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Effective Leadership in the 21st
Century – Part 2
By Michelle Holverson
Just as the idea of
who has leadership potential has changed over the last 50 years, so has the
concept of what makes an effective leader. As Mintzberg
(1998) states, “Where before managers needed to respond only to owners and
directors, now they find that subordinates with democratic norms continually
reduce their freedom to issue unexplained orders and a growing number of
outside influences… demand attention” (p. 12). Effective leaders today cannot
lead as their predecessors once did; a new type of leadership, servant leadership,
is defining how leaders manage subordinates. “As servant first, the leader
ensures that others' greatest needs are being met and bears the self-awareness
to realize that his or her own “healing” is the motivation for leadership”
(Mello, 2003, n.p.). Leadership today is about
listening and guiding subordinates, not scaring them into following direction;
but serving their needs so they are willing and capable to achieve corporate
goals. As Jeffery A. Mello(2003) goes on to say:
This
image of the servant leader is in stark contrast to the more traditional image of
the leader as a power-wielding authority figure. This “command and control”
paradigm is the basis for military leadership, which emphasize tenacity,
stamina, clarity, discipline, and mental toughness. [It has been] argued that
the traditional/industrial and military paradigms of leadership were
insufficient to explain the new realities of 21st-century leadership of the
kinds of leaders that these realities demand. (n.p.)
Servant leadership recognizes
the importance of the relationship between leader and follower and emphasizes
the importance of a business’ workforce. As Tichy and
Cohen state, “Winning leaders understand that their job is to take the human
capital, the most important asset of their institutions, and make it more
valuable for tomorrow's world” (1997, p. 190). Leadership today isn't about
controlling the power; it’s about applying the strength you have as a leader to
support those you lead. Palmer, Wall, Burgess, and Stough
(2001) affirm:
During
the last decade interpersonal skills have become more integral to effective leadership.
Where leaders were once seen to control, plan and inspect the overall running
of an organization, in today's more service-oriented industries, leadership roles
are also to motivate and inspire others, to foster positive attitudes at work,
and to create a sense of contribution and importance with and among employees. (n.p.)
It is clear that
leaders of the future must understand the concept of servant leadership for
organizational success.
A
contemporary concept very much associated with servant leadership, although not
as well explored, is emotional intelligence (EI). EI is, “described as a set of
abilities that refer in part to how effectively one deals with emotions both
within oneself and others” (Palmer, et al, 2001, n.p.).
The business world today is fast-paced, ever-changing and stressful; while
there has not been a large amount of analytical research done on EI, it is
logical that leaders who are successful in this type of environment are those
who are able to understand and manage not only the emotions of others, but
their own emotions as well. Palmer, et al goes on to say:
Today's
effective leadership skills have been described to depend, in part, on the
understanding of emotions and the abilities associated with EI. Emotional
Intelligence is about understanding the differences in individuals, how you
react to these differences, and the knowledge you have about yourself and the
different types of personalities existing. (2001, n.p.).
We have learned
through a variety of self-knowledge tests how important it is to know yourself;
emotional intelligence recognizes this concept and how it affects relating to
those you lead. Leaders who are able to understand themselves and recognize
their own strengths and weaknesses are better able to understand and accept the
strengths and weaknesses of others. Richard J. Leider
states in the article, “The Ultimate Leadership Task”, “Self-leadership…is
based on knowing yourself…Unless [leaders] understand the vision that motivates
them to lead, the purpose that ignites them, and the values that empower them,
how can they make courageous choices in a chaotic world” (1996, p. 192)? For
leaders to be successful in the current business environment they must
recognize the significance of emotional intelligence.
Credibility
is another critical issue facing business leaders today. As Kotter
states, "[A] big challenge in leadership efforts is credibility - getting
people to believe the message" (1998, p. 46). Due to the increasing
abundance of unethical business situations, credibility is and will continue to
be an important factor in effective leadership. Only individuals who are able
to establish mutual trust with those around them will make successful leaders.
