Chapter 14
Servant Leadership

Ken Blanchard,
Scott Blanchard, and Drea Zigarmi

When people lead at a higher level, they make the world a better place, because their goals are focused on the greater good. This requires a special kind of leader: a servant leader.

Robert Greenleaf first coined the term “servant leadership” in 1970 and published widely on the concept for the next 20 years.¹ Yet it is an old concept. Two thousand years ago, servant leadership was central to the philosophy of Jesus, who exemplified the fully committed and effective servant leader.² Mahatma Gandhi, Dr. Martin Luther King, Jr., and Nelson Mandela are more recent examples of leaders who have exemplified this philosophy.

Max DePree, legendary chairman of Herman Miller and author of Leadership Is an Art, compared this role to that of a third-grade teacher who keeps repeating the basics. “When it comes to vision and values, you have to say it over and over and over again until people get it right, right, right!”

As you now know, the responsibility for this visionary role falls to the hierarchical leadership. Kids look to their parents, players look to their coaches, and people look to their organizational leaders for direction. The visionary role is the leadership aspect of servant leadership.

Once people are clear on where they are going, the leader’s role shifts to a service mind-set for the task of implementation—the second aspect of leadership. How do you make the dream happen? Implementation is where the servant aspect of servant leadership comes into play. In a traditional organization, managers are thought of as responsible, and their people are taught to be responsive to their boss. “Boss watching” becomes a popular sport, and people get promoted on their upward-influencing skills. That activity doesn’t do much for accomplishing a clear vision. All people try to do is protect themselves rather than move the organization in the desired direction.

Servant leaders, on the other hand, feel their role is to help people achieve their goals. They constantly try to find out what their people need to perform well and live according to the vision. Rather than wanting people to please their bosses, servant leaders want to make a difference in the lives of their people and, in the process, impact the organization. With its emphasis on bringing out the magnificence in people, Situational Leadership^® II is a servant leadership model.

Ken Blanchard had avoided his local DMV like the plague. But several years ago, he lost his driver’s license about three weeks before he was scheduled to leave on a trip to Europe. He knew he had to go to the DMV and get a new license to back up his passport on his trip. So he said to his executive assistant, “Dana, would you put three hours on my calendar next week sometime so I can go to the DMV?” In Ken’s experience, that’s about how long it usually took to get anything done there. He’d wait for a long time, and then they’d tell him he was in the wrong line, he’d filled out the wrong form, or he’d done something that meant he had to start all over.

As a result, Ken headed over to the DMV with low expectations. (Remember, he hadn’t been there in years.) He knew immediately something had changed when he walked in the front door, because a woman charged him and said, “Welcome to the Department of Motor Vehicles! Do you speak English or Spanish?”

“English,” Ken replied.

She said, “Right over there.” The guy behind the counter smiled and said, “Welcome to the Department of Motor Vehicles! How may I help you?” It took Ken nine minutes to get his replacement license, including having his picture taken. He said to the woman who took his picture, “What are you all smoking here? I mean, this isn’t the Department of Motor Vehicles that I used to know and love.”

She asked, “Haven’t you met the new director?”

“No,” he said.

So she pointed to a desk behind all the counters, right out in the open. Clearly the director had no privacy. His office was in the middle of everything. Ken went over, introduced himself, and said, “What’s your job as the director of the Department of Motor Vehicles?”

What the man said is the best definition of management we’ve ever heard:

The director obviously had a compelling vision for this department. The point of their business was to serve the citizens and their needs, and to serve them well.

What did this director do? He cross-trained everybody in every job. Everyone could handle the front desk; everyone could take the pictures. You name it—everyone could do it! Even the people in the back, who normally weren’t out in front, could do every job. Why? Because if suddenly there was a flood of citizens, why have people in the back doing bookkeeping, accounting, or secretarial work when there were customers who needed help? So he’d bring them out when they were needed.

The DMV director also insisted that nobody go to lunch between 11:30 and 2:00. Why? Because that’s when the most customers showed up. Ken told this story at a seminar one time, and a woman came up to him at the break and said, “Where is your Department of Motor Vehicles? I can’t believe what you’ve been telling us.” She continued, “I recently waited in line for about forty-five minutes at our DMV, and I was almost at the front of the line when the woman announced, ‘It’s break time.’ We had to stand around for fifteen minutes while they all went for coffee and stretched their legs.”

