Leadership by Leading or Leadership by Formal Power:Making Long-Term Strategic Decisions

Leadership is an absolute and vital aspect of business success. Without the right type of leadership there will be a lack of motivation, commitment, and sustaining power in organizations. If your company has low morale and people are griping you might need to take a look at who and how leaders are selected. It may be a problem with personality and management style.

Consider a scenario of two leaders....

Leader 1: One leader has the an open personality and tries to understand before judging. He/she has confidence in their abilities and looks at issues from multiple angles before making a judgement. They rely on their own experience and the experience of others to make decisions. Because they have an even keel personality and are fair to others they have gained trust and respect.

Leader 2: Relies heavily on formal power. He/she is competent in their job  but unable to deal effectively with other people. Their agenda must succeed at all costs and anyone who has another idea is seen as a threat to their position. They encourage rumor mongering, get vindictive with promotions, and make decisions based on the bundle of dysfunctional needs they carry.

Companies make this mistake all the time. They skip over Leader 1 to get the quick results the "whipping of the horse" Leader 2 offers. They ignore the long term needs of the organization and the employees in an effort to quickly solve problems and means loss of human/intellectual capital.

When the organization finally figures out the mistake and in turn opt for Leader 1 they have already done a lot of damage. People have left, resentment bubbles, the rules of performance have changed, and a culture of distrust takes hold. It requires much more effort to fix the problem then it would have if the proper decisions were made right away.

Selecting the right type of leader who is a fully developed person is important for overall growth and development of the entire organization/organism (The organism and organizational structure often develop together). The personality and performance of the entire organization rests on the personality and performance cues brought forth by leadership. Poor leaders foster poor employee behavior while strong leaders enhance employee behavior.

Lessons:

-Think about personality and integrity when hiring for senior leadership positions.
-Ensure the person thinks about their role beyond themselves.
-Hire leaders who have ethical approaches and understand the benefits of fair processes for selection and promotions.
-Make sure the person has an even keel personality.
-Ensure they have right type of background and can make appropriate long-term strategic choices.