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Leadership – Roundtable Report

18 November 2009     London
Hosted by theHRDIRECTOR.
Chaired by Jason Spiller.

DELEGATES
Jane Owen Jones, Managing Director – Lloydmasters
Ruth Spellman OBE. Chief Executive – Chartered Management
Institute (CMI), <BR>Christopher Syder, Partner and Head of Employment – Davies Arnold Cooper LLP
Ad Van der Rest, Interim HR Director – Visible Goal Ltd
Peter Morgan, Head of Human Resources – MacMillan Cancer Support
Jenny French, Group Head of Leadership Development – BT
Alan Farmer, Executive Director of Workforce – The Princess Alexandra Hospital
Christian Hasenoehrl, Partner – Gallup
John Maxted, CEO – Digby Morgan
Paul Kennedy, HR Director EMEA – NewBalance
Dr. Penny Tamkin, Programme Director Leadership – The Work Foundation
Peter Mason, Associate – Lloydmasters
David Heath, Global Director of People Capital – Alexander Mann Solutions
Alison Jenks, Integration Director HR – Tetley/Tata Beverages
Harry Dunlevy, HR Director –Independent Ltd
Ian Iceton, Director of HR Operations – Skanska UK
Craig Marsh, Research fellow, Centre for Performance HR – Lancaster University

With leadership in business in the spotlight, HR has a clear focus to provide an optimised, fully-functional leadership philosophy to meet the challenges of business today and the future. theHRDIRECTOR Leadership roundtable is focused on delivering a cohesive strategy that delivers effective and relevant leadership.

The debate focused on engaging leaders and changing the mindsets to become more transformational in approach, and less transactional. Short termism maintains a more transactional mindset, which in turn prevents the organisation from pursuing new directions, gaining competitive advantage and driving performance change. Less than 20 percent of leaders in the UK hold a formal management qualification. With the link between engaged employees, higher productivity and enhanced corporate reputations taken as read, why are so many organisations cutting corners on leadership development? What are the key measures for identifying leaders of tomorrow, and how best can they be nurtured and developed and longterm engaged to stay with the organisation, to fulfil their potential? With 52 percent of employers reporting that ‘damage to their reputation’ is a major worry, HR must take responsibility for championing the development of existing leaders and the effective preparation of tomorrow’s leaders.

Where is the profile of leaders in business organisations today?

Ruth Spellman: Fifty percent of our management membership feel that they could do a better job at the more senior levels than their current senior managers. I think that that feeling of people at the top not being in control is partly because everybody reads the papers and to be honest you would not miss that message but it’s also the way people are feeling at work.

Dave Heath: I would agree with that but I’d say there is a failure of leadership that’s been exposed in the last couple of years. Many of the leaders of our top companies today are people who’ve never led through really difficult times, they’ve been a leader through growth constantly and all of a sudden we’ve hit difficult times and they’re like rabbits in headlights.

Jane Owen Jones: There’s a huge focus on what we might badge as transactional leadership so there’s a real focus on the short term. There is a big issue about performance, there’s a big issue about numbers. There’s little engagement of people in terms of a direction.

Penny Tamkin: Fundamentally you can lay the charge at their door. Partly through the actions of very senior leaders, we ended up in the crisis and, for me, that’s about moving away from the strong sense of organisational purpose with shareholder value as one element of a much more balanced approach to business. I think we can blame leaders for some of that behaviour

Ad van der Rest: Some business leaders did not deal with the fear that if a middle-manager does something brave, their own job may be compromised because they’re being too bold or they’re rocking the boat.

Is the public face of business having to change? Is it now more about conscience and morals, rather than profit?

Penny Tampkin: CSR and green issues? There’s a miss match between espoused ethics and real life. The gap is deeply uncomfortable and what’s happened is we’ve exposed that gap.

David Heath: The speed at which many businesses dropped learning and development like a stone a year ago was staggering.

