Long time GE-observer and acknowledged leadership maven Noel Tichy speaks to BT's Dilip Maitra during a quick visit to India.

Q. Mr Tichy, you've been associated with GE for quite some time. Everyone speaks of how (Jack) Welch is such a great leader. In your opinion, what is the one thing that makes him so?

A. The most significant aspect of Welch that makes him a great leader is his commitment to developing leaders at all levels of the organisation, and the amount of time and energy he is willing to spend in teaching and developing other leaders. Sixty per cent of his calendar is spent in leadership (initiatives); he visits the management development centre at Crotonville regularly; several times a month he goes out to every single business of GE's 12 businesses; he attends 12-to-16 hour succession-plan meetings for every single business; and he regularly coaches the senior managers.

Unlike many other CEOs who do not find time for all these, Welch's major focus is (on) building leadership. No wonder GE is one of the most successful companies in the world, with a $400-billion market capitalisation. It has 340,000 people, and is diversified with products ranging from jet engines to medical imaging. But somehow Jack finds the time. So, it's not about time; it's about priorities.

That suggests that great leaders can create leaders or clone themselves...

You start with two commitments: developing leadership is your competitive advantage, and it is your personal responsibility to develop leaders for the next generation. I believe the biggest failure of any organisation is the failure to develop the next generation (of leaders).

In the United States, in the last decade there have been some striking failures: IBM, Kodak, Merc, hp, and 3m. All had to go outside to pick up the next-generation CEO. All these supposedly great companies failed to develop their next generation of leadership.

Fine, Jack is a great leader because he fosters leadership. What are the other qualities of a good leader?

Leaders are people who accomplish things through others. They do it in today's world by changing people's mindsets; by energising them. The heart of leadership is an understanding of the fact that one critical role of the leader is to take a set of assets-people, information, and technology-and make them more valuable for tomorrow.

As we move more towards the knowledge economy, leadership is all about making your organisation smarter tomorrow than it is today. That drives home the fact that you have to be a teacher. Teaching isn't one-way; it also involves learning from other people so that everybody gets smarter.

Becoming a world-class leader requires the ability to master revolutionary change. It requires taking on the challenge of creatively destroying and remaking organisations in order to improve them. Not just once but repeatedly. Implementation of a massive organisational change is the hardest part. (The) Implementation of an idea requires values, emotional energy, and the guts to see it through to the end. Leaders will have to shape people's opinions and win their enthusiasm, using every available opportunity to send out their message.

At the core of it all is what makes a great leader today very different from what made a great leader, say, five centuries ago?

I do not think the basic qualities have changed. I think the fundamental principles are the same and great leaders have always had some of these characteristics.

What is changing in the 21st century is that more and more institutions are operating in the knowledge economy. In the past, where corporations were highly capital intensive you could get away without managing your people that well. But today you just cannot ignore your people.

Can someone work on acquiring all the things you've just spoken about? Or are great leaders born, not made?

Not at all. I have a very simple thesis: all people have untapped leadership potential, just as all people have untapped athletic potential. There are clear differences due to nature and nurture-genes and development-as to how much untapped potential there may be. But no matter what level of athletic or leadership performance a person currently exhibits, he or she can make quantum improvements. Not everyone can be the chief executive of a multi-billion dollar corporation, just as not everyone can be an Olympian or win at Wimbledon, but with coaching and practice, we can be a lot better than we are at present. The important teaching point is that leadership is there in you and it needs to be developed.

But, you will also need to ensure that there's an organisational atmosphere that is able to nurture leadership and initiative...

The first thing is the mindset of the top management; they have got to believe that there is leadership capability in every human being, and leaders at all levels. The essence (of this attitude) is the commitment that ''we are going to have leaders at all levels, we are going to take responsibility (for this), and, we are not going to hire consultants to build leaders. That's our job.''

So it becomes a part of the DNA of the company. You also need an environment where there is dignity and respect for the individual and people are pushed to be as good as they can be.

