Leadership what really matters a handbook on systemic leadership

Management for Professionals Daniel F Pinnow Leadership What Really Matters A Handbook on Systemic Leadership Daniel F Pinnow Akademie fuăr Fuăhrungskraăfte der Wirtschaft GmbH ă berlingen 88662 U Germany dpinnow@die-akademie.de ISBN 978-3-642-20246-9 e-ISBN 978-3-642-20247-6 DOI 10.1007/978-3-642-20247-6 Springer Heidelberg Dordrecht London New York Library of Congress Control Number: 2011932215 # Springer-Verlag Berlin Heidelberg 2011 This work is subject to copyright All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permission for use must always be obtained from Springer Violations are liable to prosecution under the German Copyright Law The use of general descriptive names, registered names, trademarks, etc in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use Cover design: estudio calamar, Berlin/Figueres Printed on acid-free paper Springer is part of Springer Science+Business Media (www.springer.com) Everything good has been thought before one has only to try, to think it again (Johann Wolfgang von Goethe) Foreword It is a great honor for me that my book has been translated into English as well as Chinese which makes the concept of systemic leadership accessible to an international audience Furthermore, it shows how this concept is gaining momentum internationally Although the cultural, social and historical premises are different in different regions of the world, the basic assumptions of systemic leadership concerning success and impact to be found in this book, especially in the second chapter, remain perfectly applicable all around the globe Leadership is an art of creating a world that others would love to be a part of This fundamental principle of leadership is valid worldwide I am deeply convinced that we can only shape and bear this planet if executives focus on the aspects of appraisal, trust and network establishment and put less emphasis on authority and formal powers vii Acknowledgments for the 5th Edition Executives and authors have much in common They share the loneliness of being decision-makers as well as the impact of their words in public Yet at least in one situation authors have an advantage: they receive more immediate and spontaneous feedback Authors are grateful for both positive and negative feedback, and in most cases they are also glad to receive meaningful praise As a matter of course I was very pleased about the favorable reception of the book Fuăhren Worauf es wirklich ankommt” not only in relation to the coverage in the media and the management community but also with regard to the positive feedback I received from seminar participants, readers and colleagues These very personal judgments, in combination with the awareness that a fifth edition in a short timeframe proved to be essential, are also significant indications for the success of the book The Chinese translation and publication of the existing book by the renowned publisher “China Machine Press” in May 2008 was a great honor for me The first edition sold out in just months, a clear indication of how managers value the importance of leadership in China For the translation into Chinese the publisher had no need to adjust the content or to add further explanations Although the cultural, social and historical premises are generally different in China, the basic assumptions of systemic leadership concerning success and impact to be found in this book, especially in the second chapter, remain perfectly applicable Leadership is an art of creating a world that others would love to join in This fundamental principle of leadership is valid for Europe, China and every other country and region in the world I am deeply convinced that we can only shape and bear this planet if executives focus on the aspects of appraisal, trust and network establishment and put less emphasis on authority and formal powers Enjoy your reading! ă berlingen U November 2010 Daniel F Pinnow ix 4.2 Tools as Means to an End 231 variant I have decided and you may discuss with me nothing at all whether something is to be done that something is to be done what is to be done what is to be done when, how, where and be whom it is to be done everything .when, how, where and by whom it is to be done my reasons for my decisions everything consequences that follow from this for you nothing at all Fig 4.3 How to delegate (Source: Schwarz 2005) The employee has to give up on the (uncompleted) task, even though he or she is able to complete it (reverse delegation) On the part of leaders, there is a risk that they want to everything themselves and cannot “let go.” Another difficulty might be