The following is a conversation between Steven M.R. Covey, Global Practice Leader at FranklinCovey & author of Trust and Inspire, and Denver Frederick, the Host of The Business of Giving.

Denver: We have a leadership crisis today. Despite our world having changed dramatically, our leadership style has not. According to my next guest, our way of leading organizations is seriously past its sell date. He is Stephen M. R. Covey, Global Practice Leader at FranklinCovey, speaker and the author of a number of bestselling books, including his most recent, titled, Trust and Inspire.

Welcome to The Business of Giving, Stephen.

Steven M.R. Covey, Global Practice Leader at FranklinCovey & author of Trust and Inspire

Stephen: Hi, Denver. Great to be with you. Excited for today.

Denver: Likewise. You say the world has changed, and I think we’ll all agree with that, but you also say our style of leadership has not. Tell listeners what’s happening and what your research has turned up.

Stephen: Well, we see the way the world has changed, with technology and disruption, the workplaces changing with work from home, work from anywhere, remote/hybrid, intentionally flexible work. The workforce has changed with so much diversity– as many as five generations at work.

And then suddenly people have all these choices and options in a way that they didn’t have just a few years ago. So it’s a new world of work, and yet, the way that we’re leading, for most of us, most organizations, most leaders, still is kind of the old model, what I call “command and control.” More the traditional, hierarchical-type model.

Now how we’ve improved it is we’ve become a little bit more advanced, more sophisticated. We brought things like emotional intelligence and strengths and mission and trustworthiness to it. But we haven’t shifted our paradigm on how we view people and how we view leadership. So it’s kind of an enlightened command and control, a better version of it.

But we still kind of use people like we would things. We try to get results through people, but people are just a means to an end, and not one of the ends in and of themselves. So I think we need to shift from this command and control model– whether authoritarian, kind of the real traditional, or the enlightened, the much improved version of it– to what I call “trust and inspire,” where it’s self-governance.

And it is a completely different model of how we view people, how we view leadership. And it’s a better way to lead in this new world of work because it’s going to create the kind of culture, a high-trust culture that inspires people. And we’re going to attract them; we’re going to keep them. We’re going to… they’ll stay with us because they like to be trusted and inspired.

But it also helps us collaborate better, partner better, innovate better in a way that you’ll never achieve with command and control. So we’ve got to just shift the way that we lead to be relevant for our time. And command and control is dying; trust and inspire is thriving. It’s where leadership is going.

Denver: Yeah. Yeah. That’s a great overview. And some enlightened things that leaders say that our most important asset are our people, you’re calling them an asset. You know what I mean?

Stephen: Exactly.

Denver: Like a mineral.

Stephen: Like a mineral. Yeah. The sentiment is good, right?

Denver: Yeah.

Stephen: I’m trying to say we value people, but that’s part of the command and control paradigm, that people are assets or things.

Denver: Things, yeah.

Stephen: And so you use assets to get results as opposed to seeing the asset, the people, as one of the results themselves. I’d like to say, rather than getting results through people, how about getting results in a way that grows people?

Denver: Yeah. Yeah. That’s really well said. Well, for people who are just getting familiar with this, why doesn’t command and control, that kind of culture, work anymore, if it ever did, in building trust?

Stephen: Well, because it’s too dictatorial. It’s too directive. And I’m not against having vision and direction, but it’s too much one-sided. It’s kind of: What I can do for you– A little transactional exchange. In its worst form, it’s what I can do to you. That’s the authoritarian command and control.

But the enlightened is: what I can do for you. That doesn’t sound bad. But it’s a little bit transactional and a quid pro quo type of thing, whereas trust and inspire is what I can do with you. It’s a sense of partnership. And you’re working on inspiration as opposed to mere motivation.

Motivation is external, it’s extrinsic, so you use carrot and sticks to try to motivate people to move them. And do rewards work? Sure, they motivate people to want to get more rewards, but it’s all external and you got to constantly provide more stimuli, external stimuli to move people.

Now inspiration may contrast. It’s internal, it’s intrinsic, it’s inside of people. We try to light the fire within. And when that fire gets lit, it can burn on for months, if not years, without the need for constant stimulation. And you can’t command and control your way to a high-trust culture that inspires people. It doesn’t work that way. You can’t command and control your way to collaboration and innovation.

But trust and inspire is a far better way of doing that. And in fact, if you even look at the word “inspiration,” inspire comes from the Latin term “inspirare,” which means “to breathe life into.” You breathe life into relationships, into teams, into cultures, whereas command and control tends to suck the life out of. And so we need this kind of inspiration, that we need to light the fire within.

