Are Organisations Good at Learning?

Francesca Gino and Bradley Staats highlight how “our traditional obsessions – success, taking action, fitting in, and relying on experts actually undermine continuous improvement. Virtually all leaders believe that to stay competitive, their enterprises must learn and improve every day. But even companies revered for their dedication to continuous learning find it difficult to always practice what they preach. Consider Toyota: Continuous improvement is one of the pillars of its famed business philosophy. After serious problems in late 2009 led Toyota to recall more than 9 million vehicles worldwide, its leaders confessed that their quest to become the world’s largest automobile producer had compromised their devotion to learning,” (p.111-112).

 

If one looks at the media these days when they report on business, everything is short term – they aren’t interested in organisations that have a long term view, they only seem to be interested in reporting “success” now. This in itself has undermined how many organisations view real success, and how too often organisations ‘sing’ to the tune of the press, terrified of even the slightest hint of failure. But if we look back on our lives, how much did we learn growing up through the mistakes we made. In fact wasn’t that some of the fun of our youth – to experiment as a way to learn, where success or failure was a positive experience to learn something from? We’re not talking about the irresponsibility of youth – but of that pioneering spirit that lives within us all.

 

To support this thought Gino and Staats (p.112-113) ask “why do companies struggle to become or remain ‘learning organisations? Through research conducted over the past decade across a wide range of industries, we have drawn this conclusion: Biases cause people to focus too much on success, take action too quickly, try too hard to fit in, and depend too much on experts. Leaders across organisations may say that learning comes from failure, but their actions show a preoccupation with success. This focus is not surprising, but it is often excessive and impedes learning by raising four challenges;

 

Challenge #1: Fear of Failure. Where organisations don’t develop new capabilities or take appropriate risks, unless managers tolerate failure and insist that it be openly discussed.

 

Challenge #2: A Fixed Mindset. People who have a fixed mindset aim to appear smart at all costs and see failure as something to be avoided, fearing it will make them seem incompetent.

 

Challenge #3: Overreliance on Past Performance: When making hiring and promotion decisions, leaders often put too much emphasis on performance and not enough on potential to learn.

 

Challenge #4: The Attribution Bias: It is common for people to ascribe their success to hard work, brilliance, and skill rather than luck; however, they blame their failure on bad fortune. This phenomenon, known as the attribution bias, hinders learning.

 

Yet the years have not been kind to risk taking and the pioneering spirit and in today’s so called modern world the fear of failure is often learnt long before one starts a career in business and in a sense goes against the inquisitive nature of us human beings. Not that long ago, the men and women who pioneered so many incredible inventions and discoveries, actually embraced failure. We know the story of Edison and the invention of the light bulb – and just how many attempts it took him to find the right solution. Yet one has to wonder if Edison would ever had invented the light bulb in today’s unforgiving business environment? But the fact that one might have to think just for a moment as to whether Edison would have survived in today’s ‘success only’ business environment should be cause for concern.

 

But is it really external factors, like the media, that defines an organisations cultural approach to failure or is it how their leaders respond to the external environment and how much they believe that they control their organisations destiny and decide to embrace failure as part of their positive culture – rising above even their ego’s.  

 

Gino and Staats give this example; “consider professional soccer goalkeepers and their strategies for defending against penalty kicks. According to a study by Michael bar-Eli and colleagues, those goalkeepers who stay in the centre of the goal, rather than diving to the left or the right, actually perform the best: They have a 33.3% chance of stopping the ball. Nonetheless, goalkeepers stay in the centre only 6.3% of the time. Why? Because it looks and feels better to have missed the ball by diving, even if it turns out to be the wrong direction, than to have stood still and watched the ball sail by,” (p.114).

 

We live in a world where, sadly, there are too many people just waiting for business organizations to make a mistake – it’s a quick easy story – but this vulture like approach to failure is probably having a major detrimental impact on the true potential progress of too many organisations around the globe. Organisations that are spending too much time and effort worried about failure – when it’s failures that will actually take them to the next level.

 

Gino and Staats conclude by stating that “it may be cheaper and easier in the short run to ignore failures, schedule work so that there’s no time for reflection, require compliance with organizational norms, and turn to experts for quick solutions. But these short-term approaches will limit the organisations ability to learn. If leaders institute ways to counter the four biases we have identified, they will unleash the power of learning throughout their operations. Only then will their companies truly improve continuously, p.118

 

References:

 

Gino, F. and Staats, B. (2015). Why Organizations Don’t Learn. Harvard Business Review. November, p.110-118.

