Level-Five Leadership

What makes some companies go from good to great? Jim Collins and his research team examined 30 years of data from over a thousand companies and identified factors that contributed to outsized market performance, including one they termed level-five leadership.

Leadership ability ranges from highly capable individuals at level one to contributing team members, competent managers, effective leaders, and finally, the fifth and final level, effective executives. Being a full-fledged level-five leader requires the capabilities of all the lower levels, such as the level-four ability to both improve company performance and paint a clear and compelling vision, but level-five leaders have something special that separates them from the rest, namely the rare combination of fierce resolve and personal humility.

When faced with setbacks, they look in the mirror, blaming themselves for underperformance, never external factors or bad luck. When their companies succeed, however, the mirror turns into a window and they give credit to others. The funny thing is this does not reflect reality. According to the research, the level-five leaders were responsible for their company's success, but they would never admit it. In fact, although they're very ambitious, level-five leaders rarely talk about themselves. Instead, they channel their ambition into something bigger than personal achievement.

To grasp this concept, consider US president Abraham Lincoln, a reserved, even shy leader who nonetheless held the country together during the Civil War. Despite monumental losses on both sides, his resolute determination to unify the country resulted in the reunited nation becoming a world power.

It might be a stretch to compare a great CEO to a president like Lincoln, but the level-five leaders in the study displayed the same kind of duality, modest yet willful, quiet yet fierce. If you're thinking that sounds like a rare combination of traits, you're right. Ironically, the drive that often propels people into level-four leadership stands at odds with the humility required to rise to level five, and too many companies reward extroverted style over substance.

To help your company go from good to great, seek out the fierce but humble leaders you may have overlooked.