Toxic Leadership

Certain leadership skills are appropriate at different stages in the leader’s career. For example, the ability to step back and see the “helicopter view” is not as useful to a first-line leader as a senior executive. It is essential to have the right leadership skills at the right time; otherwise what might ordinarily be considered as a “good” skill suddenly becomes inappropriate. Beyond inappropriate leadership skills, leaders might also exhibit “dark” behaviours (e.g. aggressive, arrogant, bullying etc.). Then we can have “toxic” leadership; but is this entirely the leader’s “fault” or is the root cause contextual?

According to Einarsen et al., toxic leadership destroys value and can manifest itself against the company (i.e. disloyal) or against the employees (i.e. tyrannical). Padilla, Hogan and Kaiser proposed that toxic leadership is actually a consequence of three interdependent forces and is not just a case of the leader behaving badly. Their theory (which appears in The Leadership Quarterly, 18, 2007, pp176-194) asserts that three forces have to be present in order to witness toxic (or “destructive”) leadership.Here’s a summary followed by further considerations (“et alors”).

Toxic Leadership

When all of the three forces are aligned and noted as below, then the leader can become destructive:

The leader...

·         Is charismatic but functions narcissistically (e.g. egotistical, intolerant of others, etc.)

·         Is motivated by personal power (individually or in the organisational context)

The followers...

·         Are insecure or “vulnerable” and need to be led

·         Are in agreement with the leader if they are ambitious

The environment...

·         Exhibits cultural preferences to avoid uncertainty

·         Exhibits instable “governance” and there might be a sense of “menace”

Et alors?

At first glance, the above is actually good news as it appears that just one of these forces needs to be removed to ensure that toxic leadership does not emerge; however, this is easier said than done! Moreover, it seems that unfortunately, none of the forces are stand-alone and can therefore not be singled-out or isolated. For example, even the high personal drive on behalf of the leader – the motivation for personal power – might be contextual. According to Herzberg, “satisfaction” motivators include achievement, recognition, the work itself, responsibility, advancement and growth. So why are some people more motivated by “power” (responsibility and advancement) rather than a sense of “development” (achievement and recognition)? The references can be cultural: both corporate and national.

In a hierarchical corporate culture where power is usually centralised and limited to the “top”, employees might be motivated to “advance” so that they can actually have some power. In cultures with a high “power distance”, there is (according to Hofstede) an acceptance and an expectation that power will be distributed unequally. At once and at the same time the “followers” need to be led and there might be a greater motivation on behalf of the “leader” to obtain that rare-but-significant power. Further, if the prevailing culture is one where uncertainty is ordinarily avoided then the leader can assume power by providing certainty (e.g. taking bold decisions).

So if bad leadership is principally contextual, what can be done to avoid it? Depending on cultural references, “followers’” who need to be led cannot always be changed; and in the wider context of the “environment” and again culturally, it is difficult to address (for example) uncertainty avoidance. It would appear that the only thing that can be changed is the leader. When a particular cultural context means that there is a higher risk that bad leadership might emerge, then even more attention has to be paid to developing leaders! In particular, timing is everything – leaders have to be equipped with the right leadership skills at the right time in their development so their leadership skills are, if not “good”, then at least appropriate!

Global Organisations

The Economist recently reported that “companies in developed countries do themselves nothing but harm if they fail to think globally” (Schumpeter, “Bumpkin bosses,” 10 May 2014). The focus of the article was that despite the global credentials of many organisations, the C-Suite executives tend to remain not only local but parochial in perspective; and as a consequence, opportunities are often lost (from emerging markets worth $20 trillion by 2020 according to McKinsey). Citing a study by Bain & Co, Western companies with subsidiaries in emerging markets increased their profits there by an average of 15%; however comparable companies from those emerging markets were increasing their profits in the same period by 23%. So what seems to be the problem?

Only 12% of the CEOs from Fortune 500 companies hail “from a country other than the one in which the company is headquartered.” Those companies that do have a “foreign” CEO tend to have up to 50% of senior managers who are also “foreign”; those that don’t have only 10% equivalent. The relative parochialism can “impose huge costs in terms of reduced creativity, missed opportunities and cultural blundering.” Worse, things look bleak for the future: it is becoming more difficult to recruit high potentials abroad who tend to look at these statistics and hence prefer to work for local companies; and simultaneously the proportion of expats overseas in the biggest multinationals in the biggest emerging markets is reducing (56% to only 12% in the 10 years to 2008). So, what to do?