Are Western Organisations Prepared for Global Economic Change?

We instinctively create our expectations around our past experiences – but what if our past experiences are no longer a predictor of future behaviour – how easy is it for us to re-position our future expectations to a state we’ve actually never experienced before? This is the state of the global economy – which is predicted to change in the next ten years to a state we’ve not experienced for over 30 years, i.e. to a state many people simply have no experience of, other than through economic history books.

 

In October 2015’s Harvard Business Review, Richard Dobbs, Tim Koller and Sree Ramaswamy highlight how “North American and Western European companies now capture more than half of global profits, and measured as a share of national income, are at their highest level since 1929. It has been a remarkable era, but it’s coming to a close. Although corporate revenues and profits will continue to rise, the overall economic environment is becoming less favourable, and new rivals are putting the Western incumbents on notice. Many of the new players are from emerging markets, but some are surprise intruders from next door, either tech companies or smaller-technology-enabled enterprises. These competitors often play by different rules and bring an agility and an aggressiveness that many larger Western companies struggle to match. In this new world, corporate performance will no longer outpace the global economy. We forecast that in the decade ahead, although operating profits will continue to grow in absolute terms, they will fall to 7.9% of global GDP – around what they were when the boom began,” (p.50).

 

The impact this has on the world, especially the Western world, cannot be underestimated as the upcoming changes will, for example, require organisations to be visionary and innovative enough to see the errors of many current business ‘philosophies’ and ‘consulting’ interventions and will require organisations to be open enough to develop and implement ‘business principles’ that are ‘new’ – in that they will actually shape organisations for a future state, that many organisations and their respective boards may not believe is coming.

 

Just this ‘small’ strategic re-alignment will create significant opportunities for SME organisations to take significant leaps forward against established larger organisations who, like a large tanker, are often much slower at responding to a future state, significantly different to what they are expecting and planning looking for.

 

But it’s not just organisations that are going to need to re-adjust, employees are going to have to re-adjust as well to the changes to come as they will have to re-align their own career and salary expectations. Some will rightly argue that employees in many countries are already battling with having had to except lower salary levels and lower salary increases, less than the annual increase in the consumer price index, leaving them with less consumable income year-on-year – where the counter argument to this hypothesis is that employee expectations were that the global financial crisis was just a ‘phase’ that they would have to work through and that the good ‘old’ times would return again – and the fact that salary levels may never go back to what they were, may be something many employees find hard to swallow.

 

On a global scale, we’re already seeing large Western corporates laying off thousands of people in 2015 – and these events, though reported as single events, have not yet been reported at the cumulative level and when they are many employees in Western organisations will start to sit-up and be more concerned for their own future stability and welfare.

 

Dobbs, Koller and Ramaswamy suggest that “the challenge facing big North American and European companies is to maintain and even extend their lead in the face of much tougher and more varied competition and a less favourable environment. Half of the worlds GDP growth over the next decade, and many of the new competitors will come from smaller cities in the emerging world – places such as Kochi and Kumasi – places that most Western executives would be hard-pressed to locate on a map. Even the most global firms retain a strong local bias in their operations, making close to half their revenue at home. The local market also influences how firms choose to innovate; the products they create, their supply chains, and their investment strategies. For Western executives, an ‘emerging market’ view or even a view of the ‘Chinese’ or ‘Indian’ market is not enough,” (p.60).

 

Accepting a complete change to how Western organisations approach business in the not too distant future will definitely sort out the exceptional leaders from the mediocre. But the fact that many Western jobs in the large corporates will be in the hands of their leaders, should make both employees and stakeholders stand up and start, maybe genuinely for the first time – to truly question the capabilities and vision of their organisations executive leadership.

 

Though tough times are ahead – as always there is a great opportunity to put right one of the greatest errors of the first decade and a bit of the 21^st century – and that is to not only make leaders truly accountable for their actions – but to identify who the best leaders are, not just for the ‘now’, but for the sustainable future of your organisation – as they could hold your future in their hands. 