And that candle, once lit, can light a whole lot of other candles. And that’s the great thing about The Business of Giving and the whole philanthropic world and doing good, is that can tend to light a lot of candles that can light other candles and really become a virtuous upward spiral of what we can do. So we need more inspiration. We not only need more trust, we need more inspiration.

Denver: Yeah. Yeah. Well, I took three years of Latin, and I didn’t remember that, so thank you for the reminder course. I said, Oh, yeah, yeah, he’s right. Now it’s coming back to me.

Well, you talk about winning in the workplace and winning in the marketplace, and boy, both of them are important. Which has precedence? Which comes first?

Stephen: Yes. I’ll tell you what comes first, winning in the workplace, our own people. There is a sequence. Both are vital. And we know we have to win in the marketplace. We have to be relevant. We have to create value and add value, and especially when there’s so much change and disruption. So if we’re not innovating and staying relevant, we’ll fall behind. But there’s a sequence; there’s a prioritization.

The way that we will sustain winning in the marketplace with our external stakeholders is because we first are winning within the workplace with our own people, and they know it and they feel it. Think about it this way. It would be incongruent to ask people who you don’t trust to go out and build trust with stakeholders, with donors, with causes, and you don’t trust them. That’s incongruent.

But it is natural and abundant to ask people who you trust to now go build trust with our external stakeholders and partners. It’s inside out and too often we try to go outside in because we know we need to go out, and we need to have that impact on the marketplace. But the only way out is in. We’ve got to start with ourselves. And so winning in the workplace enables us to sustain winning in the marketplace.

Denver: Yeah, I’ve always said that marketing is the promise a company makes to a consumer, and it’s the employees who deliver on that promise. And that pretty much sort of encapsulates what you’re saying there. And that you really… that’s where you have to do it because they’re going to be the ones who deliver on what you just told your consumer what you’re going to give them.

Stephen: They are the brand and their experience. And when you’re in command and control with them and they feel that, then their experience of how they go out with it will be different in kind than if you trust them, if you inspire them, if you believe in them, if you give them opportunities. And they feel that trust, and they tend to then emanate that out, inside out, in all these things.

It’s a simple idea. It’s just not easy because we’re very focused kind of outside in instead of inside out. And we come from a world of command and control. This is what we know, this is what we were raised in. It’s what we’re good at. And it’s worked for us maybe in the past, but it’s not going to work in this new world of work.

Denver: Mm-hmm. Right. Right. Well, let’s look at this continuum you’ve just set up. You’ve talked about the command and control. You’ve talked sort of in the middle a little bit, the enlightened command and control, and then you’ve talked about the trust and inspire.

How many companies, organizations, would you put into that command and control framework? What percent?

Stephen: There’s some research out there that shows that about 30% of organizations today would be in the authoritarian command and control, kind of the original, that’s the real kind of top-down organizations. I see them all the time. There still are some. You might think there are not that many, but there’s still quite a few.

Denver: Oh no, I know. I used to work at the Statue of Liberty for Lee Iacocca of Chrysler.

Stephen: Uh-huh.

Denver: And when I think of Detroit, I thought of a command and control city that you really… pretty much, it came from the boss and everybody marched to that tune.

Stephen: Yeah. And that still exists. But it’s at 30%. If we went back four decades ago, five decades ago, it might have been at 80%…

Denver: Eighty, yeah.

Stephen: …type of thing. But where we’ve seen a lot of movement is from that into the enlightened command and control. Enlightened command and control, the data shows it’s about 62%.

Denver: Okay.

Stephen: That’s a big improvement from being in the authoritarian side, but that means that we’re only at 8%…

Denver: Wow.

Stephen: …with trust and inspire self-governance. So 9 out of 10 organizations are still operating in some iteration of command and control, even if it’s a better version of it. The paradigm still is people are things and people are being managed like things. People don’t want to be managed. People want to be led.

Denver: That’s a great distinction.

Stephen: They want to be trusted. They want to be inspired.

Denver: And that’s really good context, I think, for listeners. You sort of get an idea of what this paradigm is looking at right now.

Stephen: Yeah.

Denver: I think a lot of people think they’re much more in that trust and inspire than they really are. It reminds me of this old joke, Stephen, when if you had… I think it was, if you have a log across the stream and you have 14 frogs on the log and 10 decide to jump in, how many frogs are left on the log?