Dave Ulrich (1996) goes on to say in the article “Credibility X Capability”:
Credible
leaders have the personal habits, values, traits, and competencies to engender
trust and commitment from those who take their direction. Perhaps one of the
best examples of this personal credibility is the leadership of Mahatma Gandhi,
who claimed, "My life is its own message." he said "you must watch
my life, how I live, eat, sit, talk, behave in general. The sum of all those is
my religion.” Gandhi believed that his personal life gave him the credibility
that enabled him to be a successful leader. (p. 215)
While business
leadership may seem far from that of the life of Mahatma Gandhi, the same
concept applies; credibility is gained through actions. Leaders must understand
the importance of following through on their promises and taking responsibility
when they cannot. From this notion, leaders must also recognize that
credibility is harder to gain the second time around; once credibility is lost
it may never be recovered. Leaders of the future must not only establish
credibility in their partnerships and with the people they lead, but they must
constantly work to maintain their credibility if they are to continue effective
leadership within their organization.
It
is from the importance of credibility that we discuss the next essential
element of effective leadership: ethical reasoning. As stated before, the
abundance of white collar crimes in corporate
A
review of the leadership literature reveals an increasing emphasis on the importance of ethical behavior on the part of
business leaders. [It is argued] that ethics and effective leadership are so
closely related as to be inseparable. A company's moral
health. depends upon the standards and the
example of its CEO. (n.p.)
Ethical reasoning
not only involves forming and using a business’ ethical standards, but also
creating and abiding by a personal ethical code as well. Business leaders
increasingly face choices that are not black and white; these situations cause
conflict between what a leader feels is ethically right and what may be best
for business. Joseph L. Baradacco (1998) recognizes
these situations when he states:
An
ethical decision typically involves choosing between two options: one we know
to be right and another we know to be wrong. A defining moment challenges us in
a deeper way by asking us to choose between two or more ideals in which we
deeply believe. Such decisions rarely have one “correct” response. We form our
character in defining moments because we commit to irreversible courses of
action that shape our personal and professional identities. (p. 91).
Leaders of the
future must have the strength and confidence to make these types of ethical
decisions. Businesses today and in the future will be less willing to stand for
unethical behavior; the damage it can do - devastating shareholder value,
smearing company reputation and ultimately destroying an organization - has
become all too evident. Baradacco (1998) goes on to
say:
As
I have interviewed and studied business leaders, I have found that the ones who
are most satisfied with the way they resolve their defining moments possess
skills that are left off most job descriptions. They are able to dig below the
busy surface of their daily lives and refocus on their core values and
principles. (pp.91-92)
It is clear that
strong morals and sound ethical reasoning will be essential to effective
leaders of the future.
While
the elements discussed so far have mainly dealt with leaders’ internal
competencies, we must also recognize a leader’s ability to inspire others.
Employee motivation is a serious challenge in businesses today; motivation
begins when leaders establish realistic and inspiring corporate strategies. As
such, an essential element of leadership, now and in the future, will be the
ability to create and instill a vision in the people they lead. What leaders of
the future must realize is that creating a corporate vision that employees will
follow is not out of their reach! It is about working with competent business
partners, strategically planning, and understanding the needs of the
organization's workforce and consumers. As Kotter
states, “The implication is that a vision is something mysterious that mere
mortals, even talented ones, could never hope to have. But developing good
business direction isn't magic. It is a tough, sometimes exhausting process of
gathering and analyzing information” (1998, p. 42). As future leaders we must
also realize that instilling a vision is more than just ‘selling an idea’ it is
about breaking molds and working with an organization’s workforce so that they
are as committed to the corporate vision as their leader. This also means
ensuring an organization’s vision supports the future of the organization and
avoids self-serving needs. “[Business leaders] can step forth onto society's
broad stage with a personal vision, they must make sure that their actions will
not jeopardize the well-being of their companies, the jobs of employees, and
the net income of shareholders” (Badaracco, 1998,
p.106). Kotter
affirms, “What's crucial about a vision is not its originality, but how well it
serves the interests of important constituents - customers, stockholders,
employees - and how easily it can be translated into a realistic competitive
strategy” (1998, p. 43). Future leaders must have the confidence to direct and
the capability to understand the needs of their organization to create
corporate visions their workforce will support.
