Identity Is Destiny: Leadership and the Roots of Value Creation

Identity Is Destiny: Leadership and the Roots of Value Creation

by Laurence D. Ackerman




In this time when "change is everything," leaders and people at all levels of organizations need guideposts to live, work and grow by - unshakable principles that can be relied upon implicitly, irrespective of how much technology and globalization drive people to change. Today, organizations and individuals alike need a compass with which to set a course that is true and that they can believe in no matter what.
In this groundbreaking book, Laurence Ackerman reveals that identity - the unique characteristics that define who we are-is such a compass. Surprisingly, Identity Is Destiny shows that organizations who are best able to adapt to change are those whose leaders understand and "invest in"-rather than change-their companies' unique identities. It is when leaders align strategic development and day-to-day operations with their company's unique, value-creating capacities that identity truly becomes destiny.
The author illustrates how identity gives rise to culture, that identity precedes strategy, and that, most important, companies like individuals, can never be other than who they are.
Ackerman describes three features that mark organizations who are led according to their true identities: grand efficiency - having all parts of the enterprise working in sync; integrity - in the sense of unity, or "wholeness;" and endurance-the possibility of the company living in perpetuity. The author goes on to provide a comprehensive blueprint for "identity-based management"-everyday decision-making and action-that reveals a path to authentic leadership.
When it is clear who a company is, Ackerman explains, everything else follows naturally: making acquisitions that fulfill their promise; hiring and retaining people who "fit in;" developing marketing and product strategies that make sense for customers and the company alike; establishing partnerships that work.

Product Details

ISBN-13: 9781576750681
Publisher: Berrett-Koehler Publishers
Publication date: 03/28/2000
Pages: 220
Product dimensions: 6.44(w) x 9.50(h) x 0.75(d)

About the Author

Laurence D. Ackerman was born in New York City. He received a B.A. in English from Carnegie-Mellon University and an M.S. in communications from Boston University. He is a senior vice president of Siegel & Gale, an international consultancy specializing in business transformation through corporate brand management and interactive communications.