that no true delegating takes place, because the manager constantly interferes and does not extend trust to the employee Lastly, the delegating talk might not have been through enough, as a result of which the employee does not exactly know what they are supposed to Using a delegation scale can help to assess the specific situation and the respective level of delegation (Fig 4.3) 4.2.7 Developing Teams Teamwork is popular and widespread, but it does not run itself Effective collaboration can only succeed if there is clarity on the relationship level Forming a team is never the solution to a problem, but the first step on a long road A survey of 376 executives working in teams shows where the stumbling blocks are on this journey: communication problems, an unclear definition of the task and unexpressed conflicts (see Academy Study 2002) A team’s composition is critical to its success Meredith Belbin (see Belbin 1996) distinguished between eight typical team roles that people consciously or unconsciously assume because of their personality traits and behaviors when they cooperate with others: the “plant,” the implementer, the monitor evaluator 232 More Than Just Talking or: The Instruments of Systemic Leadership (¼observer), the teamworker, the coordinator, the shaper, the resource investigator and the completer finisher In German teams, according to my observations, the monitoring, coordinating and delegating roles are represented disproportionately, while innovators who can come up with unique and creative ideas, monitor evaluators and completer finishers are far too rare It is the mixture that makes the difference, but only in very rare cases does the selection of team members follow the Belbin typology In most cases it is simply based on technical expertise, hierarchical structures, or on mere availability 4.2.8 Phases of Team Development Anyone who wants to understand teams needs to understand their dynamics Different phases of good team development can be distinguished Following the pattern “Forming – Storming – Norming – Performing,” there is first an orientation (forming) phase for the individuals who are to cooperate In this phase the participants are polite, friendly, distant, and in the truest sense of the term “socially acceptable.” They are careful and wear masks; their true selves are only partially visible The next phase of the conflict (storming) is characterized by the participants becoming impatient and beginning to challenge each other (more subconsciously than consciously) Personal animosities and antipathies become visible, and emotions are no longer hidden The participants are confronted with conflicts (see Lewin 1947) Then it comes to the stage of imposing order (norming), in which relationship conflicts are identified and resolved if possible However, “I” still overshadows “we.” But the participants try to return to working on substantive issues Roles and rules for cooperation are defined and the team gets started Only after these stages is a working group complete, and only then can the phase of integration and performance begin (performing) In this phase, even hidden conflicts are discussed openly and emotions are revealed and lived out There is feedback and confrontation, and a “we-feeling” is created In other words: if a group tries to avoid the critical “storming” phase, then it will likely never be a true team and will remain unable to integrate A word on leading teams: basically, the executive has to distinguish between task and maintenance roles, and show them depending on the situation Task roles are for example taking the initiative to define goals, proposing ways to coordinate ideas, or giving structure Maintenance roles are for example encouraging others and showing supportive behavior, handling conflicts without creating “losers,” working to involve all participants, to integrate opinions, and to allow open communication I see three fundamental success factors for teamwork: The variety of personalities: often, friendly relationships among the members is considered an ideal basis for teamwork – this is a fallacy, because a team needs 4.3 Can Good Leadership Be Measured? 