Good to Great – the Dynamics of Power in Level 5 Leadership

Jim Collins, a former Stanford Business School professor, is the author of many books about leadership. Perhaps his most notable title is a book called “Good to Great”, published in 2001. As a leader in the Silicon Valley, I cannot begin to tell you how many times this book has been the basis of a training I’ve attended, referenced in articles published by companies that I have worked for, and how many copies of this book that I have been gifted. What I am trying to say is that the book is popular! The Economist says it best, “Good to Great”, published in 2001, have become the Harry Potters of management literature, hugely popular and holding the promise of magic.” (Economist, 2008, pg.1) Today I would like to look at the idea of Level 5 Leadership, one of the tenants of Collins’ book through the lens of what we have learned in our lesson about how power and influence mold organizations, relationships, and ultimately the leaders themselves. 

First, let’s look at how Mr. Collins defines a Level 5 Leader. “Level 5 leaders display a powerful mixture of personal humility and indomitable will. They’re incredibly ambitious, but their ambition is first and foremost for the cause, for the organization and its purpose, not themselves.” (www.jimcollins.com, 2020) Mr. Collins divides team members in an organization into five levels:

(Denis, 2018)

In his book, Collins shares that there are very few differences between Levels 4 and 5. The main one being that a Level 5 leader cares about the fate of the organization, long after they are no longer a part of it. They make decisions based on what is best for the organization and are able to separate their own ego and desires from what will be best for the company. “Level 5 leaders channel their ego needs away from themselves and into the larger goal of building a great company. It’s not that Level 5 leaders have no ego or self-interest. Indeed, they are incredibly ambitious – but their ambition is first and foremost for the institution, not themselves.” (Collins, 2001, p.21) 

In our lesson this week, we started with a definition of power. “Power has been defined as the capability to produce affects on others or the potential to influence others.” (Hughes, 1993, p.107) We learned that many people in the organization have the ability to wield power, not just those in a leadership role. Some good examples of people who can wield power in an organization, without the title of “leader” would be teams that have unionized, a well-respected team member that has built strong relationships, and the team member who has the most subject-matter expertise in the organization. Our reading defines influence as “the change in a target agent’s attitudes, values, beliefs, or behaviors as a result of influence tactics.” (Hughes, 1993, p.108) Influence can be used by anyone in the organization to affect outcomes. Often, when we think of power and influence, we equate it to people who have formal titles and  have the authority to wield power on due to that title. I personally think of people like politicians and CEOs. However, as we learned this week “legitimate power” is just one type of power in the world. 

As identified by French and Raven in 1959, there are five sources of power that someone can use to influence other. I have mentioned one already – legitimate power. Legitimate power is power that is bestowed upon someone through a title. “It can be thought of as one’s formal or official authority.” (Hughes, 1993, p.115) Someone with legitimate power can assign projects, give raises, and dismiss people from the organization. Alone, legitimate power doesn’t make you a leader, rather it just bestows the ability to make decisions for the organization. The next source of power is “expert power”. The source of this power lies in an individuals intimacy with the subject at hand. Remember the person in the organization with the most subject-matter expertise? They have expert power. An example of expert power would be scientists who are developing new medicines to treat ailments. They are the experts in their field of study and have the power to shape future outcomes because of it.  Reward power is the third source of power and it refers to the ability to influence others through “controlling desired resources”. (Hughes, 1993, p.116)  Some examples of these desired resources could include a prime parking space, a bonus, or a promotion in the organization. You have reward power if you are in a position to grant these resources to others. The opposite of reward power is “coercive power”. Coercive power “is the potential to influence others through the administration of negative sanctions or the removal of positive events.” (Hughes, 1993, p.119) Some examples of this type of power include teachers giving students detention for bad behavior and the threat of jail time for breaking the law. 

I’ve saved “referent power” for last, as I feel that this is the type of power that related most directly to the ideas presented as part of Level 5 Leadership. Referent power refers to the power of relationships. It is the influence that a leader can have based on the strength of their relationships with their followers. If you wanted to assign competencies to this type of power, you might discuss Interpersonal Savvy, Building Relationships, and Listening. This type of power can be thought of as a necessary building block to gain more power as well. Followers can gain referent power by building relationships with other followers – remember the union? Someone who has referent power can be thought of as a leader, without having any of the other four types of power, because it is all in the relationships that they have built. You can then use referent power to gain the other four types of power and influence the organization. As our lesson quoted,  “Power in an organization is the capacity generated by relationships.” – Margaret A. Wheatley. 

(Hughes, 1993, p.114)

The acquisition of power is an interesting topic. When you discuss “getting power”, the imagery that can come to mind is someone who is ruthless, cut throat, and relentless in that pursuit. So, how does that align with the idea of a Level 5 Leader? In a 2017 speech, Jim Collins said “The X factor of truly great leadership is humility; humility combined with a ferocious will for something bigger than yourself, humility in a very special way… Level 5s lead in a spirit of service, and they subsume themselves and sacrifice for that. “ (www.jimcollins.com, 2017) Collins makes the distinction that a Level 5 Leaders “need for power” is derived from wanting the organization to be better, and their psychological satisfaction in this pursuit comes from improving the organization for everyone that is a part of it. In other works, they want “socialized power”. “Socialized power is exercised in the service of higher goals to others or organizations and often involves self-sacrifice toward those ends.” (Hughes, 1993, p.121) This concept is not new, in fact it’s been discussed for over 40 years. Jim Collins has been able to put a spin on it and increase its relevancy in todays business world, but it has long been understood that there is a choice to use your power for good or evil.

As a final thought on how the ideas of power and influence relate to the Level 5 leaders of today, I’ll call attention to a video that we watched as part of our lesson this week. In his discussion on “Power and Influence in the Collaborative Age”, Jeffrey Pfeffer says the following: “You do not need to use the same principles of the same ideas in managing up as you would managing laterally or as you would managing down. Leadership literature is about how to build a high-performing team or manage subordinates. Well, that presumes that you’ve managed to get yourself into a position where you have a team or subordinates.” (Pfeffer, 2011)  Mr. Pfeffer points our that there are different tactics that need to be employed in order to gain power, so that you have the opportunity to be a transformational Level 5 leader. Gaining power and then wielding power are two different things and require different kinds of work. Once you have gained power, you must then decide how you are going to wield it and whether socialized or personalized power is more important to you. This is also the line where the distinction between Level 4 and Level 5 leadership is made. I would also draw the correlation that the culture of a company can determine whether someone ultimately becomes of Level 4 or a Level 5 leader. I believe that someone who innately is a Level 5 leader and believes in the ideas behind socialized power, has the ability to change the culture in an organization for the better, thereby living up to the main tenant in “Good to Great” – leaving something better than you found it, for long after you are gone. 

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