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Leaders of Change

Dr. Argüden is a noted subject of the recent book authored by Melih Arat about contemporary leadership.

Melih Arat – Leaders of Change (published by Mavi Kitaplar, 2001)

A Shining Visionary: Dr. Argüden

With his extensive commitment to improve the management quality in the public and private sectors as well as non-governmental organizations, Dr. Argüden is a leader who has the ability to rouse others to think and act in fresh ways and who has enriched and expanded contemporary life in Turkey. As the Chairman of KalDer (Turkish Quality Association), Argüden initiated the National Quality Movement and is a founding member of a number of other important foundations, among them TESEV (Turkish Economic and Social Studies Foundation) and TEGV (The Turkish Education Volunteers Foundation). Argüden’s efforts reach further than local and domestic realms; under the auspices of the Foreign Economic Relations Board, he has been a valuable contributor to the strengthening of the Turkish-American and the Turkish-Canadian business relations.

When I spoke with Argüden’s fellow classmates from Bosphorus University, nobody was surprised by the successful initiatives he has led. I got the feeling that everybody expected great things from him. In his graduation yearbook, one of his classmates wrote “Why are you are always ‘better than the best’?” regarding Argüden, and perhaps it is this statement which sheds the most light about how he is viewed by those close to him. Several friends of mine who had the opportunity to work with Dr. Argüden remark that he is “extremely unique, a person of great eminence.” After I heard Dr. Argüden’s opening speech entitled “How to overcome the Trust-gap in Turkey” at the 1997 Quality Congress, I came away with the impression that he was one of the few, outstanding people with truly original ideas and powerful insight in his observations.

Dr. Argüden is the Chairman of ARGE Consulting, and his minimalist Istanbul office overlooks the bustling financial district of Maslak. Looking at the magnificent view of Istanbul’s skyline from his window, being in Dr. Argüden’s office feels like being in downtown Manhattan. But it’s not only the spectacular view of skyscrapers which reminds one of America, it’s also the interior of his office with its comfortable and creative design. The office layout is extremely functional and it is obvious that much thought has gone into planning both the furniture and the layout. Precisely on time, the wooden door opens and Dr. Argüden steps in with his unmistakable warm and efficient manner.

Towards the end of our interview, I asked Dr. Argüden to speak about himself. “…I am a very curious person. I like to learn from everybody. Throughout my life, I’ve always been keen to discover who the authority is on any given subject is. I always have a clear line of communication open. I avoid relying on the same people for information, but prefer to approach a broad variety of people for information on a variety of subjects. Sometimes it involves attending a basketball match together, and other times it means volunteering for a good cause together. And, if you surround yourself with the best people and support them and their endeavors, you can reach great results in a much shorter time with far fewer resources. The most important characteristics I seek in those around me are talent and values. By values, I mean self-motivation, a passion for learning, high ethical standards, and the ability to share honestly.

When asked “What is the most important teaching in your life?”, Dr. Argüden replied “To learn how to learn.”

My subsequent writing about Dr. Argüden resulted in a most honest and intimate portrayal of this man.

A boss will say, “Go!” but a leader will say “Let’s go!”
Anonymous

Leaders who Learn and Share Together
Dr. Argüden
ARGE Consulting

 

Leadership: Learning and Sharing

I am fortunate to have had the opportunity to instigate widespread change over the years. One of the fundamental reasons underlying this motivation to change is the effectiveness of perception, and here, the word “perception” is of critical importance. People tend to limit themselves and the use of their innate resources based upon their self-defined boundaries and perceptions. This is a concept, which is very difficult to explain but also a most useful fact of human nature when we apply it to various situations. For example, it’s quite common in a classroom situation for a student to say, “I’m going to get a better grade than my colleagues,” thereby forming and limiting his own expectations on a defensive basis which is undoubtedly less than perfection. This sort of competitive behavior and effort is actually very normal.

