When Everyone Is A Leader: From Pyramids to Networks

THE MODERN LEADERSHIP DILEMMA

Business has high hopes and expectations for leadership. Managers are expected to be confident but humble, strong in themselves but open to being influenced, to have great foresight but be practical, to be bold but also prudent. In reality, how many people are there out there like that?

This pinnacle of leadership dilemma is compounded by the increased nature of disruption in modern business. Complex, fast changing environments are creating new challenges. There are simply not enough extraordinary leaders to go around.

Over the last few years we may have been developing leaders in the wrong way. Businesses have spent massive budgets trying to create high performing teams and cultures by selecting and focusing on the few. Today, even business schools acknowledge having failed to develop the right leaders for society.

In order to create strong, stable and sustainable businesses we can no longer rely on the few. Organisations must create the conditions for everyone to lead.

FROM PYRAMIDS TO NETWORKS

What does it take to dramatically enlarge the leadership capacity of an organisation? First, you have to redistribute power in a way that gives many more individuals the opportunity to lead. Second, you have to equip and energise individuals to lead even when they lack formal authority.

A Distributed Leadership (DL) perspective recognises that there are multiple leaders and that leadership activities are widely shared within and between organisations.

Unlocking leadership capabilities through the organisation means pushing decision making down. Making leadership something that people feel they are part of, committed, connected to, not encumbered by. It’s important to note that DL does not mean giving away power or control. It’s saying, as a leader how can I create conditions where people feel able to offer their expertise.

Formal leaders must provide the opportunity for informal leaders to come forward. Authority won’t be something that’s handed down from above and it won’t be something that can be captured by a title. Rather, it will be a currency you earn from your peers.

As traditional hierarchies get supplanted by these networked organisations, leadership will become less a function of “where you sit” than of “what you can do.” In a challenging environment, where customers expect lightning quick responses, decisions have to be made close to the action. And when the next disruptive threat can come from anywhere, everyone needs to feel responsible for thinking and acting like a strategist.

However, it is well worth noting the following:

Great individual leaders are still needed. High levels of DL have not meant the end of the “great man” (or woman) at the top. Even in the distributed network that develops the Linux operating system, founder Linus Torvalds maintains ultimate authority for protecting the brand and deciding on what code is included in new releases. Typically, centralised leadership also weighs in when lots of local decisions are getting in the way of economies of scope and scale, or when DL’s consensus-based decision-making is throttling time-to-market.

DL must be baked into organisational structures. Successful DL companies do not leave collaboration to the preference of individuals, but build it into structures, compensation and HR practices. At Cisco, cross-functional councils and boards were created to quickly make strategic decisions and respond to new opportunities. In addition, a significant portion of senior managers’ compensation is based upon peer ratings of how well they collaborate.

Create the right guard rails. Successful DL companies distribute the protective functions of alignment, control and risk mitigation. They bound the chaos that might result from DL by providing guiding principles. At W.L. Gore, each associate takes on the responsibility of making sure that no one “hits below the waterline” and sinks the whole ship. Another form of control and risk mitigation found in successful DL companies is the use of structures and processes to vet and select the many ideas that filter up e.g. electronic feedback, voting on new ideas & open forums for discussion.

STEPS TOWARDS ‘EVERYONE LEADS’

Old way … Permission, Department, Big units, Authoritarian style, Take control and attract followers, Command and control, Bureaucratic.

New way… Trust, Team, Small units, Coaching style, Give control and create leaders, Cultivate and coordinate, Collaborative.

Strong vision: a global purpose

Don’t give people direction about what they must do. Instead, share a narrative about what the organisation is collectively trying to achieve. Tell people what they need to achieve but don’t tell them how to achieve it. In organisations with distributed leadership there appears to be more widespread and in-depth understanding of the shared purpose and vision of the organisation.

Everyone is committed to why the organisation exists and what it seeks to deliver. The organisation’s overall strategy provides consistent parameters for action. Each person’s objectives are clearly linked to the organisation’s strategic goals, not just their local department or function.

Devolved decision making: moving authority to the customer

There are two pillars that support the idea of giving control: (i) technical competence (is it ‘safe’?), (ii) organisational clarity (is it the right thing to do). With these guiding principles businesses begin to move toward a more thinking, active, creative, proactive workforce. Authority and decision making may then increasingly be moved to where the customer is. It will feel deeply awkward as we have all been culturally programmed to work in a different way. Mistakes will be inevitable but DL will pave the way to greatness for many.

Consider introducing a policy of no objection decision making. Anyone can make any decision providing there are no valid objections within their peer group. Only key strategic decisions are to be made centrally. Local decisions are based on the best response to local circumstances within the organisation’s overall parameters.

Break big units into smaller units, thereby creating more opportunities for individuals to become full-fledged business leaders. Push down P&L responsibility and give lower level employees more decision-making autonomy. Leaders should be able to deconstruct their part of the business, to deeply understand the numbers of what drives business performance.

