Lalit Modi: the best Learning and development manager on hire

If you do not believe me, please consider these elements he has juggled in 20-20 tournament of IPL ( Indian Premier Leage ) and judge for yourself:

1. He is developing the young crop of Indian cricketers by providing the best platform of learning for them: real playground with real life situation. No training in the class room. No computerised web based training. No simulations. Direct real-life situations.

2. By pitting best cricketers in the world with the junior cricketers, he has compelled compulsory knowledge transfer of insights, tricks and ideas. I remember Kapil Dev saying in his interview that 'Had he learnt reverse swing early in his career, he would have got 100 more wickets'. This is a biggest bane in Knowledge management in real life organisations. Experts in an organisation do not share their knowledge even in the most knowledge intensive organisations. Organisation further compound their difficulties by 'promoting' competition in favour of collaboration.

3. The learning is not just confined in downloading 'content' ( what to do) but also applying content. Organisations, who pride in spending huge money in learning and development, spend money in downloading content, hoping that individuals will learn to apply content by themselves. Instead Lalit Modi has incorporated both in his IPL format. In order to win matches, senior cricketers have to teach juniors how to sum the situation, how to find ways to score,how to construct an over, how to be positive in the head despite the onslaught, how to anticipate the next action of a batsman and so on.

4. He has roped in ICL in the format by including foreign players so that the tournament can find a time window in the ICL match schedules. By doing this, he has killed two birds with one arrow. One, he has got the best talent in the world. Two, by restricting the foreign players to four in a team, he has got the best cricketers in the world to rub shoulder in junior cricketers. Organisations plan their learning and developement in isolation with rest of the organisation. Even Leadership development programs are planned in isolation with the real-life work in an organisation. Therefore these programs are shunned by the best in the organisation, or worse still, are treated as 'sight seeing' programs.

5. The best part of this development story is that he has 'not asked' for any funds from BCCI. Instead, he has generated funds. Organisation worry about 'return on investment in the development of their employees'. What else one can ask for from their learning and development manager?

So, do you agree with me?

Is developing leaders a necessity for you?

( A practical methodology of developing leaders in an organisation)

Context
With increasing globalisation of business, demanding customers and constant reduction of costs, organisations need to develop more leaders for running their businesses. Leadership development is no more a slogan. With increasing stakes, organisations are actively engaged in developing leaders.

On the other hand, challenges of leadership development exist at both the levels: at the blue print as well as at the execution level. The note here explains those challenges and suggests a possible action plan.

Challenges of leadership development in corporate world
Because leaders need to perform real-time in live situations, they cannot be developed by classroom training. Nor is it a content-download exercise which can be rated at the end as A+. Because leadership skill has to be embedded in an individual’s armoury, the process of developing leader is like growing a plant: partly in our control, partly outside our control. As James March, a researcher who conducted a course on Leadership for Stanford University for 14 years, writes ‘Issues of leadership are indistinguishable from the issues of life”.

Therefore, much like a development of a plant, leadership development cannot be hastened beyond a certain point; the time depending both on the complexity of the requirement, baggage that an individual brings on the table, as well as the kind of people the leader is leading.

Given this difficulty in developing leaders, companies earlier focussed on developing managers. That was enough when industry changes were relatively slow-paced, where majority of organisations followed me-too strategies, or where the systems were relatively ‘closed’ by regulation and other means. Smart ‘managers’ performed the role adequately.

However, when ground rules change quickly by aggressive competitors, managers are always running hard to remain at the same place. Even the risk-mitigating measures of incremental improvement tools like TQM, Six Sigma or Lean do not help. For instance, Fujitsu’s new delivery model in BPO has completely changed the ground rules of BPO industry. On the one hand it promises to solve the customer problems in one shot as well as the inbuilt problems of attrition. But that also has forced BPOs to develop leaders at a relatively young age.

A practical methodology for developing leaders ( and managers as a side benefit! )

Organisations, who have to develop leaders because of their business models, are compelled to take a complete end to end view of leadership development. For them the objective of leadership development is to replenish the pipeline of leaders so that senior ‘positions’ are manned appropriately. They have to walk through all the three stages of developing leaders: Sourcing of pipeline, inoculating and developing the leadership skills, and nurturing the second tier network to enable leaders.

Stage I: Sourcing of leadership pipeline

Three decisions are have to be taken at this stage.

1. One can source the pipeline from the basket of junior pool of employees or hire from the basket of ‘ready-made pool of senior individuals”. Needless to say, both strategies demand compatible recruitment, retention and performance management policies. Business demands and size of organisation also matters because sourcing from junior pool requires large investment. GE and HLL are examples of the first option. So too are business groups like Tata and Birla.

