Reshaping Leadership DNA Field Guide [1 ed.] 9781869222024, 9781869221874

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In Reshaping Leadership DNA, the authors managed to share their experiences in designing and implementing leadership development strategies, processes and practices. Here the focus is on the practical side of this challenging field. The authors simplify a complex human capital challenge, so that people and companies who know ‘what’ to do, now also have a guideline on ‘how’.

• Section 1 deals with defining and implementing leadership strategy in a practical manner; • Section 2, which deals with the theory, is a summary of Reshaping leadership DNA.

Focus areas: • Leadership as a strategic imperative • Defining leadership strategy and brand

If you have read all there is to read on leadership development and are still wondering how to implement such processes, this publication deserves to be on your desk.

• Leadership capacity identification and capacity building

About the authors

Letitia van der Merwe specialises in leadership development and assessment, and is interested in the challenges associated with leadership transitioning.

Anton Verwey is the Managing Director of Engage Leadership. In this capacity he focuses on leadership, executive assessment and development. He has extensive experience in the fields of business strategy, executive and leadership development, and talent management processes and systems.

• A leadership governance framework • Measuring benefit realisation.

Francois du Plessis is very experienced in a broad range of human capital, leadership assessment and organisational diagnostic interventions.

Anton Verwey • Letitia van der Merwe • Francois du Plessis

The book is divided into two sections:

RESHAPING LEADERSHIP DNA

Reshaping leadership DNA A Field Guide

RESHAPING LEADERSHIP

DNA Anton Verwey Letitia van der Merwe Francois du Plessis

 

A FIELD GUIDE Reshaping Leadership DNA.indd 1

6/13/12 1:05:28 PM

RESHAPING LEADERSHIP DNA

RESHAPING LEADERSHIP DNA

Field Guide

by Anton Verwey Letitia van der Merwe & Francois du Plessis

2012

Copyright © Knowres Publishing and Anton Verwey, Letitia van der Merwe and Francois du Plessis All reasonable steps have been taken to ensure that the contents of this book do not, directly or indirectly, infringe any existing copyright of any third person and, further, that all quotations or extracts taken from any other publication or work have been appropriately acknowledged and referenced. The publisher, editors and printers take no responsibility for any copyright infringement committed by an author of this work. Copyright subsists in this work. No part of this work may be reproduced in any form or by any means without the written consent of the publisher or the authors. While the publisher, editors and printers have taken all reasonable steps to ensure the accuracy of the contents of this work, they take no responsibility for any loss or damage suffered by any person as a result of that person relying on the information contained in this work. First published in 2012 ISBN: 978-1-86922-202-4 Ebook Published by Knowres Publishing (Pty) Ltd P O Box 3954 Randburg 2125 Republic of South Africa Tel: (011) 880-8540 Fax: (011) 880-8700/9829 E-mail: [email protected] Website: www.kr.co.za Printing and binding: Replika Press Pvt Ltd, Haryana, India Layout design: Cia Joubert, [email protected] Typesetting: Replika Press Pvt Ltd, Haryana, India Cover design: Sean Sequeira, idDigital, [email protected] Editing and proofreading: Elsa Crous, [email protected] Project management: Cia Joubert, [email protected] Index created with: TExtract, www.Texyz.com

Changes surrounding organisations are not mere trends, but are leading to an increasingly chaotic and complex world of work. These changes will have a profound impact on how organisations operate and individuals behave.

Foreword In this book, the authors share their experience in designing and implementing leadership development strategies, processes and practices. Whilst the backing of good science and research is clearly evident, the focus is very much on the practical side of this hugely challenging field. In this sense, the book attempts to simplify a complex human capital challenge, so that people and companies who know ‘what’ to do, now also have a guideline on ‘how’. Do the approach and toolsets work? In our case, progressing from the design to the implementation of a multilevel leadership development process took less than six months, using the approach shared here. If you have read all there is to read on leadership development and are still wondering how to implement such processes, this publication deserves to be on your desk, not only on your bookshelf. Mashumi Tutu | Group Manager: Learning and Development Pioneer Foods (PTY) Ltd

Table of contents About the authors___________________________________________ v Preface____________________________________________________ vi CHAPTER 1: LEADERSHIP AS A STRATEGIC IMPERATIVE� 1 Introduction����������������������������������������������� Does the quality of leadership really matter?������������������� The work of leaders����������������������������������������� Getting started��������������������������������������������� Leadership talent is the key������������������������������ It starts at the top��������������������������������������� A well-thought-through leadership strategy���������������� Using this book���������������������������������������������

1 2 3 5 5 5 5 6

CHAPTER 2: DEFINING LEADERSHIP STRATEGY ���������� 7 What is leadership strategy? ��������������������������������� 7 What is a leadership brand and why is it important? ����������� 10 Leadership style��������������������������������������� 15 Leadership values������������������������������������� 17 Leadership levels�������������������������������������� 19 Leadership complexity, capabilities and competencies������ 25 Defining leadership strategy���������������������������� 27 The leadership framework������������������������������ 28 Conclusion����������������������������������������������� 33 CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION �� 35 Research findings on talent identification______________________ 36 Defining the organisational leadership capacity requirements36 Leadership assessment��������������������������������� 37 Appropriate assessment and selection�������������������� 43 Governance������������������������������������������� 47 Conclusion________________________________________________ 48 CHAPTER 4: LEADERSHIP CAPACITY BUILDING __________ 51 Research findings___________________________________________ 51 Key principles regarding leadership development______________ 52 i

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Leadership development architecture_____________________ 53 Leadership development process_________________________ 56 Leadership development content_________________________ 59 Formal content_____________________________________________ 61 Leadership coaching____________________________________ 65 Leadership transition programmes________________________ 67 Informal development ______________________________________ 70 Learning portal_________________________________________ 70 Leadership summit_____________________________________ 70 Breakfast conversations__________________________________ 71 Rotation/Expanded role_________________________________ 72 Action learning_________________________________________ 72 Integrated leadership excellence development model____________ 74 Conclusion________________________________________________ 75 CHAPTER 5: LEADERSHIP GOVERNANCE_________________ 77 Governance approach_______________________________________ 77 Principles______________________________________________ 78 Role-player analysis_________________________________________ 78 Leadership assessment and development governance considerations__________________________________________ 79 Other leadership strategy governance matters__________________ 82 Conclusion________________________________________________ 84 CHAPTER 6: BENEFIT REALISATION_______________________ 89 Measurement approach_____________________________________ 89 Matrix of metrics___________________________________________ 91 Metrics (KPIs) application_______________________________ 94 Domains of metrics _____________________________________ 94 Conclusion_______________________________________________ 101 CHAPTER 7: LESSONS LEARNT___________________________ 103 Business lessons___________________________________________ Leadership lessons_________________________________________ Professional lessons________________________________________ Personal lessons___________________________________________ Conclusion_______________________________________________

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103 104 104 105 106

CHAPTER 8: THE CHANGING WORLD OF WORK_________ 107 The classical approach______________________________________ 107 The neo-classical approach__________________________________ 109 Concluding remarks___________________________________ 110 The modern approaches____________________________________ 110 Organisations as natural systems________________________ 111 Organisations as open, social systems____________________ 111 A contingency approach to organisations_________________ 113 Stratified systems theory (SST)__________________________ 113 The modern organisation___________________________________ 117 Characteristics of modern organisations__________________ 117 Design and models of modern organisations______________ 120 Future world of work – a systems perspective_________________ 126 Creating a thinking framework__________________________ 127 External macro context_________________________________ 128 The organisation of the Future_______________________________ 129 Vision and purpose____________________________________ 129 Core competencies_____________________________________ 129 Structure and design/Place of work______________________ 130 Organisational culture__________________________________ 131 Success measurements_________________________________ 131 Leadership____________________________________________ 134 Governance___________________________________________ 138 The work situation of the future_____________________________ 140 The meaning of work___________________________________ 140 New employee contract – contingent employment_________ 143 Characteristics of the ‘worker’___________________________ 143 Impact of technology, information and communication_____ 144 Customer relationships_________________________________ 146 Conclusion_______________________________________________ 146 CHAPTER 9: THE CHANGING WORLD OF LEADERSHIP___ 149 An overview of leadership theories__________________________ Early approaches to defining leadership______________________ Trait approach________________________________________ Skills approach________________________________________ Style/Behavioural approach____________________________

149 150 151 152 153 iii

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Situational approach___________________________________ Contingency approach_________________________________ Contemporary leadership approaches________________________ Transactional and exchange approaches__________________ Transformational approach _____________________________ Transcendental approach_______________________________ Servant leadership_____________________________________ Psychodynamic approach_______________________________ Spiritual leadership ____________________________________ Conclusion_______________________________________________ The future business leader__________________________________ The organisation of the future_______________________________ The work of leadership_________________________________ The nature of leadership________________________________ Conclusion_______________________________________________

154 155 156 157 157 158 159 161 162 163 165 166 166 167 170

BIBLIOGRAPHY_________________________________________ 173 INDEX___________________________________________________ 177

iv

About the authors Anton is currently the managing director of Engage Leadership and in this capacity he focuses on leadership and executive assessment and development. He has extensive experience in the fields of business strategy, executive and leadership development, and Talent Management Processes and Systems. His philosophy in life is summed in the words of Albert Einstein: “It is not about the right answer, but about the right question.” Letitia specialises in the field of leadership development and assessment and is interested in the challenges associated with leadership transitioning. She firmly believes that the role of a leader is to provide hope – no matter how dark the hour, there should always be hope. Her philosophy to life is reflected in the words of Martin Luther King, Jr.: “The ultimate measure of a man is not where he stands in moments of comfort, but where he stands at times of challenge and controversy.” Francois is very experienced in a broad range of human capital, leadership assessment and organisational diagnostics interventions. He consults to a range of companies in diverse industries. Francois is known for his ability to create clarity and perspective around a broad range of perspectives and his motto in life is reflected in the words of Leonardo DaVinci: “Simplicity is the ultimate form of sophistication.”

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Preface By now it is old news that the 21st century promises to be turbulent and will lead to changes in legal and popular concepts pertaining to organisations. In our experience, it is as if organisations are finding themselves mid-stride between an old and a new era – they have not yet found their way in defining their purpose and determining the consequences of their leadership. The old no longer works and tested business practices no longer deliver the expected bottom-line results. People are starting to change, and leadership practices of the past that once worked so well now result in high employee turnover and disengagement from the workplace. In trying to understand leadership and leadership competence, researchers through the years have focused on traits, styles, the contingency viewpoint and transformational leadership, to name a few. Despite the available research, numerous studies have continued to register concerns about building leadership capacity within organisations. This leads us to the question of how to build sustainable leadership solutions that are cost effective and suitable for organisations. This book is a follow-up to Reshaping leadership DNA: Applying research in the real world of work. The aim of this publication is to provide practical tools and methodologies that have worked for us and our various client systems through the years. We aim this book at people who understand that leadership is important for strategy realisation. You may be a senior leader who is currently facing a leadership crisis (successors, inappropriate talent, etc.) or one may be looming in the future; you may be busy with strategic repositioning (entering new markets, M&A). This book is for everyone who is thinking about the future and proactively wants to build leadership capacity. It is especially for those people who know what they want to do, but do not necessarily know how to go about it.

vi

This book is divided into two sections: • Section 1 deals with defining and implementing leadership strategy in a practical manner; • Section 2, which deals with the theory, is a summary of our book Reshaping leadership DNA. Anton, Letitia and Francois June 2011

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CHAPTER 1 LEADERSHIP AS A STRATEGIC IMPERATIVE We have always believed that building strong leaders is a strategic imperative. When times are easy, leadership can be taken for granted. When the world is turbulent, you appreciate great people. – Jeffrey R. Immelt, GE’s Chairman and CEO

Introduction When you read newspapers and business reviews it appears as if there is an intensifying and growing crisis with respect to leadership on a global scale. This crisis pertains to leadership in the world of politics, business, sport and religion. What is not so clear, is what is really meant by ‘crisis’ – is it the institution of leadership itself, the context within which leadership operates and/or the persons filling leadership roles? In our consulting work we are faced with questions such as: What is leadership and does it matter? What is effective leadership and how does the context affect its effectiveness? Where do good leaders come from? Are the right persons exercising leadership? Are people adopting the appropriate styles of leadership, given changing times, and the shifting needs and expectations of employees? This leadership crisis and the related questions are actually not new problems – already in 1978 James McGregor Burns, the Pulitzer Prizewinning author of the book Leadership, coined the phrase ‘leadership crisis’. He offered some insight into the problem when he stated that most of us – experts included – would have a problem knowing what 1

RESHAPING LEADERSHIP DNA FIELD GUIDE

leadership is. In his book he stated that if a Martian were to come to Earth and ask an earthling: ‘Take me to your leader!’, the earthling would not know where to go. It seems very little has changed – people still cannot agree on what leadership is. .

A recent study by Development Dimensions International (DDI) (Leadership Forecast 2011) shows a disturbing trend. After a decade of trying to build organisations’ leadership capability, little or even no progress has been made globally. In our experience, many organisations are faced with significant leadership competency gaps, and are forced to rely on an evernarrowing base of managers who are sufficiently skilled to enact new managerial roles. We have also found that a wide range of social and business influences determine the leadership behaviour within an organisation. The challenges which leaders and organisations face today are increasingly complex: words such as ‘volatile’, ‘multidimensional’ and ‘unprecedented’ are just a few of the descriptors leaders use when discussing these challenges. This, we think, calls for a radical rethink of what is meant by ‘leadership’, the way we develop leaders, the way we make promotion and selection decisions, and the very role of leadership itself.

Does the quality of leadership really matter? Despite the gloomy findings of the DDI (discussed above) and the current harsh economic circumstances, many organisations have survived and some have even performed superbly, financially speaking. This does raise questions about whether the quality of your leadership really matters. Does it matter if your leadership strategy is well formulated, if you have good leadership talent practices and invest money in leadership development? 2

Organisations with the highest quality leaders are 13 times more likely to outperform their competition in key bottom-line metrics such as financial performance.

CHAPTER 1: LEADERSHIP AS A STRATEGIC IMPERATIVE

Let’s see what the research can tell us. The Leadership Forecast 2011 results (involving over 2 600 organisations in 74 countries) indicate that the difference between the impact a top-performing leader has on an organisation, compared to that of an average leader, is at least 50 per cent. In fact, these findings demonstrate that organisations with the highest quality leaders are 13 times more likely to outperform their competition in key bottom-line metrics such as financial performance, quality of products and services, employee engagement and customer satisfaction. Specifically, when leaders reported their organisation’s current leadership quality as poor, only six per cent of them were in organisations that outperformed their competitors. Compare that to those who rated their organisation’s leadership quality as excellent: 78 per cent were in organisations that outperformed their competitors in bottom-line metrics. The answer to the question about leadership quality seems simple: good leadership simply makes good business sense. Now that we understand that leadership matters, the next logical question would be: What is leadership? There are more than 800 different definitions of leadership, and every year more than 50 new books on corporate leadership are published in the United States (US) alone. We think it is easier to answer this question by looking at what leaders do.

The work of leaders In the first instance, the work of leadership is to ensure that the organisation is successful in terms of the measures of success defined for it. With the possible exception of owner-managed businesses, leaders (managers) are also employees, and in this capacity they are expected to make a contribution to the purpose/vision/objectives of the owners of the organisation. Leadership includes the task of building collaborative teams, of teaching a common vision and organisational principles, as well as instilling and encouraging trust. Viewed from this perspective, leaders will want to display the behaviours that will lead to these expectations being met.

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As mentioned above, one of the important roles of managers is to manage and lead employees (followers) working directly for them. The question arises: What important contributions would followers at each level of work most likely appreciate, and what would enhance their commitment to their work and their managers? Table 1 provides an overview of those perspectives on work that followers may be attracted to, which push them to offer their discretionary energy to their leader. Table 1: Overview of perspectives on work

Organisational work Theme

Required weadership

Key perspectives on work that followers appreciate

Quality

Formational

Accuracy

Service

Transmissional

Consistency

Practice

Transactional

Excellence

Strategic development

Transformational

Integrity

Strategic intent

Transcendental

Tolerance

Adapted from Fallow 2009: 147

Much of the leadership and talent work we do uses Levels of Work Theory to help clients design their organisation and work in a manner that creates clear boundaries as well as interdependencies. This facilitates individual clarity of purpose and expectation, and brings about collective alignment and focus. If you accept the concept of levels of work being present in an organisation, the implications for leadership are:

4

•

Leadership exists at various levels, not only at the top;

•

The work of leaders differs, in relation to the different levels;

•

Leaders at different levels may require different skills; and

CHAPTER 1: LEADERSHIP AS A STRATEGIC IMPERATIVE

•

The development of leaders and leadership across these levels requires planning.

Leaders who are not aligned to the complexity of the work they are required to do, pose an organisational decision-making risk that will also impact the effectiveness of other levels of work.

Getting started As a senior leader in an industry facing an unknown future, you might wonder what you can do to address this so-called leadership crisis. Where should you start?

Leadership talent is the key First, recognise that leadership talent is the key to the future. In the past, success in organisations was defined by having the best assets and technical excellence (especially along the lines of technology). While these factors will continue to be important, successful organisations will be those that can attract and retain the best talent. You will need to communicate this extensively, while demonstrating your commitment practically.

It starts at the top Second, recognise that leadership talent will only flourish if this emanates from the top. Your own commitment to strategic leadership capacity building must be authentic. If it is, even small-scale efforts can deliver powerful results. Capacity building should not merely be treated as the work of the Human Resources Department.

A well-thought-through leadership strategy Lastly, leadership excellence will not happen by chance. It requires a well-thought-through strategy where you address aspects such as leadership competencies (What does it mean to succeed?), leadership selection, leadership capacity building, and integrate a leadership philosophy and approach into the organisation’s DNA.

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Using this book This book consists of two parts. The first is meant as a practical ‘how to’ guide for developing and implementing a leadership development strategy. It is written in a style that is to the point, contains very little academic language, and presents a number of templates and other recommended toolsets. The second part of the book offers the academic background to leadership strategy. Here the reader will find the theoretical and research background to the practical steps we propose. Should you read both sections? It is really up to you, but we suggest the following way to master the field guide: •

Scan the first part, so that you have an understanding of the overall process of developing and implementing a leadership strategy;

•

Read the second part to obtain some insights into the theory and research underpinning the practical approach;

•

Start working through the first part in detail.

Whichever way you choose to use the book, we know it will help you clarify your own thinking and will hopefully also simplify and speed up the implementation process.

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CHAPTER 2 DEFINING LEADERSHIP STRATEGY When we run leadership strategy definition workshops, we often find consistent thinking within organisations about how to be better leaders. Such thinking includes: set a vision, have energy, energise others, mobilise commitment, manage teams, coach, have integrity, think globally, etc. We have found that many of the current efforts to be or to build better leaders have led to generic models of leadership. These models fall short because they are not linked to results, are not tied to the future, and are not inculcated in the organisation as part of its DNA. As a first step to reshape leadership DNA, you need to put together a detailled leadership development strategy document. The purpose of this document is to create a formal record of the thinking of the organisation, so that specific interventions can be properly contextualised at a later stage. Leadership strategy is also about defining your leadership brand, but more on this concept later.

What is leadership strategy? Most, if not all, of the readers of this field guide will be familiar with one or more approaches to strategic planning, and will therefore have some sense of what a strategy document, as the output of the process, looks like. Leadership strategy as a process is no different from defining organisational strategy, but clearly the focus is very specific. In the same manner you would, as part of the strategic planning process, ask questions such as:

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1. In which markets do we need to compete? 2. What products and services do we offer, to which segments of these markets? 3. What resource capacity do we need ­(and have) in order to compete effectively? With an understanding of where your organisation is going over the next few years, some leadership issues to be addressed are the following: Toolkit item: Crucial leadership questions •

Given the environment we will compete in, do we have the required leadership profile? (Also refer to Chapter 3.)

•

What brand essence do we need to portray to external stakeholders, and do we have the leadership capacity to do so consistently?

•

Will we be competing in new/different markets that will require leadership skills we do not currently have?

•

Is the way in which we have identified and developed leadership to date appropriate for our future positioning?

•

Do we have a clear idea of what we expect as a business benefit from our investment in leadership?

The following figure provides an outline of how thinking about leadership strategy must absolutely be informed by the manner in which the overall business strategy is aimed at competitive positioning.

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CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Competitive Landscape (PESTLE) Business Strategy 





 Leadership framework • Philosophy • Behaviours (capabilities and competencies)

Appropriate assessment and selection • Criteria • Methodology • Instruments

Craft development solution • Formal and informal • Level relevant • Experiential

Benefits realisation assessment

Governance

Appropriate metrics

• Ownership of leadership talent • Accountability for leadership capacity • Talent management linkages

• Link to business strategy and imperatives • Organisational and individual

Figure 1: Leadership strategy in context Adapted from Deloitte Development LLC.

Given the above there is, in reality, only one key question to be addressed by your leadership strategy, namely: What type of leadership capacity do we require to execute our business strategy effectively now and in the future? Once this question has been answered, the following questions arise: 1. How do we identify such leaders? 2. How do we develop such leadership? 3. How do we manage and measure the benefits realisation of the leadership strategy to ensure that it benefits the business? The balance of this chapter will address, in as simple and systematic a manner as possible, the roadmap to exploring ­and answering ­these questions.

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What is a leadership brand and why is it important? In marketing, developing a product brand means that the product can be differentiated from other products of the same type. To improve a product brand, researchers increase product efficacy while marketers work on advertising. When product efficacy and advertising are both successful, a product brand is established and the product typically achieves a price premium of about 30 per cent.

A leadership brand is something that both employees and external stakeholders perceive. It is what we become known for as individuals and as a company.

Leadership branding refers to the same kind of process. To improve a leadership brand, leaders must increase their efficacy in attaining results, while senior leaders must ‘advertise’ these results to shareholders and investors. Leadership in a company is branded when unique competencies and specific business results are integrated for all leaders within the organisation. Over a period of years, an organisation may create leaders who are ‘branded’ or distinct from leaders in other organisations. Leaders who develop only common attributes of leadership do not establish a leadership brand. What is missing is the notion that these attributes need to link clearly to business results. Because business results are company-specific, a leadership brand should also be unique to a specific organisation. When the attributes which leaders demonstrate are linked to desired results, distinctive branding follows. A leadership brand advances such leadership beyond generic competencies. Conceptually, a leadership brand can be described as follows:

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CHAPTER 2: DEFINING LEADERSHIP STRATEGY

External leadership brand

Leadership style

Leadership values

Internal Leadership Brand

Organisation culture and climate Internal Leadership Brand

Leadership levels

Leadership competencies

External leadership brand

Figure 2: Leadership brand

The first important point about a leadership brand is that it has both an external and an internal component. From the external leadership brand perspective, certain specific questions that need to be answered, appear below: Toolkit item: Crucial leadership brand questions 1. Given our business strategy, are we a single-brand company, or do we have multiple brands? 2. If we are a multi-brand company, would each company require a uniquely different leadership brand to compete in the marketplace? 3. If we are a multi-brand company with different leadership brands, is there some level of leadership which requires a single brand? 4. Who are our key external stakeholders? (These may be clients/ customers, investors, market analysts, shareholders, financial institutions, organised labour, government, and so on.)

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5. How would we like these external stakeholders to describe our leadership? When they engage with us in the marketplace, what impression would we like to leave with them? Is it the same for all external stakeholders? 6. How would we like internal stakeholders (employees, partners, providers) to describe our leadership, based on their experience of our organisation (and us as a leadership community)? Completing a table such as the one below may be useful in ensuring that these questions are adequately addressed. Toolkit item: Stakeholder analysis Table 2: Template: Shareholder analysis

Stakeholder

Their desired perception

Their current perception

External Customers Shareholders Financial institutions

Internal Employees Partners Providers Having completed such a table, look for trends across all stakeholders, so that the core or essence of the leadership brand is distilled. Once you have a sufficiently clear sense of what the internal and external leadership brand should be, the next set of questions should include:

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1. What leadership style will best support our desired leadership brand? 2. What specific set of values (behaviours) will best support our desired leadership brand? Which of these are truly nonnegotiable? 3. What specific leadership skills (competencies) are required to ensure that we live our leadership brand consistently? 4. Can we align the behaviours of leaders at different levels of the organisation, so that the brand is lived across all levels in a consistent manner? In Figure 2: Leadership brand, the focus is on ‘culture and climate’. The implication quite clearly is that the culture and climate of the organisation are determined (at least in large part) by leadership style, values and competence. It is beyond the scope of this field guide to explore, in detail, the theory of organisational culture and climate. For our purpose it is sufficient to define organisational culture as the enduring (long-lasting) ‘way of doing things’ in the organisation, whilst climate can be described as the ‘shorter-term experience (typically by internal stakeholders) of specific events, processes and practices’ of the organisation. The literature suggests that in essence there are four types of organisational culture, which may be described as follows: 1. A power culture is based on the dominance of one or a small number of individuals within an organisation. They make key decisions on behalf of the organisation. This sort of power culture may exist in a small business or in part of a larger business; 2. A role culture exists in large hierarchical organisations, in which individuals have clear roles (jobs) to perform which are specified in detail. Individuals tend to stick closely to their job description, and tend to follow the rules rather than operating in a creative way;

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3. By contrast, task cultures exist when teams are formed to complete particular tasks. A distinct team culture develops, and because the team is empowered to make decisions, task cultures could be creative; 4. A person culture, which is the most individualistic form, exists when individuals are fully allowed to express themselves and make decisions for themselves. A person culture can only exist within a very loose organisational format, e.g. an overseas salesperson who works on his/her own for a company, and who is allowed to make his/her own decisions. Given these definitions, complete the following table (create a similar one for yourself if you have a different approach to culture types), by allocating a total of 100 points to each of the types, based on their existence within your company. Toolkit item: Culture exercise Table 3: Template: Culture

Culture type

Score out of 100

Power Role Task Person TOTAL

400

Based on the ratings in respect of the types of culture, complete the following table: Toolkit item: Culture implications

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Table 4: Template: Culture implications

Culture type

Positives

Limitations

Power Role Task Person Given the potential advantages and disadvantages of your culture type profile, what – in your view – are the specific implications for leadership behaviours, and therefore for your internal and external leadership brand?

Leadership style Certainly a difficult issue for leaders to come to terms with, is the fact that their leadership style is not determined by themselves, but is experienced by others. Leadership style is therefore not about your intent, but about how you are perceived by others. Leadership style is also not so much about WHAT you do, but about HOW you do things (as experienced by others). Using the following table, decide where you would position your organisation’s predominant leadership style on a scale from 1 to 10 (for each of the three dimensions).

