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Is 'leadership' really a critical factor for corporate success?
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Performance Pointers

Is 'leadership' really a critical factor for corporate success?

Recently, a fellow consultant posted an interesting question on LinkedIn:

WHY is leadership important?

We hear lots on what leadership is, lots on how to develop leaders and leadership development, not so much on why leadership is important today.

It has been interesting to ponder this. Some people have said to me it is important as without it we would flounder, however with leaders developing at all levels in an organization things look a little different. Have we finally realized that people really ARE more important than hard, capital, financial assets and we lead people not things? Any thoughts on this?

Not surprisingly, most of the answers agreed that leadership is VERY important - except me, that is. Perhaps because I had just finished reading a book, that really made me look at, and think of, many so-called common truths in a very different light.

According to the authors of ‘Hard Facts, Dangerous Half-truths, and Total Nonsense’, Pfeffer and Sutton, leadership doesn’t have all that great a positive influence. Bad leaders can have a huge influence, though. But the difference between absolutely great companies and the mediocre ones is, so the evidence shows, at most attributable for a measly 10% to the quality of the leader(s). That leadership is all-important is one of the ‘dangerous half-truths’ that they discuss in their book. It’s true sometimes, particularly if the leader is a bad one (think Stalin, Hitler) but not really true otherwise.

And the evidence also points to business process as the critical component of success - not so sexy, perhaps, but think about it: mediocre performers can do very well with excellent processes, while even the most stellar and gifted people cannot perform well when forced to follow ineffective or dysfunctional processes. Replace a poor performer, and 9 times out of 10 the new person does not much better, because s/he is applying the same processes - which are muddled, convoluted, unwieldy, or bureaucratic. Or all of the former.

Most organizations are however extremely reluctant to tinker with their business processes, for fear of losing control. In unionized environments, even the staff (who complain bitterly about the ‘stupid’ processes) are lukewarm to the idea, because inefficient processes mean you need more people to get the job done. Fixing the processes often means triggering redundancies.

But I am convinced that good process is where it’s at. Fix the processes, and THEN hire good people.

Last updated on Oct 15, 2010 at 07:30 AM
Category: Consulting  Leadership Development  Book Reviews 
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