2. The second step of ‘sourcing the leadership material from the pool’ can be executed by two ways. Two methods are used: old method of selecting potential leaders through evaluating employee performance over a period of time, and the modern method of evaluating potential leaders through ‘leadership potential assessment’ centre.

Psychologists are split 50/50 on this. One group believes that individual’s behaviour can be explained by ‘absolute traits’ (and therefore can be evaluated through assessment centres) while the second group believes that it can be explained by the ‘situations’ in which the individual has been placed (and therefore can be evaluated only through real performance in an organisational system). As an example of later, responses of officers in Government are a good example of ‘situational behaviour’. Irrespective of the type of individuals placed in Government, they behave in a similar fashion. The same is true of professionals working as doctors, lawyers, and police force. A lot has been written on this split. For a condensed summary, see my book, The Five great myths of career building, Page 123-132.

3. Because leadership development is a long process, one of the ways to reduce the developmental timetable is to categorise employees and channelize their development in that region. Using an analogy of cricket, we do not need all-rounders that can perform in different conditions and situations; we need batsman or bowlers who will perform in a specific situation.

Stage II: Inoculating and developing leadership

Inoculation of leadership vaccine means establishing the distinction of ‘managership’ versus leadership clear in the mind of corporate participants. In my opinion, this confusion has been the primary source of difficulty in developing corporate leadership skills. A leader ‘negotiates an open system’, while a manager, negotiates ‘close system’. A closed system ( like building a complex bridge) can be very difficult to manage because of the number of variables involved, but the complexity is still ‘static’. For more elaborate definition of leader, see my earlier blog of Leadership.

We engage in open systems and closed systems all the time: in our relationships, in resolving a problem, in achieving our objectives. However, we do not understand the ‘principles’ we adopt in negotiating these open/closed systems, because they are invisible and applied unconsciously. Articulating these principles clearly is therefore the first step in developing the leadership. Another advantage of using ‘systems view’ for leadership development is that the individual can use non-corporate platforms and situations to develop his or her leadership skills. This saves time and also ‘embeds’ the learning in the ‘whole’ of a person.

Developing the leadership skills requires both the elements of action: understanding of ‘what to do’ and the behavioural skill of ‘how to do’. This presents three major challenges

 Enabling leaders to work in multiple ‘people’ systems ( transactional and collaborative) concurrently so that they find time to prevent fires instead of spending time only on dousing fires

Transactional system enables executives get their work done in short time with minimal effort (with the fullest use of their power and status). This constitutes majority of their tasks. However, they also have to engage in collaborative systems to ‘resolve problems’, develop new ways to solve old problems, and generate insights ahead of a problem. This however requires more time with people and less use of positional power. If a senior executive does not get the right balance between the two systems, he/she spends all his/her time in dousing fires, instead of preventing fires. Once an executive is caught in this vicious cycle, he/she keeps on working for 60 hours a week but still producing lower-than-average results.

 Sharing the difficulties in synthesising work system with people system to achieve organisational objectives like knowledge management and innovation.

Innovation or knowledge management require harmonious synthesis of people and work systems. When executives rely too much on work system to manage their ‘knowledge’ the objective is not achieved. Big IT systems are created with no addition of knowledge. Innovation also happens out of the ‘chaos’ created in the work+ people system. If we move too early to ‘rein’ the chaos, we miss the innovation.

 Inculcating the understanding plus behavioural component in the armory of an individual through use of one-to-one coaching, shadow coaching or group coaching.

Non engaging situations in classroom, WBT simulations can develop the understanding, but developing the requisite behavioural skills requires online responses to real-life situations. This requires embedding the skill into the ‘whole’ of a person. This therefore requires coaching. Without real-time coaching, behaviour skills cannot be imparted. Learning remains conceptual. In certain difficult instances, even shadow coaching (shadowing executives in meetings and interactions) is required to provide ‘accurate’ inputs to the employee so that root cause identification happens immediately without any bias.

Embedding also needs understanding the individual’s background habits, family life and personal hobbies so that learning is incorporated in a personal kit of an individual. Certain insights and appreciation can be acquired only after reframing an event in personal life. Coaching is an art, because it demands intervention without ‘intruding’ in a person’s life.

Although many tools and ideas exist in developing leadership skills, the real challenge is ‘embedding’ them in the system ( ethos and habits ) of an organisational work. As Henry Mintzberg, highly acclaimed management researcher, puts it aptly “ the crux lies in adapting the ideas , and not adopting them”.

