• June 3, 2017

Understanding Leadership: Mckinsey Commentary

 

In one of the latest Mckinsey research(latest is quite relative), over 90 percent of CEOs are already planning to increase investment in leadership development because they see it as the single most important,
human capital issue their organizations face. Insights, a UK-based leadership development company affirms the same level of interest in leadership development but shows that less than 10% feel they’re ready to address the leadership capability gap. The argument, over the time, has been that for the first time in history, we’re part of a five-generation workplace. Policies are being restructured to accommodate the delay in retirement plans for many over 60s, they will increasingly find themselves working alongside colleagues born in the 21st century.

This places an increased responsibility on leaders; there are unique challenges in attracting, retaining and truly understanding people whose life and work experiences are often at opposite ends of
the spectrum.

But one major problem that remains unsolved is the question of what type of leadership of leadership behavior organizations should encourage. Is leadership so contextual that it defies standard definitions or development approaches? What should companies prioritize? Interestingly, there seems to be no academic or practitioner consensus on the answers, leadership-development programs address an extraordinary range of issues, which may help explain why only 43 percent of CEOs are confident that their training investments will bear fruit.

Yet, it’s also obvious that 36% of leadership development practices are below average
So this was what Mckinsey did:
1. Used both hands-on experience and search of different academic materials, they compiled a list of 20 distinct leadership traits
2. Surveyed 189,000 people in 81 diverse organizations around the world to assess how frequently certain kinds of leadership behavior are applied within their organizations
3. They divided the sample into organizations whose leadership performance was strong (the top quartile of leadership effectiveness as measured by McKinsey’s Organizational Health Index) and those that were weak (bottom quartile).

Result: Mckinsey found something interesting:
1. That there are two types of organizations across the spectrum of leadership competence; organizations with high-quality leadership team which displayed 4 of the 20 possible behaviors. And the low-quality organization which randomly displayed the other 16.
2. These four(4) explained 89 percent of the variance between strong and weak organizations in terms of leadership effectiveness.

A deeper look into the four(4) leadership skills shows different narratives compared to what has been taught globally. Effective leaders are very supportive.

Based on our work in PM Hub, having worked with more 100+ leading African businesses and being involved in leadership coaching for executives, we can make some informative assumptions:

Real leadership starts with the mind. The first of the twenty (20) leadership skills that stand among the top requirement is the ability to Operating with a strong results orientation. Leadership is about not only developing and communicating a vision and setting objectives but also following through to achieve results. Leaders with a strong results orientation tend to emphasize the importance of efficiency and productivity and to prioritize the highest-value work.

Then in the quest to achieve results, strong leaders tend to put themselves out there to support others. That is the second(2nd) skill that is rated important. Leaders who are supportive understand and sense how other people feel. By showing authenticity and a sincere interest in those around them, they build trust and inspire and help colleagues to overcome challenges. And by challenges, we mean business challenges. They intervene in group work to promote organizational efficiency, allaying unwarranted fears about external threats and preventing the energy of employees from dissipating into internal conflict.

Great leaders are vulnerable. Seeking different perspectives. This trait is conspicuous in managers who monitor trends affecting organizations, grasp changes in the environment, encourage employees to contribute ideas that could improve performance, accurately differentiate between important and unimportant issues, and give the appropriate weight to stakeholder concerns. Leaders who do well on this dimension typically base their decisions on sound analysis and avoid the many biases to which decisions are prone.

Great leaders have better clarity of the company’s thematic goal and can use that to focus on solving problems. Solving problems effectively. The process that precedes decision making is problem-solving when information is gathered, analyzed, and considered. This is deceptively difficult to get right, yet it is a key input into decision making for major issues (such as M&A) as well as daily ones (such as how to handle a team dispute).

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