What Is Real Leadership?
I just had the opportunity to read an article about Bill Hawkins, the CEO of Medtronic . The article describes for me an example of real leadership.http://www.bnet.com/2436-13058_23-348860.html?tag=homeCar
Medtronic as the name implies manufactures products that are medical in nature, products like pacemakers, stents, and related things. Products that can and have substantially affected thousands of people's lives. Products that if they work improperly can cause enormous harm or even death.
Two months into his tenure as CEO Hawkins was informed that there was a potential problem with their latest product, a stent that stimulates the heart. The stent could possibly fail either not providing the stimulation or providing it when it wasn't necessary.
The product is FDA approved and the data he had available was within "acceptable" limits, but they suspected there were issues. Withdrawal of the product almost guaranteed negative consequences including the stock price, company reputation, and potential litigation. Hawkins and his team made the decision that continuing to distribute the product was inconsistent with the core values of the organization and withdrew the product. As you might suspect they suffered the consequences. The stock price took a dive and is only starting to recover now, almost two years later. They have some protection from litigation because the product was FDA approved, but that might change.
Did Hawkins make the right decision, I would say yes. He made a decision to support the core values of the organization and stakeholders over shareholders. Shareholders and employees were affected without question, but the risks to patients and human life was determined to be the compelling issue.
It is interesting for me to contrast this decision as it compares to other decisions we have seen made by "leaders" in the private and public sector ranging from bonuses in the financial services sector, elected officials who acted in a pretty "unleaderly way, and others.
You hear a lot about leadership these days and what it means and what it takes. To me leadership is defined by your actions not your words. I am sure Hawkins has his detractors, but I still like to hear about people who act with integrity. That defines leadership to me. What do you think?
Medtronic as the name implies manufactures products that are medical in nature, products like pacemakers, stents, and related things. Products that can and have substantially affected thousands of people's lives. Products that if they work improperly can cause enormous harm or even death.
Two months into his tenure as CEO Hawkins was informed that there was a potential problem with their latest product, a stent that stimulates the heart. The stent could possibly fail either not providing the stimulation or providing it when it wasn't necessary.
The product is FDA approved and the data he had available was within "acceptable" limits, but they suspected there were issues. Withdrawal of the product almost guaranteed negative consequences including the stock price, company reputation, and potential litigation. Hawkins and his team made the decision that continuing to distribute the product was inconsistent with the core values of the organization and withdrew the product. As you might suspect they suffered the consequences. The stock price took a dive and is only starting to recover now, almost two years later. They have some protection from litigation because the product was FDA approved, but that might change.
Did Hawkins make the right decision, I would say yes. He made a decision to support the core values of the organization and stakeholders over shareholders. Shareholders and employees were affected without question, but the risks to patients and human life was determined to be the compelling issue.
It is interesting for me to contrast this decision as it compares to other decisions we have seen made by "leaders" in the private and public sector ranging from bonuses in the financial services sector, elected officials who acted in a pretty "unleaderly way, and others.
You hear a lot about leadership these days and what it means and what it takes. To me leadership is defined by your actions not your words. I am sure Hawkins has his detractors, but I still like to hear about people who act with integrity. That defines leadership to me. What do you think?
posted by Mark at New Paradigms LLC at
2:39 PM
1 Comments:
It's rare to find this kind of corporate social responsibility being promoted; kudos to you. Last year a Wall Street Journal article cited a study of 164 busiensses over 35 years. It showed little correlation between increased revenue and "doing good" by charitable contributions or social investments. The study also showed no hit to sharholders when companies in fact chose to do good. After the past year, the business world may have grown more of a conscience. Just imagine -- if leaders had the ethics of your example, we wouldn't need a single regulation. Ever. Predatory capitalism willing to exploit anyone without regard to personal or social responsibility in order to profit a select few will always lead to disaster (as it has in the USA several times since the Civil War) and eventually result in a third world economy. How stable is that? How safe will the tiny elite feel without a strong middle class, surrounded by crime-driven low income and poverty? Just as almost any Latin American country, including Mexico, right at door.
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