Table of Contents



Leadership Meets

For all the study and writing on leadership, the subject still retains an air of mystery that fuels our curiosity and impels us to learn more. Leadership is the prerequisite of all other things: of change, of growth, of achievement.
When we think of leadership we typically think of individuals who demonstrate courage under fire, boldness in the face of uncertainty, determination against all odds. We often look upon those in leadership positions as larger-than-life figures, somehow different from the rest of us. In business we point to such people as Louis Gerstner at IBM, Percy Barnevik of Asea Brown Boveri, Andrea Jung of Avon, and Jack Welch at General Electric. On the world stage we single out the likes of Nelson Mandela, Franklin Delano Roosevelt, and Mahatma Ghandi. All of these individuals have demonstrated varying degrees of courage, boldness, and determination.
But if leadership demands anything, it first demands insight—into people, organizations, circumstances, and situations. Without the knowledge that comes with insight, all the courage in the world can amount to nothing—or worse. Misplaced, it can destroy fine organizations and wreak havoc with the lives of employees; it can even lead the world into war.
The advent of the information age—the age of the knowledge worker—has made leadership harder than ever. From the leader's perspective, command and control do not work very well anymore, because it is impossible to "command" people to think a certain way or to share knowledge they simply choose not to share. Intellectual capital is now as important as financial capital in business planning and execution. The trend toward ever-greater knowledge continues to slice through the historically more physical, unitized world of business described long ago by Frederick Taylor and Alfred Sloan. It is an unstoppable trend, turbo-boosted by the Internet, that is leading us to new ways of perceiving and solving problems and, in the process, altering our beliefs about what begets success.
Walls are coming down, though not without difficulty, between company divisions and between such traditionally self-contained functions as marketing, sales, R&D, manufacturing, engineering, finance, and communications. The "white spaces" between them all—divisions and functions alike—are fertile ground for identifying new business opportunity.
Walls are coming down in other ways as well. Traditional lines of demarcation between competitors are being crossed regularly through joint ventures and strategic alliances designed to boost productivity and expand markets. The result is an atmosphere in which it is not surprising to see Bill Gates bail out Steve Jobs, his long-time rival, by investing in Apple Computer.
Taken together, what do these changes mean? They herald the early stages of a period driven above all by the mechanics of integration rather than of unitization—the integration of experience, ideas, information, relationships, and, of course, the knowledge that is the net result of it all. The power of contemporary leaders will depend increasingly on their ability to perceive and act upon the whole, adopting a truly integrated view of life.
It is in the realm of integration that leadership and identity meet head on. Identity, as I have come to know it, is the unique characteristics of an organization, or individual, which are the integrated result of particular mental, physical, and emotional capacities. Consider it the "soft rock" that is the center of all things human. Leaders who have a firm understanding of identity can look at the world in an integrated way, blending external and internal experiences and events to produce a unified "story" about how things are—or how they might be. Perceiving the world through the lens of identity can provide leaders with perhaps the only reliable road map for navigating the turbulent future.
History Sets the Stage
Over time, I have watched as business organizations have moved slowly but relentlessly toward their inevitable encounter with their own identities. It is an evolution spurred by the mechanics of integration, which are evident in many of the trends that have defined management priorities and practices over the past two decades.
The march toward acknowledging identity gained momentum in the early 1980s, with the rise of corporate culture as an accepted business concept. The popular book Corporate Cultures sparked awareness of the vital role that beliefs and human behavior play in a company's success. One of the book's major contributions was demonstrating how culture "integrates" people across divisional and functional lines.
Around the same time, managers began to think seriously about vision and mission as part of the strategic lexicon of their companies. They discovered that well-crafted mission statements framed strategy in ways people could understand at all levels of business activity, from the executive suite to truck drivers, line workers, and customer service representatives. Apple Computer's original mission, to "humanize the computer," and Maytag's recent aim, to "own the home," are two good examples. Managers found that one of the most powerful features of a robust corporate mission was its ability to bring people together to achieve a common goal.
In the late 1980s and early 1990s, the notion of corporate competencies lent further credence to human characteristics—skills and expertise that integrated multiple disciplines—as the essence of effective strategy. Sustainable competitive advantage was born of these competencies, rather than from the company's technology, capital base, or products and services. The work of Gary Hamel and C. K. Prahalad was instrumental in helping managers recognize the existence, and the relevance, of their organization's core competencies.
