Leadership is lonely. Yet, we rarely expect this and often cannot understand why it is. Today I want to focus on one moment in my career, which represents the roles I usually take. Most of my career was built in corporate finance and corporate strategy, but largely around turnaround, transformations, and restructurings. That’s even more lonely as a leader. Turnaround, transformations, and restructurings are often the least popular engagements due to their intensity and the need to make unpopular decisions. I want to show you why leadership is lonely and how this loneliness can benefit you.

Struggling Office

When I was a twenty-five-year-old associate, my office was underperforming. Over three years it had slowly shrunk to the point that the firm was considering closing the office. This would have been the first office closure ever and not something the firm wanted to be publicized.

Eventually, I was one of the last of about five consultants left. As the decision to close was being debated, administrative functions like payroll, etc. were transferred to another hub. This was a normal course of action and did not worry us too much. A few weeks before all of this happened, I had worked with a principal, my mentor, to deliver a letter of proposal to a major utility client to develop their twenty-five-year forecasted portfolio planning for their fleet of power stations.

This was a challenging assignment where we would adapt the principles of investment portfolio planning to capital assets. It had not been done before, was considered highly theoretical, and would require a formidable engagement team to deliver the work under the best conditions. Many within the firm believed this engagement would fail. It was challenging statistics and math, and several people had tried and failed to do something similar. We were collaborating with the professor who had first proposed the theory, but he had not been able to prove it could be done in the real world.

By the time the client signed the contract, the principal had already resigned but had agreed to stay as a contractor to lead the study. I would be the engagement manager with one new business analyst. By this stage, most of the support functions in the office had resigned and we were working as a skeleton crew. This was a significantly understaffed and underskilled study. I accepted this task because I believed in myself. I believed I could anchor this engagement and see it through. It was also a unique problem for an interesting client. I could have resigned or transferred offices, but I wanted to work on this issue.

Extreme Difficulties

The principal would only be working on the engagement three days a week. So it was me and the very young business analyst carrying the entire weekly workload. Efforts to bring in the only two remaining associates in the office failed since they both resigned to take on industry roles. No one wanted to be the last person standing in a soon-to-be closing office. Everything pointed to this being a tough eight-week engagement.

Due to the administrative handover, our salaries after the first month had not been paid nor were our expenses reimbursed. Now, I was sure we would be paid. Yet, you can imagine how a twenty-five-year-old would feel. No salary. Expenses not reimbursed. No idea what would happen. Understaffed. Leading all of the study. I had to block all of this out and just move things forward. Leadership is about not hoping for things to change. It’s not about asking and pleading. It’s about working with what you have and taking what you need to see it through. There is always a way to see it through.

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Day-by-Day

I had a vision for this engagement. Despite the odds, from the beginning, I had the certainty that I could not only deliver this engagement but turn it into a defining study. It’s my mindset. I know I can always turn the tide no matter the odds. I have over the years developed philosophies, tools, techniques etc,. to do just this. I had to spend a lot of time consoling the business analyst. She was honorable and kept me updated on all her interviews to find a new role. I supported her by letting her attend as many interviews as needed. At the end of the engagement, she left the firm with about a week left in the study. In the last few days of the engagement, I worked alone wrapping up the study. Yet, a lot would happen before we got to the last week of the engagement.

I had forty days and I managed things day by day. This is key. Each day was managed as a contained unit. No matter what happened before and how things may have ended at 1 am when I went to bed, if I slept that day, the next day was new. A total reset. This was the only way to survive. I, of course, had a rough plan but I had to make adjustments daily. I would get up around 6 am, shower, and plan my day as I drove into the client’s head office around 7 am. The office was no more than five minutes from my apartment. It was usually deserted that early, and I would prepare an espresso and order a pastry from the cafe. We were given an office within the EVP Strategy & Planning division. We were physically so close to the client that they would all have to pass our offices when they came in or attended meetings. They were always watching us.

When you have a situation where an office/company/unit is closing/underperforming, most people are not inclined to do the work. They just don’t care, and they know there will be little repercussions. Leaders need to accept this and work with what they have. Hope is not a strategy. Why would someone spend extra time developing ideas or doing extra work if they are fairly confident they will soon leave? Why invest in something with no future? This is the core challenge of leadership and where the lonely part comes in.

