Viewpoint: corporate leadership in crisis

Citation

Smith, P. (2003), "Viewpoint: corporate leadership in crisis", Measuring Business Excellence, Vol. 7 No. 3. https://doi.org/10.1108/mbe.2003.26707cab.004

Viewpoint: corporate leadership in crisis

Peter Smith is CEO of The Leadership Alliance, Toronto, Canada, and divides his time between Canada, the UK and the USA in his leadership development work. See www.tlainc.com

Anyone trying to progress organizational change will surely have complained "The problem round here is a lack of leadership". In the collection of papers on leadership, The Leader of the Future, with contributions from more than 30 world-authorities on leadership, a somber view of leadership potential is advanced again and again. James Bolt's remarks are typical: "The dearth of leadership is apparent throughout society" and "At a time when leadership is more crucial than ever to our very survival, there is a severe shortage of people to lead corporations". In his forward to the book Peter Drucker says: "The lessons are unambiguous. The first is that there may be 'born leaders', but there are surely too few to depend on them".

Leaders for our current and future business climate need not be high charisma individuals who create followers through personal magnetism. They can be people who have developed the skills of thinking and acting "outside the box", who can confront and challenge old patterns, and spearhead new ones, at any level in the organization. The problem is that we seem to know how to develop managerial skills but not such leadership skills. This is not to say that leaders may not be good managers, but that leadership is something else again.

Drucker, Bennis and many other authorities have declared that the difference between leadership and management is that managers deal in efficiency and leaders in effectiveness, or, managers are satisfied when things go smoothly, and leaders are dissatisfied when things do not change for the better. We are in danger of having a "catch 22" situation: as the ratio of managers to leaders increases, there will be increasing resistance to change and the development of the leaders who call for it, leading to an ever deepening crisis in leadership and its development.

Where do leaders come from?

Drucker states firmly that leadership can and must be learned. But as those who actually try to implement learning in organizations know only too well, developmental learning can be a hard sell. In the aforementioned The Leader of the Future collection, James Bolt states that the leadership crisis is in reality a leadership development crisis. To be fair, many aspiring leaders have little time for traditional learning and formal development exercises. They are "too busy" with daily chores. Potential leaders are often the "work horses" of the organization. And in reality, if all such staff were spending their time learning, no work would get done. Many of those who say "I am too busy to learn", are speaking the truth as they see it.

So if learning really does hold the key to leadership development, how can we turn that key? Every year, fortunes are spent on management and leadership development efforts, yet organizations are littered with successful managers who fail when given leadership responsibility. How can that be?

We believe it is because being a senior executive depends on far more than acquiring technical knowledge and management concepts. It comes from a feel for factors such as organizational politics and culture, networking, the art of influencing others, the skills of timing and presentation, the knack of having and selling ideas. We believe it stems from a systemic on-the-job approach to leadership development.

In this sense, the accusation that traditional business schools fail those they are intended to serve is both an understatement and a misconception. A standard-format MBA, for example, cannot ever hope to create the subtleties outlined above, nor is it meant to be a degree in leadership. Executive MBAs are particularly deceptive since they target a leadership audience, but are capable of offering only further managerial insights.

How does learning relate to leadership development?

To understand why leadership development has been, in general, a failure, we need to dig deeper into learning itself. Learning is often divided into three levels: level 1 learning relates to "efficiency" or "doing things right"; level 2 relates to "effectiveness" or "doing the right things"; and level 3 relates to meta-learning or "making sure the learning processes themselves are optimal". Now from what has been said above, it is clear that level 1 learning is most suitable for management development, and level 2 learning for leadership development. Since level 1 learning takes place in a fixed business context where standards and norms are established, training is an appropriate delivery mechanism. However, since level 2 learning involves ambiguity, complexity, changing business contexts, and adaptation, learning takes place best in the work-place, if it is to take place at all.

We can only learn about leadership through practicing leadership, just as we can only learn how to ride a bicycle by riding a bicycle. Nothing else feels how it feels. No book can prepare a person for leading a team when there is only the foggiest notion of a heading, for asking the right questions rather than appearing to know the answers, or for plugging in to business happenings before they happen. In the end we can only learn about it by doing it. This "learning by doing" within a well-thought-through framework is the only way we can turn the leadership-development key and unlock the organization's leadership potential.

Six pointers for breaking out of the leadership crisis

1. 1.

   Leadership and management do not require the same competencies. Managers focus on operational efficiencies - doing things right within pre-set narrow or broad specifications, making sure things run smoothly, seeking incremental non-substantive improvements. Leaders focus on doing the right things - the thinking-through and determination of the specifications themselves; knowing where to make the specifications tight and where to make them loose; being hungry to change for the better, seeking substantive, quantum-leap improvement.

2. 2.

   Leadership competencies can only be gathered from experience. But whilst experience is the most powerful teacher we have, it usually does not work effectively alone. Leadership development must focus on both experience and learning.

3. 3.

   Leaders are an inescapable part of organizational success over the medium term. Unless leaders are in place to constantly prompt, question, challenge, decide, coach, encourage and take meaningful action, an organization will not sustain over anything but the short term. The care and nurturing of leaders, both those in place and those holding leadership potential, can hardly be overstated in importance.

4. 4.

   Leadership development requires a syllabus - composed around the current and future strategic challenges of the organization. It requires access to information resources which can be drawn down to prompt ideas and shed light on emerging problems. It requires careful design, support and coaching to maintain the sometimes delicate balance between the practice field and the reality of real decisions affecting real people in real time.

5. 5.

   The developmental methodology called action learning addresses many of these concerns. Only recently is a body of knowledge beginning to be codified which applies an action learning methodology to the challenge of leadership development.

6. 6.

   We would urge those in senior HRD and OD roles, and indeed those who currently lead organizations as CEOs, presidents and VPs, to carefully audit their current activities in leadership development. The challenges of nurturing leaders must neither be left to chance, nor to traditional developmental methodology. If the heirs apparent are not able to rule, or not able to be brought to positions of leadership, or defect to other firms - the organization's future health is at grave risk.

Further readingHasselbein, F., Goldsmith, M. and Beckhard, R. (Eds) (1996), The Leader of the Future, Jossey-Bass, San Francisco, CA.