In his recently released book ‘Too Many Bosses, Too Few Leaders’, Rajeev Peshawaria taps his rich experience to reveal how bosses can unlock their leadership potential to create great companies. He should know. Starting 22 years ago as a currency trader at American Express and HSBC, he went on to join the senior leadership at Goldman Sachs, Coca-Cola and Morgan Stanley. Today, as the CEO of the ICLIF Leadership & Governance Centre in Kuala Lumpur, he is engaged in offering executive education, advisory services and executive coaching to senior industry leaders from all over the world. Excerpts from an email interview with Rajiv Tikoo of The Financial Express:
What is the motivation for most bosses to aspire to become leaders in a world where being a boss is easier and offers better returns?
The fact is, most bosses DO NOT have the motivation to become leaders. You are absolutely right about the first part of your questionthat it is easier to be a boss. In fact, being a boss is much more comfortable. Leadership involves first imagining, then working hard towards creating a better future. You have to toil tirelessly towards that better future, and there is no guarantee of success. Furthermore, leaders are usually lonely, unpopular, and often misunderstood for a long period of time before the rest of the world can catch up with their vision. The moment a leader articulates his/her vision for a better future, he/she meets resistance from every possible quarter. So for the most part, leadership is everything but glamorous. There is no surprise, therefore, that most bosses dont even attempt leadership.
So, what motivates those few that still aspire to be leaders First, they feel deeply about the inadequacies of current reality, and that makes them want to do something about it. They dont care if they succeed or not, but they cannot tolerate the continuation of status quo. Just like a parent continues to work selflessly in order to shape her child into a responsible citizen, leaders work endlessly towards their goals regardless of the final outcome. For both, the reward is in the journey itself. Second, they are very clear about their purpose and their values, and this clarity gives them the energy to keep going despite the most formidable of resistances. Each time they face a difficult situation and feel disheartened, they remind themselves of their purpose and values and re-energise themselves. Their motivation and their energy are very intrinsic.
I do not, however, agree with the second part of your questionthat being a boss offers better returns. In fact, bosses never know how much more success and satisfaction they could have achieved, had they discovered the gift of leadership. In todays complex world, no one has all the answers about how an organisation can achieve its full potential. The best leaders understand this fact extremely well and use their leadership skills to unite people towards a shared purpose. They also harness collective energy in a way that the sum of its parts is greater than the whole. A partner at a global investment bank once said to me, Everyone walks around here boasting about how much they individually contributed to the firms success, but nobody talks about how much more successful the firm could have been had they each taken 20 people with them. So for those that understand it, the returns on leadership are far greater.
Though talent development is key for survival and progress, it calls for stability and continuity at the top, which is more than often missing because the tenure of CEOs themselves is becoming shorter. So how can companies take measures, which are in their long-term interests, even if these are not in the short-term interests of CEOs?
Again, you are describing a very common problem. To begin with, boards need to do a better job of selecting CEOs. More efforts must be made to determine the intrinsic motivation of candidates. The selection committee should try to find out what is the candidates bigger purpose, and what are his deeply held values Is he a long-term value creator in it for the shortest possible haul Does he derive intrinsic satisfaction from planting seeds and seeing a venture grow, or does he rely on position power to push his own agenda. Such questions get to the heart of the candidates intentions. Once the selection committee hears the right answers, it must convince itself that the candidates claims are backed by solid evidence of past behaviour. If you do nothing else, try this: In your next interview, ask the candidate to describe his overall purpose. If at all the candidate is able to answer the question in the first place, you will get very different information about the candidate as compared to normal interview questions about skills and experience.
Once the right selection has been made, boards need to tie the CEO compensation to the companys long-term performance even if the CEO contract is only for two to three years. CEOs need to know that their decisions today will impact their future earnings even if they are not CEOs any more. Wall Street learned this lesson loud and clear in 2008 and is now making amends to its compensation practices.
How can companies help in enhancing employability of younger workforce when the business world is changing fast, but their education is not keeping pace with it?
Well, as a young person clocks more time in the workforce, her success depends more on on-the-job learning, and less on what she learned by way of formal education. So even though education may not be keeping up, companies need to invest in on-the-job learning on an ongoing basis. By this I do not mean running a large corporate university. Learning can also take place by way of project work, apprenticeship, and by making mistakes. As the business landscape becomes more and more uncertain, companies that are willing to take risks and try new things will be the ones that win in the end. This calls for a certain degree of tolerance for mistakes and failure. Nothing teaches better than failure. So companies need to take a hard look at their culture. Are employees allowed to learn from failure and move on, or are they as good as their last mistake Bosses of the latter type of company cannot hope for much innovation.
Your Brains, Bones, and Nerves (BBN) framework focuses on creating conditions to harness the energy of others rather than directly producing results. How can a company go about institutionalising the framework?
Management and boards can use the framework slightly differently. The brains of a business are its vision and strategy. The bones comprise the organisational architecture, and the nerves refer to the organisations culture. For management, it is simply a question of making a habit of focusing on these three pillars of growth on a regular basis. Until a few years ago, shaping these pillars was a periodic activity. With increasing business complexity and the forever changing landscape, management must focus on these on a regular basis. The framework provides a very simple but powerful way of keeping on top of questions like: Is our strategy still relevant, do our employees fully understand what differentiates us, and, do we have the right organisation structure and culture So more than anything else, for management it is a question of discipline. To begin with, the framework can be used as a health check, and managements can make a routine of focusing on it every quarter.
Boards on the other hand must ensure that management does indeed focus on the three pillars in a pro-active manner. Sixty-five percent of a companys stock price is made up of future value based on intangibles such as the companys ability to innovate, the quality of its leadership, and the strength of its talent. In fact, culture is one of the only remaining sources of sustainable competitive advantage today. Competition can copy or steal everything else quite easily, but they cannot replicate a winning culture overnight. By requiring management to do a periodic brains-bones-nerves BBN survey and by reviewing the results, the board can develop a good idea about how well management is focusing on intangibles to enhance future value. Board members can accordingly coach the CEO and other senior officers of the company.
Finally, what is the difference between bosses and leaders?
Here is one of several differences: A boss is someone subordinates work for because they have to, whereas a leader is someone they work for because they want to. So my question to you (the reader) is, who do your subordinates work for.
Source: The Financial Express
Published on 11 September 2011