 

So in conclusion Dobbs, Koller and Ramaswamy suggest that “North American and European multinationals have enjoyed an exceptional three-decade ride, and they have plenty of reasons to remain upbeat as they look ahead. But to maintain or increase profits, they’re going to have to shake things up. The competition will be relentless and less predictable, and the operating environment not nearly as supportive. Vigilance, agility, and optimism have always been prized characteristics of successful companies; but over the next decade they will have to be doubly so…..” (p.62).

 

References:

 

Dobbs, R., Koller, T. and Ramaswamy, S. (2015). The Future and How to Survive It. Harvard Business Review, October, p.48-62.   

What’s Happened to the BRICS Countries?

Malcolm Scott highlighted in Bloomberg News back in July this year how “the combined economic output last year of Brazil, Russia, India, China and South Africa (the BRICS nations) almost matched the U.S.’s gross domestic product. Where back in 2007, the U.S. economy was double the BRICS.”

 

"Despite some disappointments in some of the BRIC economies, led by China and India, their collective weight in global GDP continues to rise and therefore also does their importance," said Jim O’Neill, the former Goldman Sachs Group Inc. chief economist who coined the acronym back in 2001, without South Africa.

 

Yet are the BRICS countries really as strong as some would like to make out and are Brazil and South Africa leading the pack in beginning to go backwards after such a great start and such an opportunity for genuine prosperity for their respective countries?

 

As of 30th September Standard & Poor's credit rating for South Africa stands at BBB-; Moody's rating for South Africa sovereign debt is Baa2; and Fitch's credit rating for South Africa is BBB. Where for those not in the know a credit rating is used by sovereign wealth funds, pension funds and other investors to gauge the credit worthiness of countries like South Africa, thus having a big impact on the country's borrowing costs.

 

In an article in the Economist (29th August 2015) they report how “during the global commodity boom before the 2008 financial crisis South Africa’s mines struggled to expand because of underinvestment that led to bottle necks at ports and on railways. Some reckon the country’s coal and iron ore mines could have increased their exports by as much as 50% had they had the means to get their minerals out to international markets.”

 

Now in August 2015 the dire economic news released for South African showed the economy had shrunk at an annual rate of 1.3%. The Economist forecasts that “this will be a problem for some time to come with foreign investors wanting to build power-hungry factories being asked to come back in a few years. Few will bother.”

 

Also in South Africa many state owned firms are racking up huge loses. Petro SA, a national oil company, is about to post a loss of about 15 billion Rand, ($1.1 billion), the largest ever by a state owned company in South Africa.

 

Worse still for this once promising BRICS country since “the left’s grip on government has grown even tighter. Most new plans for the economy are now drawn up by two communists, Ebrahim Patel, the economic development minister, and Rob Davis, a trade minister who doesn’t think much of trade. Their model is China. An ANC policy document gushes that the economic ‘leadership of the Communist Party of China….should be the guiding lodestar of our own struggle.’ Many of the ANC like the idea that the ruling party should control business directly, and China’s recent troubles probably won’t change their minds.”

 

Bloomberg reported on 10th September 2015 how Brazil’s sovereign rating was cut to junk by Standard & Poor’s, taking away the investment grade the country enjoyed for seven years, as President Dilma Rousseff’s struggles to shore up fiscal accounts amid a faltering economy.

 

Brazil’s rating was reduced one step to BB+, with a negative outlook, S&P said in a statement after markets closed. Brazil’s largest U.S. exchange-traded fund tumbled 6.6 percent in late trading along with American depositary receipts for Petrobras, the state-controlled oil company.

 

The downgrade, and S&P’s warning that another cut is possible, puts pressure on Brazil’s economic team led by Finance Minister Joaquim Levy to win passage of measures that would shore up the country’s fiscal situation by cutting spending or raising taxes. Rousseff has been unable to find support for her initiatives amid an investigation into corruption at the state-controlled oil company that allegedly occurred while she was its chairman, sending her popularity to a record low and generating calls for her impeachment.

 

“The downgrade could be a wakeup call but the political situation is so bad that it’s difficult to resolve, so it’s a dark path ahead,” Daniel Weeks, the chief economist at Garde Asset Management, said from Sao Paulo. "Markets will take this as a negative, and it will probably drag down emerging markets at a global level.”