233 diversity and variety not only in technical respects, but also in terms of personalities If you are alike, you cannot complement each other Clearly defining the task and setting rules: a team leader must not only set targets and deadlines, but also define the rules of the game Who will be informed when? When is what decision made and how? Good teams begin their work by defining these rules Members will need a space where they can discover that open conflicts are not deadly and that it is much better to deal with them creatively and passionately, instead of through intrigue and “underground.” Only if every team member knows that the joint effort is beneficial not only for the business but also for their own development, will they really get involved A good team leader: in many companies teams fail because they lack a leader One of the myths of management says that teamwork and leadership are opposites Effective teams need clear leadership, a person who sets the direction and the framework and who takes responsibility The task of a good team leader is to manage the moods of the group members, to control and use them, without letting go The building of teams and working groups is not a license to lead in a laissezfaire style – just the opposite is true Managers can only form a working group into a powerful team if they manage to heed these three success factors, link the task to the personal development of the team members and simultaneously create an emotional and inspirational social atmosphere “Power teams” are characterized by an open and authentic relationship, which involves considerable controversy and regular feedback Conflicts are not swept under the carpet, but are the point of departure for further improvements in the interest of finding the best solution 4.3 Can Good Leadership Be Measured? In calm seas, the ship and its outstanding engineering are praised; but when a storm develops, all eyes turn to the captain in the hopes of receiving instructions and signals Leadership is never unimportant, but in times of crisis there is a growing awareness of its importance Yet the newly awakened interest in the “leadership factor” is anything but blind worship At the same time, in recent years companies have become increasingly interested in being able to estimate the value of their own “human capital” and to measure it more accurately Management is only one of many components Initiatives such as the Human Capital Club (see www.human-capital-club.de) or approaches such as the Balanced Scorecard (Kaplan and Norton 1996) reflect this interest (Fig 4.4) Combining these two trends, the question is whether good leadership can be measured – and if so, how? Purists would say that good leadership is a prerequisite and is always measured by the results However, it is impossible to clearly link good results to a single cause So – is good leadership measurable? In closing this work, I would like to pose this question, and to answer it – within certain limits 234 More Than Just Talking or: The Instruments of Systemic Leadership ui re m m ea en su ts re s ur es re q fig go al s financially: how are we to behave towards partners in order to be financially successful? vision and strategy go al s fig ur es re qu ire m m ea en su ts re s internal business processes: in which business processes we have to be the best in order to satisfy our partners and customers? go al s fig ur es re qu ire m m ea en su ts re s customer: How are we to behave towards our customers to realize our vision s re su ire ea m es ur qu re fig go al s m en ts Learn and develop : how can we enhance our potentials for change and growth in order to realize our vision Fig 4.4 The balanced scorecard (Source: Kaplan and Norton 1996) Salary, bonuses, decisions, communication and leadership styles – suddenly all of these topics are at the center of interest, and are often criticized More and more people are wondering: what is good leadership worth? What part does leadership play in the company’s profits? What impacts can leadership have? Does leadership make a difference? In the U.S., consultants have developed a suitable calculation method: similar to the measure of success “return on investment” (ROI) there is now the measure of the “return on leadership” (ROL), which is intended to provide information on the profitability of corporate leadership How important is leadership as a business success factor really? The consulting firm Hewitt Associates divided 320 U.S firms into two groups, those with singledigit and those with double-digit growth rates It is interesting that more than 70% of the top 20 companies have in-depth policies for the selection, development and salary of executives Among the less successful companies only 38% have such an approach It is also interesting to see that all of the top 20 companies use the performance evaluation as a natural tool for career planning In companies with less economic growth, only 64% use the evaluation The “return on leadership” (development) would seem to be demonstrable Unfortunately, it has not yet gotten around to many German companies that investing in leadership requires more than just lip service The head of human