Craig Marsh: I wonder to what extent our concept of leadership is? Whether we’ve just built up unrealistic expectations, about what leaders can actually do – an inflated view of how much influence they actually have on their organisation.

Ruth Spellman: There’s not much time to put in to communicating the new strategies or the new vision and often it’s been said that strategy and vision itself is not well expressed. It’s not expressed in terminology that people always get.

Peter Mason: Leaders struggle with their strengths and weaknesses. Leadership has to recognise what it’s good at and not. They just carry on in the way that they always have done.

What can we learn from the past?

Jane Owen Jones: I’ve lived through three recessions and leadership behaviour hasn’t altered one bit. The concept of lessons learnt in the first recession has not managed to move on. I think there is something about this particular era of leadership which is is quite short term. How do we make leaders realise they’ve got a role and what their role is?

David Heath: In India, leaders of business believe they’re stewards of the organisation, custodians as opposed to just people who are out to make the next buck, and it’s a very different approach.

Alison Jenks: Is the leadership model as we know it, correct? Our expectation is that top management have all of the answers and we invest everything in that position of power I think this results in some challenges. Leaders have not felt it acceptable to talk to other leaders who lived through the last recession.

Craig Marsh: The trend is away from the heroic idea of the charismatic individual who leads from the front and yet we are asking for that kind of leadership, so I think it is a failure of our understanding of expectation.

Harry Dunlevy: I wonder if HR carries the blame? Competency models, frameworks, convincing boards that this was the way, this was how leadership had to work in this organisation. We’ve assessed people against this model who have scored ten on everything, so they’re bound to be a wonderful leader, and life is very rarely like that. We never seem to learn lessons or we do nothing practical with the findings.

Peter Morgan: The issue of ‘heroism’ is key here. It is regarded and rewarded, whereas we should be recognising and rewarding leaders for just doing a great job.

Jane Owen Jones: The most effective leaders are rarely public heroes, they move patiently, quietly and carefully. They do what is right, inconspicuously and without casualties.

People at the top have been seen as the untouchables. Should leaders sign the equivalent of an Hypocratic Oath?

Penny Tamkin: Absolutely! Heroism is long dead, although it has a seductive power. But we’re moving towards a collective people-based leadership, much more empowering. I think if we go down the autocratic route, we’ll see the same things happening again.

Do you think a committee leadership can really work?

Penny Tamkin: It’s not a committee, it’s a collective. We try and impose control on organisations by a cascade of targets. Take for example the public sector, which is almost castrated by this approach of measurement.

Craig Marsh: I think it is entirely counterproductive, the idea that what we should have collective leadership can be a very bad combination of circumstances which is not about one individual. It’s about that collective group and the way they lead the organisation.

Chris Syder: As an employment lawyer, my perspective on this is there’s been an awful lot of defensive/reactionary behaviour from leaders over the last 18 months in particular. Our Employment Group has seen the human cost of failures to effectively engage the workforce, senior management and middle management, fail to promote the vision of the business.

Jane Owen Jones: There’s no doubt about it, in the last ten years there’s more focus for leaders to be external looking because they have to actually deal with a huge array of stakeholders. Thirty years ago the focus was on work place issues. Leaders were much more careful about what they were doing and they had to come up with strategies for the organisation because they had to engage with the unions, and so on.

David Heath: We’re at a watershed in terms of the way that people communicate. The competencies that are required to get in to a leadership position in a company are different to those that were required just a few years ago. Power is shifting from a small number of people at the top, to a whole range of people throughout the business.

Peter Mason: Stakeholders are better educated and therefore the demands that they’re placing, their communication process, their speed of requirement, the demands on businesses are far greater it’s a new dynamic and it will continue.

Jenny French: I’m beginning to see a ground swell of change, people are requesting more from their leaders about how they deliver.

Do you think also the change of culture from culpability to responsibility is important? There’s been an awful lot of guarded attitude towards leadership.

Paul Kennedy: What does responsible leadership mean when we’re talking about corporate responsibility? I’m not sure putting in programmes of responsible leadership actually benefit us in any way, shape or form in the current climate.

