Latest / To Your Success! Podcast / Episode 47: Stop Managing. Start Leading

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Episode 47: Stop Managing. Start Leading · To Your Success! Podcast

• Christer Johnsen: Warm welcome everyone to the To Your Success podcast. am Christer Johnsen and with me today is Elin Solheim. Hello Elin. Nice to be back in the studio, in our boat. Where we spend most of the time. Yes. Together. Yes. As always. Yes. Warm welcome to all our listeners as well. Today we're to talk about a subject that is really close to my heart. It the difference between being a manager and a leader. Yeah. It is to either manage your life or your business or to lead your life or your business. Yeah, because companies today are full of people managing tasks and so many professionals have the title manager but very few becomes really the leader. And you have worked with leadership for more than 20 years. So what is the real difference between a manager and a leader? Well, it's like an inflation in titles, know. Today it's more important to be a director and everyone is a director than a leader. For me, a leader is the hero. It's not the director. If you have a CEO and he or she is not a leader, they don't know what they do. So manager focuses on the processes, on having control, focuses on the tasks, reporting, short-term execution. That is what they focus on. A leader is direction, setting high goals, making fast decisions. focus on the people, not in an HR perspective, but that people actually develop themselves, that people move forward. And culture is an important part of leadership. ⁓ Peter Drucker said, culture eats strategy for breakfast. Management is strategy, leadership is culture. And without leadership there is no culture. Well, there is a culture where everything, where the goal is to stay the same. ⁓ One of the first things I learned when I started working in Nestlé was that we constantly have to change to stay the same. And that's so true. Right. And, and leader focus is also long-term progress. It is not each quarter. It is, it is long-term, right. And it is to make decisions. It must be allowed to make mistakes. It's more important to make. I always say that let's make 100 decisions every day. If one is wrong, we fix it. But it seems that people are more afraid of doing mistakes these days. It's more important not to do a mistake than to do something wrong. Right. Not only in companies, but still in in real life. Yeah. Right. So managers, they maintain the system. Leaders move the system forward. I remember Tim Cook. the CEO of Apple, he was asked, is it important to break the rules? He said, no, it's not. It is important to make the rules. That is leadership. That is true leadership for me. Because leaders move the system forward. When I was in charge of Elpho, we took the company from 500 million Swedish kronor to 1.2 billion in four years. was back, daddy was back. I started 2004. Right? So you can imagine it's like going from a million to two and a half million within in the money today. What did I do? I set a high goal. But the smartest guy, Stefan, my chairman, he wrote in my contract what I should do. So I had to accept the goal. Right? He said, Christy shall take the company from 500 to one million, no, to 500 million to one billion in five years with. maintain profitability or more and then we're gonna sell it or have an IPO go public with it. We did it in four years. Do you think you're a good leader then or a manager? ⁓ I have never liked administration and I think administration is very much management. That is one of the reasons why I didn't want to go up in higher in bigger organizations as well. Elfa was 800 people, Rotterfella was 150 people, because I like people. That is why I'm a mentor today. I love working with people. I love helping other people. And when you get into bigger organizations, it's so easy that you have rules to follow. is... One of my first clients, she was in IT consulting when I worked with her and they had a 15 pages PowerPoint slide telling what management was. And I said, they are so way off. They are so way off. You cannot use consulting techniques on leadership, right? So the simple contrast is that the manager asks, are tasks done? Leaders ask, where are we going and why? I can share one of my how I was leading my teams. Because as a CEO and president, I always said that my job is to make the team successful. I am the team leader. I am the coach. I own this team. We had monthly management meetings looking 50 % back on history, reporting so that we knew where we were. It's always important to keep track of that. How is sales? How is profitability? How is cash flow? How are people doing? And then we focus 50 % on the future. Then in addition to that, every second week I had about from one and a half hours to two hours meeting with each manager, each of the leaders in my team. And I said, these meetings are holy. I said, we don't change them unless we die or we are really sick. We don't move them and we close the door and we turn the cell phone on flight mode because for these two hours, I am yours. Meaning that my job now is to make sure that you reach your goals based on the business plan, your personal goals. And I want you to have the biggest bonus ever. We always had bonuses because and that is leadership So I helped them achieve their goals because I knew when the team of five six seven people when all of them reached