What’s your philosophy of leadership? Hands off? Micro-management? Numbers-based (just deliver the results)? People-based (keep employees happy)? Some combination of the above?

When asked that question in a recent New York Times “Corner Office” column, the CEO and chairman of Saks, Stephen Sadove, had this to say:

“I have a very simple model to run a company. It starts with leadership at the top, which drives a culture. Culture drives innovation and whatever else you’re trying to drive within a company — innovation, execution, whatever it’s going to be. And that then drives results.

“When I talk to Wall Street, people really want to know your results, what are your strategies, what are the issues, what it is that you’re doing to drive your business. They’re focused on the bottom line. Never do you get people asking about the culture, about leadership, about the people in the organization. Yet, it’s the reverse, because it’s the people, the leadership, the culture and the ideas that are ultimately driving the numbers and the results. So it’s a flip.

“What I try to teach people is, don’t ask the first question in terms of numbers. Let’s talk about the people, let’s talk about the culture, let’s talk about the ideas and the innovation.”

I greatly appreciate Mr. Sadove’s philosophy, summarized as:

Leadership –> Culture –> Strategic Objectives –> People –> Results

When you focus first on your leadership, what kind of culture they are passively allowing or actively encouraging to develop, the strategic objectives you’ve identified for your organization, the people executing on those objectives within that culture, THEN you will get the results you need – and perhaps more. But if you focus first and most intently on the results, as Wall Street tends to, you may achieve a short-term objective but lose any sustainability to continue those trends in the long-term.

I wrote a couple of years ago about a finding from the Forum for People Performance Management and Measurement 85% of a company’s assets are in “intangibles.” If, as is standard, Wall Street firms are valuing companies based only on tangibles, then much of the picture is being ignored.

What’s your philosophy?

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