Leadership – Do We Really Understand It?

We observe that some firms grow while others contract; some companies are immensely profitable while others hemorrhage cash; some gain market share and some lose it. Observing competitive outcomes is a bit like a physician taking a patient’s blood pressure, pulse, or temperature: One can say little more than whether the patient appears to be well or ill. To move from observation to diagnosis a physician must dig significantly deeper. What are the specific symptoms? In what combination do they appear? How persistent have they been and how severe? If the goal is industry leadership, restructuring and reengineering are not enough. To build leadership, a company must be capable of reinventing its industry; to rebuild leadership, a company must be capable of regenerating its core strategies (Hamel & Prahalad, 1994).

Economic difficulties need not mean that we lower our standards for leadership. If anything, we should raise is our sights. It is the job of leader how to manage in tough times in a way that avoids liquidation of human and cultural assets (Beer, 2009).

When you’ve got good leadership, families, businesses, schools, hospitals, communities, and governments thrive. Under poor or mediocre leadership, none of these enterprises fulfill their potential. Leadership, therefore, is everyone’s business. It is the business of choice, of making things happen, and of making a difference.

Leadership decisions and the development of good leaders are important in any age, but the changing face of business and government makes both more important today than perhaps they have ever been before. Managers everywhere face more turbulent times as they negotiate their way through a world of greater ambiguity and less certainty. In a study of chief executives at forty-eight firms among the Fortune 500 largest U.S. manufacturers, Wharton Professor Robert House asked two executives at each of the companies to assess the extent to which their own CEOs (I) were visionary, (2) showed confidence in themselves and others, (3) communicated high expectations, (4) personally exemplified the firm’s values, (5) demonstrated determination and courage. House then compared firms that experienced dynamic and uncertain environments with those whose contexts were more predictable. His finding: CEOs made a significant difference to profit margins for companies facing a world of change and uncertainty but far less for firms not so challenged (Useem, 1998, pg.8).

According to (Useem, 1998), one of the most effective way of preparing for challenges is by looking at what others have done when their leadership was on the line. By examining their experience and asking what they did and what they could have done, and by wondering what you would have done yourself, you can better anticipate what you should do when faced with your own leadership challenges (pg.3). He takes leadership to signify the act of making a difference. Leadership entails changing a failed strategy or revamping a languishing organization. It requires us to make an active choice among plausible alternatives, and it depends on bringing others along, on mobilizing them to get the job done. Leadership is at its best when the vision is strategic, the voice persuasive, and the results tangible.

Theorists interested in explaining or predicting organizational behavior have focused on a variety of factors, including employee characteristics, internal social structure and culture, formal organizational arrangements, leadership, technology, and the external environment. All organizations find themselves dependent, in varying degrees, on some elements in their external environments. If the dependencies are of some size, they can pose a threat to an organization’s survival and autonomy. A significant amount of organizational behavior that cannot be accounted for focusing entirely on internal factors (employee characteristics, leadership, social interactions and culture, or formal structure) can be understood if one recognizes how organizations tend to manage external dependence (Kotter, 1986).

Leadership: More talked than practiced

Leadership as a concept has interested psychologists, sociologists, political scientists, and management scientists. Significant efforts have been made by researchers since the 1920s to understand the concept of leadership. The more we research leadership, the more complexity comes to light. Leadership can be simply defined as the act of making an impact on others in a desired direction (Chaudhari & Dhar, 2006). In theory as well as in practice many authors and managers give a great consideration to leadership as one of the most important issue in theory of management and also in management as business function. So there are many definitions of leadership.

The statistics on published books and articles on the subject of leadership reveal exponential growth during the period 1970 to the present day. For example, there were twice as many articles being published per month in the years 2001-2 as there were per year in the equivalent two-year period three decades earlier (Storey, 2004). One estimate of annual corporate expenditure on the activity in the US put the total at some US$45 billion in 1997 – up from US$10 billion a decade before (Fulmer, 1997). One recent assessment of the overall picture in the US indicates that there are now 900 leadership programmes in colleges and universities in that country (which notably represented a doubling of supply over a fouryear period), over 100 ‘majors’ (specialist degrees), three dedicated journals, and many new professorial appointments (Sorenson, 2005). Research by the (Foundation, 2003) confirms what many suspected, namely that chief executives and board directors are still less likely than more junior colleagues to receive leadership coaching and tutoring. Only 25 percent of top echelon managers in the sample of 221 organizations had been tutored in leadership compared with nearly 50 percent of junior managers in the sample. As expected, the vast majority of senior managers (78 percent) espouse the value of leadership as a core organizational priority, but in practice they just do not seem to get round to doing much about it at the highest levels.