Here’s what global organisations can do to make sure they really act global, along with further considerations (“et alors”):

Global Organisations

The Economist suggests three things an organisation should do to avoid the “evils” of parochialism:

Move Managerial Functions

By moving location, parochialism can be avoided. Proctor & Gamble relocated its global cosmetics and personal-care unit from Cincinnati to Singapore; General Electric moved its X-Ray business from Wisconsin to Beijing; and Schneider Electric moved its CEO from France to Hong Kong.

Move Managers to Headquarters

By increasing the proportion of “foreign” managers, parochialism can be reduced. The article refers to Bertelsmann as posting “successful local managers” to head office for a few years; and Daimler-Benz has “decreed that half the participants in its programmes for young high-flyers must come from outside Germany.”

Move Managers to Emerging Markets

By getting managers out to emerging markets, managers can become more cosmopolitan which will help the organisation be more multinational in outlook and behaviour. IBM and FedEx are cited as encouraging their executives to provide consulting services to emerging-world subsidiaries. 

Et alors

These are all good ideas and many multinational organisations already do all of the above; yet the corporation still might not be achieving its full global potential. It’s not what you do or where you do it, it’s also how you do it. Many “international” organisations with one principle headquarter tend to be “ethnocentric” in nature, viz: “centred on the culture of origin of the enterprise (head office) which keeps all the principal authority (centre of decisions) and distributes its values to the entirety of Group subsidiaries. Communication is principally by instruction from the head office to the subsidiaries and head-office management occupy key posts in the subsidiaries.” (O. Meier (2008, 3rd ed.), “Management Interculturel. Strategie, Organisation, Performance.”)

Moving managers out from head office to emerging markets can actually maintain the parochialism; as can moving foreign talent to head office and then simply returning them to their country of origin. To defeat parochialism and to truly benefit from being global, managers should not be thinking of a career centred on any one particular head office: instead all talent should be moved in all directions. If your head office is in the USA and there are worldwide subsidiaries including (say) China, the organisation needs to think beyond just sending Americans to China and vice versa; instead the Americans might go to China and then somewhere else – likewise the Chinese might go somewhere else first without passing by head office and or keep on rotating. Only then will the company start to be truly global both in outlook and behaviour!

Managing Multicultural Teams

“Today, success depends on the ability to navigate the wild variations in the ways people from different societies think, lead and get things done. By sidestepping common stereotypes and learning to decode the behaviour of other cultures […] we can avoid giving (and taking!) offense and better capitalize on the strengths of increased diversity.” This from Erin Meyer of INSEAD in her article in the May 2014 edition of the Harvard Business Review: “Navigating the Cultural Minefield.” Besides highlighting various cultural “scales” which can assist the decoding of other cultures, she also highlights four rules for managing across cultural differences which can help capitalize on the strengths of diversity.

Here’s how to manage multicultural teams along with further considerations:

Managing Multicultural Teams

Focusing on leading as one of the cultural scales (from “egalitarian” to “hierarchical”) the author prescribes four “rules” for managing across culture in a multicultural team:

1.       Don’t underestimate the challenge

As management styles “stem from habits developed over a lifetime” they can be hard to change: both yours and that of your team! Starting with yourself, you may need to “unlearn” your own style when moving to a new culture and/or managing a new multicultural team.

2.       Apply multiple perspectives

If you are leading a team of various different cultures, “it isn’t enough to recognize how your culture perceives each of the others.” In addition, you need to understand how each different culture perceives each other culture in the team!

3.       Find the positive in other approaches

This is the very essence of managing multicultural teams. If all you have is a negative view of other cultures, managing a multicultural team is going to be very difficult! Accentuate the positive to capitalize on the differences in the team.

4.       Continually adjust your position

Practice makes perfect. If you consider management as a one-to-one relationship with each team-member, then consider which management style might be the most effective in each instance, and keep adapting even if that means going back to “square one”.

Et alors

Unfortunately and all too often, some managers expect everyone else to adapt to their style and make no effort to accommodate their team! This is can be found in more “ethnocentric” cultures (where the group considers their culture to be the primary point of reference). Similarly, this article is focused on expatriate managers – managers who are already adapting by moving overseas and then having the challenge of managing a multicultural team; however one of the issues for multicultural companies is when the manager (usually at head office) is “local” and has a multicultural team (of expatriates). Whilst the team might be busy adapting, it is often the case that the manager makes little or no effort to do the same. When that is the case, it very unlikely that the team will be able to collectively capitalize on their cultural diversity – steps 2 to 4 will be impossible to achieve without step 1 from the manager! This highlights the point that multicultural awareness and training should not only be for managers going on assignment overseas but also for any manager in a multinational group who might be welcoming multicultural staff into the team!

