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Leadership When Hierarchy Fails

Collapsing Hierarchy
Two seemingly unrelated stories have struck me over the past month: the continuing saga of the Harvey Weinstein sex abuse scandal and the publication of the report into the Grenfell Fire commissioned by Muslim Aid. For me, the thread connecting them is the threat and the opportunity posed to hierarchies in an increasingly complex and networked world.

According to Margaret Heffernen, a leading analyst of the sexual abuse scandal, the power of hierarchy kept the lid on sexual harassment, through confidentiality agreements, firing people, or ruining their reputations if they spoke out. In her opinion, when the lid came off it marked a fascinating moment in organisational history: the moment “when hierarchies fail.” And the cause of this failure, she believes, was networks. #MeToo spread through networks. It didn’t need permission or approval, it grew very fast and it was beyond anyone’s control.

The public inquiry into the Grenfell Fire is yet to conclude, but the report commissioned by Muslim Aid appears to confirm what many said at the time: voluntary organisations had to fill the void left by a lack of official direction and weak leadership by the local council. But the report also recognised that, in certain respects, the voluntary sector “came up short, with some systems, structures and approaches not fit for purpose”.

Coordinated action does not happen without leadership. Direction, however gentle or subtle is always required. But in a networked world leaders will not hold all the levers of power and will increasingly be asked to lead without formal/positional authority, across internal and external organisational boundaries. In which case, where does authority as a leader come from?

In his recent book, The Square and the Tower, Niall Ferguson identified a similar historical narrative, in which major changes, dating back to the Age of Discovery and the Reformation, could be understood as disruptive challenges posed to established hierarchies by networks. He also challenged the confident assumption that there is something inherently benign in network disruption of hierarchical order. In his view, networks are more likely to lead to an anarchic dystopia rather a collective utopia, so some form of hierarchy/structure is required to control and direct them. The frightening thing for hierarchies, however, is that networks like seem impossible to control and are not going away.

The secret of our success as a species resides in our ‘distributed cognition’ the collective brains of our communities. Ferguson suggests that our species should be known as Homo dictyous (network man), because our brains seem to have been built for networks. Our early ancestors were collaborative foragers and all that has happened, beginning with the invention of written language, is that new technologies have continued to facilitate our innate, ancient urge to network.

In trying to understand the inspirational community response to the Grenfell Fire residents spoke of how tight-knit their community was and how many different nationalities lived in the tower. Some suggested that the response may have its roots in the preparation each year for the Notting Hill carnival. Whatever its origins the power of networks was certainly apparent, both the physical connectivity of friends and neighbours, and the power of social media, to mobilise action. What was missing was anyone to lead and coordinate the relief effort, in other words a network leader. While a great deal was achieved, in the absence of network leadership, much time, effort and resources was wasted and misdirected.

It is perhaps not surprising therefore, that for most of recorded history hierarchies have dominated networks. The word hierarchy derives from ancient Greek, meaning ‘rule of a high priest’ and was first used to describe the heavenly orders of angels. The attraction of hierarchical order was that it made the exercise of power more efficient, centralising control and eliminating, or at least reducing, the need for time-consuming arguments about what to do, which might also degenerate into conflict.

Hierarchy however, and the bureaucracy it inevitably generates, is unsuited to complexity. On the one hand, as the physicist Yaneer Bar-Yam has argued, a group of individuals whose collective behaviour is controlled by a single individual cannot behave in a more complex way than the individual who is exercising control. On the other hand, complexity and bureaucracy are diametrically opposed. The essence of complexity is its unpredictability, while the essence of bureaucracy is its quest for calculability and safety, which too often means it becomes a prisoner of events that were not predicted.

So, if complexity is beyond the wit of a single individual and bureaucracy is procedurally unsuited, a new approach to leadership is required: one that mirrors the interactions and mechanisms of the network and derives its authority from something other than hierarchical position. Perhaps the true test of leadership, dating back to our early ancestors, is not how grand your title, but how far people are prepared to trust you, to be open and honest with you, and to challenge you.

Left to their own devices networks develop naturally through our search for knowledge and belonging. So network leadership begins by helping people make sense of their situation and clarify their goals. Clarification starts when someone steps forward and makes suggestions about how to fix or achieve something. Naturally, again, we tend to associate with and listen to people we trust, those who have earned our respect through their integrity, generosity and reciprocity. And let’s face it, leaders are going to have to be more trustworthy whether they like it or not, because networks (#MeToo) force greater transparency and openness.

