There is a need for a more holistic approach to overcoming organisational challenges, writes Roger Collins
An analogy, using our nation’s economy, will provide better insight into why reliance on and efforts to develop leadership in isolation from their organisation is destined to fail. The Australian economy is in transition. In fact, it is particularly vulnerable, as the status quo is rapidly losing its status. Mining is in bust mode; our taxation and superannuation systems are in need of fundamental overhaul; the RBA’s influence is waning as interest rates approach record lows; rumours of a housing bubble persist; and the findings of the 2015 Intergenerational Report demand decisive if not bipartisan attention if we are to maintain our standard of living. These issues reflect the systemic nature of any national economy. They also reflect the need for a holistic approach: there is no single solution that will resolve these problems. Calls for more effective leadership behaviour from our politicians is just part of the solution. More effective leadership may identify better pathways to our future and galvanise greater confidence and commitment to action for business, industry and the wider community, but this must result in the implementation of a whole series of structural and policy changes to bring about better outcomes when addressing organisational challenges.
“If clusters of organisational elements can lead to better performance, what are the clusters of HR policies and practices that HR leaders need to champion?”
In times of uncertainty and change, leadership – like cream in a milk churn – rises to the top as a solution to a plethora of problems. But it can become a classic honey trap. Consultants, trainers and academics who advocate leadership as an answer to our current organisational challenges are often overlooking the multi-causal nature of complex systems. So what might explain this tendency to oversell leadership?
A reality take on leadership
There are at least two possible explanations. First, advocating better leadership offers hope and simplicity. The risk is that given the complexity of factors that drive organisational performance, a one-factor explanation is seriously inadequate. As Albert Einstein observed: “Everything needs to be as simple as possible, but no simpler.” Second, much of the empirical research on leadership has relied on linear statistical (regression) analysis. Yet the factors that drive organisational performance can be multidirectional in their effects. Employee engagement can both influence performance and be influenced by it.
So, how does leadership play its part in enhancing organisational performance? Several decades ago the terms organisational “alignment”, “fit” and “congruence” received considerable attention in terms of their impact on performance. Maybe because these terms were never fads or advocated by high profile management gurus, they disappeared off the radar. Maybe in our quest for new, shiny insights, we discarded them, albeit unwisely. Yet many earlier insights like mechanistic and organic systems (Burns and Stalker) are just as valid today as when they were first introduced. We discard them at considerable cost.
“Those who advocate leadership or call for it can overlook the reality that leadership is only part of the answer”
Alignment and fit refer to a cluster of organisational elements that are congruent in the signals they send to members and mutually supporting in their impact. The whole thus becomes greater than the sum of the parts in its impact. And it is effective management and leadership who identify the important performance drivers that need to be clustered and aligned or consistent in their consequences.
Leadership in context
So, advocating leadership as a solution without due attention to the need for creating alignment in key elements of their organisation’s systems will seriously limit the effectiveness of leadership. Furthermore, leaders need to work on not just their leadership behaviour, but also the cognitive complexity that they bring to bear on identifying and influencing the systems and policies in their organisation that impact both performance and sustainability. Catherine Livingstone, an outstanding leader during her tenure at Cochlear, provides a tangible example. Catherine recognised that among other imperatives, a fixed percentage of revenue had to be committed to R&D each year to ensure the continued dominance of her firm in an industry with notoriously short product life cycles.
So, leadership is very rarely the solution to organisational challenges. Those who advocate leadership or call for it can overlook the reality that leadership is only part of the answer. Once appointed, leaders have to pay attention to not only their behaviour but the identification and alignment of the key drivers of their organisation’s performance and sustained success.
3 key leadership development questions
- How long can we continue to offer leadership development programs and experiences that consider just the character and behaviour of leaders?
- Do your leadership development initiatives focus on organisational design and culture, reward and control systems and other drivers of what you know to be drivers of both performance and sustainability?
- If clusters of organisational elements can lead to better performance, what are the clusters of HR policies and practices that HR leaders need to champion?
