With Baby Boomers retiring en masse, the next generation is stepping up to lead America’s companies, and Bill George, former CEO of Medtronic (and a Boomer), thinks it’s high time that torch was passed. “We need new leaders who know how to lead in crises—and to lead very differently than Baby Boomers,” says George. “We need leaders who know how to empower people and who lead with their hearts as well as their heads.”
That may not always come naturally to all GenX-ers or millennials, which is why George directs True North: Emerging Leaders Edition to that cohort. In the book, co-written with millennial entrepreneur Zach Clayton, George shares mistakes he and other CEOs have made, the lessons gleaned from them, and practical advice that he hopes will help the next generation of CEOs to lead with both passion and compassion. “These are difficult times and recent crises have really changed the attitudes [of employees]. We need leaders who are in touch with that.”
In the following interview with Chief Executive, George shares some of what he learned from his own struggles. To hear more, register for our live, virtual CEO Talent Summit on September 28th, where George and Clayton will be featured guest speakers.
You wrote that the hardest person you’ll ever have to lead is yourself. What did you mean by that?
Many leaders get caught up with external adulation and chasing money, fame and power because they really haven’t done their work to understand who they are. Before you can lead, you have to understand who you are and that means processing your life story, the difficult times you face, which we call crucibles, and gaining a high level of self awareness. Until you do those things. I don’t think you can be an effective leader. You take somebody like Mark Zuckerberg who hasn’t done that, and you see the pitfalls of when you don’t know clearly what your principles are, what your values are, what your boundaries are. Then you are more inclined to be a command-and-control style leader than you are to be a humanistic, empathetic and compassionate leader.
And then you start measuring yourself by your title, the money you’re worth, how many people are following you on Facebook or other things that really don’t matter in the long run. We’ve seen a number of leaders get caught up that way and they attract a lot of attention, like Elizabeth Holmes or Adam Neumann, and they really aren’t good leaders.
We’ve seen in recent years that people don’t leave companies, they leave bad managers. A lot of times, companies have not dealt with the jerks and the people that are out for themselves. Today’s employees, millennials, Gen Zs, will not work for somebody who it’s all about them, all about their egos. All real leaders have to support their people.
In the book, you shared some of your early crucibles, as you call them, including the unexpected death of first your mother, and then your fiancé. You wrote: “This was a crucial time in my life when I could have become bitter and depressed and even lost my faith.” But you didn’t. What do you think it was in you that kept you from losing your way?
First of all, I think it was having a faith and trying to recognize that there are things we don’t understand in life. Second is having people around me who supported me through that difficult time, without those friends who really cared about me personally, I wouldn’t have gotten through it. I could have gone off track and I’ve seen a lot of people do that and they go through very tough times.
You note how important it is as CEO to be surrounded by truth tellers and not sycophants and others telling you what you want to hear. When you were heading up Medtronic, how did you make sure you were getting the truth? That can be tough to suss out.
You’re absolutely right. I had at least three or four people at Medtronic who would just come in and tell it the way it is and sometimes I wouldn’t necessarily want to hear it—you know, telling me I didn’t do a good job in that meeting or somebody was upset with me or I was about ready to promote somebody but I hadn’t checked out their values and was making a mistake. So I knew who I could really trust because I established very close relationships with my subordinates—I think that’s critical. Having those relationships and really establishing more of a personal relationship with people, that it’s not just transactional, but more of a personal, long-term relationship.
And by the way, the truth telling is a two-way street. I have to be willing to tell other people the truth too, and share with them the difficulties we’re having and be very transparent with them about—like, ‘hey, I’m having a bad day today’ or ‘this is tough, you don’t realize some of the pressures I’m under.’ And then never punish anyone for speaking bad news. You compliment them you, you praise them, you reward them for bringing you bad news.
How did you reward those who brought you bad news?
I would let them know how I feel about it, how much I appreciate it. You don’t have to write out a check, but these are the people I give more assignments to, I share more with, give more responsibility to, and they may get promoted, too. It’s not necessarily quid pro quo, but those are the people I rely on.
Everyone in the organization wants to be relied on by the CEO and the people they perceive to have more power than they have or more responsibility. They want to feel included. One of the things I write about [in the book] is that it’s not about diversity in an organization—it’s about inclusion. Yes, we have to have diversity, but once we have that, we have to make everyone feel included, a sense of belonging and the way you do that is by sharing with people.
Do you think that CEOs should talk openly about their personal crucibles with employees?
With people that they have a relationship with, yes. I don’t think you just put it out on Twitter and say, ‘Here’s what happened to me.’ In this book I have been very open, but these are things that I’ve dealt with for many, many years. But you’ve got to make sure it’s not all about you. It’s about the people you work with.
We did see an example of that, a few weeks ago with Braden Wallake, the CEO of HyperSocial, who posted a video of himself crying over a layoff. The backlash was brutal—within a day, he had been dubbed the ‘crying CEO’ and called out for making it about himself.
Exactly. I think it was about him and not about the people. Maybe he should talk about, what is he gonna do to help these people who are being laid off? It’s nice to cry about it, but are you gonna help them find other jobs? Will you recommend them to other companies or other people? Are you gonna make a few phone calls on their behalf? And who’s gonna be laid off? Maybe they’re people who, instead of laying them off, you give them an early retirement package. There are a lot of things you can do, not just write pink slips.
I think they want to know you’re real and you really care, that it’s not just for show, what’s being called “purpose washing.” You can’t just sign on to say I think what happened to George Floyd was terrible. What are you gonna do about it in your company? And if you recognize the problems you can right within your own shop, you can say, ‘hey, we’re not where we thought we were, we’re way behind. That’s really critical.