Openness is also key for the process of clarification, because it depends on continually refining what our goals mean in practice through facilitated discussion and working through disagreements. Leaders must recognize and embrace the “obligation to dissent”, encouraging those around them to speak their minds, to bring attention to hypocrisy and misbehaviour, but also to poor ideas and plans.

Humility and integrity are a powerful combination in a networked world. Life is not always a competition and perhaps we should all care more for getting the job done than who gets the credit. Ultimately, in a world without hierarchy anyone can acquire the authority to be a leader.

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Three Simple Questions to Breakdown Organisational Silos

open-and-closed-signs

One of the hottest political issues is how ‘open versus closed’ has transcended ‘left versus right’ as the key political division. Those who are ‘open’, so the argument goes, are in favour of immigration and free trade, and those who are ‘closed’ are in favour of tighter border controls and protection for domestic industries. Alternatively, they are described as citizens of somewhere (closed), rooted in nations and local communities, or citizens of nowhere (open), happy and able to live and work anywhere. Leaving aside the value laden descriptors both have value and these are fundamentally aspects of tribal identity.

Human and related species are guided by tribal instincts, which are essentially about survival: ‘families’ uniting with other ‘families’ for protection and to share the burden of providing food and shelter, but for humans the instinct doesn’t stop there. Among our primate cousins and our early ancestors, tribes did not grow much beyond a couple of hundred individuals in a shared physical space. Our species, however, underwent a cognitive revolution that enabled us to share intersubjective realities: the ability to share ideas, such as religions and political ideologies, that overcome the limitations of face to face contact and created ‘tribes’ consisting of thousands and ultimately millions of people spanning the globe.

But in both its primitive and more evolved version the downside of the tribal instinct is tribalism, when the behaviours and attitudes that stem from strong loyalty to one’s own tribe lead to the exaltation of the tribe above other tribes. At the very least this may mean we ignore their ideas and at an extreme can lead to racism, nationalism and ultimately genocide.

The same dynamics apply in organisations (though hopefully not to such an apocalyptic extent) and the same balance therefore needs to be struck between open and closed: the productivity of closely bonded teams and the openness to seek out new ideas from other groups. The question is how to do both? How to address the paradox of being both ‘closed’ and ‘open’, and therefore to be both efficient (doing things right) and effective (doing the right things).

In the first place, the distinction between ‘closed’ and ‘open’ can be examined using the concepts of bonding and bridging social capital. Social capital is the benefit accruing from the networks of relationships within which we live and work, with bonding social capital referring to the reduced transactional costs marked by reciprocity, trust, and cooperation in highly productive teams and organisations, and bridging social capital referring to the opportunities provided by new sources of information, perspectives, and innovation from outside the organisation or team.

Traditionally, organisations have tried to increase productivity by focusing on bonding social capital, building levels of trust through team working and identifying efficiency savings through techniques such as ‘lean’. The problem is that such approaches tend to be conducted within the constraints of hierarchical silos and savings become a zero sum game between the different departments and directorates fighting over reduced resources and thus working against any notion of cooperation, let alone collaboration.

An alternative approach is available however, borne of our greater understanding of social networks (the informal lateral and diagonal relationships that challenge our more formal understanding of organisations, epitomised by the hierarchical org chart). Focusing on networks helps us to understand the current state of connectivity and co-creation within and between sub-organisational tribes, identify where the gaps are, and then begin to bridge them.

The key is to scale up the attributes of high performing teams so that they extend across the organisation, binding the whole organisation together around a shared intersubjective reality. A shared understanding of the context, leading to the creation of a shared purpose and ultimately a sense of mutual accountability, which each department and team can then translate into its own objectives and priorities, which all link back to the shared purpose.

Great, so where do you begin: everywhere. Of course the organisation needs a guiding hand from the top to define the shared purpose and adopt a more networked approach, but if change is to happen, ultimately it has to happen at the top, the bottom, and the middle. Individual behaviour has to change in order to drive broader organisational change.