 

Standard & Poor's credit rating for Russia stands at BB+; Moody's rating for Russia sovereign debt is Ba1; and Fitch's credit rating for Russia is BBB-.

 

Neil MacFarquhar mentions how “sanctions have caused a recession in Russia, and that it is even affecting the spending habits of the wealthy. Where Barvikha Luxury Village – a neatly groomed shopping mall housing brands like Prada and Gucci as well as two car dealerships, Bentley and Ferrari/Maserati – is deserted most days. With the economy reeling from the oil-price crash and Western economic sanctions over Ukraine, the ruble has sunk precipitously, inflation is up sharply and real wages are shrinking for the first time in years, forcing Russians – even the wealthiest – to make do with less.”

 

India's sovereign credit profile was more vulnerable to drought than most of its Baa-rated peers because of the relatively high share of agriculture in GDP and employment, weak rural infrastructure, inefficient food distribution and the relative share of food subsidy cost in the fiscal deficit.

 

"Although India may avoid drought this year, its economy remains vulnerable to future drought or fluctuations in rainfall, and its sovereign credit profile is more exposed to the negative effect of drought than those of most Baa-rated sovereigns," Moody's said in a report.

 

It currently rates India at 'Baa3', the lowest investment grade -- just a notch above 'junk' status.

 

"Our positive outlook on India's rating reflects our view that the measures that central and state governments are taking to improve rural infrastructure, agricultural productivity and food distribution, will over time lower overall inflation levels and volatility, including volatility associated with drought. But in the near to medium term, policies to improve infrastructure, food distribution, and non-agricultural employment opportunities hold the key to reducing the annual economic uncertainty that is linked to the performance of monsoon," it stated.

 

Standard & Poor's credit rating for China stands at AA-; Moody's rating for China sovereign debt is Aa3; and Fitch's credit rating for China is A+.

 

In an article in Fortune magazine dated 2nd September 2105, they highlight how “analysts are increasingly worried about the situation in China in part because the global economy has grown increasingly interconnected. According to the Treasury Department, 30% of the jobs created in the U.S. since the Great Recession were export-dependent.

 

Meanwhile, the share of economic growth coming from emerging markets has increased markedly over the past 20 years. Back in the late 1990s, emerging markets accounted for 20% of global GDP; now it’s 40%. And during this decade, China has accounted for a third of global growth, compared to just 17% for the United States. Given this change, Ruchir Sharma, head of emerging markets and global macro at Morgan Stanley Investment Management, has argued that China is now the “critical link” needed to power a prosperous global economy. There’s no doubt that a slowdown in China will seriously crimp global growth, given the role the world’s second largest economy has played in recent years.

 

Of course, 2015 isn’t 1998. China is a much bigger force in the global economy today than countries like Thailand or South Korea, where the trouble in Asia started a generation ago. But while a slowdown in China might be more meaningful in terms of global growth, there’s plenty of reason to be skeptical that it will lead to slower growth in the United States. Exports only account for about 15% of U.S. GDP, while exports to the Pacific Rim account for just 2% of GDP. With figures like these, even a 10% decline in trade to the region would shave just 0.2% from growth in the U.S.

 

The prospects for the U.S. don’t look spectacular. We’re living in a world of ho-hum 2% growth. But there are no serious signs of a domestic recession on the horizon. Unemployment continues to trend downward, and commercial and residential investment look bright.

 

Investors in equity markets, on the other hand, may have reason to worry. By many measures, U.S. stock markets are pricey, and we’ve been due for a correction for months now. But the stock market follows the beat of a different drummer, with momentum mattering much more, at least in the short term, than economic fundamentals.

 

An article by Heather Stewart in the Guardian dated 29th September states that “rising global interest rates could prompt a new credit crunch in emerging markets, as businesses that have ridden the wave of cheap money to load up on debt are pushed into crisis, the International Monetary Fund has said.

 

The debts of non-financial firms in emerging market economies quadrupled, from $4tn (£2.6tn) in 2004 to well over $18tn in 2014, according to the IMF’s twice-yearly Global Financial Stability Report. This borrowing binge has taken business debt as a share of economic output from less than half, in 2004, to almost 75%.”

