by Michael Jarrett
History is filled with tales of courageous and decisive heroes. Individuals like Julius Caesar and Winston Churchill, for instance, have led from the front to guide their people through adversity and achieve ultimate success. This myth building is especially prominent in the business sector, with stories of inspiring CEOs parachuting in to rescue and revive troubled organisations.
But is a strong leader who takes a centralised approach to company strategy really the best thing for an organisation experiencing change? Based on research I conducted with Professor Russ Vince from the University of Bath, the answer may often be no. This was our conclusion after studying the emotions of members of the senior management team at KleanCo (name changed), an FTSE 100 company headquartered in Europe.
A decisive leader can have a positive, and sometimes rapid, impact during periods of transformation. But we found that the emotional stresses that such centralised authority places on the organisation, and specifically on those in top management roles, make it difficult to maintain long-term. The tensions such an approach creates typically lead to failure for either the company, CEO, or both.
At the time of our study, KleanCo was going through a period of transformation. A “rag bag of loosely coupled silos”, the multinational was confronting a shift from a position of market dominance to one of fierce competition. Declining performance had led to calls for radical change from stakeholders, and a boardroom coup ushered in the arrival of a new CEO tasked with halting the slide. Continue reading