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Nancy Koehn

Nancy Koehn

Nancy F. Koehn is a historian at the Harvard Business School and author, most recently, of The Story of American Business: From the Pages of the New York Times.

Zuckerberg's expensive lesson

Q: Facebook's young founder Mark Zuckerberg avoids press interviews, offers inscrutable answers at public forums and jealously guards his privacy--so much so that he is now the subject of an unflattering movie. Does Zuckerberg have to develop a better "outside game" to be an effective leader of his fast-growing company?

Developing a good "outside game" is an expensive lesson for many leaders.

It usually demands opening the curtains on one's motivations, commitment and other aspects of one's path that fall outside delivering on the metrics of the business model and the latest strategic plan. (Indeed, learning this lesson may ask a leader to thoughtfully let down his or her guard on their own privacy.) It requires ongoing respect for the winds of public sentiment whipping across the landscape and a canny understanding of what the (ever-changing) media is up to. Even more costly, it asks that leaders like Mark Zuckerberg--who have built their success developing what they believe is a unique and superior offering--take a deep yoga breath and really listen to the masses of people, including competitors, that are affected by the very fruits of that entrepreneurial endeavor. Last and perhaps most expensive, it requires a leader to respond credibly to that feedback. And to keep on responding--strategically, intelligently, carefully and in good faith--on an ongoing basis.

Who wants to take on such an undertaking when there are not enough hours in the day to manage a company, build a market and deliver on the organization's promise to customers, employees and shareholders? (One can almost hear executives of different stripes and spots asking themselves this under their breath.) But this is not the relevant question. The key question is: which leader can afford not to develop a good outside game? And at this moment in history, the answer is no one.

In our age of 24/7 connectivity and the growing democratization of information distribution, leaders and organizations of all kinds are increasingly operating in glass houses. The explosion in transparency wrought by a global media, great leaps in connectivity, and a generation of global citizens who demand novel commitments from business is creating new standards of disclosure and conduct for even those actors least willing to change.

As important, rising customer confidence and power are providing billions of people with the ability to respond quickly and effectively to all kinds of factors other than the value proposition put forth by a given company (Think Wal-Mart six years ago, when all manner of issues other than "everyday low prices" were affecting sales, employee motivation, and even real-estate acquisition.) The "outside game," including the unspoken commitments and values of a given executive and organization, have become part and parcel of consumers' value proposition. So a leader ignores this game at his or her company's own peril.

Finally, though less obviously, there is a palpable thirst among people around the world for leadership that is not for sale; for individuals and organizations that are not solely defined by the transactional rhythms and white-hot speed of the marketplace. (My graduating MBA students talk of this concern frequently as they discuss job choices and sketch out their own career plans.) We can see this in the enduring popularity of entrepreneurial leaders such as Warren Buffett, Oprah Winfrey and Bono, individuals who have thrived in their respective industries partly because they consistently pursued something more then the next market-dictated score and have developed effective outside games to communicate this aspect of their leadership.

Right now, Zuckerberg's (often inscrutable) public persona, Facebook's complicated, controversial history on privacy issues, and the movie "The Social Network" are conspiring to lay down an important gauntlet for the young entrepreneur and his growing organization. Will he and his team access the humility and foresight to develop an effective outside game and commit themselves to playing it? Or will they choose to race on in pursuit of (even greater) market dominance and ignore this big glove on the ground? The latter course was that which John Rockefeller chose in building Standard Oil more than a century ago. And while, for a time, it served his market-share numbers (and bank account) well, it resulted in Standard Oil being broken up and in John Rockefeller being vilified. This was a very expensive lesson for the once-zealous entrepreneur to learn. Much more expensive than learning how to develop a good outside game.

By Nancy Koehn

 |  October 6, 2010; 2:00 PM ET
Category:  Accomplishing Goals , CEOs , Corporate leadership , Leadership personalities , Leadership weaknesses Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
Previous: Zuckerberg rightly focuses on his 'inside game' | Next: Matching 'outside game' to 'inside self'


Please report offensive comments below.

It's ironic that someone who is so flippant about the privacy of others so "jealously guards" his own.

Posted by: BurgundyNGold | October 7, 2010 8:59 AM
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