Stage III: Nurturing the second tier to enable the leaders

It is well accepted that even leaders deliver results when they have good teams to lead. Top talent is more effective when it operates in vibrant internal networks with a range of employees. Without the social network of capable performers, leaders cannot perform for a sustained period.

Fortunately, leadership development program can itself help us develop a second tier of capable steady performers. As the leadership process is linked closely with the personal self development process, no one can guarantee that all potential aspirants will become leaders. These so-called ‘unsuccessful’ individuals can help create a band of capable performers who can excel in their function, be it sales or delivery. In other words, developing Managers can be a ‘secondary output’ of this program. Although this cannot truly substitute the manager development program, it can partly cover the gap.

Action plan for an organisation

Given the current HR processes in any organisation, leadership development cuts across all the three functions of Talent acquisition/allocation, Talent management and Talent deployment. At the minimum it requires tying up of four independent processes:

 Utilising current program to identify and track potential leaders
 Altering the Conventional design of LDP training program to include relevant elements such as ‘systemic’ intelligence, managership versus leadership etc.
 Utilising Talent acquisition/allocation team to allocate potential leaders to identified roles/positions so that coaching is used effectively, and
 Utilising Succession Planning to plan for key leadership positions.

Organisation-relevant definition of Leadership

Leadership has become an oxymoron, a meaningless word in the corporate world.

We attempt here to ‘redefine’ it with the specific purpose of making it ‘practical’ and useful’ for developing leadership qualities in corporate executives. The purpose is to extract its implicit meaning we have in our minds and articulate it as precisely as we can so that we can not only practice it but ‘develop’ it when we see its absence.

Section I: Why another definition of leadership
Section II: Towards a new definition of leadership
Section III: Organisation-relevant definition of leadership and its implications
Section IV: What is needed to develop leadership in corporate world

Section I: Why another definition of leadership?

Leadership is a much misunderstood concept in corporate world because it exists in many versions.

Trainers 'label' many of their programs as 'leadership development programs', even when they are not meant to develop leadership. They go a step further by claiming that leadership can be practiced at any level and by anyone. This is the Western view of human development: you can do anything if you have the willingness and drive to achieve it. This propagates leaders who take charge from the front, ignoring the leaders who lead from behind.

Versions also proliferate because of reluctance of researchers in defining leadership. Researchers interview and study CEO's and political leaders, decipher common traits and behavior (such as integrity, customer focus, result focus etc) and claim it as a common denominator of a leader. They do all this without ‘defining’ leadership. In their quest to identify leadership traits, they may even forget that many of the CEO's and leaders they interviewed may have been 'administrators'.

Some argue that we should not define leadership because we may fall in the pit of claiming that there is only 'one' definition of leadership. On the other hand knowledge cannot be built until one defines something 'precisely'. Not defining precisely makes it easier to claim 'anything and everything' as leadership, which is happening right now.

Without precise definition of leadership, what do companies currently do about ‘skilling’ their leaders? Because they need capable leaders, they have taken an inside-out approach of developing leadership traits. They define five, six or seven leadership traits as being ‘absolute’ and then proceed to inculcate those ‘traits’ in their top executives. Assessment centers are designed to assess and evaluate these traits.

Psychologists are today convinced that absolute traits ‘alone’ do not explain the behaviour of an individual. Equally powerful determinant of behaviour is the ‘context’ of the situation. ( This is why we may be ‘honest’ with friends, but not be honest with others. ) Some even argue that there is very little difference ‘of traits’ between the leaders and non-leaders; the difference lies in how the leaders use their ‘traits’ in a given ‘context’. Because the second half - the competency to deal with the context - is not understood well, it is neither ‘taught’ nor ‘enabled’.

Because of the above, corporate leaders today are developed through luck and chance, rather by any design or plan. With a precise definition of leadership, HR can provide the potential leaders the right 'practice ground' to develop leadership. HR will know which positions are not good for practicing leadership. It will also know what it needs to do help executives practice leadership. It will enable HR set realistic expectations from itself. HR will invest more carefully in training and developing the right people, instead of trying to practice it all levels. This will mean getting more returns from the efforts, better grooming of leaders and better succession planning

Section II: Towards a new definition of leadership

Rudolph Giuliani's resurrection of New York after 9/11 is one example of leadership development which is often quoted. Reviving a city/institution after such a tragedy requires extraordinary capabilities to bring together all stakeholders, chalk out an action plan and execute it. But is this leadership?