When no one buys into your vision of what could be, you, as the leader, are left pulling forward at all times, pushing for something better, and being optimistic about what is possible. Few attend meetings. No one contributes. Vital tasks are not done. Work is rarely done since they will often not be around long enough to shoulder the consequences. Meetings are transactional when they do occur. No one does more than the bare minimum. If you are the leader with the vision, you are left alone to pull things together. You must become a generalist who can step into all roles as everyone peels off. It does not matter how often you ask for help or explain things. Until you stabilize the ship and show glimmers of success to attract new people to join the cause. You are alone.

Steve Jobs often attributes his health issues to having had to drive things so hard to turn around the fortunes of Apple. I do not know how true that is, but it takes a unique person to go to the front of the team and lead them through the darkness ahead. It’s easy to lead when there is success and ample cash. It’s completely different to lead when there is nothing there. Inky blackness.

In addition, the client had constant concerns about the team size and the absence of the principal and business analyst, and I had to comfort them while doing the work. It was not a great situation.

“I Can’t Fail”

The system had already failed. We have already been set up to fail. That was a fact at the start of the engagement. There had been institutional failures that approved and understaffed this engagement with one full-time consultant and business analyst. If I was handed something set up to fail, it cannot be my fault if it fails. By not taking it personally, I can focus on what is important. This is critical. You have to distinguish between your failure and that of the system. When we merge them, we often take things personally. Yet, by knowing we would fail without drastic and radical changes, I had the mental permission to make those changes from the start. Too often, we listen to everyone else and hope for the best. I believed what I saw and not what I was told.

In consulting, I acknowledge many would try to blame me if this engagement failed. It’s the same in the corporate world. Yet, I knew that for eight weeks, this is my domain, and I get to run the show, and my job is to make this the leading study of its kind. I will deal with what comes after the eight weeks.

Taking Charge

During the Cold War, the Soviet Union was far behind the USA in developing microchips. Their chips had low yield, memory, and computational power. Yet, they had gifted programmers. To overcome this hurdle, Soviet programmers learned to write efficient code. They wrote fewer lines of code to accomplish what Western programmers could do. Therefore, they could coax out comparable output/performance from inferior microchips.

In this study, we would build a model to estimate the mix of power sources to supply electricity across the subcontinent to lower the cash flow at risk and costs and increase the returns for the utility. We also had to predict when to build new power plants. Finally, we would produce an efficient frontier. This is discussed in many posts, including here, and within SCRA and StrategyTraining.com.

One of the most critical and controversial decisions I made was that the principal would lead the model building. This never happens. Yet, there was nothing typical about our situation. It made sense to me. I and the business analyst were on site every day with the client. I should serve the role of the primary client contact and manage the client. The principal agreed, and we would help him as needed. This is not common at all in management consulting. Yet, I was the point person, and I had to make the decisions to get this done.

I also took the lead in building the architecture for the model. In other words, I took the lead in designing the study. The principal had sketched out the broad outlines of the study for a much larger team. I had to redesign our approach. It was clear to me that we needed to strip down the study and modelling to only do the work that needed to be done. We had to have a crystal clear view of what question we were trying to answer and build the simplest model to do it. I recall receiving an email from a specialist in a German office who suggested we experiment using neural networks to build the model. This was the opposite of going back to basics and we did not pursue this path.

We also needed to work with the client’s internal statistics, planning, and corporate finance teams to ensure they could use what we were doing

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Stripped Down Leadership

I focused on leading the overall analyses, aka model architecture, and explaining what we were doing to the client. The principal built the model, and we helped him, and the business analyst documented everything: slides, assumptions, data collection, data verification, etc. Three clear tasks and nothing else.

The Strategy & Planning offices had a common lounge with an automated coffee and espresso machine. I took over that lounge and made it my command post. I mistakenly assumed I was allowed to do so, but no one said otherwise. I built this enormous chart explaining what we were doing, how the new modeling technique worked, and why it was important. The chart was about 6 m by 12 m. Strategy comes down to the client understanding what to do and why. Today, too much of strategy is about producing complex charts and analyses. Communication is a forgotten art form, and it is often the difference between a great and good strategy intervention.