That didn’t happen at this “new” Department of Motor Vehicles, where the director had created a motivating environment. Those team members were really committed. Even employees Ken recognized from past visits who had joined in on the “fun” of abusing the customers were now excited about serving.

Often you see people at one point and they are so excited about their work. Then you see them three months later and they’re discouraged. In 90 percent of these cases, the only thing that has changed is that they’ve gotten a new boss. Someone who jerks them around, who doesn’t listen to them, who doesn’t involve them in decision making, and who treats them as if they really are subordinates. The reverse is also true. People can be unhappy in a job situation when suddenly a new leader comes in and their eyes brighten, their energy increases, and they are really ready to perform well and make a difference.

When leaders make a positive difference, people act like they own the place, and they bring their brains to work. Their managers encourage their newfound initiative. Another example from the “new” DMV punctuates this point.

“Dana,” the woman said, “I noticed that in three months you have to retake your written driving test. Why don’t you take both tests today?”

Caught off guard, Dana said, “Tests? I didn’t know I was supposed to take a test.” And she started to panic.

The woman reached over the counter, patted Dana’s hand, and said, “Oh, Dana, don’t worry. With your driving record, I’m sure you can pass these tests. And besides, if you don’t, you can always come back.”

Dana took the tests. She went back to the woman, who graded them. Dana fell one correct answer short of passing each test, so officially she failed both. But, in a kind way, the woman said, “Oh, Dana. You are so close to passing. Let me try something. Let me re-ask you one question on each test to see if you can get it right so I can pass you.” Not only was this a wonderful offer, but the fact was, each question had only two possible answers. So the woman said, “Dana, you chose B. What do you think would be the right answer?”

When Dana said, “A,” this helpful woman said, “You’re right! You pass!”

Ken once told this story at a seminar, and a bureaucrat came racing up to the platform during the break. He started yelling, “Why are you telling this story? That woman broke the law! Your assistant failed both of those tests!”

So Ken went back to see his DMV director friend. He told him about this bureaucrat, and the director said, “Let me tell you one other thing. When it comes to decision making, I want my people to use their brains more than rules, regulations, or laws. My person decided that it was silly to make someone like your assistant Dana, with her perfect driving record, come back to retake a test on which she missed only one question. I guarantee you, if she had missed four or five questions, my person wouldn’t have given her the same deal. And to show you how important I think this is, I would back that person’s decision with my job.”

Would you like to work for this kind of leader? You’d better believe it. Why? Because he is a servant leader. In Rick Warren’s best-selling book The Purpose Driven Life, the first sentence is “It’s not about you.”³ Just like our DMV director, servant leaders realize that leadership is not about them. It’s about what and who they are serving. What’s the vision, and who’s the customer? The vision answers Hayes and Stevens’ question, “What’s the point?” As the authors of The Heart of Business insist, “profit can be a by-product of the pursuit of a higher purpose and even part of the planned process in pursuit of that higher purpose, but it should never be the purpose and motive itself.”⁴ If profit is your reason for being an organization, it will eventually drive your people and customers to be self-serving, too. As we argued in Chapter 3, “Serving Customers at a Higher Level,” everyone has a customer. Who is a manager’s customer? The people who report to that manager. Once the vision and direction are set, managers work for their people.

Strategic leadership is the “what” that ensures everyone is going in the same direction. It’s where the answer to the question “What’s the point of your business?” is found. Strategic leadership includes activities such as establishing a clear vision, maintaining a culture that aligns a set of values with that vision, and declaring must-do initiatives or strategic imperatives that the organization needs to accomplish. Vision and values are enduring, whereas strategic imperatives are short-term priorities that could last a month or two, or a year or two. An example of a strategic initiative is David Novak, chairman and CEO of Yum! Brands, declaring a customer mania focus for all the company’s restaurants around the world. Strategic leadership is all about the vision and direction aspect of leadership, or the leadership part of servant leadership.

Operational leadership is everything else. It provides the “how” for the organization. It includes the policies, procedures, systems, and leader behaviors that cascade from senior management to the frontline employees. These management practices create the environment that employees and customers interact with and respond to on a daily basis. Operational leadership is all about the implementation aspect of leadership, or the servant part of servant leadership.

