Updated: Why do organizations have leaders?

This phenomenon is true for many leadership roles: If the leader doesn’t show up for work, the business will still run. When the CEO of a hospital misses a day of work, some work may slow down, but the hospital still can run and deliver care. When a trauma surgeon must miss work, their work needs to be covered to save and serve patients, and the operations of the hospital could grind to a halt without coverage.

Sometimes, you will see people in an interim leadership role or leadership roles being vacant for extended periods of time. You see that dynamic far less for positions that interact with clients or customers or who work in support organizations that make the business run. Short staffing is a problem in leadership, yet it is a crisis when it happens at the front line.

Why do organizations have leaders?

If most leaders are not “essential” to run the business, why have leaders?

The reason is that groups of individual contributors often cannot see the larger picture of what the organization is trying to accomplish. Organizations with high leadership turnover are often unstable. Before long, these organizations drift and cannot survive without planning and coordination. These organizations often face operational and financial issues. When an organization is failing and needs to “turn around”, it is usually the result of a failure or absence of leadership.

The Example of Ford Motor Company

One example of a turnaround in an organization due to failures in leadership is the case of Ford Motor Company in the late 2000s. Ford was struggling with declining sales and a loss of market share, and its CEO, Jacques Nasser, was criticized for his leadership style and strategic decisions. Nasser had pursued a diversification strategy that had failed to produce the desired results, and he was also accused of being too focused on short-term financial gains at the expense of long-term growth.

In 2001, Nasser was forced to resign, and William Clay Ford Jr., the great-grandson of Henry Ford, took over as CEO. Ford Jr. recognized the need for a fundamental shift in the company’s culture and strategy, and he embarked on a comprehensive turnaround effort that included a focus on innovation, quality, and sustainability. He also took steps to improve the company’s relationships with employees, suppliers, and customers.

Under Ford Jr.’s leadership, the company began to see improvements in its financial performance and market share. Ford introduced a number of successful new models, such as the Ford Fusion and the Ford Edge, and the company’s overall product quality improved. The company also became more focused on sustainability, developing hybrid and electric vehicles and reducing its environmental footprint.

Overall, the Ford turnaround was an example of how effective leadership can turn around a struggling organization. By recognizing the need for change and taking bold action, Ford Jr. was able to restore the company’s fortunes and position it for long-term success.

What a Leader does in a Company

A leader’s job is not only to keep things running day to day, but to optimize the work and drive results. Leaders are entrusted to oversee all aspects of their areas of responsibility to prevent the falling behind that inevitably happens without leadership. So while most leaders are not “essential” to run the business on any given day, they are “essential” and responsible for making sure the organization continues to grow and thrive into the future.

This orientation to what the work of a leader truly is, can be a difficult shift for new leaders. It is critical to make this shift and not revert to being an individual contributor. Leadership, as you will continue to see, is a fundamentally different job than showing up and performing your function each day. A leader’s point of view must be wider, learning all aspects of who and what make the organization work well, and longer, taking a point of view that extends out weeks, months, and years.

The Ford example illustrates another important point: Leaders that do not drive results often do not last long in leadership roles. If you lead in a business, producing financial results may be the top priority. Non-profit leaders may be measured by whether the number of people served is growing and whether the business is financially stable. If you lead your home-owners association, other homeowners may measure you on how you manage snow removal.  In any of these examples, if the leaders are not achieving the goals of the organization, senior leaders or boards of directors will look for different leaders who can achieve those results.

Knowing what results you are expected to achieve as a leader is extremely important. Accomplishing them in reasonable timeframe is the leader’s primary responsibility and what will either allow the leader to continue in their role or not.

I have seen leaders who have high employee engagement, high quality scores, and high customer satisfaction scores who are removed from their roles in leadership because they were not able to manage the finances of their department effectively in achieving those other results. New leaders must make sure they have clarity about what results are expected of them and in what timeframes. Then it is their responsibility to plan out how their teams will achieve those goals.

The Importance of Quick Wins

The results-oriented dynamic is one reason why it is vital to achieve, “Quick wins,” when entering a leadership role. “Quick wins” are usually small victories and must be respectful of the cultural context of the group. “Quick wins” give both supervisors and followers confidence that the leader is ready and able to produce results that drive towards their goals either directly or indirectly.

One of my favorite examples of a “Quick win” comes from the Apple TV+ show, Ted Lasso. The show is about an American football coach named Ted Lasso who is hired to coach a professional soccer team in England. In season 1, episode 2, Coach Lasso asks for suggestions for improvements he can make for the team, and finds one that says, “The shower pressure is rubbish.” He fixes the shower pressure so that it is stronger, which sends a positive message of support to his team. While not a big change, it is one that showed that Coach Lasso was able to create change in a way that the team suggested.

The “Dark-side” of Leadership

With that example in mind, a note of caution. A leader cannot achieve results at the expense of the psychological safety of the team. There is a “Dark-side” of leadership to watch out for. If a leader makes it all about themselves and sacrifices certain results over their teams wellbeing, they risk being perceived as a narcissist, jerk, or psychopath. When the relationship between the leader and the team breaks down, positive results will only be temporary as the leader will have lost their team and the team will eventually stop allowing the leader to lead them. They will rebel in either covert ways like “Quiet quitting” or overt ways. If you read this post and fall to the “Dark-side,” it will be a failure.

In summary, the sooner a new leader recognizes that the work of a leader is fundamentally different than the work of an individual contributor and requires a different approach, the faster they will be able to make the transition to impactful leadership.

Key Takeaways

While most leaders may not be essential for running the day-to-day operations of the business, they play a critical role in optimizing work and driving results. Leaders must have a wider and longer point of view to oversee all aspects of their area of responsibility and ensure the organization continues to grow and thrive.

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