The 3 "Be's" of Leadership
During my many years as a corporate leader, and more recently as an executive coach, I have experienced the pain of watching leaders react and succumb to the stress and volatility of today’s global workplace.
There is no debate that in today’s chaotic and “high-flying” environment, the role of a leader can present many daunting challenges. Yet that same ecosystem can offer significant opportunities for a leader to excel in their role and have a critical impact.
It all comes down to the strategy the leader utilizes to “ground” their perspective in relation to their environment, their organization, their team and themselves. One approach I apply with myself and my clients is to practice the "3 'Be’s' of Leadership."
1. BE present
Leaders should be keenly aware of each moment so that they are actively attending to what is going on around them.
With distractions easy to find and hide behind in today’s workplace, leaders need to create an environment that is spotless from any such diversions. Set aside a period of time each day that is considered “sacred and sterile” and focus on the person, team or situation you have in front of you. Listen to what they are saying. Listen to understand and not to reply. This attention to being present will, in turn, pivot your perspective from a reactive to a proactive mode.
This is easier to write about than to implement, so start out with creating your “Spotless Seconds” -- short bursts of time, (i.e. seconds), that are free of any interruptions. I guarantee you will see a difference in your clarity of thoughts and subsequent actions.
2. BE deliberate
Leaders should be deliberate with each action, decision and act of communication.
With leaders being pulled in every direction and needing to respond quickly to the many questions and issues that arise, it is very easy for leaders to answer on “auto-pilot” and not think through their thoughts and actions. However, by creating “Spotless Seconds” to attend to what is front of you, a leader can be very deliberate in their actions, their responses, and their decisions.
Think about the purpose of why you are doing what you are doing in that second, and then think about the desired outcome you want to achieve with that purposeful action. By taking a moment to be deliberate about your next step and aligning that with your desired outcome, you will set yourself apart as a deliberate and thoughtful leader from the many others who are leading by “accident.”
3. BE grateful
Leaders should realize that it is not all about “me” by releasing their ego and expressing their gratitude on a daily basis.
When creating your un-interrupted time, your “Spotless Seconds," use that time to express your gratitude to your organization, your team, and to your community. Having a leadership role is an honor and not a burden.
So many leaders do not express their gratefulness for being in a role that enables them to enact change, influence outcomes and generally make a difference in the world. That has to stop. Leaders should say a genuine “thank-you” to their peers, their clients, their team members, their managers, their vendors, and to their stakeholders.
It takes such a short amount of time to say “thanks," so make that a part of your “Spotless Seconds” and help move the gratitude needle forward, second-by-second.
An Emerging Theme In Thematic Investing
Exchange traded funds (ETFs) are popular vehicles for market participants looking to engage in thematic investing. Thematic investing looks to take advantage of future growth trends, including disruptive technologies. Given that forward-looking approach, stock-picking in the thematic universe is equally as hard, if not harder, than in traditional market segments.
Go back to the late 1990s, before the bursting of the Internet/technology bubble. Back then, investors stood an equal chance of selecting E-Toys over Amazon or some no longer in existence networking equipment maker over Cisco.
“History is littered with examples of prospering industries with no indication of which company will come to dominate the industry,” according to Nasdaq. “This suggests that successful thematic investing is more about selecting baskets of investments rather than single securities.”1
The ALPS Disruptive Technologies ETF (DTEC) provides basket exposure to a broad swath of thematic investments. DTEC features exposure to not just one or two emerging technologies, but 10 such themes on an equal-weight basis.
The 10 themes represented in DTEC are as follows: 3D printing, clean energy, cloud computing, cybersecurity, data and analytics, fintech, healthcare innovation, Internet of Things (IoT), mobile payments and robotics and artificial intelligence (AI).
Generally speaking, fund issuers have been quick to respond to disruptive and transformative technologies, bringing products to market to tap these themes. Prior to DTEC coming to market late last year, there were ETFs devoted exclusively to cloud computing, cybersecurity, robotics and other themes featured in DTEC. However, few use the basket approach to themes employed by DTEC.