Peter Mason: I’ve really struggled with the notion of responsible leadership. It’s suppose to be intuitive.

Ian Iceton: I joined Skanska this year. Recently we have been involved in talks about ethical leadership with the business and taking it out to the whole of our operating units, to use it as a differentiator. One example, we will no longer accept corporate hospitality, in an industry where previously a lot of corporate hospitality has been used. From a leadership point of view taking the things that are going to work for the future and relating them back to the business is really important.

Peter Mason: How does a leader need to show up in the new world. Walking, on a bike? I think we make assumptions about what our leaders of tomorrow need to look like.

Ruth Spellman: It’s simple. It’s about honesty and it’s dishonesty that really gets to people. Whether agree with you or disagree with you, I expect you to tell me the truth, whether you’re leading a big or a small company and expect me to work for you or expect me to buy your products or expect me to provide you with supplies and services.

Craig Marsh: Every utterance that leaders make to the public has to go through the PR department and is kind of washed clean of any real meaning… how can they possibly demonstrate honesty and integrity?

Chris Syder: We have a system that doesn’t encourage total honesty. There’s often a share price at the end of the day, so the message is balanced rather than honest, because leaders are very mindful of this.

Ruth Spellman: Politicians have set the tone, the majority of politicians don’t deserve the bad name they’re now getting but I believe that you can and should hold people accountable. I do believe in that. I think it’s fundamental to the whole job of management and leadership, honesty is the number one value.

John Maxted: How can we engage a fairly apathetic population in the political process and how can we make the changes at the individual levels that are going to help put this country back in the black?

Chris Syder: We live in a society that typically expects everything now, and it’s going to take time. There’s a workplace expectation that needs addressing.

So is this the new reality? A return to the old days… a job for life?

Chris Syder: I think it could be. It means engaging people to stay with companies for longer, it’s a question of talent attraction and talent retention, it’s a question of business vision and it’s a question of a philosophy of long-termism and loyalty.

David Heath: What will drive it is the changes that are going to ultimately force behaviours. I really believe the power basis shift is happening.

Jane Owen Jones: What is missing is some real true and meaningful corporate governance. Go back to the 1970s and 1980s, there was a sense of corporate governance, driven by the fact that organisations had to engage with the workforce, had to engage with unions, had to engage with people who forced them to look at themselves.

Deeply ingrained behaviours and cultures can change, providing it changes as a whole.

Craig Marsh: Our ideas of leadership come from North America. Now we’re forced to reconsider our ideas of leadership and it potentially will come from other countries and cultures.

Ad Van der Rest: A business can’t one year say “let’s cut costs” and inelegantly make people redundant (including sometimes top talent bizarrely). Then after Christmas, say “hey we’re in an upturn so let’s be engaged with people”, because the people in the business just won’t buy that duplicity.

John Maxted: The employment relationship has changed from one where there has been some commitment and responsibility, to a purely economic one. So I think the reality now is that people are paid a hell of a lot more but are treated as a commodity and you’re not going to get that longevity of employment as long as that remains.

Penny Tamkin: You can throw money at people, but you can’t buy their loyalty or their commitment.

Alan Farmer: Much of it is clarity of purpose. In the NHS it is about providing care. They are clear about what the organisation is there for. Obviously, there is criticism of management, as with any organisations and the issues are the same.

NHS leaders must be used to criticism, regardless of the economy.

Alan Farmer: That would perhaps imply that the NHS is, or has not been, as good as other sectors. I don’t agree with that. Whatever the environment you have to be clear where the levels of accountability and responsibility are within the organisation and I believe that’s there in terms of what the NHS provides.

So you’re posturing the NHS as an exemplary model for leadership?

Alan Farmer: Well I think so, quite rightly. Yes, absolutely. In developing the organisation we must be able to maintain at lot of the good things, such as our approach to governance, both clinical and corporate. Therefore, the effectiveness of how we lead our organisation is perhaps more critical to our success than ever before.

