On January 5, 1914 Henry Ford and the Ford Motor Company announced to the US that they would pay their factory workers $5.00/day for their labor. This was a little over a 100% increase from the average wage across the United States and it sent a shock wave throughout the country. Leaders in other organizations were both outraged and terrified by the unprecedented move as they knew theirs would soon have to follow suit and contemplated the perceived lower profit margins.

Henry Ford, however, became an overnight hero and helped transform the middle class economy of the United States. Workers flocked not by the thousands but tens of thousands to come work for the Ford Motor Company. Workers in his factory not only felt the pride and prestige of their newly prized positions but they often made public commitments to give a 100% increase in their efforts to Mr. Ford for his generosity.

Source:
“I INVENTED THE MODERN AGE, The rise of Henry Ford”, by Richard Snow

But that was literally, 100 years ago, at the birth of the linear assembly line age. The world of 2014 is a stark contrast to the world of 1914 and even  terms like, “carrot and stick management technique”, have become antiquated buzz phrases. Yet leaders in many organizations today still believe that it’s just a matter of “pay them more and they will work harder” or worse “we’re paying them more so if they do not produce more results they get the stick”.

So what if your organization does not involve pay? Like amateur athletics? Or it’s more complicated than simply paying people more, like being the president of the United States? Some have reduced leadership to the “destination and map model” or more commonly known by the buzz word….Vision. The net result over the last ten years has been sterile corporate objectives, mission statements and founding values that has done little more than pay lip service to the true meaning of the term vision.

So if that is all obsolete, what’s a more “21st Century” notion of leadership excellence?

“Leadership is recognizing and communicating another person’s worth so effectively that they come to realize it in themselves.”

– Dr. Stephen Covey

And how do you communicate another person’s worth?

Public acknowledgement of their accomplishments

Everyone likes a ‘moment on stage’, to know that they matter. But it must be sincere, it must not be overdone and it must not be a backhanded compliment with ‘areas of improvement’ wedged in between. People are a little sharper today than a century ago. Overdone compliments and the old “positive sandwich technique” are an obvious and quick way to lose credibility as a leader.

Invest your personal time, in their professional development

The world does not need more on-line training modules, webinars, manuals, formal mentor programs or team bonding events. It needs people, taking a genuine interest in people, at all levels and passing on knowledge and coaching from their own experience. Naturally this will have limits, a leader cannot be all things to all people all the time, nor can they afford to get caught up in individual dramas that can ensue. But that should not stop them from trying, as most people simply want to get better as a professionals and as a human beings. This is genuine mentorship, this builds trust and respect.

Create new opportunities, new challenges

Regardless of the size or scope of the organization, few people want to remain stagnant and those that do are often grateful for being nudged out of their comfort zone. So it is safe to say that people need new experiences and to steal a line from Dino De Laurentiis; “It jars something deep inside, allowing us to grow. Without change, something sleeps inside us and seldom awakens.” Leadership is the responsibility to make sure that everyone in the organization has new challenges, pushed past boundaries and have professional opportunities that matter to them as well as the organization.

And yes, people want to get paid but

That by itself is no longer enough, nor is it leadership. Organizations that cut corners with people’s compensation can quickly lose trust and credibility, earn a reputation for caring more about the dollars than the people. On the other hand, organizations can over compensate and can end up getting taken advantage of by those tempted by greed or willing to cut corners themselves. Leadership is the responsibility to balance the pay component, if applicable, with the culture created by the other three components above.

Ultimately, leadership in the 21st Century is a complex topic and a lot has been written about it, just in the last decade. It’s safe to say though, it’s much more than the “Five Dollar Day”.

“If you take great care of your people, they will take great care of your customers and long-term profits will follow.”

– Jack Taylor, Founder of Enterprise Rent A Car

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