And the answer is 14 because deciding to jump in and jumping in are two entirely different things. And I think we have a lot of trust and inspires who’ve decided, but they’re still on the log. And…

Stephen: I like that. That’s a good metaphor. I put it this way, that oftentimes our style gets in the way of our intent. So our intent is to jump in, to jump off the log. We want to do this; we believe in it. Sounds good, and we believe in it, and it kind of describes who we are inside. But sometimes our style, what is manifest,  how people experience us, is still kind of more of the old model. So our style too often gets in the way of our intent.

Denver: Another metaphor for that, if I may, is Tarzan. I always think of Tarzan on the vine, and he’s holding on to the command and control vine. And he sees the trust and inspire vine, but he’s got to let go. He’s got to let go and fly through the air with no vine to grab.

And he’s really determined… she’s really determined. But you know what, I’m just going to hold on to this vine a little bit longer. Next time it comes around, that’s the time I’m going to jump.

Stephen: I love it. That’s a great metaphor. Yeah, because we want to make sure this is going to work, and we’re a little bit… we’re not quite certain, and especially when we know the old vine does work. I mean, or at least it has worked in the past.

Denver: It has worked. Exactly. Why bite the hand that feeds me?

Stephen: Right.

“…the biggest barrier to becoming a “trust and inspire” leader is that we think we already are one.”

Denver: I mean, look, I’ve had a lot of competition in my life. I’ve gone to the top of my department, or my division, or my organization. Why would I want to change? And I mean, how do you convince people to say, “You got to let go. You got to make that leap before it’s too late.”

Stephen: Yeah, we have to kind of confront the reality of these changes, this new world of work. And to recognize that, look, I’ll paraphrase Marshall Goldsmith, “What got us here won’t get us there.” The style of leadership that brought us to where we are today may have worked in the past, but it’s not going to be the style of leadership needed to get us to where we need to go tomorrow because it’s a new world.

Everything has changed. People have choices and options. And when they’re not trusted and inspired, they’re going to go find a place where they are. They’ll leave. We need good management, but we need good leadership. We manage things, but we lead people. And too often, we get so good at management, we start to manage people as if they were things.

And if we keep doing that, we’re going to end up with no people and a lot of things because they’ll go elsewhere.

Denver: Right.

Stephen: They have choices and options today in a way that they didn’t have before because I can live here, work there, and with remote/hybrid work, but also with just the new gig economy, all these things that have just come up suddenly puts a premium on being able to attract, retain, engage, and inspire the best people and bring out the best in people. So yes, we have to kind of confront reality that the world has changed.

But also, we can say, “Hey, this vine served me well in the past, but in this new world, I need to shift to a new vine.” And that can work just as well, even better. And maybe there’s a greater possibility I can take my leadership to another level and really unleash the greatness of my people and my team in a way that I haven’t fully in the past, although my intent has been. And so see the possibility of actually a greater outcome.

That’s what I think is in front of people. And I think that intuitively, people know it and feel it inside that there’s more that we can bring out in our team, in our people and in ourselves. And so I think it’s inside of people. I think they feel it. But I will say this, to the point you and I were talking before we started the podcast, that perhaps… I say this, that the biggest barrier to becoming a “trust and inspire” leader is that we think we already are one.

And it’s very easy to kind of say, Well, I do this. And I think it’s that your frog analogy, that my intent is there; I believe this, I believe there’s greatness inside of people, and I want to unleash it. That’s my intent, my heart. But our style might be getting in the way of our intent. And how are our people experiencing us?

Do our people who we lead, do they… how do they see us in terms of seeing and unleashing their potential for greatness?  And so it’s not just how we feel about it, but do they experience it? How do we show up for them?

“And I’d really like to focus on how leadership ultimately is stewardship. Not about our rights, it’s about our responsibilities. And it’s about influence, not position. So these are stewardships. These are responsibilities we have. These are jobs with a trust that we have as a leader for the people who we lead. And they’re simple.”

Denver: Yep. Yeah. I think you’re absolutely right. I think there’s a lot of leaders who say, “Hey, the last meeting, I didn’t sit at the head of the table. I let somebody else sit at the head of the table. I’m a trust and inspire leader.”  It’s like, no, you’ve gotten like one degree. You know what I mean? You got to go a lot farther than that.

Well, you talk about the three stewardships that move a command and control leader to trust and inspire. Why don’t you run down those three of what we need to do, an individual needs to do, to become that kind of a leader.

