Are You a Step-Up or Step-Down Transformer?

This article was originally published in the Maryland Association of CPA’s quarterly magazine, The Statement

Anxiety and creativity are always inversely proportional to each other. The more anxious you are, the less creative you can be. Therefore, trying to increase your creativity only makes you more anxious. Thinking, “I need to be creative, now!” is unlikely to work.

If you want to increase your creativity, you must focus on lowering your level of anxiety. Note that anxiety is different from stress. You can be in a stressful situation but be non- (or at least less) anxious about the situation. Stress is the circumstances you are in, whereas anxiety is the emotion you feel.

Most people I speak with about this concept are very accepting of the idea, at least for themselves. However, I have found that while people resonate internally with the idea, their leadership style does not reflect it in how they approach others. In leading people, they tend to increase the anxiety of a situation by their behavior. They are “step-up anxiety transformers.”

Transformers are amazing

An electrical device that transfers electrical energy between two or more circuits through electromagnetic induction is known as a transformer and are used to increase or decrease the voltage of electric power of the power grid.

These amazing devices work by wrapping wires around a piece of metal at different densities. If the density of the wrapped wires is lower on the incoming side than the outgoing side, then the voltage is stepped up. If the density of the wrapped wires is higher on the incoming side than the outgoing side, then the voltage is stepped down.

A great example of this is the A/C to USB adapter on your iPhone. One hundred and twenty volts (standard US electrical outlet) would instantly fry your phone. The adapter reduces the voltage to the needed 5 volts for the phone. The little gizmo is a step-down transformer.

In their ground-breaking book, Healing Leadership, Howard Hansen and Steve Geske, postulate that like electrical transformers, leaders can be one of two different types of transformers. They can either step-up the level of anxious energy in an organization or step it down. Sadly, many people are step-up transformers. They write:

The least mature in any group, including families, tie up energy resources.  They are eager to create a negative presence.  We have come to call these people, ‘step-up transformers.’ Neutrally anxious energy goes in. Highly anxious energy comes out.  The net outcome is that leaders’ energy levels are reduced along with the capacity to focus on creative work. They are… skilled at making mountains out of every mole hill.

Far too many leaders fail to recognize this trait in themselves. They think they are helping by “creating a sense of urgency” or “getting people to be accountable.” This is nonsense as it is not only unhelpful, but instead sows the seeds of the leader’s own destruction. They are smothering the ability of their people to develop new and creative alternatives to the problems faced by the organization. Instead, fear takes root as the basic emotion of the group and after fear toxicity quickly follows.

What can be done?

Simply put, nothing, except for the leader to recognize that they are step-up transformers and make a conscious choice to become step-down transformers. Like their metaphorically electrical cousins, step-down transformers attempt to lower the level of anxiety by being a non-anxious presence themselves. They do this by becoming a self-differentiated person – someone who is aware of and acknowledges the anxiety of the group, but does not get enmeshed in the anxiety themselves.

In times of crisis, a self-differentiated leader seeks out a balance between being responsible for what they are in fact responsible for and being labeled as obstreperous, that is difficult to work with. This is not an easy task for many leaders, even leaders who we have traditionally viewed as “good.” Many “good” leaders all too often step in and save the day. In many cases, this behavior is out of benevolence, they truly care and want to help. Curiously, this ultimately leads to a) people thinking they need the leader in more and more situations rather than relying on themselves and b) the leader thinking they must continue to save the day and thus it becomes a vicious circle that sucks the creative energy from the group and replaces it with anxious energy.

Characteristics of step-down transformers

One of the key tools of the step-down transformer leader is humor. (Note not sarcasm.) Humor, especially if a bit self-deprecating and well timed can significantly defuse the anxiety of situations. The reason is that our human limbic (emotional) systems are open to the influence of others, they are not closed. This is why you might laugh at a comedian while in a comedy club, but barely chuckle at the same jokes if they are listening to them on TV while you are alone in a hotel room. Great comedians have the ability to actually link up an audience’s limbic systems.

