‘Unleash the Power of People’

Yum! CEO David Novak leads by saying 'thank you'

By Christina Folz Jun 24, 2014

Novak mug for web.jpgORLANDO, FLA.—You can’t go it alone if you want to accomplish great things, David Novak said at the June 24 general session of the 2014 Society for Human Resource Management Annual Conference & Exposition. 

While that may sound obvious, it’s a lesson that many prominent business leaders, including legendary General Electric CEO Jack Welch, had to learn the hard way.

Fortunately, the 13,000 attendees who attended​ Novak’s talk don’t have to. The visionary CEO of Yum! Brands Inc., which operates more than 40,000 KFC, Pizza Hut and Taco Bell restaurants in more than 125 countries and territories, shared some of the secrets to great leadership that have led to his astounding success. 

Key among them: “There’s no way you can get something done without taking people with you,” he said. “You have to believe this in your bones or you wouldn’t be in HR.”

With Novak at the helm, Yum! experienced double-digit growth for 10 consecutive years. He was named CEO of the Year by Chief Executive magazine in 2012, and he was one of Harvard Business Review’s “100 Best-Performing CEOs in the World.” He shared his leadership philosophy in Taking People With You: The Only Way to Make Big Things Happen (Penguin Group, 2012).

Me Becomes We

He didn’t grow his company by making tough calls alone in a corner office or cloistered in a boardroom. He listened to his employees and created a culture of recognition. 

“You have got to celebrate other people’s ideas more than your own,” Novak said. “I always look for great things that are happening in our company and say thank you.

He has learned from the best. Early in his career, he had the opportunity to have dinner with Welch, whose books he had devoured as a student of leadership. When he asked Welch what he would have done differently in his career, Welch talked about having been perceived as a lone ranger. Although his decisions had been sound, people didn’t always understand his reasons for making them.

“He told me to galvanize the company around what you want to do from the beginning,” Novak said.

Developing Leaders

Novak took the advice to heart, developing a leadership program based on the concepts of inclusion and transparency. He taught the course to 4,000 Yum! leaders over 15 years before rolling it out to 40,000 general managers. 

“I make developing leaders my No. 1 priority because it pays back in spades,” Novak said.

When people ask him how he finds the time to teach, he explains the dividends it brings. In his program, he asks his leaders to work toward developing the one thing that will have the most impact in their job. 

“If everyone gets their biggest thing done, do you think the company will grow?” 

Acknowledging Employees

Recognition is at the heart of the Yum! culture. When Novak became president of KFC, sales were down and morale was low. He needed a way to “break through the clutter” and start driving results. 

“The biggest way to do that was to start recognizing people in fun ways,” he said. He began giving people floppy chickens as special recognition awards, along with $100. He also takes a picture of himself with each employee, which he gives to them and hangs a copy in his own office. 

“Guess what? People loved it,” he said. “They cried at times. It created smiles and it created tears and it moved people emotionally.” It wasn’t long before sales—and morale—picked up. “It’s the soft stuff that drives hard results.”

Listen and Trust

Novak believes that a good leader listens and believes in “the power of positive intentions”—the idea that, at the end of the day, people want to work hard and do well. “You have to unleash the power of people,” he said. “Once you feel like you’re not needed, you’re through.”

Today, as the head of Yum! brands, Novak has expanded his recognition program to include cheese heads, giant Taco sauce packs, and a set of wind-up walking teeth for his special “Walk the Talk” award. His office walls are now almost completely filled with employee recognition photos. He plans to start putting them on the ceiling.

Christina Folz is the editor of HR Magazine.


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