resources at L’Oreal, Oliver 4.4 Conclusion: Achieving Customer Satisfaction with Leadership Tools 235 Sunday, said: “The leadership development is often very time consuming, but the effort is rewarded with young but already experienced international business management graduates.” And he seems to know what he’s talking about: L’Oreal was voted the best European employer in 2003 (see Handelsblatt, October 22, 2004) However, the ROL is too simplistic, because personnel not work according to the pattern “command received – performance – result.” Even if leadership cannot be measured, it can certainly be felt Good leaders know they can shape systems only if they understand themselves as part of those systems and their inherent powers Even outsiders can quickly see what impact a manager has on the daily routines of the employees: whether they act only on instructions or on the basis of trust and appreciation Is the fear of losing their job their motivation to work, or is it the belief that there is more than just the salary that is worth working for? Does the leader know what his or her employees need, what motivates them, and what moves them? Do the employees feel that their leader is in contact with them? An important indicator is whether both sides are not just talking about results, but also about possible and actual ways to achieve them An important factor is that all employees know which potentials make them valuable, which potentials still are waiting to be discovered, and which ones can be trained If appreciation and trust determine the climate, then mood signals will be perceived by all parties in good time before paralyzing fear and distrust can develop Precisely because these factors cannot be assessed with hard figures, but only intuitively, the measurement of success for managers begins in themselves, in their personalities, values and motivations And that is the approach of the seminars on “systemic leadership” at the Academy 4.4 Conclusion: Achieving Customer Satisfaction with Leadership Tools “A good leader has to make himself or herself superfluous.” This was the slogan a few years ago In the meantime, we know that good leadership makes a difference The return on leadership is there, although it is not easily measurable However, this should not lead managers to underestimate the issue On the contrary: its importance can hardly be emphasized enough Perhaps it will help in this regard to once again refer to the father of all management gurus: Drucker believed that the success of a company – and its leadership – cannot ultimately be measured by internal criteria, but only by the satisfaction of its customers (see Drucker 2000) And smart leaders have long-since recognized just how right he was Chapter Conclusion or: Where the Road Is Leading No future can make up for what you have missed in the present Albert Schweitzer As I have explained several times, in my opinion leadership means creating a world that others are glad to be part of I am convinced that in the future the “soft” factors of leadership will continue to grow in importance because of their immense impact on companies’ economic success If the change in the management development and leadership in companies’ everyday work is effective – we know that course corrections of large ships always take considerable time and space, so for large corporations it will be visible only after a few years – then there will be a different understanding of leadership than today And due to increasing internationalization and digitalization, Germany is experiencing a salutary push that will eliminate the last vestiges of the “imperial” tradition of leadership – towards networking, trust and emotional intelligence Essential management tools will always belong to the equipment of a good leader, and we must work to improve these tools further and to adapt them to new requirements Their application should be taught not only in theory but be based on learning by doing – much more than it is today – and should not begin (or end) at the executive level, where any mistake can have disastrous consequences for the entire organization, precluding long-term learning To this extent, I agree with Malik concerning his complaint about the lack of practical training of leaders and I place my hopes in the future But good training is not enough Choosing future managers should no longer primarily be based on their IQ but also their EQ Authenticity will be more important than a particular type of leader, and self-management and relationship management skills must become more important than a stack of business school degrees Yet the fact that “soft” factors are gaining credence