Alison Jenks: From my Indian business experience, in terms of the Tata organisation, much of our profits go to charitable Trusts. So it’s not just about making the individual richer, it’s about enriching the individual that works within that organisation.

Alan Farmer: We have to demonstrate flexibility around our leadership style as we cannot box issues. From our perspective, in terms of turning our organisation, our leadership style was very command and control. It had to be in order to unpick the issues we were facing. We can get a little hung up on talking about models all the time. I think that you must have a core around which you determine your approach.

Ad Van der Rest: Surely business leaders are those with the business acumen and political acumen. Not because a potential leader has studied for a ‘leadership 101’ exam in order to get into that position. So surely the ‘ethics of business’ will always come secondary to an individual’s political or business acumen.

Jenny French: Then we get into a debate about technical leadership versus behavioural leadership. I think a lot of organisations globally suffer from the tension, coming from the fact that a lot of people have been promoted because of their technical capability rather than their ability or desire to lead.

John Maxted: When you ask people about their aspirations they say I want to be a manager. In the 1980s, a lot of people that were accountants, were put in to general management positions and, my experience of working with accountants is, generally they’re quite risk averse. I think you must be an entrepreneur, if you’re going to be successful in business you have to take some calculated risks.

Jane Owen Jones: This is quite key to the debate about leadership, this link between functional and technical capability versus generic.

Penny Tamkin: I’m just really nervous of leaving this ethic-free world just kind of hanging there having suggested that ethics have to pay their way. I think it’s almost as if we are saying we’ll have ethics if ethics are profitable, but if ethics aren’t profitable then we’ll abandon ethics again.

Ruth Spellman: There are common leadership attributes in every sector. If you do the employable test, they do apply in all three sectors. Now the issue is, of course, how you flex the model and how you enable people to access those common core skills.

Does hope lie in young people coming into the workforce. They appear to have a greater understanding of ethics?

Ian Iceton: Younger people have been quite a driving force and barometer around some of the things you’ve talked about. Unfortunately, we will have a period for the next five years or longer where they will struggle to get into the workplace, which is a great shame..

Should leaders really take stock of their positions and obligations?

Paul Kennedy: Leaders today have forgotten how to be humble. The next generation are more understanding, more humble and will be able to bring that in to the workplace.

Ruth Spellman: Our survey showed that 90 percent of Gen Y managers say the most important motivator is to believe in the organisation that they work for.

What are the values and standards that businesses will need to instill to support emerging potential leaders of tomorrow?

Ruth Spellman: Every organisation will have slightly different ways of expressing their values but I think the first thing is to have a clear set of values in an organisation, to be clear what they are.

Ian Iceton: So what you’re suggesting is that in the past managers may have been earmarked for potential leadership based on their academic skills or their capabilities. Perhaps those are all the wrong reasons to put people in a position where they may be leaders of people?

Ruth Spellman: Well, you’re always going to need people with very super technical skills and I’m not wanting to downgrade that, but we are required to make management and leadership decisions every day.

Peter Mason: What legacy is the leader of today leaving for tomorrow? I think one of the things that we really struggle with as leaders of today is, how to cope with building the leader of tomorrow, how do we create that legacy?

Jane Owen Jones: The question is how can we do that if we can’t actually develop the leaders that we’ve got today?

Craig Marsh: One of the most effective interventions that I’ve seen HR directors do is to work precisely with the leaders of the senior team in doing some very intense one to one development work and they’re using the full suite of HR tools that we know and love in terms of process and that seems to have actually a substantial effect and added value.

Jane Owen Jones: But how does HR currently leverage that link or even are allowed to have that time with the senior leaders of the business?

Chris Syder: That’s education and an awareness of the value of HR and the value of engaging people in a business, so that the leaders who go up through the food chain when they arrive have an appropriate skill set. They’ve been educated in the soft skills before they get there, so you’re complementing and adding to a base that’s already there. For new leaders there isn’t a base level of skills so they improvise.

