By: Patrick Sweet - DECEMBER 10 2014
This news article appeared in Financial Times on December 10 2014. The article can be read here: link
Groundbreaking research on serious accidents and disasters demonstrates a clear link between an organisation’s leadership culture and the likelihood of these events occurring. An organisation’s leadership culture can save lives or end them, wreck habitats or preserve them.
Business schools have been criticised for producing ineffective leaders focused on narrow shareholder value. This is only part of the story. This important research on serious accidents shows that it is an organisation’s leadership culture not its leaders per se that makes the difference not only to the bottom line but also to life and death. Understanding this focuses attention on developing an organisation’s leadership culture over that of simply developing individual leaders themselves. MBA programmes should do more to understand the significance of this difference, and act on it.
In a decade-long study of serious accidents and organisational leadership culture in the marine industry, Torkel Soma of Propel in Oslo, Norway demonstrates that organisations that practise what he describes as laisser faire leadership cultures are 3.5 times more likely to incur a serious accident than cultures that practise collaborative excellence. Laisser faire leadership emphasises self-responsibility, self-risk assessment and rewards individual initiative in ways that usually increase risks taken.
Cultures of collaborative excellence are different. They encourage shared responsibility and collaboration across departments. They see failures and heed warnings as critical learning points rather than a cause for punishment. In summary, the likelihood of serious accidents or mistakes is inversely related to the collaborative and learning maturity of the leadership culture practised.
In a recent CCL survey of more than 500 top executives one of the top leadership practices most needed and yet least practised is cross-functional collaboration. Most executives understand how important collaboration across an organisation is to mission critical outcomes like innovation, service, efficiency and risk management. To reap the full benefits of cross-functional collaboration, this behaviour must be embedded as part of an organisation’s leadership culture and must not be confined to one or a few individual leaders. Collaborative leadership culture is most effectively developed in context — individuals collaborating on real-life shared challenges. Can business schools teach this?
Yes, perhaps, if they make it a priority. But there is a paradox here. Many outstanding business schools are known for their intra-disciplinary leadership culture (a strength when it comes to conducting narrow research) and not for cross-disciplinary collaboration. Teaching collaborative theory in the MBA auditorium or via Moocs (massive open online courses) can only convey information. If business schools are to have significant impact in influencing practice, it will take a transformation of much of mainstay academic leadership culture. This will require significant resolve and expertise.
The bottom-line is that myopic practices of functionally focused leaders will cost you, dearly. They may cost you lives, habitats and most certainly money. Business school MBA programmes are not set-up to develop leadership in practice. They never will be. Urging them to produce better leaders misses a fundamental point of today’s new ways of working, organising and leading.
It is no longer only about individual leader development. Sustainable effectiveness comes from developing collaborative leadership cultures. We should not ask business schools to change focus from the fantastic functional contributions they deliver in terms of science, research and practice. Leader and leadership development must happen in context, in action learning settings and with a focus on developing cultures of collaborative leadership over that of simply leader-led managers of business administration. The author is Business Development Director Northern Europe Center for Creative Leadership.