does not mean a relapse into a cuddly “we all love each other” mentality When I provocatively claim that leading also means being able to love, I am talking about hard work This involves truly accepting yourself and the people around you and promoting their strengths in order to enable them to take on personal responsibility and selfD.F Pinnow, Leadership - What Really Matters, Management for Professionals, DOI 10.1007/978-3-642-20247-6_5, # Springer-Verlag Berlin Heidelberg 2011 237 238 Conclusion or: Where the Road Is Leading determination, as well as letting them go and trusting in their individual performance and intrinsic motivation to perform; further, it means exercising power as a leader, providing guidance and serving as a role model while remaining remain humble – and all of this requires courage, effort, continuous learning, self-criticism, conflict resolution skills, stamina and strength; leadership is performance And this performance will be essential in the coming years and decades, which will be characterized by fiercer global competition Many executives who have become lost in the dizzying heights of the upper echelons forget all too quickly and too readily that their performance is measured in results – not in hours worked, not in vacation days accumulated over the previous years, and not in the hectic bustle that ensues when they rush through the departments of “their” company New models will be developed as a means to measure the “return on leadership” in hard figures, making it quantifiable and calculable I doubt that these efforts will be successful, but if they serve to raise awareness among executives and shareholders, employees and managers, of the relevance and benefits of a relationship-oriented approach to leadership that truly appreciates the “human resource,” then I have nothing against the development of such models Let me conclude this book with ten central theses: The ideal manager does not exist Leadership begins with yourself Leadership is primarily self-management and relationship management Leadership is a constant learning process Leadership means loving people Leadership can be learned, but certain leadership traits are prerequisites – especially initiative and empathy Leadership requires the integration of individual needs and organizational objectives Leadership is the combination of management and guidance Leadership can – to a limited extent – be measured Leadership is an issue for our millenium References Books, Papers and Articles Bartlett, C (2003) Standpunkt: Christopher Bartlett, Campus Management Band, 1, 425–427 (Frankfurt/Main) Bartlett, C A., & Ghoshal, S (2000) Der Einzelne z€ ahlt Ein Managementmodell f€ ur das 21 Jahrhundert Hamburg: Hoffmann und Campe Baumgarten, R (1977) F€ uhrungsstile und F€ uhrungstechniken Berlin/New York: de Gruyter Belbin, M (1993) Team roles at work Oxford: Butterworth-Heinemann Belbin, M (1996) Managementteams W€ orrstadt: Erfolg und Misserfolg Bennis, W (2003) Standpunkt: Warren Bennis In Campus Management, Band 1, 199–201 (Frankfurt/Main) Bennis, W., & Nanus, B (1985, 1996) F€ uhrungskr€ afte Die vier Schl€ usselstrategien erfolgreichen F€ uhrens, New York: Campus Verlag, M€ unchen: Heyne Berglas, S (2003) F€ uhrungskr€afte-Coaching Wenn der Trainer falsche Tipps gibt Harvard Business Manager, 1(S.), 98–105 Blake, R R., & Mouton, J S (1980) Verhaltenspsychologie im Betrieb Das neue Grid Management-Konzept D€usseldorf/Wien: Econ-Verlag Boyens, F., & Gerhardt, T (2003) Mit Worten und Taten Vertrauen schaffen Harvard Business Manager, 12, 100–105 Bruch, H., & Ghoshal, S (2004) Drache und Prinzessin Wirtschaftswoche, 32, 62–65 Buckingham, M., & Coffman, C (2001) Erfolgreiche F€ uhrung gegen alle Regeln – wie Sie wertvolle Mitarbeiter gewinnen, halten und f€ ordern Frankfurt/Main: Campus Fachbuch Campus Management Band 1, Frankfurt/Main (2003a) Campus Management Band 2, Frankfurt/Main (2003b) Charan, R., Drotter, S., & Noel, J (2001) The leadership pipeline: How to build the leadershippowered company San Francisco: Jossey-Bass Clarke, B., & Crossland, R (2003) Die Kommunikationskluft €uberwinden Executive Excellence, 53, 8–9 Csikszentmihalyi, M (2004) Good business: Leadership, flow and the making of meaning London: Penguin de Vries, K Manfred: dysfunctional leadership, instead, Working Paper Series, 1–11 de Vries, K (2002) Manfred: Das Geheimnis erfolgreicher Manager: F€ uhren mit Charisma und emotionaler Intelligenz M€ unchen: Financial Times Prentice Hall de Vries, K (2004) Manfred: Chefs auf die Couch Harvard Business Manager, 4, 62–73 Doppler, K (1999) Dialektik der F€ uhrung – Opfer und T€ater D.F Pinnow, Leadership - What Really