More recently, managers have paid serious attention to the idea that successful organizations are united by a purpose that transcends profit. Although such "purpose" yields economic rewards, it also acknowledges the primacy of the human institution in the value creation process. The leading exponents of corporate purpose have been James Collins and Jerry Porras, whose book Built to Last clarified the importance of purpose and other nonfinancial drivers behind what they describe as "visionary" companies.
Coincidental with the rise of corporate missions, competencies, and purpose, managers have focused increasingly on the corporate brand as a vital part of a company's selling proposition. The name Gillette adds inestimable value to the Sensor product line. IBM, American Express, and Intel are "maker's marks" that inspire consumers' confidence in the products they buy from these organizations. What is significant is that the "brand," in all of these cases, is informed as much by a corporation's culture and competencies as by the features and benefits of its products.
The mechanics of integration are most dramatically evident today in globalization, which, in its own unique way, is prodding companies to wrestle with the notion of identity more seriously than ever before. Globalization is forcing a slow but steady integration of national markets and economies. Within far-flung organizations, it is driving the integration of experience, talents, beliefs, and passions among people who don't know each other, who come from different countries, and who don't speak the same language or share the same customs. Yet these people have been brought together to compete in territories where there is no end to the challenges they are being asked to meet. "Who are we?" has never been a more pressing question.
From a historical perspective, one of the most influential thinkers about leadership and identity over the past four decades has been Dr. Abraham Zaleznik of Harvard University. In his classic 1963 Harvard Business Review article, "The Human Dilemmas of Leadership," Dr. Zaleznik wrote, "The exercise of leadership requires a strong sense of identity—knowing who one is and who one is not—a sense of autonomy, separateness, or identity permits a freedom of action and thinking that is necessary for leadership." Dr. Zaleznik's focus was on the individual. What I have come to see is that this same sense of identity exists equally for organizations. Its presence shakes to the very roots the notion of what leadership, and management generally, are all about.
In an article in Forbes magazine in October 1998, Peter Drucker asserts that management is a social discipline that deals with "the behavior of people and social institutions." He continues, "The social universe has no 'natural laws' as the physical sciences do. It is thus subject to continuous change. This means that assumptions that were valid yesterday can become invalid and, indeed, totally misleading in no time at all."
In this book I argue otherwise. There are, in fact, natural laws that are ever-present. These laws provide a framework around which assumptions can and must be made. Unlike the physical laws of nature that derive from the external world, however, these laws flow from within; they flow from identity, governing business life just as they govern life itself. How these laws work—how they influence every organization and individual—is the subject of Identity Is Destiny.
In the past two decades, I have worked with over thirty CEOs and their management teams, helping them come to terms with the identity of their organizations—who those organizations are, what they stand for, and what to do about it. What I have learned firsthand is as much about what leadership is not as about what it is. Leadership is not simply about the CEO, or about other members of top management, or even about outstanding middle or junior managers who are making their marks in far corners of the organization. It certainly is not defined by one's job, position, or title. Nor is leadership just about leading groups of people within organizations. Markets are led, industries are led, societies are led.
From this perspective, I believe that leadership is best understood as an entire way of life; a way of living that is a function of one's identity—the identity of the individual, or the identity of the organization. How identity plays out in the life of an individual, or in the life of an enterprise, is the true test of the leadership mettle of each.
Leaders come in many forms. Meaningful contributions that significantly affect the lives of others are made, for instance, by people whose work requires solitude: software designers and writers among them. To these professionals, add scientists, researchers, and others who, by virtue of their talent and discoveries, often wind up "leading" others. Daniel Yankelovich, innovator of psychographic market segmentation in the early 1960s and founder of Yankelovich Partners, is a prime example. So are Thomas Edison and Peter Drucker.
As a way of life, leadership means find yourself, be yourself, show yourself. Because people regard leaders as special, leadership has become a framework for coming to terms with one's special capacities—one's identity—and then living accordingly. Leadership is not centered on life at the top; it is centered simply on life. The moment we recognize this fact, we are in a position to see that leadership begins as that solitary step wherein we first assume responsibility for leading ourselves. Leadership with a big "L" transforms into leadership with a small "l," a more humbling act of self-accountability that, once undertaken, may or may not result in our leading others.
