1: When soccer sensation Lionel Messi sprints down the field and scores, he gets an assist from his high-tech Adidas soccer boots.
“Sure, Messi has a sponsorship agreement with Adidas—the world’s second-largest athletic apparel maker after Nike,” Carolyn Dewar, Scott Keller, and Vikram Malhotra write in CEO Excellence: The Six Mindsets That Distinguish the Best Leaders from the Rest.
Lionel’s shoes, however, do more than help him score goals.
“They manifest the vision that former Adidas CEO Herbert Hainer set for the German company in 2001,” Carolyn, Scott, and Vik write.
When Herbert became CEO, Adidas “was losing market share and stumbling on new footwear designs.” the authors write.
“A less bold CEO would have put the financial clamps on the organization and tried to turn around the profit and loss (P&L) by pushing employees to sell more shoes, clothing, and accessories more efficiently.”
Herbert certainly understood that strong financial performance was critical. But this was not his initial area of focus.
“Instead, he reframed the company’s vision to be all about helping athletes fulfill their potential,” Carolyn, Scott, and Vik observe.
“The goal wasn’t to be the biggest and the richest,” Herbert recalls. “It was to start creating products that help athletes perform better, so the runner can run faster, the tennis player and the soccer player can play better.
“All we had to do was help people achieve their personal best, and by doing so we’d also be making the world a better place.”
Herbert continues: “If we did that and provided good service to our customers, the financials would follow.
“I wanted to give the company the belief that this is more than just a revenue game and we are more than just a revenue company.”
2: Herbert’s vision for Adidas was backed by action.
“When investors would punish Adidas for having a lower profit margin than Nike,” Carolyn, Scott, and Vik note, “he’d respond calmly that Adidas’s product development costs were higher because they were going to make the best performance product.”
“We will never disappoint an athlete with our product that they are wearing,” he says. “If we help them make their dream come true—winning an Olympic gold medal, the French Open, etc., then we have achieved more than just revenue numbers.”
This focus on the highest athletic performance also led to incredible financial performance.
When Herbert retired after fifteen years at the helm, the Adidas brand was rebuilt, and the company’s market capitalization increased from $3.4 billion to more than $30 billion.
3: The world’s best CEOs don’t focus their energy on achieving financial outcomes. Instead, “profits were an outcome of achieving their vision,” the authors note.
Oliver Bäte, CEO of the world’s largest insurance company, Allianz, explains why: “Nobody gets galvanized by, ‘I need to double net profit.’ Sorry, even my top team doesn’t.
“So the question is, what can you rally people behind?”
Aliko Dangote founded Nigeria’s Dangote Group in 1981. Initially, it was a small commodities trading firm.
“Yet, over the decades, his vision was always consistent—to scale up, industrialize, and be Africa’s flagship company in key sectors,” the authors write.
“Today, the group is West Africa’s largest conglomerate, with more than $4 billion in revenue and thirty thousand employees.”
Aliko explains how the power of vision inspires his team and drives innovation: “Africa has six of the world’s ten fastest growing economies, 60 percent of the world’s uncultivated arable land, and by 2050, one person in five in the world will be African.
“Our workforce understands that we have a clear vision to develop the continent, meet core needs, and improve the livelihood of the populace.”
Former Medtronic CEO Bill George describes how vision drove the medical device company into the future: “Our most important metrics weren’t revenues and profits but how many seconds it would take until someone else was helped by a Medtronic product. When I joined the company, it was one hundred seconds. When I left the company, it was seven.”
The desire to heal and improve health creates a powerful motivation far beyond making money.
“Employees want to jump out of bed in the morning to invent something new, produce a high-quality product, or help doctors in an operating room,” Bill says.
“This holds true whether we’re talking about South Korea, China, Poland, or Argentina. It motivates senior leaders, the woman on the production line, an engineer back at the lab, and the person who will drive through the night halfway across the state of Michigan to deliver a defibrillator so a doctor can start a procedure at seven o’clock the next morning. That’s a true story.”
More tomorrow!
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Reflection: How bold am I in setting the vision for my organization, my team, or my life?
Action: Journal about what a bigger, bolder vision would look like.
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