Blackbelt Final Module 2010 Fall

Fall 2010 Blackbelt Class Graduation

After 3 months of challenging work, our Fall 2010 Blackbelt class has finally completed their 4 modules and gradudated from North America's most respected certification program!  Congratulations to all.

Complete photo album below:

Blackbelt Final Week!

Our Blackbelt Certification class is finally reaching its fourth module, to be completed this week!  The group just completed a challenging "extreme makeover" assignment at a growing telecommunications company and is ready to do their final presentation today.

We will be uploading more information today and tomorrow. Please stay tuned.

Global Innovation

The Global Innovation 1000

Every year since 2005, Booz & Company has conducted the Global Innovation 1000 study, which investigates the relationship between how much companies spend on R&D and their overall financial performance. And every year, we reinforce the conclusion that there is no correlation between the two. Our findings and further analysis of what makes the most successful innovators great led The Economist to call the Global Innovation 1000 "the most comprehensive assessment of the relationship between R&D investment and corporate performance," and Tom Peters praised it as a "provocative, research-based article that is sure to get you thinking."

Since its inception, the study has been mentioned in more than 150 publications in 27 countries, including The New York Times, The Wall Street Journal and the Financial Times. In 2007, we received the Special Achievement Award for Advancing the Innovation Dialog from Innovate Forum, and in 2008 the Product Development & Management Association presented us with its Best of Visions award. And we were privileged to present the study’s results to the National Academy of Sciences & Engineering.

Since its inception, the study has included an analysis of corporate R&D by industry — the healthcare and software & internet sectors consistently spend the greatest proportion of their sales on R&D — and on global trends in innovation. Over the years, we have expanded the scope of the study to include critical issues such as the importance of customer-driven innovation and the recession's effect on R&D spending. Every year, the study has produced quantifiable insights and invaluable lessons for helping companies make more productive use of the R&D dollars they spend.

2010: How the Top Innovators Keep Winning

Succeeding at innovation requires two key elements: a focused set of innovation capabilities that is carefully tuned to a company’s innovation strategy, and the ability to align the innovation strategy with overall corporate strategy. This year’s Global Innovation 1000 reveals the capabilities best suited for each innovation strategy, whether it be need seekers, market readers, or technology drivers. Companies that achieve this, and then succeed in aligning their R&D efforts with overall strategy outperform their industry peers in terms of both profit margins and market capitalization growth.

To download the actual study in PDF, please click below:

Global Innovation 1000

Latest JD Power Report on Customer Retention

J.D. Power and Associates Reports:
Desire for a Fun Driving Experience Increases in Importance as a Reason for Brand Loyalty, While Expected Resale Value Becomes Less Important

Ford and Honda Each Rank Highest in Owner Retention, in a Tie

WESTLAKE VILLAGE, Calif.: 9 December 2010 - New-vehicle owners are increasingly citing fun-to-drive vehicles as a top reason to remain loyal to their brand, while shifting away from expected resale value as a loyalty reason, according to the J.D. Power and Associates 2010 Customer Retention Study released today.

Now in its eighth year, the study measures the rate at which automotive brands retain their existing customers and the reasons why owners remain loyal. Customer retention is critical to a brand's market success, particularly during the current period of slow recovery, in which each new-vehicle sale is vital.

The study finds that the importance of fun-to-drive vehicles as a reason for owner loyalty has increased by eight percentage points in 2010, compared with 2009. Meanwhile, the importance of resale value as a reason to stay loyal has decreased by 10 percentage points from 2009.

In addition to customer retention, the study also examines rates at which automotive brands capture customers from their competitors, known as conquesting. The importance of a fun-to-drive vehicle has also increased as a reason why brands conquest new customers from their competitors, as has vehicle styling.

"Now that economic and market conditions have improved somewhat, vehicle owners are increasingly citing emotional, rather than practical, reasons for staying with their vehicle brand or switching to a different one," said Raffi Festekjian, director of automotive product research at J.D. Power and Associates. "In light of this, developing new models with attractive styling and that are perceived as fun to drive is increasingly critical for automakers in order to retain and conquest customers as the market continues to recover."

