Dr. E. Ted Prince, CEO 

Dear Top Executive A few more ideas from the Perth Leadership Institute that might just improve your performance as a top executive,  make your company more valuable, you and your employees happier... Current preoccupations: does the CEO have a financial signature that predicts his or her company financial performance? What can a leader do in their first 90 days to avoid failure later? Any ideas or suggestions? Email us at etedprince@perthleadership.org or call at (352) 333 3768. Suggestions and ideas always welcome. Ted The Financial Signature™ of Leaders   Do leaders have personal financial traits that lead their organizations to have a characteristic financial performance? This issue is one that is being researched extensively by the Perth Leadership Institute. It is a crucial area. If it is true, then it opens up a totally new perspective on leadership. It raises the possibility that organizations run by certain types of leaders will have a characteristic valuation trajectory and outcome. That would be a revolutionary finding.   We term the personal financial traits of leaders, the financial signature™. This has been a focus of much of our research. The underlying model behind our financial signature™ approach can be operationalized and measured. Our research shows that the financial signature™ does indeed correlate with the financial performance and the valuation outcome of companies and enterprises. Still, with such a new concept, is there any other research which provides some validation?   A path-breaking piece of research carried out by two academic researchers provides such support. (Bertrand, M., and Schoar, A., “Managing with Style: The Effect of Managers on Firm Policies”, Quarterly Journal of Economics, November 2003, vol. 118, issue 4, pp. 1169-1208 see http://mitpress.mit.edu/) The research shows that a leader’s personal traits, rather than just the combined effect of their culture and organizational environment, account for a significant proportion of the investment, financial and organizational outcomes of companies. In other words, there exist personal financial traits in leaders, which hitherto have not recognized, that produce systematic and characteristic impacts on the organizations they lead in terms of financial performance. Our research on financial signatures models these traits and the specific financial and valuation outcomes which are associated with each of them.   The financial signature™ of leaders has wide-ranging ramifications. In effect it links organizational psychology with the theory of the firm. To date, leadership theory has been either based on a clinical psychology or a competency based approach. The Holy Grail of leadership theory links personal variables with company outcomes and company valuation. In effect this is a theory that belongs to the emerging field of behavioral economics. Our research into the financial signature™ of leaders promises to be a new contribution to this linkage.   Our approach to financial signature™ has some practical consequences and implications in real life. Coupled with our leadership assessments (specifically the Executive Outcome Assessment) it enables us to predict the valuation consequences for a company of their particular leader. Armed with this knowledge we can show how strategies can be modified to increase company valuation. This is a new and unique service that is possessed by no other company in the leadership area.   To find out more about this approach and how it can help you increase the financial and valuation performance of your company, contact us at info@perthleadership.org.   Recommendations   Assess how your personal traits impact your company’s financial performance. Complete Perth's Executive Outcome Assessment to help you find out. Perth Leadership Institute News  Perth has now released the following leadership outcome assessments:   Emerging Leader Assessment  (ELA) Executive Outcome Assessment  (EXOA) Team Outcome Assessment  (TOA) Ideal Occupant Characteristics Outcome Assessment  (IOCA) The ELA is aimed at early to mid-career professionals who aspire to leadership positions. The EXOA is designed for experienced executives and serving CEOs, including those starting up companies. Each of these assessments offers a unique understanding of the linkage between the personal profile of the potential leader and the outcome and financial performance of their company or organization. The ELA and EXOA are taken online. The other assessments are proivided offline. The TOA and the IOCA are completed by groups of individuals who each take an online assessment and are provided with a composite report. Email us at assessments@perthleadership.org if you would like to learn more.   Become an Affiliate for Perth Leadership Assessments   We are in the process of launching our Affiliate Program and already signing agreements with organizations that wish to become affiliate marketers of our  assessments. Partner with us and add valuable resources and content to your site. Earn commissions from assessments completed by visitors to your Web site - at the same time improve your own web site traffic and visibility! Email us at info@perthleadership.org to find out how you can start earning today!   Upcoming Seminars and Conferences   July 16 - University of Florida, Comprehensive Dental Program, Gainesville, FL. “Leadership Development for Medical and Dental Professionals”   August 3-5 - University of Florida, Leadership Development Institute, Gainesville, FL. “The Perth Leadership Outcome Model”   October 4-6, 2004 - University of Florida, Leadership Development Institute, Clearwater, FL. “The Perth Leadership Outcome Model”   October 12-14, 2004 - University of Florida, Leadership Development Institute, Boca Raton, FL. “The Perth Leadership Outcome Model”   Nov 5 - International Leadership Association, Washington, DC. “CEO Boot camp and Workshop - Impacting Leadership Outcome” The Last Word "You can only find truth with logic if you have already found truth without it." G. K. Chesterton         About The Perth Leadership Institute.    Leadership Solutions is a publication of The Perth Leadership Institute www.perthleadership.org.  Office at 8524 SW 23rd Pl, Gainesville, FL. 32607. Telephone: (352) 333 3768. Email info@perthleadership.org. Copyright. All rights reserved. Articles may not be copied or reproduced without the permission of the Publisher. The Perth Leadership Institute is a developer of a proprietary leadership system based on its Perth Leadership Outcome Model.  The Institute licenses its methodologies and assessment instruments to organizations that provide training and development to emerging and serving leaders. These include training companies, nonprofit organizations and educational institutions.