So how do we get people to change their behaviour: to value both closed and open, to focus on working with and through others rather than approaching tasks entirely through the narrow lens of my team, my department, my tribe. The simple answer is to change their targets. Imagine if, as part of their appraisal, everyone in the organisation had to provide evidence in support of the following three questions:

1. Give me an example of when you have successfully collaborated with an individual from another team or department to complete a shared objective.
2. Give me an example of an idea from outside your team or department that has improved the way you work.
3. Give me an example of when you shared your learning with those from another team or department.

As the Chinese proverb suggests: if you tell them, they’ll probably forget; if you educate and train them they might remember; but if you involve them they’ll not only understand, they’re also likely to do it.

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Networks: How to Achieve More with Less

Asset-Mapping

Let’s be clear, we are not talking here about networking for personal ends, collecting business cards, followers on social media, or belonging to a nepotistic old boy’s network of mutual back scratching. Sadly, the President’s Club is an example of networks gone badly wrong, where abhorrent behaviour, driven by the worst aspects of human social psychology, outweighed the social mores of wider society.

What is worth noting however, is that men tend to network to get things done, while women generally network to learn. Both are necessary but neither is sufficient. At its worst, networking focused on doing leads to ill thought through actions that are needlessly repeated, while networking focused on learning becomes therapeutic rather than dynamic.

We live in a networked world in which wicked problems, from global warming to terrorism and inequality, flow through interlocking webs of connection, causing volatility, uncertainty, complexity and ambiguity. Conversely, in science, technology, the environment and society, networks are becoming the paradigm with which to uncover the hidden architecture of complexity and the capacity for people, resources, and ideas to generate greater collective value. Fundamentally, networks provide a new lens through which to view organisations and communities, and a new language to help explain and act within them.

The term ‘wicked problems’ was originally coined in the 1970s to describe problems of social policy that did not lend themselves to solutions through a purely scientific-engineering approach, because they were characterised by incomplete or contradictory information, large numbers of people and divergent opinions, and the interconnected nature of these problems with other problems. It has since been applied to problems from pandemics and climate change to social inequality and business strategy.

In most organisations the conventional response to ‘wicked problems’ has been to sweat your assets; to demand that more and more be done with less and less. Yet however imaginative, there comes a point when there is no more money, your people are mentally exhausted and physical resources can be squeezed no further. The alternative is to recognise that nothing happens without networks. We exist within them and we work through them, but often without necessarily realising that we do.

The challenge of wicked problems is exacerbated in many organisations by the assumption that every problem fits neatly into one of the departments into which they have organised themselves: and no amount of structural readjustment will solve this. However construed, organisational silos and bureaucracies drive narrow departmental approaches to problems rather than create whole organisation solutions. By making networks explicit we can see that problems and risks are rarely confined to one department or directorate, and that the solution is to do less ourselves and more with and through others, by identifying synergies and avoiding duplication of effort.

The problem is perhaps most acute for public services and the voluntary sector, where success is often dependent on support and harmonisation with other organisations. To be effective, organisational efficiency must be complemented by action on the part of others in health, policing, housing and education. This requires more than simply the provision of discrete services, it necessitates community leadership to shape the places and organisations in which they serve.

But whether in an organisation or a community, our approach is to build upon the concepts of social network analysis and community asset mapping to uncover value: identifying and then connecting individuals, teams, groups and institutions in order to facilitate the exchange of resources, skills and knowledge, between those who have and those who need. In the absence of such understanding individual, group and organisational effort can be needlessly duplicated, squandered or under-utilised.

Before you can improve your network you need to understand it. Improved connectivity, whether in organisations or communities, starts with a network map, a visualisation of the elements in your network and the relationships between them. A network map shows the nodes and links in the network, where nodes can be people, groups, or organisations, and links reveal the relationships, information flows or transactions between them.

Map in hand, you are then able to help connect those who have with those who need, and target your own organisational resources more effectively and efficiently. In short, community network analysis allows organisations to target their finite resources to where the impact will be greatest and unlocking the conundrum of doing more with less.

None of this will happen, however, without leadership. Left to their own devices networks develop naturally through proximity and homophily: natural human inclinations to associate with people who are near us or like us. While such bonds often contribute to a group’s strength, they can also inhibit communication between groups. Direction, however gentle or subtle is always required. Formal, positional leadership will remain important, but in a networked world leaders will increasingly be asked to lead without positional authority, across internal and external organisational boundaries.