Stephen: Yeah. And think of the word “stewardship.” Stewardship is a responsibility. It’s a job with a trust. So these are responsibilities that are implicit in leadership. And I’d really like to focus on how leadership ultimately is stewardship. Not about our rights, it’s about our responsibilities. And it’s about influence, not position.

So these are stewardships. These are responsibilities we have. These are jobs with a trust that we have as a leader for the people who we lead. And they’re simple. There’s three, as you said. We model, we trust and we inspire. Modeling, trusting, inspiring. Modeling is who we are. Trusting is how we lead. Inspiring is connecting to why it matters. We model, we trust, we inspire.

It’s that simple, but that difficult, too, and because that’s not easy. So we need to go first as a model and model the behavior we would like to see. If we want more transparency, we model transparency. We want more respect, we demonstrate the respect that we would like to see. If we want more trust, we give the trust that we want to see.

So we model the behavior. We trust. The whole idea here is, it’s not enough to be trustworthy in order to have trust. It’s necessary…, got to be trustworthy, but I’ve seen two trustworthy people working together. Both trustworthy, and no trust between them.

Denver: Sure.

Stephen: Because neither person is willing to extend trust to the other. So in addition to being trustworthy, we need to be trusting the leaders. That’s the bigger gap, I find.

Denver: Oh, no, you’re so right. And sometimes it’s great to have trusting be the default. I don’t know where you come down on this, but I hear you have to earn my trust. And I’m sometimes thinking: Look, we just hired you. You went through a process, we checked you out, I’m going to assume that I’m going to trust you. Not that you have to prove it to me because when you make that the default, it just changes the relationship in such a profound way.

Stephen: Oh, Denver, you are so on on this. It literally changes the relationship right out of the gates when you start with trust. Can I give you a little example of that…

Denver: Please do.

Stephen: …from the nonprofit sector? So the giving sector, Gail McGovern, president, CEO of American Red Cross.

Denver: She’s been on the show several times, one of my very favorite guests.

Stephen: Yeah. Well, she’s amazing. She’s a wonderful leader. She told me this story just a couple months ago. When she first got in as the CEO of the American Red Cross, she kind of went on a listening tour and tried to go around the country and talk to the different offices and present the vision and everything else, but also to listen to people.

And they had, prior to her coming in, they had a few different leaders over a very short period of time.

Denver: Every couple of months.

Stephen: Yeah. Yeah. So this was kind of a lot of transition going on. They had a great mission, but they were struggling with some of the internal strategy and the business model, if you will, to make it all work. Their mission was always great. Great people, but struggling to try to figure out the best way to implement this.

So she comes in, and she goes on this listening tour. At one of these events, someone had the courage to say, “Gail, you’re new, and we’ve had all these changes, all these prior leaders, and now it’s you. How do we know if we could trust you?”  And her response was, you know, “Well, you’ll have to decide that for yourself, but I hope that you’ll find in me someone that you can trust.”

“I believe you will, but I want to tell you something.” And then she looked at everyone in the audience.” I trust each and every one of you.”

Denver: Wow.

Stephen: That’s what she said to this town hall meeting of American Red Cross employees, associates. They asked, Can we trust you? How do we know we can trust you? She said, You decide for yourself, but I know I trust you. And…

Denver: She went first.

Stephen: She went first, and leaders go first. She went first. Her default was, I trust you. We hire winners at the Red Cross. We hire great people.

Denver: Yeah, they do.

Stephen: My starting point is: I trust you until you give me a reason why I should not. But like you said, Denver, that immediately transforms the relationship, with the leader going first. Because people were asked there, what did that do to you when Gail said, I trust you? To a person, they said,” I was inspired by it. I wanted to live up to it. I wanted to prove the trust justified, and I trust her right back.”

Denver: Yeah, that’s great.

Stephen: Generates a reciprocity.

Denver: She’s a great leader. Now, if I may, can I tell you a Gail McGovern story, even though it’s a little bit off point? Because I really just respect her and admire her so much. But she had come from the telephone company and she remembered this story from the telephone company, and she brought it with her to the American Red Cross.

And there’s these two guys, and they’re on a highway, an interstate, and what they’re doing is laying telephone poles. And the two of them are together, and they’re looking down the interstate, Stephen, and they’re looking for miles, sort of like an Oklahoma type of thing. You can look forever.

