As much as I’d love to claim the need for leadership is unanimously accepted by all, I know it’s not.
When facing such opinion, I’ve learnt to do as I recommend to others when forming a view: flip the argument completely and argue the ‘other side’ before feeling fully secure in your own original argument.
Which poses the question: is leadership necessary?
The obvious case to make is that not all well-lead businesses have thrived, and not all thriving businesses have great leaders. Shoprite, a pan-African retailer based out of South Africa is certainly not known from standout leadership or progressive business practices, yet their performance over the long-term has been astounding.
Likewise, Theranos, the now-defunct privately held health technology corporation crashed and burnt in spectacular fashion after investigations proved the organisation was built on an intrinsically flawed product and what was essentially untruths. The business was led by the much interviewed, revered and referenced Elizabeth Holmes, who, in hindsight, skillfully combined investor deceit and a controversial blood testing phenom to build a billion-dollar organisation, largely through her leadership skill.
Considering these examples, I think there are a small set of circumstances where leadership is not a game-changing element in the short term:
- When a product or service is so far ahead of the field that growth takes care of itself, for example, Apple Inc.;
- When an inherited market position is so overwhelmingly strong that current leadership could not stop momentum even if they wanted to, for example, Berkshire Hathaway.
- When a cushy funding position negates the need for typical business performance, for example, Uber Technologies Inc. and
- When staff compensation levels are so excessively high that all other impediments to performance are circumvented, for example, in Investment Banking.
With that being said, it’s worth revisiting the question of the importance of Leadership to your current business.
This is obviously a question we at Lockstep engage our clients on fairly often. It’s an important question to answer, if for no other reason than to gain clarity on how leadership is a lever for your business performance.
Previously, the leadership of command-and-control companies could do what they liked without risking the loss of performance or staff. But those days are gone.
The truth of the matter is that the very nature of modern-day organisations makes leadership important. The fluid nature of today’s workplace, where the market is pretty efficient in helping employees come and go, means that organisations are relatively fragile and require leaders to direct, safeguard and hold it together.
If you are grappling with the value of leadership in your business, and in the interest of giving you a framework to shape your thinking, here’s how to value leadership (or not) within your business:
- Are you a business that places value on ‘Pillar Processes’ such as Culture, Strategy, Innovation, Engagement etc.?
- Are you a business that pays attention to performance – not just the tracking or profit, but creating conditions under which the business performs?
- Does your business value human capital as a core asset?
- Does your business’ have a clear and unwavering path forward?
- Does character matter to your business?
If the answer to the above grouping of questions is a strong ‘yes’ then it is highly likely that building leaders is a necessary investment for your business, for the simple fact that leadership shapes all of the above.
If, however, your collective answers are not a clear ‘yes’, then you might gain greater return by making other investments such as technology, process improvement, technical skill building etc. in the short term.
Without a doubt, every business has appointed leaders. The question, however, should be if those leaders are effectively steering the business forward or simply keeping the proverbial seats warm while the business progresses despite of them.
Contact Lockstep to have a more structured conversation about the leadership in your organisation.
If you have not partnered with a leadership development consultancy before, read this article here which will help you in your planning.