Perspective, the first of the six leadership capabilities we identify, is also known as worldview, mental model, or mind-set. We place it first because it underpins all the others and is thus the most critical of all six capabilities. When a person’s perspective shifts and broadens, profound change and growth become possible. Just ask Raj.

About six years ago, Raj came to us for help. After a hardscrabble childhood in India, he worked hard and graduated from top engineering and management schools in India and immigrated to the United States, where he found greater success. He emerged as a business leader who was talented at seeing entrepreneurial opportunities and driven to success. He started a software company that went public within five years, with him as CEO. It was the American dream come true. For many people in their early forties, that might have been the pinnacle of success. But for Raj, it was the start of a long period of soul searching and questioning that eventually led him to shift his perspective and, in the process, evolve from a smart leader to a wise leader.

After taking his company public, Raj stepped back from daily operations and hired a CEO from outside to run his company. Unfortunately, the new CEO had a command-and-control management style that clashed with the company’s entrepreneurial culture; this, in combination with the dot-com bust, led to a crisis in the business. The new CEO eventually left, prompting Raj to reassume the CEO role. A naturally intense type A personality, Raj channeled all his high energy into his job. He worked long hours and made enormous progress with the team and key customers. He not only saved the company from crashing but brought it back to growth and profitability. Now the company had to be refocused as a broad-based and high-volume services company instead of being a specialized and high-value services provider. It was a difficult journey, and eventually the struggle and stress began to take its toll on Raj. That’s when he turned to us for executive coaching.

We felt that Raj needed to find the root of his dissatisfaction and discover what he really wanted to achieve in his life. So we engaged him with exercises like visualization, projecting into the future and imagining where he was at that stage of life. Raj realized that his identity was too closely associated with his work and that he was behaving as if nothing else mattered to him. He visualized himself becoming a rich and successful person in the future but without the closeness of his family and friends and good health.

Raj felt shaken by the large mismatch between his own tacit expectations of wanting to have a happy family and his actual work practices. That emotional experience was a jolt that shifted his perspective and allowed him to arrive at a number of critical conclusions about his life and work and where he was headed. His family, health, and happiness had taken a secondary role for a long time, but he had not reflected much on this because he was unable to see himself separate from his work. Instead of being just one of the roles in his life, work had overtaken all other roles in Raj’s life—even though the job that Raj was doing at that time was not particularly energizing to him.

Using our framework, Raj realized that he was operating mostly in the red zone, and to bring balance to his life, he had to shift and broaden his perspective. That meant taking off his red-tinted glasses and seeing the world without filters. After a period of introspection, Raj recognized that he valued his roles as husband, father, friend, and son as much as he did his role as chief executive of his company. His working identity, which he valued the most when he was wearing his red filter, was only a small part of his larger self and life. He came to see that the company could survive without him, but he behaved as if he could not survive without the company, a new perspective that brought him more clarity.

Exercises on managing his energy helped Raj clarify his priorities. He rediscovered activities—like cycling—that energized him and identified those that depleted his energy, such as listening to complaints and problems. With this new clarity about what was important and of value in his life, Raj found a CEO for his company whose energy, passion, and vision aligned well with that of the company. Raj resigned from the board. With that change in place, he refocused his attention on his family for the next three years before he started another company. When we saw Raj recently, he told us that those three years were the best years in his life because he had had the time to do things that were important and fulfilling, like spending time with his school-age children and elderly parents. It also allowed his wife to fulfill her dream and start her own company.

The broader perspective that Raj had gained stayed with him through the years. At one point he returned to India so that his children could experience what he had while growing up. As he turned fifty, he told us that the past decade had been extraordinary due to this change in perspective. He has taken on social entrepreneurship projects in the area of education, bringing his business smart leadership skills into the field to serve the greater good. His health has markedly improved, his wife’s business is flourishing, and his children are back in the United States getting advanced degrees. Raj has achieved an enviable level of contentment.

Raj is like many other entrepreneurs and business smart leaders who operate in the red zone and have a tendency to be consumed by their passion for work and business success. Desh Deshpande, a successful serial entrepreneur in the technology sector and an innovation advisor to the White House under President Obama, notes that many business leaders, especially business smart leaders, place too much importance on success without recognizing that it is just a milestone along a life journey, not the end point. If we focus solely on success, he reckons, then we prioritize only tangible and measurable results like money and power and our position in society, and we ignore all the important intangibles like family, children, and personal growth.¹

Leaders operating primarily in the blue zone, that is, functional smart leaders, have a different set of problems. They tend to be more sensitive about meeting short-term goals and ignore the big picture perspective to achieve those goals. In other words, they tend to get comfortable within the limited function that they boxed themselves into and usually are less inclined to think about, let alone explore, their full potential or long-term opportunities. They generally don’t want to take big risks considering the complexity and volatility in the world.

Many functional smart leaders tend to have a narrow, though deep, view of life that they need to broaden; business smart leaders tend to have a big picture view, but one that often is primarily focused on personal success. In both cases, these smart leaders wear colored glasses constantly and need to remove them in order to shift and broaden their perspective, the fundamental first step on the path to becoming wise leaders. Without this shift, their ability to act and lead effectively as leaders can be severely hampered because they would continue to act in accordance with their limited view rather than using a broader perspective to take actions that are appropriate and context sensitive (we discuss how leaders can improve their action orientation in chapter 3). First, however, we must become aware of our current perspective before we can shift it to help us become wise leaders.