Calls for an understanding of leadership as complex and contextualized and for richer characterizations of leadership are becoming more audible (Collinson, 2005); (Kets, R., & Miller, 1991) (Stacey, 1999). Additionally, an increasing number of authors, both in organizational studies and in leadership and management studies (Cheney, The Rhetoric of Identification and the Study of Organizational Communication, 1983); (Cheney & McMillan, 1990) (Cheney & Tompkins, 1987); (Cummings, 1996); (Mintzberg, 1989); (Morris, 1997); (Tsoukas & Cummings, 1997) are producing theory and empirical research intended to be actionable, integrated, and contextualized.

For Machiavelli the sole purpose of leadership is power. The leader seeks to maintain his power and The Prince can be considered a handbook for staying in power. Should a leader be kind or cruel (Bowie, 2000). Jack Welch certainly appeared to use subordinates, if not solely as a means for his own end, then solely as a means to increase the wealth of GE shareholders (and at that Welch has certainly been successful) (Bowie, 2000).

Traditional theorists generally treated the leadership function as a relatively simple matter of downward dominance and headship (Weber, 1947). More current theorists generally view leadership as having much more to do with interpersonal influence and a broad set of contingent, situational forces (Hollander & Julian, 1969).

Today, social scientists are recognizing that the organizational influence of new sciences principles conform more to observable realities of social relationships than traditional theory. These principles point to unifying threads among the surface confusion of multiple acts by multiple actors, which have few easily discernable connections. These changes in thinking are perplexing and, perhaps, even frightening to some analysts – they threaten the foundation of organizational orthodoxy. Nevertheless, as elements of the new sciences become clearer, our grasp of leadership – past, present, and future – is deepened. Our ability to define and predict leadership behavior is enhanced (Fairholm, 2004). Traditional social science defined an organization characterized by control, prediction, measurement – in other words, by traditional management theory initially popularized by Max Weber, Frederick Taylor, and the like.

While concepts, rules and ideas may help guide a person in training, a true leader carries his/her mission in his/her heart – it is not external rules that make the person. The leader models the way not by following outer form but by seeing their work as their way of being (Cacioppe, 1997).

(Andrews & Richard, 1998) suggest that any resolution of the question “what is leadership?” must look within the mind of the follower to observe the process of influence (Andrews & Richard, 1998). Traditionally, the study of leadership has been closely tied to the study of the leader and his/her relationships with followers. However, recently there has been growing evidence that follower perceptions have an important role in determining leadership outcomes (Chen & Meindl, 1991) (Lord, Foti, & DeVader, 1984); (Shamir, Arthur, & R.J., 1994). Leaders are effective only as far as followers are willing to be led. Hence, there is considerable interest in determining how followers identify leaders and what factors influence these classifications. These results have led to a changing definition of the locus of leadership.

Some have argued that the leader is primarily an educator. As Newton points out, education can take place in two ways: some educators try to impose the correct beliefs and values in students. Others think education involves getting students to think for themselves (Newton, 1985). To be consistent with the kingdom of ends formulation of the categorical imperative, the leader is a decision proposer rather than a decision imposer. The leader in an organization can propose ends as well as means for reaching those ends. He or she can propose decision-making rules as well. But the leader should not order these things or impose them on the basis of his or her power. In management terms the leader creates the conditions for participative management (Bowie, 2000).

As (Piramal, 1996) writes, the more she learnt about the business, the more she became convinced that management decisions are based on personal experiences, aims and vision of one person. Usually, it is the head of a business house or the chairman of a company, but sometimes crucial decisions can be taken by unexpected people in the organization.