Blanchard and Zigarmi discovered that employee success included things like employee satisfaction (I am happy), employee loyalty (I will stay at my job), employee productivity (how I am performing), perceptions of one’s relationship with his or her manager and the teamwork in the environment, and more tangible measures, like absenteeism, tardiness, and vandalism. They identified all these factors as employee passion.

When it came to customers, their reactions to the organization’s environment fell into three bodies of research: satisfaction (I am happy with how this organization serves me), loyalty (I will continue doing business with this organization), and advocacy (I am willing to speak positively about my experience with this company). The net result of these three factors they labeled customer devotion.

Blanchard and Zigarmi combined all the hard measures of organizational success (profitability, growth over time, and economic stability) and soft measures (trust in the company and a sense of its integrity) into a concept they called organizational vitality. In many ways, organizational vitality depicts that triple bottom line—being the provider of choice, employer of choice, and investment of choice—we discussed in Chapter 1, “Is Your Organization High Performing?”

If leadership is the engine that drives a high performing organization, Blanchard and Zigarmi were interested in how the two aspects of leadership—strategic leadership and operational leadership—interact with and impact employee passion, customer devotion, and organizational vitality. Figure 14.1 shows the leadership-profit chain of events.

Figure 14.1 The Leadership-Profit Chain

Interestingly, Blanchard and Zigarmi found that while strategic leadership is a critical building block for setting the tone and direction, it has only an indirect impact on organizational vitality. The real key to organizational vitality is operational leadership. If this aspect of leadership is done effectively, employee passion and customer devotion will result from the positive experiences and overall satisfaction people have with the organization.

It is also interesting to note that positive employee passion creates positive customer devotion. At the same time, when customers are excited about and devoted to the company, this has a positive effect on the work environment and the employees’ passion. People love to work for a company where customers are raving fans. It makes them gung ho, and together the customers and employees directly impact organizational vitality.⁶

The big-picture conclusion from the research of Blanchard and Zigarmi is that the leadership part of servant leadership (strategic leadership) is important—because vision and direction get things going—but the real action is with the servant aspect of servant leadership (operational leadership). If the vision and direction are compelling and motivating, and leaders do a good job of implementing them in the eyes of the employees and customers, organizational vitality and success are ensured.

To do a good job, effective servant leaders must be environmentalists whose job is to create and maintain a culture that turns on employees so that they can turn on customers. These leaders do that by looking down the traditional hierarchy and saying, “What can I do for you?” rather than their people looking up the hierarchy and saying, “What can we do for you?” That’s why Yum! Brands calls its corporate headquarters “The Support Center” and has changed all manager titles to “coach.”

When managers focus only on organizational indicators of vitality—such as profit—they have their eyes on the scoreboard, not the ball. Profit, a key aspect of organizational vitality, is a by-product of serving the customer, which can be achieved only by serving the employee. So profit really is the applause you get from taking care of your customers and creating a motivating environment for your people.

If the servant aspect of servant leadership has a greater impact on organizational vitality, how do leaders develop their serving qualities?

The most persistent barrier to being a servant leader is a heart motivated by self-interest that looks at the world as a “give a little, take a lot” proposition. Leaders with hearts motivated by self-interest put their own agenda, safety, status, and gratification ahead of those affected by their thoughts and actions.

In a sense, we all entered this world with a self-focus. Is there anything more self-centered than a baby? A baby doesn’t come home from the hospital asking, “How can I help around the house?” As any parent can attest, all children are naturally selfish; they have to be taught how to share.

The shift from self-serving leadership to leadership that serves others is motivated by a change in heart.

In his book Ordering Your Private World, Gordon MacDonald discusses an interesting distinction that can help us understand the difference between servant leaders and self-serving leaders.⁷ McDonald contends that there are two kinds of people: “driven” people and “called” people. Driven people think they own everything. They own their relationships, they own their possessions, and they own their positions. Driven people are self-serving. Most of their time is spent protecting what they own. They run bureaucracies and believe the sheep are there for the benefit of the shepherd. They want to make sure that all the money, recognition, and power move up the hierarchy and away from the frontline people and the customers. They’re great at creating “duck ponds.”

Called people are very different. They think everything is on loan—their relationships, possessions, and position. Do you know your relationships are on loan? One of the tough things about 9/11 was that some loans got called in early. If you knew you might not see someone important in your life tomorrow, how would you treat that person today? Margie Blanchard has a wise saying: “Keep your I-love-yous up to date.”

