Storytelling Is A ‘Foundational’ Leadership Skill, According To McKinsey

Public speaking with an emphasis on “storytelling” is a foundational skill for CEOs and leaders in the next decade, according to a McKinsey & Company study of 18,000 business professionals across 150 countries.

Leaders who share stories are more likely to align teams, motivate employees and inspire new recruits, customers and stakeholders.

Storytelling is one essential skill that sets apart the best CEOs from the rest, says Carolyn Dewar, a senior partner at McKinsey and co-author of CEO Excellence. I talked to Dewar recently about McKinsey’s research and why CEO storytellers are needed now more than ever.

“Storytelling applies to leaders in any field,” Dewar told me. “It’s core to the leadership role now. A leader’s role is to set the vision and align and mobilize teams to go after it.”

People who are internal to a company want answers to a few questions such as:

What is the vision?

Where are we going?

What does success look like?

What is my individual role?

How do we collectively accomplish the mission?

Dewar says that the best CEOs answer these questions and bring them to life through stories. “Stories are how we humans learn and understand expectations,” she says.

There are different types of stories that successful leaders share. Some stories are personal anecdotes, while others include customer stories and case studies. Dewar also encourages CEOs to leverage the power of a company’s history to guide its future.

In other words, the best CEOs look back to move forward.

“Our research found that the best CEOs often dig back into a company’s history to find out what originally made it successful and then take that central idea and expand it in ways that open up new opportunities, Dewar writes.

For example, Intuit, the maker of QuickBooks and Turbotax, was founded in 1983 by Scott Cook. The company’s founding mission was to “end financial hassles.” But, according to McKinsey researchers, when Brad Smith joined Intuit and took over the CEO’s job in 2008, the company faced daunting challenges that it had not encountered two decades earlier. The world was shifting, threatening to make a desktop software company irrelevant.

“Smith felt the essence of Cook’s vision was still relevant, but how it was expressed and pursued needed to change,” according to CEO Excellence. As a result, Smith kept the spirit of Cook’s founding mission, but updated the language to make it more contemporary and relevant to the age of cloud computing.

Smith led Intuit for eleven years with the new mission: “powering prosperity to meet the needs of an increasingly connected world.” According to McKinsey, under Smith’s leadership, Intuit doubled the number of customers and tripled its earnings.

Smith offered the following advice to new and aspiring CEOs:

“Have a vision that is so clear, a leader doesn’t have to do anything but get out of the way. That’s the most inspiring vision of all.”

CEO storytellers often motivate people to do more than they thought possible, but only when stories are shared constantly and consistently throughout the organization. And in many cases, stories that are shared long after the company’s founders are gone are among the most inspiring.

For example, most of Medtronic’s 100,000 employees around the world have heard the story of the medical device maker’s founder, Earl Bakken, who passed away four years ago. In many ways, it’s a classic American success story.
Bakken fixed medical equipment from the garage of his Minnesota home. He made $8 in his first month. In 1957, an event changed his life. An electrical grid went down and cut power to three states, cutting off the lifeline for patients connected to electrical pacemakers plugged into wall outlets. Bakken spent four weeks in his garage working on a solution. He emerged with the world’s first battery-powered pacemaker.

The event inspired Bakken to build a company “to alleviate pain, restore health, and extend life.” Sixty years later, the mission continues to serve as the company’s guiding principle.

That’s the power of a legacy story. Some of the words of a company’s founding mission can change—like they did at Intuit— but a CEO’s role is to maintain the spirit of innovation the words have always represented.
By sharing stories, the best CEOs can cut through the clutter and create clarity in an increasingly volatile, uncertain, complex and ambiguous world. Storytelling is foundational.