their goals Then I would reach my goals and the company would reach them reach these goals Can I can I just ask a question about it? Because I think many of the people that I meet think of leadership that someone they can follow If you have a leader you follow yeah, but it's actually the other way around The guides you to follow your own goals and your own... you work with the person. mean, I guess that is why the transition for me into coaching and mentoring was easy because I always mentored people. But a leader goes in front, right? And then he takes care of his pack, takes care of his people, right? Take care of the group, make sure that people are happy. But you don't follow the leader. You listen to what the leaders say and then you... You think yourself, right? Yeah. Yeah. And that is to free up your mind. And that is the purpose too. I mean, when you just have made the system, it's so interesting. People make all these routines, right? And then they make all these rules that everyone should follow. And that's what's Mintzberg in. you I'm I studied Mintzberg organizational theory when I, when I took my masters and he has this example of a machine bureaucracy where rules are everything. And it's easy to replace people because what is the most important thing are the rules. And we don't need to have a thinking mind as in a person. just need people to follow the rules and more and more and more companies as they grow bigger and bigger and bigger. And now the being gets bigger, right? Because it's easy to buy, buy other companies and they grow because it's easy to lend money. It's easy to borrow money, right? Because it's a lot of money floating around. and they do all these leveraged buyouts and people get a lot of cash for the companies. And then they grow, grow, grow. And somehow the guys at the top have to feel that they have control. And that is then you create the systems, right? You see that at banks. In banks, right? They follow the rules. see that in big corporations, airline companies, have a wonderful experience with Scandinavian Airlines. now and our insurance companies since SAS canceled our flight and we think it was because of technical reasons. But we don't know because we haven't been told and then the insurance company says that we need to have a confirmation why it was canceled. For us, it's easy. We just don't want to work with those companies anymore. Right. Move on and let karma do the rest. And then they forget about the people. But leadership is about the people. Right. You have to understand that I never talked about my employees. I talked about our people, right? We had 800 people employed in Elfa. We didn't have an HR department. And if you are a manager today, think about that. We didn't have an HR department. And we took the company from 500 million to 1.2 billion in four years. And you see in a lot of organizations today, the HR department is very big. Yeah, and I don't understand that. Well, I understand why. Because it's an excuse for all the managers that don't dare to be a leader. Right? And then they hire people and they don't want to fix it. And when people don't perform, they say to HR, I think you need to take care of this. I told my people that you are a leader. That means that you hire if it works great and then you make it better. If it doesn't work, it's your problem. I will support you, but you have to grab the shit and tell the person. Right? So there is a big lack of leadership today. I see that as a big, big problem actually. That is why we have a program now for manager to leader. And then people are, and we have several clients that have businesses that grow fast and then they hire people from large organizations and it doesn't work. Why doesn't it work? Because they hire managers and not leaders, but they are impressed by the competence and the language they have, but it doesn't work. If you want to grow a company fast, have to hire builders, not managers. And it's okay if you want to be a manager in a large company and you want to follow the rules and all that, that's fine. But leadership is a different way. It's a different thing. So do think that a ⁓ lot of companies fall into what they call this reporting trap? I thought about that. When we prepared this, I think that was before we met. Maybe just at the beginning we met. A large international Norwegian company, and it was P.E. owned, private equity owned, and they were losing money. ⁓ they asked me if I wanted to take over as CEO and president of the company. One of the things I asked them was how big is the report package? And it was PEO, they had a lot of industrial advisors at the board and a lot of people that were really good with numbers. I'm really good with numbers too. And they said it was that many pages. And I said, how much time does it take from the financial department? And they said, it takes about two to three weeks for the CFO, the chief financial officer, and the department to work out the reporting package every month. And then I said, I don't want to work with you. Because they were more, and that is why they were losing money. Because it was more important for them to tell why they were losing money than to create the future. When I was CEO of Alpha, I got a report package and I just asked the CFO, why do we have these reports? And he said, I don't know. Well, let's take it away. And he said, we cannot do that. Maybe if someone needs it. I said, let's take it away. If