Wouldn’t that be a valued position for people who have retired or are near retirement,in order to fulfil that role, in terms of mentorship?

Chris Syder: I agree. It’s not just mentoring the leaders. It’s important to have mentoring at different levels of management, as they’re coming through, with regard to those soft skills; having difficult conversations for example, change management, managing people’s expectations.

Alan Farmer: There is an assumption that leaders have to be at the top of the organisation and they don’t. There are people with leadership capability and effectiveness throughout an organisation and that’s not always recognised.

Is it possible to train anyone to lead and manage?

Jane Owen Jones: Who says what constitutes good leadership skills?

Ad Van der Rest: And isn’t leadership also something very difficult to criticise people for being poor at? It’s a bit like being criticised about sex and driving.

Peter Mason: I think, often, it’s about holding up a mirror to show the impact that managers have.

Penny Tamkin: Leadership can be learnt but it can’t be taught. It requires a completely different mindset about learning leadership and what that entails and having significant others in place who have an interest in you… people that support you through that learning process is absolutely fundamental.

Jane Owen Jones: It’s understanding those unintended consequences and therefore there’s the question, do leaders really understand their role?

Paul Kennedy: It’s important that senior teams remain connected with the business. At New Balance, we manufacture training shoes, we take our senior team to the manufacturing site every quarter. As part of our leadership team meetings they go out on the site and they go and work as part of the manufacturing process.

Peter Mason: True, it’s the detail that can often make a real difference in terms of a leader’s understanding.

Paul Kennedy: And its the language that we use as leaders and the interpretation of what is said is so important. If your messages are misinterpreted at the grassroots any good intentions can be lost and wasted.

Jane Owen Jones: The apprentice model actually gets people to really understand what it’s about, how they can grow, they’ve got all the observations of how the business runs, about how different leaders work, so they can make their own choice.

Jenny French: That really resonates, the apprenticeship still lives and breathes in BT. Many of our apprentices who joined 20, 30 years ago are great examples of leaders in the organisation since they are still able to connect with what it’s like to be an engineer out in the vans.

So, it’s about removing barriers between the management and the workforce?

Craig Marsh: Recent research I’ve read on leadership is actually saying that in order to develop a leader you need the same kind of rigour and time as an apprenticeship can provide. I think a lot of the problems of leadership start at the age of 22, 23 and not at 40 when you get to the executive team. Then it becomes a process of mentorship.

Jenny French: I think there’s such value in actually shaping development solutions with the people who are going to be on the receiving end of it.

Christian Hasenoehrl: In a survey of employees Gallup compiled what consistently came back was four areas: hope, trust, compassion and stability. We then sense checked this research with a random sample of 10,000 employees from our client base and the results fell out in exactly the same areas.

Jane Owen Jones: So that suggest leaders are born, not made.

Christian Hasenoehrl: Yes, we don’t see from our research that you can actually develop in to a good leader if you don’t have any talent to be a good leader, but what we also see is that leadership talent generally develops in the late twenties. The other important areas to look at in combination with talent are skills, competencies, education, experience, etc.

Alan Farmer: Can you define what innate talent

Christian Hasenoehrl: We look at what makes the leader successful in that setting, versus what are the talents of leaders who are not successful in that setting and then we compare the differential. But what we see in our broader study is those five attributes of drive, direction, execution, influence and relationship hold true consistently.

Ad van der Rest: If those factors are so important, many leaders don’t exemplify those factors hidden in board rooms. Because there are now social networking sites, today’s leaders perhaps should be on Facebook, on LinkedIn and on Twitter, because how else are members of their workforces going to connect with what those people’s values are? Excluding the drunken photographs of course.

Christian Hasenoehrl: I think what you’re touching on is communication. You have to adjust the ways in which you communicate with the people, and make it relevant.