 

Probably the only country that has got it right is China – their growth rate was never going to continue at its past rate – any economic life-cycle will tell you that. The ‘party’ is probably over and China will now grow like other mature nations – but out of all the BRICS countries they have probably had the best response to their economic woes, regardless of what the press may have you believe.

 

What the world needs now is both stability and strong economic leadership – sadly, with politics becoming a celebrity, power brokered game, rather than a serious business – the future is precarious at best, and we can only hope that some great, inspirational leadership emerges soon from the complete mess that exists around the globe at the moment. We desperately need politicians who will look beyond their own ego’s and actually do what it says on the ‘tin’ – which is to work for the best sustainable long term strategy for all their citizens. This will give greater confidence to business and help the growth of genuine exceptional leadership in the workplace too.

 

References:

 

MacFarquhar, N. (2015). Russians Tighten Their Belts. Portfolio Magazine, Issue 116, p.84-87.

 

Matthews, C. (2015). Will The Crisis in China Sink the US Economy? Fortune Magazine. 2nd September. [on-line: http://fortune.com/2015/09/02/china-crisis-us-economy/]

 

Scott, M. (2015). Here's the $17 Trillion Reason Why the BRICS Summit This Week Is a Big Deal. Bloomberg News. 7th July [on-line: http://www.bloomberg.com/news/articles/2015-07-06/here-s-the-17-trillion-reason-why-the-brics-summit-this-week-is-a-big-deal]

 

Stewart, H. (2015). IMF Warns of New Financial Crisis if Interest Rates Rise. The Guardian. 29th September [on-line: http://www.theguardian.com/business/2015/sep/29/imf-warns-new-financial-crisis-interest-rates-rise]

 

The Economist (2015). Poorly managed state owned companies are dragging down the wider economy. August 29th. P.41-42.

 

 

Are We Creating Future Generations of Shepherd’s or Sheep?

There was a post on LinkedIn just the other day where someone had posted a picture with the caption “click like and type 6 and watch what happens” – and at the time I saw this so called discussion over 3,500 highly qualified people had ‘liked’ this discussion, typed ‘6’ and then written a comment along the lines of “hey, nothing happened” or “what’s meant to happen?”

 

Of course a handful of people, less than 1%, had commented that this was a con and they couldn’t believe how gullible people were as it’s clear nothing is going to happen because it’s a static picture lol. Apparently these kind of ‘posts’ are quite common according to some – and yet thousands of people ‘fall’ for them each time.

 

Then you have the ‘discussions’ (I use the term loosely) where you’re given a pretty simple mathematical puzzle to solve with the headline – ‘only a genius can solve this’ – which translates into ‘a four year old can solve this’; but yet again thousands of highly qualified people participate and answer the obvious question – I assume because they desperately want to be hailed as a ‘genius’.

 

What shocks me is that it appears these people are ‘shepherds’ in the business world, yet become ‘sheep’ in the world of social media where many people can get caught in ‘following the crowd’ just to be trendy or whatever. Where for a millisecond they lose complete confidence and have a desperate desire to be ‘seen’ as a genius along with the other few thousand people – I assume also believing in that millisecond that recruiters and potential clients will take their ‘genius’ (of a four year old) into account.

 

In a sense it’s an extension of ‘groupthink psychological theory’ where people fail to think rationally as they see one person has ‘done’ the task and assume – all evidence to the contrary – that maybe there’s something to see and their inquisitiveness takes over and they follow the crowd.

 

Some of the participants in the discussion had the courage to write later that they couldn’t believe how gullible they had been – but as we know in business, it only takes one error of judgement to significantly damage and organisation’s or individual’s future.

 

Of course, as one participant had mentioned in the comments, there’s a more sinister side to this, where it shows how easily people can be fooled into forgetting what they genuinely know to be true and instead can be so easily led to follow a set of instructions ‘believing that a miracle is truly going to happen.’ In these particular cases no damage was done – but that’s just in these examples.

 

In a world where ‘front line news’ has now become entertainment first and real facts second; politics is about short term tenure rather than long term prosperity; and where many businesses lack genuine accountability at the very top in that constant year-on-year search for profit maximisation – how do we ensure we develop future generations of shepherds, in a society that wants to encourage them to be sheep?

