This is Part 2 in a series of interviews with the gurus of leadership and management theory.
Jeffrey Gandz is a professor of strategic leadership at the Richard Ivey School of Business at the University of Western Ontario. The author of six books, his research focuses on the development of leaders in organizations. Click here to read an excerpt from Leadership on Trial: A Manifesto for Leadership Development.
What does it take to be a good leader these days?
Leadership in these complex and turbulent times requires an amalgam of competencies, character and commitment. We, of course, know a great deal about competencies – 90 per cent of leadership development over the past few decades has focused on competencies and skills.
But what is emerging as increasingly important is the emphasis on leadership character and encouraging people to use their values. That is the bigger challenge, both for practitioners and educators. Character seems to make a huge difference in whether people succeed or don't succeed in a complex environment.
The business world, some would argue, is a gigantic, complex system, which is hard to understand, and by the time you do understand, that system may have mutated anyways. Responsibility devolves to individuals to act appropriately in that fluid situation. So organizations must ensure those individuals had the proper fundamental character to make the right decisions and take the right actions as events occur.
You are less able to plan neatly what people in your organization are going to be doing 12 months from now. The key is how everyone acts in the moment, as circumstances arise. So the organization has to be much more value-driven, and leaders need to reinforce the values that you want.
So how do get those values throughout the organization?
I'll highlight three actions. One, we can be quite explicit and specific about the values that we want to see reflected in our business. That means spending time talking about specific situations that might develop and how we might use our values; when those situations occur, we attend to them, debrief, and talk about how we handled things. We reinforce the values that we want to see, and if we notice behaviours that are incongruent with those values, we call people out on their actions. We discuss it with them, and never miss the opportunity to emphasize what's important.
Secondly, we very clearly reflect those values in the people we hire and, in particular, in the people we promote. If you promote somebody who gets results but whose actions are not consistent with the value-basis in your organization, you send some really dreadful messages. The best companies consistently select people for promotion who model the values the organization wishes to express.
Finally, you have to be very selective in the development programs you put people through, so those efforts are consistent with the value framework.
I'll give an example. At Ivey, we get approached to offer leadership development programs for various companies. The first question I ask executives from the company is, "What is your leadership profile – what kinds of people are you trying to develop?" The company's leaders usually look at me blankly. I'll respond by stating, "You want me to design a leadership program – but for what?"
That usually initiates a wonderful discussion, and we end up agreeing there is a leadership profile they want that we can design to. But there should be much more attention in companies to that issue routinely. The really good companies have carried out a lot of thinking about the kinds of leaders they want and are quite explicit about stating the profile.
Those are three actions we can take around values. Beyond that, I should mention in any large organization I have ever worked in I found people who are emblematic of the traits, virtues and values the organization wants. If you use those people in your organization to mentor and coach others, that will help take you to where you want as an organization.
How would you respond to a manager who says, "You live in an Ivory Tower, Gandz, with this talk of meetings and plans on values. I've got to produce every day. It's fine to talk about values in the Ivory Tower, but we have a pretty good company here and I'm going to continue the way we've been going."
Depending on how insulting I wanted to be – or how insulting he was to me – I could note that they probably had that attitude at Lehman Brothers and at Bears Stearns in 2008, and probably at Bank of America recently. There are clearly managers and companies so focused on performing in the present that they have not considered building for the future. By contrast, there are other great companies that have always achieved that balance between performing now and building for the future, and they maintain a sense of proportion between those goals.
It is a matter of choice. If you allow yourself to be totally present-focused, and just do things that are expedient for producing immediate results, there is a consequence to pay. That's not an Ivory Towerism. We have our share of people in the academic world that do the same kinds of things that got people in the business world in trouble.
You have talked in the past about the seven deadly leadership sins.
That title was put on some research we carried out in late 2008 and early 2009, studying the financial meltdown from the perspective of what went wrong with leadership. We held what might be called focus groups with anywhere from 10 to 30 CEOs and C-suite level executives, discussing why some companies like Lehman and Merrill-Lynch ran into troubles and others like TD Bank, while affected by the meltdown, weren't involved in a whole lot of the troublesome practices.
In these discussions, the executives started to talk about leadership in terms of the seven deadly sins. They were saying, "Pride, envy, greed, sloth in terms of not doing your homework – all of those enormous, timeless problems with people have occurred in leadership during the financial crisis."
There aren't many new principles or fundamentals of leadership that have emerged since the Old Testament, New Testament, and maybe Lao Tzu. But the context continually challenges us around the fundamentals of leadership, and the context changes dramatically.
The huge and immediate reaction to the financial meltdown was to single out the role that greed played. The headlines were about greed, and the cartoons about greedy bankers. And sure, greed and enlightened self-interest was a factor. But you know many of these people. I know many of them. They don't walk around with green horns and tails – they have 2.3 kids, they support charities, they do good works, and they happen to be bankers as well.
So it's complicated. We found that greed was probably not the driving factor, whereas there was certainly overconfidence, and a heightened competitiveness among senior business people that at times got out of hand.
But there were also a lot of people who simply didn't do their homework, who relied on ratings agencies even though they knew problems existed with ratings agencies – people who were pushed to do things not because they wanted the wealth but because they were envious of those who had more and needed to be the biggest swinging dick in the room. That attitude infected whole parts of some businesses, yet other organizations kept things in perspective and weren't seduced by it.
I come back to personal character, and the need for organizations to take time for character development. In some organizations, when they see bad behaviour, they stop it.
The CEO of one organization I work with continually warns his staff, "Let's not do things we don't understand. Let's not get ourselves convinced we are totally better than everybody else all of the time. Let's retain some humility." That's the way he leads his organization, and he surrounds himself with people who have the same core beliefs and values.
Who do you read and turn to for management ideas – who excites you?
I read less and less about management of traditional businesses. I go through an enormous amount of biography in areas beyond business such as political and military biographies. The last biography I read was of Yasser Arafat, intrigued by how he led the PLO. It's not something I admire or envy, but I read it.
I read a fair amount of history. In business, I have read a lot of Niall Ferguson recently. I read the [Lawrence]Bossidys and Jack Welchs, but I don't get an enormous amount of inspiration from them. That's a function of age. After a certain number of years, there is a paucity of ideas, and you tend to see the same things recycled. I also don't get excited about reading how somebody built a company that has only existed for five years.
When I was conducting the research on the seven sins, I went back to read The Nicomachean Ethics. I read Socrates. What struck me is how contemporary that was. It's incredibly valuable to go back and read some of the old stuff, since it sheds light on today.
This interview has been condensed and edited.