It requires leaders who can see across the whole organisation or community, and make the sum of the parts greater than the whole. Leaders who recognise that opportunities and threats do not come neatly parcelled to fit the department, division, or sector into which we have arranged ourselves. Leaders who take responsibility for problems other than their own and can lead outside the constraints of their positional authority. In short, leaders who recognise that connectivity is crucial to a sense of belonging and improved productivity in the organisations and communities in which we work and live.

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Understanding Your Business

BusinessContext (1)Whether you are taking on your first role as a manager, swatting up for a management position interview in a new business, or making the move from functional to general management, you will need to demonstrate that you understand the wider concerns of the business. As well as dealing with the day to day issues of your team you it is essential to rise above these parochial concerns and use that knowledge to engage, impress and perform. But where do you begin?

In our leadership programmes we ask the delegates to become a Shadow Executive Team, and the foundation for this exercise is that they must understand the business. We therefore set them some pre-work. First are some basic questions:

  • What are the goals of your organisation – its main aims, including why it was established, what it expects to achieve and whose needs and interests it intends to serve?
  • Who owns your organisation – who established it, who provides the main financial backing and who takes responsibility for its direction?
  • What sector is your organisation in – describe the industry or industries it is part of and other organisations in that sector, including competitors, partners, collaborators, or agencies?
  • How big is your organisation – staff numbers, size and number of premises, and in comparison to others in the sector.
  • On what scale does your organisation operate – the number and type of customers, and their geographical spread.
  • What’s the scope of your organisation’s activities – the breadth and range of products and services it offers.

 

Then we ask them to examine the environment in which their business exists. There a number of tools for doing this, but we use RESPECT analysis. An acronym for regulatory, economic, social, political, environmental, competitor and technological factors.

 Regulatory/Legal factors refer to national employment laws, international trade regulations and restrictions, monopolies and mergers’ rules, and consumer protection. This is particularly important at present with the regulatory uncertainty surrounding Brexit and in what form British access to the single market may continue.

 Economic factors represent the wider economy so may include economic growth rates, levels of employment and unemployment, costs of raw materials such as energy, petrol and steel, interest rates and monetary policies, exchange rates and inflation rates.

 Socio-cultural factors include demographics, age distribution, population growth rates, level of education, distribution of wealth and social classes, living conditions and lifestyle. An important consideration in this dimension is ethics and how individuals and organisations act when faced with moral dilemmas. In the business environment this includes corporate social responsibility and the growing interest in social purpose within business.

 Political factors refer to the stability of the political environment and the attitudes of political parties or movements. This may manifest itself in government tax policies, or government involvement in trading agreements. In short, how business friendly is the political climate?

 Environmental factors focus increasingly on the issue of sustainability, with businesses beginning to see sustainability as a competitive advantage, not simply compliance or a way to reduce costs. The forces driving this are resource scarcity, which threatens the viability of some businesses; demand from customers for eco-friendly and healthy solutions; regulators demanding greater sustainability from companies; and employees, who want their companies to care for the environment.

 Competitive factors provide an assessment of the strengths and weaknesses of current and potential competitors. Competitors may be organisations in a related product/market; organisations using related technologies; organisations already targeting your prime market segment, but with unrelated products; organisations from other geographical areas with similar products; or new start-ups, perhaps organized by former employees and/or managers.

 Technological factors refer to the rate of new inventions and development, changes in information and mobile technology, changes in internet and e-commerce or even mobile commerce, and government spending on research. The tendency here is to focus on technological developments in digital and internet-related areas, but it should also include materials development and new methods of manufacture, distribution and logistics.

Thinking broadly and deeply about their business helps our leadership delegates to think more strategically and align their team purpose with broader organisational goals. Hopefully, this analysis will help you do the same and ensure that you rise above the other candidates.

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Christmas Conversations

It’s Christmas, does your heart sink at the thought of interminable small talk with distant cousins and great aunts? If so, “Let us,” as Mark Twain suggested, “Make a special effort to stop communicating with each other, so we can have some conversation.” By conversation I mean an interaction between two or more people, in which thoughts, opinions, ideas and feelings are exchanged, within the informal boundaries of polite give and take.

If you’re struggling to get answer, treat the conversation as a journey, go from place to place, but
not necessarily with any particular destination in mind. Use open ended questions like: what did you get for Christmas? What did you think of the Queen’s Speech? What was pudding like? How did you knit those wonderful socks? Why did you do it that way, are there alternative sock designs… or perhaps colours?