Is 'removing terrorism' same as 'removing terrorist'?
Is countering the practice of anti dowry same as passing the 'anti-dowry' law in the parliament?
Is instituting 'secured transport' in a city after 11 pm same as instituting anti-criminal police practices in the city?

If you observe closely the difference in the first and second act, you will get the glimpse of leadership concept. The first act requires understanding of 'interrelated systems', while the second requires understanding of 'linear systems'. The first act requires a far difficult juxtaposition of initiatives and stakeholders, while the second requires a 'one dimension action' against the dissidents. The first act requires dealing with ‘dynamic complexity’ (complexity created because of interrelationship of variables) while the second act is dealing with ‘static complexity’ (complexity created due to number of variables).

In short, the first act requires the ability to deal with Open ‘systems'. It is a word which has precise definition, derived from Systems theory. For more details see Frijtof Capra’s book The Web of Life.

This is where we have a first definition of leadership: the kernel

Leadership practice is an ability to influence large open system(s) in a sustained manner.


What is the essence of leadership practice?

Is it managing an open system? Every operating system ( be it business unit, geography, or a function) is an open system because it is influenced by multiple systems. But even a relationship with spouse, influenced by multiple systems like finance, kids, and friends and so on, is an open system. However we do not wish to term 'managing relationship' as leadership practice.

Is it managing a ‘large’ system? Largeness can be defined by physical boundary, such as eco system. Eco systems are difficult to influence simply because of their largeness. A virtual system in an organization however can also be large. But largeness alone does not differentiate leadership practice of say a freelance entrepreneur (such as a doctor working in a clinic, or a photographer working in entertainment industry) visavis a corporate executive? Both must understand the large open system - of which their operating system is part of - to find how they can influence. So what differentiates the two?

The corporate executive has to influence the 'internal open' system to execute the 'strategy' that he/she has deciphered from understanding the 'external open' system, while the freelance entrepreneur only has to influence the external open system to discover a sustainable strategy.

In other words, essence of corporate leadership practice involves management of two kinds of open systems: one, to understand the 'external open' system to 'decide' strategically the requirement of influencing it, and two, to 'execute' that decision by influencing the 'internal open' system ( which is nothing but the operating system).

'Execution' requires consensus of the direction to take. Imagine what Gandhiji could have gone through to develop a consensus that ‘Independence to India should be pursued by following the path of non-violence' amongst other contending alternatives. Consensus is also required to create 'enough variety' in the system. 'Variety' is the ability to understand the requisite variables in the environment and respond appropriately. If variety is not enough, each person in an organisation may follow different path, halting the progress of the organisation in a specific direction. If too much time is required to generate the consensus though, the opportunity window may close. In other words, influencing internal open system is a big challenge.

Lastly, corporate leadership practice is also about taking actions that will sustain the initial trigger. Executives are often seen to take one-off actions that can be sustained only by sheer willpower and/or a 60-week schedule. Sustained manner means taking an action which can be sustained by the ‘system’ after the initial trigger is off.

Section III: New organisation-relevant definition of leadership

Leadership practice, in short, requires two criteria to be met

Part I: Understand large open system (of which the operating system, say the business units, is a part) to chose the 'mountain' to climb (that will enable the operating system to influence the open system in a sustained manner).

Part II: Enable the 'large operating system' to scale the mountain so that elements of operating system follow appropriate course/path in a self-sustained manner (which includes the ability to course-correct) irrespective of the changing circumstances (which may therefore include the decision to change the mountain).

In non-systems language, we can call part I as ‘developing a sustainable strategy’, while Part II as ‘executing the given strategy in a sustainable manner’. We are however using the language of ‘systems’ because HR has to understand the ‘theory of leadership’ to apply it anywhere. They have to diagnose a given position for its leadership potential, or a leader in a given situation.

This definition tells us what leadership practice is and what is not.

One, a CEO of a company selling ball bearing, exclusively to automobile industry, has to understand a large open system involved, as well as a CEO working in a General Motors. The difference is in scope of the largeness of the open system. Part I and Part II actions are required by both CEOs.

Pressurised by stock options, shareholders and boards, CEOs develop strategies/plans to show that they are at helms. In the process they develop 'me-too' strategies that are unsustainable. They look good on paper but fail to pass the test of ‘sustaining’ the advantage. Or they just believe that 'hard work' alone can help them scale the mountain. These CEOs find it convenient to blame 'people' for poor 'execution'. Execution therefore has become a buzz word of corporate success.