And one guy says to the other, Oh my gosh, look what’s in front of us! We’re never going to be able to get this done… or we’ll never finish this. At which point, his partner tapped him on the shoulder and said, “Look behind you.” And he looked behind him and as far as the eye could see, telephone poles were going up, had been up.

And she said, I’ve always remembered at the Red Cross, where so much we haven’t done, there’s so much in front of us, but as a good leader, a great leader, you need to take a moment and to look behind you and see how far we’ve come.

Because it really can motivate the troops that, yeah, we have accomplished a lot. We’ve achieved a lot. And to your point of inspiration, it inspires them to keep on going and laying more telephone poles. And I thought that was such a great story… Just came to mind when you were talking.

Stephen: That’s a beautiful story. I love it. Yeah, because it’s both a vision of where we’re going, but what gives us the courage is to continue to see how far we’ve come.

Denver: Yep. And we don’t do that in the nonprofit sector nearly enough. We’re looking at the unmet need all the time, and it’s like, no, no. What’s there? We’ll get to it, but just take a….stop for a moment…

Stephen: Stop…

Denver: …and appreciate. Have some gratitude and appreciation and celebrate that we have done an awful, awful lot.

Stephen: Yeah. Look how far we’ve come. And I think maybe we don’t do it enough because the needs are so many and so great in front of us. That can almost be overwhelming. But what gives us the strength and the courage to continue in that vision is to look behind and say, Look at this, what we’ve done.

 I would say maybe even a similar thing in the journey of becoming a trust and inspire leader is that rather than beating ourselves up and saying, Look, I’m struggling with trusting, with letting go, and inspiring. How do I inspire? I’m not charismatic. People might think this.

My guess is most of us also are on a journey, and we probably made a lot of progress. There’s maybe some that are still kind of back in the authoritarian command and control approach, but probably a lot have really moved into the more enlightened version. It’s made a lot of progress.

And maybe that will give us the strength and the courage to say,  “I am not my style. I’ve already shifted and changed my style a little bit, and I can continue that shift as I go forward. And I look ahead and I realize, I’m going to need to have a new style to be relevant in this new world. But look how far I’ve come. And look how I’ve really added all these dimensions to it.”

So I’m ready to change the vine, go from this vine to this next vine, because this is what’s going to be relevant going forward. But I think it’s in us, I think our intent, most people’s intent, is good. We want to bring out the greatness inside of people, and we just have to match our style with our intent so that we can really have that greatest impact.

And I think that we can draw strength by where we’ve come from, and then say that we can continue this shift. We are not our style. We are not our program; we are programmers, so we can re-script to the kind of style that we think will work. And I am suggesting trust and inspire. We model, we trust, we inspire.

“So I believe a trust and inspire leader can be strong without being forceful. They can be authoritative without being authoritarian. It can be decisive without being unilateral, or without being exclusionary. They can be detail-oriented without being distrusting. And they can be in charge and have control, without being controlling. So it’s really a third alternative, and it can be very decisive and strong in the moment.”

Denver: I want you to clarify one thing for listeners here, because I think there are going to be some people who are going to look at command and control, and I got to tell you, that sounds strong, it sounds forceful. And on the other hand, trust and inspire can be interpreted as nice or soft. That’s not the case, is it?

Stephen: Nope. Not at all. And I agree with you, and in fact, I wrote a whole chapter as you know on what trust and inspire is not. Trying to take this head- on, that command and control sounds strong; trust and inspire sounds weak.

But let me put it this way. I view, if command and control is excessively hands- on, what I believe the opposite of that is, is not trust and inspire, it’s not the opposite. Trust and inspire is a third alternative. The opposite of command and control is abdicate and abandon. That’s excessively hands off. There’s no leadership there. There’s no vision, there’s no direction. That’s soft. Trust and inspire is a third alternative. It’s hand in hand.

So I believe a trust and inspire leader can be strong without being forceful. They can be authoritative without being authoritarian. It can be decisive without being unilateral, or without being exclusionary. They can be detail-oriented without being distrusting. And they can be in charge and have control, without being controlling.

So it’s really a third alternative, and it can be very decisive and strong in the moment. It’s just that our paradigm of how we view people and how we view leadership is more accurate, more complete, more whole around who people really are and what leadership is really about.

As a parent, if I’m a trust and inspire parent and I love my children and want them to grow and develop, and I see the best in them, if my three-year-old runs into the street, I don’t sit back and say, Well, I trust them to turn around and come back out. No, I’m going to just run right in there and grab them and pull them out, because that’s what the context demands.