A step-down transformer leader also knows to make a decision when the same questions keep getting asked over and over again. Alternatively, they sometimes reframe the question in a new way that allows the conversation to take a new less anxious direction. Reframing questions is a learned skill that can be practiced, however, recognizing when to do so is an art form in step-down transformer leaders.

Lastly, step-down transformer leaders know how and when to confront people with their own freedom. This is perhaps the greatest challenge of any leader because it takes not only the ability to recognize the situation, but the courage to act upon it. Often, people who are confronted with their own freedom recoil at the thought. They would rather view themselves as being imposed upon by others. “I have no choice,” is a frequent reply. Great step-down transformer leaders demonstrate by their own actions that human freedom, especially of one’s own feelings, is a choice.

They are not Perfect

Lastly, the most interesting aspect of this type of leadership is that those who practice it are often flawed in the ability to put it into practice. I have studied and struggled with these ideas for a decade. I believe I am better than most people at recognizing the rising level of anxiety of a group, yet still I think I only succeed in putting it into practice about once in three times.

My advice to those of you intrigued by these ideas and want to put them in practice is to learn how to be self-forgiving for not putting them into practice. Ironically, in trying too hard, you will more likely increase your own anxiety. In other words, you will become a step-up transformer of yourself.

Yeah, don’t do that.

Speaking at Sage Summit in Melbourne, Australia

I am thrilled to announce that I will be speaking at Sage Summit in Melbourne, Australia which takes place on Thursday, March 2 and Friday, March 3 at the Crown Melbourne, 8 Whiteman Street, Southbank VIC 3006.

Check back here for specific session times, but I know that I will be speaking on two of my favorite topics – Healing Leadership and Innovating Beyond Technology.

I am so excited, I decided to do a trailer video. Enjoy!

Innovation Beyond Technology

This session is dedicated to the possibility that innovation goes beyond just technological developments. Technology is important, but it is only a small part of innovation. For innovation to be more fully complete we must look at other areas including the internal processes of the organization and most importantly the very language we use. Innovating like this is hard work and not for everyone because it requires deeper thinking than is most often thought. If you believe you can attain this level of thinking, you are invited to attend this session facilitated by Ed Kless, Sage senior director of partner development and strategy.

Healing Leadership

This session is dedicated to the possibility that the majority of leadership thinking is wrong as it is ultimate based on manipulation – trying to “get someone to do something.” Coming to terms with this idea is difficult and not for everyone because it requires us to examine some of our most deeply held beliefs and either dismiss them or at least think differently about them. If you are interesting in having a conversation about healing leadership, you are invited to attend this session facilitated by Ed Kless, Sage senior director of partner development and strategy. This material is based on the work of Howard Hansen and Steve Geske, who have presented at previous Sage Summits.

“Being You” as a job description

As a Met fan I received a brief human interest story in my RSS reader about former Met great Rusty Staub. The gist of the story was about some of the younger players being cut and that Rusty only experienced that once in his career as a 17-year old with the then Houston Colt 45s.

There was, however, this great line, “He [Staub] still works for the Mets, with his job description ‘Being Rusty Staub.’ No one else handles that assignment quite so well.”

I really think we should all subscribe to a similar job description. It sets a bar for us to be self-differentiated and confident in our own skin.

I might just order some business cards with “Being Ed Kless” as my title.

Building the Knowledge Worker Organization

Today, I welcome a guest post from Gary Crouch of CS3 Technology in Tulsa, OK. He wrote this article in the wake of the Firm of the Future session at Insights 2010.

Gary’s thoughts are flashes of brilliance and will take some effort to embrace and even more effort to fully understand and implement. His most profound insight is, “My function then as the leader of a team of knowledge workers is to attract intellectual capital to my team.”

Thanks, Gary for allowing me to post this.

Leader: someone who guides or directs others

Team: a number of people organized to function cooperatively as a group

Sometime back I read a book or article describing how the knowledge worker can and should maximize their own potential by playing the part of the hired gun (unfortunately I cannot locate the article to give credit where credit is due). For the knowledge worker, the author explained, it is in their best interest to manage their career path by hiring out to the highest bidder at every opportunistic step. This could be accomplished by promotions within the current organization or moving through various organizations that have an increasingly higher need for his/her services. Either way, the number one priority is to promote their skills and experience to the marketplace.

