Leadership in the Innovation Economy
Lately, I’ve seen descriptions of various types of leadership. There is Servant leadership, Legacy leadership, Failure-Tolerant leadership and others. This can be confusing to anybody trying to adopt a leadership style. So I thought I would look at the prevailing thought and research in this area. I found that the findings can be condensed into easy to understand descriptions. First we must define what we mean when we use the term “Leadership”and how it is different from “Management”.
We see the use of the term “Management”, in thousands of articles and books. It actually means many different things according to whoever is using it. I prefer scientific or researched based findings for a definition of Management. Frederick W. Taylor, in his works on Scientific Management offers the most respected definition of Management. He describes it as a science or set of skills.
“ Scientific Management [set of skills ] is a theory of management that analyzes and synthesizes workflows. Its main objective is improving economic efficiency, especially labor productivity.” Wikipedia
Considering Taylor’s conclusions, we can describe Management as the responsibility for designing and executing a strategy with clear objectives, targets and deadlines. You also have the responsibility to design methods (Systems), set standards, guide the performance of workers, and measure results. In addition, Management includes hiring, training and promoting workers. You will train and coach the appropriate employees required to successfully meet the objectives as described in your Strategy. In other words, Management is the organization and coordination of the activities of a business in order to achieve defined objectives. You will also apply change management skills as you find the need to make various types of changes to your established Strategy and Systems. People skills, such as communication and conflict management skills fall under the umbrella of scientific or skill based Management. Management skills have been the focus of years of management research. Today, we have time-tested and universal Management skills available to managers because of this rigorous research. Of course, there will always be improvements in the discipline but basic Business Management skills will stay relatively the same.
Business Management requires a specific set of skills. Often, new business owners don’t realize the need for these skills and run into many problems. The best managers will continuously learn and improve their Management skills.
See Management Skill Guides in “20 Directives for Small Business Directives: Do or Die”
“ Management is, above all, a practice where art, science and craft meet.” Henry Mintzberg
Henry Mintzberg conducted highly respected research describing Management as an art.He concluded that managers are required to use their personal, social and political skills to guide workers and business processes. Art is also required to conduct problem analysis and Strategy building.
However, some Management skills are indeed universal and timeless. So we will move forward with the belief that Management is a set of skills artfully applied by the manager.
The term Leadership is often confused with Management. You will regularly see them used interchangeably. They are different however and we will explore that difference now. First, know that you will need to use Management and Leadership to build and sustain a successful organization.
Kevin Kruse in Forbes magazine shared this definition of Leadership: “Leadership is a process of social influence, which maximizes the effort of others, toward the achievement of a goal.”
So, we can agree that leadership is a matter of influence. Leaders influence the people in the organization to adopt the Mission/Purpose, Values, Vision and objectives. Primarily, the leader demonstrates and guides others toward the behaviors required to meet the business objective. He or she models the appropriate behaviors, then shape and reinforce those behaviors in others.
On the subject of leadership, Sim Tshabalala, Co-CEO of Standard Bank, one of Africa’s largest, believes: “It’s about knowing your industry but having the ability to lead people who know more than you.” Pointing to the need for leaders to be genuine, honest, directional and self-assured.
As you study leadership, you will find various lists of characteristics of a good leader. Among them will be positivity, empowerment, open-mindedness and others. However, the essence of leadership is influence.
Below, I will briefly describe 3 leadership types for your consideration:
Servant leadership has been defined as a philosophy and set of practices that enriches the lives of individuals, build better organizations and ultimately creates a more just and caring world. (Robert K. Greenleaf )
A Servant-Leader isn’t concerned with authority and power. His or her basic concern is contribution to people and communities through the Mission or Purpose of the organization. The Founders’ business architecture must be fully established. This will help maintain control and direction for the enterprise. Therefore, the Servant-Leader puts the needs of others first and helps people fully develop their skills for the highest performance possible.
According to Greenleaf, the best test that Servant-Leadership is being effectively applied is to answer the following questions:
Do the people being served grow as persons?
Do they, while being served, become healthier, wiser, freer, more autonomous, more likely themselves to become servants?
What is the effect on the least privileged in your society?
Ken Blanchard, a strong promoter of Servant-Leadership, believes…
“Once people are clear on where they are going, an effective leader’s role switches to the task of implementation. The biggest thing leaders must do is get their egos out of the way. High self esteem is required for servant leaders.”
Legacy Leadership “…is a by product of the historical decisions one makes driven by his or her personal values. In other words, a solid legacy plants the seeds from which consistency and expectations sprout that, in turn, become the organizational funnel for future performance. Jack Welch, former CEO of GE, bestowed upon his employees one question to always keep in mind when making decisions: Will what I’m doing right now result in a win for the company? As a result, he took GE from $13 billion in 1981 to $480 billion in 2000 — an achievement still talked about.”( Peter Barron Stark)
So, how do we do this?