Ford and Honda rank highest in a tie among automotive brands in retaining vehicle owners. Each brand retains 62 percent of owners. Ford's retention rate is primarily driven by the Edge, F-Series and Fusion models, while for Honda, retention is driven by the Accord, CR-V and Pilot. Comparing the two brands, Ford owners are more likely than are Honda owners to indicate they have remained with their brand due to the perception that their new vehicle is fun to drive or has good styling. Honda owners are more likely than Ford owners to cite resale value and safety as reasons for repurchasing the brand.

Following Ford and Honda in the rankings are Hyundai, Lexus and Toyota, in a three-way tie, each with a customer retention rate of 60 percent. Kia posts the greatest improvement in customer retention rate from 2009, improving by 21 percentage points to 58 percent in 2010.

Overall customer retention has remained stable from 2009 at 48 percent. In 2010, 16 of the 34 ranked brands have improved their customer retention rates from 2009, while 14 have declined and four have remained flat.

The study finds that customer retention among domestic brands, as a whole, has improved slightly from 2009. In 2010, 69 percent of owners who traded in a vehicle from a domestic brand purchased another domestic vehicle, compared with 68 percent in 2009. However, retention rates among domestic brands continue to lag behind those of import brands. In 2010, 90 percent of owners who traded in a vehicle from an import brand purchased another import vehicle-a level that has remained consistently high during recent years.

Compared with their retention rates, domestic brands have made more substantial progress during the past two years in conquesting customers from import brands. In 2010, 14 percent of buyers of domestic brand vehicles previously owned an import, up from 10 percent in 2008.

"While import brands still have notably higher customer conquest rates than domestic brands, the gap is beginning to narrow," said Festekjian. "In recent years, domestic brands have achieved parity or even surpassed the performance of import brands in initial quality and new-vehicle appeal, and customer perceptions of these nameplates seem to be evolving accordingly. It will be interesting to see how the performance gains by domestic brands affect retention and conquest rates in the coming years."

The 2010 Customer Retention Study is based on responses from 123,601 new-vehicle buyers and lessees, of which 81,350 replaced a vehicle that was previously acquired new. The study was fielded between February and May and August and October 2010.

Christmas Wishes

Here's a wish from LSI support staff!  Enjoy!

Manitoba Greenbelt Graduation

We are proud to graduate 22 people from the Greenbelt program in Winnipeg, Manitoba.  In partnership with CME Manitoba (Canadian Manufacturers & Exporters), we have been offering Greenbelt in central Canada for the past several years with much success.

CME and LSI haven been working together on numerous projects in Manitoba and we are excited to continue offering a variety of lean programs in Manitoba in 2011 and beyond.

Lean Blackbelt Program

Our most advanced lean certification program is the Blackbelt program, in which participants learn "leading edge" lean materials designed to create world-class lean leaders.
Constantly updated since its launch in 2002, LSI's Blackbelt is the most respected lean program in North America and is now considered the standard in this industry. Unlike other classroom based courses, LSI's Blackbelt focus 80% of its materials on hands-on kaizen and strategy development.  Furthermore, the Blackbelt program includes the benchmark trip to Japan - the only Blackbelt in the world which includes such a trip.
Our next Blackbelt program starts in September, 2011, with a trip to Japan scheduled for November of 2011.  Please contact us for further details (click below to see our youtube video on Blackbelt).

Christmas Wishes from LSI

It's hard to believe but Christmas is just around the corner....here's LSI Coaches' Christmas Wish for you!

Canada and Vancouver

After Travelling to: Sydney, San Diego, Los Angeles, Bentenville, Seattle, San Francisco, San Jose, Portland, Baltimore, Washington DC, Virginia, Boston, Toronto, Calgary, Winnipeg, Shanghai, Kuala Lumpur Malaysia, Singapore, Kyoto, Yokohama, Osaka, Nara, Tokyo, Frankfurt Germany, Munich, Rome, London UK, Paris, Belgium, and of course Vancouver all in the last 12 months or so....I come to the same conclusion over and over again. Canada is the Best Country in the world and Vancouver is the Best Place to live!!

Thank you Malaysia Team!