Inside This Issue The Financial Signature of Leaders  The First 90 Days of Leadership  Perth Leadership Institute News About The Perth Leadership Institute The Last Word The First 90 Days of Leadership   We were reminded of the crucial early days of a leader’s tenure by a recent article on this subject (Watkins, M., “Strategy for the critical first 90 days of leadership.” Strategy and Leadership, vol. 32, no. 1, pp 15-20, see www.emeraldinsight.com/sl.htm; based on his book The First 90 Days: Critical Success Factors for New Leaders at all Levels, Harvard University Press, 2003). Watkin’s thesis, with which we agree, is that the actions that a new leader takes in the first three months of his or her tenure, largely determine the likelihood of success or failure in the long-term.   We would argue, indeed, that long-term success or failure is determined even sooner than he says. It is set in the first few weeks, or even days. This is because, as Watkins nicely outs it, that “the root causes of transition failure always lie in pernicious interactions between the situation, with its opportunities and pitfalls, and the individual, with his or her strengths and vulnerabilities”. In other words, you have to know the personal profile of the leader.   Predicting the chances of a leader succeeding or failing is critically dependent on knowing the personal profile of the new leader. We must know not just his “personality”, however we define it, but also his innate approaches to business factors. If we can measure these innate approaches we can start to understand just how he will tend to push the various buttons that are available to any leader in choosing how he or she will pilot the enterprise.   Too many times, in selecting new leaders, we are aware of their past achievements, but do not understand their innate approaches to business matters. Past achievement will of very little use to use if the leader's innate approaches are not congruent with the objective requirements of the company in its particular market at its particular stage of evolution. That is why so many boards fail to make the right CEO selection and why so many leaders fail. The message: we must understand the leader’s personal profile, the areas of business strategy and execution with which he is comfortable, and more importantly the areas in which he or she is not comfortable. It is only through understanding these that we have any chance at predicting likely job performance and the likely enterprise outcome of his or her leadership.   Perth’s leadership assessments adopt such an approach. Rather than focusing on personality variables, we focus on the impact on an organization’s financial performance and valuation of a particular personal profile. Areas in which leaders are weak lead to characteristic outcomes which is why we can be so sure of a leader’s chances of success. Once we understand these vulnerabilities, appropriate correction action can be taken. As part of their responsibility for good corporate governance, it is incumbent on boards to understand this aspect of leader selection when hiring or promoting a new CEO. Too few do this, to the eventual detriment of the company’s financial performance.   Our Executive Outcome Assessment adopts this approach with experienced executives to help them develop so that they can use the first 90 days constructively. Our Emerging Leader Assessment (available online at www.perthleadership.org/ela.htm) applies this approach to experienced executives and mid-career professionals. It provides them with guidance concerning where they need to focus to overcome their vulnerabilities. This will help them lead their new organization to a higher-valuation outcome than they would have achieved otherwise.   Recommendations   Provide new or potential leaders guidance on what to expect in the first 90 days. Assess their personal profile to find out where they are likely to have problems.

info@perthleadership.org (352) 333 3768 www.perthleadership.org