Embed your Values into your being. Your values guide and influence all areas of your life. Intentionally develop clear values to guide all of you business decisions. This is the foundation fo your Legacy Leadership. This is what you will be known for.
Design a clear Vision and share it with affiliates. People will easily follow you if you know where you’re going. Obvious- right? Clearly define your vision in writing and ensure everybody knows exactly what it is you’re looking for. You could use various forms of communication such as, posters, emails, or written documents to each individual affected. They must see your Vision as you see it in order to achieve relevant goals.
Communicate repetitively. Clear and consistent communications shared over and over in a variety of ways convinces others that you can be trusted. You are determined and you know what you want to do. Stark suggests that you tell relevant stories about your successes and goals. Stories strongly impact our memories.
Build relationships everywhere. “If you intend to be remembered as a great leader, start now. Smile more often. Make friends when you don’t need them. Do things for others that they can’t do for themselves, and take action without the expectation of reciprocation. Legacy leaders recognize that leadership is about relationships, and actively look for opportunities to build genuine relationships with people, regardless of where they are on the corporate ladder.” (Stark) This action relates to Servant leader behaviors. Commit to continuous learning. Admit mistakes and continue to learn. This is excellent role-modeling for future leaders. It is also Legacy Leadership at it’s best!
Stark suggested that you Walk your Talk:
Failure -Tolerant Leadership…is a leadership style that coordinates an organizational culture in which follower-subordinates are free to try, to fail and try again. Leaders who adopt the Failure-Tolerant approach realize that innovation is the key to capturing and or retaining a sustainable competitive advantage.” (ecoggins)
“In recent years, more and more executives have embraced this point of view, coming to understand what innovators have always known: that failure is a prerequisite to invention. A business can’t develop a breakthrough product or process if it’s not willing to encourage risk taking and learn from subsequent mistakes.” (ecoggins) This leadership style is beneficial for the Innovation Economy where progress and wealth are driven by creativity and innovation.
Farson and Keyes argued that Failure-Tolerant leaders can be characterized as those who..
- Alleviate fear of failure through supportive words and actions
- Do not merely accept failure, but encourage it
- Identify and dismantle barriers that separate them from their followers
- Interact with their subordinates at a personal level
- Openly share their own mistakes and failures
- Root out destructive competitveness that stifles collaboration
- Push their people to look passed common ideas about failure
- Inspire creativity and innovation
This leadership style is critical in the Innovation Economy. Consider the required behaviors well!
We can conclude that leaders of the Innovation Economy must exhibit characteristics of at least, three types of leaders. They all seem important to the success of your enterprise. Is this impossible? No. A business founder already has these ideas in his or her head. It’s just a matter of sorting them out and determining a plan of action. Having as much information as possible about the types of leadership you have to choose from will be an excellent foundation for success.
A final and summative type of leadership is the “Super Leader” as described by Koch and Godden. Super leaders lead from four distinct behaviors:
Force of personality or character — integrity, trust, listening, and respect for followers. This conforms to the Servant leader and the Failure Tolerant leader behaviors.
Industry insight and innovation — Clear specialization in your industry is the requirement. Focused study and involvement in your industry make you an expert and give you the tools for creativity and innovation. This conforms to the Failure Tolerant leader and the Legacy leader behaviors.
Computer-based control: corporate autopilot — Automated performance controls allow the leader to know where he/she is (base line measurement), where he/she is going, and how and when he/she will get there. A simple click at the computer can offer more control than a large group of management personnel. This conforms to the needs of each leadership style because factual information, easily at hand, facilitates all business functions.
Propaganda and control by culture — Super leaders rely on their own inner certainty and force of personality to promote the corporate Values and Culture. This is facilitated by strict instructions and strong leader control. Those who don’t fit the stated organization values are eliminated. This conforms mostly to the Legacy leader profile and the structural control necessary for each Leadership style.
One last acknowledgement is Mike Myatts’ description of leadership.
Leadership is pursuit — “pursuit of excellence, of elegance, of truth, of what’s next, of what if, of change, of value, of results, of relationships, of service, of knowledge, and of something bigger than yourself. Having a mindset focused on pursuit is so critical to leadership that lacking this one quality can sentence you to mediocrity or even obsolescence.”
As you consider the latest thinking on leadership, you will design your own leadership style. Combining excellent Leadership and Management, your enterprise will become a leader in this fantastic Innovation Economy we find ourselves in. All of the skills highlighted above and more will be required in this volatile and unpredictable environment as we move forward. The more you know, the more successful you’ll be.