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Toolkit item: Leadership style Table 5: Leadership style

Task clarity 1

2

3

4

5

6

7

8

9

We let people discover for themselves what they are supposed to do

10 We let people know exactly what they are supposed to do

Inclusiveness 1

2

3

4

5

6

7

8

9

We make all important decisions as leaders

10 We include people in all decisions that may impact on their work

Caring 1 People are rewarded appropriately for their contribution to the business

2

3

4

5

6

7

8

9

10 We make sure that people feel important

Given your rating on each of the three dimensions, you may want to reflect on the following questions:

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•

Would your employees complete this rating differently from what you have done?

•

What are the implications for culture and climate if your assessment is correct?

•

Will this support the building of the desired internal leadership brand?

Leadership values The topic of values is equally complex. In this section, however, we will attempt to simplify matters by suggesting that values are foundational to our behaviours, in the sense that they shape and filter our thinking. There are numerous theoretical models of values, and you may already have a preference for a specific approach. The following is therefore only an example of a process you need to go through, to clarify the leadership implications of a particular set of values. Your company may even have a documented set of values that you could use as a point of departure.

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Financials/ Performance

Expertise/ Knowledge

Teamness/ Collaboration

Values

Innovation/ Creativity

Influence/ Power

Figure 3: Values in an organisation

Assuming that the above figure reflects your company’s values, complete the following table (create a similar one for yourself if you have different values) by allocating a maximum of 100 points to each value, based on its importance to your company. Toolkit item: Values exercise Table 6: Template: Values

Value

Score out of 100

Financials/Performance Expertise/Knowledge Influence/Power Innovation/Creativity Teamness/Collaboration Total

500

Based on the importance rating of the values, complete the following table:

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Table 6: Continued

Value

Importance (1.5)

Expected behaviour

Nonnegotiables

Financials/ Performance Expertise/ Knowledge Influence/Power Innovation/ Creativity Teamness/ Collaboration In the importance column, simply assign a number from 1 to 5 to each value, based on the scores allocated in Table 6: Values. Then ask yourself the following in regard to the top three values: •

What do you actually expect of leaders in terms of their behaviour? (Be as specific as possible.)

•

What are the non-negotiables? What will leaders do that could really be career-limiting (or -ending!)?

•

Is there a clear relationship between your leadership values and your leadership styles?

Leadership levels We suspect that at this stage, even if only at an intuitive level, you may have started reflecting on the different echelons of leadership within your own organisation. When reflecting on the values displayed by your leadership, are you talking about supervisors, middle management or executives? Are these levels the same, and should they be? Do you assess and develop leaders at these different levels in the same way?

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RESHAPING LEADERSHIP DNA FIELD GUIDE

In our experience, garnered over a number of years with clients from different industries, we have found it useful to introduce the principles of levels of work (see also Chapter 9). Essentially, levels of work suggests a general model of organisational functioning, for instance that there are increasingly complex critical tasks or requirements at each successive organisational level, and that effective leaders address these tasks at the required level of complexity. The levels of work can also be described according to themes of work complexity, as indicated in the table below: Table 7: Complexity and organisational work themes

20

Organisational work themes

Level of competency

Time span

Quality (Type I)

Competent ‘hands-on skills’ to complete a task or activity

1 day to 3 months

Service (Type II)

Competent in supporting and coordinating workers to achieve set standards

3 months to 1 year

Practice (Type III)

Competent in constructing, connecting and fine-tuning systems for optimal utilisation of resources

1 year to 2 years

Strategic development (Type IV)

Competent in integrating new futures, services and products, including positioning the organisation within the market context

2 years to 5 years

Strategic intent (Type V)

Competent in a unified work system by understanding the organisation’s purpose

5 years to 10 years

CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Filling roles with capable people at all these levels on an on-going basis brings a three-fold benefit: •

Effectiveness is increased because strategic goals, responsibilities and accountability have been assigned to people capable of meeting or delivering on them;

•

Efficiency is improved, because people are doing work at the level they are paid for;

•

Trust is greatly enhanced, because employees understand they have a future in the organisation.

One of the important roles of leadership is to manage and lead the employees (followers) directly to them who report to them. The question is what the important aspects are that followers at each level of work would most likely appreciate, that would enhance their commitment to their work and leaders. Table 8: Leadership levels

Quality (Type I): Formational leader

Employees (followers) at this level tend to respect and value accuracy, because it provides certainty and structure. It is therefore important for managers to understand what is happening on the shop floor. It is here where most of the quality type of work is performed on a daily basis.

Service (Type II): Transmissional leader

At the service level, people are attracted to consistency. Effectively, leaders at this level communicate messages about their expectations and their performance, as regards what constitutes acceptable limits of performance and behaviour, and what does not. An example would be how professional HR staff guide managers

21

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Table 8: Continued

on how to conduct an interview, by imposing limits on what may be asked. This ensures that behaviour falls within policy and procedural frameworks and creates order within the boundaries of the organisational system.

22

Practice (Type III) Transactional leader

The level 3 manager focuses on optimising business processes, so that everyone’s energy losses are minimised and best practice is established. This has a direct impact on profitability.

Strategic development (Type IV) Transformational leader

The work of transformational leaders is to navigate between current certainty and the best of the preferred futures, in which there is no certainty and there are no guarantees. The only thing employees can rely on is the integrity of their leaders, as demonstrated by the way they lead employees into the future.

Strategic intent (Type V) Transcendental leader

The focus is global, and on shaping the organisation to ensure long-term sustainability in a rapidly changing environment. It is a long- term journey, often characterised by chaos and uncertainty. Tolerance in accommodating different views and navigating the organisation through turbulence is required – and is usually appreciated by employees.

CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Toolkit item: Leadership levels Consider the following: Table 9: Leadership levels: Questions

Question

In your organisation

Do you have adequate leadership at all these levels in your business? Do you have adequate leadership at the different levels, allowing you to recruit/promote from within? Do you have adequate leadership at the different levels, considering what your business will need going forward? Having some sense of the situation in your organisation, as well as the potential implications thereof for the business, is a key factor in understanding the breadth and depth of the potential challenge you may face in developing and implementing a leadership strategy.

Checkpoint At this stage, having applied the various questions and templates to your own context, you should have a fairly good sense of the following: •

The specifics of your desired leadership brand in terms of how you would like to have key stakeholders perceive, experience and describe your company;

•

The values, style and skills that will be required of leaders in order to deliver on the leadership brand ‘promise’; and

•

The different levels at which leadership exists. 23

RESHAPING LEADERSHIP DNA FIELD GUIDE

Completing the following table may help to consolidate the insights you have gained thus far. Table 10: Leadership brand checkpoint

What is your leadership brand essence?

Insert the trends identified, as referred to on page 16.

What specific behaviours do your leaders require to live this brand essence?

Consider your views, as noted in the preceding sections of this chapter.

Do you have the leadership capacity needed at the various levels of the business, going forward?

Consider your views, as noted in the preceding sections of this chapter.

What is your leadership brand essence and culture? What specific behaviours (style, values) do your leaders require to live this brand essence? Do you have the leadership capacity needed at the various levels of the business, going forward? Having completed a table like this may, for many organisations, be a perfectly adequate starting point for developing a clearly defined leadership strategy. Those companies are welcome to progress directly to the section titled ‘Defining leadership strategy’. For those with a business need and an appetite for more detailled thinking and strategising on leadership, the following sections will provide practical guidelines on dealing with some of the more complicated issues related to formulating a leadership strategy. 24

CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Leadership complexity, capabilities and competencies This section defines leadership and describes the relationship between leadership and complexity. Clear distinctions are made between competency and capability. Competency and capability models can help to identify the desired leadership behaviours required within an organisation, specific to each level of complexity.

Capability versus competence The existence of the two types of description of competence, namely ‘competencies’ and ‘competences’, has given rise to confusion and led some researchers to describe behavioural competencies as ‘capabilities. The purpose of this section is to define what the concepts ‘capability’ and ‘competence’ mean, as they have particular importance for the way we think about leadership and talent management issues. Capability is defined as the ability to generate, prefer and demonstrate appropriate work-type-specific complexity, values, activities, perceptions, judgements, interpersonal qualities, problem solving, etc. Outcomes/ Results Competence

Capability

Figure 4: Capability vs. competence

As can be seen in Figure 4, competence builds on capability. This is discussed in more detail in the section below. 25

RESHAPING LEADERSHIP DNA FIELD GUIDE

Capability Capability refers to those aspects of a person that are intrinsically part of him/her and cannot easily be changed or developed (trained). Capability centres on what each individual is able and willing to be or do. This includes the ability to prefer, generate and demonstrate appropriate work-type-specific complexity, values, activities, perceptions, judgements, interpersonal qualities or problem-solving skills, amongst others. The closer the ‘nature’ of a person is aligned to the ‘nature’ of a particular job profile, the greater the person’s chance of being sustainably competent in the long term (and these people will have fun too, because they will keep themselves busy with work they naturally enjoy).

Competence Competence is defined as the ability to demonstrate worktype-specific functional business and leadership competencies. Competency comprises: •

Knowledge (reflexive),1

•

Skills (practical*) and

•

Attitudes (foundational).2

Competence refers to aspects of a position that can be taught. The key issue at play is that capabilities form the foundation on which people build competencies. Without the required capabilities for a role at a specific level or of a particular type being in place, we will simply not be able to build the required competencies.

1

Skills development terminology.

2

Skills development terminology now refers to experience, no longer to

attitude.

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CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Now that we have clarified the context around leadership brand, the next section will focus on defining leadership strategy.

Defining leadership strategy The section below outlines the proposed content of the leadership strategy. Toolkit item: The content of the leadership strategy •

What key business challenges impact directly on leadership?

•

Considering these challenges, what are their key implications for leadership development?

•

What should the leadership vision (brand) be?

•

Considering the business challenges and leadership vision, what competence do we require from our leaders?

•

How will we assess the leadership competence profile?

•

How do we need to build/develop leadership?

•

How should leadership development be managed?

•

How will we measure the value add of leadership development?

•

How does leadership development link to the talent and people management processes?

Armed with the leadership strategy document, you can now direct your attention to the development of the strategy content. Broadly, this falls within three specific domains, namely •

articulating leadership competencies at different levels of complexity (we call this the leadership framework);

27

RESHAPING LEADERSHIP DNA FIELD GUIDE

•

translating the behaviours defined for the competencies into curriculum specifications;

•

setting up the various leadership assessment processes.

The leadership framework As a first step, a draft leadership competence framework needs to be formulated. The toolkit item below outlines the process for you. Toolkit item: The leadership framework •

Define the competencies needed to address the business challenges defined in the leadership strategy;

•

Define – for each competency in the framework – the required behaviour at different levels of complexity;

•

For each competency, define the degrees of proficiency within each level of complexity;

•

Highlight so-called ‘red flag’ behaviours for each competency.

The result of this process will lead to a draft document of behavioural descriptors for each competency, across different levels of complexity. The following two figures illustrate what the end result of this process will look like, as well as the possible application of these documents.

28

CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Table 11: Behavioural descriptors

Information processing Definition:

Uses rigorous logic and methods to solve problems with effective solutions. Probes all fruitful sources for validation. Is excellent at analysis. Looks beyond the obvious and doesn’t stop at the first answers.

Purpose:

Information processing is concerned with gathering, manipulating, storing, retrieving, and classifying of data. The role of leaders are to ensure the validity and availability of data.

Degree of proficiency Not exposed

Competent

Standard/

Highly

to before

under

independently

developed

guidance

competent

Strategic

Waits to be

Gathers

Seeks and taps

Actively scans

develop-

informed

information

into a range of

the external

ment

of new

from selected credible and

environment

information.

formal and

knowledgeable

for new and

information

sources about

relevant

networks.

the future

information.

business environment. Tends to only Uses only

Defines one

The decisions

identify one

limited

or more

made

alternative.

alternatives

appropriate

fundamentally

which as

courses of

change the

usually based action by

current or

on known

considering

popular

solutions

multiple

business

and past

alternatives

approach.

experiences.

and possible consequences.

29

RESHAPING LEADERSHIP DNA FIELD GUIDE

Not exposed

Competent

Standard/

Highly

to before

under

independently

developed

guidance

competent

Good

Takes

Tries to

Asks a series

Seeks to

practice

information

identify all

of probing

understand the

at face value,

the possible

questions to

implications

assumes

cause

get to the root

of issues on

information is and effect

of a problem

the different

valid.

relationships

or potential

parts of the

but misses

opportunity

business and

critical

below the

on customers.

information

surface of issues

at times.

presented.

Decisions

Identifies

Understands

Decisions

are based

the potential

and integrates

are based on

on poor/

impacts of

various

a mixture

inappropriate a problem

aspects/

of analysis,

judgment.

on some

dimensions

wisdom,

relevant

across the

experience and

areas of the

organisation

judgement.

operation

value chain.

and needs guidance to integrate this. Service

Takes

Sees the

Gathers,

Applies

information

need for

select and

information

at face value,

information

processes given

from a number

no or limited

gathering,

operational

of sources and

processing is

but waits

information in

perspectives,

done.

to be

order to assess

both holistic

informed on

the appropriate

and detailed.

operational

course of action

information.

from a limited number of options.

30

CHAPTER 2: DEFINING LEADERSHIP STRATEGY

Not exposed

Competent

Standard/

Highly

to before

under

independently

developed

guidance

competent

Service

Takes facts

Needs

Utilises given

Uses

(Cont.)

at face

guidance to

organisational

experience to

value and

appropriately frames of

take calculated

conclusions

interpret facts reference

risks when

drawn are

and to draw

(i.e. policies,

making

superficial.

conclusions.

procedures,

decisions in

systems, etc.)

situations

in interpreting

where no clear

facts and

guidelines

drawing

exist.

conclusions. Quality

Takes facts

Needs

Systematically

Assists

at face

guidance to

breaks down

others in

value and

systematically a complex

conclusions

break down

problem or

breaks down

drawn are

a complex

process into

a complex

superficial.

problem or

its component

problem or

process into

parts,

process into

systematically

its component identifying how its component parts.

these parts fit

parts.

together. Does not pay

Pays

Pays attention

Known for

attention

attention

to facts

attention to

to facts

to facts

and figures

detail.

and figures

and figures

supplied for

supplied for

supplied for

accuracy and

accuracy and

accuracy and completeness.

completeness. completeness on an ad-hoc basis.

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RESHAPING LEADERSHIP DNA FIELD GUIDE

Not exposed

Competent

Standard/

Highly

to before

under

independently

developed

guidance

competent

Red flag

Takes impulsive decisions without assessing the impact of

behaviour

decisions on the business. Ignores relevant information. Disregards inputs from others.

As can be seen in Figure 5, each competency is defined, given a purpose statement, described in behavioural terms across different levels of complexity as well as in progressive degrees of proficiency within each level and, finally, red flag behaviours are described. We advise you to workshop this document with leaders across the different levels in your organisation. As a methodology, we suggest you adopt a top-down approach, with each level required to review and comment on the •

full set of behavioural descriptors relevant to their own level (e.g. good practice);

•

independently competent behavioural descriptors of the levels above (strategic development), and leaders working at good practice level will review independently competent behavioural descriptors with strategic development level.

The purpose of such an approach is to allow leaders to become acquainted not only with the expectations of leadership at their own level, but also of the leadership expectations at the levels above and below them. In this manner, a leader can create awareness and understanding of the fact that at a behavioural level, expectations are different across different levels of complexity. This understanding is fundamental in helping leaders gain insight into why different assessment and development processes may be required for different levels of leadership. This principle is described in the workshops by highlighting the progression across levels (as in a leadership pipeline) through the independently competent behaviours per level. 32

CHAPTER 2: DEFINING LEADERSHIP STRATEGY

However, you need to consider the following when drafting the leadership framework: You may need to make adjustments as •

competitive circumstances change; and

•

the organisation becomes increasingly familiar with the framework and its application.

Conclusion For a field guide, this has been a particularly long chapter! The only thing we would have achieved by making it shorter, would have been to leave the reader without some really important content to consider. Throughout this book we will repeat the mantra that leadership strategy and its implementation are business strategies, deserving of as much management attention as strategies aimed at entering new markets, investing in new technologies, or developing new offerings. In fact, we will argue that it is possibly even more important. The simple reality is that without the leadership capacity to position the organisation in its strategic context and to generate the systems, processes and human capital needed to execute these, business strategy remains a fantasy, at best. We are reminded of the words of Mike Davidson (1995), a business strategist, who suggested that “Class A execution of a Class B strategy will always beat the Class B execution of a Class A strategy”. Rather keep your leadership strategy simple and execute it well!

33

CHAPTER 3 LEADERSHIP CAPACITY IDENTIFICATION It is not news that building and developing top talent should be a critical priority for today’s successful organisations. Working out how to do it faster, better and earlier, may soon become a significant competitive advantage. However, many organisations struggle with the simple basics of talent identification and selection. Various clients through the years have told us that they struggle immensely with getting this right. Let’s look at an example. Who of the following candidates would you select to work for your organisation? •

Candidate A: He associates with crooked politicians and consults astrologers. He has had two mistresses. He chain smokes and drinks up to ten Martinis a day.

•

Candidate B: He was fired from his job twice, sleeps until noon, used opium in college and drinks large quantities of whisky every evening.

•

Candidate C: He is a vegetarian, does not smoke, drinks the occasional beer and has never had an extra-marital affair.

Candidate A is Franklin D. Roosevelt, Candidate B is Winston Churchill, and Candidate C is Adolph Hitler. Yes, it’s easy to get it wrong. Furthermore, in most leadership talent identification processes there is an underlying assumption that past performance is the best predictor of future performance. This assumption is the bedrock on which most talent decisions are based. Past performance is usually the best predictor of future performance, 35

RESHAPING LEADERSHIP DNA FIELD GUIDE

but if you consider the principles of the Levels of Work Theory, success at a particular level of complexity is no guarantee of success at a level of increased complexity. But let’s first see what the latest research tells us about the state of leadership talent identification.

Research findings on talent identification The Leadership Forecast 2011 showed that more HR professionals rated leadership selection as the talent management system critical to future organisational success; yet, leaders reported selection to be the least effective system. Less than one-third of both HR professionals and leaders rated selection systems as effective in their organisation. This finding is even worse than the DDI’s Selection Forecast 2006–2007, which reported that about half of its respondents (staffing directors and hiring managers) were satisfied with their hiring processes.

Only 31 per cent of leaders and HR professionals rated the effectiveness of leadership selection as high.

Defining the organisational leadership capacity requirements We define leadership capacity as both the competence level and the number of leaders. Capacity = Competence × Number In other words, do we have enough of the right quality leaders at the appropriate levels of complexity? The process starts with

36

CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION

•

defining the organisation’s leadership capacity requirements for the present and the future;

•

determining the current status; and

•

articulating the gaps.

Leadership assessment The next step is to match assessment approaches and methodologies to the leadership framework, and also to the fundamental people and the leadership philosophy underpinning the entire leadership development strategy. As an outcome of this phase, a set of recommendations for assessment approaches and methodologies should be formulated, as well as a set of governance guidelines, which will also become part of the leadership development strategy document. In effect, the leadership assessment approach is about defining the ‘what’ and the ‘how’ regarding the assessment of •

capabilities, such as cognitive abilities and leadership personality profiles; and

•

leadership behaviour, based on the leadership framework.

Assessment of capabilities Capability assessments are usually conducted by means of psychometric assessments. Below is a short overview of the different types of psychometric instruments.

Cognitive/Capability assessments A considerable number of cognitive ability assessments designed for senior/executive management are available. Most assessments include a range of norms for specific job roles to compare a candidate’s results with a suitable peer group. Typically, cognitive assessments measure aspects such as

37

RESHAPING LEADERSHIP DNA FIELD GUIDE

•

basic intelligence;

•

non-verbal intelligence;

•

verbal and comprehension skills;

•

numerical and estimation skills;

•

critical thinking skills;

•

general reasoning skills;

•

symbolic reasoning skills; and

•

complexity capability.

Self-Image, social role and values Self-image refers to a person’s perception of him/herself and the evaluation of that image. This definition of self-image includes both self-concept and self-esteem. Since the development of a person’s selfconcept is influenced by the values held by him/her as well as the people in his/her environment, self-image can partly be interpreted in terms of these values. For this reason, and because values may have a direct influence on managerial performance, it is proposed that this construct be included in the design of a managerial assessment battery. Social role refers to a person’s perception of the social behavioural norms that are accepted by social groups or the organisation to which the person belongs. The various social roles people adopt help them to determine how they should behave as members of an organisation. As with any of the types of competencies, the self-image and the social role levels of competencies must be appropriate for the job and the organisational setting in which the work occurs, for the individual to be most effective.

Motives and traits A motive is a “recurrent concern for a goal state, or condition, appearing in fantasy, which drives, directs, and selects behaviour 38

CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION

of the individual” (McClelland, 1971). A trait is a disposition or a characteristic way of responding to an equivalent set of stimuli.1 Initiative can, for example, be considered a trait.

Assessment of leadership behaviour Leadership behaviour needs to be assessed through the physical observation of such behaviour by others. Psychometric instruments provide limited input here, and it is not always possible to assess all leadership behaviour by means of psychometric instruments. Below we discuss two tools that can be utilised to assess leadership behaviour, namely •

360° assessment; and

•

assessment centres.

360° assessment and feedback 360º feedback, also known as multi-rater feedback, multisource feedback or multisource assessment, is an assessment and feedback process that involves multiple participants. Feedback is provided by subordinates, peers and supervisors. It includes a self-assessment and, in some cases, feedback from external sources such as customers and suppliers or other interested stakeholders. We utilise a 360º assessment and feedback process to provide leadership performance feedback from multiple sources. As the feedback comes from a cross-section of people in the organisation, it is generally considered to be more objective and helpful in targeting leadership competence strengths and opportunities for improvement. Before we discuss the process, it is useful to consider the following research findings on 360º assessment, and the implications of these findings for implementing such a system in your organisation:

1

Klemp, G.O. (1977) ‘Three factors of success’, in G.W. Vermiley (ed), Relating Work

and Education: Current Issues in Higher Education. San Francisco: Jossey-Bass.

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•

The number of raters used in each rater category (direct report, peer, manager) affects the reliability of the feedback, with direct reports being the least reliable and therefore requiring wider participation;2 and

•

The response scale can have a major effect on the results; some response scales are indeed better than others.3

Outlined below are the steps followed in designing and implementing a 360º assessment and feedback process. Toolkit item: 360º assessment and feedback process Table 12: Template: 360º assessment

Constructing the instrument Process design Communicating the process Implementing the process

Toolkit item: 360º issues to consider for an effective 360º feedback process4

2

Greguras, G.J. and Robie, C. (1998) ‘A new look at within-source interrater

reliability of 360-degree feedback ratings’, Journal of Applied Psychology, 83, 960–968. 3

Caputo, P. and Roch, S. (2009) Rating formats and perceptions of

performance appraisal fairness. Paper presented at the Society for Industrial and Organisational Psychology Annual Conference, April, New Orleans, LA. 4

Adapted from Charlotte Podowski.

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CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION

Table 13: Template: Designing the 360º feedback process PURPOSE What is the purpose?

To develop people or to evaluate them?

WHO ... will be assessed?

Managers, supervisors?

will receive feedback?

Individuals, teams, levels, functions?

are the feedback givers?

Self, manager, peers, team, customers?

receives/gives the results?

Who collects the data? Who provides the results?

WHEN ... is it accomplished?

What is the time frame? What actions are needed? What is the schedule of events?

HOW ... will the process look?

How is feedback given and to whom?

WHERE ... will it take place?

In face-to-face interactions? In automated format? At a group meeting?

Assessment centres An assessment centre consists of a standardised evaluation of behaviour, based on multiple inputs. Multiple trained observers 41

RESHAPING LEADERSHIP DNA FIELD GUIDE

and techniques are used. Judgements about behaviours are made, in major part, from specifically developed assessment simulations. These judgements are pooled in a meeting between the assessors or through a statistical integration process.5 The typical process consists of the following actions: •

Candidates participate in a series of exercises that simulate onthe-job situations;

•

Trained assessors carefully observe and document the behaviours displayed by the participants. Each assessor observes each participant at least once;

•

Assessors individually write evaluation reports, documenting their observations of each participant’s performance;

•

Assessors integrate the data through a consensus discussion process led by the centre administrator, who documents the ratings and decisions; and

•

Each participant receives objective performance information from the administrator or one of the assessors.

It is, however, important to consider the following: •

The assessment centre must simulate the appropriate level of complexity, e.g. a Type 4 assessment must simulate Type 4 work; and

•

Assessors themselves must be able to generate the level of complexity required by the assessment centre. An assessor who is only able to generate Type 2 complexity cannot be utilised in a Type 4 assessment centre.

5

Guidelines and Ethical Considerations for Assessment Center Operations. Task Force on

Assessment Center Guidelines; endorsed by the 17th International Congress on the Assessment Center Method, May 1989.

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CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION

Appropriate assessment and selection Appropriate assessment and selection entail matching the assessment to the Level of Work. In our opinion this consists of four drivers, as illustrated in Figure 5: Technical issues

Governance

Assessment matched to level

Process issues

Practical issues

Figure 5: Appropriate assessment and selection

Technical issues First, the choice of instruments to be used for the selection of senior and executive management should be based on the results of a thorough job analysis or a strategic competency design that identifies the knowledge, skills, abilities and attributes required to perform that particular job. Any of the assessment instruments and technologies mentioned below can be considered when compiling an assessment battery for senior and executive management levels. These instruments have been well researched in terms of reliability and validity studies, according to their respective suppliers/vendors. More information regarding the specific studies is available from each of the suppliers/ vendors.

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It is important to keep in mind that the reliability of tests depends, to a large extent, on how they are administered and scored. Detailled administration instructions are provided, and it is strongly recommended that these be followed to the letter. Most organisations make use of a combination of assessment instruments to evaluate behaviour, experience, energy, emotional intelligence and personality. At the senior and executive management levels, assessment centres and thorough competency-based interviews are best practice. It is important to match the instrument to the level of complexity in terms of capability and competence. This is done by means of an assessment matrix. Below is an example of such a matrix. Toolkit item: Assessment matrix

44

Leadership dimensions

 

Competency

Table 14: Template: Assessment matrix

Capability

Competence

Level 4

Assessment instrument(s)

Capability

Competence

Level 3

Assessment instrument(s)

Capability

Competence

Level 2

Assessment instrument(s)

CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION

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RESHAPING LEADERSHIP DNA FIELD GUIDE

Process issues The assessment process commences by determining the purpose of the assessment. It is usually aimed at either selection or development, and for determining competence and/or capability. The figure below conceptually displays the typical assessment process: Toolkit item: Assessment process

Determine purpose and outcome of assessment

Provide feedback to candidate if applicable

Provide feedback to client

Compile best-fit assessment battery

Compile report

Arrange logistics with suppliers and candidates

Conduct assessment

Suggest next steps when applicable

Figure 6: Assessment process

The following points, which are relevant to the process, should be noted:

46

•

Assessments are always voluntary. Participants may only be assessed with their consent, preferably in writing;

•

It is advisable to provide participants with detailled feedback, but this is not necessarily the case when assessment is utilised for selection purposes;

CHAPTER 3: LEADERSHIP CAPACITY IDENTIFICATION

•

The client is entitled to access the results of the assessment, with the consent of the participant; and

•

Assessments are always done against certain criteria, e.g. the current job role, future job role or leadership framework.