they need it, they will ask for it, right? So we reduced the report package, right? We took away a lot of work from the financial department and the accounting. And instead of reporting, they could focus on making the business better. did anyone ask for it? No, it didn't happen. Well, we delivered really good results, but there were times when we struggled as well. What happened was that, I mean, in the first year I was CEO, and Elfa bought a lot of steel. because they produce all these steel drawer baskets and shelving system and all that and the steel prices doubled. But if we had been more concerned about reporting what happened and solving the problem, we would have been in deep trouble. We didn't focus on that. We focus on how could we solve the problem. This is the problem. We are going to deliver the profitability no matter what. Where can we increase prices? can ⁓ we ⁓ change the products? Where can we be more efficient? And that was led by the... by the financial department and the production because they didn't report. The reporting has happened. What is important is what's going to happen. It's like when I watch the news on TV, say it's not... watch the old. I watch the old because it has already happened. It's totally wrong to call it the news. And all reports... They it summary. Today's summary. Today's summary. Yeah. And what shit has happened is what they talk about. They never talk about the good things, right? But reporting, and if you are a manager or a leader today, I want you to reflect on the reporting. Why do we actually make this report? And if you are stuck in reporting, be very aware because you lose focus on the future and business is created in the future. I think I can see that from the businesses I have worked in, that's most, what you call it, public health. Public services. And one of the challenges there is that a lot of professionals are promoted into manager roles. why do you think that they stop there being manager and they don't develop being a leader? And why do you think there is a reason for that? The system takes them. And that's so easy. And it's really important. If you organize... business if it's a public service or a private company whatever it is right think about the purpose of the company why do we exist a company always exists because it solves a problems for problem for someone else right when we were running dental clinics the problem we sold was that you had the bad bad teeth right we sold that with just regular service and didn't sell the problem we sold the solution we sold this year but it's like you have to solve a problem right It's like our business. People are not happy. I want to thrive. I want to live a life that feels like me and have the freedom to live it. We help people doing that. And we live it ourselves every day. But it's so important, right? And it's so you have to go back to the purpose of the company. Why? What do I deliver that people are willing to pay for? And that is not reporting. And that is not a system either. I always said that we have to be 98 percent market oriented. Not 100%. We have to be 98 % market oriented. What's the two? The profit. The profit. Because if you always do what the client wants, and very often the client doesn't know what they want, Then you need a system. It's just that, and I have this from one of the production guys I worked with. And he said, reporting a system as little as possible, but enough. as little as possible what is necessary. And that's a very, very good thing, right? Don't create a system. It's like one of the big discussions I heard from a client was that they had a huge discussion about the color of the company cars. I said, why did you discuss that? Why can't people just have the color they want? And he said, I don't know, but it's a part of a branding. said, no, it's not the part of the branding. It's not. It's only a way. It's only a manager that has a need for controlling that everyone should be. the branding should be colorful. Yeah, maybe. Or that everyone should have white cars. Yeah. No, it's not. And it's so important, you know, to always think that always think that you solve a problem for the client because it is the customer that actually pays your salary. And that is leadership. Management is that you don't think about the client that you think about the system, but you have to think about the customer It's like being in Coca-Cola or I worked in Nestle, right? and we sold a lot of boo-yongs, ⁓ right? And is ⁓ completely until you see how emotional it is for products because to put the wrong boo-yong like a beef boo-yong ⁓ into soup It will destroy your soup. course, and then it's a very profitable product ⁓ And then it gets interesting, right? But you solve a problem, you have to be aware of what you do. And that and leadership is also to improve your business. People have so long processes and they feel and then they get some consultants in and I should not talk down consulting since my son is working in maritime consulting. But that's too. mean he helped. They help a lot and they do a really good job. it's like leadership is not to get everything described. know leadership is not to have a new quality system. ⁓ Leadership is not a new ERP. So leadership is. kind of letting go of having control. You need to have some control. Yeah, you have to trust the people. So letting go of your ego, maybe. Yeah, that's true. I haven't thought about that. Letting go of your