Matters, Management for Professionals, DOI 10.1007/978-3-642-20247-6, # Springer-Verlag Berlin Heidelberg 2011 239 240 References Doppler, K., & Lauterburg, C (2002) Change management: Den Unternehmenswandel gestalten Frankfurt/Main: Campus Verlag Drucker, P F (1942) Die Zukunft der Industriegesellschaft D€usseldorf: Econ Drucker, P F (1956) Die Praxis des Managements D€ usseldorf: Econ Drucker, P F (1967) Die ideale F€ uhrungskraft D€ usseldorf: Econ Drucker, P F (1984) Erfolgreiches Management in Krisenzeiten M€unchen: Heyne Drucker, P F (1999a) Die Kunst, sich selbst zu managen Harvard Business Manager, 5, 9–19 Drucker, P F (1999b) Management im 21 Jahrhundert M€unchen: Econ Drucker, P F (2000) Die Kunst des Managements M€ unchen: Econ Drucker, P F (2004) Was ist Management? 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URL: http://www.strategy-business.com ă konomie: Management und Leadership Dobiey, D., & Wargin, J J F€ uhrung in der digitalen O URL: http://www.galileobusiness.de/artikel/gp/artikelID-90 Frey, D Auf dem Weg zu Spitzenleistungen: Unternehmen als Center of Excellence URL: http://www.lmupd.de/kongress/kongressource/pdfs/frey.pdf Habbel, R W (2001) The human factor: nurturing a leadership culture In Faktor Menschlichkeit URL: http://www.strategy-business.com Kongress (2003, June 26) Leadership meets University URL: http://www.lmu-pd.de Mintzberg, H (2001) Why I hate flying, and other tales of management URL: http://www strategy-business.com Mohn, R (2000) Neue Ziele in der Welt der Arbeit In: Menschlichkeit gewinnt, S.153–196 Download-Dokument neuezieleweltderarbeit.pdf URL: http://www.competence-site.de/ personalmanagement Probst, G J B Ver€anderungen im Unternehmen: F€ uhren statt Verwalten URL: http://www knightgianella.ch/D/d-DOWNLOADS/d-PDF/d_leadership/LS-1-2000.pdf Rosenstiel, L V Change Management – Mitarbeiter f€ur Ver€anderungen motivieren URL: http://www.lmu-pd.de/kongress/kongressource/pdfs/rosenstiel.pdf R€ uegg-St€urm, J (2003, April) Kulturwandel in komplexen Organisationen pdf-Dokument Diskussionsbeitrag 49 URL: http://www.ifb.unisg.ch/ Simon, H (2001) Freiheit und Sinnstiftung: F€ uhrung im 21 Jahrhundert URL: http://www competence-site.de Sprenger, R K., & Heuser, U (2001, June 25) Online-Debatte “F€uhrung neu denken?” URL: http://www.changeX.de URL: http://www.competence-site.de/personalmanagement URL:http://www.handelsblatt.com/pshb/fn/relhbi/sfn/buildhbi/cn/GoArt!200014204614,776841/ SH/0/depot/0/ The Author Associate Professor Daniel F Pinnow, CEO of the Academy € for Leadership in Uberlingen, Germany is one of the most famous experts in leadership and management science in German speaking countries He is associate professor of leadership at the Capital University of Economics and Business in Beijing, China and lecturer for leadership and human resource management at the Technical University of Munich As a pioneer in systemic leadership in Germany, Pinnow combines his extensive leading and managing experiences with traditional management theories, organizational psychology and family therapy Pinnow earned a master’s degree in economic sciences from the University of Cologne and a master’s degree in social sciences Throughout his studies he focused on psychology and organizational sciences The experienced management trainer and leadership coach has been on the board of directors of the Cognos AG, one of Germany’s biggest private providers for further education and gained deep leadership experience as top manager within international companies such as EADS and E.ON Ruhrgas AG In addition to his bestseller ‘Leadership – What really matters’ (F€uhren – Worauf es wirklich ankommt, 5th edition in 2011), which was additionally published in China as one of the first German management books, Pinnow has been publishing numerous papers and books on leadership, human resource management, and ethics Daniel F Pinnow lives in the region of Lake Constance, Germany He can be reached through the Academy for Leadership www.die-akademie.de and through his personal Web site www.daniel-pinnow.de 245 ... leader? What leadership approaches are important and what is negligible? What you need for your everyday management? What is new and yet already outdated, or already old but still of real value... substantial and rapid changes that many managers have practically had to relearn their occupation There is hardly anything familiar that they can hold on to, and so they see the hierarchy disappearing... basic conditions for leadership are no longer traditional, reliable constants Leadership personnel are confronted with processes of change in two ways: on the one hand they must adapt to changes