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Study: Humble CEOs Good for Business

Forget the stereotypes of arrogant, macho leaders who don’t care about anyone else’s opinion. A new study from the W. P. Carey School of Business at Arizona State University shows humble CEOs significantly benefit a company and its management — likely more than the blowhards who think it’s their way or the highway.

“Humble CEOs are more open to making joint decisions and empowering others,” says Professor Angelo Kinicki of the W. P. Carey School of Business, one of the study authors. “Their behavior positively affects both top and middle managers, who then exhibit higher commitment, work engagement, job satisfaction and job performance. We see a trickle-down effect that seems to influence the company overall.”

The new research published in Administrative Science Quarterly comes from Kinicki, Anne Tsui and David Waldman of the W. P. Carey School of Business, as well Amy Ou of the National University of Singapore, Zhixing Xiao of George Washington University, and Lynda Jiwen Song of the Renmin University of China.

They interviewed the CEOs of 63 private companies in China. They also created and administered surveys measuring humility and its effects to about 1,000 top- and middle-level managers who work with those CEOs. The researchers specifically chose China because they needed a context in which CEOs would display a wide variety of humility levels. However, they believe the findings will generalize to many companies in the United States.

“Our study suggests the ‘secret sauce’ of great, humble managers,” explains Kinicki. “They are more willing to seek feedback about themselves, more empathetic and appreciative of others’ strengths and weaknesses, and more focused on the greater good and others’ welfare than on themselves.”

Kinicki says leadership behavior normally cascades downward, so it’s likely humility at the top effects just about everyone at a company. He points out a few examples of humble CEOs making news:

* Tony Hsieh of Zappos is a Harvard graduate, who helped boost his company to more than $1 billion in gross merchandise sales annually. He also helped drive Zappos onto Fortune’s “100 Best Companies to Work For” list, with innovative customer- and employee-pleasing policies, such as “The Offer,” where new employees are offered one-month’s salary to leave the company if they’re not dedicated and happy.

* John Mackey of Whole Foods has shown concern for the greater good through his advocacy of organic food and spearheading his company’s move to become the first grocery-store chain to set standards for humane animal treatment. He also announced in 2006 that he was chopping his salary to $1, putting caps on executive pay, and setting up a $100,000 emergency fund for staff facing personal problems.

* Mary Barra of General Motors has faced severe criticism for problems created at the company before she took the helm in January. However, she has been quick to apologize and maintain that she’s moving from a “cost culture” to a “customer culture” at GM. She has promised to do “the right thing” for those affected by recent recalls and the problems that led to them.

Kinicki knows some people may be surprised by the study results, but he summarizes, “It’s time we understood that humility isn’t a sign of weakness or lacking confidence, but rather, a good thing that can benefit us all.”

The full study is available at http://asq.sagepub.com/content/59/1/34.full.pdf+html.

Meeting Professionals International, AZ Business Magazine September/October 2011

Face-To-Face Meetings Are Still Relevant, Despite Technology

Face-to-face meetings are back: Despite teleconferencing and technology, study shows meetings that provide human contact — face-to-face meetings — are still relevant.

As technology provides businesses with cost-effective means for communication with cloud technology, smart phones and Skype, one element among these virtual options will never be outdated — human contact.

MPI, Photos: Courtesy of MPI Arizona and Mark Skalny

Sure you can conduct a business meeting with your staff convened in a conference room to other parts of the country via teleconferencing. But meeting face-to-face is as personal — and effective — as you can get.

Dirk Smith, president and founder of Sports Destination, Inc., says face-to-face meetings haven’t fallen out style. “They might have fallen out of favor because of the economy,” he adds.

Jen Merkel, operations manager for CMI Resources, says she’s seen some scaling back in meetings, but lately, “in general, our clients seem to be back booking like they always have.”

In the white paper, “Why Face-to-Face Business Meeting Matter,” by Richard D. Arvey, professor at the Business School, National University of Singapore, it states that while business attributes 84 percent of communication to emails, teleconferences and other technology, meetings that provide human contact are still relevant.

Arvey states that physical meetings provide people with a way to build trust, figure out social norms, develop social identities and engage with each other. It also provides better business outcomes, with more negative outcomes associated with virtual meetings. Offsite meetings at hotels were surveyed to be 94 percent productive.MPI, Photos: Courtesy of MPI Arizona and Mark Skalny

“Technology makes it possible to connect with people from your own office, couch or pool deck, but when was the last time you made a new contact that way?” Merkel questions. “When a person attends a conference, they meet new people and have new experiences that are so much more than just looking at a laptop screen. Face-to-face conferences are far more enriching than virtual ones.”

In making efforts to be in the same physical space as other colleagues, co-workers or clients, “there is a perceived value in making the effort to physically meet,” Smith says. “Also, if you want to show off a product, to touch or feel something has intrinsic value for people. You can’t get that from a picture. People need to experience the value of interaction.”

Face-to-face meetings are important, but human interaction can sometimes create more complicated situations. Smith says face-to-face meetings tend to fail when there are no agendas, clear goals, important information, entertainment, or way to meet other people.

Merkel says he believes if your speaker isn’t engaging or meet the audience’s expectations — then attendees walk away with feeling they’ve wasted their time. One way to combat this is to ask audiences questions addressing these areas after meetings.

Another way is  to “listen to your planners,” Merkel adds. “They want the meeting to be as successful as you do, try to give them a little free reign to get creative and shake things up.”

Avery concludes in his paper that while teleconferencing and other virtual elements may be used by business, the key is to figure out the balance of virtual and face-to-face for creating a successful workforce.

[stextbox id=”grey”]Check back next Friday, September 16, to read what Meeting Professionals International members had to say about the importance of face-to-face meetings.[/stextbox]


Arizona Business Magazine September/October 2011