Have you ever felt pulled away from your own “True North”?
I did. I felt pulled away when I was at Honeywell. My father had told me, ‘Son, you ought to run a major company.’ So I had that in the back of my mind, but deep down inside, I was really unhappy, trying to change my style and dress a different way and wear cufflinks and say all the right things. I really wasn’t myself, and everyone else could see it, but I couldn’t. One day I looked at myself in the mirror and recognized I wasn’t passionate about the business. I wasn’t excited about it. And I really had to rethink it. I told my wife this and she said, ‘Bill, I’ve been trying to tell you that for a year, you just refused to listen.’ So that’s when I decided to go to Medtronic.
Were you not aware of your own unhappiness until that day you looked in the mirror?
I was masking it. I’ve got a pretty good capacity to deal with very tough things, so I would say I was in denial about it and I wasn’t willing to admit it. And so then I had to realize, what’s it all about? Did I just want to chase numbers and lay people off at companies that weren’t investing in the future? No, I wanted to go to a smaller company. Medtronic was a mid-size company in those days—now it’s quite large $30 billion sales, but in those days, it was quite a bit smaller company.
You wrote that to accept all of yourself unconditionally, you must ‘directly confront your shadow side and learn to love your weaknesses.’ What is one weakness you’ve learned to love about yourself?
My impatience. Also, my lack of tact, being too direct, and sometimes intimidating people by asking challenging questions. So I’ve learned to modulate those things. And I recognize a lot of these weakness are two sides of the same coin—by challenging people, you get to the facts of the case. By being very direct, people know where they stand. By being impatient, you get a lot of things done now. I don’t wanna rationalize those because they’re not good characteristics, so I’ve tried to modulate those. I had a couple of decades of people trying to fix my weaknesses at prior companies and it never worked.
So we are who we are?
Yeah, but I think you can modulate it and minimize it and have a higher self-awareness when you’re impacting people, like if you’re shutting people down by asking challenging questions, for example.
You write about several high-profile CEO failures of the last decade-plus. It’s likely that at least some of them started with small, imperceptible lapses that became the slippery slope. What might a sign to a leader that he or she is veering away from their True North?
I think that is how it happens—you have minor ethical lapses and you start to accept it and you think you can get away with it, and then all of a sudden you find yourself way outside the circle of your True North. So having those truth tellers around you that are gonna tell you, ‘I don’t like what I see happening to you,’ and being open with people and sharing when you have a concern about an issue, getting more counsel and advice, that’s really helpful. You’ll make your own decisions, but bring more people in and they’ll point out to you what the risks are. That’s so important to have truth-tellers around you who can not only tell you the truth, but also, when they see you going off course, they’ll tell you.
I still regret not being able to do that for Rajat Gupta (the former head of McKinsey convicted of insider trading in 2012). We both sat on the Goldman Sachs board. He never shared much [on a personal level] and we’d get together professionally, not personally. He was getting way off track and I wish I had seen that and seen his need to try to become more wealthy and then do marginal things to get there—but I didn’t get to see it, so I wasn’t able to help, and I’ve always regretted that I wasn’t.
What mistake did you make in your career that you learned the most from?
I would say thinking that I had to run a large company and letting myself get caught in bureaucracy. When I was at Honeywell, I loved the company, I loved being president of Honeywell Europe, but then I got thrown into these turnarounds and that just wasn’t who I was. I knew how to do them, and other people didn’t wanna do them, so that meant laying a lot of people off. I know how to do that, but my heart wasn’t there. So not listening to my heart was the real shortcoming. When I finally did, I moved to Medtronic. Thank goodness I did.
You called yourself a believer in the ‘leader as coach’ model. What if you’re a CEO who’s really good at lots of things, but just not that great at coaching?
You better learn. Your people better know you care about them. You can’t just be a bully, or the smartest guy in the room. Millennials are not gonna respond to that kind of top-down directive style, so they will not respond. They won’t give you their hearts until they know you care about them. Many CEOs know how to organize people, but you’ve got to get people to what we call their sweet spot, to play to their strengths and their motivations. That’s critical.
And you need to get alignment. A lot of people come in and do jobs with different values and purposes. So how do you get that all aligned around a common purpose for the company?
You noted that crisis is the real test of leadership. What was one such crisis that proved to be a major test for you?
I’ve had tests all throughout my career. When I first started out with Litton Microwave back in 1970, as I was taking a new job to be general manager of the microwave oven division, the secretary of health and human services said microwave ovens may be dangerous to your health—so we had to deal a lot with crises there. And that prepared me later on for some of the crises at Medtronic to make sure we had a quality product. I had a lot of crises to deal with because it’s a challenging business and you have to make the right call. Missing the numbers, I don’t consider a big crisis. It happens—and then you bounce back.
One thing you didn’t really have to deal with as a CEO, but you’re watching it play out is the debate over flexible work. Some CEOs are digging in on in-person, while others are embracing remote. Which side do you think will win?
I think it’s gonna be a hybrid environment. The key is workplace flexibility and making sure that people feel they have the flexibility to work in the office or from home when they need to work there. I think it’s a little arrogant of people to say, ‘I’m never coming into the office’ because half of the workforce has to be on the job—they’re in factories or in labs, they’re in medical centers, like my son, who is a surgeon, so they have to be present. And I do think you need to be in the office because you learn so much more. So whether that’s three days a week or whatever it is, I think you need to be there. For most of us, that’s where you get mentored. That’s where creativity comes from. So I think you’ll see a steady migration back to the office, but people have the flexibility to work when they need to work to get their jobs done. And you recognize them as professionals. The eight-to-five or nine-to-five environment’s gone.