Managing Worry

Articles written in the “business” press about “how to” cope with stress tend to be split into two general categories: one type focuses on the physical effects of stress – how there is good stress and bad stress, but to ensure you get the correct balance you need to eat well, avoid toxins (alcohol, tobacco etc), exercise more and sleep well; and the other type tends to focus on the psychological aspects of stress – how you think and feel, what your interpersonal relationships are like, the context of your work environment etc, with the general message that greater awareness leads to greater control (and therefore less stress). Instead of “how to” deal with stress, what about the causes of stress? They are often overlooked and so I was pleased to see in the HBR “Pocket Mentor” series a chapter about managing worry – a major cause of stress (Hallowell, “Managing Stress – Expert Solutions to Everyday Challenges”, 2007).

 

Here’s how to manage worry (and therefore reduce stress) along with further implications (“et alors”).

 

Managing Worry

 

Worry is a major source of stress but according to the author, it can be easily overcome using a simple three-step plan. Whenever you start worrying about something:

 

Evaluate

 

Don’t ignore the worry; rather confront it and in particular, name it!  By defining the problem, you can already start to “put it in perspective” and reduce the worry!

 

Next, you need to think constructively about the problem. Challenge your assumptions – have you taken any shortcuts in your diagnosis? Correct errors in logic (talk it through with someone) and develop alternative hypotheses.

 

Plan

 

Replace toxic worry with “effective action”. The idea here is that worrying is only negative – replacing that with “doing something about it” (if possible) will help; but to do so, you need to plan!

 

Wise worry leads to fact gathering; toxic worry just “exaggerates and misrepresents reality.” Make a plan to address your worries; but also make sure you have structure in your personal organisation: according to the author, “anti-anxiety agents” include lists, reminders, schedules and agendas!

 

Remediate

 

There are only two key options here. Either, having isolated your worry and having taken steps to gather facts, you can now take direct action: change (yourself), connect or confront (others).

 

Or, “let it go”! Sometimes, your analysis of the worry will lead you to the conclusion that it is not worth time worrying about. If the matter is beyond your control or influence, you have to let the worry go. “Blow it away and start a new project, read a different book, walk another path…”

 

Et alors

 

The “evaluate” stage is critical and there is some good advice here: if the worry (and/or anxiety) is so strong that you are not thinking straight, you actually need to take time to think straight! Putting things in perspective can be achieved by both focusing and brainstorming to see exactly what the worry is. All well and good; however what about “planning” and “remediating”? Firstly, the “remediation” step might be best considered in conjunction with the “evaluation” step – from the outset it would be wise to consider what aspects of the “worry” you can influence or control and accordingly focus where you can actually have an impact. “Planning” might be described an “analyzing” in this context – a thorough review of the facts and context can probably help in any worrisome situation.

 

From a cultural point of view, the author appears to suggest steps which might work well for Americans in America, but perhaps not for everyone else anywhere else. Planning can cause as much stress to some people as worrying: some personality types and some cultures prefer to “live in the moment” and “go with the flow” (without any recourse to planning). Similarly, the call to “action” might be readily embraced by persons and cultures that have a preference for “extroversion” rather than “introversion” (with the associated inward-focused contemplation and reflection). Finally, the perspective seems to be very “individualistic” with the one person taking control not only for themselves but for the environment around them – perhaps not the starting point for a more “collectivist” culture. Anyway, not to worry!

High-Performance Teams

Katzenbach and Smith in “The Wisdom of Teams: Creating the High-Performance Organisation,” (1993, McKinsey) suggest that organisational high performance can only be achieved through high-performance teams. If the organisation remains simply a collection of individuals, the organisation will never achieve its maximum potential. Their research revealed interesting insight into what makes a team a high-performance team.

Here’s what makes a team’s performance “high” followed by further implications (“et alors”).

High-Performance Teams

The authors’ research into team performance led to five “common sense” findings that made a significant difference in team performance:

A demanding performance challenge tends to create a team

- A “hunger” for performance is more important that team-building exercises.
- A team will fail to become a high-performance team without a genuine challenge.

The disciplined application of “team basics” is often overlooked.

- Team basics include size, purpose, goals, skills, approach and accountability
- High-performance requires all of the basics to be in place.

Team performance opportunities exist in all parts of the organisation

- Team basics apply to all different groups e.g. task forces, work groups, management teams.
- Despite differences, all high-performance teams share the same commonalities.

Teams at the top are the most difficult.

- Complexities, long-term challenges, and time pressure reduce senior team performance.
- Senior teams that do achieve high-performance tend to have fewer members.

Most organisations intrinsically prefer individual over group accountability.

- Job descriptions, pay, careers and performance evaluations focus on individuals
-  High-performance teams emphasise group accountability.