 

In an on-line article in CommunicationTheory.Org they remind us that “Groupthink is an occurrence where by a group comes to a unanimous decision about a possible action despite the existence of fact that points to another correct course of action. This term was first given by Irving Janis who was a social psychologist. His main aim was to understand how a group of individuals came up with excellent decisions one time and totally messed up ones at other times. According to Irving, in a group sometimes there comes a situation when all the members of the group think it is more important to come to a unanimous decision than to carefully go through all their options to get at the most beneficial course of action.”

 

Also the Merriam-Webster Online Dictionary (2010) defines Groupthink as “a pattern of thought characterized by self-deception, forced manufacture of consent, and conformity to group values and ethics.”

 

Groupthink as it currently stands is not accepted by everyone and James Rose highlights how “Janis (1972, 1982) defined the groupthink model to describe a potential downside that groups face where conformity pressure can lead to defective decision-making. Janis specified symptoms of groupthink and steps groups can take to prevent groupthink. Researchers have completed many case studies where groupthink appears to factor into poor decisions. It appears groupthink occurs across a wide spectrum of groups. Experimental results, however, are limited and at best give mixed results. A key question is whether groupthink is a myth (Fuller & Aldag, 1998) or whether improved experimental approaches will validate the model. Mohamed and Wiebe (1996) advocated, - the nature of the theory is still unclear. This ambiguity represents a major barrier to theory testing, (p.51).”

 

Yet there are more pressing matters for future generations than Groupthink. ‘We’ first need to encourage children to act and think as individuals and encourage them to realise that learning and true innovation, means challenging the status quo. How you challenge the status quo is for another article – and yes, has a huge impact on how your thoughts and ideas will be received in any setting, whether in business or your personal life.

 

But we need to ensure we create environments that encourage future generations not to become sheep and simply follow ‘groups’ because it appears to be the ‘cool’ thing to do and feeling this allows them to feel more accepted by society. This isn’t just within the education system – but the business sector needs to look beyond ‘conforming’ cultures that encourage a ‘groupthink’ mentality – to creating environments and cultures that encourages individualism so that organisations can genuinely maximise their long-term optimal potential.

 

References

 

Groupthink in Group Communication, Organisational Communication, Psychology, Behavioral and Social Science [Online: http://communicationtheory.org/groupthink/] 12.09.2015

 

Rose, J.D. (2011). Diverse Perspectives on the Groupthink Theory – A Literary Review. Emerging Leadership Journeys. Vol. 4 Issue. 1, p. 37-57.

 

Why Do We Make Leadership So Complicated?

If you’ve worked for different bosses or moved jobs in your career to date, then it’s likely you’ll have your own idea what defines a good (and bad) leader for you, as well as all the categories in between. Then if you talk to friends and colleagues about what defines a great leader for them you’re likely to get similar responses;

 

They motivate me;

They listen to me;

They set the example;

They inspire me;

They have empathy;

They are fair;

They communicate well (and often);

They are transparent and trustworthy;

 

They’ll be other key attributes as well – but the list is pretty consistent across all demographic groups.

 

So, if the list of attributes is easy to collate and not that difficult to interpret; why is there a problem in finding and developing effective leaders?

 

It seems that our own individual desire to commercialize all elements of business is also our worst enemy for simplifying business and making positive progress in many areas, including leadership development. If you Google ‘Leadership Development’ you’ll get 107 million results – yep that’s 107,000,000. If you Google ‘Leadership Courses’ you’ll get 325,000,000 results and if you Google ‘What is Leadership’ you’ll be presented with 477,000,000 results.

 

You’d like to think that the 477 million results answering the basic question ‘What is Leadership’ would simply be ‘one answer/definition’ repeated 477 million times – but it’s not. So if we can’t decide what leadership actually is anymore, how can we hope to develop consistent, effective leadership? And what message are we giving to the up and coming generations who are our future leaders, who aren’t even in their career cycle yet – but are influenced by what they see and hear as they look for inspiration and direction.

 

If you look at the contents of many leadership programs offered by some of the top academic institutions around the world, you’ll find them offering modules that no longer focus on the core elements of leadership – motivating and inspiring people – but are more around peripheral business issues like negotiation skills; or aligning strategy and sales (a module in the leadership best practices course at Harvard).

 

It’s not that these peripheral modules don’t have a place in a leadership program for people in sales for example – it’s that these programs no longer look at the ‘people’ element and how to inspire and motivate them; or good communication skills; or empathy; or any of the key attributes people mention when talking about a great leader.

