The BaldrigePlus Newsletter
Issue 16, Tuesday May 2nd, 2000
Leadership
This is the age of the team. Heroic leadership is dead, right?
Wrong!
From old economy boardrooms to dotcom sweatshops, in the US and around the world, leadership has never been more important, and never been in such short supply. Whether you labour in a ten-person e-something incubator, or at the farther reaches of a FORTUNE 500 behemoth, and wherever you are in the food chain, leadership is something you need to understand and be working on.
Here’s a leadership dilemma to think about in the shower. Tom Peters spotted it years ago. The most successful organisations all have one thing in common – charismatic leaders. But they also often have empowered workers, and a strong team-focused culture. Leadership in those organisations is a contact sport.
And here’s another one. There have never been so many well-educated B-school graduates. Talent is not a problem. The Western economies are knee-deep in MBAs. So why is leadership a problem? Is it a problem? Harvard Professor John Kotter thinks so.
In an interview in The Linkage newsletter, published at www.linkageinc.com, Kotter claimed that a senior management which has learned the complicated, sophisticated skills associated with management – where ‘management’ is a series of processes to do with operational planning and budgeting, structuring and staffing, and problem solving – is, in a period of rapid change, no longer enough. Great managers maintain the current system, but they do not adjust to dodging bullets, new global opportunities and technological discontinuities. Leadership does this – by setting new directions; by clarifying and expressing a collective vision; by getting people to understand that and line up in the right directions; and by motivating them to make it happen despite sacrifices and difficulties.
“The main new thing that people in jobs of any significance need,” according to Kotter, “is better leadership skills. They need to be doing more leading and less managing. They need to stop their companies from being over managed and underled.”
OK, but why isn’t it possible to just manage through change, the Linkage interviewer asked. Why is ‘leadership’ so important?
Look at companies that handle big changes successfully, replied Kotter, and you’ll notice that what they do is quite complicated. They find a way to create a sense of urgency. They pull a team together that has enough power to make something happen. That team focuses on a sense of direction and a vision. They communicate that widely, not just to the management but all the way down. They try to empower people who want to act on that new vision, which usually means getting structural or people blockers out of their way.
This takes time, said Kotter, so the team also tries to score short-term wins that justify the changes. When those occur, they don't just celebrate and quit, they use the momentum to take the next, more difficult, steps. The dilemma is that if you try to change anything, to a large degree you have to change everything.
That process is about 70% leadership and 30% management. Sure, you have to manage change – keep it under control and to lock in short term-results – but the basic engine that drives change is leadership, at least in the most successful change processes that one finds in the last decade or so.
So what can an individual manager, regardless of the title or position, do to become more of a leader? First, said Kotter, clarify what leadership is. Second, be honest about any gaps between present skills and what it takes to provide significant leadership. Third, find opportunities – small, low-risk – to be a leader. Evaluate the results. If successful, carry on. If not, try to figure out why. Repeat that cycle, pausing, every once in a while, to reevaluate whether you are becoming a stronger leader against some rational perspective of what leadership is. When people do that over time, Said Kotter, they grow as leaders.
But the failure of leadership is not just over-management. It has a lot to do with how leaders are chosen. According to Ram Charan and Geoffrey Colvin in the April 17th issue of FORTUNE, many organisations choose the wrong leaders. It’s not just a case of the wrong look or a cultural misfit, either. Choosing wrong can cause great harm – in extremis, it can be terminal. Look at Westinghouse, they say, once toe to toe with GE. Now, after five wrong CEOs in a row, gone. Or Coca-Cola, which lost $4.4 billion in market cap during Douglas Ivester’s two years. You can argue about the fine print, but the message is clear – leadership is critical, and it’s increasingly done wrong, even at the highest levels, even in the smartest FORTUNE 500 companies.
Let’s go back to Kotter, who’s answer to ‘what can an individual do to become more of a leader’ began with ‘clarify what leadership is.’ So let’s clarify. What is ‘leadership’?
Who better to ask than Andrew Kakabadse, Professor of International Management Development, Chairman of the Human Resources Network, and Deputy-Director at Cranfield School of Management in the UK, Director of the Cranfield Centre for International Management Development, and Vice-Chancellor of the International Academy of Management.
In an interview with Spotlight newsletter editor Sarah Powell (www.mcb.co.uk/emrld/now/spotlight.htm), Prof K approached this subject elliptically, making the point first that we live in a supply-side economy. There are many more goods available than we need, and lots of options for every purchase decision, so we differentiate through brand rather than need, through perception rather than quality (because ‘quality’ is now no more than a commodity). The Prof’s point? Leadership and philosophy – the drivers of brand strength, beliefs and values – are what really matter. He doesn’t say so, but what he’s implying is that you can’t manage your way to a great brand and a compelling philosophy – that takes leadership.
OK, said the interviewer (I’m summarising), getting back to the nature of leadership. Can it be learned, or is it intuitive?
Prof K has done a survey - 8,000 organisations, 14 countries - which shows that leadership qualities are all learned. Forget about natural born leaders; forget the search consultants’ ideas about getting the right person for the right job and finding the personal qualities that 'fit.' Prof K says that’s a modern construct and not supported by the evidence “what really counts is learning, development and willingness to adapt.”
Are there differences in leadership style deriving from gender? As far as I am concerned, said the professor, the gender difference, like national cultural difference, is a nonsense. “… obviously there are differences between males and females, but the question is, as in the case of national cultures, what is the relevance within a structured corporate organization, be it private or public sector? We found no discernible gender differences”
“What we did find was a very wide range of abilities, particularly … the more senior roles, where you need individuals who have a versatility, a range of qualities, to handle all sorts of different contingencies. It made no difference whether leaders were men or women, or whether they were Chinese, British or French. The differentiator was tenure and one of the prime differentiators was how long they had been in the job and how long they had been in the organization … age and experience did play a role.”