But they experience it and interpret it entirely differently when they know I have their best interests at heart and that I truly, deeply care about them and their growth and development, and they know that. And versus someone that is not caring and is really just a dictatorial approach.

So absolutely, this is, I think, the strongest form of leadership requiring great courage, but simultaneously, we’re also requiring strong humility. In fact, it takes courage to be humble.

Denver: It does.

Stephen: And so this is not kind of an either/or, strong versus weak; this is an …AND.  This is a better way to lead in the world.

Denver: In listening to you also with the distinctions you just made with those words, I guess language is very important in becoming a trust and inspire leader. Correct?

Stephen: It is absolutely important, and words matter. And we’re deeply scripted in command and control and we don’t even know it. The rank and file, the span of control. There’s just phrases, words, high potentials, and we name things and…

Denver: We’re going to deploy our resources.

Stephen: Deploy our resources. People are our most important asset. It’s in the language, but we shift the language to what is more expansive and more inclusive. People have greatness inside of them. So my job as a leader is to unleash their potential, not control them. People are whole people– body, heart, mind, spirit.

So my job as a leader is to inspire, not merely motivate and so forth. It’s in our language. We partner, we collaborate. We have partners and collaborators and associates versus employees. I think of Martin Buber and years ago, his book, I and Thou. The whole idea of just the respect that when you start to lose that respect, you end up with “it,” instead of “them.”

People become things and it, a thing. Not a thou, which is the dignity of the human being. And so the whole idea– language does matter, and the language of a trust and inspire leader is expansive, is inclusive, is forward- looking. And it also brings out the best in people.

I love this idea that if we treat people according to their potential, not just their behavior, we’ll help them realize their potential.

Denver: Sure.

Stephen: They tend to live up to it.

Denver: Well, we find that in schools, particularly in urban centers. We set the bar so low because we make this assumption. But when you set a high bar, Lo and behold…

Stephen: Lo and behold.

Denver: …they rise up to it.

Stephen: That’s right. And low expectations inspire no one. And so a command and control leader has very high expectations and accountability to those expectations that you can be demanding without being demeaning or overbearing. Again, this is a third alternative.

Denver: Yeah. I want to ask you a little bit about a trust and inspire workplace, and I want to do that in the context of nonprofit organizations. Because nonprofits have a real challenge, and I’ll tell you what it is, and I know you know what it is. It’s for talent.

And here we are in an incredibly tight job market, and the fact of the matter is nonprofits cannot pay the same amount as private industry. And I’ve even had people on the show who are basically from private industry say, Well, we’re going to LinkedIn, and we’re looking at all the nonprofits because you have a lot of good people, and we can pay them more.

And I’ve asked a lot of leaders what their number one problem was in leading a nonprofit. And right along with fundraising, it was my workplace culture and retention of my staff. Those would be the top three. What can a trust and inspire workplace– because there’s probably even data on this,  do to really engage and inspire and retain and recruit talent?

Stephen: Yes. I think this is one of the reasons why this kind of leadership is so needed today… and because people have these choices and options. And again, for the nonprofit, like you’re saying, it’s just that sometimes they can’t compete on the pay, and so they’re having to compete in other areas and tap into that.

But the more you can build a high-trust culture that inspires, that becomes a talent magnet. Also, not only to attract people, but to retain them. And when people feel inspired, it brings out… they not only perform better, it brings about their wellbeing, and their growth and development.

And if you look at the McKinsey study on why people leave, the data shows the number one reason why people leave is because even more than pay, it was that they’re not growing enough, and their development is not strong enough. And then pay was up there, but what also was up there was– I have uninspiring leaders. I don’t feel inspired.

And so, yes, pay matters, but that’s the body, that’s just treating people as a body. They also have a heart and a mind and a spirit. They’re a whole person. So they also want to connect and want to love and care and belong. That’s the heart. And they have a mind. They want to contribute and grow and develop. And they have a spirit. They want to matter, make a difference in a legacy.

And so especially at philanthropic and not-for-profit entities that are doing good in the world, we can really tap into all these other aspects in profound ways of having purpose and meaning and contribution. But not only does that matter– that the work that we do matters– but the people themselves want to feel that they matter.

That they have a sense of belonging, that they are growing and developing, and that they feel inspired themselves, not only in the work that they’re doing, but in the leaders that they have and in the culture that they have. But here’s a study from The Great Place to Work Institute. It looked at millennials, and I have not seen an updated one on Gen Z, but I’ll bet it’s similar.

