Companies from all over the world are thinking differently about values, culture, trust, transparency, meaningful connections and collaboration. These characteristics are different from command and control organizations where power is the province of the few and information is tightly controlled. This traditional ethic has led to uneven performance, escalating self-interest, growing dissatisfaction with companies, missed opportunities and even scandal, but talent leaders can help companies to envision a different future by enabling a new brand of leadership.
Living examples of this new future are led by people who have a different view of what leadership means and can do. They view it as a behavior, not a title. It is more about relationships and connections than power and authority. They don’t coerce or threaten to achieve results, they inspire others to act. They pursue significance beyond the immediate and short-term. They demonstrate “humbition” — a humble personal perspective accompanied by a fierce ambition for the organization’s success. They help to create a culture bigger than themselves so the organization endures.
Researchers John Zenger and Joseph Folkman uncovered similar findings in their multi-year research detailed in their book The Extraordinary Leader. They examined more than 200,000 surveys for 20,000 leaders with correlated company performance data. The most important factors that distinguish the best from the worst leaders are: inspires others to high levels of effort and performance and energizes people to achieve exceptional success.
The Inspirational Leadership Model
While there is widespread agreement that new approaches are needed, and that “inspiration” is a vital ingredient, according to the 2011 HOW Report from advisory services firm LRN Corp., only 4 percent of organizations inspire their employees. It is valuable to define inspirational leadership not in terms of traditional leadership competencies, but principles that provide a broad framework to guide future behavior for the leader and the organization.
There are eight principles of inspirational leadership that a leader demonstrates that become infused into the culture. They can be divided into business and relationship clusters to reflect the fact that inspirational leadership is about both relationships and positive organizational and business results.
Rethink and reframe: Decades ago the priority was to keep the assembly line working and not make changes. Today, in the innovation economy businesses have to stay competitive, out-think the competition and fight complacency. Leaders need the courage to reframe, rethink and outmaneuver others who attempt similar actions.
Vineet Nayar, CEO of HCL Technologies, used the phrase “mirror mirror” to enable employees to see the company’s actual position in the marketplace. While HCL was doing fine according to some measures, it was mired in a comfortable mediocrity. Through many meetings, Nayar listened, led with questions — not his own answers — and recognized that not everyone would be accepting. By challenging convention and living the values he was espousing, Nayar established a new level of trust. The results have been significant. From a mid-level, regional player in IT services, HCL is now a global leader in the industry and considered to be among the best managed companies in Asia.
Pursue significance: People want to believe in what they do. It is no longer enough to go to work just for a paycheck. People want a higher calling. Younger generations, in particular, are demanding more from work and life.
The pursuit of significance, meaning and purpose is a serious focus for organizations. It is not a “nice to do” or the corporate social responsibility program of the day; it is a central mission, and one that many top leaders and companies support. Jeffrey Immelt of GE once said that “To be a great corporation today, first you have to be a good one.” Professional services firm PricewaterhouseCoopers espouses the four P’s: profit, people, principles and planet. Harvard professor Rosabeth Moss Kanter gave a name to organizations that prize purpose: vanguard companies.
“In vanguard companies, belief in the purpose and embrace of the values generate self-guidance, self-policing and peer responsibility for keeping one another aligned with the core set of principles,” Kanter said. “This type of human control system does not work perfectly by itself, but it certainly reduces the need for rules, and this helps people feel autonomous. Rather than feeling forced into conformity, employees feel that they are willful actors making their own choices based on principles they can support.”
Live, share and scale the right values: Leadership is about shaping, living and spreading the right values that drive the organization to achieve exceptional results. These values provide the spirit, soul and continuity of the enterprise. Organizations need to stand for something, not just exist for their own ends, and leaders need to help shape these values.
One of the first things that former IBM CEO Sam Palmisano did when he took the job was to enlist the company’s employees in rethinking what IBM stands for today. A collaborative tool was used to reach all employees globally, and the three values that emerged were dedication to every client’s success, innovation that matters for our company and the world, and trust and personal responsibility in all relationships. More than 140,000 employees participated in this discussion.
“It wouldn’t do to create values from the top, like [former IBM Chairman and CEO Thomas] Watson did; today people are too sophisticated, global and cynical. We want people to connect to the entity in a way that’s relevant to them. Then they have pride in the entity’s success and will do what is important to IBM,” Palmisano said.
Lead through culture: Culture is a core part of the business infrastructure that has been ignored or underestimated for decades because it was thought to be too big or amorphous to change.
Inspirational leaders understand that culture is the organization’s operating system, and it should be intentionally shaped, developed and enhanced. An organization’s culture is its enduring asset, significant beyond a single leader’s impact; and values-based cultures lead to stronger business results.
Earn and extend trust: A trusted person is open, honest and delivers results.