Practical issues Practical issues involve aspects such as where and when the assessments will take place. This may seem irrelevant, but the physical venue and how people are treated during the process will have a significant impact on how they feel about and experience leadership assessments.

Governance The results of psychometric assessments should never be utilised in isolation, but always in conjunction with an interview, performance appraisals, reference checks, CVs and so forth, since a holistic approach is required when interpreting and utilising the results obtained. Most psychometric tests take two fundamental design principles into account: •

Validity; and

•

Reliability.

Defining reliability An assessment tool is reliable to the extent that it produces consistent results. How do we know to what extent an assessment tool is reliable? Reliability is determined by using a formula, which is mathematically represented by the letter ‘r’ (known as the reliability coefficient). The value of ‘r’ can vary between 0 and 1, with r = 0 being completely unreliable, and r = 1 being perfectly reliable. A reliability coefficient of 0.8 and above is generally agreed to be acceptable for an assessment

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measure – it is virtually impossible to have a perfectly reliable measure. Defining validity An assessment tool is valid to the extent that it measures that which it is supposed to measure. In other words, when asking whether or not an instrument is valid, you are asking whether the tool is actually appropriate for the purpose it claims to serve. Once again, there are various different types of validity, but the two that are of most use when discussing psychometrics are construct validity and criterion-related validity. Both types are defined and discussed in the paragraphs that follow. Construct validity When considering the construct validity of a tool, you are asking what concept that tool claims to be assessing, and to what extent it actually does that. Criterion-related validity Criterion-related validity is concerned with the degree to which the tool in question can ‘predict’ the actual state of affairs. The person’s assessment results are compared to, for example, his/her results on a job performance assessment. The extent to which the person’s job performance was correctly predicted from his/her assessment results is the extent to which the particular assessment can be said to have criterion-related validity for that particular job. In South Africa, psychometric assessments are governed by legislation, and all assessments should always meet the compliance criteria.

Conclusion Using validated selection tools is still critical for internal hiring and the promotion of leadership talent, because past performance is only partially predictive of future performance in a new role. Past 48

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performance will also not be an indicator of a leader’s ability to perform at a higher level of complexity. Validated selection tools are the single most effective way of ensuring that objective data are collected to inform selection decisions.

49

CHAPTER 4 LEADERSHIP CAPACITY BUILDING The design and development of the leadership development process and content can take place parallel to determining a suitable assessment process, as outlined above. The first key aspect to keep in mind is that leadership development is only part of the entire leadership brand, as defined in Chapter 2. Many factors other than development impact on the leadership excellence of the organisation, such as talent attraction practices (recruitment and selection), succession planning and promotion principles (pipeline management) and performance management (in terms of both values and results), to mention a few. Leadership and leadership development therefore also need to be viewed within the context of all the talent management philosophies, principles and practices that your organisation has in place. We suggest that rather than the one-year outlook driven by budget cycles (and, from a South African perspective, a workplace skills plan) that is typical of most leadership development curricula, the leadership development strategy should have an outlook of three to five years, from the perspectives of the organisation, your leadership talent pipeline and the individual leaders. But let’s start this chapter by looking at research on the latest trends in leadership development.

Research findings According to leaders who participated in the Leadership Forecast 2011 (DDI), training and development systems are the leading determinants of leadership quality, outperforming selection, performance management and succession systems. In fact, leaders 51

RESHAPING LEADERSHIP DNA FIELD GUIDE

in organisations with more effective leadership development programmes were eight times more likely to rate the quality of leadership as ‘very good’ or ‘excellent’. Yet, only about one-third of leaders and HR professionals rated their organisation’s leadership development efforts as ‘effective’, and there has been virtually no progress in this area over the past five years. This is bad news for leaders, the people they lead, and the organisation, as the role of a leader becomes increasingly critical.

Key principles regarding leadership development Based on both research and best practice, we highlight the following key principles which are relevant to an approach to leadership development:

52

•

Leadership development is a key element of business strategy. It involves creating a shared understanding amongst stakeholders of what the organisation needs to improve through leadership and associated leadership development processes, such as customer satisfaction, growth, market share, profitability, etc;

•

Leadership development should inform and be informed by the human capital strategy and be based on a shared understanding of the organisation’s human capital, plus the leadership philosophy and the values it wishes to entrench;

•

Leadership development should focus on creating a leadership brand that has both external stakeholder value and creates the culture the organisation desires, by incorporating a clear, relevant and consistent articulation of the organisation’s strategy and values to each of the leadership segments;

•

Leadership development focuses on the development of leadership capacity throughout the organisation (we suggest a blended learning approach);

•

The prioritisation of solutions should be based on a detailled review of the current and desired leadership landscape;

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•

Leadership development solutions should be integrated by taking into consideration the relationship between leadership development and technical/functional development; and

•

Leadership development solutions should be holistic in that they take into consideration both organisational and individual (or personal) development, and create a shared understanding of the leadership development ‘roadmap’.

Leadership capacity building consists of three pillars, which will be discussed in more detail in the sections to follow. The three pillars are •

architecture;

•

process; and

•

content.

Leadership development architecture The leadership development architecture defines the leadership development philosophy, as well as the physical operating model of the unit (within the organisation) which is responsible for leadership development. The architecture also defines how leadership development and capacity building are aligned to other processes within the sphere of human capital, such as talent management. The operating model pertains to the ‘logic’ required by the ‘unit or department within the organisation responsible for leadership development’ (e.g. Leadership Academy) to establish, unlock and deliver ongoing value in this respect. An effective operating model must be informed by the following design principles (or design criteria): Toolkit item: Leadership development operating model

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•

Clear ownership, responsibilities and accountabilities;

•

Simplicity;

•

Minimisation of duplication;

•

Standardisation;

•

Value-add;

•

Tight (i.e. centralisation) and loose (i.e. decentralisation);

•

Direct line of sight between actions and results/outcomes;

•

Involvement/participation;

•

Cost-effectiveness;

•

Agility/flexibility;

•

Responsiveness;

•

Customisation/localisation;

•

Integration/seamlessness.

The leadership development operating model design is supported by the learning value chain, of which the following is an example. Note that the terminology may, however, differ depending on the environment. Toolkit item: Learning value chain

54



Vendor management







Client relationship management

Content development & graphic design

Materials fulfilment (e.g. printing)

Marketing/ communication





Financials/ levies









Strategic planning

Instructional design

Facilities management



Registration/ scheduling services

Classroom support

Technology integration





Strategic relevance

Business challenges

Curriculum design



Administration

Needs analysis/ assessment

Facilator feedback

Delivery tools management



Content

Portfolio management



Delivery

Facilitator development

Authoring tools management



Technology

LMS/LCMS management



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Content refreshment

Reporting & metrics

Figure 7: The learning value chain

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•

Strategic relevance consists of three sub-processes, namely an evaluation of business challenges, the strategic planning cycle and client relationship management;

•

Administration consists of six sub-processes, namely the needs analysis or competency assessment, registration and scheduling processes, financials (and in a South African perspective, levy management), vendor management, marketing and communication, and report and benefits realisation;

•

Content consists of six sub-processes, namely portfolio management, curriculum design, instructional design, content development and graphic design, material fulfilment (e.g. printing, electronic distribution) and content refreshment;

•

Delivery consists of four sub-processes, namely facilitator development, facilitator feedback, classroom support and facilities management;

•

Technology consists of four sub-processes, namely LMS/LCMA management, authoring tools management, delivery tools management, and technology integration.

It should be noted that this value chain applies to more than just leadership development.

Leadership development process Leadership development should begin by clearly stating the business requirements and leadership framework against which all forms of leadership assessment should take place. Similarly, all development processes should be directly linked to the leadership framework and the results of assessment processes. Perhaps even more importantly, you need to address the question of what you are doing in terms of additional people management practices that support not only the development process, but also the objective of delivering – through development – leaders who fully perform in terms of all of your expectations and requirements.

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In terms of a typical human capital value chain, it therefore means that at least the following should fully align with your approach to leadership: •

Assessment for recruitment and selection purposes;

•

Processes for on-boarding;

•

Learning and development processes and interventions;

•

Coaching and mentoring;

•

Performance and development management;

•

Job grading and evaluation;

•

Remuneration and reward; and

•

Succession planning.

For this integration to be seamless, it is important to recognise that some fundamental issues, such as the principles of organisation architecture and talent philosophy, must be agreed on and that a position relevant to the entire organisation must be formulated. This, specifically, should not only occur at the level of principles; it should also encompass practices. The development process caters for development at the different levels of complexity and is customised according to development needs. The process is set out below:

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Exceptional Effective Not yet effective

#6

Transition support

Exceptional

Gro

up

Effective

ma

nag

Not yet effective

er

Exceptional Effective Not yet effective

#4

ger

ana

em

pris

r Ente

ine

Bus

Fun

#5

ager

Validation

an ss m

Exceptional

ctio

nal

Exceptional Effective Not yet effective

Effective

ma

nag

Not yet effective

er

age

Man

#2

Learning and development

#3

gers

a man

Exceptional

Ma

nag

eo

Exceptional Effective Not yet effective

Effective

the

Not yet effective

rs

Pre-assessment

#1 elf ge s

a

Man

Figure 8: Leadership pipeline development process Adapted from The Leadership Pipeline by Drotter and Charan

The development content process could look as follows: Type 4 work Executive development Assessment & preparation of individual

Preparation of individual

Series of working sessions

Action learning 30–90 days Simulation/Work application

Series of working sessions

Review

Series of working sessions

Review

Series of working sessions

Review

Coaching Type 3 work Senior to middle management development Assessment & preparation of individual

Preparation of individual

Series of working sessions

Action learning 30–90 days Simulation/Work application

Coaching Type 2 work Junior to supervisor management development Assessment & preparation of individual

Preparation of individual

Series of working sessions

Action learning 30 days Simulation/Work application

Coaching Leadership competencies

Talent management system

Figure 9: Leadership development process

In your process mapping, consider the following:

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Toolkit item: Leadership development process •

Are you building capacity for the present or for the future?

•

Are you focusing on individuals in their current leadership roles, or are you catering for programmes where people move up one level in the leadership pipeline (transition programmes)?

•

Have you defined the process in terms of the participant, the line manager and the learning provider(s)?

As previously mentioned, leadership development links to your succession planning and other talent management approaches. Also, most organisations have limited resources and they just cannot develop everybody at once. So what now? You will find some of the answers as to where your emphasis should be placed, when answering the leadership capacity question, as outlined in the preceding chapter. In addition, the following questions can be asked: •

On what leadership roles/levels do you need to focus your leadership talent investment?

•

What criteria will you use to determine your investment?

•

Where do you have current leadership gaps or surpluses?

•

Will this picture look the same within three to five years?

Leadership development content The design of leadership development content should follow a blended approach, focusing on both formal and informal content. The figure below conceptually illustrates what we mean by blended learning:

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Companybased learning communities

Simulation Library

Coach/Mentor

Learner Classroom-based Internet Knowledge portal

Figure 10: Blended learning approach

Research has indicated that that there is congruence between what leaders and HR professionals report. The methods leaders perceive as the most effective are the same methods HR professionals rely on most often. For example, HR professionals rated formal workshops as the most used method, and 73 per cent of the leaders perceived this method as effective. Web-based and virtual classroom training methods fell short not because they are ineffective, but because many organisations use courses that are either not engaging or lack skillbuilding components. The DDI’s research has indicated that both Web-based and virtual classroom training show promise in terms of developing more effective leadership skills. To be effective, they require a combination of engaging design and built-in supplemental skill practice sessions. However, when we looked at the relationship between the use and effectiveness of each method, we found that organisations were ignoring other important leadership development methods. Organisations with more effective leadership development programmes tended to use four methods more often and more effectively: formal workshops, along with three types of coaching: managerial, internal and external. The majority of organisations utilise two of these methods successfully (formal workshops and managerial coaching), while neglecting the other two (internal and external coaching). Only 27 per cent utilise 60

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external coaches, while 39 per cent successfully use internal coaches to develop leaders. If organisations want to create more effective programmes, they should put more effort into utilising methods that have a greater impact on overall development, such as a variety of coaching methods. With this combined perspective, time, energy and resources for development can begin to shift to where the greatest potential for relevant learning and critical application lie, namely to where they can support learning through work, through the implementation of strategies and through efforts to adapt to unplanned change.

Formal content As a first step the leadership behaviours (as defined in the leadership framework) need to be translated into curriculum specifications by a group of experts on leadership development subject matter. Table 15: Formal programme structure

Dimension

Competencies

Development programme module

Orientation

N/A

• Personal branding • Leadership landscape

Interpersonal

• Communication • Emotional maturity • Integrity

• Engaging others

People leadership

• Engaging diversity • Highperformance teaming • Influencing others • Leading change

• Leading managers • External networking • Project management

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Dimension

Competencies

Development programme module

• Learning and knowledge networking • Organisational resilience • People management • Programme and project management Business leadership

• Acting strategically • Building capacity • Business acumen • Customer orientation • Integrity and values • Market orientation • Resource management • Risk management • Taking action • Thinking strategically

• Business process value chains • Translating strategy and implementing operational strategy • Financial management • Corporate governance

Particular attention needs to be paid to the technical quality of the modules being produced, so that aspects such as look and feel, and editing (amongst others) receive the required focus. The logic is simple: if leadership as a strategic initiative is so important, then everything we do should reflect this. 62

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Numerous organisations have begun to realise that the type of traditional, lecture-based classroom training associated with most formal leadership development programmes is ineffectual in preparing leaders for 21st-century problems. Significantly, the lessons learned from traditional classroom development programmes do not last much beyond the end of the programme. It is therefore important that the delivery allows for practical application and exploration in the classroom. This should not be a lecturing session. It should further be supported by the informal development content (something which does not, for one moment, imply that it is unstructured or unplanned). This results in what we call the ‘content and delivery specification’, as illustrated below: Table 16: Learning specifications Module Me PTY(Ltd)

Learning

Content

Delivery

outcomes

specification

method

• Consciously

Content must

• Assessment

follows a

settle around

• Personal

process

a structured

to gain an

process to help

understanding

individuals

of the self.

understand the

• Remains

following:

composed

• Current

in positive

level of

and negative situations. Shows a great deal of

development planning • Classroom based • Journaling

competence; • Future level of competence; • Dark side and

stability or

bright side of

consistency.

leadership;

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Module

64

Learning

Content

Delivery

outcomes

specification

method

Me PTY(Ltd) (Cont.)

• Deals constructively with criticism, displays resilience and fortitude in both positive and negative situations. • Displays empathy towards others/their causes.

• Identifying development needs – both strengths and weaknesses; • Optional: Making a transition to a next level of complexity.

Influencing, communicating and creating a purposeful organisation

• Defines core purpose and values and shapes the efforts of all in the business towards these. • Creates a climate where confidence and trust are engendered, to gain the involvement and commitment of others. • Promotes goodwill, builds legitimacy and credibility.

• Defines organisational purpose and values; communicates strategy, vision and values throughout the organisation. • Inspires and motivates people across the organisation. • Creates a climate where confidence and trust are engendered.

• Classroom based • Coaching • 360° feedback on progress • Journaling

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Leadership coaching The Leadership Development Coaching Approach describes internal and external coaching approaches as development solutions aimed at closing the gap between individual leadership competencies and the required current or future leadership competencies, as they pertain to specific leadership levels within an organisation.

Coaching equips people with the tools, knowledge and opportunities they need to develop themselves. It is an interactive relationship where both parties share responsibility for learning and development.

Your coaching approach should cover the whole extent of a coaching engagement, and should stipulate the ‘who’, ‘when’ and ‘how’. Toolkit item: Tips for leadership coaching •

Adopt a systematic approach to coaching;

•

Be conscious of your coaching skills and style, and the impact thereof;

•

Know what it takes for development to occur;

•

Build trusting coaching relationships;

•

Understand what is important to people;

•

Get people excited about development and growth;

•

Help people assess their competencies;

•

Help people identify their strengths and development areas;

•

Help people identify their development objectives;

•

Help people create effective developmental processes; 65

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•

Create an effective learning environment;

•

Be a strong role model for development;

•

Tailor coaching to each individual coachee;

•

Provide relevant and constructive feedback;

•

Equip people to receive useful feedback;

•

Use 360° or multi-rater feedback tools;

•

Provide challenging development activities and opportunities;

•

Show an interest in people’s careers;

•

Help individual leaders to keep to the development programme;

•

Address performance issues;

•

Help individual leaders learn from experience;

•

Recommend training programmes, readings and other resources;

•

Motivate others, allow everyone to help everyone else develop; and

•

Reinforce the leadership development process in your area.

Toolkit item: Coaching planner

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Table 17: Template: Coaching planner Date

Name: Leadership level: Job title: Coach:

ompetencles C Coaching objectives Coaching activities to develop

Target date

Leadership transition programmes While times of transition can be exciting and energising, they often prove difficult for both the leader (who has a new role) and for the followers ­(members of the organisation who experience changes in their environment). It is estimated that 41 per cent of new-to-role managers make smooth transitions into their new roles, according to survey responses from their managers. New leaders have a natural desire to make a unique contribution to the organisation and commonly feel the need to set themselves apart from a former leader. As a result, new leaders often appear to take a critical stance towards current organisational processes and policies. New leaders might, in an attempt to demonstrate their ability to contribute, offer suggestions or potential solutions for every issue that arises. However, leaders who are able to make a smooth transition into a new role will find that direct reports perform at a 15 per cent higher level and are 21 per cent more likely to stay, than the direct reports of struggling new-to-role managers. Leaders who fail cost a great deal in terms of money and resources. Research by the Corporate 67

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Leadership Council estimates the cost of leadership failure to be between $750,000 and $1,5 million per senior manager. As indicated in Figure 8: Leadership pipeline development process, not only should leadership development be done for current leadership roles, but also for transitioning purposes. A transition programme typically provides detailled guidance and specific action plans to help leaders to quickly make a positive impact in their new positions. The programme provides tools, resources and advice that leaders in new roles can immediately apply on the job. The leadership transition programme is about realising the opportunity to make a bigger impact in the future. It should broaden the participants’ scope of vision and the sphere of influence they cultivated in the past. The following are what we call ‘leadership shocks’, i.e. what happens when the level of complexity increases within a new leadership role. These elements need to be addressed in the leadership transition programme. Table 18: Leadership shocks

Transitioning to Type 2 work

Transitioning to Type 3 work

Transitioning to Type 4 work

• Learning the responsibility of having to manage the delivery of others, as well as performance problems.

• Experiencing the pressure and effort it takes to drive innovation and execute best practices.

• Moving out of the relative comfort and certainty of silos and needing to craft synergies between divisions and departments.

• Taking on the task of ensuring that team members adhere to and fulfil essential requirements and comply with set procedures and standards. 68

• Coming to terms with the fact that what appears to be a great idea is invariably shot down several times before it gains approval.

• Learning to cope with the natural anxiety of relinquishing areas of personal expertise and working with the paradoxes of strategy execution.

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Transitioning to Type 2 work

Transitioning to Type 3 work

• Experiencing the push back and initiation into the politics and dynamics of managing people.

• Learning to invest • Confronting the the often exquisite need to develop effort it takes to the constructive identify, prioritise, political and motivate, negotiation champion competencies and execute required to work best operating with and integrate practices. the contributions of people from • Overcoming different divisions, the tendency to and with varying feel attacked or interests and criticised when perspectives. more senior

• Being confronted with the need to apply people management and leadership skills for which there have often not been formal development.

Transitioning to Type 4 work

people and peers reject a proposal that a lot of work went into.

• Coping with the uncertainty • Experiencing the of delegating loneliness of the important leader for the first tasks to middle time. • Coping with managers and not the pressures of • Exerting authority intervening too developing and that is almost soon when things implementing certain to cause do not go exactly challenging conflict and be as planned. business plans and unpopular. • Accepting the budgets. • Learning inevitability of • Working with the to balance paradoxes and uncertainty of engagement with learning to live having to make staff to create with then. tactical choices an energising when there is environment, more than one while also obvious route to developing take. essential detachment.

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Informal development Below follows a conversation on several other approaches you may want to consider for leadership development. By referring to these as ‘informal’ we do not imply that such sessions are unplanned or unstructured. These approaches are all ways and means by which you can inculcate the leadership DNA in your organisation.

Learning portal Along with the processes already described, a leadership intranet website can be created for the leadership, as well as the wider leadership community. Content could include •

the leadership development strategy;

•

feedback from the leadership community;

•

development material such as articles, e-books (we call it the ‘Leadership Directory’);

•

course material from your formal programmes; and

•

blogs and leadership conversation rooms.

Leadership summit In keeping with the overall strategic intent of the leadership development strategy, you can also construct a deliberate process to facilitate strategic leadership conversations. These conversations can be organised as large group events with the top 100 leaders, with the express purpose of ensuring the alignment of leadership across divisions, chains and service departments. Based on our experience, it works best to decide beforehand that a leadership summit needs an encompassing theme, where each of the summits could constitute an ‘episode’ within a larger series or story. In addition, leadership summits should always illuminate the direct relationship between business strategy and leadership to participants.

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Table 19: Leadership summit design

Overall theme

Leadership landscape Topic

Session content

Event 1

Levels, roles and processes

1. Business overview 2. Leadership and business strategy 3. Input on levels, roles and processes 4. Facilitated workshop on levels and processes

Event 2

Leadership styles and modes

1. Business overview 2. Leadership and business strategy 3. Input on styles and modes 4. Facilitated workshop on styles and modes

Event 3

Leadership psycho-social dynamics

1. Business overview 2. Leadership and business strategy 3. Input on psycho-social dynamics 4. Facilitated workshop on psycho-social dynamics

Breakfast conversations Partly because you may feel that you need a process to extend awareness about the approach to leadership beyond the top 100, you can also construct a series of breakfast conversations. Given the design of the leadership summit, as outlined above, it is a fairly simple matter to design breakfast conversation sessions. All that is really required, is to •

condense each of the summit events to a two-hour event; and

•

provide the session coordinators with guidelines on what to do. 71

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Clearly, the summit attendees would be the individuals taking back the message of each summit to their own divisions, chains or service departments, by having similar breakfast sessions with their respective leadership teams. It is usually best to leave the specific format of such sessions to the discretion of the individual teams.

Rotation/Expanded role Rotation is about taking on a new project assignment in a new department or role. This may form part of a formal job rotation programme and/or rotation outside the organisation with strategic partners or suppliers. An expanded role is when the scope of the current role is broadened to include new tasks or activities.

Action learning When managers and executives are asked to describe key developmental experiences in their careers, 50–70% of the experiences they describe are challenges encountered in their assignments at work. – Cynthia McCauley Work assignments are often overlooked as an opportunity to help leaders develop specific competencies or practise key behaviours. To enhance the focus on learning from work assignments, it is important to have specific goals, opportunities to receive feedback on progress, and a coach (we sometimes call them ‘learning guides’, to distinguish this from the more formal leadership coaching approach) with whom to discuss learning strategies. Although the business imperatives behind action learning programmes may vary widely across applications, there are common catalysts underlying their successes. The idea is to create a temporary system that is realistic, yet safe. People are encouraged to explore and try new ways of doing things. In addition, action must be accompanied by reflection about the action, otherwise there is little structured guidance for learning from experience. 72

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Examples of action learning Below are examples of action learning assignments that can be utilised to develop leaders. You will note that we define projects/ assignments/on-the-job activities according to a perspective of complexity. Table 20: Action learning assignment

Leadership competency

Level of complexity

Action learning assignment

Influencing

Supervisory level

Represent concerns of employees to higher management.

Developing others

Supervisory level

Coach an employee with performance problems

Personal mastery

Management level

Seek feedback from others about the extent to which you demonstrate your trust. Also ask these individuals what the behaviours are that demonstrate trust to them, so that you can have an idea of which behaviours to develop.

Business results

Management level

Manage projects that require coordination across functions/departments.

Strategic thinking

Management level

Translate the organisational strategy into operational goals and performance standards. Design your communication plan to convey these to your team and share this with your manager/coach to evaluate the soundness of your plan. 73

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Business simulations Business simulations offer another version of action learning that can be effective in creating the kind of simulated workplace that enhances individual development. The primary difference is that simulations further compress the time and space allotted to solve a fundamental business problem. Once again, it is important to remember that your simulation must replicate the required level of complexity. As can be seen from this chapter, the implementation of the various initiatives in the leadership development space will require significant attention to detail. In essence, what we suggest is an integrated leadership excellence development model, as outlined in the next section.

Integrated leadership excellence development model This inclusive process is cascaded through the business at many levels, by means of the following:

74

•

Formal leadership programmes: A series of interventions designed to support the development of leadership capability and capacity within the organisation.

•

Leadership summits: Sessions that allow the broader grouping of your leadership to meet at regular intervals to ensure that they keep driving leadership excellence in support of your business strategy.

•

Breakfast sessions for Exco: More informal gatherings, allowing leaders to convene in a small group to have progressive conversations about leadership and what is required within your organisational context. In this way you build a leadership community.

•

Breakfast sessions for leaders: In order to expand the leadership conversations and community, informal breakfast sessions (similar to the conversations held at Exco level) can be held between Exco members and their line managers.

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•

Monthly communication sessions: These are monthly updates in your Exco or management meetings, where a regular agenda item will allow for robust two-way conversations about leadership within your area of expertise. Feedback from these sessions should be taken into consideration as you continue to design and develop integrated, tailor-made leadership development interventions.

•

Change management and communication functions: These should provide ongoing support to all the above-mentioned interventions.

•

Action learning: This ought to provide on-the-job application learning.

•

The learning portal: This provides the space where content is hosted; it fosters online collaboration sessions.

Conclusion A well-thought-through leadership capacity-building strategy will return benefits at individual, team and organisational level that simply cannot be achieved by assembling off-the-shelf programmatic components, no matter how excellent the content or the facilitator. While shortcuts may appear to save time and money, in the long run they constitute a poor investment because they cannot build the desired organisational leadership brand. Leadership development activities must reflect the level of complexity within which the guidance takes place, and not simply change the mindset or competencies of individual leaders. Leadership capacity building is where you reshape the organisational leadership DNA.