Finally, one of the
most vital skills of future leaders will be their ability to adapt to change.
The business world has transformed dramatically, especially in recent years.
The accessibility of information, advancements in technology, and increase in
competition have created a cut-throat business environment that thrives on
change and being first to capitalize on the latest craze. These changes have
forced businesses to rethink and transform long-established corporate
strategies to adapt to a more erratic business world. Levi Strauss CEO Robert Haas
recognizes this shift in an interview with Robert Howard:
Traditionally
the business world had clear boundaries. Once you had a strong market position,
you could go on for a long time just on inertia. You could have a traditional, hierarchal, command-and-control
organization, because change happened so slowly. People's expectations for work
were also narrowly defined. As a result of all the tumult of the
1980s-increased competition, corporate restructurings, the globalization of
enterprises, a new generation entering the work force - those traditional
boundaries and expectations are breaking down. (1992, p. 35)
Clearly, business
leaders must be prepared for rapid and constant change; strategies that were
working for them yesterday may end up being their downfall today. Leaders
cannot merely accept that change is inevitable; they must recognize its value
and be capable of introducing and implementing change within their
organizations. As Tichy and Cohen state, “ In order for organizations to win, revolution, driven by
leaders with ideas and the heart and guts to bring them alive must become a way
of life” (1997, p. 24). Future leaders must have a high tolerance to ambiguity
and be capable of creating direction in times of uncertainty. They must be
skilled in change management and be able to balance bold ventures with
realistic business strategies.
It
is obvious that leadership has been greatly influenced by past changes in the
business world; these changes are far from over. Tichy
and Cohen state, “The only thing that never changes is the fact that everything
changes,” and it seems that change is happening more rapidly today than ever
before (1997, p. 24). To understand the future of leadership we must identify
the driving forces that continue to shape business leadership. Globalization,
which Dessler (2004) defines as, “the tendency of
firms to extend their sales, ownership, and/or manufacturing to new markets
abroad,” continues to radically transform the business environment creating
endless opportunities and challenges (p. 15). Businesses have progressively
learned that as they globalize their internal operations they must not discount
leadership as a global necessity. As Vesa Sutari (2002) states in the article “Global Leader
Development: An Emerging Research Agenda”:
The
existing studies indicate that typically companies do not have enough leaders
within global competencies and that competition for such resources will be even
more intensive in the future. As an outcome of the adaptation of global
strategies, the urgent need to develop leaders with global competencies and
perspectives has been widely recognized. It has been concluded that it is this
limitation in human resources, not unreliable or inadequate sources of capital
that has become the biggest constraint in most globalization efforts. It has
been estimated that there will be even intensified competition for competent
top management talent in international operations in future as well as in top
management positions in global organizations. (n.p.)
While business
globalization has been and will continue to be a constant driver in the
business world, effective global leadership has yet to be mastered in many
organizations. Companies will be vying to recruit leaders and managers with
global knowledge and experience who are capable of successfully managing
international competition, diverse workforces, and a foreign business
environment.
A
discussion of globalization leads to the next factor impacting leadership today:
increasing diversity in the workforce. The workforce today includes a wide
array of individuals all with their own values, opinions, strengths and
weaknesses. Groups that were once considered the minority are now considerably
increasing their presence in businesses; it is imperative that leaders
recognize this social transformation. For example, according to Sami M. Abbasi and Kenneth W. Hollman (1991):
By 2020, the size of the racial and ethnic
groups will have doubled. By 2056, these groups will outnumber the white
population. [Managers] must accommodate the needs of all workers --men and
women, white and minority, American born and foreign nationals, and young and
old --if they are to have a stable workforce, retain their competitiveness in
the cutthroat world of global markets, and meet the requirements of their role
in the community. (n.p.)
In an increasing global market
businesses are realizing the value of diversity within their organizations.