My job, which I had given myself, was to wait for important executives or anyone critical to this process and ask them if they wanted to understand what we were doing. I would spend about an hour to two hours explaining the concept and simulating the board discussions. If anything came up that was useful to modify our approach, I would put a sticky note on the chart and email the team in the evening. The board discussion simulations led us to understand the importance of using the efficient frontier (see the links earlier) to anchor the board discussion. This meant that all of our analyses and work would be presented in just one slide. That, in itself, is a pretty significant departure but it worked and made sense.

That is all I did. That was it. That was my focus. I drank espresso (this was before I realized I could not process caffeine). I talked and presented. For six weeks. From 8 am to 6 pm. It worked so well the client’s Strategy & Planning employees would fan out and bring in executives whom they felt needed to understand what was happening. We did not present in any other format until the final update which was largely a discussion around one slide.

We combined many steps from the Strategy Journal (Strategy Control Room Advanced / SCRA). We kept updating the 6 m x 12 m chart with the latest numbers and this became our pre-presents. It was an all the time and real-time strategy of pre-presenting. And it worked and was very popular. The lesson here is that you must truly understand the fundamentals of anything if you intend to simplify it.

This is leadership. You face what seems like an impossible task. You have agreed with the client to answer a question that requires a significant team. You do not have a proper team. You have what you have. How can you answer the question correctly using what you have? How can you not bemoan what you don’t have and what could have been?

Keep Advancing

No one was perfect on the team. I certainly was not. The principal was launching his consulting firm and was tied up in other initiatives. Did he work the full three days per week? No. Did it make sense to discuss this with him? No. I did not have the time, and it would not change anything. It was not even my place to do so. Did the business analyst come in happy and excited every morning? No. Yet, she came in. We advanced and improved. We had short meetings each day to correct our course.

As a leader, you have the vision. Only you can see what is possible. Others will likely have given up. As an aside, early in my career, I was briefly appointed as the chief-of-staff to be the CEO. At the time, things did not look good. I sat in those board meetings and watched his executive team do only what they were asked to do. Nothing more. Not even a little. That is human nature. When people see no future in something, they refuse to invest more than they can get away with. Did it bother or frustrate the CEO? No. He kept advancing. He also fired his legal counsel in that first board meeting.

I had a vision of what was possible here. Each day I spoke to the client, I was more and more convinced that what we were planning to do would help them. It was unique and would give them a competitive advantage. Most days were challenging. Yet, to have deep discussions with the EVP of Nuclear Engineering, Chief Statistical Officer, and CFO often and help them shape their thinking, how can that be a failure?

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Leadership is Not a Reward

We think of leadership as a reward for past achievements. Sometimes, it is, but only if you define leadership as managing more and more people. Leadership is about fixing something that people are fleeing or building something that does not exist.

This engagement was effectively a dead engagement. Most engagement members would have left in similar circumstances. The client would have been displeased. Nothing new would have been done. The field would not have advanced.

I saw a different vision. A chance for me to serve in a far more senior role than normal. The chance to do something remarkable for the client. The chance to push the field of risk forward. It started badly. Scrambling on all sides. Yet, as each day passed, people realized we were doing something important. They either came to us to find out what we were doing or were sent to us. From fleeing an expected wreck of a study, the client started coming to us.

That is the core of leadership. You are the lonely soul who sees what is possible. You have a vision. Only you have this vision. You slowly start creating something. The magic starts, and others follow.

Rewards

The rewards from this engagement were significant. The risk ideas we had been developing for several years finally coalesced into the approach we developed for this client. We effectively built the risk strategy practice off this study, which is considered the bible of the field within the firm.

Based on the fees from this engagement, including the bonus and at-risk fees, we were able to anchor the office, and it did not close. This engagement had been so difficult that it essentially forced me to grow as a person. I did not need to ask for promotions from this point in my career. I was always able to become the person that the firm promoted.

That said, I did leave the office due to disagreements. Yet, that is for another post.