“Using [our] measures of leadership performance, we found that those individuals who had a markedly outward-looking attitude … a market-oriented attitude, and who had been in their job and in the organization for a long time, and were mature in the sense that they really accepted the responsibilities of their own actions and developed their people, were by far the best leaders.
“The worst aspects of leadership came from younger managers, especially those who were well educated, and intellectually very bright. They tended to make the worst decisions because they turned strategic concerns into operational concerns. They want to make an impact within eighteen to twenty-four months before they move on – the business, the profitability looks good, but have they actually invested in the long-term effectiveness of the brand? The answer is no.”
Now, what about Tom Peters’ teamwork dilemma. How can great groups and great leaders co-exist? Let’s turn to another Spotlight interview, this time with Warren Bennis, distinguished professor of business administration and founding chairman of the Leadership Institute at the University of Southern California, adviser to four US presidents, author of over 2,000 articles and author or editor of 25 books, including the best selling ‘Leaders’ and ‘On becoming a leader,’ both translated into 21 languages. His most recent books, ‘Organizing genius: the secrets of creative collaboration’ (1997) and ‘Co-leaders’ (1999), focus on his major interests of leadership, change, great groups and powerful partnerships.
“There does seem to be a kind of a paradox between entrepreneurial, individual-centred, personal accountability and the team concept, says Prof Bennis, “but I don't think they're actually in conflict at all.”
Look, for example, at the ‘Hollywood Model.’ Groups of individuals come together to work on particular tasks, like making a movie. After the project is over the group dissolves. Being in a group doesn’t preclude a high degree of individual autonomy, and there there’s also a greater need for leadership to ensure teams purposes are achieved. It's a paradox, he says, “but I don't see it as a contradiction.”
You've emphasized the need for leaders to forge relationships to motivate teams, Sarah Powell asked, does this represent a social development in working? Like Kakabadse, Bennis took a step back before answering. Look at the nature of knowledge work, he said. There’s a shortage of very talented people … they’re at a premium, and can leave – with their key teams – tomorrow. So they really must be treated like volunteers.
“A relationship with these people is incredibly important because … these are people who really don't need to be driven or to be pushed … they want a place to work where they can deploy their talents … How they are dealt with, how they are treated is profoundly different … the leaders of these groups have to abandon their own egos to nurture the talents of the people working for them, who in many cases know far more than they do.“
“We live at a time when, overnight, corporations can find themselves sidelined by a new innovation, a new invention. So, with all the excitement, we are still living at an extraordinarily vulnerable time. What this means for leaders of the future is that there will be enormous demands on them in terms of having perspective, of being able to understand diversity in a way that they have never understood it before, of being able to deal with people working many more years of their lives … it is a time of great opportunity. But also, lurking there at the back of my mind, there is the conviction that there is a lot of vulnerability.”
So far so good? Let’s go to yet another Spotlight interview, this time with Dr Ivor Kenny, Senior Research Fellow at University College Dublin, director of Independent Newspapers and of the Kerry Group, chairman or member of various government boards and commissions, Director General of the Irish Management Institute from 1962 to 1983, Chancellor of the International Academy of Management from 1982 to 1987, and Research Professor of Political Economy at Trinity College Dublin. He has also acted as a consultant to the Governments of Canada, India and the United Kingdom.
Ivor Kenny has worked closely with some of the top Irish companies to explore how these organizations work, and what makes them successful. His most recent book, , focuses on in-depth studies of major Irish enterprises carried out over some 15 years. He is author of seven other books including a best-selling trilogy on leadership.
Interviewer Powell began by asking ‘In your book, Freedom and Order: Studies in Strategic Leadership, published in February 1999, you have said that the only people who carry out recommendations with any energy are the people who have made them. How can leaders share their vision?’
People in an organization need two things, Ivor Kenny replied; a strong hand on the tiller, and to be consulted, to be part of what's going on. “What you want is a leader who, above all, listens and crystallizes things, encourages consensus … through persuasion, and preferably through conviction [people] are brought around to seeing things in the same way.”
Is there evidence of a stronger tendency towards empowerment in organizations in recent years, asked Powell? Yes, Kenny replied, for two reasons. First, educated and trained, self-motivated and mobile knowledge workers will simply leave for greener pastures If they find themselves in jobs where they are pushed around or cannot express themselves. Second, because of a more intrusive and sceptical media, there’s “a palpable decrease in deference and an increase in criticism. Leaders can't hide any more. People will either be empowered, empower themselves or leave.”
On that subject, what about the role of communication, Powell asked.
“Let me quote Abe Maslow, said Kenny, ‘There is a clear assumption in enlightened management that people need to know, that knowing is good for them, that the truth, the facts, and honesty tend to be curative, healing, to taste good, to be familiar …’
“The most consistent criticism of CEOs I have met with in my studies is that they were aloof, reluctant to get out and mix it with the troops, to listen and argue, even to change their minds occasionally, genuinely to share with their colleagues their vision of the future, the actions necessary to attain it - and the actions or behaviour that could inhibit or damage the organization and that could not be tolerated.
“We are living through an information revolution,” he continued, “It would be dissonant to have expectations in our civil life greatly at variance with what we can expect in organizational life. I believe you should never underestimate people's intelligence and never overestimate their information. One thing is sure. Where there is a vacuum of truth it will be filled by rumour, speculation and rubbish. The simple advice to all managers is, ‘Shut up and listen.’ One-way communication is an oxymoron.”
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