‘You choose your leaders and place your trust/As their lies wash you down and their promises rust’ (Paul Weller)
What do we expect from our managers and leaders? Judgement and insight, or conviction and ideology?
It’s a question raised in Jonathan Freedland’s weekend piece Chris Huhne, David Cameron and the RBS boss don’t have it, but Al Gore did – asking whether we prefer jaw-jutting certainty to thoughtful judgement in our business and political leaders.
A weighty question. I guess most of us want decisive leaders and managers, the kind of people who know how to sort things out and get things done. And people who can read the signs and adapt. Yet is that what we get?
Freedland asks if it’s right that the RBS chairman says “I think it’s true that we underestimated the scale of the public reaction to the bonus award” – a poor judgement call. After all, shouldn’t someone with his experience and insights have known that? He also raises similar questions over the judgement of Mandelson and Greenspan, both admitting that they didn’t foresee the economic mess that we were heading in to…even though the signs were there. Certainly strong enough signs and warnings that should merit investigation from people who hold high office, and reap the rewards that come with it.
Business examples appear regularly – take the recent Kodak example. Why didn’t the people at the top see that their market was changing and that they were ill equipped to survive? Whose job is it to hold them to account – shareholders or employees? Or was their confidence (even optimism) enough to satisfy those who relied on their judgement for their income.
With high pay and rewards very much on the public’s agenda maybe it’s a good time to ask what type of leaders we expect for those rewards. Are we happy to believe in the conviction leader who asks us to trust their judgement? The alpha confidence as Freedland calls it.
Or are we really looking for sound judgement, which probably brings a less self-assured tone with it?
What do you think?
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When you live in a bubble, that is all you know. If, for example you have 2 large dogs in your household then you house is likely to smell of dogs. You won’t notice the smell as you will be used to it. Even when you pop out to work or for a night out you won’t notice it when you come back. It’s only when you leave it for an extended period of time that you notice it smells of dogs. However, when someone visits they can smell it but are mostly too polite to mention it.
Why would you be oblivious to it? You know you have dogs. You know that they smell when you put your nose up close. Perhaps you don’t get out enough or maybe you don’t actually care.
This is the organisational problem we have here. It’s not about jaw jutting certainty or thoughtfulness really, it’s about being in touch. Someone who is payed more in one year than their average worker earns in 5 lifetimes and who has a personal fortune equal to that of a small county GDP will be out of touch. Their lives are spent on planes, in chauffeur driven cars or on sunseeker yachts, mingling with other “dog owners”.
I wager £1000 that if you interviewed a cross section of the rank and file employees at Kodak there would be a high proportion of people saying “we could see it coming” “no one at the top seemed to listen”. It’s an all too common story. In fact it’s been going on over at RIM for the last few years.
We underestimate things largely because we are not close enough to the situation or individual to understand. It’s not rocket science. But until the “dog owners” understand that, the house will continue to smell and they will remain oblivious.
No leader is perfect – nor should we expect them to be. They will make mistakes as everyone does. But when mistakes are made due to an inability of the boss to accept stakeholders opinions, or to ignore a great swathe of pressure from stakeholders, thinking that they know best, then it is time to question their ability to lead. It is a leader that we want, not a dictator. A leader needs to be decisive – but formulate their decision based on all the facts, including stakeholder opinion.
It is also important for stakeholders not to be too reverent. Leaders do get things wrong and need to be told. Plymouth Argyle rose through the leagues to the heady heights of 4th in the Championship under a dedicated group of local small businessmen. Most fans were more than happy when two industry leaders took control of the football club. Sir Roy Gardner became Chairman and Keith Todd CBE became Executive Director. What followed was three years of hell – the club fell from the top half of the Championship to bottom of League 2 – went into Administration with debts of £18 million and was in a whisker of going out of business completely.
They didn’t listen, they didn’t understand the club, the local region, the place of the club in the community. But worst of all when things weren’t going right they continued on their disastrous path.
Leaders – listen, understand and be aware.
Great post Mervyn.
Agree with Gareth in that this is a systemic issue, and rather than focus on individual leadership traits, you can gain more by looking at the structure of business, especially at the structure of the executive within those businesses, that allow these types of outcomes to result.
Bubbles can be popped, and – perhaps inevitably – it is the German’s that have the solution to it . Workers are represented directly at board level through the policy of Mitbestimmung or Co-determination. The presence of representatives of the employee base has a braking effect on C-Suite remuneration, and stops runaway compensation before it develops momentum.
We’ve studied it ourselves during the 1970’s at the height of the Winter of Discontent, but we of course we opted for Maggie at the time and….well, here we are.
Research shows that many senior leaders have sociopathic personalities – which gives us the organisations we have. And the move to focus on shareholder value in the early 1980’s coupled with economists who said that hyper-reward would produce hyper results (although again research shows the more you pay the more performance deteriorates) has got us into the situation we are in today.
Given that societal values have changed significantly over the past 30 years there is every chance they could change again and we could see a move back to fairer distribution of wealth and an emphasis on corporate responsibility. We just need to keep pushing for it.