My own perception differs from this. I have always strived for “zero tolerance” towards less than perfect performance. When I am faced with a less than perfect performance, the first question I asked was “What went wrong and how can correct it?” and I made it a point to share these observations and answers with my classmates. The reason behind this is my belief that the best way to learn is to teach. Additionally, sharing knowledge is a very beneficial activity when applied to accumulating knowledge You will always learn more as you share more. The more effort you spend in giving knowledge, the more capacity you will have for receiving knowledge. If you enlighten ten people about a subject, and each one of those persons asks one question regarding that subject, you’ve just enriched your own knowledge by ten new perspectives. This approach offers encouragement to the individual who is sharing, due to the positive reinforcement and feedback involved with sharing one’s knowledge with others. This is among the primary reasons I was able to reduce stress whilst helping my fellow classmates during my school years, and was a contributing factor in my academic achievement, which happened to be ‘the best’ in all the schools I have attended.

There are two things in life, which increase when they are shared, and these are love and knowledge. Coincidently, these are also the two vehicles by which individuals and leaders further themselves. This portrayal of leadership suggests that a good leader greatly extends the learning curve of his followers. In turn, feedback from the followers further enhances learning both of the leader as well as his fellows.

For example, when the National Quality Movement was initiated under my Chairmanship of the Turkish Quality Association, of course I contributed to defining the objectives. But in time, it took on a life of its own as there were so many people contributing so much to the movement that it surpassed the goals that were initially put forward and it became a much broader project.

To achieve these results required a very intensive effort in sharing resources. When we first conceived the idea for the National Quality Movement, our first task was to identify who we could approach for financial and human resources. We explained our mission to all those whom we felt could support us, and we received very valuable feedback from tem. Later, we asked, “Who are the people best qualified to further this mission?” The answer was simple and obvious: “Those who have applied the Total Quality Management in their own organizations will be most qualified for the task.” As a result, we agreed that the Board of Directors of KalDer would be comprised of persons who led such an initiative in their own organizations.

Then, we formed an Executive Board. The Executive Board was selected from those who have proved their technical competence in organization and who have successfully adopted this management philosophy..

We then followed up by creating the necessary working environment and conditions. Instead of falling prey to nepotism and placing friends, relatives, and colleagues in these positions of responsibility, we advocated using those persons best qualified for the position based upon their knowledge and experience. Together with this approach and the ability to create and execute plans by sharing resources with others, objectives are far more readily attained.

A leader must first create a culture of learning and sharing among his fellows. A leader who is not up to par with his fellows will not be successful as a leader, as he will not be able to motivate others. In order to bring a project to fruition, a leader must be able to incorporate the feedback he receives, and must continually seek this feedback. This is why the environment of continual learning and sharing of knowledge is so vital.

Monopolizing information for the sake of stepping ahead of others is no longer what gets one ahead in this day and age. We live in an era in which it is no longer possible or practical to keep information to ourselves, and therefore it’s important to actively share what we know. Vast knowledge in the hands of one person is quite useless, as knowledge is best utilized when it has been gathered and applied collectively

 

Defining a Leader

A leader is someone who can inspire others into action to achieve an objective. He is able to channel others’ resources towards a desired outcome through motivation, direction, and continuity. Thus, by definition, each and every one of us is a leader. The old adage “Leaders are born, not made” does not necessarily always hold true because each of us is able to perform a leadership function at some time in some manner, perhaps with a friend or a child or in our social circles by influencing others.

A natural leader can be spotted by the number of persons he has motivated, the period of time over which the motivation lasts, the subsequent long term actions which have been undertaken by his followers, and the impact of these actions.

According to recent research, an average individual has a sphere of influence over approximately 250 other individuals during his lifespan. When approached in this fashion, we can see that all of us have some leadership potential, and the differentiating factor separating those who we identify as leaders is the development of these skills.

My belief is that one of the fundamental requirements for excellent leadership is the ability to bring excitement to people by means of portraying a common vision, as well as the ability to carry out the strategy to put that vision into action. I also believe that strategic vision is the most important quality in a leader, because there are many different types of leadership styles and it is the application of strategy that sets them apart from one another. Some leaders employ methods of fear in order to create discipline. But when the fear factor is removed, we find that this style of leadership loses influence over its fellows. Instead, leadership styles which address individuals’ hearts and minds are far more effective. Good leadership is not defined by close supervision of individuals, but is attained instead by creating an environment in which individuals believe in and value highly what they are doing.