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CHAPTER 5 LEADERSHIP GOVERNANCE In this shorter chapter we concentrate on the Leadership Strategy Governance Model. Clearly, this is an area that should be viewed within the broader framework of your organisation’s specific approach to governance, as embodied in various management structures and committees, delegated authorities, and so forth. What this chapter proposes, though, is that the leadership strategy should be governed in a manner similar to any other business strategy and/ or business investment.

Governance approach Formally defined, leadership strategy governance is about ensuring and enabling your organisation to conduct its business with respect to the leadership brand in an ethical, legitimate, fair and credible manner. Governance with respect to the leadership brand is the act of leading the leadership brand building-block activities and managing its related investments in such a way as to • align the leadership development and assessment priorities with those of the business; • optimise the performance of the organisation’s leadership assets; • establish and maintain sustainable relationships with stakeholders; • fulfil fiduciary and financial responsibilities; • mitigate risk; and • enable effective and consistent executive decision making. 77

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Principles Sound leadership brand governance needs to be based on at least the following governance principles: •

Effective checks and balances on decision-making processes and decisions;

•

Socially responsible and ethical conduct;

•

Acting with integrity;

•

Acknowledging all stakeholders and treating them, jointly and severally, in a fair, equitable and balanced manner;

•

Transparency with respect to management actions and their impact;

•

Taking responsibility and being accountable for own actions;

•

Displaying proper stewardship with respect to the assets entrusted to management; and

•

Reporting, in a comprehensive and integrated manner, on the value add and the organisation’s actions as well as decisions by its leadership.

Role-player analysis Using a table similar to the following one, consider, for each aspect of the leadership strategy, ­ who the key role players in your organisation are, and what their specific accountabilities should be. Toolkit item: Role-player analysis

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Table 21: Template: Role-player analysis

Leadership strategy elements

Role players CEO

HR

Line management

Provider

Leadership brand Leadership framework Leadership assessment Leadership development Impact assessment

Leadership assessment and development governance considerations For leadership assessment and development to occur in a planned and results-driven manner, due consideration has to be given to how the process is governed. The table below outlines the key issues involved.

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Table 22: Leadership assessment and development governance issues

Dimension

Specific implication

Scope

In determining the scope of the document, the following points should be considered: • • • • • • •

Decision makers

Key decision makers at various levels are to be defined. Some of the relevant areas are: • • •

•

Criteria

Career pathing and succession planning; Establishment of talent councils; Ownership of the curriculum and the required outcomes of training and development input; and Leadership development (a balanced approach between capability and performance).

The principles and criteria for the programme need to be defined, including: •

• • • • •

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The purpose and scope of the programme; Who will be affected; Definition of a talent council (authority, accountability, objectives); Roles and responsibilities; Processes and procedures; Controls and ownership; and Resourcing: finances and people.

Selection criteria at all levels: who is eligible for participation in which development programmes; How selection is done; Validity periods and weighting of assessments; Development opportunities available versus those specified; Good performance should be a predominant philosophy; and Define and differentiate types of talent.

CHAPTER 5: LEADERSHIP GOVERNANCE

Dimension

Specific implication

Process

Throughout the process, all participants should be left with the feeling that they had an incredible experience. The full process will be defined and will cover, amongst others, the following considerations: • • • • • • •

Controls

What happens if the selection criteria are not met? Who provides assessment feedback and when? How do EE and BBEEE impact on talent selection? Feedback processes and methodology; Defining processes and reporting channels for the talent council; Determining the depth and breadth of succession planning; and Ensuring that internal and external applicants follow the same assessment processes, and receive feedback.

Ensuring that appropriate protocols are in place to cover the following: • • • • • • • •

Assessments: type, scope, methodology and feedback; Dispute resolution; Access to and governance of the succession plan; Compilation of final assessment battery; Timing of re-assessments after interventions; Review and appeal processes; Record keeping; Assessment consent;

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Dimension

Specific implication • • • • • •

The protocol protecting individuals from being ‘labelled’ in terms of feedback; Feedback processes and protocols; Legislative compliance in regard to EEA, LRA (procedural issues); Protocol on compiling a final assessment battery; The use of subject matter experts to conduct assessments; and Sign-off required.

Other leadership strategy governance matters There are a few specific issues that you may also want to consider from a leadership strategy perspective: •

Who owns leadership?

•

Who pays for the execution of leadership strategy aspects?

•

How does leadership strategy integrate with broader talent management processes?

Although these questions may, on the surface, appear very simple, in our experience they often require some fairly complex decisions to be taken. Use the table below to record your thoughts on the following: Table 23: Leadership-related questions

Pertaining to executive leaders: Who has the final decision about what assessment and development programmes they participate in? Pertaining to senior leaders: Who has the final decision about what assessment and development programmes they participate in?

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Pertaining to management level leaders: Who has the final decision about what assessment and development programmes they participate in? Pertaining to supervisory leaders: Who has the final decision about what assessment and development programmes they participate in? Shall we have a central budget for leadership assessment and development, or will various areas in the business be required to budget for this themselves? Who will set up budget parameters? Who will decide on the budget allocation for the assessment and development of each leader? What will be the consequence if leadership assessment and development are not executed as planned? Will this form part of our performance contracting and management process? Who will manage the relationship with assessment and development providers? Can management in each area of the business do what they think best, or will there be a centrally determined approach? Who will ‘own’ assessment results? How do we ensure the privacy of individuals, compliance with various legal and statutory requirements, and at the same time ensure business value from assessments? 83

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Who signs off on leadership development programmes as regards content? How will leadership development be integrated with other talent management processes? Is it part of our succession process? Do we use it to create talent pools? Is it a requirement for promotion? Particularly at lower levels, how is leadership development integrated with other forms of training?

Conclusion Leadership strategy governance is simultaneously very simple and very complex. In essence, the type of issues to be addressed focuses on the following: •

Who defines the leadership brand?

•

Who defines leadership assessment and development processes?

•

Who defines how we determine whether our leadership strategy is successful?

•

Who decides on budget and how it is employed?

•

Who ensures that the strategy is linked to the business and people focus areas of the organisation?

At some level, and based entirely on where we have seen leadership strategy adding business value compared to where it does not, the one key principle seems to be that executive ownership and sponsorship are non-negotiable.

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CHAPTER 6 BENEFIT REALISATION In this chapter we concentrate on how to measure benefit realisation. Providing realistic and usable measures for benefit realisation is not necessarily straightforward. Benefits may be owned by different parts of the organisation or different parts of the same discipline, such as the Human Capital Function. Some benefits can be tracked by using financial measures, while others require more complex measures or indicators to illustrate their realisation.

Measurement approach It may be appropriate to offer a word of caution at this early stage. As Einstein stated: “Not everything that counts can be counted. Not everything that is counted counts.” From a leadership development perspective, this may indeed be particularly true! From a leadership development strategy perspective, the final and arguably most important element is putting in place the appropriate impact measurements. In simple terms, we need to be able to provide evidence that our leadership development strategy is delivering on our leadership development vision. As is shown in the following figure, assessing leadership development impact is based on an assessment of business results.

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Leadership development strategy

Business results

Leadership capacity

Figure 11: Leadership strategy metrics

In this context, the term ‘business results’ refers to a range of outcomes that go beyond financial returns. The Kirkpatrick and Phillips approaches are possibly the best known, particularly from a business perspective. In essence, these two approaches are very similar, with Phillips adding a fifth dimension called ‘Return on investment’. (The Kirkpatrick approach already caters for the dimensions: reaction, learning, behaviour and results.) Key principles to take into consideration for the measurement are: •

Keep the measurement model as simple as possible;

•

The model should include perspectives on all the key elements of leadership development;

•

The model should include both quantitative and qualitative measures; and

•

Measurement should also drive personal ownership by participants.

When considering any kind of measurement, from a high-level perspective it can be stated that

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•

the underlying purpose of measurement needs to be agreed on beforehand;

•

an appropriate model has to be selected; and

•

the interests of different stakeholders need to be considered.

In addition, due consideration needs to be given to how the measurement approach will link to the leadership development governance system, and how it will apply to the entire solution (process and content).

Matrix of metrics The suggested outlines of the various metrics/key performance indicators (KPIs) proposed for leadership development are summarised in the following table: Toolkit item: Matrix of metrics Table 24: Matrix of metrics Domain Area Segment Organisation Metric Purpose Indicator (KPI)

Data /Tool

Individual Metric Purpose Indicator (KPI)

Data / Tool

Links)

Below follows a more detailled description of the different elements listed in the matrix of metrics:

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Table 25: Elements of the matrix of metrics

Domain

Conceptually, the domain of measurement for leadership development can be classified into two broad areas, namely • the leadership development strategy itself, including its various components; and • the measurement of the actual deliverables of the strategy. Examples of the actual deliverables of the leadership development strategy that can be measured include, for example, • leadership brand; • business performance; • organisational culture; and • leadership effectiveness. Examples of the measures for the components of the leadership development strategy include, for example, • strategic relevance; • leadership bench strength; • leadership development process efficiency; and • benchmarking of leadership development learning content. Another perspective on these two domains suggests that the measures for components of the strategy are leading indicators for the end result measures.

Area

Within each of the measurement domains there are a number of areas that can be measured. The following areas can be measured to determine the end results of the leadership development strategy: • Leadership reputation; • Financial performance of the organisation; • Organisational culture; and • Value generation (ROI).

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Area (Cont.)

For measuring the leadership development strategy, these areas could be measured: • External programme benchmarks; • Leadership bench strength; • Development time and cost; and • Talent management metrics.

Segment

Not all leadership development metrics (KPIs) are necessarily appropriate to all levels or sub-groupings of leaders. The segment to which a specific metric applies must therefore be defined accurately.

Metric (KPI)

This is the specific element of leadership development that is to be measured. It can be linked to any aspect of the entire strategy, such as governance, architecture, process, content and so forth.

Purpose

As with any other form of business metrics, it is important to decide in advance what the purpose would be of measuring a particular aspect of leadership development. Do you wish to • determine the return on investment? • assess the value add of learning content/ providers? • review the impact on culture, etc? Clearly, the purpose of the various metrics is also directly related to the role of the individual responsible for such a metric. The organisation’s board would be interested in certain metrics, whereas the Leadership Development and Training Function may be interested in a very different set of metrics.

Indicator

Indicators are the specific evidence of the metric. An indicator of leadership bench strength (metric/ KPI) may, for example, be the number of internal promotions (indicator).

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Data / tool

From a very practical perspective, it is also important to consider the data and/or toolset needed to generate the information required by an indicator. For example, should you wish to introduce ‘Number of approaches by external companies’ as an indicator of the metric ‘Leadership brand’, you need to ask how you can obtain this information, and whether it can be done reliably and legitimately.

Links

This field will simply indicate whether or not a particular metric is related to either the governance process and/or talent management overall.

Metrics (KPIs) application From the perspective of leadership development, the key issue regarding the application of metrics (KPIs) is to revisit the purpose statement of leadership development per se, as well as those formulated for each of the various metrics.

Domains of metrics From an overall perspective, it is suggested that the metrics associated with leadership development could be positioned in one of three domains, as illustrated in the figure below: Leadership development strategy

Business results

Figure 12: Metrics domains

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Leadership capacity

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The metrics argument, based on the figure above, is the following: •

The leadership development strategy drives the enhancement of leadership capacity; and

•

Improved leadership capacity drives improved business results.

Proposed scorecard segments, metrics and indicators Leadership Development Strategy

Philosophy

Architecture

Governance

Development solutions Process

Content

Outcome

Leadership capacity

Landscape

Culture

Pipeline

Business value add

Strategic

Tactical

Operational

Execution

Figure 13: Metrics scorecard

As can be seen from the above figure, the leadership development strategy specifically refers to the philosophy, architecture and governance processes that inform and contextualise leadership development solutions. The figure clearly shows the close relationship between metrics and all other elements of the process. Each of the scorecard logic elements outlined above will now be unpacked in detail.

Leadership development solutions The following table shows the proposed metrics and measurements for leadership development solutions, i.e. the degree to which the solutions are effective and efficient. The degree to which these are feasible in your organisation needs to be verified, as we are not in a position to determine whether the various data elements currently 91

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exist, and whether or not the systems support is in place to generate them. Table 26: Solutions metrics LEADERSHIP DEVELOPMENT SOLUTIONS Dimension

Example metric

Example measurement

•

Benchmark of component costs against best practice Cycle time per value chain component Data integrity

Assessment cost per person/Average assessment cost per person for best practice benchmark

Process Value chain efficiency

•

•

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Completeness of leadership development solutions

•

Degree to which development needs can be addressed

•

Number of development requests outside of the offering

Solution parameter compliance

•

Number of leaders per segment with documented PDPs

•

Number of leaders with documented PDPs per segment/ Number of leaders per segment * 100

Cost

•

Direct cost of training per person per training day

•

Total training spend / (# of trainees * # of training days attended)

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LEADERSHIP DEVELOPMENT SOLUTIONS Dimension

Example metric

Example measurement

Flexibility

•

E-Learning abandonment rate

•

•

Program abandonment rate

•

•

Leadership development cost as percentage of total training spend

•

Leadership development spend/Total training spend *100

•

Program evaluation by experts Benchmarking ranking

•

Number of modules with formal recognition

Best practice

E-Learning courses abandoned/ E-Learning courses initiated *100 Number of participants abandoning a program/Number of participants entered *100

Content Relevance

• Outcome Participant participation

Development programme penetration rate per segment

Number of participants/End of period headcount of eligible participants per segment*100

Participant reaction

•

Participant satisfaction

•

Survey results

Competence development

•

Employee satisfaction with leadership

•

Survey results/ LEA

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LEADERSHIP DEVELOPMENT SOLUTIONS Dimension

Workplace impact

Perceptions of leadership development

Example metric

Example measurement

•

Leadership competence profile shift

•

Mean leadership profile rating post development / Mean leadership profile rating pre development *100

•

Individual performance improvement

•

Average performance rating post development / Average performance rating pre development *100

•

Leadership competence profile 360°

•

Survey results

•

Degree to which we are seen as an industry benchmark

•

Survey results

Leadership capacity The following table shows example metrics and measurements for leadership capacity, i.e. the degree to which the leadership development solutions in fact contribute to improved leadership capacity.

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Table 27: Capacity metrics

LEADERSHIP CAPACITY Dimension

Example metric

Example measurement

Race distribution per leadership segment

# of black leaders per segment / # of leaders per segment *100

Number of key positions with ready candidates

# of key positions with ready candidates/Total number of key positions *100

Age distribution per leadership segment

% of leaders per age category per segment

Leadership style

Employee satisfaction with leadership

Survey results

Leadership Effectiveness

Leadership effectiveness questionnaire

Survey results

Levels of employee engagement

Survey results

Number of leaders ready for promotion/transfer to key leadership positions

Promotion of leaders/ Internal movement of leaders*100

Cross functional mobility of leaders

Internal movement of leaders across functions/Internal movement of leaders * 100

Landscape Demographic profile

Culture Employee engagement Pipeline Critical leadership role coverage

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LEADERSHIP CAPACITY Dimension

Example metric

Example measurement

Critical leadership role coverage (Cont.)

Ability to recruit from within

Number of leadership positions filled internally/Number of leadership positions filled*100

HIPO profile

Percentage of leaders rated as HIPO; HIPO pool growth rate

Number of leaders rated HIPO on 9-Box/Total number of leaders (Headcount HIPO Pool - HIPO Headcount previous year)/ HIPO Headcount previous year * 100

Business value add The following table shows the proposed metrics and measurements for the business value-add level of leadership development. An improvement in these metrics can arguably be attributed to the sustained effectiveness and efficiency of leadership development solutions to enhance leadership capacity. Table 28: Value-add metrics BUSINESS VALUE ADD  

STRATEGIC TACTICAL

OPERA-

EXECUTION

TIONAL Financial

• Profitability • Revenue

• Budget

• Productivity

compliance  

• Revenue

 

 

 

 

per employee • Growth

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• Cost

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BUSINESS VALUE ADD  

STRATEGIC TACTICAL

OPERA-

EXECUTION

TIONAL Customer

• Stakeholder • Customer perceptions

Efficiencies • Technical

satisfaction • Best

reputation  

excellence

• Work quality

• Process

• Reduced

practice

compli-

wastage

benchmarks

ance

 

 

• Service

• Learning

 

• Improved

adoption

safety

curve

standards

• Reduction • Reduced in down-

rework

time Learning

• Rate of innovation

• Talent

• Team de-

profile

velopment

• Employee skill levels

Conclusion measuring the value add of your leadership approach could be very daunting. In the Lewis Caroll book Alice’s adventures in Wonderland, the following conversation occurs between Alice and the Cat: “Would you tell me, please, which way I ought to go from here?” “That depends a good deal on where you want to get to,” said the Cat. “I don’t much care where—” said Alice. “Then it doesn’t matter which way you go,” said the Cat. “--so long as I get SOMEWHERE,” Alice added as an explanation. “Oh, you’re sure to do that,” said the Cat, “if you only walk long enough.”

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It is important to be clear on the objectives from the start. Be very clear on what you want to measure and why.

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CHAPTER 7 LESSONS LEARNT This chapter is certainly not the final word on the leadership development work we have embarked on with clients and partners over the past 15 years. The lessons learnt are always a mix of the old and the new, and we suspect this pattern will not change. The key point is simply that as you embark on your leadership strategy, you should regularly take the time to reflect on what you have learnt so that you can use what works. In this sense, leadership strategy is no different from any other type of business strategy – you need to continuously and deliberately reflect on the journey, to proactively adjust your thoughts and actions in order to remain relevant and meaningful.

Business lessons In reflecting on our leadership strategy work with clients, the following were some of the key lessons we learnt: •

Not all organisations are ready for the development and implementation of a strategic perspective on leadership;

•

If you do not have executive sponsorship for the process you will not succeed;

•

The implementation of a leadership strategy is time consuming and costs money – if the organisation cannot or will not provide adequate resources (time, people, money), it will not succeed;

•

Linking leadership strategy to business value is important from a legitimacy perspective (and makes it easier for line leadership to buy into the process); 99

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•

Leadership strategy ­which is well defined and executed adds to business success in obvious ways (many of our clients can substantiate this); and

•

Leadership strategy cannot be outsourced, although obviously elements of practical implementation can and should be.

Leadership lessons The more academic section of this field guide (Chapters 8 and 9) will explain some of the transitions in leadership thinking, philosophy and practice in detail. We have no doubt, based on our learning from clients, that a fundamental shift in leadership practice is part and parcel of the way businesses need to adjust to changing social, political and economic circumstances. Some of our key conclusions follow: •

There is an increasing demand for leadership to focus on the spiritual (purpose) dimensions of business, in addition to the transactional and transformational work leaders are familiar with;

•

Leadership indeed exists at all levels – we have met truly remarkable leaders, amongst our clients, who represented all levels of the organisation;

•

Leadership is very personal. As much as you can learn about leadership from other organisations and individuals (and programmes), you still have to make it your own; and

•

Leadership strategy therefore demands an interesting and fine balance between organisational philosophies and practices, and individual authenticity. Alignment around a leadership brand cannot (and should not) be a cloning of simple sets of behaviours.

Professional lessons You are not going to do this on your own! The corollary of this is also very simple: be very careful whom you choose as partners. We 100

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also had to learn – sometimes the hard way – that the people we considered to be competent and trustworthy were simply not up to the standard required for a particular project. As a consultant (internal and external to the organisation), you should understand the difference between being a trusted advisor, a technical or subject matter expert, and a resource. These roles often merge and overlap on a project such as this, but they each require a very different approach to the client system. There is no substitute for professionalism in everything you do. Whether you are having a strategic conversation or designing course material, you simply have to ensure that what you do is strategically relevant, that you apply best practice, deliver service excellence and ensure that there is no compromise on quality. There is no such thing as ‘good enough’! Clarify the exact parameters of the engagement from the outset. In our case, this was done by explicitly agreeing on the purpose, process and content of everything we did. This also allowed us to focus on what really would add value for the client, rather than doing things simply because it is part of our knowledge base. In building success you must be able to •

base everything you do on sound research;

•

design solutions specific to the client, rather than introducing ‘off-the-shelf’ content;

•

reduce complexity without becoming simplistic; and

•

go the extra mile, not because you want to impress the client, but because you want to serve with excellence.

Personal lessons As the facilitator of processes such as these, know who you are. There will be times when you have to make judgement calls on what is best for the client, and this may not necessarily be aligned to your personal values and beliefs. 101

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Remain humble. You may have specific knowledge, experience and expertise, but there are always people around you who know more about certain things. Don’t be afraid to say: “I don’t know.” Put the client above your own ego. Model the way. In every single interaction you need to remind the organisation of its philosophical assumptions and strategic intent. They know what they want and where they are going – they just need guidance (and the occasional prod!) on HOW to go about it.

Conclusion Leadership strategy is a process, and in varying degrees our clients have all shown the ability to take both a strategic long view on the process and a strong implementation orientation in the short term. We would like to thank all our clients and their outstanding leaders for allowing us to journey with them.

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CHAPTER 8 THE CHANGING WORLD OF WORK In the next chapters we provide you with certain theoretical constructs on which our work is built. This is an extract from our book: Reshaping leadership DNA. In order to clarify the organisational perspective and its future challenges, this specific chapter explores the evolution of organisational theory and concludes with an exploration of the paradigm and supporting philosophies of the future organisation. During the early years of organisational theory development, two main approaches, namely the classical and the neo-classical, were prevalent. These two approaches are discussed in terms of a general overview, a critique of each approach, and the impact of the approach on management theory and practices.

The classical approach The classical perspective, which sought to make organisations run like well-oiled machines, to a large extent remains the basis of modern management thinking and practises, and can be divided into two sub-fields: scientific management and administrative principles (Daft, 2001: 12). Taylor (1903) pioneered the scientific approach which posits that decisions about organisations and job design should be based on the precise, scientific study of individual situations. The scientific management approach focuses primarily on the core of the organisation, whereas administrative principles pertain to the design and functioning of the organisation as a whole (Daft, 2001: 13).

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Two researchers, Fayol and Taylor, contributed significantly to the ideas proposed by organisational theory. Fayol built on the management principles of Taylor by developing the concept of the systematisation of organisational procedures (Wilson, Goodall and Waagen, 1986: 28). His theory states that to be effective, management should be founded on a well-defined hierarchy of authority. Discipline is defined by the interpretation of the leaders and it is expected that interpersonal relationships should be impersonal (Naranyanan and Nath, 1993: 31). Weber (quoted in Wilson, et al. 1986) argues that the capitalistic system (which fundamentally comprises administrative principles) contributed to the rise and development of bureaucracy, which literally means government by bureau or agency. This he sees as impersonal and entirely hierarchical. Organisations operate as machines, with each cog in the system fulfilling a clearly defined role (Peters, 2001). This bureaucratic model, built on unquestioning loyalty, has become the organisational role model. Narayanan and Nath (1993: 32–33) are of the opinion that the theories developed during this period reflect dominant cultural assumptions. First, the assumption of rationality guided Taylor and his associates in their search for the ‘one right way’. Second, employees are viewed as inert instruments, and, lastly, these theories assume that environments and markets are known and stable. It is clear that this approach is based on the argument that order, rational choice and intentional capability govern the practise of decision-making in the world. Daft (2001: 13) puts forward the argument that the hierarchical system and bureaucratic approaches, which functioned well into the 1970s and 1980s, are no longer relevant to the modern organisation. Leavitt (2003) offers a reality check by stating that hierarchy remains the basic structure of most (if not all) large, ongoing human organisations. Hierarchies persist because they deliver real practical and psychological value, and they fulfil a deep human need for order and security. Despite the security they may provide, however, hierarchies are inevitably authoritarian. Leavitt (2003) postulates that when authoritarian problems occur in hierarchies they have the 104

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potential to corrupt the hierarchy, which becomes stagnant while informal groups multiply.

The neo-classical approach The period following the era of scientific management and administrative theories witnessed drastic changes in the environment and in how people viewed their own behaviour (Narayanan and Nath, 1993: 33). Mechanisation rapidly replaced human effort and communication, and transport systems improved – something which brought people together on a larger scale than before. At the same time the population kept growing, and unions and strikes began to manifest. These issues were further complicated by the world-wide depression in 1933, which was characterised by unemployment and low morale. A major breakthrough in terms of human relations occurred with a series of experiments (at a Chicago-based electrical company) which became known as the Hawthorne Studies. The publication of these findings led to a revolution in worker treatment and laid the groundwork for human relations and behavioural approaches (Daft, 2001: 13) known as the neo-classical approach or the human relations model. This change in thinking at that time is clear from Barnard’s (1938: 42) belief that a formal organisation corresponds to its people’s “reasoned and calculated actions and policies”. A formal organisation is a conscious structure, designed to reconcile the opposing forces of specialisation and coordination. The organisation does so by using rules, policies, record-keeping and standardised personnel practices (Barnard, 1938). The neo-classicists tried to compensate for the limitations of classical theory by modifying it with insights from the behavioural sciences. The human movement did not so much attempt to change classical theory as it tried to make it ‘fit’ the realities of human behaviour in organisations (Scott, et al. 1981: 40).

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Concluding remarks The late 1960s and early 1970s bought the realisation that the classical approach is only valid for certain organisations, and the concepts of the neo-classical approach only apply to a limited section of organisations (Rogers and Argarwala-Rogers, 1976: 48). The conventional way of doing organisational analysis ignores the nature of social life, along with the tendency to exclude the manner in which the world is socially constructed and constrained (Silverman, 1979: 218–219). The imperative of interdependency, the necessity of reducing complexity and the need to introduce manageable simplicity requires a different mode of thinking – a holistic frame of reference (Gharajedaghi, 1999). The need for a ‘new’ way of thinking about organisations was born, as expressed in the 1990s’ view on organisations, which defines an organisation as “many people organised in their efforts to deliver a product or service in order to benefit those contributing effort through quality of life, meaningful work, a sense of community and financial compensation, and to benefit the communities where it exists directly” (Morgan, 1993: 15). The following section focuses on the more modern approaches.

The modern approaches In the late 1950s, the necessity of reducing complexity and the realisation that organisations are not similar in nature, required a different mode of thinking. The aim of this section is to discuss the changing thinking in organisational theory that began to occur roughly in the 1950s, when organisations were conceptualised as interrelated systems. Seiler (1982), Baudhein and Schuelke (1982: 18) and Katz and Kahn (1966) were amongst the first to apply general systems theory to organisations. This was made popular in the 1990s by Senge (1990) with his book entitled The Fifth Discipline: The Art and Practise of the Learning Organisation. Theories on organisations as systems also evolved to cater for aspects like chaos, complexity and contingency, as will be discussed further from an organisational perspective. 106

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Organisations as natural systems The view of organisations as natural organic systems, emphasising commonalities among organisations and other social systems, can be traced back to the work of social theorists like Rousseau, Proudon, Burke and Durkheim (Scott, 1992: 72). Scott (1992: 75) argues that organisations, as natural systems, evolve and develop through natural growth and are characterised by spontaneity. This systems model is rooted in an ideology that emphasises openness to the environment, holistic thinking, the recognition of patterns, synthesis, an appreciation of an organisation as a living entity and a departure from the search for single, optimal solutions.

