The greatest CEOs are necessarily driven, decisive, and confident. But McKinsey senior partner Ramesh Srinivasan, senior partner emeritus Hans-Werner Kaas, and coauthors of their new book, The Journey of Leadership: How CEOs Can Learn to Lead from the Inside Out, say CEOs must weave in a layer of soft skills like self-awareness, humility, and compassion to inspire their workforce. On this episode of The McKinsey Podcast, Srinivasan and Kaas speak with editorial director Roberta Fusaro about taking on the challenge of reinvention for the greater good of the company.
This transcript has been edited for clarity and length.
The McKinsey Podcast is cohosted by Roberta Fusaro and Lucia Rahilly.
Leader, know thyself
Roberta Fusaro: You and your coauthors just released a new book, The Journey of Leadership: How CEOs Can Learn to Lead from the Inside Out. Put simply, what is inside-out leadership?
Ramesh Srinivasan: The world is changing rapidly. The geopolitics have become quite complex, technology is having a huge impact, and climate change is here to stay. In this context, we felt the world needed a new paradigm of leadership. We call it human-centric leadership. Our belief is that leaders need to reflect on their purpose, who they are, how they show up in the world, and how they can inspire their teams and the institutions they’re leading.
Hans-Werner Kaas: Human-centric leadership provides the permanent guidepost for leaders of all backgrounds and levels. That guidepost, plus the actions leaders take to get to it, is central for colleagues and external stakeholders to look up to.
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The inside-out notion means that any change starts with ourselves. We need to have the ability to be self-aware—of our words, our behaviors, and actions, and then reflect upon where our strengths and weaknesses are. You can call it self-development, which requires adopting human behaviors such as empathy, care, compassion, humility, and vulnerability—and at times, determination, confidence, and resilience. Balancing these different behavioral sets really depends on the situation you’re in as a leader.
Why this, why now?
Roberta Fusaro: Why this, why now? Ramesh, you answered it a little bit. The challenges for today’s leaders in 2024 are very different. But can you talk a little bit about what exactly has changed?
Ramesh Srinivasan: The geopolitics in the world have become much more complicated. Technology, AI, and gen AI [generative AI] are also having a huge impact. So amid all these changes, leaders need to have a sense of who they are, what their purpose is, and what motivates them. How do they show up in the world? What do they talk about? How do they understand their team members even more deeply as human beings, so they can inspire them in the spirit of their team purpose? And use all of that to inspire organizations and institutions that they’re part of.
Leaders need to have a sense of who they are, what their purpose is, and what motivates them.
Roberta Fusaro: Hans-Werner, you’d mentioned that this inside-out approach is very personal. The book prompts leaders to take a closer look at their vulnerabilities, perhaps their insecurities—and that can be scary. I’m curious, how can the book help ease this process for CEOs and other leaders?
Hans-Werner Kaas: There are stories of 24 former and active CEOs in the book. They’re very personal stories, in which they reveal their insecurities, their struggles, how they’ve addressed them, and how they tried to overcome them. None of those 24 CEOs said they have achieved or reached a destination point, but all of them said they’re on a good trajectory to become more effective and more human-centric leaders.
The book also has a step-by-step “reinvention guide” that really helps you to transform yourself.
A series of balancing acts
Roberta Fusaro: The book is helpfully divided into two parts: the psychological and emotional aspects of leading yourself, and then the human side of leading others. Among the chapters that talk about humility, confidence, selflessness, vulnerability, resilience, and versatility, Ramesh, is there any one of those traits or a focus area that is more important or harder to get right than the other?
Ramesh Srinivasan: We find that all of them are quite important. The one trait I want to start with is the balance between courage and curiosity. There’s the example of Stéphane Bancel, who shares in the book how, at the peak of the pandemic, he had to make a bold decision to develop and manufacture a vaccine, something that Moderna had never done before.
He had the courage to set a bold vision and inspire his team. At the same time, he brought an incredible level of curiosity because he knew there were many things they did not have capabilities for, like manufacturing a vaccine—and also a billion doses of them.
The other trait is a balance between confidence and humility. Lynn Elsenhans is another inspiring leader, who balances confidence and humility. When she was CEO, she sometimes had to be in rooms where she was the only woman, and she carried with her a sense confidence that she belonged there. As a leader, she brings amazing confidence; I’ve seen it in all my interactions with her. And yet she is extremely grounded and humble in the way she operates, and in the way she inspires her team.
Hans-Werner Kaas: Another example that comes to mind is that of Mark Fields, the former CEO of Ford Motor Company. When he became CEO of Mazda Motor Corporation, which was part of the Ford group in the year 2000, he decided it would be much better for the first six months or so to show humility. He then went on a mission to listen and be humble. He did not pretend to have all the answers, even though he did have clear views and hypotheses on the solutions for the company. He engaged in that balance of showing confidence and humility, as well as vulnerability, because he admitted that not all the answers are obvious to him, and that it would take a co-creative team effort to develop them.