But it showed this: that in a high-trust culture, there’s a 22 times greater probability of retaining millennials than there is in a low-trust culture. It wasn’t two times, it was 22 times higher.

Denver: Boggles the mind. Yeah. You don’t…

Stephen: It boggles the mind.

Denver: Yeah.

Stephen: Because they, again, people don’t want to be managed. People want to be led. They want to be trusted, they want to be inspired, not just millennials… every generation does. And the Gen Zs do and this alpha generation, people want to be led, they want to be trusted and inspired. And a high-trust culture that inspires, I believe, is our greatest resource, our greatest tool we have.

It’s really a way of being able to keep the best talent because we will bring out the best in our talent. And they want that; people want that. They feel like they’re contributing their best work. And I used to do seminars with my dad, and he would start every… Stephen R. Covey who wrote The 7 Habits of Highly Effective People, he used to start every seminar with this question.

He would say in front of these big audiences, thousand people from all kinds of organizations, including not-for-profit, and he’d ask this question, “How many of you believe that the vast majority of your workforce has far more creativity, ingenuity, talent, capacity, ideas than their current job requires or even allows them to contribute?” Basically every hand in the room would go up.

Denver: Then every hand… Yeah. Yeah.

Stephen: And the second question was, “And how many of you are under more stress and pressure than ever before to do more with less?”  And almost every hand in the room would go up, and it’s kind of like: What’s wrong with this picture? We all have to do more, and yet we’re not tapping into anywhere near what people have to give.

As Mahatma Gandhi said: The difference between what we are doing and what we are capable of doing would solve most of the world’s problems. We need to tap into that difference, that gap. We need to unleash the greatness inside of people. When we do, they’ll stay. When we bring out the best in people, they love being part of that, and I think the not-for-profit sector, and the charitable sector and the giving sector can be the leaders in this.

Denver: Ah, that’s great  to hear that. I was reading your book. That’s exactly the thought that I had. There’s so many things in the DNA of a nonprofit that are aligned with the trust and inspire culture, and maybe on even a more pragmatic level, they need to do this because if you cannot compete on pay, there have to be other points on the value chain that are going to appeal to young people.

And this is a place that you can stand out, head and shoulders above your private sector competitors, if you will, to really become that kind of a magnet. Because as you say, even other studies show, this is more important than pay to millennials and Gen Zers in terms of their engagement, their autonomy, being inspired, seeing what they do… how it impacts the mission. These are the things that really make a difference.

Stephen: Absolutely. And the not-for-profit sector, the giving sector has purpose and meaning and contribution. But sometimes we’re not tapping into that, even though people know what we do matters. When people themselves don’t feel that they are being optimized and using their greatest strengths, what happens is it diminishes and dilutes that extraordinary value of what we’re doing.

People still like it and believe in it, but we don’t get anywhere near the impact that we could have on the person because of the work that we’re doing when they themselves don’t feel trusted and inspired and unleashed.

Denver: That’s right. That’s right.

Stephen: And when they do, we can tap into that in unique ways.

But where we can lead is that: Who has more purpose and meaning and contribution than the not-for-profit sector, in the giving sector? It matters to the world, to the society. So when we co-purpose, we overlap the organization’s purpose, which is extraordinary, with the individual’s purpose in a way that lights that fire within, and we are tapping into that greatness.

We are developing the person. They feel it, they feel trusted, they feel inspired. We can go to a whole new level, and we can lead in this sector. We can be a model for the business community of attracting and retaining great people through leadership. I believe this is a leadership opportunity where the not-for-profit sector can lead and be a model that could become a mentor to all the world.

Denver: Yeah. And those are really good words there too, because I think sometimes, nonprofits can get lazy with their mission and saying we have this mission…. but purpose on the individual level. And you know what, I found?  You can get purpose out of producing a great HR manual.

It’s sort of like, sometimes, I’ve been to restaurants and the chef will come out, ehh, he’s making a dish. It’s an art, it’s a craft, what he’s just done. And I mean, look at the guy, and I say, Look at the purpose he has in preparing this dish and the pride that he has. So it is such a multifaceted aspect of what purpose really is, is that it’s at so many different levels.

Stephen: Absolutely. At every level. And I believe that we can create and embed purpose, meaning, and contribution into almost any role, into almost any organization. It’s easier actually to do it in a giving organization and not-for-profit one because the overall purpose is so grand. But we need to translate that into the personal purpose and the co-purpose, overlapped purpose.

