Large scale organisations are all around us, having such a profound influence on our lives, and yet, they aren’t what we think they are. This becomes an essential problem for anyone taking on a new leadership role. What is this ‘thing’ they’re supposed to be shaping and providing direction for?
Get it right and ability to perform the role is transformed. Get it wrong and suddenly everything looks and feels difficult, obstructed, messy. Our inherited assumption is that an organisation is basically either just a physical entity (a group of facilities, offices, objects) a living organism or either just an accumulation of humans or something like a human being itself. In terms of the legal definition, for example, an organisation is a person.
‘’In reality the closest we come to the truth of an organisation is by seeing it as something akin to an artistic production, a work like a piece of music, a sculpture, literature - something that’s made by people, and has its own distinctive identity. ‘’
And just like a piece of art, it constitutes its own world. Take a short walk from one of the world’s leading financial districts in the City of London and you enter the gates of St Paul’s Cathedral. In its architecture, sculptures, the mood it creates, it’s unique and entirely entirely alien to the world of the financial district that surrounds it.
In more subtle but equally significant ways, the same applies for business organisations. They are a distinctive world. A new recruit coming into an organisation will instantly feel the differences, the immediate strangeness of the world they’ve entered: not just in terms of learning the logistics, where their desk and the meeting rooms are, but the intricacy of language used, the humour, expected behaviours.
‘’By understanding that world and that culture, and by playing an active part in building what they want that organisational world to be like, leaders are able to unlock a powerful source of high performance. ‘’
Too often senior executives will introduce changes or try and push through new developments that run counter to the basic rules and character of their organisational world, and by doing so inadvertently destroy the source of the organisation's ability to generate value.
The $36 billion Daimler-Benz/Chrysler merger in 1998 was heralded as being the perfect merger of German engineering and US commercial nous. Both were making cars and trucks, and there were all kinds of opportunities for synergies, shared developments costs and expertise. But Jack Welch saw through the surface benefits. “It’s the perfect merger,” he said, “except that it won’t work.” It was the collision of two worlds: CEOs with different visions of priorities, of the role of business in society; there were German engineers who couldn’t be told how to build better vehicles; US managers who didn’t want to be told how to manage. Shareholders began to refer to Chrysler as an “affliction” and by 2007, Daimler had to pay a capital management firm to take the US operation off its hands.
The Accelerating Leadership Power programme is how leaders are learning this new set of skills: how to build on their existing character and expertise to re-define themselves and what they do. Because running a 21st century organisation is no longer just about making the most rational decisions possible based on the rules of commercial good sense. The organisational vision and how it’s implemented need to be designed and led sympathetically - in a way that resonates with colleagues and employees across the operation and galvanises their engagement and performance.
Dr Dominik Heil, programme leader for Accelerating Leadership Power, The Praxis Centre, Cranfield School of Management