By Marcel Schwantes, Principal & Founder, Leadership From the Core

Got a mirror handy? You might need one. In a recent post published on Chief Learning Officer, leadership expert Ken Blanchard (who has authored over 60 leadership books) shares this gold nugget of insight. He writes:

“In Good to Great, Jim Collins sets up an interesting metaphor using a mirror in the corner office to explain the difference between a servant leader and a self-serving leader. When things are going well in an organization run by a self-serving leader, this type of leader tends to look in the mirror, beat on their chest, and declare, ‘Look at what I've accomplished.’ But when things go wrong, this leader looks out the window to see who's to blame for the failure.

“Servant leaders approach it differently. When things go wrong, they look in the mirror and consider what they could have done differently. When things go well, they look out the window to see who they can praise.

“What kind of leader would you rather work for? By combining equal parts serving and leading, a servant leader creates a balance that creates both great results and great human satisfaction. Leaders who serve are the leaders we need today.”

Now that Blanchard has succinctly pointed the way to the truest form of leadership, let me ask you an honest question: Where do you stand as a leader? If you looked in the mirror, what type of leader would be staring back?

Using Blanchard's servant leadership framework to achieve the optimum balance of results and human satisfaction is quite the journey. But when you arrive, your organization will benefit from servant leadership's tremendous impact on both people and profit.

Here are three of the more glaring benefits:

Servant-leaders improve employee retention.

University of Illinois at Chicago recently conducted a servant leadership study of 961 employees at 71 Jason's Deli restaurants in 10 metropolitan areas in the U.S.

The research revealed that when bosses act as servants to their employees, it's good for business. Measurable increases in key business metrics like job performance (6%) and customer service (8%) were observed. But the biggest observation was found in employee retention (a whopping 50% increase).

In a short YouTube clip, co-author Sandy Wayne explains the benefits of servant leadership as much more than a nice thing to do for your employees; it's good for the bottom line.

Servant-leaders increase trust.

In his book The Speed of Trust, Stephen M.R. Covey highlights leadership trusting behaviors that are culturally ingrained in the structures of some great companies known for high employee engagement — Whole Foods, Campbell Soup, Semco and Deloitte. This is how their leadership teams and employees interact day-to-day. Among those trusted behaviors of servant-leaders are:

  • Creating Transparency: Being open and authentic, not hiding information, and having no hidden agendas.
  • Confronting Reality: Seeing the unvarnished truth, not skirting the real issues, and addressing the tough stuff directly.
  • Keeping Commitments: Following through, making sure commitments are kept, not breaking confidences.

Servant-leaders outperform the competition

A notable study published in James Sipe and Don Frick's book, Seven Pillars of Servant Leadership: Practicing the Wisdom of Leading by Serving, compared the companies made famous by Jim Collins's seminal classic Good to Great with companies that have been applying servant leadership principles. The research was based on the metrics Collins used to evaluate the financial performance of his 11 publicly traded “good to great” companies. They are: Fannie Mae, Circuit City, Nucor, Kroger, Walgreens, Wells Fargo, Altria Group, Gillette, Pitney Bowes, Kimberly Clark and Abbott Laboratories.

Those companies were then compared with 11 publicly-traded companies that are frequently cited in the literature as having servant leadership cultures: Toro Co., Southwest Airlines, Starbucks, AFLAC, Men’s Wearhouse, Synovus Financial, Herman Miller, ServiceMasters, Marriott International, FedEx and Medtronic.

The comparison focused on a 10-year period ending in 2005. They found that during those years, stocks from the 500 largest public companies (i.e., Standard & Poor's 500) averaged a 10.8% pre-tax portfolio return. The 11 companies studied by Collins averaged a really great return of 17.5%. However, the servant-leadership companies' returns averaged an astounding 24.2%. This means that servant-leadership companies are even “better than great.”

Bringing it Home

Edward D. Hess, professor of business administration and Batten executive-in-residence at the University of Virginia's Darden School of Business, is a top authority on servant leadership’s link to human high performance. Hess has authored 12 books, including his latest, Humility Is the New Smart: Rethinking Human Excellence in the Smart Machine Age.

He writes in The Washington Post: “Many people believe great leaders are charismatic, have a commanding presence, are visionary and educated at elite schools. Almost all of the leaders of the high-performing companies that I studied had none of those traits. Instead, they are what I call servant leaders.”

Describing a servant-leader’s intangibles, he further adds, “They were people-centric, valued service to others and believed they had a duty of stewardship. Nearly all were humble and passionate operators who were deeply involved in the details of the business. Most had long tenures in their organizations. They had not forgotten what it was like to be a line employee.”

Hess erases any doubt about the business impact of servant-leaders: “Employees in these companies have high emotional engagement, loyalty, and productivity and outperform the competition daily.”

On a closing note, I’m reminded of Howard Schultz, former chief executive of Starbucks, also a long-time servant-leader. In 2015, he wrote an inspiring op-ed in The New York Times even calling for a servant-leader to be our next president (while quickly dismissing any rumors he would be running against Trump or Hillary).

Acknowledging a servant-leader’s diverse ideologies and deep respect for humankind, whether in a business or political landscape, Schultz writes:

“Our country is in desperate need of servant leaders, of men and women willing to kneel and embrace those who are not like them. Everyone seeking the presidency professes great love for our nation. But I ask myself, how can you be a genuine public servant if you belittle your fellow citizens and freeze out people who hold differing views?”