Two, a senior executive heading a support department like HR, Training or Finance faces a different set of open systems to ‘decide’ the mountain than a senior executive of a SBU facing a customer. The difference is in the dependency: one is dependent on truly external open system (customer); another is dependent on the business unit’s view of external open system.

Because of this dependency, if business executives in their organization lack the skill of first part, an executive in support department may ‘lead’ his/her function in a ‘wrong direction’. Fortunately, as we shall see later, other options are open to this executive which may still enable him/her to practice leadership.

Three, Part II actions seem to be a bigger differentiator than Part I actions in defining a leader due to two reasons.

One, ability to self-sustain the course requires one to develop a team which can function without the leader. We have seen many well intentioned initiatives suffer when the 'hero' leader leaves the team without developing his/her team sufficiently. Many small companies remain 'small' because of this lack of ability. Part I executives will remain as entrepreneurs and innovators.

Further, lack of Part II understanding also reflects in wrong choice of strategies, which is a Part I action. Many strategies (arrived after understanding the open system) are impractical to implement because they require many system elements to converge with the 'goal'. Part II-unaware leaders are completely ignorant of how to achieve this. For instance, very few executives know how 'vision and values' can help system elements to converge.

The difficulty in managing Part II actions seems to be arising due to dual nature of an organisation: on the one hand an organisation is a ‘mechanical system’ meant to achieve a given purpose in a predetermined way, while on the other hand it is a ‘living system’ of people which provides the required ‘variety’ to the system to bring in flexibility and innovative solutions. Both are needed. But MBA executives learn to manage the first, miss the second. For MBA executives, execution is about 'controlling' everything, which is the model of an Army commander. Organisational leaders learn to manage the living system, and more importantly, how to make the ‘living system’ coexist with the ‘mechanical system’.

Four, this definition of leadership also shows that leadership can be practiced in certain positions and in certain situations.

For instance, in difficult times, one may need a different set of actions, such as Louis Gestener did when he was brought to revive IBM. At such difficult times, stopping the hemorrhaging is more important than developing a sustainable strategy. Moreover, as organisational elements converge on the ‘to-do actions’ more readily due to crisis, Part II challenge is minimal. ( Louis Gestener also had the insight to leave IBM in time because he knew that it needed a man who understood the ‘internal system’ of IBM! )

Similarly, at a junior position, when sufficient options are not available in the ‘operating system’ of which the junior person is in charge, one cannot practice leadership. Neither Part-I is an open system or Part II is an open system at a junior level. Part II internal system can be made ‘open’ in certain situations. For instance, small project in a software company is not a sufficiently open system to practice leadership, but organizations can create a much larger open system if the project size is large and multi dimensional.

High variety situations, where lots of options seem to exist, are often confused with ‘open systems’. For instance, customer-facing positions of delivery in airlines, hotels, or banks ‘generate’ lot of variety. Such high variety positions can create ‘conflicting’ demands on HR! For instance, these positions demand initiative and flexibility on the one hand, and compliance with processes and system on the other.

But, it is my suggestion, that we should restrict leadership positions to mean those positions where both internal and external systems are sufficiently open (which in turn would necessitate both Part I and Part II actions). Whenever a system is relatively closed, it has a potential of being manned with an able manager or administrator.

Five, this definition also makes it easy to understand why leadership practice is more prevalent in ‘open system’ social arena than in relatively ‘close system’ organizational arena. We intuitively knew that there is a parallel we corporate executives can use, but we never knew the limitations of drawing that parallel. This definition brings out the limitations starkly.

Section IV: What is needed to develop leadership in corporate world?

Part I skills are taught by B schools. A MBA definitely learns how to develop a strategy. He knows the elements involved in developing the strategy and can find out quite easily what every competitor is doing and why. This is a big step in learning Part I skills.

The second step is however quite difficult: finding a strategy (it is also called developing business model) that will help company sustain it’s competitiveness over a long period of time. Because nothing is difficult to replicate over a long period, it is about gaining the lead that is difficult to catch. For a fashion industry, lead of 6 months is difficult to catch. For an old industry it could be 6 years.

The difficulty of second step is apparent when you see two companies bashing each other with similar strategy. Pepsi and Coca Cola is a good example in India. They have been following similar me-too strategies and bleeding profusely in India. But no one is backing out. Jim Collins reports in his book ( Good to Great) that the 12 leaders, who achieved constant growth over 75 years, took a very long time (about 6-8 years) to get the business models of their company right. So although the first step can be learnt, the second step requires understanding of the deeper dynamics of an industry to evolve a sustainable strategy.

Part II skills are currently taught in bits and pieces.

