People who wield more influence and impact than others always seem to have incredible networks. While they may not be wealthier or brighter than their friends, everyone leans in when they talk and remembers what they say. What’s their magic?
Having spent decades observing the most highly influential friends and acquaintances in my business network, here are 7 habits that grow your influence… [LinkedIn]
Every man must decide whether he will walk in the light of creative altruism or the darkness of destructive selfishness.
–Martin Luther King Jr.
In his recent bestselling book entitled Give and Take, organizational psychologist Adam Grant divides people into givers, takers, and matchers, then analyzes how each type defines and achieves success. His descriptions and rich examples provide critical insight for CEOs into how their leadership style impacts their organization and its success.
In ten years of studying reciprocity in organizations, Grant has identified three fundamental styles. While each of us may use all three styles on occasion, we tend to use one of these primary interaction styles:
- Takers like to get more than they give;
- Givers prefer to give more than they get, and
- Matchers seek an equal balance of giving and getting.
Examples of takers abound. Although most of us possess a kind of “justice radar” protecting us from predatory types, many takers are good at hiding their true nature. The Achilles heel for takers, however, is that they can’t help themselves and eventually display evidence of their true nature. The late Ken Lay of Enron is cited as a perfect example of a taker in giver’s clothing, often able to ingratiate himself to those in a position to help him. Eventually, though, public company taker CEOs expose their attitude that they are the “suns in their companies solar systems.” Useful unobtrusive measures cited by the author are the size of the CEO’s picture in the annual report, the CEO’s overuse of first person pronouns when describing the company’s progress, and the high degree of compensation the CEO receives relative to his direct reports. For example, taker CEOs tend to earn 3 times as much as the next highest paid executive, while the multiple averages 1.5 for givers.
CEOs who are givers can be harder to detect but refreshing to find. Grant describes a number of giver CEOs who have been very successful while giving much to those around them. Jon Huntsman and David Hornik are two of a number of business leaders mentioned who have succeeded through their unselfish support of those around them.
Matchers “operate on the principle of fairness: when they help others, they protect themselves by seeking reciprocity.” You can tell you’e a matcher if you continually seek to create an even exchange of favors, rather than looking for an advantage for yourself or not keeping score at all. Often, givers become matchers when they have to deal with takers, in order to protect their interests from being bulldozed.
Which style produces the least successful people? Which style is practiced by the most successful? Surprisingly, in both instances, it’s the givers. Two types of givers emerged: selfless givers and other-focused givers. Selfless givers have “high other-interest and low self-interest… and they pay a price for it. Selfless giving is a form of pathological altruism.” Giving without any getting eventually leads to burnout. The real winners are other-focused givers. As Grant puts it, “if takers are selfish and failed givers are selfless, successful givers are otherish: they care about benefiting others, but they also have ambitious goals for advancing their own interests.” Otherish is a term he uses to describe these winning givers who, while they aren’t selfless, they “help with no strings attached; they’re just careful not to overextend themselves along the way.”
Grant offers practical actions you can take to leverage the insight provided by the book. Here are a few:
Test Your Giver Quotient – He provides online self-assessment tools at www.giveandtake.com that you and people in your network can take to rate your reciprocity style.
Run a Reciprocity Ring – What would happen if groups of people in your organization met weekly for 20 minutes to make requests and help each other fulfill them?
Help Other People Craft Their Jobs to Incorporate More Giving – A VP at a large multinational retailers met one-on-one with each of his employees and asked them what they would enjoy doing that might also benefit other people.
Embrace the Five-Minute Favor – Ask people what they need and look for ways to help that are valuable to them but have minimal cost to you.
If you’re interested in moving your business forward using practical knowledge based upon social psychological research, you’ll find Give and Take highly thought-provoking and beneficial.
The April 2 issue of the Austin Business Journal includes a profile of 20/20 Outlook LLC. Thanks to the folks at ABJ and technology reporter Chris Calnan for offering the opportunity and for writing such a nice article!
Given that we’ve answered the “why partner” question, now let’s think about the “when to partner” question. Marketplace issues, whether threats or opportunities, commonly drive partnership decisions. For each issue, consider three factors that determine your desire and ability to grow through partnering:
- Timing: What is the timing associated with this threat or opportunity? Is it immediate or long-term?
- Potential Impact: What is the potential impact of some threat or opportunity that is currently presenting itself? Is it high or low?
- Ability to Respond: What is my current ability to respond? Is it strong or weak?
As far as the Timing factor goes, if an issue, i.e. a threat or an opportunity, is not immediate, set it aside. Maybe someday you’ll find time to worry about that one!
For each immediate issue, determine whether it can have a relatively high or low impact and how strong is your ability to respond. Here’s a diagram depicting these points, followed by a brief description of each one:
High threat/opportunity, strong ability to respond (“Pursue Aggressively”)
This issue is too pressing to postpone, and your company has the resources needed to address it aggressively through product enhancement and new product creation.
Low threat/opportunity, strong ability to respond (“Quick Hits”)
When you spot a weakness in a competitor’s ability to respond to such an issue, attack by leveraging your strength in this area.
Low threat/opportunity, weak ability to respond (“Prepare to Respond”)
These are usually “who cares” issues now that may grow into high impact issues later, so keep an eye on them while doing little to address them.
High threat/opportunity, high ability to respond (“Create Partnerships”)
If you can’t adequately respond to a pressing threat or opportunity, a partnership is the right answer. A partnership can be a precursor to an acquisition.
If I’m right and I’ve communicated clearly, you have a better understanding of why and when to form a business relationship. These are practical business concepts that will ensure your efforts are directed at the best opportunities to achieve the desired outcome for your business – a business that knows where it’s going!
Richard Davis at Needham is a favorite stock analyst. He talks to hundreds of high tech companies every year and thus stays close to what’s really going on in the market. In his most recent “Musings” in mid-December, he shared his thoughts on how software companies did in 2009 and what the outlook for valuations is for 2010.
In 2009 software stocks outperformed the S&P 500 by gaining 50% versus an average 23%.
Interestingly, while software M&A didn’t pick up as much as he expected, the average takeover premium jumped to 50%.
This isn’t counterintuitive in a bad economy when stock prices are tanking, but “this one year trend has convinced CEO’s and Boards that it is an insult unless they get a premium of 50%. This is delusionary and I believe premiums will return to a normal 30% next year.”
2010 looks to be a rebound year overall. I’m looking forward to seeing the level of M&A activity and whether premiums settle back to normal levels.
The data source for post is the December 14 edition of Needham analyst Richard Davis’s Musings. Needham & Company, LLC is a nationally recognized investment banking and asset management firm focused solely on growth companies and their investors. Founded in 1985 by George Needham, Raymond Godfrey, Jr. and David Townes, the firm is headquartered in New York City with offices in Boston, San Francisco, and Menlo Park, CA.