 

Et alors

These are the “common sense” findings about high-performance teams and indeed they do appear to be intuitive: get the basics defined, have a clear challenge and agree to be collectively accountable, then you should be on track. Leaders should take note that the authors found that “team leaders are best distinguished by their attitude and what they do not do” – focusing on team building for example is not always a route to high-performance.  Finally, one of the key “uncommon sense” findings is also worth noting here: high-performance teams “learn.” "By translating longer-term purposes into definable performance goals and then developing the skills needed to meet those goals, learning not only occurs in teams but endures…”

Business Model Generation

It is unlikely that the competitive advantage of any business will last forever. Accordingly, you need to know exactly how your business is positioned and how it fits with the context and environment. In order to facilitate such a regular strategic review, there is a very good business model “generator” which has been developed through collaborative efforts and published in a book called “Business Model Generation” by Alexander Osterwalder and Yves Pigneur (John Wiley & Sons, 2010). It gives a brilliantly concise overview of a business so that you can build your own model to see where and how you are adding value; and in so doing consider where you might need to best focus your efforts, both now and in the future.

Here’s the business model generator along with further considerations below (“et alors”)

Business Model Generation

As illustrated below, the pro-forma is in 9 parts surrounding the key “value proposition”. On the right is the customer whose interface with the value proposition is the “customer relationships” and the “channels”. These are related to the revenue streams. On the left are the “key partners” who are connected to the value proposition through “key activities” and “key resources”. These are related to the cost structure.

Key Partners	Key Activities	Value Proposition		Customer Relationships	Customer Segments
	Key Resources			Channels
Cost Structure			Revenue Streams

Here’s the various sections in detail:

Value proposition

This is why customers come to you. Create value by inventing something new; improve your product’s “performance”; or “differentiate” your offer to specific needs.

Customer segments

This is all about positioning. “Mass” markets and “niche” markets require different approaches, while “segmented” customer bases share similarities, but with differing needs.

Channels

Select the best “customer touch points” to communicate value and to distribute and sell your products and services. What is the channel e.g. internet, B2B2C, B2G, wholesale…?

Customer relationships

Establish different ways to serve distinct market segments: is the focus on mass produced commodities or on personalized service?

Revenue streams

Capturing income, each type of revenue stream may demand a different “pricing mechanism,” either a “fixed” price or a “dynamic,” negotiated price.

Key partnerships

Consider supplier links, “coopetition”, joint ventures and “strategic alliances”; along with outsourcing and subcontracting.

Key resources

Assets are “physical, financial, intellectual or human” depending on what the business is. Remember that key resources may be “owned or leased”.

Key activities

What do you actually do to capture the profit? Produce an item, provide services/solutions, manage processes?

Cost structure

“Cost-driven” or “value-driven”?  Outlays represent “fixed and variable” expenses. Consider economies of scale and “scope” from large-scale production and distribution.

Et alors

The idea is that using this template you can see where your business model adds value and also where it might not add value. Such a review applied to a private banking business might (for example) highlight that customer relationships are the most “value added” part of the value proposition which therefore need to be focused on; whereas operations could be outsourced.

The model can also be used to compare your business to that of competitors to see where there might be an opportunity or a threat. It might also assist a review of the possible temporary nature of your current “value-add”. This might highlight other parts of your business that could add value in future or even right now (eg. UPS with their offer to manage other companies’ logistics).

The key is as the authors say “virtually all business models eventually become obsolete, so proactive companies actively conceive and pursue new models. One side benefit of continual business-model design and redesign is a healthy lack of respect for long-held assumptions.” Each of the 9 sections of your business model is subject to continual repair and renewal! Keep reviewing!

HR Management for Leaders

Developing talent is one of the most important things a leader needs to do; however there is a general myth in lots of large organizations that all matters relating to HR management are taken care of by the HR department. So where do you draw the line? What should the leader do and what should the leader leave to the HR department? Without going into the finer details of everything that might be in the scope of work for an HR professional, Peter Cappelli addresses this question in an article entitled “HR for Neophytes” (Harvard Business Review, October 2013). In particular he focuses on five questions leaders might ask regarding HR management in order to help develop talent.

Here’s a summary of HR Management for Leaders followed by further reflections (et alors):

HR Management for Leaders

Whilst the following five “emerging best practices” may be very familiar to HR professionals, not all leaders are aware of them. The five points can be considered as follows:

1.       What are our talent needs?

Performance problems do not spring from individual failure. Research indicates that the quality of peoples’ work depends “in a large part on context, including the systems and support around them.”

Put the employees in the right job with the right boss (including moving them away from you if you are not right for them). Provide the necessary systems and support!

2.       How should we meet our talent needs?

Buy, borrow or build. Buying might be costly and bypassing internal candidates may demotivate others. Borrowing (contractors or secondees) is mainly a short term solution.