Values based leadership: a new type of leader

How do you pull everyone together and avoid chaos when everyone is a leader? For those in formal leadership positions the idea is to be less of an authoritarian and more of a coach, helping others to step into their leadership. As long as people have a general direction and sufficient information to lead they will form teams around a problem or opportunity. Should people start veering outside of their mandate the idea is that the community will correct it.

If you wish individuals to have a voice in your organisation, they must also have a voice in selecting and evaluating their leaders. Look into adopting a peer ranking system. All associates get the opportunity to rank members of their team, including their leaders. But this is a big step further than modern 360 appraisal. Employees are asked to create a contribution list in rank order based on who they believe is making the greatest contribution to the success of the business. This approach serves as an excellent form of “checks and balances” when it comes to who is truly recognised for their contributions as well as for overall leadership. Peer-based compensation systems can also be used to reward leadership wherever it occurs.

Collaborative achievement: behaviours & peer review

Effective leadership paves the way to shared understandings and can inspire people to create a positive work environment. So, firstly, hire based on values. Alvesson & Blom studied an IT-consulting firm, where all new hires had a week of “boot camp” with the firm’s history, myths, values, mission, vision and culture communicated by senior managers to employees. Key values like being open and treating everybody as a friend and part of the community, were expressed through leader talk, personal example and social events.

Develop a set of carefully considered set of principles around meritocracy, information and accountability that are important to building a company of natural leadership. Amazon, for example, has 14 leadership principles that are baked into their interview processes and a 3-day induction then subsequently lived and breathed by all employees. Then look at every single information process, resource-allocation process, planning process, hiring/promotion process and consider how they start to embed those principles in every one of these.

Look for opportunities to reflect, share and learn across your employee base and to view every single interaction as an opportunity to build (or undermine!) trust. Trust is perhaps the lens that we take least seriously and in the long run it’s the most important to healthy relationships, co-creation and sustainable business growth.

Learning & Development:

If DL is to work, individuals must be self-motivated. CSC Germany does this by allowing employees to work on the one of five topics that best utilizes their talents and excites their interest. This involves joining a topic community, such as one focusing on strategy and innovation. Issues are discussed in these groups until all participants come to an agreement, and leadership within the groups shifts frequently. Amar et al. calls such practices “mutualism.” It involves measuring workers not against revenue or other numerical goals, which they have observed to be ineffective as motivational tools, but against qualitative values such as trust, responsibility, and innovation.

Support the formation of informal teams and self-organising communities where ‘natural leaders’ get the chance to shine. Successful DL grows out of positive chemistry between people. You can’t predict or control the natural affinity people have for one another. Rather than “matching people up” through a formal mentoring program, companies have far more success by creating opportunities for people to mingle — and then letting them forge mentoring and networking relationships on their own.

REFLECTION

The world continues to become more disruptive and fast changing. The devices in our pockets and the increasingly interconnected world strengthens individual agency. Yet disengagement and dissatisfaction of employees in many organisations remains high. Of course, there are myriad reasons for this but I would argue that an inability to influence and low levels of ‘ownership’ contribute to these negative sentiments. DL appears to offer a logical path to responsive decision making, high performing teams and a highly engaged workforce.

A clear challenge to the successful transition to a DL way of working is the required time and resource commitment. I would argue that DL can be a success only when it is carefully coordinated and it’s important who does the coordination.

Businesses will also need to be prepared for longer decision making in a DL world. Explaining rationales, getting feedback, refining roadmaps take time but for those businesses that embrace it fully — such as W.L. Gore (who were in Fortune’s 100 Best Company to Work For ranking for 18 years in a row) — it’s a trade-off they’re willing to make in return for better employee engagement.

To shift to a DL model, it will require strong conviction from senior leaders and a willingness to make fundamental changes within their organisations. It will require re-visiting the embedded values that have been reinforced within the organisation, and the values of the current leaders. What is rewarded within the organisation? How are leaders selected? What consequences are there for leaders who don’t live up to the desired values?

From all of this I would propose that leadership has little to do with hierarchy, number of reports, age, background or even experience. Rather, leadership:

- is an individual pursuit: even the guy in the post-room is a leader.

- applies to all areas of our lives, especially those in which we do not feel very comfortable — those are the situations where there is a need to generate changes to add value.

- is about taking responsibility — both personal and social — for working with others on shared goals.

- is a muscle that everyone in an organisation should continuously develop

The traits of a 21st century leader are grounded in the qualities of passion, curiosity, compassion, daring, generosity, empathy, accountability and grit. These are the qualities that attract allies and amplify accomplishments. Only by strengthening them can we fully unleash the latent leadership talents that reside in every organisation.

Modified from a research paper, submitted as part of my MA, Digital Management, Hyper Island 2017/18. Quotation marks and references have been removed. Please reach out if these are required.