leadership ability is the lid that determines a person’s level of effectiveness. ! The lower an individual’s ability to lead, the lower the lid on his potential. ! The higher the individual’s ability to lead, the higher the lid on his potential. ! To give you an example, if your leadership rates at 8, then your effectiveness can never be greater than a 7… ! Your leadership ability – for better or worse – always determines your effectiveness and the potential impact of your organization.”

Let me tell you a story that illustrates the Law of the Lid. In 1937, two young brothers named Dick and Maurice opened a small drive-in restaurant in Pasadena, California, located just east of Glendale. Their tiny drive-in restaurant was a great success, and in 1940, they decided to move the operation to San Bernardino, a working-class boomtown fifty miles east of Los Angeles. Their business exploded. Annual sales reached $200,000.

In 1948, their intuition told them that times were changing, and they made modifications to their restaurant business. They streamlined everything. They reduced their menu and focused on selling hamburgers. They created what they called the Speedy Service System, in which their kitchen became like an assembly line, where each employee focused on service with speed. The brothers’ goal was to fill each customer’s order in thirty seconds or less. And they succeeded. By the mid-1950s, annual revenue hit $350,000, and by then, Dick and Maurice split net profits of about $100,000 each year.

Who were these brothers? Back in those days, you could have found out by driving to their small restaurant on the corner of Fourteenth and E Streets in San Bernardino, to see a neon sign that said simply MCDONALD’S HAMBURGERS. Dick and Maurice McDonald had hit the great American jackpot, but they never went any farther because their weak leadership put a lid on their ability to succeed.