Called people understand that possessions are only temporary, too. In tough economic times, a lot of people get uptight about losing their toys. They think “He who dies with the most toys wins.” The reality is, “He who dies with the most toys dies.” It’s great to have nice things when things are going well, but you might have to give up some of them in hard times. Possessions are on loan.

Called leaders also understand that their positions are on loan from all the stakeholders in the organization, particularly the people who report to them. Since called leaders don’t own anything, they figure their role in life is to shepherd everybody and everything that comes their way.

Self-serving leaders give themselves away in two ways. The first is how they receive feedback. Have you ever tried to give feedback to someone up the hierarchy, and that person killed the messenger? If that has ever occurred, you were dealing with a self-serving leader. They hate feedback. Why? Because if you give them any negative feedback, they think you don’t want them to lead anymore. And that’s their worst nightmare, because they are their position. The second giveaway for self-serving leaders is their unwillingness to develop other leaders around them. They fear the potential competition for their leadership position.

Called leaders have servant hearts, and they love feedback. They know the only reason they are leading is to serve, and if anybody has any suggestions on how they can serve better, they want to hear them. They look at feedback as a gift. When they receive feedback, their first response is, “Thank you. That’s really helpful. Can you tell me more? Is there anybody else I should talk to?”

Called leaders also are willing to develop others. They think leadership is not the province of just the formal leaders. To them, leadership should emerge everywhere. Since they believe their role in life is to serve, not to be served, they want to bring out the best in others. If a good leader rises, servant leaders are willing to partner with that person, and even step aside and take a different role if necessary. They thrive on developing others and the belief that individuals with expertise will come forward as needed throughout the organization.

Robert Greenleaf said it well: “The true test of a servant leader is this: Do those around the servant leader become wiser, freer, more autonomous, healthier, and better able themselves to become servant leaders?”⁸

Our ego gets in the way in two ways. One is false pride, when you start thinking more of yourself than you should. That’s when you start pushing and shoving for credit and thinking leadership is about you rather than those who are led. You spend much of your time promoting yourself. Your ego also gets in your way through self-doubt or fear—thinking less of yourself than you should. You are consumed with your own shortcomings and are hard on yourself. You spend a great deal of time protecting yourself. With both false pride and self-doubt, you have a hard time believing you are okay. To borrow the title from an old song, you are “looking for love in all the wrong places.” Now you think that, as Robert S. McGee warns, “your self-worth is a function of your performance plus others’ opinions.”⁹ Since your performance varies from day to day and people are often fickle, with that belief your self-worth is up for grabs every day.

It’s easy to understand that self-doubt comes from lack of self-esteem, because people afflicted with it on a daily basis act as if they are worth less than others. It is less obvious with people who have false pride, because they behave as if they are worth more than others. People with false pride, who act as if they are the only ones who count, are really trying to make up for their lack of self-esteem. They overcompensate for their “not okay” feelings by trying to control everything and everybody around them. In the process, they make themselves unlovable to those around them.

It’s interesting to see how false pride and self-doubt play out in managers. When managers are addicted to either ego affliction, it erodes their effectiveness. Managers dominated by false pride are often called “controllers.” Even when they don’t know what they are doing, they have a high need for power and control. Even when it’s clear to everyone that they are wrong, they keep on insisting they are right. These folks aren’t much for supporting their people, either. If everyone is upbeat and confident, controllers throw out the wet blanket. They support their bosses over their people because they want to climb the hierarchy and be part of the bosses crowd.

At the other end of the spectrum are fear-driven managers, who are often characterized as “do-nothing bosses.” They are described as “never around, always avoiding conflict, and not very helpful.” They often leave people alone even when those people are insecure and don’t know what they are doing. Do-nothing bosses don’t seem to believe in themselves or trust in their own judgment. They value others’ thoughts more than their own—especially the thoughts of those they report to. As a result, they rarely speak out and support their own people. Under pressure, they seem to defer to whoever has the most power.

If any of this sounds a bit too close for comfort, don’t be alarmed. Most of us have traces of both false pride and self-doubt, because the issue is really ego. We are stuck, all alone, focusing only on ourselves. The good news is that there is an antidote for both.