Light that fire within the person because we’re lighting a lot of other fires out there. But I find sometimes there’s too much of a disconnect, and we’re not tapping enough into… people don’t feel enough trust and caring for the person. That’s why you win in the workplace in order to win in the marketplace.

But we can lead the way. Not-for-profit sector can lead the way and be a model, and models become mentors, and then we can elevate society, not only through the giving that we do, but through the way that we lead and the unleashing of talent. What if we were the model of that?

“…we are not our style. We are not programs, we’re programmers. We could write the program; we can re-script. Maybe we’ve been scripted in command and control, it’s what we know, but this is not who we are.”

Denver: Getting back to the Red Cross, I was speaking to a young woman down there a while back, and she was in accounting. And she says one of the things she loved about working with Gail and the Red Cross is that although she was in accounting, people would ask her opinion about mission-critical endeavors that they were on.

And she says the fact that they would ask me what I thought about some disaster, made me feel so connected to this organization, that my voice counts. They wanted to hear from me and she says, You have no idea for somebody who’s pushing a bunch of numbers and papers all day how special that makes me feel, that I belong here, and people want to know what I have to say.

I’m going to end with one last question and it may be a little tough, and that is, look, if 9 out of 10 of our companies and organizations are command and control somewhere along the continuum, and only 8% are trust and inspire, do you think we can become a trust and inspire society now? Or do we really need to wait until the next generation takes the helm at these organizations?

Stephen: Yes. I think we can do it now. I think it’s possible now. I acknowledge that… I think the next generation will demand this. I think they’ll go there, but I don’t think we have to wait. The reason I say that is because we got to be relevant, and command and control is becoming increasingly irrelevant by the day. It’s not working.

I don’t know that it ever worked that well to begin with, but it’s certainly not working very well now. And so the increasing irrelevance of command and control will help move people. But also, I think what’s going to happen is we’re going to start to see models of people that are doing it, companies that are doing it, leaders that are doing it.

I look at what Satya Nadella has done at Microsoft.

Denver: Unbelievable.

Stephen: Unleashing the greatness of the organization by first unleashing the greatness of the people through modeling, trusting and inspiring. It’s remarkable. And we need models who can become mentors, and it’s in us.

And then finally, the last reason I think why is because we are not our style. We are not programs, we’re programmers. We could write the program; we can re-script. Maybe we’ve been scripted in command and control, it’s what we know, but this is not who we are. We are a programmer where we can write a new program, and when we recognize this is not going to work very well.

And my intent really is to unleash greatness, to serve these great purposes and missions, and that maybe there’s a better way I can match my style with my intent. I can write a new style. I can embody that and become that. We don’t need to wait. We can do it now.

Denver: You’re changing verbs into nouns. You know what I mean? I like to run, I run. That’s wholly different than: I’m a runner. When you say “I’m a runner,” there’s an identity with,  “I’m a runner.” And that is really interesting.

Hey, the title of the book is Trust and Inspire. The author is Stephen M. R. Covey. Pick up a copy today.

And Stephen, is there anything else listeners can do to better understand this new leadership paradigm that you’ve presented?

Stephen: Two last thoughts. The first is the idea of inspiring. Think of it this way. Everyone can inspire. It’s a learnable skill. It’s not just for the charismatic. We sometimes conflate inspiration and charisma as if you got to be charismatic to inspire. No. I know a lot of people who are charismatic, but who are not inspiring.

And I know other people who no one would describe as charismatic, but who are extraordinarily inspiring. Because of who they are, how they lead, how they connect with people. So caring and belonging, and then connecting people with their purpose. So everyone can inspire. It’s learnable, it’s a learnable skill, and it’s a stewardship we have.

And the last point would be: someone needs to go first. Leaders go first. Don’t wait. Just go first. Be a model, not a critic. Be a light, not a judge. Lead out, go first. And you can help bring about the change that we’re all seeking. As Gandhi said: Let us become the change that we seek in this world. Go first, leaders go first.

Denver: Fantastic. Thanks, Stephen, for being here today. It was such a delight to have you on the show.

Stephen: Thanks so much, Denver. I loved being with you today. Thank you.

Denver Frederick, Host of The Business of Giving serves as a Trusted Advisor and Executive Coach to Nonprofit Leaders. His Book, The Business of Giving: New Best Practices for Nonprofit and Philanthropic Leaders in an Uncertain World, is available now on Amazon and Barnes & Noble.

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