Generating dialogue amongst the senior management team has been well researched and understood. Performance appraisal systems to align individual goals to organisational goals are understood well but they are too static to deal with the challenges faced on the ground.

Work on rewards and incentives – based on Pavalovian model – unfortunately do not help us in influencing today’s individuals who want something ‘more’ from their jobs. It is therefore not surprising to find that jobs in social system, based on voluntary commitment, are more easier to ‘man’ than a job in corporate world.

The biggest knowledge bottleneck in Part II is in designing the ‘whole’. We have understood a lot about individual part elements, about vision, values, and organization structural options, MBO, Balance Score card and others. But our knowledge of putting these parts together into a whole is still an art, not yet developed into a science. This is where largest efforts shall be required in developing learning material that can help executives learn ‘Part-II’ actions.

Part II is about understanding internal open system requires understanding of the recursive effects of actions, the interdependencies inherent in the sequencing of actions, the realistic understanding of the current situation without the bias, and using symbolic effect of an action. (A subset of this is called 'change management'.) One can use countless examples happening around us to develop this Part II competency. For instance, asking ‘how should BCCI have responded to the Harbhajan controversy’ will help us evaluate the understanding of the managers in this arena.

However the more difficult part in developing Part II competency is knowing that Part II is not just 'understanding' content, but being able to 'act on it'. It is accompanied with behavioral component. This therefore requires 'simulation of a situation'.

Learning any competency is also related with measuring it so that corrective actions can be taken by measuring the as-is status. Consequences of Part II competency are visible in the 'reportees', 'colleagues' and above all the family members of the aspiring leader. Taking advantage of this impact, one can do a 360 degree feedback and indirectly measure this leadership competency. Other visible but indirect indicators like work-life balance, ability to react under stress, active sense-making can also be used as a substitute.

To summarise, leadership development would need

o Preparing Learning material ( that should include case studies, role plays
and simulation ) on
- Part I: ‘Dynamic’ strategy development both for BU heads and functional
heads ( normal strategy development is pick and apply
- Part II: How to generate the competency of influencing the ‘operating
system’ to deliver the outcome of Part I. (Larger and widespread teams
require different expertise and tools.)

o How to develop the above two competencies by using multiple channels
(using multiple channels will help produce results in shorter time) like
- Organisational interactions such as meetings, mentoring and others
- Parenting
- Automatic sense-making in social interactions and media
- Development and pursuit of hobbies
- Fulfilling other responsibilities such as living with old parents,
developing friends, building social network

o Preparing diagnostics on
- How to diagnose ‘positions’ in an organisation for their absence/presence
of leadership potential (We do not need a leader if the same position can be
manned by a manager or administrator)
- Measuring Part I/Part II competencies ( continuously) in an individual to
identify and rectify the gaps

Post Script

The above definition of leadership has deeper insights for a leader in social arena, because a NGO executive, unlike a corporate executive, is forced to engage with open systems all the time. Because social initiatives are high on ‘passion and commitment’, but low on ‘practicality and results’ leadership development offers them a high leverage option. However, we shall not deal with it, because it will divert our attention from developing leaders in ‘organisational situations’.

References

James March, the researcher who conducted a course on Leadership for Stanford University for 14 years, writes after his experience that ‘Major Issues of leadership are indistinguishable from the issues of life”.

Having identified the challenges of development in a human being through my 5-year long research on career building ( the book of which has been published by Macmillan), I took this leap to define leadership.

Systems theory has been my primary vehicle of both understanding leadership and now, as I see it, developing leadership. Systems theory has also got very evolved and crystallized since 1990s. In contrast to earlier days, we can now use it to build and develop practical leadership skills.

Making leadership practice work

The real proof of pudding is in eating it. An erstwhile HR collegue challenged my definition of leadership by asking a simple question " Can you tell me if my position of VP-HR a leadership role or managerial role?". So I set about attempting to test my definition.

What 'should a VP HR do' in an organisation? Because he is not dealing with 'external customers' his external open system is defined by the 'business units' he is serving. So should we ask SBU heads 'what do they want from HR'? But this is like asking a question to a father 'what he wants from his child'. It is often a wish list which is devoid of any realistic understanding of the ground reality. So what can one do?

Perhaps, it is necessary to understand what 'businesses' is HR servicing. Only then, one can ask the next question, 'what one needs to do to hire/retain and develop the people required in that business unit'. When I did this quick analysis with my HR friend, we realised he is serving four different businesses whose skill-sets are entirely different. In other words he requires different HR policies for each of them, if he wants to service them meaningfully. We were both surprised that one HR policy was being used currently. We also realised that best answers of what should be done by HR, is best answered by experts in HR and other past VPs who have been in the same function earlier.