We just wrapped up another important executive program with the Johnson & Johnson team in Malaysia. We want to thank the entire team for their great effort and for producing amazing results!  We were excited to be a part of their session and hope that the Lean Problem Solving methodology will help them solve more issues in the future.  It's been one of the most engaging and exciting teams we've ever had!

Thank you once again.

Congratulations Calgary Greenbelt

Calgary had quite the freeze early last week, and getting around was quite a challenge. But despite the challenges, we are very proud to announce that everyone in our Calgary Greenbelt Class of 2010 Fall graduated to obtain their Lean Greenbelt Certification.


Congratulations to you all!
(sorry that we don't have a group photo!)

Thank you Singapore

A big "thank you" to the entire Johnson & Johnson team in Singapore this week as we successfully completed a comprehensive Lean Problem Solving Executive workshop.  Designed to immerse them into an advanced form of problem solving called LPS by Lean Sensei, the session brought new challenges to the participants.  Superb coordination by the local team helped to make this session a true success.

LSI in Singapore - MONSOON

Soon after Japan, LSI is now in Singapore conducting an Executive workshop on Lean Problem Solving.  However, on our first day we hit a "monsoon"!  Wow, I never realized that rain can hit ground so hard and so fast...

Fall Japan 2010 - Best Photos

Japan is famous for beautiful fall colors.... here are some of the best shots I took while visiting Kyoto.  Our next Japan Lean Tour is March of 2011, hope you can join us!

Complete set below (click):

Story Telling

Using stories to inspire

Think about this for a minute, because it may happen more often than you think. How many times have you stayed up late reading a novel that you "couldn't" put down, or watching a movie that you couldn't turn off? How many times have you pushed yourself harder after hearing the story of someone else's success, or changed your opinion after reading a convincing article in a magazine or newspaper?

There's no doubt that stories can change the way we think, act, and feel. Leaders, especially, can use the power of a good story to influence and motivate their teams to new heights. Stories can inspire everything from understanding to action. They can create legends that an entire workplace culture can build upon, and they have the power to break down barriers and turn a bad situation into a good one. Stories can capture our imaginations and make things real in a way that cold, hard facts can't.

Make no mistake - stories can be very, very powerful leadership tools. Great leaders know this, and many top CEOs today use stories to illustrate points and sell their ideas.

So, do you want to be a persuasive motivator? If so, learn how to tell a good story. But how? When should you tell a story, and how do you know what kind of story to tell to get the results you want? This article summarizes an Interview with Annette Simmons, author of "Whoever Tells the Best Story Wins."

Types of Stories

Learn what kind of story to tell for different situations. There are six main types of story that you can use in the workplace:

1. "Who I Am" Stories - When you start leading a team, members of your new team sometimes make automatic judgments about who you are. They may see you as controlling, mean, or "out to get them" without really knowing you. If you tell a "Who I Am" story when you first become a team leader, you can give a powerful insight into what really motivates you. This can break down walls and help your team realize that you're a person just like them.

Your goal with a "Who I Am" story should be to reveal some type of flaw about yourself or mistake that you've made. Why? Because by revealing a flaw, you show your team that you trust them with this information. Revealing flaws can also make you more approachable, because it demonstrates that you're only human. (Just make sure it's a small flaw!)

For example, the author often finds that when clients first meet her, they assume that her primary goal is to sell them copies of her book or more consulting time. She gets past this by explaining that her dad was a social worker who wanted her to help others (while also being her own boss) and so felt she should go to law school. She was so determined not to do this, that she moved to Australia. This story has the double benefit of emphasizing that she didn't grow up in privileged circumstances, and so actually has a background similar to that of many of her clients, and also that she might sometimes make slightly foolish decisions. After all, emigrating to another continent is a rather extreme way of getting out of going to law school!

2. "Why I'm Here" Stories - These are very similar to "Who I Am" stories. The goal is to replace suspicion with trust, and help your team realize that you don't have any hidden agendas. Show that you're a good person, and that you want to work together with them to achieve a common goal.