Organisations as open, social systems Ackoff (1994) defines an organisation as a social system. What distinguishes organisations from other social systems (a committee, a church) is the different ways in which it uses communication to arrive at decisions (Luhmann, 1986). Organisations maintain their existence through an on-going process of decision-making, continually establishing their own identity while distinguishing themselves from their environment. This is exemplified in Senge’s (1990) description of systems archetypes and feedback loops. Luhmann’s (1984: 191) theory (quoted in Beyes, 2003: 11) on organisations as social systems is grounded on instability and the constant reduction of complexity to maintain the system’s identity, in differentiating it from the environment. Beyes (2003) further argues that gains in clarity and distinctness go hand in hand with losses in variety. The attribution of action and the casual causal effects of actions contribute to the decrease in complexity and conceal the reality of the much ‘richer’ system. An organisation continuously describes itself as a system of actions in order to observe itself (and to be observed), and to control its growth. The notion of levels of systems that vary both in terms of the complexity of their parts and in the nature of the relationship between the parts, has been fully elaborated by Boulding (1956: 200–207), who 107

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identified nine levels of systems. Miller (1978), by contrast, identified seven basic levels. The work of both Miller and Boulding suggests that as systems become more complex they tend to become more loosely coupled, more dependent on information flow, more capable of self-maintenance and more able to grow and change. Theorists such as Buckley (1967: 50), Pondy and Mitroff (1979) and Verwey and Verwey (2003: 77) view organisations as open social systems that are constantly in interaction with a broader society, simultaneously shaping and being shaped by broader social forces. The system’s survival is dependent on its participants contributing their resources, time and energy. It also implies that an open system has boundaries and must expend energy on boundary maintenance. Organisations as open systems (referred to above) have boundaries. Miller and Miller (1992: 26) define a system boundary as the region of increased density surrounding a system. The purpose of the boundary is to (1) act as a barrier to flows of input into and out of the system; and (2) function as a selective filter that protects the system. In conclusion, viewing organisations as a social system implies that certain characteristics are present. The following is adapted from the work of Ackoff (1994):

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•

Organisations are a purposeful association of autonomous members;

•

Members serve themselves, their associates, environment through feedback and development;

•

Organisations are chosen structures that are multiform and can be recreated;

•

They are designed and chosen with culture and world view in mind;

•

They are open systems, where stakeholders have an interactive influence on the environment;

•

They imply the presence of learning, development and omnicompetence;

and

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•

They provide for interactive participative planning and idealised redesign.

A contingency approach to organisations Lawrence and Lorsch (1967), who coined the phrase ‘contingency theory’, argue that different environments require different things from organisations – especially when the environment is characterised by uncertainty and rapid changes in market conditions and technology. When analysing the literature on organisational contingency theory (Gailbraith, 1973; Williamson, 1985; Scott, et al. 1992), four descriptive themes emerge: •

There is no one best way in which to organise;

•

All the ways of organising are not equally effective;

•

The best way to organise depends on the nature of the environment to which the organisation relates; and

•

The form of the organisation does matter.

Stratified systems theory (SST) The purpose of this section is to discuss the implications of SST, developed by Elliott Jaques, for organisational design, form and function. The implications of levels of complexity for leadership within organisations are discussed later on in this chapter. Jaques first introduced the concept of the requisite organisation and SST in 1989, in his book Requisite organisation. He defined the term ‘requisite organisation’ as “doing business with efficiency, and competitiveness, and the release of human imagination, trust and satisfaction in work” (Jaques, 1996: 2). Essentially, the stratified systems framework suggests a general model of organisational functioning, such as that there are increasingly complex critical tasks or requirements at each organisational level. The increasing task

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complexity is a result of the uncertainties created by the need to deal with a more encompassing and turbulent environment (Hunt, 1996: 15). Jaques (1996) suggests that it is not a new type of organisation that is needed, but rather the understanding that organisations operate as “managerial accountability hierarchies” (MAHs). The MAH is often pejoratively referred to as a bureaucracy, but being a human institution, the potential exists that it could be marvellously creative. The basic stratified approach argues that the maximum number of organisational levels needed (in the organisation to which it is applied), should not exceed seven. The following is a summary of the levels based on Jacobs and Jaques (1987); Jaques (1989) and Jaques (1996): Table 29: Stratified systems theory

Level

Level of task complexity

Domain

VII

Construct complex systems

VI

Oversee complex systems

Unbounded open systems

V

Judge downstream consequences

IV

Parallel process multiple paths

III

Create alternative pathways

II

Diagnose accumulation

I

Overcome obstacles

Bounded open systems (subsystems) Direct production within the context of the larger system

Make a practical judgement This table shows that the level of task complexity increases at different organisational levels. Level I work is concerned with the hands-on practical elements of work, whereas Level VII focuses on tasks related to the construction of systems. Olivier (2003: 32) adds an essential task dimension to the original theory of Jaques, called the themes of work complexity, as illustrated below: 110

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Table 30: Themes of work complexity

Work themes

Essential tasks

Time span

Corporate prescience (VII)

Sustaining long-term viability, defining values, moulding contexts

20–50 years

Corporate citizenship (VI)

Reading international contexts to support/alert Level V strategic business units

Up to 20 years

Strategic intent (V)

Overview of organisational purpose in context and accountability for sustainability of a unified work system

Up to 10 years

Strategic development (IV)

Integrating; modelling new futures, new services and products; positioning the organisation within the market context

Up to 5 years

Practice (III)

Constructing, connecting and fine-tuning systems, making most of resources

2/3 years

Service (II)

Supporting/servicing workers in the quality theme and customers/clients

1 year

Quality (I)

Hands-on skills

3 months

This table suggests that work on a Level I is limited in terms of the level of complexity, as it is concerned with quality and hands-on skills, and the impact of the work is usually short lived. Work at a Level VII focuses on a time span of 20 to 50 years, leading to severe complexity that is, in essence, about shaping the industry, focusing on long-term viability.

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From the above it is clear that the modern organisation is a complex dynamic system. This in itself implies certain leadership challenges to the person(s) leading an organisation as a social system. Oshry (1999: 151–188) describes the system leader as someone with a deep knowledge of the dynamics of systems. Such a person is not blinded by system limitations and tends to lead from the inside, seeking to bring the system to an awareness of itself. He/she understands that there is no single best way to organise – the best way to organise depends on the nature of the environment within which the organisation functions. Modern organisational theory, unlike the more classical approach, is not about the ‘one grand’ theory; it recognises that various theories can add to an attempt to explain organisations. Based on the discussion of the literature above, recognising organisations as social systems entails the following notions: •

Organisations are a purposeful association of autonomous members;

•

Organisations as social systems are grounded in instability; there is a constant reduction of complexity to maintain the system;

•

There are increasingly complex critical tasks or requirements at each organisational level, created by the need to deal with a more encompassing and turbulent environment;

•

Organisations are complex adaptive systems, simultaneously open and closed;

•

The system’s survival is dependent on its participants contributing resources, time and energy to it;

•

The role of the leader is to coordinate this complex system by making sense of what is currently happening within the system, creating possible futures for the organisation and realising that a change in one area of the system will have an immediate effect on the rest of the system.

This section has mainly dealt with organisational theory from a systems perspective. The following section explores the modern 112

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organisation in terms of its characteristics and design, which are anchored in a systemic paradigm.

The modern organisation Cooper (1999) describes the 1980s as the decade of ‘enterprise culture’, with people working longer and harder to achieve individual success and material rewards. He further argues that globalisation, privatisation, process re-engineering, mergers and acquisitions, strategic alliances and joint ventures have all combined to transform workplaces into hot-house, free-market environments. The 1990s, characterised by the economic recession and technological advances, led to many organisations becoming smaller. Information overload occurred, and there was an accelerated pace of work and a greater speed of response (Cooper, 2005: 2). The modern organisation is no longer characterised by the high-volume production of goods and services at a central location. Research into the philosophy, meaning, architecture and design of the modern (and emerging future) organisation has captured the attention of researchers, and the literature in this area has been quite diverse (Bartlett and Ghoshal, 1989; Galbraith and Lawler, 1993; Ohmae, 1990; Reich, 1991). What is increasingly emerging is a decentralised and networked organisation, focusing on specific customer needs (Reich, 1991). Giving support to the shape of things to come, Gerstein and Shaw (1992) hypothesise that modern organisations are likely to exhibit new characteristics, such as networks, autonomy and fuzziness. The remainder of this section is devoted to theories on the design of the modern and the emerging future organisation.

Characteristics of modern organisations Kotter (1996) states that modern organisations have the following characteristics: •

Persistent sense of urgency;

•

Teamwork at the top; 113

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•

People who can create and communicate vision;

•

Broad-based empowerment;

•

An adaptive corporate culture; and

•

No unnecessary interdependence.

Arie de Geus (1997: 51–59) puts forward the argument that organisations, due to an exclusive focus on economics, are not ‘living’ companies. Although there are examples of organisations that have been in existence for hundreds of years (churches, universities, the Salvation Army), commercial organisations generally do not ‘live’ very long. In his research, De Geus found that successful companies have a number of personality or behavioural traits in common: •

Conservativeness in financing;

•

A sensitivity to the world around them;

•

A keen awareness of their own identity; and

•

A tolerance for new ideas.

A similar argument to that of De Geus is put forward by Kiefer and Senge (quoted by Adams, 1984: 70), who describe metanoic organisations as having five key characteristics: •

A deep sense of vision or purposefulness;

•

Alignment around that vision;

•

Empowering of people;

•

Structural integrity; and

•

Balance between reason and intuition.

Stewart (1992: 92–98) describes the characteristics of the modern organisation as follows: •

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It is a high involvement workplace, running operations with self-managing teams and strategies for empowering employees;

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•

There is a new emphasis on managing business, with a ‘productivity turbo-charger’ integrating business processes and material and handling, instead of having different functional departments;

•

The evolution of information technology allows for the rapid distribution of knowledge, accountability and results anywhere in the organisation;

•

Self-management is practised to the extent that workers have the incentive and power to respond to whoever buys their output; and

•

The capacity to improve and innovate is nurtured; learning becomes the axial principle, replacing control as the fundamental job of management.

It can be concluded that the modern organisation is characterised by •

a sense of purpose and meaning, a keen awareness of its own identity;

•

alignment of its vision with the integration of different functions, processes and departments;

•

high involvement in the workplace, with a focus on empowering people, where self-management forms the core of control and teamwork;

•

values innovation and improvement, where continuous learning forms part of the values and principles of the organisation;

•

a resilient and adaptable organisational culture;

•

a sense of urgency, coupled with a conservative approach to finance;

•

a keen awareness of and sensitivity to the external environment.

If the abovementioned are typical characteristics of the modern organisation, the following questions relate to what a modern organisation looks like and how it is designed. 115

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Design and models of modern organisations A more flexible, adaptable, integrated design is needed to encompass the characteristics of a modern organisation. The following provides an overview of some of the most prominent thinking on organisational design and models. Table 31: Organisational design

Design

Influential Description of the design thinkers

Adhocracy

Toffler (1970); Mintzberg (1979)

116

Adhocracy is a non-bureaucratic network organisation, which depends on many rapidly shifting project teams and much lateral communication. Mintzberg (1979) further developed the concept where his adhocracy represents smaller-scale, fluid structures. What typically happens is that groups of line managers, employees and operating experts form small project-focused teams with their own terms of reference. Mintzberg (1979) defines two types of adhocracy, namely operating adhocracy (that operates on behalf of clients) and administrative adhocracy (that tends to serve itself). However, managers within an adhocracy may spend too little time strategising. The key is to find a balance between the need for action (implementation) and taking a longer-term view in terms of being sensitive to changes occurring within the environment.

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Design

Influential Description of the design thinkers

Agility

Goldman, Nagel and Preiss (1995)

The concept of corporate agility is a response to the need for organisations to adapt better to changing market conditions. It recognises that the speed of responses to market opportunities and threats distinguishes many successful organisations from their lumbering adversaries. Agile competition is a system consisting of strategic dimensions, allowing organisations to migrate from one business to another. This implies a complexity beyond the speed of a response; the organisation is able to adapt and make lateral moves. The dimensions are defined as follows: •

•

•

Organising to master change and uncertainty: An agile organisation is organised in a way that allows it to thrive on change and uncertainty; Leveraging the impact of people and information: An entrepreneurial culture that nurtures and invests in people and information, and leverages the impact of both; Cooperating to enhance competitiveness: This dimension of cooperation is important both from an internal as well as an external perspective, e.g. cooperating with other companies;

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Design

Influential Description of the design thinkers

Agility (cont.) Goldman, Nagel and Preiss (1995)

•

Enriching the customer: Customers perceive the organisation as adding value and enriching the customer, not only the organisation itself.

Hamel and Prahalad were the American champions of the concept ‘core competencies’, suggesting in their book Competing for the future Hamel and that a core competency should Prahalad provide potential access to a wide (1994); variety of markets, make a significant Lawler and contribution to the prospective customer and be difficult for Ledford competitors to imitate. Stalk, Evans (1997) and Schulman’s (1992) approach suggests a similar concept, but they label it ‘strategic capabilities’. These capabilities are more operational than technical in nature and provide an organisation with a competitive advantage in the marketplace. A key determinant of the usefulness of competencies and capabilities lies in establishing whether they lead to different thinking about the design of organisations. The implication of this statement is that once an organisation has determined its strategy, competencies and capabilities, its structures, processes, reward systems and human resource management practices then need to be developed in order to produce these competencies and capabilities.

Core Evans and competencies Schulman (1992);

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Design

Influential Description of the design thinkers

Project/ Crainer Matrix model and Dearlove (2001); Morgan (1989)

The matrix model, developed by Philips, represents a compromise between centralisation and decentralisation. It is an organisational structure that was developed in an attempt to deal with the complexities of managing large organisations across different national markets. The unique characteristic of a matrix organisation rests in the fact that it gives more or less equal priority to each functional department. Therefore, people working in the various product or business teams traversing functional areas have to work with two perspectives in mind: functional and end product (Morgan, 1989: 64–67). The matrix model is based on project structures. The only difference is that when a project is completed, the system that supported it is terminated. The various system components in the matrix organisation are assumed to have indefinite life spans (Scott et al. 1981: 55).

Shamrock organisation

Handy (1989)

Shamrock is a form of organisation based around a core of essential executives and workers, supported by outside contractors and part-time help. It resembles a three-leaf clover and comprises •

core workers, consisting of talented, dedicated professionals;

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Design

Influential Description of the design thinkers

Shamrock organisation (Cont.)

Handy (1989)

•

•

contractors/the specialists who carry out work considered nonessential by the core workers; and the flexible labour force, made up of part-time and temporary workers who do/do not work, as determined by the peaks and troughs in customer demand.

The outcome of such an organisational structure, according to Crainer and Dearlove (2001: 104), is that organisations will tend to resemble the way consultancies, advertising agencies and professional partnerships are currently structured. The virtual organisation

120

Increasingly, terms such as ‘virtual Byrne, Brandt and teams’ and ‘virtual organisations’ Port (1993); dominate the literature when new economy organisations are discussed. Davidow Byrne, Brandt and Port (1993: 98) and define the virtual organisation as a Malone temporary network of companies (1992); that come together quickly to exploit fast-changing opportunities. Davidow and Malone (1992: 102–107) define this as a metacorporation, implying that the organisation’s sphere of influence extends upward through its suppliers and downward through its distribution channels, and even to the enduser.

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Design

Influential Description of the design thinkers

The virtual organisation (Cont.)

Grieves (2000)

Grieves (2000: 420–421) describes the characteristics of virtual organisations as follows: •

•

•

• •

Knowledge intensive: The pursuit and sharing of knowledge to continuously innovate; Meta-management: Strategic management of a network of independent companies which have collectively become interdependent; Fluidity and transformation: Dependence on organisational learning; Excellence: Focus on customers in order to be world class; Culture: Information and knowledge sharing, empowerment and trust between companies.

From the above it is clear that the virtual organisational design focuses on collaboration between different networks, in order to ‘negotiate’ mutual benefit for all. This collaboration is based on knowledge sharing, learning, trust and empowerment between the different networks.

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Design

Influential Description of the design thinkers

Learning organisation

Senge (1990, 1992)

A learning organisation comprises a group of people who are continually enhancing their capacity to create and innovate. Successful companies are learning organisations that gain the commitment of all their people, whilst simultaneously developing their people’s capacity to learn. Five disciplines need to be mastered in order to create a successful learning organisation: personal mastery, mental models, building shared visions, team learning and systems thinking.

It is evident from the table above that modern organisational design is characterised by the need for urgency, speed, growing complexity and learning, with the aim of continuous innovation. The next section explores the trends, patterns and scenarios of the future world of work from a systems perspective.

Future world of work – a systems perspective Questions about the future deal primarily with the thought mechanisms determining the way we think about the world. In studying this phenomenon, we cannot divorce what we see in the world from the concepts and ideas currently used to make sense of the world. In this context, Giddens (1991: 41) warns that while in the social world people are both the subjects and objects of knowledge, the fact that people are researched/known might also influence behaviour. He adds that social reality is constantly infused with meanings that “spiral in and out” – the more people learn, the more their knowledge is changed and influenced. In the remainder of this section the future world of work (trends, patterns and scenarios) as a complex adaptive social system is discussed. 122

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Creating a thinking framework A thinking framework (see Figure 14: A thinking framework for the future organisation and world of work) was developed to serve as a metaphor for the future organisation and the world of work. Graphically, the thinking framework can be summarised and illustrated as follows:

E X T E R N A L M A C R O S Y S T E M

Political

Environmental

Organisation of the future • Vision and purpose • Success measurements • Core competencies • Customer approach • Structure/design • Leadership • Culture • Governance

Social

Economical

Technological

Work situation of the future • Meaning of work • Place of work • New employee • Impact of technology, contract information and communication • Characteristics of • Customer the ‘worker’ relationships

Figure 14: A thinking framework for the future organisation and world of work

Assumptions of the thinking framework •

The framework is a ‘whole’ that cannot be divided into independent parts, because the behaviour of the parts and their effect on the whole depend on the behaviour of all the parts interacting with one another; and

•

The framework is grounded in instability.

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Components of the thinking framework •

•

External macro context: The organisation of the future and the work situation of the future will operate in the context of an external macro environment. The implication of this is twofold:

The organisation and the concept of work could survive only as long as they import more energy than they expend from the external macro environment, in the process of transformation; and



Changes in the external macro environment could have an impact on the bigger organisation system and/or the different sub-components.

The organisation of the future and the work situation are macro systems consisting of a number of interrelated subsystems. Determined by the theory that the future concept might not entail an organisation, they are discussed from two different perspectives, with the emphasis on the work system.

External macro context Starbuck (2005) puts forward a stimulating argument, noting that it seems likely that four mutually interdependent arenas of conflict will have special relevance for leaders of large organisations in decades to come: The conflict between •

the affluent and the moderately poor;

•

companies and nations;

•

top management and other stakeholders; and

•

the short run and the long run.

This implies a world of paradox that contributes to the levels of complexity expected from the future world of work, and adds to the challenges facing the future business leader.

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The organisation of the future Utilising the ‘organisation of the future’ thinking framework, the organisation is discussed in terms of •

vision and purpose;

•

core competencies;

•

structure and design;

•

culture;

•

success measurements;

•

customer approach;

•

leadership; and

•

governance.

Vision and purpose It is likely that the vision and purpose of the organisation of the future will be focused on meaning and on offering solutions. There can be little doubt that organisations in future will have to demonstrate their value beyond the traditional return on investment to society. Hey and Moore (1998: 232) introduced a term of engagement for organisations, which they call ‘the vital organisation’, implying a future organisation that will construct a community of meaning by listening, producing what is desired, and becoming a long-term partner to its customers.

Core competencies Hamel and Prahalad (1994: 243) argue that an organisation must be viewed not only as a portfolio of products or services, but also as a portfolio of competencies. Core competence should provide potential access to a wide variety of markets, make a significant contribution to the potential customer, and be difficult for competitors to imitate.

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According to Lawler (2002: 224–225), it is up to an organisation’s executives to define a strategy that will ensure the longevity of the competitive advantage gained through its competencies. With an increase in the development of disruptive technologies, organisations need to intensify the development of new core competencies (Christensen, 1997). Lawler (2002: 238) states that arguably the most important competence for any organisation is the ability to change rapidly – a competence that can be developed systematically. Guptara (2005: 117) is of the opinion that in the future, the new core competencies of organisations will focus on only three areas: Excellence in •

marketing (i.e. recruiting and retaining a loyal base of customers);

•

organising and operating an ‘intelligent’/robotic value chain; and

•

innovation (new products, services, ways of marketing and organising logistics, perhaps through technological creativity and innovation).

Linking to the theme of innovation, Prahalad and Ramaswamy (2004: 138–153) state that the future organisation is likely to utilise supply networks as an important source of competence. They define networks as the whole system – the organisation, suppliers, partners and the consumer. This once again links to the theme of seeing organisations as complex adaptive social systems.

Structure and design/Place of work Previously, a detailled description of modern and emerging organisational designs was provided. For many employers the virtual workplace, in which employees operate remotely from each other and from managers, has become a reality, and all indications are that it will become even more prevalent in the future. This represents a dramatic change in how people work, and alters the very concept of an organisation as a fixed location where people gather to work (Cascio, 2002: 203). 126

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Organisational culture Cartwright and Cooper (1992: 52) define organisational culture as the “internalising of a set of values, feelings, attitudes and expectations, which provide meaning, order and stability to organisational members’ lives and influence their behaviour”. Banathy (1996: 45) argues that organisations must break out of the old frame of thinking and reframe their thoughts. He argues that the culture of the future organisation will cater for purpose, meaning, integration and an evolutionary approach.

Success measurements As businesses move into the future, the old methods of reporting are proving insufficient. It is widely recognised that financial sustainability is no longer sufficient justification for a company’s performance. New forms of corporate disclosure, which integrate financial, environmental and social reporting, are starting to take shape (Kaplan and Norton, 1992, 1996). Handy (1994: 225–226) suggests that the following need to be included in the balance sheet of an organisation: •

Intellectual assets (brands, patents, skills base), including expenditure to enhance these assets (research and development, and training);

•

Customers (quality of goods and services, customer satisfaction); and

•

The environment (investment in environmental control and improvement, expenditure on community work and investment in the community).

The various measures of organisational success (or performance) are discussed below.

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Balanced scorecard Kaplan and Norton (1996: 8) describe the innovation of the balanced scorecard as follows:

The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in longterm capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology and innovation.

The balanced scorecard combines four perspectives, namely financial, customer, internal processes and innovation, and organisational learning perspectives, to help leaders look at the organisation from an interrelationships perspective – once again, linking to the theme of viewing organisations as an integrated system. This, according to Kaplan and Norton (1992), transcends traditional notions about functional barriers and ultimately leads to improved decision-making and problem-solving.

Economic value added (EVA) EVA is a measure of corporate performance that differs from most others by including a charge against profit for the cost of all the capital a company employs (Milbourn, 2001: 505). It is calculated as follows: EVA= NOPAT – C%(TC) •

NOPAT – net operating profit after taxes

•

C% – percentage cost of capital

•

TC – total capital

Ehrbar (1998: 5) defines EVA as a fundamental way of measuring and managing corporate performance. It is 128

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•

the corporate performance measure tied most directly to the creation of wealth;

•

the framework underlying a comprehensive new system of corporate financial management that guides decision-making;

•

a framework that can be used to communicate organisational goals and achievements; and

•

an internal system of corporate governance that creates an environment of cooperation and best performance.

Triple bottom line There is a growing recognition that companies are answerable and accountable to various communities, not least of which are their shareholders and employees. A consensus-based approach to stakeholder relations, rather than the traditionally adversarial one, takes account of current thinking on the symbiotic relationship between companies and their stakeholders (Naidoo, 2004). Triple bottom-line reporting is a path which points to practical benefits for companies themselves, as well as for their varied stakeholders. According to Elkington (1997), the underlying principles and issues may be described as follows: Sustainable development is a concept with which many people identify and sympathise, but if it is to become a global reality rather than remain a seductive mirage, governments, communities, companies and individuals must work together to improve their performance. The sustainability agenda, long understood as an attempt to harmonise the traditional financial bottom line with emerging thinking about the environmental bottom line, is turning out to be much more complicated than some early business enthusiasts imagined. Increasingly, we think in terms of a ‘triple bottom line’, focusing on economic prosperity, environmental quality, and – the element which business has tended to overlook – social justice.

It is clear from the above that there are increasing demands on corporations to disclose information which integrates financial, 129

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environmental and social reporting. It is very likely that this will form a fundamental aspect of the work of leaders. It will be required of leadership to guide organisations in the direction of corporate citizenship, which is defined by the Centre for Corporate Citizenship Boston College as “the business strategy that shapes the values underpinning a company’s mission and the choices made each day by its executives, managers and employees as they engage with society” (www.bcccc.net).

Leadership As the organisations within which leaders have to operate change, so the nature of leadership and the work of the leader must change accordingly. Most scholars gauge the effectiveness of leadership almost exclusively by economic performance (specifically, return on investment). The focus on economic results usually gives a one-sided picture of what leaders can accomplish. Viewing the world of work from a systems perspective would require leaders to •

design and develop the purpose (or function, role) that the organisation as a complex adaptive social system and/or subsystem fulfils, as measured by the implementation of its vision, mission and related strategy;

•

perceive and understand the system (organisation) that ‘produces’ a particular state within which the organisation and its subsystems function, as a whole, realising that a change in one area of the system will have an immediate effect on the rest of the system. Understanding what is currently happening, by thinking in terms of process, refers to how results (order, chaos, complexity and paradoxes) are ‘produced’ within the system and its sub-systems; and

•

think in terms of governance, which refers to how the integrity of a particular system is maintained in order to ensure its survival.

