Leadership Development and Organizational Performance
by Aminat Ahmadu Abubakar- Stratford University, Falls Church, VA
Organizations that invest in leadership development have excellent organizational performance. Incompetent leadership results in poor organizational growth. Organizations require resilient and accomplished leaders who can inspire, motivate, and train their employees to do strategic work that will help ensure the organization’s success over an extended period. Employees within the organization depend on their leaders for direction and vision for the future to enable them to add value to the organization and ensure its success. According to Birkinshaw and Ridderstrale (2017, p. ix) “In today’s highly competitive business world, every company is looking for an edge, a source of differentiation over their rivals, and every leader is seeking to make his or her organization the best it can be.”
The impact of business and leadership on organizational performance is predicated on how the adaptation of the principles, concepts, and theories contribute to the foundation for business success. Among organizations, top priority training is leadership development. Organizations implement leadership development programs for three reasons that include “to increase their organization’s internal pool of leadership candidates, to reduce gaps in their current leadership members’ skills, and to develop new leaders more quickly” (Insala, 2016). Sanders (2017) states “Organizations that are seeking to build long-term success know that developing leaders at every level of an organization is crucial.”
Price (n.d.) describes strategic leadership development as “building your bench strength and developing a pipeline of leaders who are strong and capable; successful pipeline includes managers, employees, and board members.” Leadership development is not only about procedures for making employees better leaders. It starts with teaching leadership development in the organizational culture. According to Insala (2016), “To be successful as a strategy, organizations must focus on the development aspect – ensuring that there is a holistic plan in place that recognizes and fosters the growth of individuals’ skills, strengths, and talent.” The following aptitudes when mastered expertly steer leaders to effectively discharge their leadership role and successfully implement action plans leading to excellent organizational performance. These include:
- Emotional Intelligence
- Innovative Intelligence and Creativity
- Strategic Intelligence
- Financial Intelligence
- Organizational Intelligence
Leaders of the future must have the agility of being future ready to become future smart.
Leaders’ effective implementation of emotional intelligence has a great impact on the achievement of organizational goals and has a satisfactory relationship with the stakeholders. Emotional intelligence affects how we manage behavior, navigate social complexities, and make personal decisions that achieve positive results (Bradberry, 2015). Emotional Intelligence is an important trait to possess for today’s leaders and leaders of the future as they encounter various challenges. In 1998, Daniel Goleman popularized the emotional intelligence theory regarding organizational and job performance. He defined the approach as “The capacity for recognizing our own emotions and those of others, for motivating ourselves and others, and for managing emotions well in ourselves and our relationships” (Goleman, 1998). Most effective leaders have a common trait, a high degree of emotional intelligence. In a research conducted by Goleman, (2015, p. 1), and other studies showed that emotional intelligence is the sine qua non of leadership. Batool (2013, p. 88) explained that leaders who consistently outperform their peers not only have the technical skills required but more importantly, have mastered most of the aspects of Emotional Intelligence. It is not enough for a leader to have undergone the best training in the world, have an incisive and analytical mind with smart ideas but also requires excellent emotional intelligence to succeed.
Goleman, (2015, p. 6) posited five components of emotional intelligence: Self-awareness, Self-regulation, Motivation, Empathy, and Social Skills. The first three components grouped into self-management competency and the last two in social competency as it relates to a person’s ability to manage relationships with others. Ingrained inside personal skill and social competency are learned competencies as they relate to others and ourselves.
The Five Essential Components of Emotional Intelligence
Self-awareness is the first component of emotional intelligence. It is the ability in profoundly understanding one’s emotions, strengths, weakness, needs, and drives. Successful leaders that are self-aware are honest and realistic with themselves and others; they know their strengths and weaknesses. They are self-confident and have a self-depreciating sense of humor. Successful leaders show sensitivity to others within their organizations and the effect on job performance. Klemp (2005) noted that effective leaders are aware of the impact of their emotions to others; therefore, they channel how they come across in ways that bring out the best in others. Such leaders are in control of their feelings and the way they express it. Sometimes this can appear domineering; in such a situation, the leader creates a balance.
Goleman, Boyatzis, and McKee, (2013, p. 4) provided an example on the case of the news division at the BBC were an experiment conducted on 200 employees. The first executive went to deliver the management’s decision to close the news division to the employees. He drove the group towards antagonism and hostility in his action and mood, which was brusque, and in a hostile manner that incited the frustrated employees who became enraged. The executive felt threaten and needed security to take him out of the meeting. On the other hand, the second executive delivered the message to the employees in an optimistic and inspiring way in the face of difficulty. The executive action and emotional message delivery invoked passion for the journalistic service they offered the organization. Employees cheered after the speech.