For example, a new member of the school board was appointed to the sub-committee responsible for the head teacher's performance management. In their first meeting, which looked at whether the head had met her stated objectives in the past year, the new member challenged the Head on several aspects of the proof presented. After the meeting, the new board member approached the Head, and explained "I'm sure you realize that my challenges are not personal. And I think you're doing great work. However, my duty as a board member is to ensure that the city's education budget is being spent wisely, and so it's my job to ensure that bonuses are only paid when there's a real justification for doing so." The Head reassured her that she understood this perfectly, and was, in fact, grateful for the rigor she had brought to the process.

3. Teaching Stories - It can be very hard to teach without demonstrating, and that's the whole purpose of Teaching Stories.

There's no better example of this than Aesop's fables. Remember "The Boy Who Cried Wolf"? This story alone has taught millions of children not to yell for help unless there's a real need for it. Although it's simple, like most fables, it's done an effective job for centuries.

Use Teaching Stories to make a lesson clear and to help people remember why they're doing something in the first place.

The author tells a more recent example to emphasize the value of teaching stories. She was working with a nation wide chain of care homes for the elderly. Many of the staff in these homes are young and, with the best intentions, often use tones of voice that are more suitable for addressing young children than elderly people. The challenge was to get these young staff to remember to use respectful tones of voice. She achieved this by telling the story of her own grandmother, who suffered a stroke and was unable to speak. After some months, she gave up eating because she had decided she would rather die than live without dignity, because of the patronizing way in which her carers spoke to her.

4. Vision Stories - Tell these to inspire hope, especially when your team needs occasional reminders of why they're doing what they should be doing.

Vision Stories are meant to stimulate action and raise morale. Find a story that reminds everyone what the ultimate goal is, and why it's important that everyone reaches that goal. This type of story should be told from your heart, with emotion.
The author shares her own vision story, which is one of human beings saving the planet from ecological disaster by working together. She drew on the importance of embedding this collaborative approach in society when she was at the airport recently, and her plane was delayed for the third time. While it would have been tempting to take out her frustration on the airline staff, remembering the importance of helping others to work collaboratively helped her calm her emotions.

5. "Values in Action" Stories - When you see the word "integrity," what do you think of? Honesty? Doing the right thing for the right reason?

Every value can mean something different from person to person. If you want to pass on values to your team, start by defining what those values mean to you. So, if you want your team to demonstrate a high level of customer service, then tell a story that reveals exactly what customer service means to you.

For example, a chain of opticians ran an advertising campaign that offered to replace glasses with a new style if customers didn't like the frames when they got them home. Now this led to the transaction costing the optician money in most cases. However, the manager at one store regularly told his staff about a customer who had taken advantage - most apologetically - of the offer, but then not only remained loyal to that optical chain for years, but also recommended the chain to her family and friends. As a result, the small loss on one transaction bought the chain many profitable purchases in the future.

6. "I Know What You're Thinking" Stories - The world of business involves frequent bargaining. The advantage of telling this type of story is that you can recognize another person's objections, and then show why those objections aren't applicable in this situation. You can show respect for the other point of view while convincing the person that you're right.
For example, a saleswoman in children's shoe store convinces a mom to buy a pair of premium-priced shoes by explaining that if her child doesn't find his new shoes comfortable after a week, she can bring them back for an exchange or refund. This is the case even though the shoes would be worn and couldn't be resold. The saleswoman backs this up by telling of one customer who did that just last week, although she was the only customer whose child hadn't loved the shoes.

Tips

Keep these suggestions in mind when telling your stories:

• Be authentic - The best storytellers talk from their hearts, so don't try to fake an emotion that you don't feel. Your listeners will probably see through this, and your story will crash and burn.

• Pay attention to your audience - Stories that are too long are generally boring. Tell the story well, but don't go on forever.

• Practice - Try to practice before you tell the story. Even if you tell it to yourself just once in front of a mirror or video camera, this can help you when you're in front of your real audience.

• Create an experience - Remember that when you tell a story, you're creating an experience for your listeners. Don't just use sound (words), but the other senses as well. Show your listeners the picture you're painting, don't just tell them.