 

So if were not teaching or talking about the people side of leadership anymore, is it any wonder that there is this widening and confusing lack of a single definition as to what leadership actually is – and worse still, any wonder that leaders do not know how to inspire and motivate their people?

 

In fact it appears that all the things that leadership isn’t about – power, position, and hypocrisy – are being practiced more and more – and worse still, this is being accepted as effective leadership as long as the results are there.

 

This negative impact on effective leadership is heightened by the fact that ‘we’ seem to forget both history and the basics so quickly. History has shown that power will get results, but it also shows that power won’t get the best sustainable results for your organization.

 

Two of the major blocks as to why leadership won’t change for the better in many organizations any time soon are because;

 

Bad leaders will always develop and promote further bad leadership, regardless of results and their exposure to ‘effective leadership’ development programs – because they are addicted to the power that comes with the role;

 

And in the large multi-national organizations, bad leadership exists in the ranks because these people know how to play the corporate game and create a protective structure around themselves, very similar to a ‘mafia’ set-up – where anyone who poses a threat to their power base, is dealt with swiftly and mercilessly.

 

The failure to develop great leaders rests firmly with corporate boards and major stakeholders. Boards that genuinely want to improve their leadership, first of all need to identify where the poor and bad leadership exists; and that isn’t going to be achieved by asking the leaders themselves; it’s only going to be achieved through managing by walking around. It will require patience as they build trust with their employees at all levels in the organization – and once the trust is built, they will quickly learn where their leadership problems are. Then as they quickly find the source of poor leadership, their response should be swift and firm, giving a clear message to the organization what kind of leadership is acceptable.

 

They then need to go back to basics and have a leadership development program from cradle to grave – that ensures a constant pool of excellent leaders at all levels within the organization.

 

The danger with the dilution and uncertainty around what effective leadership is really all about, is that ‘people’ lose sight of what the ‘rule’ should be and start to accept poor leadership as the ‘norm’ – once this becomes embedded in organizational cultures then the likelihood of genuine effective leadership on the job becomes nothing more than a ‘dream’ – and the disillusionment becomes the new reality.

 

It requires all of us that care about effective leadership to stop ‘fighting’ amongst ourselves with respect to things like what ‘effective leadership’ should be called or how it is defined – and just become ‘visible’ examples of what great leadership is all about.

 

The world is changing fast and we need to be careful that we don’t sit by as genuine effective leadership is diluted before our eyes effecting and impacting generations to come. Political leadership no longer sets an example of effective leadership and has become nothing more than media controlled entertainment; academic leadership has become so profit focused that it’s now business first and being an effective learning establishment second; and business leadership is sliding down the slope to create a new norm for accepting, what should be unacceptable poor leadership behavior that will take generations to reverse, if we don’t act soon.

 

Effective leadership is not difficult – it’s about inspiring and motivating people to achieve specific goals and in the process optimize their own potential. It requires the recruitment of the right people at the outset, the development of the right culture and then consistently being a role model of an effective leader, accepting that different situations require different leadership styles to optimize the inspiration and motivation of the employee.

 

 

Are You Good At Giving and Seeking Advice?

In an excellent HBR article entitled ‘the art of giving and receiving advice’ David Garvin and Joshua Margolis highlight how “seeking and giving advice are central to effective leadership and decision making. Yet managers seldom view them as practical skills they can learn and improve. Receiving guidance is often seen as a passive consumption of wisdom. And advising is typically treated as a matter of ‘good judgement’ – where you either have it or you don’t, rather than a competency to be mastered.”

 

There are many influencing factors that influence our basic desire to seek advice, just as much as they influence how we give advice;

 

Our upbringing – i.e. were we encouraged to seek advice when we were growing up, or did we ‘learn’ that asking for advice was often seen as a weakness and hence we’ve taught ourselves that it’s better just to ‘keep quite’ and appear smart. This influencing factor has a huge impact not just on how individuals avoid seeking advice, but also significantly impacts how these individuals give advice and their perception of those that ‘seek ‘ advice from them.