The ‘essence’ of talent development is building talent for the long-term. It enormously improves employee engagement and if they leave they will leave on good terms and might come back later!

3.       How can we do a better job of hiring?

Leaders are often delighted by a high number of applications for a post; but actually less is more. Target a small pool of high-quality applicants by listing very stringent requirements for the job.

Unless you are hiring a lot, leave the process to someone else. This is a part of talent development that is best handed back to the HR professionals.

4.       How can we develop internal talent?

Learning by doing is what the leader can best provide for the talent. Otherwise known as “on the job training,” this focuses on exposure and experience (rather than education).

Whilst increasing your workload today, investing long-term in your talent will “limit the number the employees who are disengaged because they don’t see those jobs as leading to a better future.”

5.       How can we manage employees’ career paths?

The internal offer has to be better than the external offer and this comes down to opportunities. As a leader you both create and find opportunities for talent both in- and outside your team.

This is where leadership and talent development come together: focusing on future growth rather than current performance, accelerating innovation, and managing change all lead to opportunities.

Et alors

The administrative part of HR should be left to the professionals (compensation and benefits, payroll, union relations etc); however in the other “half” of HR, “Learning and Development”, the leader has a very important role to play. Education (or “training”) can be taken care of by the HR professionals but otherwise talent needs to be developed by leaders and the above points are very succinct and concise way of focusing on development by experience and exposure.

Cappelli’s ideal hints at what is already anticipated with the arrival of the sense-of-purpose-focused, low-loyalty and project-driven “generation Y” in the workforce, namely that even “industrial” organisations will have to adopt the same development model as professional services companies. Those companies invest a lot of time in the development of their talent and yet they know that most of them will leave; however there are two key factors: 1/ Most of the development is “on the job” so there is not a lot of “lost” direct investment when talent does leave; and 2/ The only way to have good talent in the long term is to encourage them to leave but to do so on good terms and have the alumni both as ambassadors for the company and as potential “new-hires” for the future!

Leading Millenials

To lead, a leader needs to adapt to the followers and diversity comes in many forms, not least demographics. I was recently invited to assist at a seminar where the participants were all in their 20s which meant they were all “millenials” i.e. being persons born between 1977 and 1997 (also known as “generation Y”). When talking to the participants I realised that their hopes, expectations, motivations and drivers were entirely different to my generation (“generation X”). Wondering how a “baby boomer” (born before 1964) or “Xer” (born between 1964 and 1976) might lead the milenials brought me to an article by Meister and Willyard, “Mentoring Millenials”, HBR 2010. Besides giving guidance on “new” mentoring techniques to help develop millennials, the authors also researched and identified what millenials want.

Here’s how to lead millenials including further implications (“et alors”):

Leading Millenials

The authors identified three key areas where millenials typically have clear expectations: from their boss, from their company and regarding learning. As a leader in an organisation, if you understand these expectations you can better lead millenials…

Boss

Millenials expect that their boss will:

·         Help them navigate their career path

·         Give them straight feedback

·         Mentor and coach them

·         Sponsor them on formal  development programs

·         Be comfortable with flexible schedules

Company

Millenials expect that their company will:

·         Develop their skills for the future

·         Have “strong” values

·         Offer customisable options in remuneration

·         Get the work/life balance correct

·         Offer a clear career path

Learning

Millenials want to keep learning:

·         Technical skills in their area of expertise

·         Self-management and personal productivity

·         Leadership

·         Industry or functional knowledge

·         Creativity and innovation strategies

Et alors

This generation appears to be interested in continually learning and the millenials need to have a clear sense of purpose: they need to “connect” with their organisation and it is the leader who is going to make this happen (explaining the sense of purpose and leading with values). The millenials might not yet realise it, but they need to be led: their expectations of their boss are that the boss is a leader rather than just a manager; their expectations of their company are that it can support and develop them, something in fact that the leader (rather than just the organisation) does; and in terms of learning, typically they might approach this with more enthusiasm than other generations, but they again want to be led through structured programs. Engage, support and direct – that seems to be how leaders of today need to adapt to the millenials.

Minimising decision-making biases

Managers like to think that the decisions they make are objective and rational and have been executed taking into consideration all the pertinent facts. In reality, many other forces come into play when making a decision such that most decisions are usually subjective, irrational and have been made with only limited information. As Wolf explains in his HBR blog post of September 2012, “How to minimise your biases when making decisions”, it is mainly inherent biases which cause decisions to be sub-optimal. Accordingly, in order to optimise decisions, biases have to be recognised and then minimised.
 

Here’s a summary of decision-making biases and how to overcome them followed by further considerations (et alors).