From a business perspective, upholding integrity or sustainability should clearly be the responsibility of leadership, thereby ensuring 130

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the sustainability of the organisation. Veldsman (2000) lists six additional major challenges associated with a postmodern world, from a qualitative perspective. These challenges do not exist or function in isolation, but influence and reinforce one another. The challenges also emerge within wider or narrower boundaries: the wider the boundary, the more complex the action required from leadership. These challenges include the following: •

Rapid, radical, unpredictable and continuous change;

•

Exploding variety in terms of beliefs, values, approaches, means and products/services;

•

Widespread ambiguity around frames of reference, belief and meaning systems;

•

Increasing complexity in the scope and range of systems, structures, processes, technologies and interactions;

•

Growing interdependency of systems, structures, processes, relationships, people and products/services; and

•

Widening seamlessness in terms of interaction and movement of people, information and products/services. (Veldsman, 2000: 76–78)

This raises a question as to which competencies are required of leaders who are able to meet the work requirements. Veldsman (2000: 78) suggests that leadership needs to match the necessary levels of difficulty. Therefore, before attempting to answer the question on competencies, the impact of complexity on leadership needs to be explored. Research has revealed an interest in the issue of different leadership requirements applying to different levels. The embodiment of such work is the systems model developed by Katz and Kahn (1966). Jaques (1976, 1989) built on many of the ideas set forth by the aforementioned authors, to develop the Stratified Systems Theory (SST). Essentially, SST suggests a general model of organisational 131

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functioning, such that there are increasingly complex critical tasks or requirements at each successive organisational level, and that effective leaders address these tasks. Increasing task complexity is a consequence of the uncertainties created by the necessity to deal with a more encompassing and turbulent environment as a leader moves up the hierarchy (see Jaques 1976, 1989). Jaques (1989) asserts that higher-level leaders must possess higher levels of cognitive complexity, in order to deal with the increasingly demanding critical tasks they encounter as they move up the organisational hierarchy. Ashby’s (1952) law of requisite variety argues that the complexity required of a leader must be consistent with that in the organisation, while Oshagbemi and Gill (2004: 4) argue that satisfaction with a leadership style at one level does not necessarily transfer to the level above or below. This is consistent with the SST perspective, which argues that as the task (work of the leader) becomes more complex, the leader’s cognitive complexity has to be developed correspondingly. Stamp (1991), who extended the SST and identified seven levels of work complexity, referred to this as the Matrix of Work. Olivier (2003: 32–40) combines the different levels into what he calls ‘work domains’. The first domain – the added value domain – and its three levels of work complexity (quality, service and practice) are largely concerned with operational excellence. The second domain – the innovative domain (strategic development and strategic intent) – represents a different type of work from both quantitative and qualitative perspectives. It is concerned with making a strategic contribution and creating sustainable competitive advantage. The third domain – the values domain (corporate citizenship and corporate prescience) – focuses on global issues that often guide economic, social, national and hence business policy. This is the world in which multinational companies operate, and because of the complexity of this level, there are only a limited number of truly global corporations (Olivier, 2003: 32–40). These levels can also be described according to themes of work complexity (Olivier, 2003: 32), as outlined in the table below. 132

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Table 32: Complexity and organisational work theme

Organisational work themes

Level of competency

Time span

Quality (stratum I)

Competent in ‘hands-on skills’ to complete a task or activity

1 day to 3 months

Service (stratum II)

Competent in supporting and coordinating workers to achieve set standards

3 months to 1 year

Organisational work themes

Level of competency

Time span

Practice (stratum III)

Competent in constructing, connecting and fine-tuning systems for optimal utilisation of resources

1 year to 2 years

Strategic development (stratum IV)

Competent in integrating new futures, new services and products, including positioning the organisation within the market context

2 years to 5 years

Strategic intent (stratum V)

Competent in a unified work system by understanding the organisation’s purpose

5 years to 10 years

It is clear that complexity increases per stratum and per associated time span. Based on the concept of different levels of complexity, Drotter and Charan (2001) developed a leadership pipeline that they claim represents six passages or major events in the life of a leader. Understanding what each passage entails and the challenges in making each transition, will enable organisations to respond to 133

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changes and threats in the business environment. The pipeline also links different skills to the different passages. Passage one is, for example, concerned with self-leadership, whereas passage six is more concerned with values than skills. Drotter and Charan (2001: 25) further argue that leaders who have skipped one or more passage can diminish the performance of direct reports and individuals all the way down the line. This clearly presupposes a logical flow between the different levels of work or passages.

Governance The concept of corporate governance has become increasingly important during the past decade. Legally and philosophically it is no longer acceptable for businesses to concentrate only on generating returns. Companies are now also expected to act as ‘good corporate citizens’. In addition to generating financial returns, the manner in which such returns are generated, and the direct and indirect effects of doing business inside and outside the company, are now ranked alongside financial performance. Arguably, because of their visibility and impact on others, society and the environment as a whole, companies are required to adhere to higher standards of ethical practice (control of accountability, responsibility and authority) and need to create a sense of trust in order to remain competitive in this age of change (Naidoo, 2002; Sifonis and Goldberg, 1996). There are a number of definitions of corporate governance. Naidoo (2002: 1) provides a succinct starting point for defining corporate governance as follows: “Corporate Governance is … the practice by which companies are managed and controlled.” A broader definition is found in the King II report (King, 2002: 5): “[Corporate governance is] … a participative… system of enterprise with integrity … in the interests of a wide range of stakeholders having regard to the fundamental principles of good financial, social, ethical and environmental practice.”

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Sir Adrian Cadbury (1999), the father of corporate governance in the United Kingdom, extends this concept in a report on corporate governance for the World Bank:

Corporate Governance is concerned with holding the balance between economic and social goals and between individual and communal goals. The governance framework is there to encourage the efficient use of resources and equally to require accountability for the stewardship of those resources. The aim is to align as nearly as possible the interests of individuals, corporations and society.

In the future world of work, it would most probably be expected of organisations to adhere to the following requirements of good governance, as set out by King in the King reports I, II and III: •

Aligning the company’s operations with the prevailing philosophical, socio-political, legal and commercial context within which it operates;

•

Developing ethical frameworks that guide how directors, managers and staff conduct the company’s affairs, and that continually build the ethical base of individuals responsible for executing corporate responsibilities;

•

Understanding and meeting or bettering the legal roles, obligations and responsibilities of directors and managers in ensuring well-run companies;

•

Ensuring compliance with the letter and spirit of organisational structures, the composition and functions that are required of companies in order to give them the best chance of complying with good governance practices; and

•

Working towards ‘good corporate citizenship’ by doing business in a responsible and sufficiently open manner that ensures a balance between maximum profits; positive social, economic and environmental benefits; and minimised negative impact for

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all direct and indirect stakeholders. This includes the need for recording, compiling and reporting on the ‘triple bottom line’ of environmental, social and economic performance. According to Simms (2003: 20) there is a need to redefine the somewhat blurred boundaries between the roles of government, the voluntary sector and business. But, nevertheless, businesses do need to find a dual commercial and social purpose, once again linking to the purpose and vision of organisations.

The work situation of the future Whereas the preceding section focused on the characteristics of the future organisation, this section focuses on the work situation of the future, as discussed according to the framework set out. Even though they are interlinked, these two concepts are discussed separately due to the theory that the future concept of work may not necessarily entail what we now see as an organisation.

The meaning of work Already in the late 1970s, Katzell (1979: 35–57) argued that a trend would emerge for people to emphasise intrinsic factors (meaningfulness and challenge) in their work, rather than extrinsic factors (comfort and security). He outlined six broad trends:

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The traditional economic significance of work would be supplemented by a rising concern with its psychological quality and social meaningfulness;

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More workers at all levels would want a stronger voice in decisions affecting their jobs, and to be less subject to hierarchical control;

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A shrinking proportion of the workforce will be content to have routine, unchallenging jobs;

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More people will think in terms of long-range careers and even multiple careers, not just in terms of immediate jobs;

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•

The importance of activities not related to work (family, community, retirement and leisure) will increasingly rival that of work; and

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The workforce will exhibit a wider diversity in attitudes towards work, portending numerous departures from the foregoing.

In the late 1980s, research on work–family conflict and stress challenged the workplace to change, in order to take into account employees’ non-work-related demands and to address quality of life issues (Frone, Yardley and Markel, 1997; Lewis and Cooper, 1987). Yet, in 1994 only one in four workers was extremely satisfied with their work, compared to 40 per cent in 1973 (Fairholm, 1996). Fairholm (1996) states that work has become the focus of people’s lives: work is the place where people find meaning. According to Renesch (2000), more than 40 million people in the United States are seeking a more ‘intrinsically valued’ lifestyle, and the numbers are growing. While work is critical to economic wellbeing, these numbers suggest that it is not meeting the needs of human beings. In 1992 the Business Council of Australia, the Justice Peace and Creation Commission and more than 30 other organisations and individuals participated in a year-long research project entitled: ‘Australians at Work in 2020 (AAW).’ The project began as an attempt to codify and compare the forecast or expected futures predicted by participating organisations. The following is a summary of the key findings of the project: •

Currently people are experiencing a deep-seated dissatisfaction with work. Work is unsatisfactory and often demeaning. Similarly, many people do meaningful and valuable work, which is simply not recognised or valued;

•

There is a difference between work (labour which gives meaning to one’s life) and employment (labour which earns income). Many who are employed in jobs that are not critical to their sense of identity, define themselves more by their work and less by their employment;

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The way people work is more diverse than it has ever been, and these differences are respected as acts of personal choice. Work refers to something every adult can and will aspire to, for the duration of their adult life;

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Work will mean something very different in 2020. In fact, the word ‘work’ has been so marginalised that it may cease to exist by then; and

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Children will most probably begin to ‘work’ at a very early age, and retirement, as it is currently known, will no longer exist.

A close observation of life in organisations reveals a sort of ‘revolt’ against what is seen as the technocratic, strategically bureaucratic organisation, and exclusive scientific humanism that is typically considered hegemonic. What is emerging are activities that are often described as ‘New Age’ explorations, which include an interest in Eastern and pagan cultures, religions and spirituality (Casey, 2002: 144–145). A hunger for a common understanding of global ethics is emerging. This is also applicable to organisations where a stronger concern for integrity is becoming evident, and where more realistic, more conservative goals are set. Van Breda (1993: 40) supports this statement by acknowledging that the debate between values and prices was an old one, but adds that there is a definite emergence of a new consciousness. This, at times, might seem frightening to business and it calls for the establishment of an ‘awareness’ among individuals that they are members of a community that stretches across the globe. Handy (1997: 179) suggests that democracy as a philosophical principle is the driving force “that organisations must now come to terms with as their individuals begin to expect from their work communities the same collection of freedoms, rights and responsibilities that they have in the wider society. People are property no more.”

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New employee contract – contingent employment Contingent employment or the contingent work contract has become a label for employment relations, which fits the lexicon of the future workology (Matusik and Hill, 1998; Treu, 1992). Most of the literature on the topic of contingent work focuses on organisational motivations and environmental influences (such as technology) which have contributed to the growth of contingent work arrangements. Delsen (1999: 99–114) refers to contingent contract arrangements as a form of ‘new job’ creation; Sparrow (1998: 79–95) focuses on contingent work as the ability of the organisation to ‘manage’ the size of its workforce, in order to quickly adjust to cyclical variations within the marketplace; and Nishikawa (quoted by Gallagher 2002: 121) suggests that organisations are most likely to utilise contingent work in instances where specific technical skills are required. Lee, Hourquet and Macdermid (2002: 154) conclude that what is likely to be found more frequently in the future workplace is an increase in customised work arrangements, and work arrangements that are constantly in flux and changing according to individual and business needs. McCarthy and Hall (2000) identify some problems and issues with the future employment contract. These include a growing gap between those with the resources (education, self-confidence and ability to learn) and those without, coupled with increasingly complicated work and life balance issues.

Characteristics of the ‘worker’ The new world of work is characterised by increasing diversity among employees. Burke and Cooper (2003) stress that the dimensions in terms of which employees may differ include gender, age, marital status, parental status, race, ethnicity, education, sexual orientation, job tenure experience and physical disability. This creates the sense that diversity has both potential benefits and disadvantages.

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Strauss and Howe (1991) introduce the concept of ‘generational theory’ by arguing that American history can be viewed through the framework of a repeating cycle of attitudes and approaches to life. The cycle which they propose consists of four parts, each roughly 20 years in duration. They trace the cycle from the first American settlers from Europe up until the present day, and then make predictions about the future, right up to the year 2069. Strauss and Howe (1991) use the concept of ‘cohorts’ to explain that people from the same generation share similarities in terms of their world views and attitudes, mainly due to shared life experiences at comparable ages. They identify four main generation cohorts, namely the Silent Generation, the Baby Boomers, Generation X and the Millennium Generation (also known as Generation Y). Zemke, Raines and Filipczak (2000) apply this theory to the world of work, and argue that this leads to diversity in the workplace. There is a growing realisation that the gulf of misunderstanding and resentment between older, not so old and younger employees in the workplace is growing and becoming problematic (Zemke et al., 2000: 1). The notion is that older, not so old and younger employees differ not only in terms of their world view, but also (radically) in their approach to aspects such as work ethics, reward and leadership. Zemke et al. (2000: 24–170) propose that mixed generations can work well together if communication about issues across generational groups is encouraged and supported, complimented by muchneeded listening, and if diverse employees are utilised to strategically strengthen work units/departments.

Impact of technology, information and communication We know that technology has grown very fast over the past 200 years. Guptara (2005: 107–115) introduces a simple Five-way Model to help explain the five different ways in which technology currently impacts the world of work, and will impact it in the future: Technology

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•

automates existing processes, abolishing whole classes of occupation;

•

builds bridges between parts of a corporation that had little to do with each other;

•

cancels traditional divisions and creates entirely new ways of organising companies;

•

increasingly destroys the walls between an organisation’s internal divisions; and

•

eliminates the boundaries between industries.

The theme of knowledge management becomes particularly relevant within the context of technology, information and communication in the organisation. What is happening is that information technology is opening the door for organisations to respond quicker to external challenges. This notion is supported by Senge (1990), who claims that future successful organisations will be those that discovered how to tap into their people’s commitment and capacity to learn at every level in the company, and know how to use this accumulated knowledge for value creation. Karp (2003) argues that intellectual assets have always existed in organisations – since the dawn of civilisation, in fact. What is new and has been driving the recent surge in intellectual capital, has mainly been a combination of the following trends: •

Intensified business competition, mainly due to the globalisation of trade and the deregulation of important sectors; and

•

The advancement of information technologies, which paved the way for the development of new business models, new forms of organisation, and other types of value chains and value creation.

The future organisation will be more virtual in nature. To be viable, virtual organisations/offices will, according to Cascio (2002: 205), require four kinds of information:

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Online material that can be downloaded and printed;

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Databases on products and customers that are accessible from remote locations;

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Well-indexed, automated central files that are accessible from remote locations; and

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A way of tracking the location of mobile workers.

Customer relationships The Internet will change the relationship between consumers and producers in a way more profound that you can yet imagine. The Internet is not just another marketing channel … The Internet is the foundation for a new industrial order. The Internet will empower consumers like nothing else ever has… – Hamel and Sampler, 1998: 80–81 A fundamental aspect in terms of the relationship between organisations and customers is a shift in the balance of power. Organisations no longer have carte blanche to decide on product quality, pricing strategies, distribution channels and client support. Consumers increasingly demand involvement in one form or another in deciding on these issues. These statements will be discussed in detail later on in the section on the changing consumer within the retail environment.

Conclusion The speed and complexity of change in the world will also impact on the world of work as we know it today. To understand the organisational perspective and its future challenges, this chapter firstly explored the evolution of organisational theory. It was concluded that the traditional organisational theory that put forward the hierarchical system and bureaucratic approaches functioned well into the 1970s and 1980s, but it no longer addresses the rapid changes and complexity of the future world of work.

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Today’s organisations are no longer characterised by the highvolume production of goods and services at a central location. What is emerging more and more is a decentralised and networked organisation focusing on specific customer needs. Modern organisations are likely to have ‘new’ characteristics such as networks, autonomy and fuzziness. In line with the thinking on the organisation of today, contemporary organisation theory ­(unlike the more classical approaches)­is not about the ‘one grand’ theory, but is in essence about recognising that something which has provided value is not turned into something worthless by new thinking. A conclusion was also reached that, from a systems perspective, the work of the future business leader is to •

design and develop the purpose (or function, role) that the organisation as a complex adaptive social system and/or subsystem fulfils, as measured by the implementation of its vision, mission and related strategy;

•

perceive and understand the system (organisation) as a whole, which is ‘producing’ a particular structure within which the organisation and its subsystems function, realising that a change in one area of the system will have an immediate effect on the rest of the system. The leader has to understand what is happening by thinking in terms of process, which requires making sense of how results (order, chaos, complexity and paradoxes) are ‘produced’ within the system and its subsystems; and

•

think in terms of governance, which refers to how the integrity of a particular system is maintained to ensure the survival of the system.

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CHAPTER 9 THE CHANGING WORLD OF LEADERSHIP It is difficult to envisage leadership and management surviving the emerging world of work in their current form. From the previous chapter it is clear that traditional approaches to leadership no longer address the rapid social, cultural and organisational changes that are occurring globally. Leadership in this new-economy organisation finds itself in the midst of an emerging mindset. The purpose of this chapter is to introduce and explore the concept of leadership. Already in the mid-1980s, Bennis and Nanus (1985: 4) stated that “[l]eadership is the most studied and least understood topic of any in the social sciences”. They further argued that despite decades of academic analysis, the empirical investigations of leaders have produced no clear and unequivocal understanding about what distinguishes leaders from non-leaders. But still, the fascination with what leadership and management encompass, continues. Despite the fact that it is hard to define and capture the concepts of leadership and management, the belief clearly prevails that leadership is now more important than ever. It is clearly a complex concept with a broad range of different interpretations. In the next section, different theories on leadership will be discussed.

An overview of leadership theories Over the years, leadership has been studied extensively in various contexts and from various theoretical foundations. In some cases, it is described as a process, but most theories and research on leadership look at the leader him/herself to gain an understanding of the phenomenon.

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Five broad approaches related to leadership theories have emerged in the 20th century, namely trait, behavioural, power-influence, situational and integrative. These approaches, however, did not develop and do not occur in a linear fashion. Van Maurik (2001: 3) states that

[a]lthough it is true that the progression of thinking tends to follow a sequential path, it is quite possible for elements of one generation to crop up much later in the writings of someone who would not normally think of himself or herself as being of that school. Consequently, it is fair to say that each generation has added something to the overall debate on leadership and that the debate continues.

The following sections provide a summary of trends and theories in leadership research during the past and present centuries.

Early approaches to defining leadership During the Agricultural Age, the quality of leadership and management varied vastly – be it within politics, the army or the church (Olivier, 2003: 2). Great-man theories dominated the discussion field of leadership prior to 1900, and gave rise to trait theories of leadership (Covey, 2004: 352). This early thinking on leadership is summarised by Dowd (1936, as quoted by Covey 2004: 353): “[T]here is no such thing as leadership by the masses.” The masses may be influenced, but they are always led by the superior few. The next growth spurt came with the arrival of the Industrial Age. Ideas surrounding the design and structure of organisations had their basic tenets and assumptions rooted in the industrial revolution of the 1700s, and the professions of engineering and economics. Sharitz and Ott (2001: 28) summarise the fundamentals as follows:

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Organisations exist to accomplish production-related and economic goals;

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There is one best way to organise for production and that way can be found through systematic, scientific inquiry;

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Production is maximised through specialisation and division of labour; and

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People and organisations act in accordance with rational economic principles.

The evolution of leadership during the Industrial Age demanded different skills, methods, approaches and human cognitive capability – business became more complex. New work levels emerged, dictating the need for systems, technologies, procedures and practices (Olivier, 2003: 3). It is clear that the thinking on leadership and management would become a logical, rational science, in line with thinking on evolution and scientific research. Between 1924 and 1934 the Hawthorne Studies were conducted, which led to new thinking about the relationships between work environment, human motivation and productivity. This shifted the focus of leadership thinking towards the relationship between the leader, the organisation and the follower. The rest of this section concentrates on the main leadership theories emerging from the Industrial Age.

Trait approach The trait approach suggests that people are born with special traits that make them great leaders. The leader is endowed with superior traits and characteristics that differentiate him from his followers (Northouse, 2004). The research on trait theories addresses the question as to what traits distinguish leaders from other people, and what the extent of those differences is. Cacioppe (1997: 335) observes that although various studies have tried to identify these traits, no definite pattern has emerged. However, when one analyses this research, the following traits are consistently evident: •

Intelligence/cognitive ability;

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Self-confidence; and

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Sociability (also defined as extroversion). 147

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Robbins (2003) claims there are at least four limitations to the trait theory: •

There are no universal traits that predict leadership in all situations. There are, however, traits which predict leadership in selective situations;

•

Traits predict behaviour more often in weak situations than in strong situations. The strong situations are those in which strong behavioural norms exist, including strong incentives for specific behaviours and clearly defined expectations of which behaviours are rewarded and which punished. These strong situations, in turn, create less opportunity for leaders to express their inherent dispositional tendencies. In many organisations a highly structured, formal culture exists which fits the description of a strong situation, therefore limiting the power of traits as predictors of leadership;

•

There is no clear evidence in differentiating between cause and effect. In other words, are leaders self-confident or does becoming a successful leader build the leader’s self-confidence?

•

Traits do not distinguish between effective and ineffective leaders; rather, they seem to be more accurate at predicting the appearance of leadership.

As a result of criticism, researchers shifted their focus from identifying leadership traits to leadership behaviour or style, and their impact on the performance and satisfaction of followers.

Skills approach

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The skills perspective emphasises the competencies of leaders. The focus has, however, shifted from personality traits (as in the trait approach) to an emphasis on skills and abilities that can be developed (Northouse, 2004: 35–36).

•

Katz (1955: 34) suggests that the development of three basic personal skills, namely technical, human and conceptual, leads to effective administration (i.e. leadership). Katz (1955) defines these skills as follows:

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•

Technical skill: Having knowledge of and being proficient in a special type of work or activity;

•

Human skills: The ability to work with people; and

•

Conceptual skills: The ability to work with ideas and concepts.

According to Katz (1955) all three skills are important, but depending on where a person finds him/herself in the management structure, some skills are more important than others. In the early 1990s a group of researchers set out to test a comprehensive leadership theory based on problem-solving skills. Based on the findings of this research, Mumford, Zaccaro, Harding, et al. (2000) formulated a skills-based model of leadership. Rather than emphasising what leaders do, the skills approach defines leadership as the capabilities that make effective leadership possible (Mumford, et al 2000: 12). The skills model suggests that the experiences acquired in the course of a leader’s career influence his/her knowledge and skills when it comes to solving complex problems, implying that leaders can enhance their abilities through experience and development. By utilising the skills model, leadership effectiveness can be assessed through problem solving and performance. Northouse (2004: 63), though, warns that the skills model is weak in predictive value – it does not explain how a person’s competencies lead to effective leadership performance.

Style/Behavioural approach The style approach derived mainly from three different streams of research: •

The Ohio State Studies in the late 1940s (based on the findings of Stogdill [1948]);

•

The University of Michigan Studies (Cartwright and Zander, 1960; Katz and Kahn, 1951; Likert, 1961, 1967); and

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The work of Blake and Mouton on the Managerial Grid (Blake and Mouton, 1964, 1978, 1985). 149

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Based on the research mentioned above, it can be argued that leadership is essentially composed of two general dimensions: job or task behaviours, and people or relationship behaviours. Leadership effectiveness is a result of a combination of these behaviours, to encourage followers in their efforts to achieve a certain goal or objective. Northouse (2004: 84) emphasises that the style approach is not a refined theory that provides a neatly organised set of prescriptions for effective leadership behaviour. Rather, the approach provides a valuable framework for assessing leadership in a broad way, such as assessing behaviour with task and relationship dimensions. Robbins (2003) propounds that in general the behavioural explanations of leader behaviour have had modest success in identifying consistent relationships between patterns of leader behaviour and group performance.

Situational approach Hersey and Blanchard (1969) developed a leadership approach based on Reddin’s (1967) 3-D management style theory, namely Situational Leadership Theory (SLT). In situational theory, leadership effectiveness is a function of a variety of factors which vary according to the nature of the leadership situation. Situational approach theories assume that different situations require different leadership traits and patterns of behaviour, to be effective. These aspects are commonly referred to as situational moderator variables. These theories added and concentrated more on a distinct dimension, namely differences among employees and situations. This is made evident in successful leadership which, according to Hersey and Blanchard (1977, 1988), is achieved through selecting and applying the correct leadership style. Leadership effectiveness is determined by followers choosing to either accept or reject the leader. Effectiveness then depends on the actions and input of the followers. This is an important dimension, as 150

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the leader’s level of effectiveness depends on the actions of his/her followers, as stated above. Hersey and Blanchard (1977, 1988) refer to this as ‘readiness’, and suggest that it relates to the extent to which people have the ability and the willingness to accomplish a specific task. SLT views the relationship as similar to that of a parent and child. Proponents of the situational approach identify four specific leadership behaviours – from laissezfaire, impoverished leaders to highly directive team leaders. As employee maturity levels increase, a leader should begin to reduce task behaviour and increase relationship behaviour until his/ her followers reach moderate maturity levels. When the employee is immature in relation to the task, the leader’s task behaviour should be dominant. Both task and relationship behaviour should be exercised for employees at a moderate maturity level. When a follower is very mature, the leader should delegate responsibility for deciding how work is done, and should allow considerable autonomy. In conclusion, this approach provides a model that suggests to leaders how they should behave, based on the demands of different situations.

Contingency approach Contingency theory argues that the effectiveness of a task- or relationsoriented leader is contingent upon the situation. Leadership training programmes modelled on this theory help a leader to identify his/ her orientation and to adjust better to a favourable or unfavourable situation (Covey, 2004). The most widely recognised leadership contingency theory is that of Fiedler (1964, 1967; see also Fiedler and Garcia, 1987). According to Fiedler and Chemers (1974), contingency theory suggests that a leader’s effectiveness depends on how well his/her style fits the situation. It is also the first leadership theory that emphasises the impact of situations on leaders, not only on followers. It is predictive of leadership effectiveness and allows for leaders not to be effective in all situations (Northouse, 2004: 121). 151

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Fiedler’s contingency model proposes that effective group performance depends on the leader’s style, the extent to which the leader has control of the situation and his/her interaction with employees. In addition, Fiedler (1964, 1967) states that an individual’s leadership style is fixed. This implies that if the situation requires a task-orientated leader and the person in the relationship is relationship-orientated, the situation has to be modified or the leader must be removed and replaced, in order for optimum effectiveness to be achieved. Fiedler (1964, 1967) identified three dimensions which define the situational factors that determine leadership effectiveness: •

Leader–member relations: The degree of confidence, trust and respect members have in and for their leaders;

•

Task structure: The degree to which job tasks are structured or unstructured; and

•

Position power: The degree of influence a leader has over power variables such as recruitment, selection, salary increments and promotions.

In contingency theory the leader, as the primary decision maker, may need to change and restructure tasks in order to control those tasks, as well as activities and actions.

