The most important lesson
Yesterday I had the chance to listen to an improvised talk by John Donahoe, former CEO of eBay as part of my studies in Stanford.
John is incredibly insightful and comes across as trustworthy and authentic. I was surprised with how someone so accomplished was able to relate with the audience on such a personal and intimate level. He was, to a certain extent, the representation of what “great leader” means to many entrepreneurs. What most aspire to be.
John delivered a great talk and you almost expect that of him. He talked about books that he felt he could relate to, change agents that helped him during his tenure, about failing and getting back on your feet, how a good strategy must be outside in, and about the four key aspects you should strategize around: Customers, Competitors, Capabilities and Culture. He explained how he always tried to communicate with his team by framing evolution as “from -> to”, so people could easily (and clearly) relate to the change that sometimes is required in businesses. He then defined what it means for him to be a good leader, saying that people will follow those who are “Authentic” and “Get it”.
This was an amazing talk followed by a great and honest discussion. But this was not the most important lesson.
The most important lesson was the framework John uses when responding to failure and inspiring organizational change during adversity.
When faced with strategic issues leaders often realize they need to change their organizations. However this is not easy: People oppose change, power users might call you a killjoy or worse, good management works hard to protect revenues, etc. This makes it extremely hard to champion change especially when the business is apparently doing well. Good leaders see early signs of inflection points in their businesses and instinctively know they need to act. But how do you promote and establish change when everything seems to be going well?
This was the most important business lesson I’ve learned here. An elegant and simple way to get buy in from your shareholders, employees, and key stakeholders:
- Label the problem
- Propose and justify the strategic solution
- Put the right people in the right place
In John’s case the challenge was to transition eBay from being an online auction site. So he could label the problem: it simply wasn’t economically feasible for eBay to continue to be “niched” in auctions when most customers used eBay to simply purchased goods. Auctions was just a legacy by-product of the evolution of eBay.
The future was a simpler, more consumer friendly experience focused on mobile platforms. That was how consumers wanted to purchase goods online. This was the strategic solution.
Finally John needs to put the right people in the right place to do this transition. Everyone wants to be liked and John was no exception. But he had to accept some people will not want to be part of change and they won’t like you or buy into your change. They will not help. Thus it’s important to have the people involved that want to be part of that change; or like my peer Rudi de Sousa keeps saying it’s all about “Attitude and Aptitude”. And we need to be deliberate making our choices, and only taking on the journey those who want to be on the ride.
I found this simple framework to be fantasticly insightful and useful, and it’s a lesson I’ll probably use many times in the future of YLD.
