The Leaders Everywhere Challenge

Never before has leadership been so critical, and never before has it seemed in such short supply. It takes extraordinary leadership to keep an organization relevant in a world of relentless change. It takes extraordinary leadership to navigate the complexities of global supply chains, industry ecosystems, and labyrinthine regulation. And it takes extraordinary leadership to unleash the human capabilities—initiative, imagination and passion—that fuel success in the “creative economy.”

Yet for the all the effort that is put into selecting, training and assessing leaders, there still seems to be a dearth of truly top-level executive talent. Hyperkinetic change has a way of turning today’s iconic leaders into tomorrow’s bewildered bureaucrats. Tellingly, only 5 of the 30 CEOs Barron’s picked in 2008 as the world’s best showed up on a similar list in 2012.

When leaders come up short, as they often do, the problem may have less to do with them as individuals than with the top-down structures in which they operate. In most organizations, the responsibility for setting direction, developing strategy and allocating resources is highly centralized. Maybe that mattered less in a world where change was better behaved, but today, senior management’s monopoly on “strategic leadership” can rapidly turn a leader into a laggard.

Beyond these structural limits are cognitive limits. Even the most malleable minds can only attend to so much. With 25 billion gigabits of digital information getting created every day, each of us is becoming ignorant faster. Senior executives have limited time and attention. A problem or an opportunity has to be big to elbow its way into a CEO’s consciousness—and by the time it does, it’s often too late for the organization to intercept the future.

Corporate boards, headhunters and HR professionals often look at the leadership problem as identifying and developing exceptionally talented individuals who can step into critical roles.  While understandable, this elitist approach to leadership development is ultimately bound to fail—there just aren’t enough extraordinary leaders to go around.

That doesn’t mean we should lower our standards when searching for C-suite executives. It does mean we should be working a lot harder to unleash the leadership talents of everyone else. Put simply, a pyramidal organization demands too much of too few, and squanders the leadership talents of those who don’t have leadership “roles.”

In the future, a company that strives to build a leadership advantage will need more than a celebrity CEO and a corporate university that serves up tasty educational morsels to the “high potentials.” It will need an organizational model that gives everyone the chance to lead if they’re capable; and a talent development model that helps everyone to become capable.

At W.L. Gore, the innovative materials science company that is organized as a lattice rather than a hierarchy, nearly 50% of the associates describe themselves as “leaders.” What proportion of the employees in your company would see themselves that way? Probably not enough.

So what does it take to dramatically enlarge the leadership capacity of an organization?  Two things, we think: 

• First, you have to redistribute power in a way that gives many more individuals the opportunity to lead.
• Second, you have to equip and energize individuals to lead even when they lack formal authority.

These two challenges are at the heart of the Leaders Everywhere Challenge.

As traditional hierarchies get supplanted by networked, or “social,” organizations, leadership will become less a function of “where you sit,” than of “what you can do.” In a tumultuous environment, where customers expect lightening quick responses, decisions have to be made close to the action. And when the next game-changing idea or disruptive threat can come from anywhere, everyone needs to feel responsible for thinking and acting like a strategist. 

Authority won’t be something that’s handed down from above and it won’t be something that can be captured by a title. Rather, it will be a currency you earn from your peers. Leaders will be the ones who are capable of attracting followers, rather than the folks who have mastered the dark arts of political infighting and bureaucratic wrangling.

In this regard, the web has already dramatically changed expectations.  The web may appear democratic, but it’s far from flat.  Everywhere one looks there are hierarchies.  Track any discussion forum, explore the blogosphere, or roam around a social networking site and you’ll find that some individuals have more followers, more connections and more clout, than others.  Critically, though, all these hierarchies were built bottom-up.  They are “natural” hierarchies.  On the web, you accumulate influence only when you do something that is useful to others, and you hang on to your influence only as long as you keep adding value.

Having grown up on the web, the next generation of potential leaders are particularly authority-phobic.  Remember that classic New Yorker cartoon with Rover sitting in front of a computer?  The caption read, “On the Internet, no one knows you’re a dog.”  Well, on the web, no one knows you’re a senior vice president either. That’s why every leader is going to have to learn how to get things done in a world where authority is the reciprocal of followership.

What does all this mean practically?  What are some of the ways an organization might broaden its internal leadership franchise?  Several leverage points come to mind.  A company could ...

• Break big units into smaller units, thereby creating more opportunities for individuals to become full-fledged business leaders.
• Support the formation of informal teams and “self-organizing” communities where “natural leaders” get the chance to shine.
• Push down P&L responsibility and give lower level employees a lot more decision-making autonomy.
• Syndicate the work of executive leadership by opening up the strategic planning and budgeting processes to everyone in the organization.
• Use peer-based review and compensation systems to identify and reward leadership wherever it occurs.
• Systematically de-emphasize the formal hierarchy in favor of more fluid, project-based structures.
• Work to legitimize the notion of “bottom-up” leadership through communication and recognition systems.      
• Distribute the work of critical staff functions by giving associates at all levels the opportunity to help reengineer core management systems and processes.
• Hold leaders responsible for increasing the stock of “leadership capital” within their organizations through coaching and delegation.
• And perhaps most importantly, systematically train individuals in the art and science of “leading without power.” (See sidebar, below)

So now it’s up to you.  What is your organization doing to build its leadership advantage? How is it working to escape the limits of top-down power structures?  What is it doing to equip and energize individuals to exercise their leadership gifts, wherever they are in the organization?  How is it nurturing the sort of leaders others will want to follow in a post-bureaucratic world? And what are you doing to strengthen your own leadership capacity?

There are tens of thousands of management renegades in the MIX community, and around the world, who are eager for answers .   They’re hungry for real-life stories and breakthrough ideas that can help them to reinvent leadership for a new age.  So if you share our desire to build organizations where everyone has the right and the responsibility to lead, jump in.