Jim Collins supports this truth in Good to Great.¹⁰ He found two characteristics that describe great leaders: will and humility. Will is the determination to follow through on a vision/mission/goal. Humility is the capacity to realize that leadership is not about the leader; it’s about the people and what they need.

According to Collins, when things are going well for typical self-serving leaders, they look in the mirror, beat their chests, and tell themselves how good they are. When things go wrong, they look out the window and blame everyone else. On the other hand, when things go well for great leaders, they look out the window and give everybody else the credit. When things go wrong, these servant leaders look in the mirror and ask questions like “What could I have done differently that would have allowed these people to be as great as they could be?” That requires real humility.

One of the keys, therefore, to becoming a servant leader is humility. We have found two compelling definitions of humility. The first one appeared in a book by Ken Blanchard and Norman Vincent Peale, The Power of Ethical Management:¹¹

So, people who are humble have solid self-esteem.

The second definition of humility comes from Fred Smith, author of You and Your Network:¹²

Too many people think that who they are is their position and the power it gives them. Yet that’s not true. Where does your power come from? It’s not from your position; it’s from the people whose lives you touch. Most people would like to make the world a better place. But how many actually have a plan for how they will do that? Very few. And yet we all can make the world a better place through the moment-to-moment decisions we make as we interact with the people we come into contact with at work, at home, and in the community.

Suppose as you leave your house one morning, someone yells at you. You have a choice: You can yell back, or you can hug the person and wish her a good day. Someone cuts you off on your way to work. You have a choice: Will you chase him down and give him an obscene gesture, or will you send a prayer toward his car? We have choices all the time as we interact with other human beings. Humility tames your judgmental nature and motivates you to reach out to support and encourage others. That’s where your power comes from.

What’s the antidote for fear? It’s love. Do you have kids? Do you love your kids? Does this love for your kids depend on their success? If they’re successful, you love them; if they’re not, you won’t? Few people would agree with this. You love your kids unconditionally, right? What if you accepted that unconditional love for yourself? You know God doesn’t make junk. He unconditionally loves each one of us. Did you know that you can’t control enough, sell enough, make enough money, or have a high-enough position to get any more love? You have all the love you need. All you have to do is open yourself to it.

S stands for See the Future. This has to do with the visionary role of leaders that we discussed in detail in Chapter 2, “The Power of Vision.” Leadership is about taking people from one place to another. We can’t say enough about the importance of having a compelling vision. Once a clear vision is established, goals and strategies can be developed within the context of the vision.

E stands for Engage and Develop People. That’s what Section III, “Treat Your People Right,” was all about. We took you on a transformational journey from self leadership to one-on-one leadership, to team leadership, to organizational leadership. As a leader, once the vision and direction are set, you have to turn the hierarchical pyramid upside down and focus on engaging and developing your people so that they can live according to the vision. You also must take care of your customers in a way that creates customer maniacs and raving fans.

R stands for Reinvent Continuously. Reinventing continuously has three aspects. First, great leaders reinvent continuously on a personal level. They are always interested in ways to enhance their knowledge and skills. The very best leaders are learners. Great leaders find their own approach to learning—some read, some listen to audio books or downloads, some spend time with mentors. They do whatever it takes to keep learning. We believe if you stop learning, you stop leading. We feel that everyone in every organization, every year, should have at least one learning goal. What do you hope will be on your resume next year that’s not on it this year? For example, maybe you want to learn Spanish this year, since more and more of your customers are Spanish-speaking. You might want to learn some new computer program that will make your life simpler and help you retrieve the information you need to make effective decisions. Whatever it is, focus on learning something new every year.

Leaders must also work to instill the desire for improvement into the people doing the day-to-day work. The leader may champion this cause, but the people make it happen—or not.

The third part of Reinvent Continuously is the idea of structural invention. Many people assume that an organizational structure is permanent. In many cases, the organizational structure no longer serves the business—the people are serving the structure. Great leaders don’t change the structure just to have something to do. They understand that their organizational structure should be fluid and flexible. That belief is key to creating the energizing structures and systems that are characteristic of high performing organizations. Other, less proficient leaders tend to let the structure drive their decisions rather than adapting the structure to meet the business’s ever-changing demands.

