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Integrity - The New Leadership Story – Part 1

 

By Ed Konczal

 

(This article is published by the permission of the author and is the 1^st chapter of a forthcoming book “Simple Stories for Leadership Insight” to be published by University Press of America/Hamilton Books)

 

This is a book about stories. The stories tell how leaders dealt with people, complex issues, and tough decisions. Some of the stories are sad, others uplifting and some are funny. Some stories involve a few people and others involve thousands. All give us important leadership insights. They all are real and you might find that a few relate to your own experience.

 

We both went through many leadership programs, seminars, books, articles and other leadership products. We found many of these well meaning but lacked capturing the complex context in which leaders live. We agree with Manfred Kets de Vries, one of today’s top Leadership Thought Leaders who said,  “The literature we find on leadership, though vast, isn't always helpful."

 

We found that the best leadership lessons were learned from experience.  We lived these stories and learned many lessons about leadership. But the key lesson and the one that seems to be a part of most of our stories is the absolute importance of Leadership Integrity. We learned that if leaders don’t have Integrity, nothing else matters much. (We use Integrity synonymously with Authenticity, Credibility and Trust.)

 

A quick search for the definition of Integrity surfaced the following --“Integrity comprises the personal inner sense of "wholeness" deriving from honesty and consistent uprightness of character”. This seems to fit, but the following from Howard Adamsky, from his article “A New Day for American Leadership” captures what Integrity means for Leadership, “…leadership is part vision, part art, part science, part experience, part faith and part know-how, all bound together in an ironclad package called integrity.”

 

Leadership is always important for Business success, but now Leadership with Integrity is critical. We are in the midst of a seminal change in the business environment  -- from the Information Age to the New or Knowledge Economy. Key for business success is leadership and organizational culture.  And yet the news is filled with CEOs who are falling from grace and there is talk of a “leadership crisis” and of “toxic cultures”.

	There has been a continuing erosion of trust across numerous business sectors in America according to the Golin/Harris Trust Survey.   Nearly 70 percent of survey respondents said, “I don’t know whom to trust anymore,” and said they will “hold businesses to a higher standard in their behavior and communications.”   February 2002.

 

 

 

 

 

 

 

 

But for those of us who have worked in corporate America, we’ve seen poor leaders in action daily. It just wasn’t news worthy in the past.

 

Despite much advice from the $15 billion Leadership Industry (business schools, seminars, books, tapes, journals), it seems that many so called leadership experts, business books and publications failed us.

 

q                              A major Business School had a business case on the success of Enron

q                              Bernie Ebbers and Ken Lay are profiled in a book on the best leaders

q                              In a major business magazine’s list of most admired companies for 2000, Enron ranked first in quality of management -- ahead of even GE. That ranking came from the votes of its peers.

q                              And look at what some management gurus said about Enron, before and after its collapse –

 

o                                       Professor 1 Before: "Leadership is not a solo act...it is a shared responsibility, a chorus of diverse and complimentary voices. To an unusual degree, [Enron] is chock-full o' leaders" After: "Egg all over the face is an understatement. As embarrassing as it is, we basically took the word of Lay and his people. Was there a way to spot that the emperor was wearing no clothes? I don't think so."

o                                       Professor 2 Before: "Skilling and Lay created `a hotbed of entrepreneurial activity and an engine of growth."' After: "There are absolutely some strong, helpful lessons to learn by what they did right. Unfortunately, all those are trumped by the mistakes they made."

o                                       Top Consultant 1 Before: "Enron isn't in the business of eking the last penny out of a dying business but of continuously creating radical new business concepts with huge upside." After: "Do I feel like an idiot? No. If I misread the company in some way, I was one of a hell of a lot of people who did that."

o                                       Professor 3 Before: "Skilling and others have led a transformation in Enron that is as significant as any in business today. This is brand new thinking, and there are broad implications for other companies." After: "History can't be very kind to it. It's sad: The innovation and ideas and what was good about what they did may be lost in the demise of the company."

Source BusinessWeek

 

We may be seeing the results of Business School-Media-Corporate complex. Perhaps in concept similar to the once Military-Industrial complex former President Eisenhower warned about in the 1960s –

 

“This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence -- economic, political, even spiritual -- is felt in every city, every State house, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.

In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

Public Papers of the Presidents, Dwight D. Eisenhower, 1960, p. 1035- 1040

 

This Business School-Media-Corporate complex seems to have engaged in a group think of enormous proportions – professors, consultants, journalists, students and executives all feeding on their own diets of best practices, theories and what defines leadership.

 

*        Business schools taught Ethics as a sideline.

