaining what I call the Law of the Lid because it helps people understand the value of leadership. If you can get a handle on this principle, you will see the incredible impact of leadership on every aspect of life. So here it is: Leadership ability is the lid that determines a person’s level of effectiveness. The lower an individual’s ability to lead, the lower the lid on his potential. The higher the leadership, the greater the effectiveness. To give you an example, if your leadership rates an 8, then your effectiveness can never be greater than a 7. If your leadership is only a 4, then your effectiveness will be no higher than a 3. Your leadership ability—for better or for worse—always determines your effectiveness and the potential impact of your organization.

Let me tell you a story that illustrates the Law of the Lid. In 1930, two young brothers named Dick and Maurice moved from New Hampshire to California in search of the American Dream. They had just gotten out of high school, and they saw few opportunities back home. So they headed straight for Hollywood where they eventually found jobs on a movie studio set.

After a while, their entrepreneurial spirit and interest in the entertainment industry prompted them to open a theater in Glendale, a town about five miles northeast of Hollywood. But despite all their efforts, the brothers just couldn’t make the business profitable, so they looked for a better business opportunity.

A NEW OPPORTUNITY

In 1937, the brothers opened a small drive-in restaurant in Pasadena, located just east of Glendale. As people in southern California became more dependent on their cars in the thirties, drive-in restaurants sprang up everywhere. Customers would drive into a parking lot around a small restaurant, place their orders with carhops, and receive their food on trays right in their cars. The food was served on china plates complete with glassware and metal utensils.

Dick and Maurice’s tiny drive-in restaurant was a great success, and in 1940, they moved the operation to San Bernardino, a working-class boomtown fifty miles east of Los Angeles. They built a larger facility and expanded their menu from hot dogs, fries, and shakes to include barbecued beef and pork sandwiches, hamburgers, and other items. Their business exploded. Annual sales reached $200,000, and the brothers found themselves splitting $50,000 in profits every year—a sum that put them in the town’s financial elite.

By 1948, their intuition told them that times were changing, so they made modifications to their restaurant business. They eliminated the carhops and started serving only walk-up customers. They reduced their menu and focused on selling hamburgers. They eliminated plates, glassware, and metal utensils, switching to paper products instead. They reduced their costs and the prices they charged customers. They also created what they called the Speedy Service System. Their kitchen became like an assembly line, where each person focused on service with speed. Their goal was to fill each customer’s order in thirty seconds or less. And they succeeded. By the mid-1950s, annual revenue hit $350,000, and by then, Dick and Maurice split net profits of about $100,000 each year.

Who were these brothers? On the front of their small restaurant hung a neon sign that said simply MCDONALD’S HAMBURGERS. Dick and Maurice McDonald had hit the great American jackpot, and the rest, as they say, is history, right? Wrong. The McDonalds never went any farther because their weak leadership put a lid on their ability to succeed.

THE STORY BEHIND THE STORY

It’s true that the McDonald brothers were financially secure. Theirs was one of the most profitable restaurant enterprises in the country, and their genius was in customer service and kitchen organization, which led to a new system of food and beverage service. In fact, their talent was so widely known in food service circles that people from all over the country wanted to learn more about their methods. At one point, they received as many as three hundred calls and letters every month. That led them to the idea of marketing the McDonald’s concept.

The idea of franchising restaurants had been around for several decades. To the McDonald brothers, it looked like a way to make money without having to open another restaurant themselves. In 1952, they tried it, but their effort was a dismal failure. The reason was simple: They lacked the leadership necessary to make it effective.

Dick and Maurice were good restaurant owners. They understood how to run a business, make their systems efficient, cut costs, and increase profits. They were efficient managers. But they were not leaders. Their thinking patterns clamped a lid down on what they could do and become. At the height of their success, Dick and Maurice found themselves smack-dab against the Law of the Lid.

THE BROTHERS PARTNER WITH A LEADER

In 1954, the brothers hooked up with a man named Ray Kroc who was a leader. Kroc had been running a small company he founded, which sold machines for making milk shakes. McDonald’s was one of his best customers, and as soon as he visited the store, he had a vision for its potential. In his mind he could see the restaurant going nationwide in hundreds of markets. He soon struck a deal with Dick and Maurice, and in 1955, he formed McDonald’s System, Inc. (later called the McDonald’s Corporation).

Kroc immediately bought the rights to a franchise so that he could use it as a model and prototype to sell other franchises. Then he began to assemble a team and build an organization to make McDonald’s a nationwide entity.

