So Microsoft has its man – and good luck to him. The software giant has chosen its former head of cloud and enterprise, Satya Nadella, to succeed Steve Ballmer as CEO.
But it is the story of a different candidate for the top job that I find fascinating: former Nokia head Stephen Elop, the first foreigner to run the pride of Finnish industry in its 150-year history.
Elop’s appointment gave many Finns deep reservations. I remember a Finnish businesswoman I know expressing grave concerns to me on the day he was hired. I also recall thinking that a more pressing concern was surely the perilous situation facing the mobile phone manufacturer at the time.
The one-time global market leader had experienced a spectacular reversal of fortunes. Market share had plummeted to disastrous levels; the firm had no high-end smartphone in production; and there was no strategy to speak of. Commentators had written off Nokia as a serious competitor. Yet just three years later, Microsoft saw fit to pay €5.4 billion ($7.2 billion) for the company’s cellphone division – a development that placed Elop firmly in the running for the number one spot at Microsoft.
The ‘altrocentric’ effect
Nokia was back. So what had Elop done to reinvent the company in such a short space of time?
In my view, he took the firm through a highly effective process of ‘meaning-making’. And in doing so, he embodied many of the attributes that I believe will define successful leaders in the future. He exemplified what I call ‘altrocentric’ leadership.
My Hay Group colleague Yvonne Sell and I describe how a changing business landscape will demand this new approach to leadership in our book, Leadership 2030. To summarize, the global business environment of the future will be characterized by six ‘megatrends’ with profound effects on societies and organizations.
The first – globalization 2.0 – is a shift in economic power from West to East. This is creating a new global middle class, fragmenting markets and intensifying competition. The second is the environmental crisis – a combination of climate change and a growing shortage of natural resources that will push sustainability to the top of the corporate agenda.
Individualism and value pluralism are the consequence of the freedom of choice that comes with growing affluence around the world, eroding customer and employee loyalty and turning workplace motivation on its head. Meanwhile, digitization is blurring the boundaries between private and professional life, as work and the workplace increasingly go remote.
Demographic change is aging the world’s population, reshaping the global workforce and intensifying the war for talent. And technological convergence is merging NBIC (nano, bio, information and cognitive) applications to create potent innovations to transform many aspects of everyday life.
Coping with the six megatrends will demand a new breed of leaders: altrocentric leaders. Individuals whose focus is on others, not themselves, and who see themselves as a part of the greater whole.
Altrocentric leaders are characterized by:
high degrees of empathy, maturity, integrity, and openness
skilled strategic and conceptual thinking
the self-awareness to know they cannot achieve success alone
the ability to create and empower high-performing teams
a reliance on collaboration and teamwork.
And crucially in Nokia’s case, they understand the importance of creating meaning-making for those around them.
Bringing meaning back to Nokia:
To revive Nokia’s fortunes, Elop took the company on a five-part journey of meaning-making.
From the outset, Elop communicated with as many employees as possible. He asked them directly: what needs to change? What doesn’t? What should he address most urgently?
What he heard was deeply worrying. Nokia was dogged by complacency, sluggishness, confusion, and disengagement. There was little in the way of strategy, direction, leadership, accountability, or ownership. Worse, the company was burying its head in the sand. But this signaled to Elop that something else was missing too: a single, unified narrative; a shared Nokia story. To get the company back on track, he needed to create one, and fast. He needed to make Nokia mean something to its people again.
Elop knew that he would need to kick the meaning-making process off with an urgent wake-up call.Cue his famous “burning platform” speech. He compared the company with a burning oil rig, where a man has two choices: Be engulfed by flames, or plunge into the sea.He told his entire workforce: “Nokia, our platform is burning.”Though shocking, this was a smart move. It pointedly challenged Nokia’s sense of identity, and destroyed the complacency that was serving the firm so badly.
While writing Leadership 2030, I spoke to Juha Äkräs of the Nokia Leadership Team. He told me: “There was a sense of relief that the new CEO had identified the problems we faced, and was prepared to air them and take them on.”
Elop then set about creating a top team capable of making reinvention happen–and crucially, empowering them to do so.
He renamed the board the Nokia Leadership Team (NLT), as if to remind them that they were there to lead. He co-developed the new strategy for Nokia jointly with the NLT – in just eleven weeks. And he gave each NLT executive more autonomy.
Äkräs described the sense of unity among the NLT that Elop quickly engendered: “The team met weekly and was fully aligned with the strategy,” he told me.
The NLT was charged with the next phase of Nokia’s reinvention: the alignment and engagement of the rest of the company.
This was an exercise in creating meaning. The aim was to embed much-needed behaviors that were sorely lacking from Nokia’s culture. Äkräs told me: “We needed to address the lack of accountability and urgency that had allowed us to fall so badly behind.”
The final step was to cascade a new vision of Nokia’s purpose and values through the organization. This meant enabling every member of the workforce to be able to express why they worked for Nokia, and why they believed in the company.
To help with this process, the NLT brought together a group of “new Nokia builders”, comprising the 200 senior executives under the NLT and selected front-line managers. The group’s role was to create transparency, foster involvement and establish a permanent dialogue with the workforce in order to boost engagement.
For me, what’s interesting about Elop’s actions–other than their undoubted success–is how they embody many of the attributes of altrocentric leadership.
It’s clear to me that Elop understood the importance of shared meaning in an organization; and had the strategic wisdom to realize that the complacency embedded at Nokia was out of touch with reality.
He then had the courage to destroy that meaning and shake the firm out of its complacency. He did this despite knowing he would attract attention (a memo containing his speech was widely leaked and commented on) as well as criticized.
He was also self-aware enough to know that reinventing Nokia was too great a task for any one individual. So he not only created a team he knew could deliver, but went out of his way to empower them. What’s more, he had the emotional maturity and openness to listen to his team and his workforce throughout the process.
Elop’s ability to listen suggests to me a further quality of altrocentric leaders: stakeholder recognition. In a world vastly complicated by the megatrends, organizations will have an ever-expanding set of stakeholders to manage. Altrocentric leaders know this, and take time to consider the interests of each.
One to watch
All in all, I see Elop’s time as CEO of Nokia as a textbook example of altrocentric leadership. I doubt we’ve seen the last of him.
Follow Georg’s live Twitter: @GVielmetter.
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Georg Vielmetter heads the European Leadership & Talent practice at global management consultancy Hay Group. He is author (with Yvonne Sell) of Leadership 2030: The Six Megatrends You Need to Understand to Lead Your Company into the Future.