Leadership Beyond Old Boy´s Networks

In many traditional business cultures, the main criterion for business leadership was the social background as part of the establishment. Business competence - even the ability to read financial statements - was often an afterthought. And, by the way, the social order was led by "alpha males".

Now, we see some disturbing results from this selection of leaders out of the limited pool of the "Old Boy´s Network". Some of these highly praised "leaders" wreaked havoc with their entrusted companies.

Worst examples are Arcandor (Quelle), Constantia Privatbank, Citibank, GM, and more. After the fact it seems obvious that the leadership of these companies lacked management skills, personal integrity, or both.

Now, with a much more harsher business climate, owners and boards of companies need to look out for professional management talent. And they will need to tap into leaders that often do not conform to their "tried and true" stereotypes.

For example, women in boards still amount to less than 10%, here and here. Also, many countries only recruit out of their local networks. Or, they only consider graduates from their own university. In some countries, a key to a successful career still is the affiliation with a political party.

Leadership is not defined by background, color or gender, nor by other traits per se. Leadership is a question of results. In order to tackle the tough decisions of the next years, we need strong leaders that can deliver these results together with their teams.

Therefore, we need a more open minded leader recruitment approach. The criteria must include more than a nicely polished background and blind loyalty. Keys to success include the ability to face reality, the professional experience required for the job and the integrity to serve as an example.

And most likely, the best contenders are not only found within the Old Boy´s Network or Club rooms ....

Just 18% Happy With Own Leadership Performance

This result that just 18% of leaders are content with their own leadership performance was the outcome of a recent study by Dr. Seliger (PDF German). In addition, the conclusion stated two major shortcomings:

1. Leadership instruments are choosen without facts, on the basis of "gut feelings"
2. Lots of communication does take place, but it lacks plain-talking language

The consequences of this lack of performant leadership on the organizations are highly detrimental. Typical outcomes of bad leadership are: trends overlooked, growth targets missed, performance deteriorating, costs too high, employees demotivated, customers and owners disappointed, insolvency a clear danger.

The study uncovered some of the reasons, which conform with my experience. There are serious misconceptions that undermine performant leadership:

• Leadership is reduced to "charismatic" leaders, neglecting the process of leading
  
• Separation of thinking and doing, whereby the leader commands people to do (not to think, so they stop thinking)
  
• Disregard for genuine leadership work in favor of operational work (i.e. sales manager is his best salesperson)
  
• "Hero" conception of leadership versus the reality of daily housewife-type leadership chores to achieve consistent and sustainable results

These wrong myths of leadership prevent a more profound approach. What does such an approach need to contain? Here, my experience suggests not to fall into the trap to extend a "catalogue" of tasks or traits. Quite the contrary, less is more: principles come before attributes.

Sure, leaders need to follow standard work with high discipline, the core of leadership does not consist of tasks. The heart of leadership are the results delivered, which in turn means accountability for these results.

This may sound simple, but it requires the courage to define a clear vision on basis of personal responsibility. Especially in times of crisis, leaders are called upon to confront the new situation, investigate the reality and face up to uncomfortable truths. Not a job for the faint of heart.

Despite being in the center of social networks, leadership contains a lonesome responsibility and no consultant or clever method can substitute for standing up to it. Too often have we been fooled by the drappings of leaders, while the actual results then turned out to be dreadful.

Instead of impressing their stakeholders with results, these so-called leaders went through the motions of leadership only - in fact duping the public (i.e. just to mention the most famous: Enron, WorldCom, Tyco, Parmalat, Madoff, Bawag, etc.). More substance, measured in results, is needed for times like ours.

For our leadership practice we should bear in mind that your next most suitable leader may well come from a different class, a different country or a different gender than yours. But, he/she will be the one that delivers results. Take´m.

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