February, a rough month for U.S. stocks, highlighted the advantages of DTEC's multi-theme methodology. Seven of the 10 themes found in the fund finished the month lower, but DTEC was able to outperform the S&P 500 on a monthly basis.
Focusing on individual themes can be rewarding over the long-term, but not all investors have the risk tolerance for such a strategy. Consider this: the Indxx Global Robotics & Artificial Intelligence Thematic Index jumped more than 48% in 2017. That type of performance is enough to seduce many investors, but that same benchmark slipped 7.60% in February, generating monthly volatility of 34.10%.2 Said another way, that robotics and AI index's February slide was more than triple the loss experienced by DTEC during the month.
While it probably is not accurate to call the indexes devoted to individual disruptive themes “old,” many use old school weighting methodologies. For example, the two largest components in the ISE Cloud Computing Index are Netflix, Inc. (NFLX) and Amazon.com Inc. (AMZN). Only two members of the S&P 500 have larger market values than Amazon while Netflix currently has a larger market cap than Wal-Mart (WMT) and McDonald's (MCD).
Holdings subject ot change as of 12/31/17
For its part, DTEC not only equally weights its 10 disruptive themes, but its 100 components as well, potentially reducing single stock risk in the process. As the chart below confirms, equally weighting stocks is rewarding across sectors and market capitalization segments.
Past performance does not guarantee future results
Annualized returns for the past 10 years show seven of the 11 S&P 500 sectors, when equally weighted, outperform cap-weighted equivalents, according to S&P. Three of those seven sectors – financial services, healthcare and technology – are prominent parts of DTEC's roster.
1 Source: Nasdaq Dec. 28, 2015 https://www.nasdaq.com/article/what-thematic-investing-is-and-its-strengths-and-risks-cm559209
2 Source: ETF Replay data
An investor should consider the investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus which contain this and other information call 866.675.2639 or visit www.alpsfunds.com. Read the prospectus carefully before investing.
An investment in the ALPS Disruptive Technologies ETF (DTEC) may be subject to substantially greater risk and volatility than investments in larger and more mature technology companies.
There is no assurance that the market developments and sector growth based upon the themes discussed in the article will come to pass.
ALPS Disruptive Technologies ETF shares are not individually redeemable. Investors buy and sell shares of the ALPS Disruptive Technologies ETF on a secondary market. Only market makers or “authorized participants” may trade directly with the Fund, typically in blocks of 50,000 shares.
ALPS Advisors, Inc. (AAI) has engaged IRIS Werks, LLC (IRIS) to produce analysis and commentary on ALPS-advised ETFs. IRIS currently has a compensated business relationship with AAI. AAI is not affiliated with IRIS.
The content and opinions expressed in this article are that of the author and not the views and opinions of AAI. In addition, AAI assumes no responsibility to ensure the accuracy of the content written by the author.
There are risks involved with investing in ETFs including the loss of money. Additional information regarding the risks of this investment is available in the prospectus. Past Performance is not indicative of future results.
The fund is new and has limited operating history.
ALPS Portfolio Solutions Distributor, Inc. is the distributor for the ALPS Disruptive Technologies ETF. AAI is affiliated with ALPS Portfolio Solutions Distributor, Inc.
The author is not an investment professional and this article should not be considered investment advice. While the information and statistical data contained herein are based on sources believed to be reliable, the author takes no responsibility to ensure the accuracy of the content. Additionally, this article should not be relied on or be the basis for an investment decision. Information that is historical is not indicative of future results, and subject to change.
S&P 500®: A capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
S&P SmallCap 600®: A capitalization-weighted index that measures the small-cap segment of the U.S. equity market.
S&P MidCap 400®: A capitalization-weighted index that measures the mid-cap segment of the U.S. equity market.
Indxx Global Robotics & Artifical Intelligence Thematic Index: The Indxx Global Robotics & Artificial Intelligence Thematic Index is designed to track the performance of companies listed in developed markets that are expected to benefit from the increased adoption and utilization of robotics and Artificial Intelligence ("AI"), including companies involved in Industrial Robotics and Automation, Non-Industrial Robots, Artificial Intelligence and Unmanned Vehicles.
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