ego. Well, you can build a different ego, right? You can identify as a leader and be proud of that. Right. Take care of your people. Take care of your business. And I understand it's difficult as the companies grow bigger and bigger and bigger. And someone who is in a really big company will for sure think that I don't know what I'm talking about, but I think I do. I know you do. And I have done my mistakes too. Yeah. One of the mistakes I did when I was too much manager and too little leader was that I didn't optimize my team. Right. I kept people that were underperforming because I was afraid of hurting their feelings. Right. That is one of the biggest mistakes I did. Right. And being liked is not the purpose of being a leader. leadership is not a contest in management, it's not a contest in popularity. And you know, if you don't, when you don't optimize your team, the cost, and I didn't think like that before, but the cost is not that you have people underperforming. The cost is that you don't get the best performers into your team. Right? Because they will leave or they won't come to you. So that is why leadership is so important. It is actually one of my goal-achieving activities today, that I lead my team in a good way. By definition, that's me. No, we have more. Yeah, just joking. Right? We have Michael in marketing, and we have Thomas in marketing. And all that, so it is. But I mean, it's a challenge to be your leader because you are not very easy to lead. No, I'm not. No, because you think you are right. of course I am. No, you can always be better just like me. Of course. So how so I can share the story. What did I do when I when I was successful and I had my failures too, you know, but. It's like we set really high goals, right? And then we really high goals. had no idea how to reach those goals. I did the math on it and I didn't know how did we actually ⁓ increase grow alpha in four years that much. We had a fantastic strategy on how to serve our clients and we follow them as they grew. then so we had like 25 % organic growth year over year. And then we did two acquisitions. One that was really good, another one that was more challenging, but we knew that. And then we sold the company, right, to private equity in 2007, 2008. So it is to set high goals, make fast decisions. Don't be afraid of making decisions. We have a new client coming to us that is in a large corporate organization now, and he asked me about what is fast decisions, and I said, it is within seconds. It is that the leader decides. You can listen to your people, and then you decide. And he said in our system it is like within a month, then we are really... Then the decision is old already. You are outdated, right? I mean the market moves so fast now that you risk being outdated. So you're all the time trying to catch up. mean, yeah. So I understand there's a difference between being like entrepreneurs and like we are now and in the corporate world, but I know the corporate world, right? And when I read that at LinkedIn, and I don't use LinkedIn very much, but I read sometimes, I wonder where is the world going? Just before we started this recording, I read a LinkedIn post and I said to you, I wonder if I should reply to that. And you said, why? I said, no, I'm not going to do it. But he said that the reason, and this was a consultant working with management, and he said that the reason why managers don't have time. The reason why employees are dissatisfied is because managers don't have time to manage their people. That is not a time issue. That is an attitude issue. I totally agree. It's an attitude. You see yourself as a manager and then you are sucked into all those things you shall do and you get busy being busy. It's the biggest trap. Why? Because you don't have clearly defined goals. Organizations don't have clearly defined goals. They have 100 goals and everyone are important. There are only two goals for a company. Grow sales, grow profit. So I actually think you can answer that post on LinkedIn now because you just send a copy of this episode. It will be fun. But it's so important, right? Just to grow the business. I mean the purpose. Why do we have a business? Solve problems. be profitable and then the owners will get back through dividends, being proud and never underestimate the emotional side of owners. Never, right? And then ⁓ focus on that, right? Because the purpose of the company is not that you shall be a manager. The purpose of the company is that you shall solve problems for the client and the client is willing to pay for that. So what has to change inside a person when they move from manager to leader? A self-image. First of all the image that you have to stop being manager and you have to be a leader. You have to understand what a leader is. That you break down goals, that you take care of your people, that the people can come to you if they have a problem. Don't accept people coming to you with a problem, only accept when they have a problem with a solution. you don't get all the monkeys on your table. But it's true. Because then why is that important? Because then it's fun to work for you. Because then you challenge them, you leverage people. It's huge difference between delegating and leveraging. Delegating is to give away things that you don't want to work with. Leverage to someone is to give someone a job or a task that will be a quantum leap for them. Give other people chance to succeed. So