 

Organisational culture influences employees ‘desire’ to both seek and give advice. Some organisations encourage an open and transparent environment where employees are encouraged to seek advice from as many quarters as possible and this is seen as a strength. Also in these cultures ‘leaders’ are keen and available to give advice but not from a position of power and/or telling, but based on the situation – where for example they might counsel; or coach; or mentor depending on the situation and the type of advice being sort.

 

Age will influence an employee’s desire both to give and seek advice. It wasn’t that long ago – before the advent of social media and the like, that age equated to wisdom. In fact it wasn’t that long ago that age equated to seniority and hence perceived experience – and this is still true in some cultures today. But organisations have learnt that age and historical experience don’t on their own equate to genuine wisdom as business is constantly evolving and changing over short time intervals. So the wisdom resides with those that have learnt to adapt to different business scenarios and who are up-to-date with current business skills.

 

But because of the above, there will be some who have been in business for a long time who genuinely believe that they know best; and what they don’t know isn’t worth knowing. And then at the other end of the spectrum there will be those who have been in business for a long time who are nervous about seeking advice as they fear that it will be perceived as a weakness rather than a strength – but this links more to culture than age.

 

As Garvin and Margolis mention “advice seekers and givers must clear significant hurdles, such as deeply ingrained tendency to prefer their own opinions irrespective of their merit, and the fact that careful listening is hard, time-consuming work. The whole interaction is a subtle and intricate art. On both sides it requires emotional intelligence, self-awareness, restraint, diplomacy, and patience. The process can derail in many ways, and getting it wrong can have damaging consequences – misunderstanding and frustration, decision gridlock, subpar solutions, frayed relationships, and thwarted personal development – with substantial cost to individuals and their organisation.”

 

Even then, it is not a ‘black and white’ scenario – some employees may be good at asking for or giving advice in certain situations and not in others; good at giving or receiving advice on certain topics and not on others; etc. Just the daily pressure of work can significantly influence the quality of advice given or received.

 

Garvin and Margolis remind us that “whether you’re receiving or giving advice, flawed logic and limited information complicate the process. Advice seekers must identify their blind spots, recognize when and how to ask for guidance, draw useful insights from the right people, and overcome and inevitable defensiveness about their own views. Advisors, too, face a myriad of challenges as they try to interpret messy situations and provide guidance on seemingly intractable problems.”

 

When you’re seeking advice, watch out for these common obstacles;

 

1) Thinking you already have the answers;

2) Choosing the wrong advisers;

3) Defining the problem poorly;

4) Discounting advice;

5) Misjudging the quality of advice;

 

And when you’re giving advice, watch out for these common tendencies that can cause problems;

 

1) Overstepping boundaries;

2) Misdiagnosing the problem;

3) Offering self-centered guidance;

4) Communicating advice poorly;

5) Mishandling the aftermath;

 

Garvin and Margolis mention that “though seekers and advisors work together to solve problems, they have different vantage points. Recent social psychology research shows that people in an advisory role focus on overarching purpose (why an action should be performed), whereas recipients of advice – who usually face an impending decision – are more concerned with tactics (how to get things done). An individual is likely to think idealistically as an advisor but pragmatically as a seeker, even when confronting the same challenge.”

 

You’ll often find that those who are best at giving advice are those that regularly seek advice themselves, regardless of their level in the organisation – and that’s what makes them extra special advice givers. They appreciate that asking and giving advice is an art – and they are keen to perfect it.

 

Garvin and Margolis conclude that “overall our guidelines for both seekers and advisers amount to a fundamental shift in approach. Although people typically focus on the content of advice, those who are most skilled attend just as much to how they advise as to what they advise. It’s a mistake to think of advice as a one-and-done transaction. Skilled advising is more than the dispensing and accepting of wisdom; it’s a creative, collaborative process – a matter of striving, on both sides, to better understand problems and craft promising paths forward. And that often requires an ongoing conversation.”   

 

The danger is that future generations aren’t being encouraged to ask for advice face-to-face; but are being taught at an early age that they can get advice remotely – without being able to check whether the ‘adviser’ is qualified or whether advice is accurate or not, often until it is much too late. The art of seeking and giving advice needs to be an integral part of the educational curriculum so that ‘we’ can teach future generations the importance of seeking and giving the right advice.

 

References:

 

Garvin, D.A. and Margolis, J.D. (2015). The Art of Giving and Receiving Advice. Harvard Business Review. Jan/Feb, p.61-71.