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Level 5 Leaders Characteristics and Operating Style

Exhibit: 9.1 Cain as a Level 5 Leader

George Cain (Cain), the CEO of Abbott laboratories was a level 5 leader. When he became the CEO, Abbott laboratories was a family run mediocre organization.

In the 14 years he was at the helm, he drove the company with relentless ambition and professional will. Cain identified immediately after taking up the job that the reason for Abbott's mediocrity was nepotism.

Then he started systematic rebuilding of the executive team and board. He made sure that family relation is no more a shortcut to higher position in the company. He made it very clear that any executive in the company must be the best in the whole industry, within a span of responsibility. He fired every executive who was not upto the standard. This sort of ruthlessness can be expected only from an outsider who joined as the CEO. But Cain was an insider for 18 years.

He was a member of family that previously ran Abbott laboratories. In the end, even the family was happy as the company performed 4.5 times the general market between 1974 and 2000. Blue chip companies like Merck and Pfizer performed only twice the general market in this period.

Adapted from “Onward and Inward”, Across the board, Sep/ Oct 2001, Vol. 38, Issue 5.

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