Minimising decision-making biases

Drawing on studies from Rosenzweig, Kahneman and Schoemaker, there are six principle decision-making biases noted as follows:
 

Anchoring

If expecting the same outcome as before, contradictory data tends to be ignored or omitted. This becomes more acute with numbers which are difficult to “adjust away” from.

·         To overcome anchoring, “seek diverse outside opinion to counter overconfidence”.

Framing

How a situation is presented affects the decision. In addition and generally, the pain of losing is perceived to be more powerful than the pleasure of winning.

·         To overcome framing, inverse the perspective from positive to negative or vice versa.

Availability Heuristic

Vivid and easily imaginable events (even if uncommon) along with recent events are weighted disproportionately higher than unimaginable or past events.

·         To overcome availability heuristic, “search relentlessly for potentially relevant or disconfirming evidence”.

Confirmation Bias

Initial decisions become self-fulfilling prophecies. Data is collected after the event to justify the decision (similar to anchoring).

·         To overcome confirmation bias, accept a “chief contrarian” as part of the team.

Commitment Escalation

It is difficult to accept “failure” and start again from scratch; instead, previous commitments tend to influence current decisions.

·         To overcome commitment escalation, ignore the old problem by clearly redefining the new problem.

Hindsight Bias

Once something is known, it is difficult to remember when it was not known. This can make it more difficult to learn from failures (as it is now “obvious”).

·         To overcome hindsight bias, reward due process (and in particular “lessons learnt”) rather than penalising failure.

Et alors

How many organisations do not penalise failure in one way or another? The above decision-making biases are compiled at the individual level but despite the best efforts of any individual, decision-making biases can easily become “institutionalised” in an organisation. All of the biases noted above can reinforce organisational culture: for example, it would be a very brave individual who could go to the board of Kodak in the early 1990s and tell them that photographic film was doomed and they should start preparing for an exit (yet look what happened)! On a collective basis, a lot of the biases could be compiled into one key tenet, namely “groupthink”. On the other side, the one concept which seems to appear as the solution on a collective level is “diversity”! To optimise the decision-making process and overcome decision-making biases, make sure the team making the decision is diverse! The process might seem to be more "painful" but the end-result should be a higher quality decision!

Senior Leader Engagement

"The Many Contexts of Employee Engagement: a 2012/2013 Kenexa® Worktrends^TM report” published this week had some interesting results regarding senior leader engagement. 33,000 employees in 28 countries were asked 200 questions about employee, manager and leadership behaviours relating to employee engagement. Questions regarding pride, satisfaction, advocacy and commitment were posed in order to measure the extent to which employees “are motivated to contribute to organisational success, and are willing to apply discretionary effort to accomplishing tasks important to the achievement of organisational goals.”

Worldwide, regardless of industry or location, executives and senior leaders are the most engaged (at 76%) compared to any other category of employee (mid-level managers, 58%; supervisors, 53%; and individual contributors, 49%). What is interesting is that whilst this group is the most engaged, that engagement might not automatically trickle down the organisation (as demonstrated in the figures). Engagement does not beget engagement; rather trust appears to be the medium by which senior leaders can transmit engagement downwards in the organisation. The key finding of the survey was that “untrustworthy senior leaders will cause doubt and dampen employee engagement.”

Here’s the impact of senior leaders’ trustworthiness on employee engagement followed by further considerations (“et alors”):

Senior Leader Engagement

Senior leaders’ trustworthiness was measured compared to three core determinants of person-to-person trust and then the specific responses to those items were correlated to the overall employee engagement index (EEI) score. The trustworthiness and results are as follows:

1.       Benevolence

The senior leader shows concern for the well-being and morale of the employees.

Where positive, the EEI score averaged 79%; where negative, the EEI averaged 26%

2.       Competence

The senior leader has the ability to deal with challenges faced by the organisation.

Where positive, the EEI score averaged 69%; where negative, the EEI averaged 23%

3.       Integrity

When the senior leader says something, the employees can believe that it is true.

Where positive, the EEI score averaged 78%; where negative, the EEI averaged 26%

The report concludes that, “the effect of untrustworthy senior leadership is devastating on employees’ engagement. Employees seem particularly troubled by senior leaders who do not exude competence and know-how (EEI 23%). On the other hand, senior leaders who seem to genuinely care about their employees’ welfare cause workers’ EEI scores to soar (79%).

Et alors

Perhaps the issue is the difference in expectations between the senior leaders and the employees. If the senior leaders are principally “baby boomers” then the survey shows that their main “axis” of engagement is commitment; whereas generations “X” and “Y” both express their engagement through pride, satisfaction and advocacy (but not commitment). Other demographics might be at play, not least nationality with (for example) Indians being, on average, highly engaged (77%) and French showing overall low engagement (45%) – differences which could present challenges for senior leader engagement in multinational organisations.