In the early years, Kroc sacrificed a lot. Though he was in his midfifties, he worked long hours just as he had when he first got started in business thirty years earlier. He eliminated many frills at home, including his country club membership, which he later said added ten strokes to his golf game. During his first eight years with McDonald’s, he took no salary. He also personally borrowed money from the bank and against his life insurance to help cover the salaries of a few key leaders he wanted on the team. His sacrifice and his leadership paid off. In 1961 for the sum of $2.7 million, Kroc bought the exclusive rights to McDonald’s from the brothers, and he proceeded to turn it into an American institution and global entity. The “lid” in the life and leadership of Ray Kroc was obviously much higher than that of his predecessors.

In the years that Dick and Maurice McDonald had attempted to franchise their food service system, they managed to sell the concept to just fifteen buyers, only ten of whom actually opened restaurants. On the other hand, the leadership lid in Ray Kroc’s life was sky high. Between 1955 and 1959, Kroc succeeded in opening 100 restaurants. Four years after that, there were 500 McDonald’s. Today the company has opened more than 21,000 restaurants in no fewer than 100 countries.¹ Leadership ability— or more specifically the lack of leadership ability—was the lid on the McDonald brothers’ effectiveness.

SUCCESS WITHOUT LEADERSHIP

I believe that success is within the reach of just about everyone. But I also believe that personal success without leadership ability brings only limited effectiveness. A person’s impact is only a fraction of what it could be with good leadership. The higher you want to climb, the more you need leadership. The greater the impact you want to make, the greater your influence needs to be. Whatever you will accomplish is restricted by your ability to lead others.

Let me give you a picture of what I mean. Let’s say that when it comes to success, you’re an 8 (on a scale from 1 to 10). That’s pretty good. I think it would be safe to say that the McDonald brothers were in that range. But let’s also say that your leadership ability is only a 1. Your level of effectiveness would look like this:

SUCCESS WITHOUT LEADERSHIP

To increase your level of effectiveness, you have a couple of choices. You could work very hard to increase your dedication to success and excellence—to work toward becoming a 10. It’s possible that you could make it to that level, though the law of diminishing returns says that your success will increase only to a certain point, after which, it fails to increase in proportion to the amount of work you put into it. In other words, the effort it would take to increase those last two points might take more energy than it did to achieve the first eight. If you really killed yourself, you might increase your success by that 25 percent.

But you have another option. Let’s say that instead you work hard to increase your level of leadership. Over the course of time, you develop yourself as a leader, and eventually, your leadership ability becomes, say, a 6. Visually, the results would look like the chart on the opposite page.

By raising your leadership ability—without increasing your success dedication at all—you can increase your original effectiveness by 500 percent! If you were to raise your leadership to 8, where it matched your success dedication, you would increase your effectiveness by 700 percent! Leadership has a multiplying effect. I’ve seen its impact over and over again in all kinds of businesses and nonprofit organizations. And that’s why I’ve taught leadership for more than twenty-five years.

SUCCESS WITH LEADERSHIP

TO CHANGE THE DIRECTION OF THE
ORGANIZATION, CHANGE THE LEADER

Leadership ability is always the lid on personal and organizational effectiveness. If the leadership is strong, the lid is high. But if it’s not, then the organization is limited. That’s why in times of trouble, organizations naturally look for new leadership. When the country is experiencing hard times, it elects a new president. When a church is floundering, it searches for a new senior pastor. When a sports team keeps losing, it looks for a new head coach. When a company is losing money, it hires a new CEO.

A few years ago, I met Don Stephenson, the chairman of Global Hospitality Resources, Inc., of San Diego, California, an international hospitality advisory and consulting firm. Over lunch, I asked him about his organization. Today he primarily does consulting, but back then his company took over the management of hotels and resorts that weren’t doing well financially. They oversaw many excellent facilities such as La Costa in southern California.

TO REACH THE HIGHEST LEVEL OF EFFECTIVENESS, YOU
HAVE TO RAISE THE LID OF LEADERSHIP ABILITY.

Don said that whenever they came into an organization to take it over, they always started by doing two things:
First, they trained all the staff to improve their level of service to the customers, and second, they fired the leader.
When he told me that, I was at first surprised.

“You always fire him?” I asked. “Every time?”

“That’s right. Every time,” he said.

“Don’t you talk to the person first—to check him out to see if he’s a good leader?” I said.

“No,” he answered. “If he’d been a good leader, the organization wouldn’t be in the mess it’s in.”

And I thought to myself, Of course. It’s the Law of the Lid. To reach the highest level of effectiveness, you have to raise the lid—one way or another.

The good news is that getting rid of the leader isn’t the only way. Just as I teach in conferences that there is a lid, I also teach that you can raise it.

2

HOW CAN I GROW AS A LEADER?

Leadership develops daily,
not in a day.

Becoming a leader is a lot like investing successfully in the stock market. If your hope is to make a fortune in a day, you’re not going to be successful. What matters most is what you do day by day over the long haul. My friend Tag Short maintains, “The secret of our success is found in our daily agenda.” If you contin...