Don Shula, the famous NFL coach and coauthor with Ken Blanchard of Everyone’s a Coach, was a great believer in this. He said great teams are “audible-ready.” Suppose a football quarterback calls “halfback right.” When he gets to the line of scrimmage, he sees that the defense is all to the right. He doesn’t turn to the halfback and say, “Hold on; I think they’ll kill you.” He decides to call a new play. Why? Because the structure and what they’ve set up are no longer appropriate. Shula always felt it was important to realize that you don’t call an audible for nothing. It’s good to have a plan; it’s good to have your structure in place. But always be watchful, and determine whether it’s serving you, your customers, and your people well. If it’s not, change it.

V stands for Value Results and Relationships. Great leaders—those who lead at a higher level—value both results and relationships. Both are critical for long-term survival. Not either/or, but both/and. For too long, many leaders have felt that they needed to choose. Most corporate leaders have said it’s all about results. In reality, there are two tests of a leader. First, does he or she get results? Second, does he or she have followers? By the way, if you don’t have followers, it’s very hard to get long-term results.

The way to maximize your results as a leader is to have high expectations for both results and relationships. If leaders can take care of their customers and create a motivating environment for their people, profits and financial strength are the applause they get for a job well done. You see, success is both results and relationships. It’s a proven formula.

E stands for Embody the Values. All genuine leadership is built on trust. Trust can be built in many ways. One way is to live consistently with the values you profess. If I say customers are important, my actions had better support that statement. If I choose to live as if customers are unimportant, people will have reason to question my trustworthiness. In the final analysis, if my people deem me untrustworthy, I will not be trusted—or followed as a leader. Embody the Values is all about walking your talk. The leader, above all, has to be a walking example of the vision. Leaders who say “Do as I say, not as I do” are ineffective in the long run.

The SERVE acronym builds a wonderful picture of how servant leaders operate. But it’s a tough act to follow. Continually doing a good job in each of these areas is a significant task, but it’s worth it. Servant leadership is about getting people to a higher level by leading people at a higher level.

As Blanchard and Zigarmi found in their research, when the “what” (the leadership aspect of servant leadership) gets things started in the right direction and the “how” (the servant part of servant leadership) excites employees and customers, organizational vitality and success are almost guaranteed. If that’s true, why wouldn’t everyone—even self-serving leaders who are focused only on making money or their own power, recognition, and status—want to be servant leaders? Doesn’t servant leadership benefit their motives, too? The answer is yes, but not for long. Self-serving motivations can’t be hidden forever. Your heart will be exposed. As Blanchard and Zigarmi found, there is a direct correlation between bad senior leadership and organizational failure. What happened at Enron, WorldCom, and other companies speaks volumes.

Servant leadership is not just another management technique. It is a way of life for those with servant hearts. In organizations run by servant leaders, servant leadership becomes a mandate, not a choice, and the by-products are better leadership, better service, a higher performing organization, and more success and significance.

Servant leadership provides better leadership. Organizations led by servant leaders are less likely to experience poor leadership. In studying bad leadership, Barbara Gellerman found seven different patterns, falling along a continuum ranging from ineffective to unethical leadership. Ineffective leadership just does not get the job done because of incompetence, rigidity, and lack of self-control or callousness. Unethical leadership, in contrast, is about right and wrong. “Unethical leadership can be effective leadership, just as ineffective leadership can be ethical,” Gellerman states. “But unethical leadership cannot make even the most basic claim to decency and good conduct, and so the leadership process is derailed.”¹⁴

Organizations led by servant leaders ward off unethical leadership. When the vision and values are clearly defined, ethical and moral dilemmas are less likely to emerge. Drea Zigarmi, coauthor of The Leader Within,¹⁵ contends that a moral dilemma exists when no guidelines for decision making exist, forcing an individual to rely on his or her own values and beliefs. An ethical dilemma arises when the organization has clearly established guidelines for behavior and the individual must consciously decide to either go along with or violate those guidelines.

Organizations work more effectively if clear vision and values are established up front, as they are under servant leadership. When unethical leadership occurs, it is often the result of the moral confusion created by the organization’s lack of clearly established guidelines that a compelling vision provides.

Servant leadership provides a cure for ineffectiveness as well. Suppose someone who is unqualified accepts a leadership position. What will it take for this person to become effective and get the job done? The key is humility. True servant leadership embraces a humble sincerity that brings out the best in leaders and those they serve. Because servant leaders have solid self-esteem, they are willing to admit when they have a weakness or need assistance. Put in positions over their heads, they can reach out to their people for help.

