Complex Leadership: The balancing act
The other day I read a post on Linkedin that talked about the fact that managers aren’t living up to their employees expectations and that leadership in general was in pretty bad shape in many organizations. None of this was new and I have tackled several of the topics in the Linkedin post in my new book “The Human Way: The Ten Commandments for (Im)perfect Leaders“. What caught my attention was one of the comments to the post: “if everyone agrees on the problem, why can’t we do something about it?”. This may be one of the most important questions in leadership. From a leadership point of view, the only thing that is worse than the fact that so many organizations suffer from the burden of bad leadership, is the fact that it doesn’t have to be that way. We know more about good leadership today that at any time in human history and we know that there is a great deal that can be done to radically improve the leadership in our organizations. So the question is, why don’t we do it? We know, for example, that training of managers and employees, coaching, practice and better management selection processes can all contribute to improving the quality of the leaders in our organizations. This in turn, will create happy employees, more satisfied customers and in the end wealthier shareholders.
Success in the organization is a question of balance
I am convinced that a large part of the problem is that we tend to focus only on one thing at a time or we don’t focus on anything at all. One of my most common recommendations to the management teams I work with is that they need to prioritize and focus. Many businesses drive so many major initiatives at the same time that they never actually succeed with any of them. On the other hand, another common problem is that we focus on only one aspect of our business or our organization so hard that other parts suffer. For example, we might focus so much on customer satisfaction that we forget about our employees or vice versa. Success in organizations is all about balance. Successful organizations are characterized by people who cooperate of their own free will to achieve common goals or a common purpose. In other words, various stakeholders choose to cooperate and success is the result of balancing the interests of the various stakeholders. I had a Dutch boss once who used to say that “success in business is like the guy in the circus who has to keep all the plates spinning on the sticks at the same time. He has to keep his eye on all of the plates. If he focuses too much on one plate the others will fall off their sticks and break.
When I was appointed as head of Telia Mobile (the largest cell phone operator in Sweden) I was interviewed by a journalist from one of Sweden’s major business newspapers. Early on in the interview I realized that the journalist had already decided on his angle for the article and it wasn’t going to be very flattering for me. His thesis was roughly that I was incompetent for the position. After a short discussion he came right out and asked “You trained for the ministry, and then you sold washing machines and refrigerators. Now you are going to be head of Telia Mobile. What do you know about the telecom industry? ” I answered his question by asking him a question. ”As I understand it, you have been covering the telecom industry for many years and know a great deal about telecom and about Telia.” He nodded and I continued “Is there any technical competence that Telia lacks or any technical challenge that Telia needs to solve that they lack the competence to solve?” He said that he had was impressed by Telia technical competence and doubted there was any significant weaknesses in the company’s technical skills. I said, “If Telia had hired a telecom engineer to be the boss for Telia Mobile, would it have contributed any new competence that was needed in the company?” He then asked me if there was anything from my ministry training that would be of use in my role as the head of the cell phone business? Suddenly, I got an idea. I said that when I was a Christian we had a concept called ”The Holy Trinity” which was the Father, Son and Holy Spirit. Now I have a new holy trinity with the Customer, the Employee and the Shareholder. Just like the Christian “Holy Trinity” I may not always understand exactly how everything fits together but I believe firmly that you cannot create value for one of these parties without creating value for all of them. I don’t believe that disillusioned, unmotivated employees can create happy customers who make the shareholders wealthy.
It’s better to succeed one thing at a time than to fail at many things all at the same time
Success in any organization is all about creating value for or satisfying needs with all stakeholders and my little ”holy trinity” is too simple to describe the complex reality for most organizations. Many organizations have more than three important groups of stakeholders. Businesses have many different types of cooperation with suppliers, various types of customers; like end-users or consumers, wholesalers, distributors, retailers, etc. Some organizations can have a high level of complexity in their ownership as well. In government organizations citizens of the society may be both perceived as owners and customers at the same time. The more complicated the stakeholder matrix is for an organization; the more difficult it can be to satisfy all the interests of the various stakeholders. If we focus too much on one stakeholder group we risk losing another.
A good marriage is where both parties feel they get more out of the relationship than they put into it
Leadership is a question of relationships between people. Leaders must understand the different needs and align interests so that everyone gets something meaningful from the relationship. I had a sociology professor once who said that ”a good marriage is where both parties feel they get more out of the relationship than they put into it.” I think this is valid for all types of relationships including the relationships between all the stakeholders in the workplace. If our customers perceive that they get more from our business than it costs them they will continue being customers. Employees who get more value from their work than it costs them will continue as employees. But making sure that all stakeholders get more out of the relationship than it costs them can be very complicated and should not be taken lightly. This is a key challenge for leaders.
Five tips for managing the complexity in your leadership role.
- Embrace the complexity! If you have an oversimplified view of the challenges you will end up with over simplified solutions. As Einstein supposedly said ”everything should be as simple as it can be, but not simpler”.
- Map out the complexity. Do a stakeholder analysis. Describe the different stakeholders who are important for your business. What role do they play and what value do they get from your organization.
- Try to understand interdependencies between the stakeholders that may not be directly connected to your business. For example if you work in a government authority you should understand the relationship between politicians, citizens and society as a whole, not just your direct relationship with the politicians or citizens.
- Think holistically. Create action plans that consider the needs of all your stakeholders. Think about whether changes and improvements in your business are better for all stake holders or only for some.
- Focus on a few major initiatives at the same time. When you have understood the complexity of your organization you will realize that it is a big enough challenge succeeding with one thing at a time. When you have succeeded with one initiative you can start another. You will discover that it is better to succeed with one thing at a time than to fail at many all at the same time.