There was time when it took an enlightened and strong-willed leader empowered with great controls to shepherd a business in both prosperous periods and periods of troubles. Leadership was all about leaders and their personal qualities and traits as employees and workers were regarded mere followers with little to no say in the strategic and day-to-day management of a company.
This old-school and top-down management style is being replaced by a horizontal management where you have leaders at all levels of the organization and where management relies on trust to create an effective leadership strategy. The success of a business, especially innovative and fast-growing ones, is tied to one-person leadership qualities or geographical location no more.
Achievements of modern-day businesses are more about collaborating to achieve common strategic and tactical goals within organizational environments that are almost flat when managerial duties and qualities are concerned.
The Figure of the New Leader
We will always see a leader representing a business on top level and appearing in the lights of the media, which does not mean that today’s successful business needs a “special” leader having almost unlimited powers within the company as it was 20 or 30 years ago.
If you take a look at business leaders such as Steve Jobs, who was one of those who changed the way corporate leadership works, you will see a charismatic person while his main quality was not charisma but his ability to mobilize the abilities of other people around achieving a common goal in a collaborative manner. This is a random example but it characterizes a new approach gearing toward collaboration and shared values across an entire organization, and one operating at global scale.
It is not an oxymoron to have a charismatic yet collaborative leader. There were many of them in the past but the problem was they had to operate in an environment where strict hierarchy and undisputed execution of orders by the top management was the accepted management style.
Such a leadership style simply does not work in a global economy that is increasingly based on knowledge and where soft leadership skills are becoming of much more value.
Differences between Managers and Leaders
|Focus||Leading people||Managing work|
|Approach||Sets direction||Plans detail|
|Power||Personal charisma||Formal authority|
|Exchange||Excitement for work||Money for work|
|Direction||New roads||Existing roads|
|Concern||What is right||Being right|
Transparency and Engagement Define New Leadership
Leadership skills are still in high demand but these are not the hard skills of the past. Business leaders used to be specifically grown by developing their hard skills such as use of market analysis, application of specific HR methods or use of business intelligence practices across a variety of scenarios.
Businesses are now moving to a new stage where soft skills such as transparent and honest behavior as well as achieving trust through leading by example and communicating issues without hesitation is producing better results. At the end, there are many people who can use business intelligence tools to derive a working business strategy.
Convincing people this is the right strategy and making them contribute to this strategy is what matters in today’s circumstances. Moreover, people are now expecting to share their opinion on everything and thus you should engage them into discussing strategic business moves at the work place.
Loose Controls to Build Effective Leadership
Many people still believe that business leadership is about controlling everything within an organization – from financial flows through procurement to the last employee. It used to be this way a century ago but now it is about giving higher level of autonomy to every employee and eliminating unnecessary controls.
Freedom and independence at work produce better overall results, just ask companies such as SquareSpace who embrace “flat, open and creative” corporate culture and which is considered as one of the best places to work in New York. Openness and less managerial levels characterize a good number of other relatively new and successful companies like Zappos, Buffer or Netflix.
Netflix, for instance, does not track your work hours (which is still a primary tool to assess performance and control employees) but evaluates your work based on your abilities and accomplishments. But if you are to introduce such a method for evaluating your employees and the quality of their work, you should also build rapport with them to trust you with your decisions and strategic guidance. It is actually about relaxing management controls to increase the role of a trustworthy leadership and getting happier, more engaged and more efficient employees as a result.
Creating a successful management and leadership model based on trust is not a one-way process. You need to trust and demonstrate that very trust in your employees and partners before you are to expect sincere trust by them.
The same actually is valid even if you are a leader with great powers within an organization with multiple tiers of management and top-down approach toward decision making. If your employees do not trust you, their performance will suffer and many goals will not be met despite your ability to enforce strategies and decisions through the means of hierarchical authority.
The thriving startup culture of late is gradually making the traditional leadership and organization structure models obsolete and ineffective. We are shifting toward a flatter model of management where trust and shared values play more important role in a company’s success and where a leader is considered a first among equals.
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