For example, it's easy to tell people that it's snowing outside. But if you want your listeners to really experience the snow, then describe how cold it is and the way the wind blows snow into your eyes. Tell them how you dream of a hot cup of cocoa after you're done shoveling snow in your driveway, and how your toes freeze because your boots aren't warm enough. Try to engage the five senses in every story: taste, touch, sight, hearing, and smell. They'll make your story come alive.

Key Points

Stories can be powerful leadership tools - if they're told well.

Know which kind of story to tell, and spend time brainstorming some good ideas for each type of situation. Remember, you're creating an experience for your listeners, so focus on using at least two or three senses when you tell your story. Create interest, and draw your listeners in. Show them what you're saying, don't just tell them.

Beautiful night in Kyoto

It's sometimes nice to just take a break and enjoy beautiful scenary.  The fall color in Kyoto around this time is absolutely fantastic, and I was lucky enough to be here to take some photos at night.

Take a few minutes and enjoy these quiet and reflective Kyoto photos....

More Greenbelt Graduation Photos

If you are curious as to who graduated from this class, here is the link to all of the photos from our graduation ceremony.

Greenbelt Fall 2010 Graduation Photos

Class of Fall 2010 Greenbelt

Greenbelt Fall 2010 class has just completed their final module and - yes - everyone has graduated!  It is always so exciting and refreshing to see our Greenbelts go through the challenges and successfully complete "the mission."

It is our honor to graduate some of our best students to date!  Congratulations!

Three students who received the highest score in the Greenbelt Exam

Left to right: (David Chao LSI founder), Sarah Russell Vancity, Harvir Sangha Fraser Health, Nik Bergeron Moulding & Millwork

LSI to conduct Lean Problem Solving in Singapore and Malaysia

Our most popular Executive Program is LPS - which stands for Lean Problem Solving. Using a sophisticated 9-step process for solving anything from a simple 5S problem to a complex, multi-faceted supply chain project, LPS is virtually guaranteed to produce effective results. Instead of "jumping" into conclusions quickly, the LPS methodology encourages people to examine root causes deeply, assess its impact across the value stream, and create sustainable results not often possible with simpler PDCA (Plan Do Check Act) methods.

As the most important Executive Certification topic, LPS workshop and kaizen are taught throughout the world.

Next week, LSI is headed to Singapore and Malaysia to conduct two Lean Problem Solving session back to back.  So far, we have trained more than 300 people on how to use LPS to solve problems.

Want to know what LPS is all about? Take a look at our youtube video about LPS session which was held in China just this September.

Quote of the day

I read this quote today and thought that it's worth sharing.....

"Recipe for happiness: Live with enthusiasm, smile for no reason, love without conditions, act with purpose, listen with your heart, and laugh often......"

Blackbelt Certification

Our current Blackbelt program is ending soon in December, but in January, we kick-off another one again.  Designed to develop world-class lean leaders, the Blackbelt offers four modules of intense, insightful projects. More importantly, the Blackbelt programs include a complete benchmarking trip to Japan (all travel expenses except flights are included).  For more information on registering for the January Blackbelt Program, please contact our office or visit our website.

Please take a look at our overview video:

LSI at AME Lean Conference in Baltimore!

LSI is proud to be one of the speakers again, at this year AME Lean Conference - the world's most respected conference in the field of lean thinking.

I will be talking about Lean Strategy on the first day. We are excited to be part of the conference and look forward to networking with many of our lean associates and friends.

If you are at AME this year, please look us up and connect with other lean enthusiasts!  We hope to bring you some insights right here on our blog, from Baltimore Maryland.

Asian and American Leadership Styles: How Are They Unique?

Source: Harvard Business
Executive Summary:


Business leadership is at the core of Asian economic development, says HBS professor D. Quinn Mills. As he explained recently in Kuala Lumpur, the American and Asian leadership styles, while very different, also share important similarities.

Editor's Note: Political connections and family control are more common in Asian businesses than in the United States. In addition, says HBS professor D. Quinn Mills, American CEOs tend to use one of five leadership styles: directive, participative, empowering, charismatic, or celebrity. Which styles have Asian business leaders adopted already, and which styles are likely to be most successful in the future?


In a talk in Kuala Lumpur on June 15 at the invitation of The Star/BizWeek publication and the Harvard Club of Malaysia, Mills explained the differences and similarities between American and Asian leadership. Below is the transcript of his talk, "Leadership Styles in the United States: How Different are They from Asia?"