Difference in expectations may influence all three trustworthiness factors. For example senior leaders may think they are being benevolent and showing concern for the well-being of staff when they sponsor, protect, coach or otherwise develop particular staff; however whilst this might suffice for a mid-level leader, the whole organisation will look to the senior leader for benevolence. By focusing on only a select few, the senior leader is actually excluding the majority, thereby damaging employee engagement by being seen as untrustworthy.

Senior leaders might take pride in being experts who are able to deal with the technical intricacies of a complex business. Further, they might expect that their staff see them as competent and able to deal with any of the challenges faced. But what if the staff are looking to the senior leaders to be competent in “soft” skills? What if the staff are hoping that the senior leaders can take the organisation through the necessary changes and lead them through uncertain times? Failing that and despite any technical expertise, the senior leader is actually seen as incompetent, thereby damaging employee engagement by being seen as untrustworthy.

When it comes to integrity, the senior leaders may well believe that they are telling the truth; but with all the best intentions, the senior leaders might live in a slightly-removed world where reference is constantly made to how things should happen rather than facing the down-to-earth reality of how things actually happen. Beliefs mix with myths which are not always connected to the constantly changing reality. At a given moment, the disconnect can become so large that the senior leader appears to lack integrity, thereby damaging employee engagement by being seen as untrustworthy. As the report clearly highlights, senior leaders must be able to maintain and grow trust if they wish to increase employee engagement!

Management is not Leadership

The difference between management and leadership is often overlooked and rarely clarified. In the press, “leadership” can be presented as a headline subject in itself, especially in the business news where journalists can be found asking “what is (or what went) wrong” with a particular company? However, in attempting to reply to that question, the analysis is often a consideration of management (rather than leadership). The professor who wrote a book which reviewed the differences between the two (“What Leaders Really Do”, 1999) was recently interviewed along those same lines by the BBC. Following that interview, Prof. J Kotter commented further as to why to consider the two the same is a mistake: Harvard Business Review blog post, “Management is (Still) Not Leadership”, 9.1.13 (accessed 13.2.13).

Here’s a summary of why it is a mistake to consider management and leadership the same followed by further implications (“et alors”).

Management is not Leadership

Kotter asserts that the confusion between the two is “massive, and that misunderstanding gets in the way of any reasonable discussion about how to build a company, position it for success and win in the twenty-first century.” There are three principle mistakes.

Mistake #1: presumed synonymy

The two words are not synonymous. To use them “interchangeably” underlines the key problem that the crucial difference between the “vital functions that each role plays” is not understood…

…in fact, whilst management can be mainly associated with planning, staffing and controlling, leadership is about vision, empowerment and producing useful change.

Mistake #2: leadership is only at the “top”

“Leadership” is used to refer to the people at the very top of hierarchies; lower layers are management; and then the rest are workers. This is very misleading…

… in fact, in an ever-faster-moving world, leadership is increasingly needed from people from all parts of the hierarchy. To consider leadership only at the top is a “recipe for failure”.

Mistake #3: leadership is about charisma

People often associate leadership with charisma and further that since few people have great charisma “few people can provide leadership, which gets us into increasing trouble…”

… in fact, “leadership is not about attributes, it’s about behavior”. In particular, leadership is associated with finding opportunities and successfully exploiting those opportunities.

Et alors

As here and elsewhere, Kotter highlights that a lot of organizations are “over-managed and under-led”; however his message is not that management should be replaced by leadership – instead he states that good organizations need both “superb” management and “superb” leadership. Complex organizations can be made both reliable and efficient by “management” but should also be taken into the future ahead of the competition by collective “leadership” through constant change.  If however "leadership" and "management" are mistakenly considered the same, then every time an organization needs more leadership all that will happen is that it will only “work harder to manage”…

Effective Leadership

The famous maxim that whilst “managers do things right, leaders do the right thing” was coined by Peter Drucker. His extensive research into leadership led him to assert that leadership is not about personality or innate talent: the best leaders “were all over the map in terms of their personalities, attitudes, values, strengths and weaknesses.” So what is it that makes leaders effective? In his 2004 article “What makes an effective executive?” HBR (reprint R0406C), he answers that what made all these different and diverse leaders effective was that they all “followed the same eight practices.”

Here’s a summary of what makes an effective leader followed by further considerations (“et alors”).

Effective Leadership

Drucker’s eight practices for effective leadership follow a process of obtaining the relevant knowledge (first two); converting that knowledge into effective action (next four); and finally ensuring everyone involved in that “action” feels responsible and accountable (last two).