What separates the episodes of excellence from those of mere competence? In striving to tip balance toward excellence, we try to identify great leaders’ qualities and behaviors so we can develop them ourselves. Nearly, all corporate training programs and books on leadership are grounded in the assumption that we should study the behaviors of those who have been successful and teach people to emulate them. But my colleagues and I have found that when leaders do their best work, they don’t copy anyone. Instead, they draw on their own fundamental values and capabilities – operating in a frame of mind that is true to them yet, paradoxically, not their normal state of being. I call it the fundamental state of leadership (Quinn, 2005).

It is ironic that our basic image of the leader is so often that of a military commander, because – most of the time, at least – military organizations are the purest example of an unimaginative application of simple reward and punishment as motivating devices. When a leader succeeds, it will be because he has learned two basic lessons: Men are complex, and men are different. Human beings respond not only to the traditional carrot and stick used by the driver of donkey but also to ambition, patriotism, love of the good and the beautiful, boredom, self-doubt, and many more dimensions and patterns of thought and feeling that make them men. But the strength and importance of these interests are not the same for every worker, nor is the degree to which they can be satisfied in his job. An understanding leader will not let his workers think that he considers them inferiors, but he may be wise to maintain a kind of psychological distance that permits them to accept his authority without resentment (Prentice, 1961).

What leaders shall do?

Leaders need to be in tune with the psychological weight of work and be aware of the level of unease that “not knowing” generates. Unease can soon slip into worry and anxiety and leaders need to be aware of an increase in their emotional state. They need to be able to develop a relationship with uncertainty where there is a clear awareness of the level of concern but not such that it impedes decision making either through analysis paralysis or over- hasty action designed to reduce tension. Their self-awareness frequently includes an increasing sense of what they do not know, of what their experience does not teach them, of how much they still have to learn and, without any false modesty, how little they have yet achieved (Connor & Mackenzie-Smith, 2003). For any leader, in treating people as people it is useful to consider the four Ms: people are makers of meaning and of decisions; members of technical/professional groups, communities, families; each person is an irreducible mystery; and treating people as people is messy.

Leadership cannot be summed up by a list of action points. Leadership is an active interaction with the world and involves bringing into being new possibilities from within real constraints (Connor & Mackenzie-Smith, 2003). If tomorrow is not the same as yesterday, what do leaders draw upon to help guide them to make wise decisions? Clearly, past experience cannot be the whole answer. The question of what it takes to be a good leader has been the subject of much thought and research – and the recent increase in interest coincides with the step changes in complexity many organizations face (Connor & Mackenzie-Smith, 2003). We live, lead and work in an era of contradictory forces. The waves of change sweeping the world – including digitalization, globalization, demographic shifts, migration and the rapid degradation of social and natural capital – are creating opposing tensions (Connor & Mackenzie-Smith, 2003). As they noted that Humanistic psychology placed an emphasis on the leadership values such as teamwork, mutual appreciation and dialogue ; Behavioural psychology and the competency approach have attempted to identify what leaders do and how they act; Personality theories have attempted to identify personality types and combinations of traits that leaders have in common ; Situational leadership is based on the idea that there is not one preferred style of leadership – the most appropriate one will depend upon the situation that needs to be faced; Emotional intelligence suggests that genuine leaders have to be emotionally intelligent as “they create resonance in those they lead – a reservoir of positivity that frees the best in people”; Comparing and contrasting “leadership” with “management” has sought to differentiate leadership.

The successful executive was generally pictured as possessing intelligence, imagination, initiative, the capacity to make rapid (and generally wise) decisions, and the ability to inspire subordinates. People tended to think of the world as being divided into “leaders” and “followers.”. Some of the more enthusiastic alumni of these training laboratories began to get the habit of categorizing leader behavior as “democratic” or “authoritarian.” Bosses who made too many decisions themselves were thought of as authoritarian, and their directive behavior was often attributed solely to their personalities. Often they are not quite sure how to behave; there are times when they are torn between exerting “strong” leadership and “permissive” leadership. Sometimes new knowledge pushes them in one direction (“I should really get the group to help make this decision”), but at the same time their experience pushes them in another direction (“I really understand the problem better than the group and therefore I should make the decision”). They are not sure when a group decision is really appropriate or when holding a staff meeting serves merely as a device for avoiding their own decision-making responsibility. According to them, the successful leaders are those who are keenly aware of the forces which are most relevant to their behavior at any given time. They accurately understand themselves, the individuals and groups they are dealing with, and the company and broader social environment in which they operate. And certainly they are able to assess the present readiness for growth of their subordinates.  But this sensitivity or understanding is not enough, which brings us to the second implication. Successful leaders are those who are able to behave appropriately in the light of these perceptions. If direction is in order, they are able to direct; if considerable participative freedom is called for, they are able to provide such freedom. Thus, successful managers of people can be primarily characterized neither as strong leaders nor as permissive ones. Rather, they are people who maintain a high batting average in accurately assessing the forces that determine what their most appropriate behavior at any given time should be and in actually being able to behave accordingly. Being both insightful and flexible, they are less likely to see the problems of leadership as a dilemma (Tannenbaum & Schmidt, 1973).