leadership requires less ego. Less ego because you have to stop being afraid of failure. It demands more responsibility. cannot blame anyone else. You cannot call HR or communication or anyone to say, can you fix this for me? No, you fix it yourself. You're a leader. You say, this is the way we do it. You listen to the advice from your group and then you say, this is what we do. And then you make sure that that is done. Maybe that's back to where we started this, people today are actually more afraid of making mistakes because they have to be accountable. for that mistake if they do it. But being a leader, you are actually proud of taking responsibility for your actions. That's true. And that's a good point. Back to I said, I always said that let's make a hundred decisions if one is wrong, we fix it, but don't do it again. I said, I will never put you up on the wall and nail you to the wall because you did the mistake, because you tried and you did your best. But don't do it over and over again, because then you don't learn. You we don't make mistakes, we learn. cannot be afraid. And of course, as a leader, you are much more visible. Yeah, because you stand out. You cannot hide behind someone. Right? As a lot of people say that someone has to do that. There are no someones in any company, right? I have never seen an employment contract saying someone. ⁓ that would be a nice name for a child, actually. So many stay as managers because it feels safe. But then you don't grow. And if you wonder why you get burned out, why you get tired, sick and tired of being in your job, it's because you get stuck. So leaders create visions, create priorities and they create purpose, right? And without direction people stay busy being busy. It's important with all these meetings, you know. We have to have a meeting. I always said that the best meeting was the meetings that never happened. Yeah, because then someone fixed it. We didn't have to have the meeting anymore. That's perfect. Yeah, and then progress flows. So managers, they control leaders trust. tear down pyramids cannot not take responsibility. If you are informed about the goals, about the task and about our mission, they will take responsibility and do it. Uninformed employees cannot take responsibility because they don't know the direction. That is a leader. You trust people. You make sure that they have what they need. And he said another thing too. Sorry if I'm just going out, but it comes to mind. said, and that is one of the things I focused a lot on leading companies was that we have to look at good costs and bad costs. Good costs are costs that increase either the employee satisfaction, meaning that they can do a better job, or you increase your sales. Bad costs are just costs. And one of the things he did was that all the, you know, to run an airline company is like it's like a theater, right? Everything happens on the backside and then the carpet goes up and you expect a great service. Right? So what he did, he invested in new trolleys, serving trolleys for all for the cabin crew, because they complained a lot about all trolleys making it difficult for them to give great service. And one of the first things he did was that he invested in lot of neutralities and they got so happy. He saw them, he understood them and they delivered. That is leadership. So... Should we wrap this up? Yes, we should. It's always fun making these podcast episodes because we start somewhere and we never really know where we are ending up. But that's how we are. mean, it's one of... Make a plan and not follow it. Yes. And I thought that was really bad, right? Because you are a planner and I'm... not that much planner. No, I'm a leader, right? But then I realized that it's really good, right? The purpose of the planning is the planning. And I want to, this relates back to leadership compared to management, right? Because the purpose of the planning is the plan. And then when you have made the plan and if you just follow that as a slave, you don't... take into consideration that you can grow and that you can learn more. Right. So you make a plan and don't follow it because when you make a plan, you prepare yourself for growth and you open up for new possibilities. That was one of the things I was really good at in the corporate world. Right. I worked with a lot of Swedes. I was running a Swedish company, Lotta Swedes, and they were afraid of making mistakes. I said, I am in charge here. So if you want to blame someone, blame me because it's my responsibility. Let's take action. And then they relaxed. Of course. Yeah. So, ⁓ but this is close to both you and my heart, right? Leadership is so important and there is a huge lack of it. It is. is. So if you like this, please subscribe and share it with others. ⁓ If you really hate it, send us an email at hello at christenjohnson.com and tell me. Tell us that you are completely wrong. would love to discuss this with you. follow on LinkedIn. Follow on LinkedIn, yes. Anyway, ⁓ subscribe, share. And ⁓ if you want to talk to us, let's have a talk. You can go to our website, ChristoJohnson.com. There is a button there called Let's Talk. And you can book a clarity call. I will answer. You will answer that, And you will give clarity. It's no pressure, only clarity, which is actually the start of being a great leader, to gain clarity. Everything we do is to your success. As always. As always, we wish you a wonderful day. Bye bye.