=====================

The rapid economic development of Asia in recent decades is one of the most important events in history. This development continues today and there is every reason to anticipate that it will continue indefinitely unless derailed by possible but unlikely international conflicts. At the core of Asian economic development is its business leadership—managers and entrepreneurs who sustain and create Asian companies. Do they exhibit the same leadership styles as top executives in the West?
There are important differences. Are differences attributable to different cultures or to different stages of corporate development?
But first, what are we talking about?

Roles in organizations involve more than just leadership. It is useful, but not yet common in our literature and discussion of business, to distinguish among leadership, management, and administration. They are in fact very different; each is valuable and has its place. Briefly, leadership is about a vision of the future and the ability to energize others to pursue it. Management is about getting results and doing so efficiently so that a financial profit or surplus is created. Administration is about rules and procedures and whether or not they are being followed. These distinctions are very important to clear communications among us about how organizations are run—when they are not made, we become very confused, as is much of the discussion around our topic.

Briefly, running an organization effectively involves:

Leadership:

Vision

Energizing

Management:

Efficiency

Results

Administration:

Rules

Procedures

Our focus today is on leadership: how an executive sets direction and energizes his organization to pursue the direction. This is appropriate because managerial techniques are being spread fast by imitation, adoption, and MBA education. Administrative techniques were generalized around the world decades ago. So what is much different now is leadership.

Family and political connections

Cultural differences are important, but primarily as a matter of emphasis. For example, family leadership of business enterprises, including large companies, occurs in very similar ways in both [regions], but is more common in Asia.

Li Ka-shing [of the Hong Kong-based Hutchison Whampoa and Cheung Kong holding group], for example, runs his companies closely and is planning to pass the leadership of his firms to his two sons. Similarly, the heads of some of America's largest firms, both publicly held and private, are the scions of the families that founded the firms.

There is less freedom of action for executives and boards in America than in Asia.

But more common in America are firms that are run by professional managers who are replaced by other professional managers, either as a consequence of retirement or of replacement by the board of directors of the firm. The better companies have sophisticated programs for developing executives within the firm, and ordinarily choose a next chief executive officer from among them. American CEOs average about thirty years with their firms and own less than 4 percent of its shares. There is a small number of firms, which get a great deal of publicity and so seem more numerous than they are, that hire CEOs directly from the outside, with no previous experience with the firm. These CEOs are driven by a need to excel in a competitive environment (they want to win), and they insist that money is less important to them than professional achievement; but it's hard to credit that given the enormous inflation of top executive compensation packages in America in the last decade.

Many American firms, especially most of the large ones, are more dependent on capital markets for their capital (equity and debt) and so pay much more attention to Wall Street than is yet common in Asia. Wall Street has strong expectations about the behavior and performance of executives and about succession. There is less freedom of action for executives and boards in America than in Asia.

In Asia, succession usually is passed on to the siblings. In Li's case, he is handing it to his two sons, while Jack Welch developed a talent machine to groom CEOs for General Electric.

To a significant degree, large American firms are at a later stage of development than many Asian firms—they have passed from founders' family leadership to professional management and to capital obtained from the capital markets (rather than obtained from government—directly or indirectly—or from family fortunes). In this transition they have adopted particular styles of leadership responsive to boards (often led by outside directors) and to Wall Street.

It is possible, but not certain, that Asian firms will follow this evolutionary path. The political connections so important for top business leaders in Asia, whether in democracies or one-party states, are not unknown but are much less important in America. It is a characteristic of Asian top executives that they have such connections that are important to their businesses. In America, the chief executive officers of very large firms often have virtually no direct connections to top politicians—the government is treated at arm's length and business is done by business people. There are, of course, exceptions, and deep political involvement is still a route to business success in America, but it is much less common than in Asia.

Leadership styles in America

Leadership styles are more varied in America today than in Asia. In America there are five:

Directive

Participative

Empowering

Charismatic

Celebrity (superstar)

The first four reflect how an executive deals with subordinates in the company; the final one is directed at people outside the firm.

