Leading with Wisdom

By Coffin, Bill | Risk Management, September 2008 | Go to article overview

Leading with Wisdom


Coffin, Bill, Risk Management


Shivan Subramaniam

As the chairman and CEO of FM Global, Shivan Subramaniam oversees the strategic and operational direction of one of the world's largest commercial property insurers.

As a veteran executive with experience in a number of fields, Shivan Subramaniams views on the executive challenges in a world increasingly focused on risk management have proven especially insightful. Here he discusses what it means to lead an enterprise at a time when the job seems more difficult than ever before.

Executives are expected to deliver a road map to the future from the top office, but at the same time, grassroots Innovation from the rank and file can be Just as Important. How can an enterprise cultivate both In concert with each other?

I've always believed that innovation cannot just come from the people at the top of an organization. In well-managed companies, innovation also is encouraged from the grass roots. Those ideas, in turn, stoke the imagination of management, and, through a collaborative process, can result in innovative ideas, approaches, products and services. In the long run, the most innovative organizations seek ideas from the company's leaders and every employee.

It has been said that it is better to be loved than to be feared and that good leaders should Inspire more than they Intimidate. Yet, there are plenty of companies with heavy-handed bosses and cultures that have been successful nevertheless. Is one approach really better than the other?

Management by intimidation might work well to achieve short-term results or in small organizations that require a certain kind of focus. Or, such an approach might work in an organization where a situation, like a crisis, needs to be addressed, and a single voice of authority is needed to focus on the issue at hand. But if you want to have a successful organization with valuable products, services and dedicated employees, the only long-term model that will work is leading by inspiring.

What is the difference between being a leader and being a boss? And does that difference really matter when you're running a large multinational firm where the CEO Is unlikely to work alongside the cubicle-dwellers? How can you really make leadership be felt down through the ranks In a meaningful way?

Because FM Global has long-term employees with an average tenure of 13 years, almost everyone in a leadership position in our organization has at some point in their careers rolled up their sleeves and been on the front line. Virtually all of FM Global's management has worked from the proverbial "cubicle" at some point in time. So our management understands firsthand what's involved day-to-day. As one climbs into the ranks of management, the higher one climbs, the more important it is to influence and inspire, rather than to be a boss. Leaders really transition away from telling people what to do and toward surrounding themselves with people they can talk with regarding what are the best things to get things done, ways to achieve that and then get them executed. In my experience, bosses tell people what to do. Leaders help people find their own way to get things done.

The high-profile boardroom dispute between Carl lcahn and the Yahoo board of directors in the wake of the failed merger with Microsoft shines a light on the pressures executive leaders must shoulder. What are your thoughts on situations when a firm's leadership and the rest of Its stakeholders have different Ideas about what is best for the enterprise?

This sort of thing makes me very glad that FM Global is a mutual company, owned by our policyholders, and not publicly traded. We don't have the kinds of issues a publicly held company might face because we have a single focus and a sole purpose-to meet the needs of our clients. In publicly traded companies, by contrast, it's the board of directors who ultimately represent the interests of the investors. …

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