From this vantage point, authenticity precedes authority, which helps to explain why so many entrepreneurs—Ted Turner, Mary Kay Ash, Michael Dell, Konosuke Matsushita—are held up as examples of true leaders. Their success is a by-product of living according to their identity.
In light of a corporation's identity, the responsibility for leadership belongs to the entire organization; it is no longer the province of a select few. The first aim that goes along with this collective responsibility is to lead the market on the strength of the company's unique, value-creating potential. A second aim follows closely on the heels of market leadership; it is societal leadership—the ability of a company to bring about positive, permanent social change as a result of managing through its identity, and to make money doing so.
A few years ago, I had an opportunity to work with Ernst & Young when the firm was in the midst of reengineering its global audit practice. What came to light was that this seemingly undifferentiable organization (a popular view is that all Big Five firms are largely the same) had clear and distinctive characteristics all its own. What I saw was that E&Y's identity lay in its all-encompassing capacity to create capital advantage for clients. This capacity came to life in terms of financial advantage, operational advantage, and competitive advantage.
But E&Y's contribution in the marketplace transcended its relationship with clients. The institutional role of this enterprise—its contribution not only to its clients, but to society at large—was also inherent in its identity. "Creating capital advantage" was the key to unlocking E&Y's potential to provide greater security to investors and others who rely on the integrity of balance sheets and the economic soundness of corporations.
In spite of the millions of hours, and billions of dollars, dedicated to analyzing why things work or don't work, many companies are focusing on too narrow a set of factors. They study with great discipline vital forces such as production economics, market demand, customer preferences, organization design, culture, and business processes in order to improve the profit and loss statement and balance sheet. New analytical techniques, such as economic value-added (EVA), are developed and lend further credence to self-examination activities.
Often, however, the "mysteries" of success and failure remain veiled. For instance, why did Westinghouse die? Were economic or management weaknesses addressed too late? Was it because the company lacked visionary leadership? Why have so many companies, born decades ago, simply gone away? Did they become anachronisms by stubbornly selling products that people no longer needed or wanted?
Cutting through all the complexities of business and competition today, I believe that the essential reason why these companies disappeared is that managers didn't pay attention to the inherent identity of their organizations; they failed to take stock of the company's unique, value-creating characteristics.
In attempting to figure out why things happen, we as individuals and "we" as organizations—from senior executives and middle managers to rank-and-file employees—spend too much time attending to observable facts and change levers. By contrast, we spend too little time assessing who we are underneath it all—underneath the assumptions about ourselves as "parent" or "spouse," "manager" or "employee," or, in the case of organizations, underneath the strategies, divisions, functions, products and services, and even cultures that constitute the most easily discerned, commonly accepted parts of the enterprise.
I was twenty-five before I began to suspect that things don't "just happen," and it took me another twenty years to unravel the mystery of why they do. Thus I have been the subject of my own experiment and have studied my clients as well. All these experiences and observations have convinced me that there is a reason for how life unfolds and that knowing that reason is priceless.
By way of personal example, my decision to join Anspach Grossman Portugal rather than Arthur D. Little when I was thirty was a gut decision; it simply felt right. I knew that ADL would lend prestige to my career following a two-and-a-half-year stint with Yankelovich, Skelly & White. But I was viscerally drawn to AGP, then a relatively new and small player in the world of corporate identity consulting. I was drawn, as I now see, to the holistic concept of identity rather than to what I saw as the more traditional field of management consulting. I was equally drawn to the extraordinary impact that identity can have in unifying an organization. Looking back, it was a decision that was in perfect harmony with what I was later to learn were the Laws of Identity.
Five years earlier, I had taken a job with Filene's in Boston. It lasted six months. My joining Filene's was in direct conflict with the Laws of Identity. I had ignored—in truth, I wasn't yet aware of—the inviolate facts of life as prescribed by these laws. I didn't realize that my relationship with others (in this case, Filene's) would be only as strong as the natural alignment between my identity and the store's. As I learned, I had no aptitude for retailing and no genuine attraction to it. There could hardly have been two more disparate "beings."
As I have worked with business executives on a broad spectrum of identity challenges, I have also worked to understand and live according to my own identity. It has been a journey with many surprises—sobering discoveries about my past, exhilarating insights into my true strengths, and (maybe most important) a clear understanding of my potential for making a contribution in this world and being rewarded in return.