One additional example is about deep learning. Admiral Eric Olson, the former head of the US Special Operations Command and a Navy SEAL, talks about the notion of fearless learning in the book. He says it’s such an important ability to not fear that your assumptions can be wrong. On the contrary, be willing to abandon your assumptions if needed. Olson says that no single plan survives the first enemy contact. In that context, he talks about how important it is that, when the terrain differs from the map, you follow the terrain. It means make a new plan, change your assumptions, so that you have a higher probability of succeeding in your mission.
The journey inward
Roberta Fusaro: Hans-Werner, you mentioned the notion of self-awareness is critical to succeed in this inside-out journey. But CEOs, leaders, and military leaders have such a packed agenda. How do they find the time to break from the day-to-day patterns and practice some self-awareness and reflection?
Hans-Werner Kaas: It’s very hard. We all experience it in our own roles and professions. I would point to what we describe in the book as micro practices.
As it relates to making time to be self-aware, we have to first understand our situation. Why is it so hard for us to set aside time for it? Then, consider practical things you can do. You might decide to not touch any digital device in the first hour you’re awake in the morning. Instead, you use the time to mentally go through your day and not interact with anybody. You are just alone with your thoughts, alone with your priorities. Reflect on what you have done in the recent past, the past day, the recent week, and what impact your words and behaviors had on others.
This is very important because self-awareness means you understand the implications of your words and thoughts on others. It’s fundamental in leadership. The second step is to self-reflect, which is the exercise of developing behavior practices to improve. So that’s the sequence.
Ramesh Srinivasan: I’d add one more thought. In the book, a former media company CEO talks about finding truth tellers in the organization. As you become senior, people often don’t come and tell you the truth or give you specific suggestions for how you can evolve as a leader. So putting in place a culture where people feel safe, and taking the time to meet junior people and those at the front line who meet your customers, is critical to have a pulse on what is happening in the company. And that can also be a great source for insight and subsequent self-reflection.
Humans are still in the driver seat
Roberta Fusaro: Ramesh, you mentioned gen AI as one of the bigger changes that leaders are facing nowadays, and pointed to the importance of human-centered leadership amid all the changes that are happening. Can both of you say a little bit more about this notion of leadership alongside gen AI and other technologies?
Ramesh Srinivasan: I see technology having a massive impact on the world. Yet, in all our research and our work, we feel the value of humans in the loop is not going to go away. The challenge for leaders is they need to understand how the technology is impacting themselves, their teams, and their businesses.
On how the role of the leader and the human being is evolving, Hans-Werner talks about the value of empathy, deep listening, and creativity. We don’t see those dimensions going away. So the question for leaders is, how do they bring some of those skills to bear so that the institutions they’re leading can use technology in service of society, in service of their customers, and in service of employees?
The question for leaders is, how do they bring some of those skills to bear so that the institutions they’re leading can use technology in service of society, in service of their customers, and in service of employees?
Hans-Werner Kaas: As Ramesh said, in our view, there are two things gen AI will not accomplish. It cannot develop the emotional human touch. Second, gen AI can be a helpful tool to all different leaders, but leaders need to be very cognizant of where those most profound applications are, and not hype or exaggerate it, as if it’s the solution to many leadership problems. It is not.
A new era of business means a new era of leadership
Roberta Fusaro: Hans-Werner, another point in the book is this notion of the imperial CEO. Folks like Jack Welch and Lee Iacocca, the larger-than-life leaders, are essentially no more. When did that change and why did it change?
Hans-Werner Kaas: As Ramesh outlined at the beginning of our conversation, the forces at work, whether it’s in geopolitics, societal movements, environmental sustainability, or technology, have dramatically changed compared with where we were in the ’80s and ’90s.
The age of the imperial CEO has long passed, and it all comes back to what we said about inside-out leadership and displaying human-centric leadership. Only then will you invite stakeholders and colleagues to provide ideas in a proactive manner and be engaged, versus being in a more commanding or controlling environment, as if they are managerial subjects.
The age of the imperial CEO has long passed, and it all comes back to what we said about inside-out leadership and displaying human-centric leadership. Only then will you invite stakeholders and colleagues to provide ideas in a proactive manner and be engaged, versus being in a more commanding or controlling environment, as if they are managerial subjects.
Roberta Fusaro: If you’re looking out a year, two years ahead, what impact do you hope this book will have in the business community?
Ramesh Srinivasan: Our hope is that both business leaders and social-impact leaders benefit from the ideas in the book. We hope that leaders of all genders and of all kinds will also benefit from what we have in the book. That’s our first hope.
We also want to add to the debate on leadership. We’re hoping our knowledge and research will be additional contributions. We hope to use the book as a catalyst to engage with leaders and institutions on this topic, to help them at an individual level, to help their teams, and to help institutions in the world.
Hans-Werner Kaas: Let me pick up on the third point of what Ramesh said. The aspiration is that everybody who reads the book, or even only a portion of the book, becomes more human-centric. Not only in their personal life but also in their professional life and in different sectors.
Then there is the process itself in “The Journey Never Ends,” the concluding chapter. Every reader should indeed define their own self-reflection and reinvention process and methodology. And that can happen in confidence within your family circle or with your spouse. It could be with one or two trusted individuals on your executive team, or trusted people in your organization. It can also happen with external coaches. Find your own what we call self-reflection and self-reinvention forum.