The conventional wisdom is that trust, like culture, just occurs and it is too soft to measure or change. However, trust can be measured, monitored, developed and improved. And it needs to be improved — according to the 2011 HOW Report, only 9 percent of employees work in high-trust organizations.
Embrace transparency: Transparency means “to shine light through,” and in business the term means decisions are accessible to all people; information is not needlessly withheld; people are honest, direct and clear about their motives; apologies are offered when mistakes are made; and information is shared with relevant stakeholders.
Transparency is a condition of modern life that cannot be denied. Google is now a verb. The sooner leaders and organizations accept the almost universal availability of information, the better. Especially as younger workers enter the workplace, transparency is an established ethic, and anything else is distrusted.
Connect with others: The inspirational leader connects with others in meaningful and unique ways. Establishing the tie between the inspirational leader and employees is important. This connection must be tangible, whether it is virtual or in person. It could be seeing former McDonald’s CEO Jim Skinner get his hamburger every day or having a meeting with Nayar while he explains HCL’s value zones. Communities form when people are connected.
Collaborate across boundaries: The next level of connectedness is collaboration. Inspirational leaders do not just connect, they work together to accomplish ends across geographic and organizational boundaries. Collaboration can take many forms, including working together on joint projects, sharing knowledge and experience, and enabling the flow of information and talent across the enterprise.
One of the toughest issues leaders face is when organizations retreat into turf wars, silos and protective behavior. Traditional rewards, governance and rules reinforce this type of dysfunctional behavior. Inspirational leaders need to pierce these mindsets and demonstrate how collaboration can lead to greater, not less success when rooted in purpose and values.
Manufacturer W.L. Gore & Associates has structured its entire company around the premise that communities always outperform bureaucracies. It has eschewed economies of scale for an economy of ideas, and work units are rarely larger than 150 to 200 people. Connection and collaboration occur almost organically when these people are linked by common purpose and principles.
These eight principles of inspirational leadership interact and build on each other. A leader who is trusted and collaborates across the enterprise is more impactful than a leader doing just one or the other. When leaders are capable and experienced in all eight principles, they become inspirational leaders who can leverage, propel and inspire the organization to greater heights in a world that is demanding new approaches to leadership and more responsible and ethical organizations.
David C. Forman is chief learning officer for the Human Capital Institute. Friso van der Oord is global head of research for the Corporate Executive Board. They can be reached at firstname.lastname@example.org.
LinkedIn members told us how leadership style affects company culture.
Michelle Cunnigham: In a competitive and innovative market, many companies and leaders adapted to cultural organizational changes. The culture of the company values and beliefs is there to focus on employees’ behavior, the way they act, interact and how they are perceived. The mission is carried out by the company leaders. It’s important for the leader to adjust the company culture to gain employee job satisfaction. By having a higher emotional intelligence, leaders can interact with staff and have an influence on their work behavior and attitude. Therefore, it enhances the staff performance to work together to meet the needs of the company to be successful.
Tessa Hilson-Greener: Leaders not being afraid to admit mistakes, openly sharing their business journey and behaving in a consistent and respectful way toward colleagues seems to be a powerful recipe for success. The expression “treating each other like human beings rather than business tools” resonates with the core values of people, a simple but successful leadership philosophy.
Paul Shola Oguntade: In every way leadership style affects company culture. The leadership’s attitude and perception toward the people automatically shows them how to behave, hence creating the culture.
If people are treated as a part of the entire jigsaw, then you get a culture of mutuality, synergy, good team spirit and superior performance. But if the people are treated as machine parts that can easily be done away with once there is a fault, then you get a culture of slavery and abuse, dishonesty, low trust and low energy.
Generally, the leadership is the yardstick, template and role model.
Sanjeev Roy: People will hear what you say but follow what you do. Leadership behavior is a key determinant of what people do or don’t do, what they celebrate and what they pass on as a message to newcomers about what needs to be done to do well in the organization. The leadership style as visible to others through behavior is a key determinant of the current culture.
Very often, homegrown leaders have imbibed many things that have been successfully imbued into an organization’s DNA through successive homegrown leaders and therefore take existing culture forward. Sometimes, particularly in times of transformational change, the leader’s style will determine the new strands in the culture.
Leanna Cruz: During constant change as we are experiencing, inspirational leaders are key to facilitating new, creative and innovative ideas needed for companies to remain relevant and successful into the future. Perhaps even autocratic leaders can inspire with behaviors essential for successful leaders of the future.
But consider what our companies would be like if we all showed up as leaders, with or without a title. If we each decided to be dedicated to adding value, managing up when appropriate and necessary and influencing in a positive way. We would each be an inspirational leader, affecting the culture of the companies we work for, no matter how small or large our current radius of influence.
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