It is a common belief…maybe in this case an assumption…that effective leadership is key to organizations. Think of any number of great organizations like GE, Cisco, Google, etc. and you immediately think of great leaders. Yet, the research can’t make a connection. Most research has focused on the different leadership paradigms like differences of visionary and transactional leadership styles in organizations. For example, it has always been believed that visionary leaders played a larger role in organizations than transactional leaders…but because of research limitations the findings are not clear. One study by Fenwick Feng Jing and Gayle C. Avery of Macquarie University in Australia titled “Missing Links in Understanding the Relationship between Leadership and Organizational Performance” states the following:
“No clear picture has emerged about the relationship between leadership and organizational performance. Despite increased research into the leadership-performance relationship, many problems and gaps remain in existing studies. There is a lack of integration concerning the relationship between leadership and performance, a narrow set of variables has been used in previous studies, and context and levels have been ignored. Therefore, there is a need for clarification.”
Another key challenge in linking leadership to organizational performance is the issue of performance measures itself. The same study by Jing and Avery states:
“One problem relates to the quality of performance measurement. When selecting the measurements of performance, previous researchers have employed either financial measurements or non-financial measurements, rather than employing both kinds of measures in order to enhance the validity of the research. They have neglected the interrelationship between financial performance and customer satisfaction and employee satisfaction. This provides a narrow measurement of performance that may not have appropriately evaluated the sought-after performance effects appropriately. Thus, both financial measurements and non-financial measurements of performance are essential in order to enhance research validity.”
The implications to the profession of Human Capital Management (HCM) and development are significant. If there is no academic research to directly correlate leadership styles to organizational performance, then there can be no linkage of leadership development programs to organizational performance. According to Bersin and associates 2009 High-Impact Leadership Development study, it assesses that leadership development is a $9.5 billion industry. That is a ton of cash to be spending on something and not know whether it is having the intended impact on the organization. Of course, many organizations make use of anecdotal evidence that leadership development is having the intended impact. One private sector organization uses the number of new $1 billion businesses generated by action learning projects (ALP) during its leadership development programs. But as Bradley Hall states in his book “The New Human Capital Strategy,” our focus should not be on world-class leadership development programs, but world-class leadership capabilities. Because leadership capabilities should be driving organizational performance as we have seen…Even as I lead my organizations leadership development capabilities, I can’t tell you whether organizational performance is improving or even changing! Again…lots of assumptions and anecdotal evidence is being used across the HCM space in many respects.
I think it is important to understand the relationship, or in this case the potential lack of a relationship between leadership and organizational performance. Our organizations, and in particular, HCM leaders and their organizations should be engaging with the academic community to enable research that helps understand what we assume as a linkage between leadership and organizational performance. If we are unable to understand the linkage and the role that leadership development most obviously plays in our organizations…then we can’t leverage it to its full potential.
Twitter: JKeithDunbar Linkedin: http://www.linkedin.com/in/jkeithdunbar DNA of Human Capital: http://dna-of-humancapital.blogspot.com/
As most of you, I have had many different supervisors over the last 25+ years. During my time in the Navy, I got a new supervisor every 1-3 years because of rotations in and out of the organization. My experience during that time would be very similar to those of you reading today...it is fairly easy to segregate the great from the not-so-great leaders...that ratio is probably in some cases 1-to-100.
In my time as a Naval Intelligence officer, we had a tool that was called the "Alpha Roster." The Alpha Roster was something of a planning tool that listed all of the Naval Intelligence officers, their current command/unit, and when they were due to rotate to a new job. While its intended purpose was for career planning purposes...it also had another...it provided a way to track those not-so-great leaders to ensure you didn't end up even in the same geographic region with them again. In many respects, those these supervisors were in leadership positions...they were really my boss and not my leader.
How does this story relate to the topic? I think there is a significant difference between bosses and leaders...While your boss can be your leader...that doesn't happen nearly as often as your boss never being your leader.
There are a number of great perspectives on what makes great leaders standout from people that are playing your boss. The Faster TimesFred Wilson recently posted on "The Three Things CEOs Do." In the post a Venture Capitalist shares what CEOs do and importance on organizations...
"A CEO does only three things. Sets the overall vision and strategy of the company and communicates it to all stakeholders. Recruits, hires, and retains the very best talent for the company. Makes sure there is always enough cash in the bank."
While this seems simplistic, the first attribute is a critical component in differences between bosses and leaders. Rosalyn Carter, wife of former President Jimmy Carter, once shared her perspective on just the difference between leaders and great leaders.
“A leader takes people where they want to go. A great leader takes people where they don't necessarily want to go, but ought to be.”
This quote gets to the Venture Capitalist comments on what CEOs do...in this case great leaders have to set a vision of the future and get the organization and its culture to move to this new proposed future.
Bosses have their role to play...detail-oriented, efficiency focused, standards, risk management, and process driven (Let me clarify that this is my view of bosses). There are of course much more negative attributes of people I lump into the "boss" category that we have all seen and said to ourselves..."That is not the way to lead and I am not going to do that when I am a leader"...I focus on more of what I see from bosses. These "boss" attributes lead to results that can move organizations, teams, and individuals to new levels, but at the end of the day...these things do little to inspire or enhance employee engagement.
To be the great leader that Rosalyn Carter discusses...you have to create a future shared vision for the team and/or organization, communicate clearly and effectively, inspire trust and openness, create a culture of innovation and disruption and how the team working collaboratively can achieve results.
Great leaders with these abilities are talent magnets...drawing people to them and their organization because they see a new and potential future that this talent can play a part in creating...Like the Venture Capitalist discusses as the number two thing that CEOs do. This is why companies like Apple, Cisco and IBM draw great talent to their organizations.
So...as you sit around today contemplating this blog post...think to your past supervisors or your current set and ask the question...