Leadership Blog

A Conductor's View of Leadership

Itay Talgam’s take on leadership is inspiring.  Two million views of his Ted talk pay testament to that.  Here are some of his observations, based on his world of orchestral conductors.

The Israeli conductor says that simply commanding people is not enough.  Leaders need to emancipate people and encourage cooperation.  He refers to Italian conductor Riccardo Muti as an example of great talent and poor leadership.  Muti is known to be very stern and it’s his way or no way.  He allows no room for interpretation of music outside his own.  Talgam finds him a likeable man, but says that when he mounts the podium, he adopts a dictatorial style that causes stress for those around him.

He tells a great joke about Muti that could easily apply to many business leaders.  A violinist comes out of a concert hall and his friend asks him, “How was the concert with Muti?”  And the violinist replies: “Well, it was good – it could have been better but he wouldn't let us.”

For many leaders, results are paramount, as if enough in themselves.  The question is, at what cost?  Muti’s leadership style was no joke.  At one point, 700 La Scala employees are said to have signed a letter urging his resignation.  It suggests that even though the results were often great, what was happening on the way was very harmful and unsustainable.  Losing your followers is one sure way to destroy leadership and future success with it.

His own favourite conductor, as a role model for leadership, is the late Carlos Kleiber.  Although considered authoritative, Kleiber found a way to build a culture in which everyone had ownership of a certain type of interpretation – not through control of people, but of process, leaving individuals some space to find out how they could best fit into the process and get desired results.

Talgam says, “The idea that somebody has to know all the answers and preferably this somebody is in charge of everyone else, is, I think, totally wrong.”

Sometimes no one knows the answer and the leader’s job is to set the right conditions to allow others to discover possibilities and new solutions. “One great mistake is not allowing for mistakes: another is assuming that you can be the source of knowledge or solutions for your people.” 

Foe him, it is not about making sure the voice of the leader is always heard.   Talgam says that he recommends ‘keynote listening’ instead of ‘keynote speaking’. If you make people want to speak to you and in ways they would never have otherwise, you will discover new things. 

 

 

A Special Kind of Leadership

In a recent article by Heidrick & Struggles, the global search firm, they speak of the ‘new normal’ meaning a business environment characterised by more porous organisations that are being influenced by more voices and interests, expressed by increasing numbers of stakeholders. 

Their research suggests that this new normal is ‘a shift from shareholder dominance to stakeholder power’, a sense that businesses must be ‘in society’, not operating at arm’s length from it.  Think of the increasing power of activist shareholders, of active citizens who oppose fracking and such like.  

Leaders now need to take a whole new set of dynamics into account as they seek to satisfy customers and make a success of their organisation.  This requires Chairmen and Non-Executive Directors to adopt a fresh approach to board leadership.  It requires a special kind of leadership.

Divergent Thinking

The research referred to above shines a light on the need for “diversity of thinking” – the requirement that boards and their leaders should reflect the diverse perspectives of the organisations they lead, the customers they serve and the society within which they operate. 

To truly reflect society, to deal with uncertainty and complexity, and to drive sustainable business value creation, boards and their leaders must adopt new and different perspectives.  What is needed is an environment that fosters diverse thinking and actively encourages authentic dialogue.

The reality is that organisations, and the boards that govern them, face a new and more complex set of business challenges.  Stakeholders are often vocal and increasingly interconnected, and demand a say not only in what products and services are sold but also in the way they are designed, sourced, manufactured and distributed.   

As Heidrick & Struggles point out, this shift from ‘shareholder dominance to stakeholder power’ has been aided and abetted by the power of social media to demand and ensure transparency and disclosure from the organisation.  Every decision can now be analysed, critiqued and challenged from multiple angles in real time by groups of digitally empowered stakeholders, including employees.  

Of course gender and ethnic diversity are necessary, but it is agrued that this is nowhere near enough to help boards shape their response to an increasingly complex environment whilst also driving performance.   Boards must consider introducing a deeper diversity of thinking to see alternative perspectives and deal with the new reality.  A diverse board will have the right balance between thinking skills, technical knowledge and experience.  This level of diversity is consistently identified as a critical driver of board effectiveness, especially in turbulent times.

Thinking Styles

Divergent thinking styles in a board helps it to explore and evaluate many possible avenues and a range of possible solutions.  Listed below are four associated thinking preferences identified by the research:

  • Analytical thinking – this convergent approach is by far the dominant style of thinking in the boardroom, in part because board processes favour linear, logical approaches and also because much of formal education focuses on equipping us with analytical skills. A bedrock capability, analytical thinking helps boards unravel simple / complicated governance, regulatory and business management issues.
  • Innovative thinking – a divergent style where thinking is not limited to the realms of logic and practicality.  Einstein provides a rationale for this kind of thinking -“we can’t solve problems by using the same kind of thinking we used when we created them”.
  • Imaginative thinking – a style characterised by looking at the bigger picture and the longer term – addressing the issue of what ‘might be’.  In essence this style is about imagining the future, rather than addressing past problems. 
  • Relational thinking – an empathetic style that is sensitive to the impact decisions may have on others and on group dynamics. Relational thinkers think about networks of relationship, how they are held together in a web, the collective power and influence they hold and how that power and influence can be leveraged.