As we explored the question further, we discovered that this question of what should be done can be best answered by the internal stakeholders of HR who are currently serving these HR units. When we talked with them , we understood why business heads do not respect their judgement, why HR is still seen as a 'transactional provider', why HR is brought at the fag end of a conflict when the employee is just to leave. This made us realise that even if find 'what should be done' by HR, we still cannot 'execute it' because the organisation does not perceive HR to be an important function ( although all senior managers do not say it openly).

In other words, even before VP-HR can hope to do anything meaningful for the organisation, he cannot do so until the organisation system provides him enough 'power' to accomplish it. This meant that his first 'should-be' action must be 'gaining trust and credibility of the business units' before he can even meaningfully service those businesses. This is both an opportunity and constraint for him; opportunity- because it will give him more time to understand what should be done- and constraint - because he has to learn to be patient and wait for the right time to launch his plans.

As we explored this together, we realised that 'gaining credibility' is a far more meaningful objective for his system, than just rushing about, launching some new actions or doing something visible for the sake of it. Even this seemingly simple objective required a set of packaged cohesive initiatives to be implemented in next 3months. Contrast this with what a manager would have done.

A manager would be wanting to sit in the drivers seat and take charge from front. A leader however learns to wait for the right time and wait in the background till that time. A manager bangs his head against the wall and blames others for not responding to his initiative; while a leader by setting his expectation 'right' enables his team to 'synthesise' his team's energies and achieve 'traction' to set up the next move. A manager by taking wrong actions reduces his credibility ( making it difficult for himself for the next round), while the leader 'accumulates' small wins to generate 'credibility'. Although this is not a full fledged description of entire analysis, you can realise the difference between two roles starkly.

In other words, a position ( like VP-HR) offers both options: of practicing managerial and leadership roles. Which role one takes from the two is determined by the person's individual attitude and his/her skill set. Most of the individuals take the role of 'manager' by default, because they are ignorant of the other role. But, as i talked to my friend, we realised that this role is a 'culturally difficult choice' to take. Let us explore that difficulty in the next blog.

Measuring Leadership competency

One of my friend said that without being able to measure leadership competency, this idea will be difficult to implement. So today we shall explore the different ways of measuring the leadership competency, as we have defined it.

Measuring Part I competency of understanding external open system is quite simple. It is also called an ability to 'strategise' in a normal language. For a business manager, this competency therefore is quite straigtforward to measure.On the other hand, functional managers who deal with internal open system will find it difficult to measure their competency. How does one measure one's ability to find the right way of doing things internally in an organisation?

For instance, how should one launch an initiative of developing leaders in an organisation? This requires understanding of internal open system which managers/leaders often lack. Researchers call this 'change management'. This is not difficult to measure because one finds countless examples that can be used to assess this competency. For instance, how should BCCI have responded to the Harbhajan controversary?

If Part I competency is about understanding what 'should' one do, Part II competency is about understanding what 'can' one do. Assessing this understanding requires understanding of the recursive effects of actions, the interdependencies inherent in the sequencing of actions, the realistic understanding of the current situation without the bias, and often the symbolic effect of an action. This is more complex than Part I and may have to be decomposed a bit before one can assess it.

However the more difficult part in assessing Part II competency is knowing that Part II is not just 'understanding' content, but being able to 'act on it'. It is a skill. This therefore requires 'simulation of a situation' and can be quite difficult to measure. One can however take refuge in the knowledge that Part II competency is visible in the 'reportees', the 'colleagues' and above all the family members of the aspiring leader. Taking advantage of this consequence, one can do a 360 type of feedback and indirectly measure the leadership competency. Other visible indirect indicators like work-life balance, ability to react under stress, explanations of a leader can also be used as a substitute.

More importantly, one has to always remember that metrics can also lie if viewed outside their context. For instance, one should remember that when a leader is undergoing a transition, say from a functional manager to a business unit manager, one will not be able to display these competencies during the transition time. Ram Charan's six pasages of Leadership pipeline show such six transitions in the life of a leader.

In short, measuring the development of leadership competency in an aspiring leader is not difficult to determine, although some efforts will have to be taken to achieve this.

Learning Leadership

Today, let us take a different direction. If leadership is about learning to deal with open systems, what are we doing currently to teach it?