For my clients as for myself, there have been right decisions and wrong ones. In some of these cases, the correct turn should have been apparent as we approached the crossroads, others only by the rearview mirror. It has taken more than the past twenty years for me to understand fully the forces that have accounted for these turns.
What I finally came to see, only in the last few years, is that identity contains its own logic. Many of the most memorable events in my life could be explained in relation to who I am and who I am not. Events surrounding my clients could be understood in the same way, as dependent on who the company was and who it was not. Seeing the world this way has evolved into a life discipline that I now employ religiously. The insights it yields contain their own wisdom—stop signs and red flags, but also flashing opportunities waiting to be seized.
In the summer of 1996, my family and I spent a week at the Home Ranch in Clark, Colorado. It was there, sitting alone in the anteroom of our cabin, that I realized that the logic of identity actually flowed from a definable set of laws that clarified so much about what works and what doesn't work in life, whether for an individual or for a business organization made up of tens or even hundreds of thousands of individuals. What I understood at that moment was that people and organizations are governed equally by these Laws of Identity—natural laws that explain past events and foreshadow the future.
In discerning these laws, I also discovered that they exist in a certain pattern, a distinct sequence that amplifies their logic and imbues them with additional meaning. Taken in this sequence, the laws form a credo—the identity credo—that speaks to organizations as well as individuals. Both are ordered by identity as the inescapable center of gravity that organizes everything we are and do.
In the identity credo, "I" becomes as much the pronoun of the organization as that of the individual (I, Alcoa; I, Maytag). The eight laws of identity and the credo they reveal are as follows:
I. The Law of Being
Any organization composed of one or more human beings is alive in its own right, exhibiting distinct physical, mental, and emotional capacities that derive from, but transcend, the individuals who make up that organization over time.
"I am alive,"
II. The Law of Individuality
An organization's human capacities invariably fuse into a discernible identity that makes that organization unique.
"I am unique,"
III. The Law of Constancy
Identity is fixed, transcending time and place, while its manifestations are constantly changing.
"and I am immutable, even as I grow and evolve."
IV. The Law of Will
Every organization is compelled by the need to create value in accordance with its identity.
"To truly live, however, I must express myself fully,"
V. The Law of Possibility
Identity foreshadows potential.
"and in this regard, I have much to give."
VI. The Law of Relationship
Organizations are inherently relational, and those relationships are only as strong as the natural alignment between the identities of
the participants.
"But to do so, I need others, and am most productive with those who need me in return."
VII. The Law of Comprehension
The individual capacities of an organization are only as valuable as the perceived value of the whole of that organization.
"To establish these relationships I must first be
recognized for who I am,"
VIiI. The Law of the Cycle
Identity governs value, which produces wealth, which fuels identity.
"and it follows then that I will receive in accordance with what I give."
Taken together, the Laws of Identity largely abolish traditional distinctions between "leadership" and "management," laying out in their place a path for all to follow—for individuals who simply want to make the most of their unique capacities, and for managers bent on having their companies do the same. Call it simply identity-based management. Because the Laws of Identity remove the wall between "managers" and "leaders," I use these two words interchangeably throughout this book.
No life can be lived to the fullest, no organization can hope to reach its potential, without first embracing the Laws of Identity. In the end, the laws are totally interdependent and inseparable. Each, however, has its own special story to tell and lessons to impart—secrets, as it were—about management in times of change for individuals and organizations alike.
In presenting the story of identity-based management, I have called upon my experience with numerous companies that have wrestled with change and growth. Equally important, however, I have drawn on my own life as the human counterpoint to the business narrative. I have done this for three reasons:

First, because the Laws of Identity are drawn directly from human experience and need a human frame of reference in order to be fully appreciated. It is imperative to see the connection the Laws provide between one's self as business executive (or, in my case, professional) and one's self as simply "one's self."

Second, because mine is the life I know best and so constitutes the most reliable example for illustrating how the Laws of Identity affect individuals in their everyday lives.

Third, because leadership, as prescribed by the Laws of Identity, is a state of being that is as obtainable by the common person, in relation to those whose lives he or she affects, as it is the province of the rich or famous. Where and how each of us will express leadership in our lives is unknown before the fact. But the imperative to do so is innate. Identity, along with the leadership potential it contains, is a function of simply being alive.

My aim in using my life as a reference point is to stimulate all readers to consider their own lives—their own identities—within the pages of this book, as a vital step in the process of leading, and working with, others.

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