I believe that in Turkey, with regards to leadership we are under performing relative to our full abilities. We tend to confuse position with identity, whereas position and identity are actually very distinct from one another. It is critical to be able to separate them. Otherwise, people begin to identify themselves as a function of their position and this is a practice that tends to lock people’s natural enthusiasm and inhibits personal growth and progress. Nobody can reinvent himself or herself if they are being held in one place; therefore, it is important not to occupy the same function for long periods of time but instead, to seek and welcome change. A leader needs enough time to learn and absorb the changes encountered in a particular role. Once he has acquired sufficient knowledge to feel comfortable in that role, remaining in that role risks stagnancy. A good leader has to develop others to replace him, before he gets comfortable. Comfort is the anti-thesis of change and development.

When I am considered for a particular position, one of the first things I ask myself is “What is the purpose of this position and what kind of results can be achieved?” I put myself through a critical thinking process, and I would not accept a position for the sake of that position without going through this critical thinking process. After all, if you do not know what you wish to achieve, you cannot create value. The goal has to be: To “do” something, not to “be” something!

“A true leader is interested in organizational change and value creation, not the title.”

It is important for a leader to have sufficient powers in order to effectively instigate change, as without sufficient power, change will take much longer to incorporate.

Preparation for a leadership position involves testing a person’s knowledge and integrity, both directly and indirectly. It almost goes without saying that a successful leader must have adequate motivation and knowledge in his field.

This knowledge is directly tied to an individual’s experience in a particular field. Let us take an example from politics. A Prime Minister should be expected to have some experience either as a minister, governor or perhaps as an undersecretary. He would be well versed with the demands of such positions. For example, in the United States, it is very unlikely that an individual would be elected President if he had not already served as senator or governor. Well known U.S. businessman Perot was an excellent manager, but without public service experience, he was unsuccessful with running for public office. Had Atatürk not been a veteran of the Çanakkale War and other battles, he wouldn’t have been as successful as he was a military commander. In summary, people without sufficient knowledge and experience in their field should not seek leadership roles in those fields.

 

Effective Leadership: Changing the Rules of the Game

Those amongst us who can best instigate and implement change are those who have a vision which extends past the organization they are leading and actually influence and encompass their entire environment by their ability and willingness to change the rules of the game.

When I undertook responsibility for the Privatization Program, my first mission was to weigh the effectiveness of the resources as well as public support for the Program. I discovered that we did not have sufficient capacity to deal with potential investors and learn from international experience. Therefore, we first recruited additional personnel with international experience and started a rigorous education program for all persons involved in the Program. My intention was to motivate all persons involved with the Program, and I personally took an active role in all of the teaching activities.

When we realized that Turkey required greater experience in the mergers and acquisitions we decided to work with international investment banking institutions. However, to develop a national capacity in this field, we made it a requirement that qualified foreign consultants would work together with Turkish partners when preparing companies for privatization. Concurrently to this, we convinced the Undersecretary of Treasury for a wider, more effective role with regards to supporting investment banking. In this manner, we played an important role in strengthening Turkey’s investment banking infrastructure. Interestingly, according to a study undertaken at that time, 80% of the income of the investment banking industry was related to the privatization deals, representing either the buyer or seller. Today, that figure is below 10% and Turkey has become a regional player, providing investment banking services not only in Turkey, but also in other countries such as Romania and Bulgaria.

We also realized, that the public was not sufficiently supportive of the Program and we have established a serious public relations campaign. In order to better educate the public about the benefits of privatization, we began an intensive education program in conjunction with arranging to offer initial shares of the government companies directly to the public. It was during this period in which initial public offerings became popular with the public. Further into the program, despite my objections, several unfortunate changes were made to the general procedure, including overvaluing of assets being offered to the individual investor. As a result, I decided to resign from this post. Unfortunately, my warnings proved to be true and it shook public confidence in the privatization program. It was this mistrust that required eight years for the Program to revitalize itself.