Part I activities are being taught by B schools. A MBA definitely learns how to develop a strategy. He knows the elements involved in developing the strategy and can find out quite easily what every competitor is doing and why. This is a big step in learning Part I. The second step is however quite difficult: finding a strategy (it is called developing business model) that will help his company sustain its competitiveness over a long period of time. After all, remember, nothing is difficult to replicate at the end. So it is about gaining the lead that is difficult to catch. For a fashion industry, lead of 6 months is difficult to catch. For a old industry it could be 6 years.

The difficulty of second step is apparent when you see two companies bashing each other with similar strategy. Pepsi and Coca Cola is a good example in India. They have been follow similar me-too strategies and bleeding profusely in India. But no one is backing out. Jim Collins reports in his book that the 12 leaders took a very long time ( about 8-12 years, I guess) to get the business models of their company right. So although the first step can be learnt, the second step requires understanding of the deeper dynamics of an industry to be able to evolve a significantly sustainable strategy.

Part II activities are taught in bits and pieces. Generating dialogue amongst the senior management team has been well researched and understood. Servant leadership is understood, although one does not know how to practice it in the real environment of a competitive corporate world. Performance appraisal systems to align individual goals to organisational goals are understood well but they are too static to deal with the challenges faced on the ground.

Work on rewards and incentives – based on Pavalovian model – unfortunately do not help us in influencing today’s individuals who want something ‘more’ from their jobs. It is therefore not surprising to find that jobs in social system, not based on salary and rewards but on voluntary commitment, are more easier to ‘man’ than a job in corporate world.

The biggest knowledge bottleneck is in designing the soft architecture of an organisation. We have understood a lot about it: about using vision, values, organization structural options, MBO, Balance Score card. But every element is a ‘part’. We do not know how to put together all the pieces in designing a ‘soft architecture’ of the organization.Researchers therefore throng to companies like SEMCO who have designed a different soft architecture, but fail to understand how it can be done in another company.

Instead, the trainers and the industry have taken an inside-out approach of teaching leadership qualities. It defines five, six or seven leadership traits as being ‘absolute’ and then proceeds to inculcate those ‘traits’ in their top executives. Assessment centres have been designed to assess and evaluate the ‘leadership qualities’. But this is just one half of the requirement. The second half - the capability to deal with the external or internal ‘system’ is not even understood – leave along ‘taught’ or ‘enabled’. We therefore have to rely on luck and chance to find our leaders. Rests remain as managers.

Refining Leadership: Attempt 3

Let us discuss two more observations emanating out of our definition of leadership.

One, in the corporate arena, most of the executives - pressurised by stock options, shareholders and Board - have to develop plans to show that they are at helms. In the process they develop 'me-too' plans that are unsustainable. They look back at their 'people' and say it is all about 'execution'. Execution therefore has become a buzz word of corporate success.

On the other hand, leaders rarely spend time on on developing Part II actions (which is about executing the Part I output) that can sustain the organisation, because Part II is about developing people; developing the soft architecture of the company to generate the requisite variety. Execution to these corporate executives is about 'controlling' everything that happens on the ship: the model of a Army commander. This is exactly the opposite of what leaders practice.

Two, this brings us to the second interesting dissonance of leader; their popularity. Popularity of leaders is almost antithetical to a good leadership practice. If you realise that a true leader is the one who is not even known by those she/he leads, the popularity acts as a significant dampener in practicing leadership. Tracy Kidder's book ( Soul of new machine) about the development of first mini computer clearly shows that people who were involved in the development did not even know who was spearheading the effort of computer development.

It is not surprising to note that even the leaders of the 12 best companies ( the companies which performed significantly above average for more than 7 decades) discovered by Jim Collins were not as popular as the others who were heard in the media.

Popularity of a leader makes 'one man/woman' become more responsible for the entire effort, and transfers the contribution made by a group of people to one person. Leader knows that is not what he has done, nor people involved in the effort believe that they are being led by anyone. The concept of Servant leadership is not new, and has been in vogue for quite a long time. Robert Greenleaf's book captures it quite well.

This is an interesting dilemma for a leader. In order to practice Leadership of Part II, a leader has to let go 'popularity' because people like to take charge of themselves instead of being led. If the leader however has to sacrifice popularity, then what is the end benefit to a leader? Why should a leader practice true leadership if he/she is not even getting any credit for the end result?

Could this be the reason why true leaders are difficult to find? Are we asking too much from them? Or is it pointing us to another quality of a leader: the quality that makes them give up 'credit' because they realise that they only played their 'role'. The quality of 'humility' emanating from the understanding that we human beings are after all 'elements' of a bigger system.