We know that many current board members, through their formative years and careers, have generally developed, favoured or adopted an analytical thinking style simply because that is the dominant approach in education and business.  The demand to conform to group norms, even for independent minded board members, is strong. 

Yet we know also that many board members can adopt and may even have a strong, natural tendency, somewhat suppressed, that is at odds with the clinical rationality of the analytical approach.  For example, relational thinkers are much more likely to use emotion and intuition to help them navigate business issues, especially those concerning people.  They will also be concerned with the impact of decisions on critical stakeholder groups and will use their ability to put themselves in the ‘shoes of others’ when assessing the implications of a decision.  This style is critical when trying to predict the reaction of employees or customers to change.

Suggestions for Boardroom Leaders

So what can leaders do to encourage and unlock diverse thinking in the boardroom?   Here are some suggestions for boardroom leaders:

  • Assess the current level of thinking diversity in the board and map against strategic business goals. Is there a gap?   Diversity must be rooted in the attainment of business goals.  To be sure, the needs of the business must drive diversity, not the other way around. 
  • Create a board culture that actively seeks alternative perspectives.  The leader will play a critical role in this by setting the tone, modeling types of behaviours, seeking alternative views and encouraging challenge and open dialogue.
  • When appointing directors, especially NEDs, don't just consider technical expertise and skills sets.  Look beyond analytical thinking.
  • Consider ways that new appointees can complement or contrast with other board members, perhaps seeking diverse professional or social backgrounds.  Someone with a not-for-profit background may bring a high degree of relational thinking to the table.
  • Look beyond the diversity of the board. Given what we know about stakeholder power, seek out and listen to a range of diverse stakeholder views before making critical board decisions.

 

   

Boardroom Leaders Need to Look Outside

Boards might be focused on the risks that arise from within their own organisation, but outside suppliers can cause harm too.

When an organisation’s suppliers get it right, they provide and add good value to go with the product or service.  When they get it wrong, however, they can become a source of financial and reputational damage — or even a back door for cyber criminals.

It is risk to which few boards seem to be alert.  Executive directors are usually focused internally on ensuring they hit their own targets and, while some non- executive directors are trying to look at the whole picture, it is difficult for them to really see into the supply chain.  And with companies becoming more reliant on third parties to deliver products and services, acquiring that overview is a strategic imperative.  It requires boardroom leadership in the form of challenge.

Suppliers should be a board issue, not just for executives but for non-executive directors, too.  If you are not clear on the management of your supply chain, you could get caught out by reputational issues such as suppliers breaching labour regulations.  Or you could have exposure in terms of currency fluctuations and movements in commodities.

Then there is the question of cyber security.  Big companies put a lot of time and effort into protecting their computer systems and the information they hold, but they could still be vulnerable if their suppliers don’t do the same.   There have been major breaches as a result of weaknesses in the supply chain.  Suppliers are drawn from many sectors, including small and medium businesses that in many cases do not have professionals dedicated to cyber security.

In some cases those weaknesses might allow criminals to gain access to data held by a third party, but in other cases the supplier might simply be a soft way in.  The hackers who stole millions of customer records, including credit card information, from Target in 2013 appear to have broken into the American retailer’s computers through its heating and cooling system, which was remotely managed by the company that supplied it.  The Wall Street Journal reported that the thieves stole log-in details from the supplier and used these to break in.

Freshfields, the law firm, advises that companies need to address the competency of their suppliers to handle sensitive data in the same way that they would look at insolvency risks.  They should not fall into the trap of thinking that it is just an IT problem — it is far more than that.

For example, they could require suppliers to co-operate in a security audit or to achieve a cyber- security standard.  They might even choose to help small suppliers build resilience into their systems.  And one of the key questions that non-executive directors should ask of executives is, ‘Are you judging the relationship with suppliers based on the financial value they provide and also, on the level of trust we place in them?’.”

It seems like a good idea for non-executive directors to make time to visit suppliers:  Boards should get out more, to do ‘look and see’ visits, to smell and touch what is going on.   Yes, this sort of activity takes significant commitment and will not always be practical, but that said, it is worth the effort when there are big potential risks.  Non-executive directors need their eyes wide open . . . they should also look down the chain at how suppliers treat their suppliers.  You can’t mitigate risks unless you know what they are.

   

Page 2 of 70

On Leadership

Eleanor Roosevelt "To handle yourself, use your head; to handle others, use your heart." 

Useful Links

Leadership and Management Network
This website aims to help you achieve your business goals through building Management and Leadership capabilities.

John Adair Leadership & Management
Official website of Professor John Adair.

 

Restore Default Settings