How the role of a leader is changing

How the role of a leader is changing

What should a manager, entrepreneur, and leader managing a company be like, so that employees can arrive at work and leave work with a smile, be dedicated, and feel their mission? Leading successfully is not a matter of a pinch of inspiration, charisma, and persistence. It is difficult to work that demands more and more from leaders every day.

Satya Nadella assumed the role of the Chief Executive Officer of Microsoft in 2014. This is when the price of the shares of this gigantic company slowed down, mobile technology began exceeding the impact of conventional computers, and Apple and Google were taking over. Microsoft was at risk of losing its powerful position, built up over the past three decades. By taking this role, which was one of the least desired at the time, Nadella decided to do two things: to focus on mobile and cloud solutions from a technological perspective and to change the management culture and, as a result, the organizational culture from a leadership perspective.

Sticking with leadership – what did he do? Microsoft’s new mission has become to “empower every person and every organization on the planet to achieve more.” By making this the new mission, Nadella trusted in a new model for culture and leadership, and new work methods that not only enable performance but also encourage innovation and flexibility. There is an intentionally greater emphasis on empathy, empowering individuals, positivity, and the growth mindset. Microsoft also adopted its work methods and cooperation performance became one of the criteria for rewarding employees.

Leadership in the business world – is management truly in decline?

In recent years, the opinions of various segments of the public are often conflicting regarding the question of whether we still need managers, or just leaders, or both. The constant emphasizing of soft skills as crucial for successful leadership (charisma, empathy, some also include love) often places into the background the basic mission of every person in top positions – to ensure the successful operation of the company with high added value, productivity, and profitability, and generate new jobs. What does this mean?

In 2016, the Harvard Business Review quoted the findings of the author and researcher John O’Leary, who was once one of the editors at the Harvard Kennedy School. He conducted in-depth interviews with successful individuals in the highest positions in order to present the differences between managers and leaders. According to him, managers do things right and leaders do the right thing. Management should be about administration and something that must be done, while leadership should be about innovation or something that we want to do.

Interviewees often mentioned that the behavior of a leader should have positive psychological effects on their followers, focus on their dedication, and motivate and empower them. On the other hand, management is connected to the behavior that strives for the successful achievement of results and efficient performance. In short, these interviews showed that, in theory, we think of managers having a different focus from leaders. However, it was also shown that these differences are blurred in practice. Most of these activities are very similar or even the same – to delegate, teach, and motivate. Leadership and management are not that different in practice, the main difference is the focus: more on the person or more on the results. According to the book titled What Leaders Really Do by John P. Kotter, also a Harvard professor and an authority in the field of leadership and change: “Leadership and management are two distinctive and complementary systems of action. Both are required for success in an increasingly complex and unstable business environment.” Without focusing on people, companies today will not have long-term success. The best personnel in a company might not initially leave, but companies will be abandoned by buyers who pay increasingly greater attention to the ethics of a company, its focus on sustainability, and giving back to the environment in which the company operates

Leadership without stereotyping

All these companies in the world exist because people seek new and unique experiences. Diversity is also the thing that makes our world beautiful. Diversity also has its purpose in nature. For example, in nature, biodiversity is key for the functioning of our planet. A study conducted by the Boston Consulting Group (BCG) last year showed that an increase in the diversity of management groups leads to greater and better innovations and the improvement of financial performance. The study included 1700 different companies from eight different countries and various industries. Income in companies that have more diverse management teams is 19% higher due to innovations. Diversity is not just metric that companies need to strive for, but an integral part of a successful company. Diversity is the diversity of thought, ideas, and approaches that enables teams to find a solution that takes into account multiple perspectives, whereby a solution is more powerful, more insightful, and optimized.

The head, heart, and hands of transformation

It is difficult to claim nowadays that we can still find a company that does not require a transformation. Changes must happen through a transformation in multiple parallel areas at the same time. According to Jim Hemerling, the CEO and senior partner at the Boston Consulting Group in San Francisco, who is one of the people helping international leaders to manage changes or transformations, the constant efforts to achieve something faster, better, new, and different is no longer like a marathon for leaders and employees, but a triathlon. You can cycle very quickly, but unless you are also a good swimmer, it is to no avail. You still get exhausted.

The fact is that changes used to happen every once in a while, mostly in connection with crises, but today we are in a new period of continuous transformations that have become a constant. Transformation is a difficult process that often fails or does not meet expectations. Nonetheless, many organizations overcome obstacles and some even manage to achieve permanent results. In Jim Hemerling’s opinion, leadership plays a central role in this. There is no one-size-fits-all method, but he introduced an approach that combines three interconnected elements. It includes broad and creative thinking about the future for which the company strives and the focus on the right strategic advantages in order to achieve this future. It deals with constant, ever-changing, and increasing requirements from employees, but in a way that inspires them, gives them a sense of meaning, and trains them at all levels of the organization, so that they do not lose will and energy. In these times of rapid changes, leaders must be aware that it is not enough to only innovate and then implement, but innovations are now implemented during the implementation of the previous innovations. Both need to be done diligently. He summarized leadership with constant changes or transformation into three parts: the head, the hands, and the heart. Our head is the reason that determines the direction of change. The hands ensure implementation and ambitious innovations. The heart is in charge of human relationships, motivating people, and training them for adopting new transformation tools.

Therefore, a comprehensive approach focusing on people is necessary for leadership in the new digital age.

Sasha Mrak Hendrickson, VP of Sales & Marketing, Carver Institute
The article is modified and was originally published in HR&M magazine in 2019.