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Chapter 2

LEVEL 5 LEADERSHIP
“You can accomplish
anything in life,
provided that you do
not mind who gets
the credit”

- Harry S. Truman -
• Level 5 Leaders: channel their ego needs away from themselves and into the larger goal of
building a great company
• Incredibly ambitious – but their ambitious is first and foremost for the institution, not
themselves
The term Level 5 refers to
the highest level in a
hierarchy of executive
capabilities
• Not a “servant leader” or
“selfless executive” because
those characteristics sound weak
• The key to be great
• Fully developed Level 5 leaders
embody all five layers of the
pyramid

Level 5 Hierarchy (Pyramid)


Level 5 vs Level 4
• Level 5 leaders set up their
successor for even greater
success in the next
generation. One of them said,
“I want to look out from my
porch at one of the great
companies in the world
someday and be able to say, ‘I
used to work there’.”
• Egocentric Level 4 leaders
often set up their successor
for failure. E.g. Stanley Gault
(Rubbermaid)
• In 312 articles collected. The
word “I” appeared 44 times,
and “We” appeared 16 times.
• Rubbermaid fell apart after
Gault.
Level 5 Hierarchy (Pyramid)
Humility + Will = Level 5

• A study in duality: Modest and willful, humble and fearless.

• Modesty, shy nature, awkward manner.

• Not the signs of weakness.

• Never let his ego get in the way of his primary


ambition for the larger cause of an enduring great
nation.

Abraham Lincoln
The Two Sides of Level 5 Leadership

Professional Will Personal Humility


• Creates superb results, a clear catalyst in the • Modest, never boastful.
transition from good to great.
• Acts with quiet, calm. Relies principally on
• Demonstrates an unwavering resolve to do inspired standards, not inspiring charisma.
whatever must be done to produce the best
long-term results, no matter how difficult.
• Channels ambition into the company, not the
self; Sets up successors for even greater
• Sets standards for building an enduring great success in the next generation.
company.
Level 5 Leaders’ Traits
• David Maxwell (Fannie Mae), Darwin Smith (Kimberly Clark),
and Colman Mockler (Gillette) exemplify a key trait of level 5
Leaders:
• Ambition for the company and concern for its success rather than one’s
own riches and personal renown.
• They think not in terms of “I” but “We”
Mirror and Window Analogy
 When things are going well, these leaders look outside of the
window and attribute the success to other outside factors
(the organization, luck, employees, etc).
 When things do not go well, these leaders look in the mirror
to credit responsibility, never bad luck
Level 5 Leaders’ Traits
• During interview, they didn’t talk about themselves.
When pressed to talk about themselves, they’d say
things like:
• “I hope I’m not sounding like a big shot”
• ”If the board hadn’t picked such great successors, you
probably wouldn’t be talking with me today”
• “There are plenty of people in this company who could do my
job better than I do”
Level 5 Leaders’ Traits

• Quiet • Understated
• Humble • Mild-mannered
• Modest • Self-Effacing
• Reserved • Didn’t believe his
own clippings
• Shy
• Gracious • And so forth..
Unexpected findings

• You do not need an outsider to come in and save the day with their
leadership:
• Celebrity leaders who ride in from the outside are negatively correlated with going from
good to great. Ten out of eleven good to great CEOs came from inside the company,
whereas the comparison companies tried outside CEOs six time more often.

• L5 Leaders attribute much of their success to good luck, rather than


personal greatness.
Thank you