It was also during this period when talented personnel of the Privatization Administration left the government for local and international investment banking jobs. Also, the young Turks that gained experience by working with international banks were promoted to important roles both internationally and domestically. Together with the legal reforms which were passed, this generation helped to set way for the birth and growth of the investment banking sector as well as the flourishing of the Turkish stock market..

 

Vision, Mission and Value

“Good will benefit all.”

If a person wishes to be an asset to his community, and if he wishes to truly make a difference he need apply his knowledge towards solinge public issues. This requires not only developing, but also sharing a vision with the community…

An excellent leader doesn’t paint his picture on a canvas, but instead, provides the ideas for pictures that may be painted. Team-mates will paint a picture based upon the “ideas” and both the leader and the other team members will have had inputs into the final picture. It is only during the process of painting when the leader, based upon his knowledge and resources, may warn, “Don’t use quite so much red.” When Atatürk said, “Our goal is to reach the Mediterranean. March!” he was not the commander of each battle which followed but was able to guide his military leaders in leading their own battles. However, he was also very well versed in the risks of the war and he knew the extent to which his resources could reach. Also, when necessary, he was able to step into action on the battlefield, as his injury in Sakarya demonstrates. To summarize, a leader has the ability to identify a situation based upon how critical it is, and is qualified to decide how to best allocate resources accordingly.

I am not implying that it is enough for a leader to simply toss out an idea and leave it to the others to decipher. It is also not sufficient to portray a specific strategy on a platform, despite its excellence, and then say “Go implement it” to teammates.

Leadership is painting a picture together; it is also making everyone feel part of the painting process. This is very effective for two reasons:

• First, the process of learning is one of the highest motivators of people. When you are teaching, if you let others know that you are also at the same time learning;you in turn motivate them.

•Secondly, if you are familiar with your direction as a leader, every single time you receive feedback, you will contribute towards deepening your overall knowledge, which in turn means that you can take your ideas even further.

It is important to develop a clear vision. At the Bosphorus University, I was elected as the President of the Sports Club. The Bosphorus University has a tradition of organizing a mini inter-university Olympics.. When I became the President we wanted to expand this event into an International Sports Day. The first International Sports Day was organized under my presidency, and in 1999, Bosphorus University celebrated the 20th anniversary. The original International Sports Day attracted contestants from eight different universities. Organizing this event required a very devoted effort. Later, I won the Rector’s Prize for student leadership based on the successful execution of this event. It is import to bear in mind that this was not accomplished by an individual single handedly – I only created a vision and motivated those around me to bring it to life.

It is vital to develop a vision together, but it is perhaps even more important to gain the trust of those who are implementing the vision. For years I had been a member of the Board of the Sports Club, so it was a natural role for me to be the President, as I knew the territory well. I had a plan ready to go and knew what needed to be done and what could be achieved with the resources we had. I also had the underlying support of all of my friends based upon accomplishments up until then. In short, I had their trust. So when I suggested “Let’s do something special for this Sports Holiday – let’s go international,” I was able to proceed with the belief that together with the team, we could pull it off as a success.

The notion of vision and strategy are very intertwined. I can say the following at the risk of oversimplification:

 

“Strategy is nothing more than the road map necessary to reach the vision.”

It is not possible to implement an effective strategy without absolutely understanding one’s vision and mission. Atatürk was one of those leaders who excelled in placing attainable objectives. When he proclaimed, “Our goal is to reach the Mediterranean, March! “, he communicated very succinctly what the mission was and how to proceed. He then meant, “We are not proceeding past the Mediterranean. We will stop there.” In this manner, he established a measurable objective. Using his decades of experience as a military officer, Atatürk was able to identify what was required and how far the resources available would reach when setting his goal. “With what I have to work with, this is as far as I will go and this is a sustainable and defendable position”, and he based his plans upon this observation.