Organizational viability depends in part on effective leadership. Effective leaders engage in both professional leadership behaviors (e.g. setting a mission, creating a process for achieving goals, aligning processes and procedures) and personal leadership behaviors (e.g. building trust, caring for people, acting morally) (Mastrangelo, Eddy, & Lorenzet, 2004). From traits (Stogdill, 1948) and behaviors (Fleishman, 1953) through contingency theory (Fiedler, 1967) and situational theory (Hersey & Blanchard, 1977) to transformational and charismatic leadership (House, 1977), researchers have long attempted to understand the determinants of effective leadership.

It is an extraordinary ability of a leader to know the mind of his/her followers and to act precisely and wisely at the time – for the good of both the task and the follower. Another one of the key essential skills those are necessary for the development of a leader – the ability to be in the present – to see what is happening without preconceived ideas or distractions. Almost everyone is so involved with his/her own thoughts that they don’t experience what is actually going on around them. The average person has about 100 thoughts per minute which means about 6,000 thoughts per hour. Over the course of a day, this would be about 100,000 thoughts! An essential characteristic for a leader would be to be in the present – for him or her to be able to focus on the current situation without inner self-talk, preconceived ideas and distractions that might interfere with him or her listening and seeing accurately what the situation is. Socrates, one of the major philosophers of western culture shows that the wisest people are those that know when they do not know (Cacioppe, 1997).

Of course, we need people to measure and control some aspects of our organizations, but the leader’s job is to be attuned to the qualitative factors. These are the things that make an organization what it is and what it can be. To do this, leaders must learn to measure what can be measured and not measure what actually cannot be measured. Leaders recognize that the very essence of the organization is not the organization chart or the financial statement, but rather consists of the intangibles and un-measurables of culture and vision and values. When leaders get on the balcony, understand the creative destruction cycle, and lead people through transitions, the ambiguities of organizational (and political) life become less mysterious. The key is to learn to ask the right questions and remain open enough to learn that the apparent paradoxes and the twists in organizational planning are valuable lessons that help us move closer to our goals. Leaders understand the role of relationships and meaningful interactions. Leaders dismiss the fallacy that total organizational control is possible, while retaining the idea that leadership has a very significant role to play in shaping and guiding individual and group behavior. Using a vision field, leaders shape the overall feel and structure of the organization, council-with others, adopt a few simple principles and encourage independent implementation of them, confident that the organization (and the individuals within it) will flourish and grow (Fairholm, 2004).


The following principles may guide a leader as he or she attempts to transform an organization into a kingdom of ends:  1 The leader should consider the interests of all the affected stakeholders in any decision it makes. 2 The leader should have those affected by the firm’s rules and policies participate in the determination of those rules and policies before they are implemented. 3 It should not be the case that the leader always gives the interests of one stakeholder group priority. 4 When a situation arises where it appears that the humanity of one set of stakeholders must be sacrificed for the humanity of another set of stakeholders, the leader cannot make the decision on the grounds that there is a greater number of people in one stakeholder group than in another. 5 Every leader must in cooperation with others in the organization establish procedures to ensure that relations among stakeholders are governed by rules of justice (Bowie, 2000).

As rightly said by (Goffee & Jones, 2005), leadership demands the expression of an authentic self. Try to lead like someone else – say, Jack Welch, Richard Branson, or Michael Dell – and you will fail. Employees will not follow a CEO who invests little of himself in his leadership behaviors. People want to be led by someone “real.”  Leaders and followers shall both associate authenticity with sincerity, honesty, and integrity.


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