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Best Business Books 2020: Talent & leadership

From the outside in

Rosabeth Moss Kanter
Think Outside the Building: How Advanced Leaders Can Change the World One Smart Innovation at a Time (Public Affairs, 2020)

Stefanie K. Johnson
Inclusify: The Power of Uniqueness and Belonging to Build Innovative Teams (HarperBusiness, 2020)

Pamela Newkirk
Diversity, Inc.: The Failed Promise of a Billion-Dollar Business (Bold Type Books, 2019)

The year 2020 turned out to be a watershed in leadership, as many executives were suddenly challenged to rethink their business, their future, their people, and their place in the world. The aftermath of the year’s disruptions and the lessons that have been jarringly forced upon leaders will continue to influence how organizations are led for decades to come.

One theme emerging from the crisis has been an erosion between what is public and what is private, between what is properly the concern of the social sector and what responsibility is held by business. A second and related theme is the recognition among the most perceptive leaders that injustice cannot be effectively addressed without their active learning and participation.

This year’s three best business books on leadership are highly relevant, even essential, for leaders who are seeking to answer the most salient question of the moment: What comes next? In the most compelling of this year’s crop, Think Outside the Building, Rosabeth Moss Kanter, professor at Harvard Business School, provides a comprehensive guide for the systemic rebuilding and reimagining that will be required as leaders attempt to negotiate a new future. In Inclusify, Stefanie K. Johnson, professor of management at the University of Colorado, Boulder, Leeds School of Business, draws on a wealth of research to explore the behaviors most likely to undermine efforts to build inclusive cultures. And in Diversity, Inc., Pamela Newkirk, a journalist and professor of journalism at New York University, details the excruciating ineffectiveness of organizations’ efforts to address racial inequality, while offering insights that light a path forward.

What is an advanced leader?

Rosabeth Moss Kanter defines an advanced leader (AL) as someone who has had a successful career in one sector and then commits to tackling big, intractable problems in the social, environmental, or medical realm: Think Bill Gates’s global health initiatives after his retirement from Microsoft. But ALs can also start quite young. Wendy Kopp was just 22 when she founded Teach For America, a nonprofit that enlists college graduates to teach in public schools. Advanced leadership, in Kanter’s words, is really “less a stage of life than a mode of action,” distinguished by the breadth of its scope and a willingness to work across boundaries and silos, outside established structures.

Kanter’s insights about what inspires such leaders, how they leverage connections and harness resources, how they exercise influence without formal authority, and how they address unforeseen and inevitable setbacks are drawn from her experience with the Harvard Advanced Leadership Initiative (ALI), a kind of leadership laboratory she cofounded in 2009. ALI fellows from around the world spend a year at Harvard, primarily upon retiring from high-profile leadership positions within major institutions.

While in Cambridge, they build the skills, the networks, and — perhaps most important — the capacity for deep reflection that will enable them to transmute the glimmer of an ambitious dream into something that makes a tangible difference in the world. Over the last decade, ALI fellows have founded more than 100 new entities, products, or services and have been instrumental in transforming existing organizations focused on social change. John Dubinsky, a bank CEO in St. Louis, founded the Contractor Loan Fund to provide capital to minority construction companies in his city. Richard Fahey, a corporate lawyer from Columbus, Ohio, was inspired by his pre–law school work with the Peace Corps to create the Liberian Energy Network; it brings alternative energy to rural areas in that country so that children living in villages can do their homework at night. Think Outside the Building: How Advanced Leaders Can Change the World One Smart Innovation at a Time tells the story of these and many other ventures, providing a rich and engaging account of lessons learned by those who turned inspiration into reality.

Kanter’s lessons are distinguished by their detail and specificity, which makes her insights useful as well as thought-provoking. It’s rare that a book manages to be both magisterial and accessible. Think Outside the Building offers a trove of real-life stories that illustrate each point with precision and zest. Changing highly resistant, complex systems is a weighty topic, but this book feels light — not in the sense of being insubstantial, but in being practical and human.

Making the transition from helming an established organization to stepping into the moonshot world of social innovation requires that leaders reinvent themselves. Entrepreneurial skills — rare in an institutional setting — are paramount in this undertaking, as are humility and the willingness to hustle. Leaders also need to learn how to function without the bubble pack that typically keeps those at the top insulated from open disagreement and encourages even the best of them to assume certain rights and privileges as their due. And they need to shed the kind of conformity that being part of a high-status peer group typically instills.