Contemporary leadership approaches Already in the late 1960s, Bennis (1966) argued that bureaucratic institutions are inadequately equipped to cope with a future that will demand rapid organisational change, participatory management, and the growth of a more professionalised workforce. The Information Era came into being, and according to Olivier (2003: 5) this wave heralded a pervasive rush of computer utilities, space technology, bio-genetics and an increasingly ‘internetted’ world, resulting in the awareness of non-linear dynamics and increasing complexity. The Information Age led to a subtle shift away from the past, where a handful of leaders dictated the future of things, to a greater, more widespread 152

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consortium of cogent leadership at all levels of endeavour (Olivier, 2003: 7). The remainder of this section focuses on more contemporary approaches to leadership, influenced by the increase in complexity that leaders were required to deal with.

Transactional and exchange approaches The transactional and exchange approaches are primarily concerned with the nature of the leader–follower relationship. Shaw and Costanzo (1982) argue that these theories are built on the principles of behaviouristic psychology, adapted to social interactions and employ metaphors drawn from economics, such as reward and cost, profit and loss. This implies that the theories in this tradition share the notion that social interactions that are deemed by participants to be more rewarding than costly, are likely to continue. Chemers (1997: 77) draws the conclusion that the common thread running through most of the exchange theories is that leadership influence ultimately rests on followers’ perception of the legitimacy of authority. Transactional theories focus more on how leaders can motivate followers by creating fair exchanges, and by clarifying mutual responsibilities and benefits.

Transformational approach Bass (1985) argues that existing theories of leadership primarily focus on follower goal and role clarification, as well as the ways in which leaders reward or sanction follower behaviour. This transactional leadership is limited to enabling only basic exchanges with followers and can be described as a social exchange relationship. He argues that a paradigm shift is required to understand how leaders influence followers to transcend self-interest for the greater good of their group and organisations, in order to achieve optimal levels of effectiveness. Bass (1985, 1990, 1999) conceptualises transformational leadership as comprising the following five factors: 153

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Idealised influence (attributed) refers to the socialised charisma of the leader, whether he/she is perceived as being confident and powerful, and is seen to focus on higher-order ideals and ethics;

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Idealised influence (behaviour) refers to the charismatic actions of the leader that are centred on values, beliefs and a sense of mission;

•

Inspirational motivation refers to the ways in which leaders energise their followers by viewing the future with optimism, stressing ambitious goals, projecting an idealised vision and communicating that the vision is achievable;

•

Intellectual stimulation refers to leader actions that appeal to followers’ sense of logic and analysis, by challenging followers to think creatively and find solutions to difficult problems; and

•

Individualised consideration refers to leader behaviour that contributes to follower satisfaction by advising, supporting and paying attention to the individual needs of followers, thus allowing them to develop and achieve self-realisation.

Transformational leadership broadens leadership to include the growth of followers. It places strong emphasis on morals and values. Despite such positive features, Northouse (2004: 198) identifies the following weaknesses in the approach: •

The approach lacks conceptual clarity;

•

It is sometimes seen as elitist and undemocratic;

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It suffers from an ‘heroic leadership’ bias; and

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It has the potential to be used counterproductively and in negative ways by leaders.

Transcendental approach Cardona (2000: 201–207) first introduced the term ‘transcendental leadership’ to describe leadership that is also based on particular values and ethics, such as collaboration and service orientation. Based on 154

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this concept, Sanders, Hopkins and Geroy (2003) developed a model that proposes three structural levels of leadership accomplishment, namely transactional, transformational and transcendental. Essentially, the model proposes that a leader’s development along three dimensions of spirituality (consciousness, moral character and faith) is associated with development along these three levels of leadership accomplishment. The proposed theory of transcendental leadership is intended to provide a framework towards arriving at a more comprehensive view of leadership by connecting traditional theories to a meaningful domain, namely spirituality. This links to the view of Caccioppe (2000: 115) that transcendental leadership at some level is about leadership wisdom, the ability to know what is needed at a specific moment, and to appropriately fulfil a worthwhile purpose.

Servant leadership The term ‘servant leadership’ was first coined by Robert Greenleaf (1977), who discusses the need for a new kind of leadership model that identifies serving others as the priority. Greenleaf (2002: 23) argues that servant leadership

begins with the natural feeling that one wants to serve, to serve first. Then conscious choice brings one to aspire to lead. The difference manifests itself in the care taken by the servant first to make sure that other people’s highest priority needs are being served. The best test is: do those served grow as persons; do they, while being served, become healthier, wiser, freer, more autonomous, more likely themselves to become servants?

Spears (2002: 4-8), who built on Greenleaf’s original concept, identified ten characteristics of the servant-leader that he regards to be of critical importance: •

Listening: An important skill for the servant leader, it needs to be reinforced by a deep commitment to listening intently to others. Listening also encompasses getting in touch with your own inner voice and seeking to understand what your body, 155

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spirit and mind are communicating. Listening, coupled with regular periods of reflection, is essential for the growth of the servant leader;

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Empathy: The servant leader strives to understand and empathise with others. People need to be accepted and recognised for their special and unique spirits. Empathy presupposes the good intentions of co-workers and does not reject them as people, even while refusing to accept their behaviour or performance. The most successful servant leaders are those who have become skilled, empathetic listeners;

•

Healing: Learning to heal is a powerful force for transformation and integration. One of the great strengths of servant leadership is its potential for healing the self and others;

•

Awareness: General awareness – especially self-awareness – strengthens the servant leader. Awareness also helps you understand issues that involve ethics and values. It facilitates the ability to see most situations from a more integrated, holistic perspective;

•

Persuasion: Servant leaders rely on persuasion rather than on their positional authority in making decisions within an organisation. The servant leader seeks to convince others rather than to coerce compliance. This element offers one of the clearest distinctions between the traditional authoritarian model and that of servant leadership. The servant leader is effective at building consensus within groups;

•

Conceptualisation: Servant leaders seek to nurture their abilities to ‘dream great dreams’. The ability to look at a problem (or an organisation) from a conceptualising perspective means that you have to think beyond day-to-day realities;

•

Foresight: Foresight is a characteristic that enables the servant leader to understand the lessons of the past, the realities of the present and the likely consequence of a decision for the future. It is also deeply rooted within the intuitive mind;

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•

Stewardship: First and foremost, stewardship assumes a commitment to serving the needs of others. It also emphasises the use of openness and persuasion, rather than control;

•

Commitment to the growth of people: Servant leaders believe that people have an intrinsic value beyond their tangible contributions as workers. As such, the servant leader is deeply committed to the growth of each and every individual within his/her institution. The servant leader recognises the tremendous responsibility to do everything in his/her power to nurture the personal, professional and spiritual growth of employees; and

•

Building community: The servant leader senses that much has been lost in recent human history as a result of a shift in which large institutions, rather than local communities, have become the primary shapers of human lives. This awareness causes the servant leader to seek to identify some means for building community among those who work within a given institution.

This approach, in essence, suggests an alternative to current approaches to leadership, assuming a commitment to serving and growing others and emphasising the use of persuasion instead of control. This is important for this book, as it clearly defines the nature of future business leadership.

Psychodynamic approach The psychodynamic approach to leadership arose from the development of methods for dealing with emotionally disturbed individuals and out of psychological theories of personality development (Stech, 2004: 261). The essential assumption of the psychodynamic approach is that an individual can change his/her behaviour and feelings by obtaining insight into his/her upbringing, prior relationships, and psychological development (Stech, 2004: 261). Kets de Vries (2001) and Goleman (1995) both emphasise the importance for leadership to understand their own emotions, learning to manage their emotions and learning to deal with the emotions of others. Goleman (1995) refers to this as emotional intelligence, 157

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and argues that people with higher levels of emotional intelligence function better as leaders. Stech (2004) stresses that the psychodynamic approach consists of bits and pieces borrowed from a number of scholars and practitioners, leading to an overlap with the transformational or charismatic, situational and servant leadership approaches. Based on the work of Hummel (1975), Stech (2004) and Kets de Vries (2001), the following conclusions can be drawn regarding the psychodynamic approach: •

The uniqueness of the approach lies in its focus on the personality of the leader and not specifically in traits, behaviours or processes;

•

Leaders are more effective when they have insight in their own psychological make-up and that of their followers. It is, therefore, important to provide mechanisms that will lead to these insights, such as workshops and personality assessments;

•

No particular personality type is better than any other in a leadership position – the key is acceptance of one’s own personality features and those of others; and

•

Emphasis is placed on the relationship the leader has with the follower, and the focus is on encouraging growth and rejecting manipulative techniques.

Spiritual leadership Research by Jacobson (1994) and Fairholm (1996) suggests that mature leaders seek more than mere economic rewards for the job they do. They redefine work to include the satisfaction of their inner needs, and their quest for spiritual identity and satisfaction. The authors confirm a growing need for workplace cultures, leadership and work processes that celebrate the whole individual with his/her needs, desires, values and a ‘wanting’ spirit self. Fairholm (1996: 11–17) defines the transcendent values of spiritual leadership as a focus on integrity, independence and justice. Elements of spiritual leadership include the following: 158

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•

Building shared values: Leaders inspire a sense of shared community values that provide the basis for sanctioning systems;

•

Vision setting: Leaders exhibit the sustained ability to build consensus and lead within the framework of common vision;

•

Sharing meaning: Leaders create meanings for others. They engage the heart;

•

Enabling: Leaders train, educate and coach followers, provide motivation, involve them in approved networks and then free them from situational constraints that hamper growth/ transformation towards full effectiveness;

•

Influence and power: Leaders have no desire to manipulate others. They help followers feel powerful and able to accomplish work on their own;

•

Intuition: Spiritual leaders are pioneers who try to produce real change that matters to people’s enduring needs, regardless of the risk;

•

Service: Spiritual leaders are ‘servanted’; and

•

Transformation: Spiritual leaders transform themselves, others and their organisations. (Korac-Kakabadse, Kouzmin and Kakabadse, 2002: 165–182)

Conclusion The table below highlights the key differences between the thinking approaches of the different theories on leadership. Although this comparison is done in a matrix fashion, it is important to note that leadership thinking did not evolve on a contingent line, as indicated in the matrix. As time progressed, ‘older’ ideas were revisited or re-explored through research. For example, servant leadership was first introduced in 1977, but only became popular in the late 1990s. It would therefore be logical to say that each school of thought added something significant to our understanding of the phenomenon called ‘leadership’. 159

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Table 33: Key differences – theories on leadership

Approaches emphasising leadership from the point of view of the leader

One best style or trait

Trait

Skills

Style / Behaviour

Emphasises the personality characteristics of the leader.

Emphasises the capabilities of the leader.

Emphasises the behaviour of the leader.

Approaches emphasising the follower and the context Situational

Contingency

Focuses on leadership in different situations. Demands a leader matches style to competencies and commitment of followers.

Concerned with styles and situations, effectively matching the leader and situation.

Approaches emphasising the leadership process Transactional & exchange Conceptualise leadership as a process that is centred around the interactions between leaders and followers. New leadership approaches

No one best practice 160

Transformational & transcendental

Psychodynamic approach

Process that change. Concerned with vision, values, emotions and ethics. Concerned with the performance of followers and developing them.

Emphasise the importance of leaders obtaining insight into their personality characteristics and understanding the responses of subordinates based on their personality.

Spiritual leadership

Servant leadership

Defines the transcendent values of spiritual leadership as a focus on integrity, independence and justice.

Servant leaders primarily lead by serving others.

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It is clear that there is no consistent definition of a successful leader or one best understanding of what causes people to act as they do at work. The search for those requirements which manifest in a future business leader is reflected in new approaches to leadership, which focus on the importance of leaders having an attitude of service toward internal and external stakeholders. This includes aspects such as values, integrity and honesty towards all, while credibility forms the basis of leadership. Horner (1997) argues that certain differentiating factors, that contribute to developing great leaders, can be assessed, inculcated through training and developed. There are differences in leadership effectiveness among individuals, and researchers therefore strive to identify, quantify and predict such differences. Although it is hard to define and capture, the belief clearly prevails that interventions will help to develop and improve leadership in organisations today.

The future business leader Verwey and Verwey (2003) identify two broad trends that influence the strategic and organisational demands world-wide companies have to contend with: •

Continuing and accelerating changes in the international business environment are drawing an increasing number of companies beyond their national borders; and

•

The growing complexities of inter-organisational relationships between companies and their stakeholders are challenging companies to find new and different ways to manage across once impermeable corporate boundaries.

Stated differently, organisations are in a period of extraordinary change, where both the essence and swiftness of change are different from what was experienced before. Olivier (2003: 19), who describes it as the fourth wave, refers to it as the Age of the Global Brain. The fourth wave, as described by Olivier, is not about technology, lower costs, production, communication and individualism, but about a growing awareness of the increasingly complex context. It is about a new value system. 161

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In this section the concept of the future business leader is explored. For the purposes of this discussion, it will be assumed that leadership in the future will depend on the fundamentals illustrated in the figure below:

Nature of leadership The organisation

Work of leadership

Figure 15: Fundamentals of the future business leader

The organisation of the future The organisation of the future, as well as the work situation, was discussed in the preceding chapter. It was argued that the modern organisation and the emerging future organisation are characterised by the need for urgency, speed, growing complexity and learning, with the aim of continuous innovation.

The work of leadership From a systems perspective it has previously been concluded that the work of the future business leader is to

162

•

design and develop the purpose (or function/role) that the organisation as a complex adaptive social system and/or subsystem fulfils, as measured by the implementation of its vision, mission and related strategy;

•

perceive and understand the system (organisation) as a whole, which is ‘producing’ a particular state within which the organisation and its subsystems function; realising that a change in one area of the system will have an immediate effect on the rest of the system. Understanding what is currently happening;

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by thinking in terms of process which refers to making sense of how results (order, chaos, complexity and paradoxes) are ‘produced’ within the system and its subsystems; and •

Think in terms of governance, which means how the integrity of a particular system is maintained to ensure the survival of the system.

Given this perspective, the changing nature of leadership will now be explored.

The nature of leadership The new leadership paradigm differs markedly from what was traditionally viewed as leadership or management. The traditional approach stated that in order to be effective, management should be founded on a well-defined hierarchy of authority. Discipline was determined by management and impersonal interpersonal relationships were encouraged. This is in sharp contrast to the view of Veldsman (2002), who argues that leadership is, in essence, the act of creating shared possible futures and realising a shared, specific chosen future with, through and for people. The future forms the context from which leadership derives its justification, as well as meaning on why and how to act. In the world of work people are searching for work that has meaning. Prescott (1993: 63) supports this statement by stating that the search for meaning, the desire for dignity and personal identity and the recognition that goes with it, is an integral part of a person’s life and the work he/she does. Verwey and Verwey (2003: 88) state that the nature of leadership can be viewed from an inside-out approach. They state that •

leadership is, in the first instance, based on personal holistic ‘wellness’, which is a prerequisite within a team context (regardless of level of authority in the organisation);

•

the preceding aspects are prerequisites for organisations to be ‘healthy’; 163

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•

the health of individual organisations must also be viewed from a perspective of their contribution to society; and

•

the final measure for each of these aspects is the quality of citizenship, be it at personal, group or organisational level.

Koestenbaum (2002: 42–61) introduces the concept of ethics in his work on the nature of leadership. He defines ethics by taking into account, amongst others, aspects such as mentoring, service, meaning, morality, integrity and principles. Bracey, Rosenblum, Sanford and Trueblood (1990) define the nature of leadership as honouring five unspoken employee requests: •

Hear and understand me, even if you disagree with me;

•

Please do not make me worry;

•

Acknowledge the greatness in me;

•

Remember to look for my loving intention; and

•

Tell me the truth with compassion – this will bring both compassion and acceptability to the workplace.

Kouzes and Posner (2002: 17–32) define the nature of the 21st-century business leader as follows: •

Credibility is the foundation of leadership;

•

Leadership is everyone’s business;

•

Leaders focus on the future;

•

Leaders are team players; and

•

Caring is at the heart of leadership.

Coetzee (2004) believes that comprehending the psychology of the inevitable is part of the modern leader’s agenda. He describes the nature of the modern business leader from the follower’s perspective. 164

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What do followers expect from leaders? •

Imaginative vision: Future focus

•

Evoking spontaneous followership: Relationship building

•

Removal of irrelevancies: Eradicating nonsense

•

Implicit trust and respect: No doubt. No conjecture. No politicking

•

Model worthiness: Credibility. Stature: Standing and substance

•

Energy: Mental and physical

•

Sanctioning devolution of authorities: Accountability and autonomy

•

Authoritativeness: Genuinely skilled. Experienced and wise

•

Unconventional: Positive surplus value

•

Support and protection: Team champion

•

Inspirational communication

•

Exuding and raising confidence

•

Image: Manners, reputation. Positive impact

•

Consistency: Non-erratic. Predictable, fair

•

Sensitivity: Appropriate behaviour and responses. High emotional intelligence

•

Noted for balanced integrated personal lifestyle and values

•

Absence of airs of seniority and importance

•

Courage: Daring. Risk-inclined. Independent.

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Conclusion From the above it is evident that the nature of future business leadership is an integrated system, focusing first of all on the individual, before extending to the team, the organisation and society. This integrated system is first and foremost based on holistic wellness, ethics and values from a personal perspective, implying that the wellness of the team, organisation and society is dependent on the wellness of the individual. This also links to two arguments proposed previously: •

The demand on future business leadership is to contribute to society (not only at the organisational level) and is related to the ability of leadership to generate an appropriate level of complexity. It is possible to have different leadership requirements at different levels of complexity; and

•

Transcendental leadership, in essence, promotes the three dimensions of spirituality within the domain of leadership, namely consciousness, moral character and faith. Transcendental leadership is therefore not a new idea – it is, in fact, a very significant departure from traditional ways of thinking about the nature of leadership.

Certain principles regarding the nature of leadership are evident from the literature review above:

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Leadership is about creating shared possible futures and realising a shared, specific chosen future with, through and for people. The nature of leadership contains a paradox: on the one hand it is required to focus on the future (bringing change), while on the other hand it should maintain the status quo;

•

Leadership is ‘everyone’s business’, implying that it is not reserved for a select few;

•

Leadership is about modelling worthiness, credibility and substance. In a sense leaders are required to ‘prove their right to lead’, which makes leadership worthy of being followed;

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•

The nature of leadership is also to create sustainability, which implies a time component. It can, therefore, be argued that the nature of leadership may change with different time concepts – short, medium and long term;

•

Caring is at the heart of leadership. Followers want to be treated with dignity, respect and compassion. Followers expect honesty and acknowledgement not only for their contributions to the workplace, but also for their uniqueness.

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RESHAPING LEADERSHIP DNA FIELD GUIDE Gushurst, K. (2004) ‘The new leadership – sober, spirited, and spiritual’, available from: www.strategy-business.com/enewsarticle/enews010804 (Accessed April 2004). Hamel, G. and Prahalad, C.K. (1994) Competing for the Future. Boston, MA: Harvard Business School Press. Hamel, G. and Sampler, J. (1998) ‘The e-corporation’, Fortune, 7, 80–92. Handy, C. (1989) The Age of Unreason. London: Century Business Books. Hersey, P. and Blanchard, K.H. (1969) ‘Life-cycle theory of leadership’, Training and Development Journal, 23, 26–34. Hersey, P. and Blanchard, K.H. (1977) Management of Organizational Behavior: Utilizing Human Resources, 3rd ed. Englewood Cliffs, NJ: Prentice Hall. Hersey, P. and Blanchard, K.H. (1988) Management of Organizational Behavior: Utilizing Human Resources, 5th ed. Englewood Cliffs, NJ: Prentice Hall. Hey, K.R. and Moore, P.D. (1998) The Caterpillar does not Know: How Personal Change is Creating Organizational Change. New York: The Free Press. Higgs, M.J. (2003) ‘How can we make sense of leadership in the 21st century?’, Leadership and Organisation Development Journal, 24(5), 273–284. Holburn, P. (2003) ‘The work of leadership in unpredictable times’, Management Today. Available from: www.managmenttoday.co.za (Accessed 23 February 2004). Holmberg, I. and Ridderstråle, J. (2002) ‘Sensational leadership’, in S. Chowdur Management 21C. London: Prentice Hall. Horner, M. (1997) ‘Leadership theory: Past and present’, Team Performance Management, 3(4), 270–287. Jaques, E. and Clement, S.D. (1991) Excerpted from Executive Leadership: A Practical Guide to Managing Complexity. Arlington, VA: Cason Hall. Jaques, E.A. (1976) A General Theory of Bureaucracy. London: Heinemann. Jaques E. and Clement, S.D. (1994) Executive Leadership: A Practical Guide to Managing Complexity. Cambridge, MA: Carson-Hall & Co. Publishers. Kaplan, R.S. and Norton, D.P. (1992) ‘The Balanced Scorecard – measures that drive performance’, Harvard Business Review (January/February), 71-79. Kaplan, R.S. and Norton, D.P. (1996) ‘Using the Balanced Scorecard as a strategic management system’, Harvard Business Review (January/February), 75-85. Kets de Vries, M. (2001) The Leadership Mystique – A User’s Manual for the Human Enterprise. Great Britain: Pearson Education Ltd. Khurana, R. (April 2003) ‘Toward more rational CEO succession: Chief executive’, available from: chiefexecutive.net (Accessed 20 February 2004). King, M. (2002) King Report on Corporate Governance for South Africa. South Africa: Institute of Directors in Southern Africa. Kirkpatrick, S.A. and Locke, E.A. (1991) ‘Leadership: Do traits matter?’ The Executive, 5, 48–60.

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RESHAPING LEADERSHIP DNA FIELD GUIDE Robbins, S.P. (2003) Organisational Behaviour: Concepts, Controversies, and Applications, 10th ed. Upper Saddle River: Prentice Hall. Scott, W.G., Mitchell, T.R. and Birnbarum, P.H. (1992) Organization Theory: A Structural and Behavioral Analysis, 4th ed. Homewood, Illinois: Richard D. Irwin Inc. Scott, W.R. (1981) Organizations: Rational, Natural and Open Systems. New Jersey: Prentice-Hall Inc. Stamp, G. (1989) ‘Management styles’, Management Decision, 27(4), 22–29. Stamp, G. (1991) A Guide to Career Path Appreciation. Brunel: University of West London. Starbuck, W. (2005) ‘Four conflicts of the twenty-first century’, in C.L. Cooper (ed) Leadership and Management in the 21st Century: Business Challenges of the Future. New York: Oxford University Press. Stewart, T.A. (1992) ‘The search for the organization of tomorrow’, Fortune, 18, 92–98. Sullivan, T.J. (1999) ‘Leading people in a chaotic world’, Journal of Educational Administration, 37(5), 408–423. Ulrich, D., Zenger, J. and Smallwood, N. (1999) Results-Based Leadership. Boston: Harvard Business School Press. Van der Merwe, L. and Verwey, A.M. (2009) Reshaping Leadership DNA. Germany: VDM Verlag. Veldsman, T.H. (2002) Into the People Effectiveness Arena: Navigating Between Chaos and Order. Rosebank: Knowledge Resources. Verwey, A.M. (September 2003) ‘Why is leadership suddenly such a big issue?’, Management Today. Available from: www.managmenttoday.co.za (Accessed 23 February 2004). Verwey, A.M. and Verwey, S. (2003) ‘Leadership: Walking the talk’, in S. Verwey and F. du Plooy-Cilliers Strategic Organisational Communication: Paradigm and Paradoxes. Sandown: Heinemann Publishers. Verwey, S. and Du Plooy-Cilliers, F. (2003) Strategic Organisational Communication: Paradigms and Paradoxes. Sandown: Heinemann Publishers. Wilson, G.L., Goodall, H.L. and Waagen, C.L. (1986) Organizational Communication. London: Harper and Row.

