How Authentic Leaders ‘Walk the Walk’

The best leaders take the same hits as their employees and stick to the primary values they promised to uphold.

When Mark Fields became president of Ford Motor’s troubled North American operations in 2005, he quickly announced a turnaround plan called “The Way Forward” that would eliminate 45,000 jobs—more than one-fifth the workforce—and close 14 manufacturing plants. Fields also proposed cutting health-care benefits for the blue-collar workers who remained. He stressed the
sense of urgency with his new slogan, “Change or Die,” which he posted on the gates of the factories. As part of his case for change, he told Ford’s employees that they would have to share the sacrifices to save the company. 

But Fields himself didn’t share in the sacrifices: For cutting costs so fiercely, Fields was richly rewarded with a $2.3 million bonus that lifted his yearly pay to $5.6 million. Rather than moving to Detroit and becoming a full-fledged member of the community, Fields kept his family in Delray Beach, Fla., and commuted every weekend on the company’s private jet. Is there any wonder no one wanted to follow Mark Fields? 

Being an “authentic leader” means two things. First, you’ve got to share the struggle and the risks with your people. Consider these examples: 

• In the early 1960s, when Warren Buffett was recruiting backers for one of his first investment partnerships, he plunged more than 90% of his personal savings into the fund. 

• When Hewlett-Packard faced a recession in 1970, co-founder Bill Hewlett took the same 10% pay cut as the rest of his employees. 

• Whenever Wal-Mart founder Sam Walton travelled on business, he rented the same compact economy cars and stayed in the same inexpensive hotels as his employees. 

• For the first nine years that his Union Square Café was in business, owner Danny Meyer was there in person every day—clearing tables and mopping spills along with his staffers—as together they made it a top-ranked restaurant in New York City. 

• Ray Kroc picked up the wastepaper in the parking lot whenever he visited a McDonald’s to show cleanliness was a continual job for everyone—even the CEO. 

Along with sharing the struggle, there’s another crucial requirement for authentic leaders: They must make sure their actions consistently reinforce the one or two most important values they hold up for their organizations. If you say that you’re going to put customers first, for example, or that you put employees first, and then you had better follow through, especially when you’re forced to make tough trade-offs. 

Jeff Bezos at Amazon.com is one of the rare CEOs who has lived up to his stated aspiration to put customers first. Bezos repeatedly sacrificed short-term profits—and suffered the ire of Wall Street’s stock analysts—by reducing prices and even publishing information on the Web site that discourages customers from buying certain products. Southwest Airlines’ cofounder Herb Kelleher lived up to his “employees first” policy by never laying off its people even when the rival carriers were laying off tens of thousands. 

Proof in the Pudding

Only your actions prove what’s really most important. Danny Meyer fulfilled his pledge to put his employees first by banning smoking in his New York restaurants before it became the law—even though he risked losing good customers in order to protect workers’ health. Apple’s Steve Jobs has stayed true to his company’s top value of enshrining originality in design—the essence of his “Think Different” campaign. 

Of course it’s far more common for would-be leaders to fail to “walk the walk.” While the Coca-Cola Company’s official list of seven “values” includes “integrity” and “accountability,” it nonetheless elevated Muhtar Kent to CEO even though he had been caught betting against his own company’s stock based on insider information—then outrageously claimed not to know his actions were illegal. Even the most well-intentioned leaders often fail to walk the walk. Howard Schultz of Starbucks didn’t live up to his own vision of the customer experience by putting relentless growth and expansion ahead of quality (as he admitted in a leaked memo). 

For examples of who does and doesn’t walk the walk today, see www.businessweek.com 

Alan Deutschman is the author of Walk the Walk: The #1 Rule for Real Leaders. 

Tax credit for relocation, overtime payments, meal and sustenance allowance.

The tax rules around the treatment of relocation payments, overtime, meal and sustenance allowances from the 2002-2003 income year have been clarified to remove uncertainty about whether these payments to employees are tax-free. So, if you’ve taxed any of these since the 2002-2003 income year you may be entitled to a credit of overpaid PAYE.

The rules changed from the 2002-2003 income year. So, if you’ve taxed payments of relocation payments, overtime meal allowances or sustenance allowances that meet the IRD requirements in the past, you may be entitled to a credit for over-paid PAYE. Where these payments have been claimed as a business expense for income tax purposes, an adjustment may be required in the corresponding income tax returns.

Visit the IRD website to find out the criteria requirements: http://www.ird.govt.nz/aboutir/newsletters/business-tax-update/2009/btu-issue-003-11-09.html#04

You can make the PAYE adjustment by completing an Employer monthly schedule amendments (IR344) form for the return periods affected. You’ll also need to advise the IRD in writing about any adjustments required to your income tax returns.
Before making these adjustments you may wish to discuss this with your accountant or business advisor.

Pearl Moment

Clifton Motors of Penrose, now Clifton Enterprise, have been using Datacom’s outsourcing payroll services for over 30 years, making them one of many customers that have been with us since the very beginning. 

Clifton Enterprise chose to use Datacom’s EasiPay payroll service as it reduced the amount of time being stuck in the back office and got the owners back on the shop floor to continue business. This small automotive company has been providing local residents and businesses with servicing and mechanical repair services which helps the community keep on moving.

Clifton Enterprise can be found at 707 Great South Road Mt Wellington.

The ultimate win-win in charitable giving

An immediate tax break and a chance to lend a hand to people living in poverty is the new, ultimate, win-win in charitable giving. World Vision’s Workplace Giving now offers New Zealand employees the chance to do just that.

Under the scheme Kiwis can opt to make regular donations to World Vision and claim an immediate tax break through a PAYE tax credit on pay day – gone are the days of having to collect receipts and claim an annual tax rebate. Workplace Giving participants can sponsor a child and help create positive outcomes for that child, their family and their community. Alternatively, they can support World Vision’s microfinance scheme VisionFund, and provide poverty-stricken entrepreneurs with loans and training to start their own businesses, create a sustainable income and build a better life for themselves and their children.

When you lend a hand through World Vision’s Workplace Giving you will be joining with more than 65,000 kiwi households and partnering with New Zealand’s largest humanitarian aid organisation working in 18 developing countries. In the last financial year World Vision allocated 79 cents of every dollar given directly to its programming work – so why not ask your employer about joining World Vision’s Workplace Giving programme in 2010 and join a movement of Kiwis committed to transforming thousands of lives and creating a better world.

For more information go to: www.worldvision.org.nz/workplacegiving

Keeping Track of Time

As a result of customer input Datacom has included a Comments column on the electronic timesheets for the Employee Self Service system.

This is so managers and employees can keep track of reasons why employee’s have or haven’t worked specific hours. The Comments column has been added to all timesheets (Company, Reportee and My) in ESS/CSS. The column is configurable and by default is not selected. To make the Comments column appear select the following:

The maximum Comment can only be 255 characters and Comments can be saved anytime whether a value is entered or not in the Timesheet row.