Ask what needs to be done

Not necessarily what you want to do, but what must be done for the good of the organisation? This is a continual dynamic with review and reset, focusing on one task at a time.

Ask what is right for the business

Do not “agonise” over what’s best for a particular stakeholder (owners, investors, employees or customers): decisions that are “right for the organisation are ultimately right for all stakeholders.”

Develop action plans

Specify desired results, identify constraints (in particular, ensure the plan is in line with the organisation’s strategy), devise controls and continually review according to new opportunities.

Take responsibility for decisions

Ensure each decision taken specifies who is accountable and by when. Further consider who will be affected and who needs to be informed. Regularly review decisions in order to adapt accordingly.

Take responsibility for communicating

Get input on your action plans from superiors, subordinates and peers letting them know what information you need to succeed. Furnish them with the information they need.

Focus on opportunities, not problems

Results come from opportunities, not problems. Review how changes inside and outside the organisation (technology, innovations, markets) can be positively exploited.

Run productive meetings

Articulate each meeting’s purpose and terminate each meeting once that purpose is accomplished: follow-up with short summaries spelling out assignments and deadlines.

Think and say “We” not “I”

Any given authority will come from the organisation itself so reflect it by referring to “we”. Always consider the organisation’s needs and opportunities before your own.

Et alors?

Succinct, precise and yet all-encompassing, these eight practices really do look like a check-list that can be immediately applied by anyone aspiring to be an effective leader. Drucker further asserts that effectiveness is a discipline and can therefore “be learned.” Some of the practices have developed further e.g. most managers define action plans to be SMART (specific, measurable, achievable, realistic and timely); however Drucker also insists on strategic alignment if the leader is going to be effective in terms of maximising the team’s and therefore ultimately the organisation’s performance. He also alludes to the greater good rather than pursuing individual ambitions and constantly refers to monitoring and adapting to change. This context of “doing the right thing” is what sets these practices apart to really define them as the essential standard for effective leadership.

Management Roles

In talking about leadership it is often overlooked that management is just as important. Kotter states that leadership is about coping with change whereas management is about coping with complexity; however they are not mutually exclusive and too much leadership without good management can be just as detrimental to team performance as too much management without any leadership. In this context I sought the original and seminal work on management by Mintzberg, “The Manager’s job: Folklore and Fact”, HBR reprint 90210, August 1975. Whilst debunking the principal myth that management is about planning, organizing, coordinating and control, Mintzberg’s research led to an identification of the key roles of management.

Here’s a summary followed by further implications (“et alors”).

Management Roles

After studying how managers work, Mintzberg concluded that within the context of formal authority in which to act, managers have ten key roles which are organized in three main categories, viz:

Interpersonal Roles

The manger has to be a figurehead performing ceremonial duties. As a leader, the manager has to be responsible for the unit and should motivate and encourage others. The manager is also the key liaison with contacts outside the vertical chain of command.

Informational Roles

The manager is a monitor, scanning the environment for information and quizzing liaison contacts. As a disseminator of information, the manager passes on information to subordinates. As a spokesperson the manager provides information to those outside the organization.

Decisional Roles

The manager should be an entrepreneur continually seeking to improve the unit. As a disturbance handler, the manager responds to external forces. As a resource allocator the manager takes critical decisions and as a negotiator, the manager commits resources.

Et alors?

Unfortunately this is not an à la carte menu: according to Mintzberg, the ten roles form an integrated whole. In other words, you cannot be a successful manager and skip one of the roles! However, with self-reflection a manager should be able to identify any necessary development points. One of the common retorts of any manager is that they do not have sufficient time to cover all the roles; however the author notes that the more senior the manager, the less apparent control they appear to have over their time, yet they seem to cover all the roles! There are two insights as to how this is achieved: 1. Turn imposed obligations into opportunities (e.g. a speech is a chance to lobby a cause); and 2. Turn initiatives into imposable obligations – free time is made, not found!

This article was written in 1975 – a long time before the start of the debate regarding the definitions of leadership and management. What is therefore interesting to note is Mintzberg’s 15 year follow-up on the research (“HBR on Leadership”, 1990). Therein, besides the roles, he also talks about the “insightful” and “cerebral” faces of management. The former “face” is mentioned in reference to intimacy, humanity and personal experience whereas the latter is related to rationality, professionalism, and impersonal objectives. Mintzberg had noted in his further research that as organizations grow, they tend to become more “cerebral”; whereas employees appear to be most engaged with “insightful” managers who connect on a personal level. If you consider the latter to conform to the modern-day definition of a “leader”, then the “insightful / cerebral” management dilemma could therefore be interpreted as one of the very first debates on the definitions of leadership and management…