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.