Identifying the vision for the organization has been the first step of my work at the organizations and institutions which with I have worked with. I believe that clarifying the goal is basis of focusing all the organizational energy. My role is to ask the right questions and provide the right feedback in order to communicate the vision to all those involved. If a common understanding on the vision is not established, people tend to lose focus and try to implement a different interpretations of vision. Establishing a common understanding of a vision is a powerful enabler for implementation. When we defined the mission of the Bosphorus University Alumni Association, we did not focus on the projects, such as building a social center, but on the meaning: ‘a gathering place for the alumni to increase their commitment and responsibility towards the University’. This is a point worth emphasizing.

We used each project to help explain and realize the vision and continuously strived to further emphasize and explain the mission to the community.

“Every project undertaken should be a vessel with which to further explain the mission.”

 

Culture – Trust — Professionalism

I have served as the President of the Alumni Association of Bosphorus University; however, I would not be able to function as the President of Istanbul Technical University’s Alumni Association. Even possessing the same abilities and talents, it would not be possible to transfer these abilities into a culture which one has not been enveloped in. One can be a great manager, but management skills by themselves are not enough for good leadership.

I have served as the President of the Alumni Association of Bosphorus University; however, I would not be able to function as the President of Istanbul Technical University’s Alumni Association. Even possessing the same abilities and talents, it would not be possible to transfer these abilities into a culture which one has not been enveloped in. One can be a great manager, but management skills by themselves are not enough for good leadership.

Volunteer organizations cannot be solely run by volunteers. Having an effective professional team leverages the volunteers’ resources. That is why hiring and developing an effective management team was one of our key priorities.

For each activity we undertook, we never failed to explain the linkages to our mission and were eventually able to raise sufficient funds for the development of a prestigious alumni center. One of the key elements we sought was to gain the trust of the alumni during this process in order to ensure the success of further fund raising activities for the university. Therefore, during the construction phase, we were careful to keep meticulous records and hired both a control engineer and an outside audit firm. Upon completion of the project, we had a celebration inviting 2500 persons, and we provided both internal and external audits of the fund raising activities and the costs incurred. But furthermore, we also conducted an independent audit of the engineering. Yes, we incurred costs for all of these audits, but the underlying reason behind them was to instill trust. The results were so successful that later the alumni support increased several fold. Following this, the university was able to construct a dormitory with Alumni contributions.

One of the most important motivational components of leadership is to continually demonstrate how your deeds are serving the vision. Every action, every project should serve the vision and an active pursuit of accountability should ensure that all resources are utilized for this purpose. Winning the trust of the community and teammates requires consistent behavior.

 

The Erdemir Paradigm – A Study of Change

In 1997-1999, I served as the Chairman of Board of Erdemir, the largest Turkish steel company. Once again, the first action that was taken was to define the vision and mission of Erdemir explicitly. “What kind of a mission would best motivate us?” was one of the questions we asked. The company was engineering focused and investments were often gold-plated. Furthermore, as the only integrated flat steel company in Turkey, the customer focus was lacking. The primary focus of the company was to make more and more investments in Eregli.

Erdemir needed to cast aside this approach in order to be a regional player. Instead of being internally focused, it needed to adopt a broader vision. Instead of viewing the customer as a nuisance, it needed to apply total quality management techniques and put the customer at the focus of all the activities. Then, we reviewed the resources we had and identified the skills gaps that needed to be developed It became apparent that financial management needed significant improvements. We were unable to locate a qualified person to serve this function, so we brought a CFO in from the outside. Soon, we began to research other international companies and whether or not it was financially feasible to purchase them.

Until then, management had never toyed with such ideas as mergers and acquisitions. As Erdemir had a qualified engineering staff, we felt that we could improve the performance of other plants in the region. However, this required a significant cultural transformation at Erdemir. Did I single-handedly do this? No, I was only the catalyst. Erdemir had huge resources and was not making maximum use of those resources. My duty was to form an infrastructure by which those resources could be best utilized. It was also in my duty to bring in a professional to the post of the general manager. This way we were able to both initiate a quality initiative and a growth by acquisition strategy.

A true leader can create a new paradigm. In order to keep the path to a changing paradigm continuously open, a leader needs to be very actively involved in learning and sharing knowledge.

