One of the most frequently asked questions I get is: What should we do to improve and develop our leadership? I think one reason I hear this question so often is that we don't handle leadership properly. We all know that leadership affects other people. It therefore puzzles me that we allow leadership skills to go undeveloped and unimproved.
We know that Nordic leadership isn't good enough from the results of Ennova's GELx survey. Our leaders are given very poor ratings by the employees they lead. In Sweden, a whopping 40% of employees think they have a bad boss! I meet with customers all the time who talk about the need for leadership training, and as our own surveys also show that we actually have poor leadership skills in Scandinavia, it makes me wonder why...
A world in flux
One critical aspect in this context is the changes we are continuously having to deal with. Our workplaces and organizations are in a constant state of flux. This increases the need for dialog, communication and leadership that is more involved.
The world is full of all kinds of leadership theories. Most of the ones I've read contain something useful, but they also comprise elements that can't be applied. Then I read Bass and Burns' thoughts on "transactional" and "transformational" leadership.
Our future leaders need to be less transactional and more transformational in how they work. When viewed from the perspective of constant change, transformational leadership becomes even more important.
The actions of a transactional leader tend to come from the perspective of explaining what is needed. What is needed of you as an employee? And what happens if and when you - the employee - fulfill this need?
This is primarily a resource management and organizational type of leadership - that is, more management than leadership. A promise of a "reward" if something is done well and "discipline" if something is not done well.
The transactional leader
Some of you may have been in a situation where senior management decided to cut costs by skipping the annual Christmas present or cancelling the office Christmas party. It's pretty common to make changes to benefits (a promised reward) when we set out to cut costs within our organizations. The problem with this approach, however, is that we end up breaking our promises. In the transactional spirit, we've said to employees: "You work 40 hours a week, this is your job and your responsibility, and we expect this of you. In return, you receive this salary, a set number of vacation days, a gym membership, a Christmas present, an annual Christmas party, etc."
So when we skip the Christmas present and the office party, we are breaking the promise we made. The entire transactional concept is based on you doing something in exchange for getting something in return.
This is, of course, a simplified example, but it demonstrates the tenets of transactional thinking. A structural behavior that is still actively employed in almost every company in the country. This is an ingrained behavior, and it can't be changed without help.
Transactional leadership is particularly inferior when it is passive as well. Something which we often see in Scandinavian leadership. We work in relatively "flat" organizations, where the employees have a great deal of responsibility and where they are expected to do their work without the involvement of their superior.
In Sweden, 50% of managers spend less than 25% of their time on leadership. This figure may be a reflection of the notion that "if it's not broken, don't fix it". However, a comparison with the level of employee satisfaction with their managers begs the question: Isn't it broken? We need to ask ourselves whether transactional leadership is really what we want?
Transformational leadership is based on the manager getting involved with their employees. It is a matter of creating both acceptance of and goodwill towards our vision and goals, and of being viewed as charismatic and contributing with intellectual and cognitive stimulation within our focus areas.
Swedish leaders are often very talented specialists within the area where they are managers. The challenge is to inspire, communicate and build a common desire to exceed goals and expectations. We need to be more charismatic, committed and involved. We need to create greater understanding and a sense of community!
A transformational leader who needs to cut costs, for example by skipping the Christmas present or office party, starts with a dialog on the current situation. He creates a shared understanding of the company's challenge among his employees. With this as a jumping off point, the manager can then ask employees to come up with cost-cutting suggestions to make them an active part of the solution.
If you involve your employees in the company's situation and support the dialog by breaking down the various elements and then invite input on what each employee and the team as a whole can do, it will almost always be possible to reach a vision and a goal that is better than what you came up with at the last senior staff meeting.
However, this leadership method requires more from the individual manager. It requires a change in behavior, more time and courage from the entire organization. It also requires a competence boost to help leaders become more transformational.
Good leadership will lead to higher satisfaction in the workplace, which will lead to increased productivity and creativity, which will in turn lead to a greater sense of courage and responsibility. It will create more loyal customers and generate higher profits, which can ultimately result in lower absence rates and fewer health issues.
But first, we need to realize that our leadership has become stuck in a rut. To achieve such enormous rewards requires the courage to make changes. We need the leadership of the future now.
What type of leadership do you and your company want in the future?