To ease the transition, Kanter notes that leaders require scaffolding, a temporary superstructure of support. Drawing on her ALI experience, she identifies the key elements in the scaffolding needed to prepare former establishment players to “attack the castle” — to take on institutional structures that have become ossified or entrenched in self-protection.

One of these elements is bridges, which can include volunteer efforts or service positions that challenge people’s accustomed ways of operating. Boards serve as useful sources of cross-sector connections and provide a chance to exercise new skills. Garrett Moran, former senior managing partner and chief operating officer at the Blackstone Group, became active on the board of Year Up, a nonprofit that provides training and internships to inner-city youth. The board enabled Moran to move from inhabiting the rarefied precincts of high finance to engaging often-shattered communities in the painful work of renewal. Other types of scaffolding include new clubs that provide peer support, a fresh referent group, and the kind of social ties that strengthen commitment and normalize a passion for change.

Kanter’s practicality is highlighted in her chapters about building the kind of “large cross-sector multi­stakeholder coalitions” required to support institutional change. She breaks down this effort by detailing specific techniques for engaging three essential groups: allies, opponents, and undecideds. Her stories about former Trader Joe’s president Doug Rauch, who founded Daily Table, a nonprofit community grocer in Boston that provides fresh, healthy food to underserved communities, vividly demonstrate the effectiveness of this approach. Rauch’s masterful handling of a local cop who, in defense of free food, had brandished his gun in the face of an obdurate health inspector exemplifies flexibility under duress.

Think Outside the Building also identifies the specific hurdles that typically hinder ambitious and well-intended undertakings — at the start of the venture, in the middle, and when it is poised to grow. Transformational leadership has become a buzzword. But Kanter brings extraordinary resources to breaking down what exactly is required of individuals seeking to bring positive change to the world.

The quest for inclusion

Diversity is not a “goal,” as many organizations would have it. Rather, it is simply the nature of the global talent pool. Inclusion is the means by which this diverse pool is effectively engaged. The organizations most likely to reap benefits from their workforce are those in which inclusive practices become the norm.

In Inclusify: The Power of Uniqueness and Belonging to Build Innovative Teams, Stefanie K. Johnson takes on the tough task of identifying the chief behavior patterns that undermine well-intentioned efforts to create inclusive cultures. Because her descriptions are detailed, specific, and illustrated with stories drawn from real life, the book should serve as an invaluable resource for leaders seeking to instill inclusive practices throughout their organizations by encouraging behavioral self-awareness.

Johnson notes that the chief challenge of inclusion lies in balancing the natural tension between two deeply felt human needs: the need to feel authentic and the need to belong. Inclusion efforts fail when they do not reconcile this tension, either by sending the message that people need to conform in order to be recognized as part of the team, or by failing to make people with outside-the-mainstream biographies or unorthodox qualifications feel as if they belong.

Johnson wisely observes that most people in most organizations do not experience inclusion as a result of a stated commitment from senior leadership. They experience it — or don’t — in the actions of their supervisor, their immediate manager, or their team leader. This point is vital and often missed. Perhaps the most common reason inclusion efforts fail is that they put insufficient focus on engaging midlevel managers, who may mouth CEO commitment statements but then frustrate them with behaviors that contradict the official message. As Johnson points out, even in organizations in which the CEO has made inclusion a benchmark of success, fewer than 40 percent of employees believe their direct managers share this value. “Inclusifyers,” in Johnson’s description, are people at every level who are skilled at productively engaging diverse teams.

Johnson wisely observes that most people in most organizations do not experience inclusion as a result of a stated commitment from senior leadership. They experience it — or don’t — in the actions of their supervisor, their immediate manager, or their team leader.

The heart of her book is devoted to examining the myths and mistakes that derail leaders’ efforts to create inclusive cultures. Johnson’s analysis identifies archetypes and then draws on real-life stories to illustrate the pitfalls of each. Archetypes include the Meritocracy Manager, who assumes that the best credentials always predict the highest performance; the Culture Crusader, who overvalues team homogeneity; the Team Player, usually a woman or person of color who has worked hard to assimilate and is reluctant to identify with others in his or her group; the White Knight, who holds women or people of color to a different standard in the belief that doing so will help them; the Shepherd, usually a woman or person of color who offers only in-group support and stereotypes those assumed to be more privileged; and the Optimist, who believes that gender or racial divisions tend to get better over time and so supports the status quo through inertia.