Leaders as Catalysts
One need not be a President or a Chairman in order to be a leader. When I was the strategy advisor for Koç Holding, we began to implement the total quality management philosophy and were initially viewed with some distrust akin to “Where did this come from?” Today, I am extremely proud of having an instrumental role in initiating the Koç 2000 Project, and am pleased to have motivated so many people into action. With the trust we earned from the top echelons of Koç Holding, we were able to further expand and implement larger, new projects.. While we had great challenges implementing international accounting and information systems standards at Koç Holding, they stood the scrutiny of international investment banks and audit firms for transparency and accountability.

Two companies from the Koç Group won National Quality Awards in Turkey and one of the companies won a similar award in Europe. This was not even a remote possibility five years ago. I did not hold an executive position at the Koç Holding. I was nothing more than an outside consultant. Yet with the support of many qualified individuals within the Group, we were able to initiate and realize significant changes.. When you are well equipped and familiar with the task that needs to be undertaken, and if you have earned the trust of the executives, much could be accomplished. When you have a clear vision and people’s trust, you do not need the power of a position, like President, because real influence arises from vision, knowledge and trust, and not from position.

In summary, a leader is both a catalyst as well as a source for knowledge. Leadership is not achieved with directives, but by motivating and inspiring people, continuously providing positive feedback, and promoting good examples and benchmarks.

 

Change and Transformation

In order to change the manner in which a person operates, it is vital to change their belief system as well, and this takes time and patience. This is one reason why effective communication is so important. During the transition period, it will be paramount to continually reinforce the vision and how the current tasks relate to that vision. This reinforces creativity, wins people’s trust, and improves their learning process.

In the workplace, it is not possible to sustain leadership without also taking into consideration the bottom line of the business. The financial numbers are very important, but not the singularly most important factor in the workplace. While good vision will also encompass the financial side of the business, it is a misleading to focus only on the financial returns. Instead, we should focus on providing a return on all the resources we use, including the environment and the community. In short, we should be concerned with providing a return for all the resources we use, regardless of who owns them and whether there is a functioning market for them.

Opportunities and Change
People are more apt to find opportunity in those areas of their life that interest them. The adage “Luck favors the prepared mind” is an accurate description of this phenomenon. Being prepared improves perception and will positively impact how you are able to direct your resources and you will be able to achieve your goals. For example, when you are expecting a new baby in the family, all of a sudden you begin to notice others with baby strollers. If you are planning to buy a car, you will take notice of classified advertisements selling cars. Every day there are enormous opportunities in the stock market. However, for somebody who does not follow the stock market, these opportunities are out of reach.

An excellent leader has great diversity in his interests outside of his expertise. Most successful leaders have a wealth of interests in different fields. Vehbi Koç is one who had interests ranging from education to health. Another example is Winston Churchill. Rich and diversified interests add a dimension and depth to your understanding of the environment, which in turn helps develop better strategies. Knowledge in different areas improves one’s creativity. This requires dedication and hard work. Sustainability of change requires organizational readiness. This in turn requires a fundamental and thorough understanding of the organization.

 

Summary

Leadership is all about setting examples of a vision and then expanding and enriching those examples.

Success is no longer measured by narrow, internal metrics for an organization but requires a broader externally focused metrics. If we can infiltrate this belief into organizations of our society, it will pave the way for our country to stand with other leading nations of the world. We should set our goals to be international benchmarks, not merely better than last year.

For example, the National Quality Movement helped many Turkish institutions win the top quality awards in Europe. The National Quality Conference in Turkey achieved a status of being the largest Quality Conference in Europe. Turkish was accepted as one of the official languages in the European Foundation for Quality Management. Furthermore, Turkey’s very successful hosting of the European Quality Foundation’s Congress in Istanbul in 2000, has amply demonstrated the quality of the management of the Turkish Quality Association.

In short, aiming high, trying not only to meet international standards, but to establish examples that will set the standards has proved to be the basis of success. By implementing this understanding in all of our institutions, the quality of life we deserve will be attained.