Alternatively if you are battling to get a word in edge ways, try raising your hand. It worked in school after all. But if Great Aunt Jemima refuses to desist and continues to lack the power of conversation, but not the power of speech, console yourself with the words of the great Roman orator Marcus Tullius Cicero that “Silence is one of the great arts of conversation.”

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Why Corporate Social Responsibility is not enough


‘The purpose of business is business’’

Milton Friedman (1962)

In the last 20 years income inequality has risen with household wealth of the top 10 per cent of society now more than 100 times the wealth of the poorest 10 per cent;  The major institutions, such as central government and banks have been found wanting; trust is at an all time low and financial institutions are seen as a key part of the collapse. The big government institutions of the post war era seem unable to work; the NHS, Social Services and Benefits seem are political hot potatoes.  There is a growing need for change in the world.

The neat divisions of public, private and third sector are falling away. Charities are filling the gap left by failing public services.  The demographics of society are shifting as the ageing population become simultaneously more dependant and more socially active; with the availability of time, ability and a pension.  Young people, saddled with student debt and no hope of home ownership remain living with their parents, insecure and frustrated, with diminished job prospects.

Social media hold individuals and governments to account; this rise of the ‘connected society’ drives the need for better conversation rather than state control.  In this era of fiscal austerity, the moral volume is turned up.

To date some organisations have responded through Corporate Social Responsibility initiatives, each with a laudable purpose and demonstrating how organisations can improve their world.  In the new world order this is no longer enough.  Organisations are being challenged to rethink their essential purpose.  The narrowness of self interest and share holder value replaced with a wider social activism and moral purpose.

Corporate Social Responsibility is no longer relevant and instead is replaced with a new understanding of the world that drives the moral and social purpose of an organisation.  No longer is it enough to focus on our customers; it is about recognising the wider number of lives that we touch.

From customers to the lives we touch; from transactions to relationships;  from shareholder value to societal value; from short term profit to sustainable profit; from high street presence to community asset; from wealth creation to creation of the common wealth.

How will institutions redefine their role in rebuilding community, stimulating social activism and engagement for the next 100 years.

‘The purpose of business is to create shared value’

Michael Porter 2011

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My Generation!

The sad fact is that in the UK and the developed world, we are slowly depopulating ourselves.  Birth rates are falling whilst longevity increases; in 2006 there were more 55-64 year olds than 16-24 year olds for the first time.  Whilst the ‘grey pound’ is a great opportunity for some businesses and the increasing need for related services this is an opportunity that is well catalogued.  At the same time the emerging next generation of future business joiners are proving to be very different to previous generations.

The Baby Boomers are the post war era generation, born between 1946 and 1964; whilst Generation X’ers were borne between 1965 and 1980.  The latest generation, ‘Generation Y’, are just coming into the working population and born between 1985 and 1995.

Each generation has different aspirations and ruling ideologies.  For the early Baby Boomers, growing in the optimism of the post war era and the sense of making the world a better place they continue to strive and believe that duty and patience pay off; often driven by an ethic that can best be summed up as ‘work hard and you will do better than your parents’.  For the late Baby Boomers they grew up in a world that saw its heroes crumble, be it Nixon or Kennedy; empires retracted and the cold war bred suspicion and a need for freedom; Woodstock and Flower Power were the anthem of the generation.

The Generation X’ers added disrespect for authority to the need for freedom and disregarded the need to accumulate wealth and position.  A generation that had been told that they could have it all now actually decided to take it!

It is perhaps too early to tell what Generation Y will bring to work; early indications suggest independence, social conscience, confidence and technological savvy.  They have new heroes that are more likely to be sporting than musical; they have embraced the democratic principles of the internet and are driven by brand and not loyalty; the free availability of credit means that they want it now and can have it too!

We face a world in which the Baby Boomers control the institution; Generation X are the managers and Generation Y are the consumers and new joiners.

Effective organisations need to look inside themselves to tap the rich source of ideas and energy.  To think about how they are defending themselves against another generation and to nurture and develop new talent.

The questions to ponder are:

  • How am I defending my generation?
  • How are we appealing to a new generation of employees?
  • How do we recruit and train them?
  • Once we have them, how do we manage and keep them?

Finally, try this, judge a generation by its heroes:

Churchill, Kennedy, Thatcher, Bob Dylan or Ellen Macarthur?

Who are your heroes?

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