As this brief listing makes clear, non-inclusive behaviors and attitudes appear in groups beyond white males. Anyone can make assumptions that undermine their ability to demonstrate inclusion. I would bet that virtually all readers will see some aspect of themselves reflected in the detailed descriptions Johnson provides. But Inclusify does not simply chronicle the kinds of behavior that derail inclusion efforts. It also examines and recommends specific inclusifying actions that individuals and organizations can undertake to rectify damage that may already have been done. Meritocracy Managers can be more specific in describing what they hire for (international experience rather than “the best person”); Culture Crusaders can expand the range of bonding activities instead of remaining wedded to those that send an exclusively in-group message; White Knights can seek out reciprocal mentoring.

Though the categorizations set forth in this book can at times feel like unnecessary typology, Johnson’s work offers an unprecedented range of tools for leaders intent on building inclusive cultures. Inclusify is also enriched by revelations and observations drawn from Johnson’s own journey from humble beginnings as a self-described “poor Mexican-American child” to the heights of academic achievement. She is particularly good at describing how her own assumptions about the objective nature of meritocracy have been challenged by both her research and her experiences.

Why diversity initiatives fail

Simple demographics, along with several decades’ worth of hefty discrimination settlements, have created a sense of urgency about addressing unequal outcomes in workplaces large and small. The result has been an upsurge in diversity initiatives, training programs, and various kinds of awareness workshops, leading to what Pamela Newkirk calls Diversity, Inc.: The Failed Promise of a Billion-Dollar Business. The author, a Black journalist, demonstrates courage, lucidity, and insight in examining what this investment has mostly wrought. As she recounts the comprehensive and influential efforts to address diversity undertaken by giants like Coca-Cola (in the wake of a historic lawsuit), Xerox, and IBM, she also surveys the broader landscape and finds even those programs designed with the best intentions are troubled, inadequate, and in some cases harmful.

Newkirk notes three potential outcomes that research suggests are not uncommon. First, the “D&I” (diversity and inclusion) investment may simply fail to pay off, making no discernible difference in the culture or the numbers. This can stir cynicism and damage the commitment to addressing inequality. Second, and more troubling, the efforts can have an adverse impact, with the proportion of women and minorities on staff actually declining in their wake. Newkirk notes that this kind of decline usually occurs when training is mandated or focused on sharing academic models and constructs. Third, these efforts, especially when focused on surfacing bias, can create backlash and deepen divisions by alienating and even shaming those assumed to be privileged. One study she cites concluded, “many [of the participants] interpreted the key learning as having to walk on eggshells around women and minorities.” In addition, asking people to focus on differences can lead inevitably to questions such as “but aren’t we all different?” Such discussions quickly become theoretical and divorced from real life.

The book isn’t simply a critique. Newkirk also examines what successful initiatives, especially those intended to increase representation of minorities at senior levels, have in common. The answer lies not in training or prejudice-reduction programs, but in robust efforts to hire and recruit accompanied by the creation of long-running task forces with the power to hold institutions accountable for quantifiable progress. These approaches, deployed in combination, can yield 30 percent increases in the representation of women and minorities in senior roles over the course of five years.

Newkirk examines how open various sectors have been to seeing the potential of a diverse talent pool and how effective their efforts to engage its challenges have been. The corporate sector comes off best, academia and entertainment are well behind, and the sports sector is wildly uneven. In entertainment, nepotism, elitism, and amateurish practices help shape the culture, whereas in higher ed, the divide between faculty and administration, along with the fear of alienating prosperous parents, makes comprehensive strategies a challenge.

When it comes to the corporate sector, Newkirk echoes Johnson in citing how the blunt belief in the existence of a meritocracy can undermine an organization’s ability to imagine the benefits of skills that don’t show up on test scores — such as resilience and commitment. A more subtle approach to assessing who benefits from a range of advantages is therefore in order. Here Newkirk is highly pragmatic, noting that interest in and commitment to racial justice in particular has always been prompted by crisis, which creates a fertile climate for addressing change. Yet every step toward progress has historically been met by resistance, fueling “an ongoing dance of advance and retreat.” Progress, she therefore notes, is usually ephemeral, requiring continual monitoring, constant vigilance, and ongoing assessment of what works and what does not.

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