1. Sense of purpose
Bogle begins his discussion of leadership by quoting Warren Bennis’ famous list of distinctions between managers — who have a short-range view and an eye on the bottom line — and leaders — who have a long-term perspective and an eye on the horizon. To Bogle, it all boils down to the single most important trait of leadership.
“Serving a sense of purpose, a sense of where we want to go and commitment to get there ethically — basically a strong moral compass — is an extremely important part of leadership,” he says.
Because you can’t lead without followers, the point is to inspire them with a common mission. So an important aspect of having a purpose is articulating it clearly.
“I don’t think we have nearly enough leaders who have an ability to take advantage of the power of words,” says Bogle, who takes communication into his own hands and looks to passionate writing, from Greek and Roman philosophers to the founding fathers to the Old Testament, for inspiration. “Writing a speech or a message to your associates is something that is extremely high on my priority list. It had to be my words, not written by the public relations department. It has to come directly from you.”
In Vanguard’s early days, for example, Bogle addressed his employees every time the company passed a billion-dollar milestone. Then it was every $10 billion, then every $100 billion. The point is that you get up in front of them and share where the company is and where it’s headed.
“You stand up and speak to them in your own words, a sort of state of the union address,” he says. “Write it in human terms; don’t make it too business-like. Write it. Prepare it. Let them know you’ve gone to the trouble of wanting to make sure they’re informed.
“I’m absolutely convinced people can spot a phony around a thousand yards away. So I guess I’d have to say that another attribute of leadership is, for God’s sake, be yourself.”
Q. What are the keys to communicating your purpose?
It’s to share your passion for the enterprise but also the mission of the enterprise. Here at Vanguard, my task is to create a company that was of the shareholder, for the shareholder and by the shareholder. You’d be amazed how many thousand ways there are to communicate that.
So it’s like, ‘Well, are you just going to repeat it again and again?’ I almost never repeat it in those words. You can express that commitment, service, stewardship in a thousand different ways. If you’re reading a little bit of history, you can also find quotations that are even better written than you can write them and use them effectively.
Communication, in many respects, must be repetitive. We all have short attention spans. But you can do it in so many ways and, in a certain respect, people don’t even know it’s being repetitive.
Q. How do you gauge whether employees are on board with your mission?
In a way, that’s a good question, and in a way, it’s a bad question. As I say in one of my recent books quoting Einstein, ‘There’s some things that count that can’t be counted, and there are some things that can be counted but don’t count.’ I think we can go off the deep end in trying to measure that kind of thing.
We do, of course, surveys of our shareholders. We participate in independent surveys. And we get the top scores there; that’s encouraging that our people are carrying out this mission. But it’s a confirming — it confirms your view of the facts [and] … the reality of how people are reacting.
We do something we call Crew’s Views and ask our crew members, in an anonymous questionnaire, how they feel about their jobs, their futures, their careers, their opportunities, the management and the compensation. We do get a statistical feeling from that, but I still think personal feelings are the biggest important part of it.
How do you measure something like integrity? How do you measure something like commitment? I don’t know how you measure them. Does that mean they’re not important? No, not at all. They’re the most important attributes of all you do.
I hate this management consultants’ bromide: If you can measure it, you can manage it. What a horrible thought. Think of how our corporations are doing that: If you can measure their earnings, you can manage their earnings. I’m not happy with people trying to sell me something because they got a bunch of numbers — not that the numbers aren’t useful as a supplement. I want to be very clear on that. Particularly in the financial business, you can’t work without numbers. But numbers are the cart and not the horse.
Other than these formal surveys, [gauging commitment is] not an easy thing to do because you can really only do it anecdotally. So the only way you’re really going to get comfortable with how people feel is to talk to individuals.
I always hated the idea of employees so we call them crew members. We’re very nautical; you know, Vanguard was Nelson’s flagship in the Battle of the Nile, a great naval victory. You know, you can’t talk to 12,000 people. So you do it anecdotally. You do it regularly. You observe when you’re going over to the galley for lunch how people seem to be feeling. You
019;re standing next to people in line getting your sandwich; you chat with them — very unscientific. But at the end of it, I think you get a pretty good feeling of how things are going.