Directive leadership is well known in America, but is declining in frequency. It stresses the direction given by executives to others in the firms. The leader is very much in charge. This style is very common in Asia.

Participative leadership, which involves close teamwork with others, is more common in Europe, where it is sometimes required by law (as in northern Europe, especially Germany) than in America. It is also common in a variant colored by national cultural norms, [as] in Japan.

Empowering leadership is relatively new, and stresses delegation of responsibility to subordinates. American companies that operate with largely autonomous divisions employ this style of leadership. A few younger Asian business leaders now espouse this style (for example, the CEO of Banyan Tree Resorts).

At the core of empowering leadership is the ability to energize the people in a company. Jack Welch commented, "You may be a great manager, but unless you can energize other people, you are of no value to General Electric as a leader." Energizing others is the core of the new leadership in America.

Adaptability is ... less common and less valued in Asia and Europe. It will be needed everywhere soon enough.

Charismatic leadership is the leader who looks like a leader. People follow such a leader because of who he is, not because of good management or even business success; nor because [the people] are offered participation, partnership, or empowerment. Human magnetism is the thing, and it is very different in different national cultures. What looks like a charismatic leader to Americans may appear to be something very different to people from other societies.

Celebrity leadership is very different. It looks outside the company to the impact on others—customers and investors. The CEO becomes a star and is sought after by the media like a screen star. Ordinarily it requires good looks, a dramatic style, and an ability to deal effectively with the media. It is in a bit of a slump in the United States right now due to the corporate financial reporting scandals, which have focused attention on CEOs with the ability to get things done right in the company; but celebrity leadership will make a recovery. Boards looking for top executives to revitalize a firm look for superstars; they seek outgoing personalities.

Corporate governance in the West means oversight from regulators, boards of directors, even institutional shareholders. While Asia now has most of these institutions, they are ordinarily not as well established and not as significant in the minds of top executives. Asia is bedeviled by official corruption that reaches far into business. America has less of this, but has in its place considerable financial reporting fraud. Both are very dangerous to the economic success of the nations involved. Graft tends to destroy an economy first by undermining the trust that is required for transactions to occur, and by distorting the economic calculus that underlies sensible business decisions. As it continues, graft destroys the national political entity. Long-established graft is a way of life that is very hard to root out. Politicians promise to eliminate it, but are unable or unwilling to do so.

The role models available for business leadership in the different regions of the world are significant. In America, with its longstanding experience with professional business leadership, the most readily available role model for the head of a company is the corporate CEO. In China and Chinese-related businesses it is the head of the family. In France it remains the military general. In Japan it is the consensus builder. In Germany today it is the coalition builder.

There are nine key qualities that research shows people seek in a successful leader:

Passion

Decisiveness

Conviction

Integrity

Adaptability

Emotional Toughness

Emotional Resonance

Self-Knowledge

Humility

The emotionalism that goes with passion is more common in America than elsewhere. Europeans see it as a sort of business evangelicalism and are very suspicious of it. Decisiveness is common to effective executives in all countries: In this regard European and Japanese chief executives are the most consensus-oriented, and Chinese and American top executives are more likely to make decisions personally and with their own accountability.

Conviction is common to all.

Integrity is a complex characteristic very much determined by national cultures. What is honest in one society is not in another, and vice versa.

Adaptability is a pronounced characteristic of American leadership generally. It is less common and less valued in Asia and Europe. It will be needed everywhere soon enough.

Emotional toughness is common to all top executives; Americans spend more time trying not to show it.

Deep political involvement is still a route to business success in America, but it is much less common than in Asia.

Emotional resonance, the ability to grasp what motivates others and appeal effectively to it, is most important in the United States and Europe at this point in time. It will become more important in Asia as living standards improve, knowledge workers become more important, professional management gets greater demand, and CEOs have to compete for managerial talent.

Self-knowledge is important in avoiding the sort of over-reach so common in America; it is less common a virtue in America than in Asia, and is a strength of the Asian executive.