We had a beautiful example of this in our own company. Because of a leadership crisis, we needed Debbie Blanchard, one of the owners, to take over our sales department. The only sales experience she had was working at Nordstrom in the summer while in college. When she had her first meeting with all her salespeople, her humility showed through. She told them that she needed their help if she were to be effective. She flew around the country, met with her team, found out what their needs were, and figured out how she could help them. Responding to her humility, the salespeople reached out to make sure she had the knowledge she needed to be effective. With Debbie at the helm, the sales department has produced the highest sales in the history of the company, far exceeding its annual goals.

Servant leadership provides better service. Organizations led by servant leaders are more likely to take better care of their customers. As we’ve pointed out, if you don’t take care of your customers today, somebody is waiting, ready and willing to do it. Again, the only thing your competition can’t steal from you is the relationship your people have with your customers. Under servant leadership these relationships can really grow, because the people closest to the customer are given the power to soar like eagles rather than quack like ducks. As we pointed out in Chapter 3, the great customer service experiences created by Southwest Airlines and the Ritz-Carlton were a direct result of servant leadership. Leaders like Herb Kelleher and Horst Shultze set up their organizations to empower everyone—including the frontline people—to make decisions, use their brains, and be servant leaders who could carry out the vision of high-quality customer service.

Servant leadership helps create a high performing organization. When we discussed HPO SCORES in Chapter 1, we said that if becoming a high performing organization is the destination, leadership is the engine. And the kind of leadership we want is servant leadership. The one HPO SCORES element that best characterizes a servant leader is Shared Power and High Involvement. It goes hand in hand with leaders who realize it’s not about them.

Is being a servant leader just about being nice for the sake of niceness? No—it works. Practicing shared power and high involvement strongly impacts financial results through productivity, retention, and employee satisfaction. Using U.S. Department of Labor data and surveys of over 1,500 firms from various industries, Huselid and Becker found that such participative practices significantly improved employee retention and financial performance and increased productivity. In fact, they were able to quantify the financial impact of participative practices with enough confidence to say that each standard deviation in the use of participative practices increased a company’s market value between $35,000 and $78,000 per employee.¹⁶

The servant leaders in high performing organizations understand that day-to-day decision making should occur closest to the action and on the front lines by those directly involved with the customer. Being involved in decisions that affect their lives reduces people’s stress and creates a healthier, happier workforce. Involvement in decision making increases their ownership and commitment as well as effectiveness.

For example, Chaparral Steel does not use quality inspectors. The people in their plants are responsible for the products they produce and the quality of those products. Given the power and responsibility for decision making, they act as they are expected to: as owners.

Servant leaders in high performing organizations involve their people at all levels and from multiple areas of the business in complex and strategic decision making. Research demonstrates that decisions and action plans are more effective when people whose commitment is required are part of the planning.¹⁷ Effectiveness increases in quality, quantity, and implementation. These kinds of decisions are often made in a team environment where everyone involved is in the room at the same time, able to benefit from and react to each other’s thinking and to arrive at “collective wisdom.” W.L. Gore, a company whose watchwords are “commitment, empowerment, and innovation,” recognizes the importance of personal contact. Gore even goes so far as to limit the size of its facilities. They will build a new plant rather than expand one where associates would lose contact with each other.

High performing organizations do not depend on a few peak performers to guide and direct, but have broadly developed leadership capacities. This allows for self-management, ownership, and the power to act quickly as the situation requires. Pushing decision making to those closest to the action is an empowering practice. Servant leaders in high performing organizations create environments where people are free to choose to empower themselves.

