There is no more important component to your organization than its leadership. The senior leaders—such as the board, CEO, president, and executive management—form the foundation of everything that happens in an organization. While in the past few years more attention has been paid to the role of middle management and employees, the issue of senior leadership is core to the development of an ethical and effective organization. Without it, over the long term, everything else falls apart. The BP disaster in the Gulf of Mexico and Toyota’s recent quality issues both highlight what can happen when senior leadership is disconnected from an organization’s operations.
It is important not to confuse the concept of leadership with management. “Management” is about tasks and processes. Good management increases the efficiency of an organization and allows the employees of an organization—senior leaders and others—to do what needs to be done. Management does not necessarily have to provide leadership to achieve its ends. A successful organization will have a number of very good managers, but they are not all necessarily good leaders.
We should also acknowledge that different circumstances require leaders of different skills. That does not change the limitations put on the organization by its leadership: no individual can drive an organization to be better than he or she can be individually. A leader’s potential is the potential of the organization, and the leaders’ limitations will be the limitations of the organization. For example, you may need a top executive with a special skill set in raising capital, building process controls, or developing new markets because that is an area that requires critical attention in the short term. You should be cognizant of the fact that having such a leader solves a management or operational problem, but may create a leadership gap. Those skills may be what are necessary, but it does not make that person the right long-term leader for the organization. Of course, this is not to say that great managers cannot be great leaders or vice versa, it is more of a reminder that the two do not necessarily go hand in hand.
So what is it that makes a great leader? It is the understanding that leadership is about connecting with people. Leadership is about developing and realizing the potential of the employees of your organization. It is about the human element and motivating employees to drive efficiency and commitment to objectives. The human side is much more fragile than any process. A leader understands that without a trusting environment and leadership that listens and addresses its employees’ needs, an organization’s people become a wasting asset.
Authenticity
The manner in which leaders connect is also extremely important. When we think about qualities in leaders, we usually focus on virtues such as honesty, integrity, and a strong work ethic. We look for a leader with character. General Norman Schwarzkopf famously said, “Leadership is a combination of strategy and character. If you must be without one, be without the strategy.”
Further, a true leader must not only lead in good times, but also during times of stress on the company and its personnel. It is during hard times that the true mettle of your leaders emerges. But while it is difficult to ascertain how a leader will react in the face of large challenges or opportunities, we can identify behaviors that are general indicators that your leaders engender the trust that is needed to gain commitment regardless of circumstances. The critical quality that high trust leaders possess is authenticity. So what are the behaviors or attributes that demonstrate authenticity?
First, authentic leaders are people who are self-aware. As distinct from the problem of egotism, authentic leaders show an understanding of, and comfort in, their strengths and limitations. There is balance between self-confidence and humility that gives you and others confidence that the leader understands the importance of each employee’s contribution. An authentic leader understands his or her importance to the team, but knows that without the team, goals will not be accomplished. A leader who is self-aware trusts himself or herself to make the right decision and, by example, instills in others trust in his or her leadership.
Authentic leaders are effective at communicating and connecting with people. Both are equally important.
Effective communication is critical as a leader. Further, the communication must be clear, concise, and consistent. Goals and objectives needs to be defined and values promoted. If you were to ask your organization, “What will we be doing in five years?” the answers should be the same from top to bottom. Unless the organization is clear on its mission, vision, values and goals, it cannot live up to them or achieve them.
But successfully communicating ideas, goals, and the mission of the company is only one half of the challenge. A leader must connect with stakeholders and the stakeholders must connect with the leader. The best leaders can have a cordial meeting with the Board or a fellow CEO in the morning and be out on the shop floor in the afternoon talking to a machinist. An authentic leader is both respected and admired, but also someone who respects and admires others and can show that respect and admiration naturally. This person is easy to like, but he or she also finds it easy to like others. Trust between people is formed from mutual appreciation and understanding.
Finally, an authentic leader understands his or her impact in the community and the market. An authentic leader is deeply concerned about personal, professional, and corporate reputation and character. They understand that actions impact those we know and those we do not. By positively impacting those people beyond the stakeholders of the organization, a leader prepares the battle space for the future. By building goodwill with the world beyond what we see and interact with daily, a leader creates a reserve of trust that is there to draw upon when needed. And it will inevitably be needed.
Self-awareness, effective communication, connection, and a higher sense of purpose are the building blocks of authentic leadership and these attributes are the manifestation of the evolution of the ethical development of an individual. The common factor in these attributes is the element of trust. Self-awareness is trust in one’s self. Communication and connection builds personal trust between individuals and an appreciation for the organization’s impact on the broader community builds trust with stakeholders—both present and future. Looking at the role of leadership at the highest abstraction, the most important job of leadership is building and maintaining trust.
It may not be politically correct to say so, but not everyone has the intellectual and emotional profile to run an organization. To do so effectively requires authenticity. The absence of self-awareness, effective communication, connection, or a higher sense of purpose fundamentally diminishes a leader’s chance of success especially in trying times when there are so many internal and external forces that adversely impact organizations. It is imperative that your leadership has the character to overcome these forces. By selecting and cultivating authentic leaders, you can build an open, high trust environment that delivers dividends in both the short and long term.