*        Many companies have lofty Mission Statements and Operating Practice statements that address ethics, but do little to enforce them

*        Journalists give interviews to glitzy executives who brag about what they are doing to improve profits

*        Executives courted Wall Street analysts who might improve their stock ratings

 

Business is at a crossroads. Capitalism is facing a crisis. All of us who believe in business -- from CEOs to business-school professors -- must recognize that we have contributed to this crisis.   FastCompany  “Memo to: CEOs”, June, 2002   Not since the days of the insider-trading poster boy Ivan F. Boesky and the junk-bond king Michael R. Milken have M.B.A. programs been so assailed for their role in preparing future corporate executives. Many of the schools are scrambling to rewrite case studies, dust off their ethics lessons, and defend professors who have worked for the very companies now under scrutiny. The Chronicle of Higher Education September 20, 2002

 

 

 

 

 

 

 

 

 

 

 

The image of business leaders has been declining for some time. Starting in the early 1980s we began to see a seemingly endless parade of mindless downsizing, reengineering, reorganizing and inauthentic PR, all focused on satisfying the investment community. Corporate leaders seem to excel at Investor relations and fail in the vital relationships with their own people and their customers.

 

The damage caused by these poor leaders is too often hidden until it is too late. We need to examine business practices that lead to how these scoundrels got to their high office and identify the true characteristics of real authentic Leaders. After all, somehow these scoundrels got to the top, whether by promotion or approval by the Board of Directors.

 

This is the darker side of leadership. Manfred Kets de Vries has identified several of those shadows that leaders fail to recognize. One of these is “mirroring, or the tendency to see themselves as they are perceived by their followers and to feel they must act to satisfy the projections or fantasies of followers. A certain amount of mirroring is part of human existence. Our understanding of the world will always reflect some shared perceptions of what is real. But, in a crisis, even the best of us is likely to engage in distorted mirroring. The impact is most serious when leaders use their authority and power to initiate actions that have serious, negative consequences for the organization.”

 

Be careful of your “Mirror”.

 

We observed that as people moved up the corporate hierarchy, and received more and more perks, they became consumed with their own importance. Their position and rank became more important than just about anything else.  I remember one of my bosses who said,  “ you know why the guys at the top have such large offices? It is to house their huge egos.” Very few were able to resist the temptations and seductions of power. And they didn’t last long.

 

It takes real courage to be an authentic leader. You have to be willing to honestly look at and acknowledge your own weaknesses. To use Kets deVrie’s metaphor, look at yourself in a clear not a distorted mirror.

 

 

LEADERSHIP INTEGRITY LOST AND FOUND

 

LOST

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inauthentic leadership and poor relationships can cause great damage to an organization.  Perhaps the most telling, for us, was a multiple $Billion merger that was ill conceived and motivated more by bravado than business sense. It was a failure of colossal proportions that severely damaged the company’s financials and the lives of tens of thousands of good people. 

 

The head of a failing business unit was pushing the merger. Instead of being authentic and admit his BU couldn’t be profitable, he convinced the CEO and the leadership team to go ahead with the merger. The strategic planning team knew that the business we were buying wasn’t all that Unit Head thought it should be. One of our Graduate School professors once told us, after a case study was completed, “ all the Business Development strategic analyses are meaningless, what matters is who has the strongest guts in the Boardroom.” The activity turned hostile. We did the acquisition anyway. It didn’t take long for the financials to become a major disaster.  Cultures clashed, people were downsized. The culprits responsible for this disaster moved on, leaving bodies in their wake.

 

More insidious and perhaps just as damaging than this example are the smaller but more numerous examples of ineffective. inauthentic practices that we saw each day carried by so called leaders. Some of these are told as stories in this book.

 

In the story “To Leadership And Back” we tell the story of Tim, who was a true leader during a unique project. When the project was completed he yielded to the seductions that leaders face and regressed to an autocratic style. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In the story “Phil The Terrible”, read about an abusive leader and what happens to him in the end.

 

FOUND

	GE Chairman & CEO Jeff Immelt's Message to Employees As GE learns and grows in the 21st century, three traditions of Our company become more important. Along with commitment to performance and thirst for change, we must always display total, unyielding integrity.

 

 

 

 

 

 

In the July issue of weLEAD Online Magazine we will publish Part 2 of this article.

 

 

 

Comments to: editor@leadingtoday.org

 

 

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About the author:

 

 

 Ed Konczal  is a former leader of the Talent Alliance, a consortium of Fortune 100 companies to enhance members’ workforce employability and business growth. He has been instrumental in helping to lead organizations from start up to a globally recognized enterprise. Ed has been co-founder of the Resource Link, AT&T’s innovative contingent management unit. He has an MBA with Distinction from the Stern School (NYU).  Ed is author of 12 articles on various business topics.