You may be asking who is Lynn Good? She is the new CEO of Duke Energy Corporation, the largest utility in the United States. She was promoted from her position as Chief Financial Officer having worked with Duke Energy and the company Duke acquired for over 20 years after being an auditor of utilities. As reported by The Charlotte Observer today, she is only the 7th female to head one of the nation’s 200 utilities. This is good news from two major fronts.
The obvious one is a very credible candidate who happened to be a woman was promoted to CEO. I use this phrasing as her credentials would make her a great candidate irrespective of her gender. In addition to her job at Duke, she has also been one of Duke’s champions to the community, serving as Board Treasurer for the Arts and Science Council in Charlotte, Duke’s headquarter city. Plus, she has a depth of financial knowledge about utilities based on her experience and per The Charlotte Observer loves her job due to its complexity of financial and regulatory challenges. I know we should all love our jobs, but when someone publicly marries reasons like this for her joy at working for Duke, that says a lot, as running a publicly traded utility has many moving parts.
Yet, to see a woman justifiably achieve a promotion like this makes you feel progress is being made toward reducing the gender deficit at the top. Good was a computer science major, so she has always been one of the few women in her class or field. I hope and believe that is changing, but having some lightning rods like her can only help in more girls pursuing STEM degrees.
The other reason her promotion is important is due to her promotion from within. I say this as a shareholder of Duke Energy. One of my favorite business books is called “Built to Last” by Jim Collins. His team looked at the best companies in industry over time and how these companies dwarfed the results of their nearest competitor. They were built to last. One of the several tenets for their success was called “homegrown management.” I won’t quote this statistic exactly, but the book said out of the 500 leaders these 18 companies had in their histories, 495 of them were promoted from within the ranks. I wrote a post last April about this book which defines the key tenets for their success, so if interested, here is the link:
The key to this success is there are two types of knowledge about your job – one is extrinsic and the other is intrinsic. The former is what you know about the job that is portable and is of value to a new employer. The latter is what you know about getting your job done at your company. You know how to navigate the company – whom to call upon and whom to avoid. This knowledge is less valuable to a new employer, which is why some folks don’t succeed when they change jobs.
My old company made a habit of hiring people from outside. The new CEOs did not have this intrinsic knowledge and often brought in others from outside who they trust, but these newbies did not have the intrinsic knowledge either. So, they may not know a new idea of theirs was tried and failed. They may not know that the person who merchandises themselves best to the new leaders is part of the problem. They may be overlooking the folks who are quiet but very effective. So, they usually do not succeed. My old company eventually would fire these leaders and go get new ones who did not have this intrinsic knowledge either. This is a key reason I am glad I know longer work there.
So, I am very happy for Lynn Good and Duke Energy. Both women and the company have a great standard-bearer. I think both will be well served. And, as a shareholder, I like that. Well done.