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INDEX

INDEX A ability of leadership 166 accountability 9, 21, 80, 110–111, 115, 134–135, 165 accuracy 4, 21, 31 action learning 58, 72–75 action learning assignment 73 adequate 23–24, 99, 128 adhocracy 116 administrative principles 103–104 age 95, 128, 134, 138–139, 146–147, 152, 161 agile 117 alignment 4, 70, 100, 114–115 alignment of leadership 70 ambiguity 131 analysis 12, 29–30, 43, 55–56, 78–79, 106, 145, 154 appeal 81, 154 application 28, 33, 58, 61, 63, 75, 90 appropriate 1, 8–9, 25–26, 29–30, 36, 38, 42–43, 48, 81, 85, 87, 89, 165–166 appropriate assessment 9, 43 appropriate level of complexity 42, 166 appropriate styles of leadership 1 architecture 53, 57, 89, 91, 113 areas 30, 65, 68, 80, 83–84, 88–89, 119, 126 argument 91, 104, 114, 124 articulating 27, 37 assessment approaches 37 assessment centres 39, 41, 44 assessment instrument 45 assessment matrix 44–45 assessment of business results 85 assessment of capabilities 37 assessment of leadership behaviour 39 assessment processes 28, 56, 81 leadership 27–28, 56 assessment results 48, 83 assessment tool 47–48 assessors 42

attention 27, 31, 33, 62, 74, 113, 154 attributes 10, 43 authority 69, 80, 104, 134, 153, 156, 163 average 3, 92, 94 awareness 32, 71, 112, 114–115, 138, 152, 156–157, 161 B Baby Boomers 140 balance 9, 69, 100, 114, 116, 127, 135, 139, 142 balanced scorecard 128 basic 38, 104, 108, 110, 146, 148, 153 behavioural 25, 28–29, 32, 38, 105, 114, 146, 148–150 behavioural approach 149 behavioural approaches 105 behavioural descriptors 28–29, 32 competent 32 behaviours of leaders 13 beliefs 101, 131, 154 benchmarking 88, 93 benefit realisation 85, 87, 89, 91, 93, 95, 97 best practice 22, 44, 52, 92–93, 97, 101, 160 best predictor 35 bigger organisation 124 blended learning approach 52, 60 boundaries 4, 22, 108, 131, 136, 141, 161 breakfast sessions 72, 74 budget 51, 83–84, 96 building community 157 bureaucratic approaches 104, 142 business challenges 27–28, 56 business leader 124, 143, 161–162, 164 modern 162, 164 business leadership 62, 157, 166 business manager 58 business metrics 89 business performance 88 business perspective 86, 130

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business processes 22, 115 optimising 22 business results 10, 73, 85–86, 90–91 business simulations 74 business strategy 8–9, 11, 33, 52, 70–71, 74, 77, 99, 130 business value 83–84, 91, 96–97, 99 business value add 91, 96–97 C candidate 35, 37, 46 candidates 35, 42, 46, 95 ready 95 capabilities 9, 25–26, 37, 118, 128, 149, 160 capability assessments 37 capacity building 5, 51, 53, 55, 57, 59, 61, 63, 65, 67, 69, 71, 73, 75 strategic leadership 5 capital 33, 52–53, 57, 85, 128, 141 human 33, 52–53, 57, 85 caring 16, 164, 167 changing nature of leadership 163 changing world of leadership 145, 147, 149, 151, 153, 155, 157, 159, 161, 163, 165, 167 characteristics, personality 160 characteristics of modern organisations 113 characteristics of virtual organisations 121 class 33, 121 classical 103, 105–106, 112, 143 classical approach 103, 105–106, 112 classroom 55–56, 60, 63–64 clients 4, 11, 20, 35, 99–100, 102, 111, 116 climate 11, 13, 17, 64 coach 7, 60, 67, 72–73, 159 coaching planner 66–67 cogent 153 cognitive 37, 132, 147 collaboration 18–19, 75, 121, 154 commercial 114, 135–136 commitment 4–5, 7, 21, 64, 122, 141, 155, 157, 160 common attributes of leadership 10 communication 56, 61, 73, 75, 105,

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107, 116, 123, 140–141, 161, 165 community 12, 70, 74, 106, 125, 127, 137–138, 157, 159 community work 127 compassion 164, 167 competence 13, 25–28, 36, 39, 44, 46, 63, 93–94, 125–126 competencies of individual leaders 75 competencies of leaders 148 competition 2–3, 117, 141 competitive positioning 8 competitors 3, 118, 125 completeness of leadership development solutions 92 complexity, appropriate work-typespecific 25–26 complexity capability 38 complexity of change 142 compliance 48, 82–83, 92, 96–97, 135, 156 complicated work 139 components 60, 75, 88, 119, 124 comprehensive 78, 129, 149, 155 conceptualise leadership 160 conclusions 31, 100, 158 conduct assessment 46 conflict 69, 124, 137 consent 46–47, 81 constant reduction of complexity 107, 112 consumers 142 contemporary leadership approaches 152 contemporary organisation 143 context, external macro 124 contingency 106, 109, 151–152, 160 contingency approach to organisations 109 contingent employment 139 contingent work 139 contingent work contract 139 contractors 119–120 contributions 4, 69, 157, 167 control 107, 115, 127, 134, 136, 152, 157 conversations 70–71, 74–75 breakfast 71, 74 core competencies 118, 123, 125– 126

INDEX

new 123, 126 core workers 119–120 corporate 3, 62, 67, 111, 114, 117, 127–130, 132, 134–135, 161 corporate governance 62, 129, 134–135 corporate performance measure 129 correct 17, 150 creativity 18–19, 126 credibility 64, 161, 164–166 criterion-related validity 48 critical leadership role coverage 95–96 cross functional mobility 95 culture 11, 13–15, 17, 24, 52, 88–89, 91, 95, 108, 113–115, 117, 121, 123, 125, 127 culture implications 14–15 customer relationships 128, 142 customers 11–12, 30, 39, 41, 111, 118, 121, 125–128, 142 cycle 56, 92, 140 D decision-making 5, 78, 104, 107, 128–129 decisions, final 82 defining leadership 7, 9, 11, 13, 15, 17, 19, 21, 23–25, 27, 29, 31, 33, 146 defining leadership strategy 7, 9, 11, 13, 15, 17, 19, 21, 23–25, 27, 29, 31, 33 defining processes 81 degree 29, 40, 48, 91–92, 94, 152 deliberate process 70 deliverables 88 delivery 55–56, 63–64, 68 description 13, 25, 87, 107, 116–122, 126, 148 descriptors leaders use 2 design of leadership development content 59 design of organisations 118 desired 10, 12–13, 17, 23, 25, 52, 75, 125 desired internal 17 developing great leaders 161

development content process 58 Development Dimensions International (DDI) 2 development management 57 development processes 32, 52, 56–57, 84 associated leadership 52 development programme module 61–62 development programmes 52, 60, 63, 80, 82–84 effective leadership 52, 60 most formal leadership 63 development terminology 26 differences 138, 147, 150, 159–161 dimension 61–62, 80–82, 86, 92–96, 110, 117, 150 dimensions 2, 15–16, 30, 45, 86, 100, 117, 139, 150, 152, 155, 166 directive team 151 directors 36, 135 diversity 61, 137, 139–140 divisions 68–70, 72, 141 domain of leadership 166 domains 27, 88, 90, 132 draft leadership competence 28 driving leadership excellence 74 E echelons of leadership 19 economic value added (EVA) 128 education 39, 139 effective 1, 20, 29, 36, 38, 40, 49, 52–53, 58, 60–61, 65–66, 74, 77– 78, 91, 148–152 effective developmental processes 65 effective leadership performance 149 e-Learning courses 93 element of leadership development 89 elements of spiritual leadership 158 emotions 157, 160 empathy 64, 156 emphasising 107, 149, 157, 160 empirical investigations 145 empirical investigations of leaders 145

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RESHAPING LEADERSHIP DNA FIELD GUIDE

employee engagement 3, 95 employee maturity levels 151 employment 137, 139 empowerment 114, 121 energy 4, 7, 22, 44, 61, 108, 112, 124, 165 environment, turbulent 110, 112, 132 envisage 145 essence, brand 8, 12, 24, 84 ethics 138, 140, 154, 156, 160, 164, 166 evaluation 38, 41–42, 56–57, 93 evolution 103, 115, 142, 147 evolution of leadership 147 evolution of organisational theory 103, 142 excellence 4–5, 51, 74, 97, 101, 121, 126, 132 exchange 153, 160 exco 74–75 execute 9, 33, 68–69 execution 33, 68, 82, 91, 96–97 execution of leadership strategy 82 executive 37, 43–44, 58, 77, 82, 84, 99 executive management levels 43–44 expenditure 127 experience 2, 12–13, 20, 23, 26, 30– 31, 44, 47, 66–67, 70, 72, 81–82, 102, 139, 149 expertise 18–19, 68, 75, 102 extent 44, 47–48, 65, 73, 103, 115, 147, 151–152 external 8, 10–12, 15, 29, 39, 52, 60–61, 65, 81, 89–90, 101, 115, 117, 124, 141 external leadership brand 11–12, 15 external macro context 124 external stakeholder 52 F facilitated workshop 71 facilitator of processes 101 facilities management 56 feedback, leadership performance 39 feedback process 39–41 final assessment battery 81–82

176

financial institutions 11–12 financial measures 85, 128 financial performance 2–3, 88, 134 financials 18–19, 55–56 fine-tuning 20, 111, 133 formal 7, 9, 29, 59–61, 63, 69–70, 72, 74, 93, 105, 148 formal leadership programmes 74 formal workshops 60 rated 60 formational leader 21 foundation of leadership 164 framework set 136 functional mobility 95 functional mobility of leaders 95 functions 41, 73, 75, 95, 112, 115, 135 fundamentals 146, 162 futures 20, 22, 111–112, 133, 137, 163, 166 fuzziness 113, 143 G generation 88, 140, 146 Generation X 140 Generation Y 140 generic models of leadership 7 good 1–3, 23, 30, 32, 52, 80, 97, 101, 134–135, 153, 156 good leadership talent practices 2 good practice 30, 32 governance framework 135 governance principles 78 great 1, 63, 67–68, 146–147, 156, 161 group 37, 41, 58, 61, 70, 74, 122, 149–150, 152–153, 164 growing complexities of interorganisational relationships 161 growth of contingent work arrangements 139 guidance 29–32, 68, 72, 75, 102 guides 72, 129 H Hawthorne Studies 105, 147 healing 156 heart of leadership 164, 167 hierarchical 13, 104, 136, 142

INDEX

hierarchies 104, 110 high involvement workplace 114 higher-level 132 highest quality 2–3 high-level 86 HIPO headcount 96 hiring processes 36 HR professionals 36, 52, 60 human 5, 33, 52–53, 57, 85, 104–105, 109–110, 118, 137, 147–149, 157 Human capital function 85 human relations 105 I idealised influence 154 identifying 31, 64, 148, 150 identity 107, 114–115, 137, 158, 163 implementation process 6 implications 4, 14–15, 17, 23, 27, 30, 39, 109 implications of levels of complexity 109 importance 18–19, 25, 137, 155, 157, 160–161, 165 important roles of leadership 21 impoverished 151 inclusive 74 indicators 85, 87–89, 91 individual leadership competencies 65 Industrial age 146–147 ineffective 60, 148 information 29–30, 32, 42–43, 90, 108, 113, 115, 117, 121, 123, 128– 129, 131, 140–141, 152 information processing 29 information technologies 141 innovation 18–19, 68, 97, 115, 122, 126, 128, 162 input 39, 71, 80, 108, 150 institution 1, 110, 157 institution of leadership 1 instruments 9, 37, 39, 43–44, 104 psychometric 37, 39 integrated 10, 53, 74–75, 78, 84, 116, 128, 156, 165–166 integrated leadership excellence development model 74 integration 42, 54–57, 115, 127, 156

interdependency 106, 131 internal 11–13, 15, 17, 48, 60–61, 65, 81, 89, 95, 101, 117, 128–129, 141, 161 internal leadership brand 11, 17 internal movement of leaders 95 internet 60, 142 inter-organisational relationships 161 interpersonal qualities 25–26 interventions 7, 57, 74–75, 81, 161 intuitive 19, 156 investment 8, 59, 75, 77, 86, 89, 125, 127–128, 130 investors 10–11 issues practical 24, 43, 47, 129 process 40, 43, 46–47, 66, 79 technical 43 J journaling 63–64 judgements 25–26, 42 K keen 114–115 key bottom-line metrics 2–3 key differences 159–160 key leadership positions 95 key performance indicators (KPIs) 87 key principles regarding leadership development 52 KPIs 87, 89–90 L labour 11, 120, 137, 147 large 13, 35, 44, 70, 103–104, 119, 124, 157 large hierarchical 13 leader actions 154 leader behaviour 150, 154 leader matches 160 leaders of large organisations 124 Leadership Academy 53 leadership approach 97, 150

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leadership assessment 28, 37, 56, 79–80, 83–84 leadership assessment approach 37 leadership behaviours 15, 25, 61, 151 leadership bench strength 88–89 leadership brand 7, 10–13, 15, 17, 23–24, 27, 51–52, 75, 77–79, 84, 88, 90, 100 branding 10 capacity 24, 51–52, 75, 90 checkpoint 23–24 essence 12, 24, 84 questions 9, 11–12, 16, 23 leadership capacity building 5, 51, 53, 55, 57, 59, 61, 63, 65, 67, 69, 71, 73, 75 leadership capacity identification 35, 37, 39, 41, 43, 45, 47, 49 leadership capacity question 59 leadership challenges 112 leadership coaching 65, 72 leadership community 12, 70, 74 leadership competence profile 27, 94 leadership competence profile shift 94 leadership competence strengths 39 leadership competencies 5, 11, 26–27, 58, 65 leadership competencies talent management system 58 leadership complexity, capabilities 25 leadership contingency theory 151 leadership conversation rooms 70 leadership conversations 70, 74 leadership crisis 1, 5 leadership development activities 75 leadership development and training function 89 leadership development architecture 53 leadership development coaching approach 65 leadership development content 59 leadership development cost 93

178

leadership development governance 87 leadership development interventions 75 leadership development learning content 88 leadership development links 59 leadership development metrics 89 leadership development operating model 53–54 leadership development operating model design 54 leadership development perspective 85 leadership development philosophy 53 leadership development process 51, 56, 58–59, 66, 88 leadership development process efficiency 88 leadership development programmes 52, 60, 63, 84 leadership development solutions 53, 91–94, 96 leadership development space 74 leadership development strategy 6–7, 37, 51, 70, 85–86, 88–91 leadership development strategy document 7, 37 leadership development strategy perspective 85 leadership development subject matter 61 leadership development vision 85 leadership development work 99 Leadership Directory 70 leadership DNA 2, 4, 6–8, 10, 12, 14, 16, 18, 20, 22, 24, 26, 70, 74–75, 102–104 leadership effectiveness 88, 95, 149–152, 161 leadership effectiveness questionnaire 95 leadership excellence 5, 51, 74 leadership expectations 32 leadership failure 68 leadership forecast 2–3, 36, 51 leadership framework 9, 27–28, 33, 37, 47, 56, 61, 79 leadership gaps 59

INDEX

leadership governance 77, 79, 81, 83 leadership implications 17 leadership influence 153 leadership intranet website 70 leadership landscape 52, 61, 71 leadership lessons 100 leadership levels 11, 19, 21, 23, 65 leadership model 155 leadership personality profiles 37 leadership philosophy 5, 37, 52 leadership pipeline 32, 58–59, 68, 133 leadership pipeline development process 58, 68 leadership positions 95–96 leadership practice 100 leadership process 160 leadership profile 8, 94 leadership quality 3, 51 leadership questions 8 leadership reputation 88 leadership requirements 131, 166 leadership research 146, 158 leadership roles 1, 59, 68 leadership segments 52 leadership selection 5, 36 leadership shocks 68 leadership situation 150 leadership skills 8, 13, 60, 69 leadership strategy 2, 5–9, 11, 13, 15, 17, 19, 21, 23–25, 27–29, 33, 77–79, 82, 84, 99–100 leadership strategy document 27 leadership strategy elements 79 leadership strategy governance 77, 82, 84 leadership strategy governance matters 82 leadership strategy governance model 77 leadership strategy metrics 86 leadership strategy perspective 82 leadership strategy work 99 leadership style 11, 13, 15–16, 95, 132, 150, 152 leadership summit design 71 leadership summits 70, 74 leadership talent 2, 5, 9, 35–36, 48, 51, 59

leadership talent identification 35–36 leadership talent identification processes 35 leadership talent investment 59 leadership talent pipeline 51 leadership theories 145–147 leadership thinking 100, 147, 159 leadership training programmes 151 leadership traits 148, 150 leadership transition programmes 67 leadership values 11, 17, 19 leadership vision 27 leadership wisdom 155 learning and development 57–58, 65 learning organisation 106, 122 learning portal 70, 75 learning value chain 54–55 lessons learnt 99, 101 level of authority 163 level of competence 63 level of competency 20, 133 level of complexity 20, 25, 28, 36, 42, 44, 49, 64, 68, 73–75, 111, 166 level of effectiveness 151 level of increased complexity 36 level of leadership development 96 level of task complexity 110 level of task complexity domain 110 levels 4–5, 11, 13, 19–24, 26–28, 32, 36, 43–44, 71, 80, 100, 107–110, 131–134, 151, 153 levels of cognitive complexity 132 levels of complexity 27–28, 32, 36, 57, 109, 124, 133, 166 levels of emotional intelligence function 158 levels of employee engagement 95 levels of endeavour 153 levels of systems 107–108 levels of work 4–5, 20, 36, 132, 134 levels of work complexity 132 levels of work theory 4, 36 limited section 106 limited section of organisations 106 linking 99, 126, 128, 136

179

RESHAPING LEADERSHIP DNA FIELD GUIDE

links 59, 87, 90, 126, 134, 155, 166 listening 125, 140, 155–156 location 113, 126, 142–143 long-term viability 111 lower 84, 161 M management level 73, 83 management processes 27, 82, 84 broader talent 82 managerial accountability hierarchies 110 managers 2–4, 21, 36, 41, 58, 61, 67, 69, 72, 74, 116, 126, 130, 135 marketing 10, 55–56, 126, 142 markets 8, 33, 104, 118–119, 125 masses 146 match assessment approaches 37 matrix of metrics 87–88 matrix of work 132 mature 151, 158 measurement approach 85, 87 measurements 85, 91, 94, 96, 123, 125, 127 mental 122, 165 meta-management 121 metanoic 114 methodologies 37 methods leaders 60 metrics domains 90 middle management development 58 Millennium Generation 140 mind 44, 51, 108, 119, 156 mobile 142 mode of 106 model 20, 53–54, 66, 74, 77, 86–87, 102, 104–105, 107, 109, 119, 131, 149, 151–152, 155–156 bureaucratic 104 moderate maturity levels 151 modern approaches 106 modern organisation 104, 112–116, 162 modern organisational theory 112 modes 71 motive 38

180

N natural systems 107 nature, changing 106, 163, 165, 167 nature of leadership 130, 162–164, 166–167 neo-classical approach 105–106 networked 113, 143 networks 29, 113, 121, 126, 143, 159 new 1–3, 8, 29, 33, 40, 67–68, 72, 110–111, 113–115, 126–127, 133, 138–139, 141–143, 147, 160–161 new core competencies of organisations 126 new economy 120 new leadership approaches 160 new value 161 new work levels 147 new-to-role managers 67 non-bureaucratic network 116 non-leaders 145 non-negotiables 19 nurtures 117 O open 107–108, 110, 112, 135 optimal 20, 107, 133, 153 organisation architecture 57 organisation culture 11 organisation functions 112 organisation of the future 123–125, 162 organisational 3–5, 13–14, 20, 36, 73–75, 88, 103–104, 106, 109–112, 115–116, 119–122, 126–129, 131– 133, 142, 161 organisational analysis 106 organisational context 74 organisational contingency theory 109 organisational culture 13, 88, 115, 127 organisational culture and climate 13 organisational demands 161 organisational design 109, 116, 121–122 virtual 121

INDEX

organisational format 14 organisational frames 31 organisational goals 129 organisational hierarchy 132 organisational leadership capacity requirements 36 organisational leadership DNA 75 organisational learning 121, 128 organisational level 20, 75, 109, 112, 132, 164, 166 organisational members 127 organisational motivations 139 organisational perspective 103, 106, 142 organisational philosophies 100 organisational principles 3 organisational procedures 104 organisational processes 67 Organisational Psychology Annual Conference 40 organisational purpose 64, 111 organisational resilience 62 organisational strategy 7, 73 defining 7 organisational structures 135 organisational success 36, 127 organisational system 22 organisational theory 103–104, 106, 112, 142 traditional 142 organisational theory development 103 organisational work themes 20, 133 organisations struggle 35 organisations use courses 60 outcomes 25, 54, 63–64, 80, 86 outperform 2–3 owner-managed businesses 3 ownership 9, 54, 80, 84, 86 ownership of leadership talent 9 P parallel 51, 110 participants 39, 42, 46, 68, 70, 81, 86, 93, 108, 112, 153 particular level of complexity 36 partners 12, 72, 99–100, 126 parts 6, 30–31, 85, 107, 123, 140–141 passages 133–134

patterns 107, 122, 150 peers 39, 41, 69 perceptions 25–26, 40, 94, 97 perceptions of leadership development 94 performance management 51 person 14–15, 26, 38, 48, 92, 112, 149, 152, 163 personality 37, 44, 114, 148, 157– 158, 160 perspective of complexity 73 perspectives 4, 30, 51, 69, 86, 119, 124, 128, 132 persuasion 156–157 philosophy 5, 9, 37, 52–53, 57, 80, 91, 100, 113 pillars 53 pipeline management 51 portfolio 55–56, 125 power 13–15, 18–19, 115, 142, 146, 148, 152, 157, 159 practical issues 43, 47 practices 2, 13, 51, 56–57, 68–69, 100, 103, 105, 118, 135, 147 predictors of leadership 148 predominant 15, 80 preparing 63 pressures 69 process design 40 process issues 43, 46 process mapping 58 process of transformation 124 processes 13, 22, 27–28, 30, 32–33, 35–36, 52–53, 56–57, 70–71, 80– 82, 84, 115, 128, 131, 158 product brand 10 product efficacy 10 products 3, 8, 10, 20, 111, 125–126, 131, 133, 142 proficiency 28–29, 32 project management 61–62 projects 73 promotion of leaders 95 promotion of leadership talent 48 protocols 81–82 providers 12, 83, 89 psychodynamic 157–158, 160 psychodynamic approach 157–158, 160

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psychometric 37, 39, 47–48 purpose statement 32, 90 Q

role of leaders 29 role-player analysis 78–79 rotation 72 S

quality 2–4, 20–21, 31, 36, 51–52, 62, 97, 101, 106, 111, 127, 129, 132–133, 136–137, 142 questions 1–2, 7–9, 11–12, 16, 23, 30, 59, 82, 115, 122 R rated 3, 36, 52, 60, 96 realities 105, 156 reasoning skills 38 general 38 symbolic 38 redefine work 158 registration 55–56 relationship leader-follower 153 symbiotic 129 relationship behaviours 150 relations-oriented 151 reliability 40, 43–44, 47 reliability coefficient 47 required 4–5, 8, 13, 20, 22–23, 25–26, 28, 32, 42–43, 74, 82–83, 130–132, 134–135, 153, 166 required leadership 8 required level of complexity 20, 74 requisite organisation 109 reshape 7, 75 reshaping leadership DNA 2, 4, 6, 8, 10, 12, 14, 16, 18, 20, 22, 24, 26, 28, 102–104 resources 5, 20, 59, 61, 66–68, 99, 108, 111–112, 133, 135, 139 response scales 40 responsibilities 21, 54, 77, 80, 135, 138, 153 responsibility of leadership 130 retirement 137–138 return on investment 86, 89, 125, 130 revenue 96 review 32, 52, 58, 81, 89, 166 right quality 36 roadmap 9, 53

182

sanction follower behaviour 153 scenarios 122 scheduling processes 56 scientific 103, 105, 138, 146–147 scope 13, 68, 72, 80–81, 131 seamlessness 54, 131 security 104, 136 segment 87, 89, 92–93, 95 selection 2, 5, 9, 35–36, 43, 46, 48–49, 51, 57, 80–81, 152 selection criteria 80–81 selection purposes 46, 57 self-image 38 self-leadership 134 self-management 115 senior 5, 10, 37, 43–44, 58, 68–69, 82 senior to middle management development 58 sensitivity 114–115, 165 servant leader 155–157 servant leader strives 156 servant leaders 156–157, 160 servant leadership approaches 158 servants 155 service 4, 20–21, 30–31, 70, 72, 97, 101, 106, 111, 132–133, 154, 159, 161, 164 service departments 70, 72 services 3, 8, 20, 55, 111, 113, 125– 127, 131, 133, 143 servicing 111 Shamrock organisation 119–120 shared understanding 52–53 shareholders 10–12, 129 Silent generation 140 simulated 74 simulation 58, 60, 74 situational 146, 150–152, 158–160 situational leadership theory (SLT) 150 skills approach 148–149 skills model 149 skills-based 149

INDEX

skills-based model of leadership 149 social interactions 153 social role levels 38 social role levels of competencies 38 social systems 107–108, 112, 126 complex adaptive 112, 126 society 40, 108, 125, 130, 134–135, 138, 164, 166 sound leadership brand governance 78 sources 29–30, 39 space 74–75, 152 spiritual leaders 159 spiritual leadership 158, 160 transcendent values of 158, 160 spiritual leadership servant leadership 160 spirituality 138, 155, 166 stakeholders 8, 10–13, 23, 39, 52, 77–78, 87, 108, 124, 129, 134, 136, 161 statistical integration process 42 stewardship 78, 135, 157 strategic 1, 3–5, 7, 20–22, 29, 32–33, 43, 55–56, 70, 72–73, 96–97, 101– 102, 111, 117–118, 132–133 strategic development 4, 20, 22, 29, 32, 111, 132–133 strategic development level 32 strategic intent 4, 20, 22, 70, 102, 111, 132–133 strategic planning process 7 stratified systems theory (SST) 109, 131 stratum 133 strong 1, 66, 102, 148, 154 structural 114, 155 structural levels of leadership 155 structure of organisations 146 structured process 63 structures 77, 108, 116, 118–119, 131, 135 styles 1, 19, 71, 160 sub-processes 56 substance 165–166 subsystems 110, 124, 130, 143, 162–163

success 3, 5, 36, 39, 100–101, 113, 123, 125, 127–128, 150 summits 70, 74 supervisor management development 58 supervisors 19, 39, 41 supervisory 73, 83 supervisory level 73 suppliers 39, 43, 46, 72, 120, 126, 128 survey results 93–95 sustainability 22, 111, 127, 129–131, 167 systems model 107, 131 systems perspective 112, 122, 130, 143, 162 systems thinking 122 T table 4, 12, 14–16, 18–24, 29, 40–41, 67–68, 78–80, 82, 87–88, 91–92, 94–96, 110–111, 132–133, 159–160 talent councils 80 talent identification 35–36 talent management processes 82, 84 task-orientated 152 tasks 14, 20, 69, 72, 109–112, 132, 152 teamness 18–19 teams 3, 7, 14, 41, 72, 114, 116, 119–120 teamwork 113, 115 technical issues 43 template 12, 14–15, 18, 40–41, 45, 67, 79 temporary 72, 120 themes 20, 109–111, 132–133 themes of work complexity 20, 110–111, 132 theory of organisational culture and climate 13 theory of transcendental leadership 155 thinkers 116–122 thinking framework 123–125 time span 20, 111, 133 tools 39, 48–49, 55–56, 65–66, 68 validated selection 48–49 top 3–5, 19, 32, 35, 70–71, 113, 124

183

RESHAPING LEADERSHIP DNA FIELD GUIDE

topic session 71 top-performing 3 total number of leaders 96 traditional 63, 125, 128–129, 136, 141–142, 145, 155–156, 163, 166 trait 39, 146–148, 160 trait theories of leadership 146 transactional 4, 22, 100, 153, 155, 160 transactional leader 22 transcendental 4, 22, 154–155, 160, 166 transcendental leader 22 transform workplaces 113 transformation 121, 124, 156, 159 transformational 4, 22, 100, 153– 155, 158, 160 transformational leader 22 transformational leadership 153– 154 transformational work 100 transition 58–59, 64, 67–68, 133 smooth 67 transitioning to type 68–69 transmissional leader 21 trust 3, 21, 64, 73, 109, 121, 134, 152, 165 types 13–14, 25, 37–38, 48, 60, 80, 116, 141

uncertainty 22, 69, 109, 117 unit 53

wave 152, 161 wellness 163, 166 well-thought-through leadership capacity-building strategy 75 well-thought-through leadership strategy 5 wider 40, 70, 131, 137–138 work arrangements 139 contingent 139 work communities 138 work complexity 20, 110–111, 132 work domains 132 work environment 147 work ethics 140 work executive development 58 work of leadership 3, 162 work situation 123–124, 136, 162 work themes essential tasks time span 111 work theory 4, 36 worker treatment 105 workers 20, 111, 115, 119–120, 133, 136–137, 142, 156–157 workforce 136–137, 139, 152 working 4, 6, 32, 35, 58, 68–69, 113, 119, 135 workplace 51, 74, 94, 114–115, 126, 137, 139–140, 158, 164, 167 workplace cultures 158 workshops 7, 32, 60, 158 leadership strategy definition 7 work-type-specific 25–26

V

Y

validity 29, 43, 47–48, 80 value chain 30, 54–57, 92, 126 value creation 141 values 11, 13, 17–19, 23–26, 38, 51– 52, 62, 64, 101, 111, 115, 130–132, 154, 158–161, 165–166 values innovation 18, 115 various 4, 23–24, 28, 30, 35, 38, 48, 74, 77, 80, 83, 87–91, 112, 119, 145 vendors 43 virtual 60, 120–121, 126, 141 vision of organisations 136 vital 125

younger employees 140

U

184

W

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