As I have personally benefited from implementing many ideas shared by Ed Kless in my business, I attend as many of his speaking sessions as possible. At Insights 2010, I heard Ed describe our employees as knowledge workers, our most important assets, who walk out of our doors each evening. As I had heard this before, my tendency was to get depressed thinking about just how fragile the culmination of my life’s work, our business, really has become. Then, a thought occurred to me and everything came into focus.

Earlier in the day, we reviewed the building blocks for a successful knowledge worker firm as the following formula:

Profits = Capital Management * Effectiveness * Pricing on Purpose

My thoughts focused on the capital management element of the equation. Capital is made up of various resources that the knowledge firm must manage on a continual basis. These resources include the following:

Financial Capital = Operating capital and cash flow

Intellectual Capital = The ability to maintain and grow knowledge within an organization such that it can be applied to solve customer problems

Structural Capital = The environmental components that allow an organization to function effectively such as processes, systems, methodologies, physical plant, communications facilities

Social Capital = The brand of the organization that includes relationships with vendors, customers, external influencers, product and service awareness, and so forth

It dawned on me; in many cases the ability of the knowledge worker to monetize their intellectual capital is limited. Most knowledge workers need to work within an organization for various forms of capital that they either do not possess, or do not have the ability to properly manage. For instance, they may not possess the cash flow for marketing themselves or for investing in new equipment; they may not be able to build systems to manage projects, bill their services, perform Q&A functions while chasing the next job; they may be great technical resources, but not know how to approach social networking effectively so they have a new project waiting for them when their current project is completed. These limitations of the hired gun are answered by participating in a team environment. When the knowledge worker’s specific expertise is combined with varying forms of expertise brought by other knowledge workers and multiple capital resources, only then does the application of intellectual capital bring value to the buyer.

My function then as the leader of a team of knowledge workers is to attract intellectual capital to my team. I can do this by providing the benefits of various forms of capital that the intellectual capital owner does not possess or does not have the ability to manage. If my team is effective to the point of profitability, then I am able to demonstrate the ability to monetize the knowledge worker’s intellectual capital.

Of course, money is not everything. If I also can help the knowledge worker grow in experience, knowledge and capital management abilities, then I have provided value beyond money. As long as the knowledge worker remains with the team, I also have built additional intellectual capital accessible to my team.

To be sure, the process will always be fluid. As the team gains additional experience and knowledge individually, we must recognize the additional value requiring either additional compensation or opportunities to grow. However, the combined growth inherent in the team provides even more reason for the team to remain intact.

Should a member of the organization find a more beneficial team for their situation, then the process begins again and is costly. However, the relationship has been mutually beneficial. Both the team and the organization have been profitable. In addition, intellectual capital is one form of capital that can be shared. When a knowledge worker shares his knowledge with a customer or a coworker, they do not diminish their own knowledge. In fact, through an exchange of ideas, the knowledge worker’s intellectual capital will grow as well. Concurrently, if our organization’s capital management process includes cross training the team members, the team can retain the exiting knowledge worker’s intellectual capital even as the knowledge worker leaves the team.

Through the process, the organization has gained in reputation, customers, reference sources, finances, experience and any number of other resources. The departing knowledge worker may also add to our social capital as an external influencer or even by bringing the new employer organization to our team as a customer.

Business is the process of providing solutions for others. As we continue to build our organizations, we must recognize the impact of the knowledge worker on our business models. As we provide a valuable package of organizational attributes that the knowledge worker can monetize their intellectual capital, we can help them grow. At the same time, we can increase our retained resources of financial, structural and social capital.

All in all, it is not a zero-sum game; everybody can win.

Reason to kill time sheets #17

In reply to a conversation with a member of VeraSage I wrote a really good paragraph and I thought I would share since it is TLFT (too long for Twitter).

One of the issues (with tracking time) is vagueness which is the enemy of accountability. Getting people to define the results is hard work; time sheets allow managers to be precise about the effort expected while leaving the results entirely vague. Thus someone who bills many hours can be considered a hero or an idiot depending on what the manager thinks of them.