John Maxted: A lot more leaders are using new media and social networking to communicate both within their organisations and the broader community. Barack Obama is a great example of using new media to project his leadership at the highest level.

Jane Owen Jones: Are we talking about those innate leaders who are the charismatic type who stand there and suddenly have all this compassion, and can actually build all this trust with people, because they tend to be visionary and they tend to be very transformational. Or are we talking about in this debate people who are leaders by their very job title?

Craig Marsh: There is possibly another way of looking at leadership – what is it that leaders have to do in practice? Make decisions and solve problems. I think where the leadership part comes in, is know your limitations, recognise that you can’t use management techniques to solve everything.

John Maxted: What about the role of intuition in leadership? I think a lot of great leaders, both in business and politics, and other areas, have this capacity to use their intuition very effectively. I think we are in danger of over-intellectualising the role of a leader. I think good leaders emerge, and there’s a sense that maybe there are great leaders that haven’t come out.

Jane Owen Jones: I’m getting very nervous about this conversation. I can think of loads of schools where they make people head boy and head girl for the wrong reasons and I think the issue is, if good leaders are going to come up anyway that’s fine, we don’t have to worry about them because they’re already out there being a good role model.

John Maxted: A lot of people are supposedly in leadership positions, but actually they’re managers. The pure definition of the word leader is, you can’t have hundreds of leaders, you can have a lot of managers, but I think leadership is something very specific.

Christian Hasenoehrl: That’s where the problem starts because once they define who goes into that category, all of their efforts and support goes in to those people and the rest received very little attention, but are still held accountable for leading people.

Jane Owen Jones: But we’re still back to the question of how we develop them because, in a sense, it’s easier to say, how do we develop leaders of tomorrow because we’ve got the time. If we look at organisations at this moment in time, it’s how do we actually influence and develop the leaders we’ve got?

Chris Syder: Isn’t it about engaging with leaders today and understanding what their pressures are and supporting and educate the ones coming through, in order to help the leaders of today and tomorrow address these issues.

Peter Mason: I think it’s about simulating leadership and leader challenges and leader skills, in a whole variety of different ways, so that they can learn by being exposed to challenges and crisis and decision making.

Jane Owen Jones: There’s so much change because of the global nature of business that leadership needs flexible skills. Leaders need to understand the environmental and social trends that operate today, particularly given the wider community challenge.

Craig Marsh: Every company has its own view and model and I don’t think that’s necessarily a bad thing because somewhere in the heart of that will be some common sense about effective individuals and effective management of other people.

Jane Owen Jones: There’s a gap in development at the moment so it’s a question of… if leaders think there’s a gap in their development there’s a question of how you fill it.

Craig Marsh: Very true… look at how much leadership development goes on at CEO and executive levels?

Christian Hasenoehrl: At Standard Chartered Bank, for example, people are heavily matrixed and they look at the leadership attributes that we’ve identified, but they place much more importance on relationships or connectiveness because in their environment, in a multi-cultural environment, a matrix environment is the only way you’re going to be effective.

What is it about leadership that is divisive and also what is it about leadership that makes people either hate leaders or love leaders?

Jane Owen Jones: Bringing leadership development back to the table, is HR the enabler, the sector that is responsible for this?

Alison Jenks: HR is the enabler. I think some HR directors have a good enough relationship with their CEOs to be able to sit down and have that conversation and I think that’s the measure of the better HRDs. It’s about the leadership team and its inter-relationships.

Paul Kennedy: In the role of HRD you’ve got to be a great leader yourself and be able to display those attributes and have the charisma and the connection with the board and you’ve got to have their trust. You have to have that influence, that gravitas.

Dave Heath: Most leaders that I’ve met at the top level in most companies actually do want to learn and do want to develop. Sometimes, they’re a little afraid to say so. I think the role of HR is to help them do that, to assist, act as a catalyst and act as a personal mentor.

Craig Marsh: Leaders are only human, they do have feet of clay and if we raise our expectations too high there’s only going to be one thing that happens, expectation are not going to be met.

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