INTERVIEWER: Ken, you've been writing about management and leadership for over 30 years. Tell us a little about how your perspective on leadership has evolved over that time. KEN BLANCHARD: If you look at the first edition of my book The One Minute Manager, you will see that in 1982, I had a hierarchical model of leadership. The one minute manager was the one who set the goals and decided how to praise and manage employees. I used terms like superior and subordinate to describe the relationship. Now, I see leadership as more of a partnership. Good leadership has three components: (a) clear goals, (b) day-to-day coaching, and (c) performance evaluation. It's the day-to-day coaching where the partnership occurs. When I was a professor, I used to hand out my final exam at the beginning of class. My theory was that it was my job to tell students what I expected from them (set clear goals) and then to teach them what they needed to know (dayto-day coaching) to get an A at the end of the class (performance evaluation). Gary Ridge, the president of WD-40 Company, was in one of my management classes, and he built his company's management system around this philosophy. At WD-40, once a quarter, people create report cards on goal areas. Every manager meets with every direct report every 2 weeks. The agenda comes from the employee. Everybody fills out one performance review, their own, and they give themselves an A,B,C,D. The manager's job is to agree or disagree with what the employee says. Once that's been done, the performance evaluation is easy because both parties know exactly what to expect. INTERVIEWER: In many of your books, you talk about servant leadership. Can you please tell us a little more about that? KEN BLANCHARD: Servant leadership has two parts: Strategy-It's the responsibility of the hierarchy to make sure the vision, direction, and goals for the company are set; and Implementation-The manager has to figure out how to help people accomplish their goals, which involves turning the pyramid upside down. Servant leaders ask, "How can I help?" and "What can I do?" My son, Scott, did a study that shows that 80% of employee inspiration and passion comes from the implementation or operational side of management. Most of the people closest to customers don't know about strategies-they just know about how empowered and respected they are. When they feel respected, they get passionate about their work, and they take care of customers. When the customers are cared for, they come back, and the money follows. INTERVIEWER: Why is employee engagement such an issue today? KEN BLANCHARD: Gallup came out with a study that showed that less than 25% of workers in America were fully engaged-their initial studies were a wake-up call for a lot of people. They've expanded engagement into employee work passion; if leaders get their people excited, then there's a real chance of getting more customers. INTERVIEWER: Do people have a harder time with the operational part of leadership or the strategic part of leadership? KEN BLANCHARD: A lot of top managers think that profit is the only reason to be in business, so they don't take people into account. That makes the operational part hard for them. But research shows that the bottom line is affected by employee satisfaction. Look at Chick-fil-A, Wegmans, and Nordstrom-top companies empower their people. My wife, Margie, is working to develop our "Office of the Future." She's found that the current generation (Generation Y) doesn't get "my way or the highway." INTERVIEWER: Why do clients seek your help? KEN BLANCHARD: A lot of people come to us because they've read a book, and they want to improve their knowledge. But employee engagement has gotten really big-people want to make people passionate. Our company has five divisions: 1. A learning-materials business that provides resources for individual learners to improve their knowledge; 2. A speakers' bureau that provides speakers for conventions and other large gatherings; 3. A training division that responds to requests for organizational training programs in areas such as self-leadership, one-on-one leadership, and building trust. We've just developed an online certification course for franchise managers that capitalizes on the motivational aspects of gaming. Participants get to make a lot of decisions, and they advance through different levels of competency; 4. A consulting human-resource development division that works with top managers; and 5. An international division composed of a network of independent partners worldwide. Companies also seek us out because we live by what we teach. We've found that three things contribute to getting people pumped up about their work: (a) cause motivation (employees like to work for a company that gives to good causes); (b) having a clear set of operating values (Johnson \& Johnson is a good example of this); and (c) being faithbased (work should be done to serve a higher good). At our company, we have all three of these in our culture. We truly see our employees as partners; we share our balance sheet with everybody in the company. We have a gainsharing program and a give-back program where we take 10% of profits and give them to employees to give to a charity of their choice. When business got bad in the 1990s, we used 1 day of a 2-day anniversary party to share the situation with employees. Half the employees were asked to come up with ways to cut costs, and half were asked to come up with ways to increase revenue. We got through the crisis and took everyone in the company to Hawaii to celebrate. I've transitioned from being the company's CEO to being the "chief spiritual officer." I leave an inspirational voicemail for everyone in the company every morning, and people seem to enjoy it. It's my job to keep repeating our values so that everyone in the company can live by them. anchard says that setting strategy is an important part of leadership. Even highly engaged employees will not make an organization successful if the rategy is poorly aligned with the environment. What must a manager do to exercise high-quality strategic leadership? Check all that apply. Embrace the many aspects of diversity in the workforce, in the customer base, and in all other stakeholders. Develop detailed plans that take into account resource availability and lay out clear timelines for implementation. Know the organization inside and out, including its culture, its strengths, and its weaknesses. Thoroughly understand the organization's current environment and possible future trends