Ronald A. Heifetz and Donald L. Laurie state:
Different people
within the same organization bring different experiences, assumptions, values,
beliefs, and habits to their work. This diversity is valuable because
innovation and learning are the products of differences. No one learns anything
without being open to contrasting points of view. (1998, p.181)
Leaders of the
future must respond to the changing workforce and recognize and appreciate
diversity in the people they work with and lead. Technology, more specifically
the networking of information, is another driving force, which continues to
revolutionize business leadership. Mary
Lynn Pulley and Valerie I. Sessa (2001) state in the
article “E-leadership: Tackling Complex Challenges”:
The
digitization of information is fundamentally changing how we work, how we
organize work, and how we create value. This transition is creating a
tremendous amount of instability and churning in the workplace. It is requiring
organizations to shift from a mechanistic perspective, with emphasis on a
monolithic business s strategy and tight
boundaries around the organization, to an ecological perspective, where the
organization's boundaries are loose and permeable. (n.p.)
Businesses,
emerging and established, must continually modify their existing strategies to
remain competitive; leadership strategies are no different. Pulley and Sessa go on to say “In terms of e-leadership… the
foundational skills traditionally associated with leadership… are as important
as ever. However, adapting traditional leadership skills to a technologically--
mediated environment adds a layer of complexity that has not existed before”
(2001, n.p.). Future leaders can only expect that
technology will continue to create numerous organizational opportunities and
challenges; transforming the requirements of effective leadership.
The
traditional relationship between leader and follower is also dramatically
restructuring business leadership. Businesses are realizing the potential power
that lies with their employees. Employee empowerment, which Dessler
defines as “giving employees some degree of control over their jobs and
enabling them to employee suitable power to make their work lives more
effective,” allows business leaders to capitalize on the strength of their
workforce (2004, p. 305). Levi Strauss
CEO Robert Haas (1992) states:
There
[has been an] enormous diffusion of power. If companies are going to react quickly
to changes in the marketplace, they have to put more and more accountability,
authority and information into the hands of people who are closest to the
products and the customers. That requires new business strategies and different
organizational structures. (Howard, 1992 p. 35).
However, employee empowerment means more than
just assigning employees additional responsibility. As Linda Honold states in “A Review of Literature on Employee
Empowerment” (1997):
Individuals
must choose to take self-power or not. Leaders create an environment where
individuals are able to make that choice… Examples include creating a shared
vision; providing clear top-management support,…. redesigning work to reflect
collaborative norms; the use of job-enrichment; creative use of sponsorships,
role models, peer alliances, coaching, and mentoring; the development of reward
systems that build "win-win" rather than "win-lose"
attitudes; and identification and clarification of common goals…Simply
providing opportunities for employees to take power is not enough. Employees must
also chose to be engaged in those options. (n.p.)
For businesses to remain successful in the
future they will depend on leaders who have the ability to create an
organizational culture that encourages employee empowerment.
Finally,
the future of leadership will continue to be affected by the issue of corporate
social responsibility. Corporate social responsibility is, “the extent to which
companies should and do channel resources toward improving one or more segments of society other than the firm’s owners or
stockholders” (Dessler, 2004, p. 41). No longer can businesses operate without
considering how their actions affect the social responsibility they have to the
environment, to their consumers, and their partnerships. As Arnold Brown describes
in his review of “The New Rules of Corporate Conduct: Rewriting the Social
Charter” by Ian Wilson (2001):
One
of the important areas
When strategizing, leaders need to
consider more than just whether or not they are creating a profit for their
company and shareholders; they must also consider the moral impact of their
actions. Leaders of the future must continue to examine and control their
businesses operations to ensure that their organization’s social responsibility
is being upheld.
While it is clear
the business world continues to be defined by change, the need for effective
leadership remains the same. By examining leadership definitions, the
relationship between management and leadership and evaluating the current
impact of past leadership theories a basic understanding of the many aspects of
leadership has been gained. By identifying essential leadership capabilities
and the forces that continue to shape leadership future leaders are better
prepared for what lies ahead. Finally, as individuals attain leadership
positions within organizations it is imperative to recognize the importance of
fostering leadership back into our own organizations. As Kotter states: Just as we need more people to provide
leadership in the complex organizations that dominate our world today, we also
need more people to develop the cultures that will create that leadership.
Institutionalizing a leadership-centered culture is the ultimate act of
leadership. (1998, p. 53)
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About
the author:
Michelle Holverson (m_holverson@yahoo.com) is currently a
student of