The benefit of shifting power from top management leaders to the people closest to the action is illustrated by the journey of Summit Pointe, a large state and locally funded behavioral health organization. Eunice Parisi-Carew, one of the HPO SCORES researchers, had the opportunity to collaborate with Erv Brinker, the CEO—a wonderful example of a servant leader. When Erv took his position, he determined that it was critical to share the power concentrated at the top. He decided to allow those involved on the front lines to make decisions that impacted their lives and the service they provided. His first step was to hire Dev Ogle, a talented senior consultant, to act as his guide. Dev began by training his senior leaders using an approach that emphasized the importance of sharing leadership and power. Brinker’s expectation was that the senior leaders would act as models as he moved the organization from a hierarchical to a team-based culture. The journey was successful. Summit Pointe is now an organization that supports team performance. For example, each team sets its own performance standards, monitors its progress, and receives pay incentives based on its accomplishments. They use a “pay-for-performance” approach to compensation. Now that they are in control, teams are actually setting higher goals for themselves than had previously been set for them. A collection of both hard and soft data revealed the exceptional results of servant leadership:

• Administrative overhead has been reduced significantly while the number of customers served has increased: It went from 230 staff serving 2,000 customers per year to 100 staff serving 8,000 customers with a $1.5 million cost savings.

• New services such as prevention have been added, with increased revenue of $5 million.

• Communication across departments has increased dramatically.

• Employee morale has increased, and the isolation that is common in this stressful field has decreased dramatically.

• Whereas the industry average for turnover is 29 percent, Summit Pointe has averaged 9 percent.

Servant leaders think differently than self-serving leaders. It is not possible to share power without believing that people can and will manage power and decision making responsibly if given the proper training, information, and opportunity. It is also not possible to create a high involvement culture without including everyone. Servant leaders in high performing organizations not only appreciate but capitalize on cultural diversity; style diversity; social diversity; and diversity in race, religion, sexual orientation, and age. They realize that effective decision making, problem solving, and innovation come from utilizing different perspectives.

Servant leadership brings more success and significance. In his classic book Halftime, Bob Buford reveals that most people, later in life, want to move from success to significance—from getting to giving.¹⁸ Organizations led by servant leaders are more likely to create environments where people at all levels can experience both success and significance.

Too many leaders today focus only on success. They think success depends only on how much wealth they have accumulated, the amount of recognition they have received, and their power and status. Nothing is inherently wrong with any of those things, as long as you don’t identify those things as who you are. As an alternative, we’d like you to focus on the opposite of each of those as you move from success to significance. What’s the opposite of accumulating wealth? It’s generosity of time, talent, treasure, and touch (reaching out to support others). What’s the opposite of recognition? It’s service. What’s the opposite of power and status? It’s loving relationships.

We’ve found over the years that when you focus only on success, you will never reach significance. That’s the problem with self-serving leaders—they never get out of their own way. On the other hand, if you focus on significance—generosity, service, and loving relationships—you’ll be amazed at how much success will come your way. Take Mother Teresa. She couldn’t have cared less about accumulating wealth, recognition, and status. Her whole life was focused on significance. And what happened? Success came her way. Her ministry received tremendous financial backing, she was recognized all over the world, and she was given the highest status wherever she went. She was the ultimate servant leader. If you focus on significance first, your emphasis will be on people. Through that emphasis, success and results will follow.

An amazing story of significance occurred during the 100-yard dash at the Special Olympics several years ago in Spokane, Washington. Nine contestants waited anxiously for the starting gun to fire. When it did, they raced toward the finish line as fast as they could, given their physical disabilities. About a third of the way down the track, one of the boys fell. He tried to get up, but he fell again. In frustration, he lay on the track, sobbing. While six of the other racers continued to push toward the finish line and possible victory, two of the youngsters, hearing the sobs of their opponent, stopped, turned around, headed back toward their fallen competitor, and helped him up. The three boys held hands, walked down the track, and crossed the finish line together, well after the others had finished the race. The crowd was surprised. When they realized what had happened, they rose in unison and gave these youngsters a longer and louder ovation than they’d given the winner of the race.

Life is all about the choices we make as we interact with each other. We can choose to be self-serving or serving. Most of the youngsters in the race chose to focus on their own success—victory—but two tossed aside their dreams in favor of serving someone else. The crowd responded with enthusiasm, because we all yearn to live at a higher level, and these young people modeled what that means. They made a different choice—they were true servant leaders.

We hope you make these kinds of choices. Life constantly presents leaders with opportunities to choose to love and serve one another. Someone once said to Margie Blanchard, “You’ve lived with Ken for almost 45 years. What do you think leadership is all about?” She said:

She continued, “It is loving your mission, it’s loving your customers, it’s loving your people, and it’s loving yourself enough to get out of the way so that other people can be magnificent.”

That’s what leading at a higher level is all about.