Humility is a very uncommon trait in the American CEO. It is sometimes found in Asia. It is often a trait of the most effective leaders, as it was in the best-respected of all American political leaders, Abraham Lincoln. Once, when the Civil War was not going well for the Union side, a high-ranking general suggested that the nation needed to get rid of Lincoln and have a dictatorship instead. The comment came to Lincoln's ears. Lincoln promoted the general to the top command in the army anyway and told him, "I am appointing you to command despite, not because, of what you said. Bring us victories, and I'll risk the dictatorship."

What's next for Asia

The "New Asian Leader"? There are three prototypes:

1) Li Ka-shing of Hutchison Whampoa-Cheung Kong: old Chinese leadership in transition like Li Ka-shing. Rags-to-riches in one generation; handing over his business empire to his two sons who are Western-trained. There are many such examples in Asia. Li Ka-shing is in different areas of business—telecommunications, security, and high-end IT—and is very interested in becoming a contractor in the emerging homeland security construct in America. With Li Ka-shing, the threat to success is his reliance on an international concern to be a significant contractor in the establishment of the U.S. homeland security hierarchy. Li's personal story is an amazing tale of success. After the death of his father, Li—at age twelve—went to work in a plastics factory. Within a decade he started his own plastics company, which he later leveraged into a real estate and investment concern. It then was an early entrant into China's telecom and IT wave of the early 1990s, and became a market leader.

Li is a man who seeks to establish a positive legacy. He created a foundation in 1980 to help young Chinese students have the educational and other opportunities he had to make for himself at age twelve. He also started his own university, Shantou University, in 1981, with a similar purpose.

2) William and Victor Fung of Li & Fung: old traditional Chinese family-owned companies now run by the third generation of the family, Western- and highly-educated, who use Western technology extensively to face globalization and succeed. Very much Western-centric in approach yet Asian in practice, the Fungs of Li & Fung have mastered techniques of getting maximum efficiency out of the supply chain, taking raw materials and making low-cost, high-demand consumer goods, particularly clothing, much more cheaply than in the United States.

What the Fungs have accomplished is similar to what Japanese automakers accomplished a generation ago. By strictly adhering to principles of quality control—principles that were espoused by American business consultant Edward Deming—Nissan and Toyota made cheaper, better cars than the Americans did, eventually causing the big three U.S. automakers to follow suit. William and Victor Fung are interested in being business consultants, teaching others how to do what they've done. Both men are Harvard-educated and have a desire to be open and forthcoming about their business model.

As Asian companies seek access to world capital markets, they will move toward professional managers who will employ leadership styles more akin to those now used in the United States.

The main threats with Li & Fung are these: driving down labor costs, and concerns about relying on suppliers who potentially abuse the human rights of workers or pay less than a standard living wage. Victor and William Fung are the new type of Asian leaders—will they soon be the only type?

3) New Economy business leaders. Information technology and the Internet are bringing out a high-tech type of leadership that is common in America's high-tech sector. Entrepreneurial, innovative, hard-driving, very flexible, ambitious, optimistic, visionary in the technology and business aspects, they will play a good, but not dominant role. N. R. Narayana Murthy of India's Infosys and Stan Shih of Acer are good examples. They have adopted an almost entirely Western style of leadership and are succeeding in Asia.

What is the conclusion? Styles of leadership are currently different between Asia and America. Culture colors the way things are done, but less so what is done. The differences in styles most markedly reflect the stage of development of the economies and companies of Asia. As Asian companies seek access to world capital markets, they will move toward professional managers who will employ leadership styles more akin to those now used in the United States.

As Asian companies rely more on professional employees of all sorts, and as professional services become more important in Asian economies, the less autocratic and more participative and even empowered style of leadership will emerge. Asian leadership will come to more resemble that of the West. But significant cultural differences will remain—economic and geopolitical rivalries within Asia and between Asian countries and the West will continue and perhaps grow. Economies will retain characteristic national features. Convergence in a leadership style does not guarantee likeness of results nor even peace. We will continue to have to work for economic progress and peace; it will not come automatically.

Lamborghini Factory Tour

While we are on the subject of the European Lean Tour, here's some interesting information about the Lamborghini Factory Tour, available in the internet.

For example, you can find a video clip from the Speed channel about the Lamboghini factory on youtube, which is quite interesting.