Mindset: The New Psychology of Success

Sometimes the victims are people the bosses consider to be less talented. This can feed their sense of superiority. But often the victims are the most competent people, because these are the ones who pose the greatest threat to a fixed-mindset boss. An engineer at a major aircraft builder, interviewed by Hornstein, talked about his boss: “His targets were usually those of us who were most competent. I mean, if you’re really concerned about our performance, you don’t pick on those who a performing best.” But if you’re really concerned about your competence, you do.

When bosses mete out humiliation, a change comes over the place. Everything starts revolving around pleasing the boss. In Good to Great, Collins notes that in many of his comparison companies (the ones that didn’t go from good to great, or that went there and declined again), the leader became the main thing people worried about. “The minute a leader allows himself to become the primary reality people worry about, rather than reality being the primary reality, you have a recipe for mediocrity, or worse.”

In the 1960s and ’70s, the Chase Manhattan Bank was ruled by David Rockefeller, an excessively controlling leader. According to Collins and Porras in Built to Last

, his managers lived day-to-day in fear of his disapproval. At the end of each day, they breathed a sigh of relief: “Whew! One more day gone and I’m not in trouble.” Even long past his heyday, senior managers refused to venture a new idea because “David might not like it.” Ray Macdonald of Burroughs, Collins and Porras report, publicly ridiculed managers for mistakes to the point where he inhibited them from innovating. As a result, even though Burroughs was ahead of IBM in the early stages of the computer industry, the company lost out. The same thing happened at Texas Instruments, another leader in the exciting early days of the computer. If they didn’t like a presentation, Mark Shepherd and Fred Bucy would yell, bang on tables, insult the speaker, and hurl things. No wonder their people lost their enterprising spirit.

When bosses become controlling and abusive, they put everyone into a fixed mindset. This means that instead of learning, growing, and moving the company forward, everyone starts worrying about being judged. It starts with the bosses’ worry about being judged, but it winds up being everybody’s fear about being judged. It’s hard for courage and innovation to survive a companywide fixed mindset.

GROWTH-MINDSET LEADERS IN ACTION

Andrew Carnegie once said, “I wish to have as my epitaph: ‘Here lies a man who was wise enough to bring into his service men who knew more than he.’ ”

Okay, let’s open the windows and let some air in. The fixed mindset feels so stifling. Even when those leaders are globe-trotting and hobnobbing with world figures, their world seems so small and confining—because their minds are always on one thing: Validate me!

When you enter the world of the growth-mindset leaders, everything changes. It brightens, it expands, it fills with energy, with possibility. You think, Gee, that seems like fun!

It has never entered my mind to lead a corporation, but when I learned about what these leaders had done, it sounded like the most exciting thing in the world.

I’ve chosen three of these leaders to explore as a contrast to the fixed-mindset leaders. I chose Jack Welch of General Electric because he is a larger-than-life figure with an ego he held in check—not your straight-ahead naturally self-effacing growth-minded guy. And I chose Lou Gerstner (the man who came in and saved IBM) and Anne Mulcahy (the woman who brought Xerox back to life) as contrasts to Alfred Dunlap, the other turnaround expert.

Jack Welch, Lou Gerstner, and Anne Mulcahy are also fascinating because they transformed their companies. They did this by rooting out the fixed mindset and putting a culture of growth and teamwork in it place. With Gerstner and IBM, it’s like watching Enron morph into a growth-mindset mecca.

As growth-minded leaders, they start with a belief in human potential and development—both their own and other people’s. Instead of using the company as a vehicle for their greatness, they use it as an engine of growth—for themselves, the employees, and the company as a whole.

Warren Bennis has said that too many bosses are driven and driving but going nowhere. Not these people. They don’t talk royalty. They talk journey. An inclusive, learning-filled, rollicking journey.

Jack: Listening, Crediting, Nurturing