Have you ever wondered why there are so many stories of individuals and management teams who have failed to align their actions with doing something good to benefit other people? In our global society, there is a need for global leaders to use both “out of the box” thinking and traditional management principles.
In his book “Good to Great: Why Some Companies Make the Leap and Others Don’t,” author Jim Collins compares 11 “good-to-great” companies against their competitors. Some of the companies mentioned in the book include Abbott, Fannie Mae, Kroger, Philip Morris, Walgreens and Wells Fargo.
The managers and executives of some of these companies led the organization in a direction that caused trouble, which could have been avoided with better management from those global leaders. For example, CNN reported in 2017 that Wells Fargo found a total of 3.5 million bank and/or credit card accounts that were fake. According to Tim Sloan, the CEO of Wells Fargo, these fake accounts were set up by Wells Fargo employees in an attempt to allow them to reach unrealistic sales goals.
Is this pressure to conform with unrealistic sales goals a leadership or management problem? Yes. The high level of management required to be a good-to-great company should not only have prevented this problem at Wells Fargo, but also future problems from occurring. However, it seems that the company’s global leaders and the lack of good management were the driving factors that influenced these Wells Fargo employees and their actions.
Management experts Gareth R. Jones and Jennifer M. George define leadership as “the process by which an individual exerts influence over other people and inspires, motivates, and directs their activities to help achieve group or organizational goals.”
Unfortunately, there are several people who believe that all a leader needs to do is read a few good books and follow those books’ principles to lead any organization to greatness. Within the armed services, for instance, there are great reading lists, such as the United States Marine Corps Commandant’s Professional Reading List.
However, just reading books does not guarantee that anyone will become a great leader. Organizations now realize that one leadership style may work for a specific type of company or for one particular stage of development, but there may be a need to change that leadership style later to help the organization grow and succeed in the future.
The Different Styles of Leadership
Kurt Lewin, a German-born American psychologist and an expert in social, organizational and applied psychology, states that a leader’s decision of what style he/she uses is based on the need of the decision to be made. According to Lewin, there are three styles of leadership: autocratic, democratic and laissez-faire.
The autocratic leader, for example does not consult others or involve a team in the decision-making process. Decisions are solely based on the leader’s expertise and experiences.
By contrast, a democratic leader often makes the final decision. This type of leader seeks the input of a team and uses the recommendations of others to make decisions.
A laissez-faire leader offers very little input in the decision-making process. This leader allows a team to find or create solutions.
Autocratic leadership works best in an environment where the leader’s brand and vision are more important to the leader than the desire to consult a team for input. This leadership style works well in an environment such as a Michelin-star restaurant, where the chef or restaurant owner knows the standards that must be met and all that is required is a dedicated staff to follow instructions.
Other characteristics of autocratic leaders include:
- Little to no input from team members
- Leader makes almost all of the decisions
- Organization’s leader dictates the work methods and processes
- Group members are rarely trusted with decisions or important tasks
- Work tends to be highly structured or rigid
- Following rules and instructions precisely is very important
- Rules are clearly outlined and communicated
Famous autocratic leaders are:
- Ridley Scott, the director of Hollywood films such as “Alien,” “Blade Runner,” “Thelma & Louise,” “American Gangster” and “Gladiator”
- Lorne Michaels, the producer of NBC’s “Saturday Night Live”
- Helen Gurley Brown, the former Editor-in-Chief of “Cosmopolitan” magazine
- John Chambers, the former Chairman of Cisco Systems (2016)
Democratic leadership works best in an environment where the leader wants to involve other people in the decision-making process. This method of leadership works well when there is a group of peers or an organization with a leader who takes the role of facilitator.
However, this leader relies on the individual expertise and input of other team members. A democratic leadership style is often appreciated by these team members, especially if they are used to an autocratic decision-maker from a previous job.
Famous democratic leaders are:
- Indra Nooyi, the CEO/Chairman of PepsiCo
- Bill George, the CEO of Medtronic
- Tommy Lasorda, the former baseball pitcher and coach of the LA Dodgers
- Ginni Rometty, the CEO of IBM
Laissez-faire leadership focuses on minimizing a leader’s involvement in decision-making and allowing people to make their own decisions. This type of leadership works best when capable people are motivated to make their own decisions and stay focused on the requirements to reach an end goal. This leadership style is best used in an environment of scientists, researchers, or creators who working toward developing innovative ideas.
Famous laissez-faire leaders include:
- Herbert Hoover, the former President of the United States (March 1929 – March 1933)
- Andrew Mellon, a business leader and philanthropist
- Martin Van Buren, the former President of the United States (March 1837 – March 1841)
- Queen Victoria, Queen of the United Kingdom of Great Britain and Ireland (1837-1901)
- Warren Buffett, an American businessman
Managers Have Countless Opportunities to Become the Best Possible Global Leaders
We live in a world where there are countless opportunities to obtain amazing management degrees from top schools. There are also several extraordinary leadership and development programs available within certain corporations so their employees can continue to develop into future global leaders.
Leadership is not a magical power reserved for a select few. Unfortunately, possessing the core values to develop good leadership skills and applying them towards doing good continues to be a rare quality for some global leaders.
In his book, Collins describes the importance of finding your “Big Hairy Audacious Goals” (BHAG). According to him, these goals involve what you are deeply passionate about, what you can be the best in the world at and what drives your economic engine. If being a great leader is your ultimate goal, then you will need to find the BHAG of your organization.