The leadership illusion

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What would you say about a global industry worth $45bn annually that was delivering no apparent value? An industry which has grown by 39 percent in the United States in the last five years. One that attracts ever more investment even as its returns are seen to diminish. You might conclude that it was a failure, and an impressive one at that.

This is the leadership industry, a complex that now encompasses colleges, gurus, corporate departments, startups, foundations, consultancies, publishers, think tanks, half a library, a forest of blogs and a never-ending series of workshops. You probably have a training session devoted to this topic somewhere on your calendar.

Angry followers

Meanwhile, confidence in business leaders plumbs new depths. More than one-third of Americans polled by Parade Magazine told them that they would forego a pay rise if they could see either their boss or their immediate supervisor fired. Fewer than half the respondents to a major survey conducted by the PR firm Edelman said they trusted CEOs. In Britain, a government-sponsored report on business leadership concluded that ineffective management was costing $25bn in lost working hours.

A McKinsey survey of 500 executives found that two-thirds of them rated leadership development as their number one concern. The World Economic Forum recently polled nearly 1,700 of its experts and found that 86 percent of them saw the world as facing a “leadership crisis”.

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It would be fair at this point to ask whether this pessimism is in itself anything new?

“The crisis of leadership today is the mediocrity and irresponsibility of so many of the men and women in power. The fundamental crisis underlying mediocrity is intellectual. If we know all too much about our leaders, we know too little about leadership.”

This was the conclusion of the American historian James Macgregor Burns back in 1978. “Leadership,” he wrote, “is one of the most observed and least understood phenomena on earth.”

Innate versus Process

Much of earlier thinking on leadership assumed that it was innate — the leader as hero or messiah. In recent decades though, the “trait model” of leadership has been chipped away at. Instead of traits, leadership we’re now told is a set of actions and these actions can be studied. According to this “process model”, being a leader is not someone you are it’s something you do.

The leadership industrial complex is predicated on the idea that leadership can be learned. So it would be reasonable to ask why it’s being so badly taught. This was a question that obsessed Joseph C. Rost, a professor of leadership studies at the University of San Diego, who in the early 1990s set himself the dreary task of reading the entirety of leadership literature going back to the beginning of the 20th Century.

He found that the steady trickle of books, chapters of books and scholarly articles became a flood in the 1980s. The bottom line in almost all cases was nothing more than the revelation that leadership was good management, which in any case is disputable. All of them had one thing in common, he found. They would open with the disclaimer that leadership scholars have no clear understanding of what leadership is. “The problem with that statement is not that it’s inaccurate,” Rost wrote, “but that having made it, 95 percent of the scholars ignore it and write their book, chapter or article as if they know what leadership is.”

Barbara Kellerman, a founding executive director of the Harvard Kennedy School’s Center for Public Leadership, is one of the people who should know. But she admits she doesn’t and that leadership studies seems no closer to finding out. Kellerman says there are roughly 1,400 different definitions of the words leader and leadership. A protege of the historian Burns, she has emerged as one of the most thoughtful critics of the leadership industry.

The end of leadership

In her 2012 book “The End of Leadership” she found that while thinking about leadership was as old as human history, there had been an explosion of interest in leadership since 1980. People started to believe for the first time that leadership could be taught to large numbers of people simultaneously. And along with it came a growth industry of thousands of so-called experts whose performance has been “less than wonderful”.

“As a whole the leadership industry is self satisfied, self perpetuating and poorly policed,” she argues. “Leadership programs tend to proliferate without objective assessment; leadership as an area of intellectual inquiry remains thin; and little original thought has been given to what leader learning in the second decade at the 21st century should look like.”

Much of the literature that Kellerman politely disdains is essentially self help material for the C-suite which does little more than collect feel-good stories and anecdotes. Leadership writing often reads more like biography than instruction. The process model exhorts leaders and “emergent leaders” — those unrecognized leaders in the workplace, often women — to show modesty, honesty and empathy.

Too often interesting ideas, like “What You Really Need to Lead: The Power of Thinking and Acting Like an Owner” by Robert Kaplan get bogged down in defending the assertion that leadership can be taught at all. What starts out as a paean to authenticity in leaders turns into a nervous defense of the global industry of which the writer from Harvard Business School is part. It ignores the fact that most of us view leadership more like music, where being naturally gifted is a huge head start but everyone else can at least learn some form of practice or appreciation.

Some of the more original thought that has been given to the subject has come from the great rival of the Harvard Business School on the west coast, the Stanford Graduate School of Business, where the business theorist Jeffrey Pfeffer works. His bluntly titled “Leadership BS” finds that much of what constitutes leadership development is a warm sermon on authenticity, when the reality is more hard-hearted and complex, like the leaders we mythologize.

Wishful thinking

The leadership industry has failed, Pfeffer argues. There is little or no evidence that its recommendations have had a measurable impact. This is due in large part to its reliance on wishful thinking alongside our desire to mythologize leaders and reluctance to look at the reasons they were effective.

“There’s all this mythologizing that besets leadership, as people try to generalize and learn from exceptional cases,” he writes. “But that has resulted in this enormous disconnect between what actually makes individuals successful and what we think makes them successful.”

Great leaders, he points out, have often been marked as much by egoism as the desire to do good. It’s hard to argue that honesty and modesty are hallmarks of effective leader when its most prominent exemplar, Steve Jobs, was so convinced of his own ideas that colleagues talked of a “reality distortion field” around him.

Worse than this, the idea that the leadership problem can be tackled by encouraging good behavior can actually make things worse, says Pfeffer. When the expectation of the virtuous leader crashes into the reality of the complex demands of business it is a recipe for the kind of acid disillusion that appears in the surveys above.

As a culture, we’re fascinated by the legends like Richard Branson, Steve Jobs, and Mark Zuckerberg, but they are basically just stories, says Pfeffer.

The prospects for a gradual improvement of business leadership rely on more mundane practice like improving the quality of boards of directors — this has seen the annual rate at which CEOs get sacked fall to a historic low in 2015. Learning how to incentivize employees correctly and improving corporate culture are more important than exhilarating lists of aspirations.

In the meantime, the leadership industry will keep growing and giving people what they want, says Pfeffer. “We want nice stories, so that’s what we get.”

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