It is also an environment where not everyone makes it; where you may yourself choose to withdraw or the organisation can say that you are not meeting the standards. Some high performance organisations tend to lose some of their younger people. McKinsey, the consulting firm, has made it clear for years that only a small percentage-not more than 20 per cent of its employees-will make it to partner. But young MBAs still join them in large numbers.

Suppose a company does all this and develops leaders successfully. Will that help it pre-empt crisis and take corrective measures before a crisis hits them?

Yes, if these are leadership development programmes built around action learning where you are using the problems of organisations and engaging people to solve these problems. One example of that would be a programme run by Ford Motor Company where the CEO Jack Nasser and his team pick three or four strategic problems facing the company and (then) get their highest-potential middle managers to solve them.

Do great leaders have to be necessarily liked by everyone in their organisations?

Not all the time. I started my book on General Electric, Control your Destiny Or Someone Else Will, with a quote from a workshop being run in GE's management development centre, ''Jack Welch is the greatest CEO GE ever had and Jack Welch is an asshole.'' I used that quote because it came from the people within the company. Great leaders do not win popularity contests. Martin Luther King and Gandhi were killed for their beliefs. Leadership is not about just being popular.

You have always been a proponent of the teaching organisation, as against the learning one...

Learning is necessary, but not enough. In a teaching organisation if I learn something useful I feel responsible to take it to other people; by transmitting my learning to others I am enhancing the overall knowledge of the organisation. One of the best examples (I've come across and I've) used (this) in a book is navy officers in charge of the special operation forces of the United States who, when they learn something they believe useful, immediately teach all their team members.

Do we need to work on acquiring something special to be able to teach?

The most important point in teaching is to have a teachable point of view. To develop teachable points of view, leaders think about their experiences, draw lessons from what they know, and then figure out how to share these lessons with others. So leadership is more about thinking, judging, acting, and motivating than about strategies, methodologies, and tools. Good leaders develop teachable points of view that help others learn to think, judge, act, and motivate.

You have said that business is best understood not by Powerpoint slides but by stories. That great leaders master the art of understanding, telling, and reshaping three important stories: 'Who Am I, Who Are We, and Where Are We Going'

The concept comes from a psychologist named Howard Gardner who in his book Leading Mind looked at a number of leaders like Martin Luther King, Oppenheimer, Gandhi, and Einstein... What distinguishes these leaders from others is that they lead through stories.

One is 'Who Am I', the story of the leader, his values, life, and beliefs. The next, 'Who Are We', is about the identity of the organisation today. Until you tell this story, there may be no identity, or there may well be an identity that undercuts success and resists change. The third, 'Where Are We Going', is the most important story of all-that of the hopes and dreams that you together will make come true. There is a famous Martin Luther speech 'I have a dream', which is a perfect example of the 'Where Are We Going' story. These three stories are particularly important for managers in corporations because they tend to be dependent on PowerPoint presentations that do not motivate people.

What is the best external measure of leadership? Is it market capitalisation, or do we have to look at something else?

There are actually three inter-related things you have to look at. Clearly, shareholder value measured through market capitalisation is one thing you will have to look at in the long haul. But there is a triangle-employees, shareholders, and customers-and you have to maximise value for all three. You have to strike a balance of the three.

Till about a year ago, most people considered Tim Koogle (of Yahoo!) and Jeff Bezos (of Amazon) as among the greatest CEOs of their time. Today, with their companies losing market value, they are fallen heroes. What's your take? Were they good leaders?

If you had asked me the same question a year ago, my answer would have been 'they are not'. Not because they were bad leaders, either. Clearly there was a rising tide in the internet bubble that phenomenally raised their market value. But it was too early to tell if they were good leaders. They were probably lucky leaders at that point of time. The people I consider good leaders in the hi-tech world are John Chambers (Cisco), Scot McNealy (Sun), and Michael Dell (Dell Computers). Then there are a quite a few smaller CEOs who are doing an excellent job. The ultimate test is, who is able deliver value to his shareholders, customers, and employees consistently.

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