These two examples showed the importance of the emotional impact on employees based on leadership words or actions in the organization. Such positive behavior sets successful leaders apart from the rest, reduces talent turnover, boost morale, motivates, encourages commitment from employees not affected in other divisions, and provides better business results.
Leaders can improve on self-awareness through the following practices (Emotional Intelligence in Leadership Learning, n.d.).
- Keep a journal, assign a few minutes daily to put down and access your thoughts; this would increase your self-awareness.
- Slow down and examine your emotions whenever you experience anger, this would teach you how to react to any situation.
Leaders who self-regulate themselves have control over their emotions and can channel any negative emotions positively. They seldom go on the verbal attack, do not rush into making impulsive decisions, nor do they stereotype people or compromise on their values (Emotional Intelligence in Leadership Learning, n.d.). An impulsive leader tends to make a rash decision to the detriment of the organization, the stakeholders, and employees. Such leadership losses credibility, but a leader that upholds self-regulation exhibits personal virtue and organizational strength. According to Goleman (2015, p. 12) people who control their feelings and impulse create a conducive environment of trust and fairness. The organization attracts excellent talents with less talent turnover. Politics and infighting reduced to a minimum leading to high job performance and productivity. Leadership that practice self-regulation can adapt and move the organizations and its people towards new/future innovative changes easily either through company merger, technology changes, company reorganization, or designing new products and services. Goleman (2015, p. 14) explained the signs of emotional intelligence to be a propensity for reflection and thoughtfulness, comfort with ambiguity and change, and integrity.
Leaders can improve self-regulation through the following practices (Emotional Intelligence in Leadership Learning, n.d.).
- Know and understand your values, what you cannot compromise on, and code of ethics. When you have a deep understanding of what is essential, you will be able to self-regulate when faced with a moral or ethical decision.
- Learn to hold yourself accountable for your words and actions. Do not play the blame game on anyone, face up to your mistakes, and accept the consequences.
- Practice being calm, this would help control emotions when faced with a challenging situation to redirect disruptive emotions into constructive action.
Motivated leaders are driven by the need to achieve, not by monetary reward, and work hard towards achieving their goals. A strong leader that sets the bar for high performance would lead the organization and employees into a high level of achievement to surpass targets. Goleman (2015, p. 16) noted that leaders with these traits could often build a team of managers around them with the same character–optimism and organizational commitment are fundamental to leadership.
Leaders can improve on motivation through the following practices (Emotional Intelligence in Leadership Learning, n.d.).
- Re-examine why you are doing your job if you are unhappy with the role to take a look at the root of the situation.
- Know where you stand and determine how motivated you are to lead.
- Be hopeful and find something useful, be optimistic when faced with problems and look at the positive side.
Empathy is an essential component of a leader in managing an organization, and employees. Empathy is thoughtfully considering employees’ feelings—along with other factors—in the process of making intelligent decisions wrote Goleman (2015, p. 16). Leaders develop others within their teams/organization, are sensitive to cross-cultural differences due to the rapid pace of globalization, they give constructive feedback, and can listen attentively. Empathetic leaders put themselves in others’ situation in a subtle way without being brusque to employees’ emotions before they make hard decisions towards the improvement of the organization. Such empathetic leaders earn respect and loyalty by attracting and retaining great talents in their organization. It is imperative because when good talents leave, they take away with the organization’s knowledge.
Leaders can improve on empathy through the following practices (Emotional Intelligence in Leadership Learning, n.d.).
- Put yourself in someone else’s situation in discussions or when making decisions by taking the time to look at other people’s perspectives.
- Pay attention to body language, when you listen to the other person, use appropriate body language to respond appropriately.
- Respond to feelings, and learn to show appreciation to others.
Social skill is friendliness with a purpose; moving people in the direction the leader desire, whether that is agreement on a new marketing strategy or enthusiasm about a new product (Goleman, 2015, p. 19). Effective leaders create a personal connection with employees and are adept at managing teams. They are excellent communicators and know the right message to disseminate that keeps employees motivated. The most effective leaders make themselves visible and approachable—engage employees individually and in groups, listen to ideas, suggestions, and concerns (Klemp, 2005). Team members are excited to support an emotionally intelligent leader on new projects; such leaders manage change and conflicts tactfully. Goleman, (2015, p. 20) noted that leaders manage relationships effectively, the leader’s task is to get work done through other people, and social skill makes that possible. Such leaders can work with stakeholders and competitors towards achieving their organizational goals.
Leaders can improve social skill through the following practices (Emotional Intelligence in Leadership Learning, n.d.).
- Learn conflict resolution by knowing how to resolve conflicts among team members, customers, or vendors.
- Improve your communication skills.
- Learn how to praise others; a leader inspires loyalty from employees by merely giving praise when earned.
Incorporating Emotional Intelligence in Leaders of the Future
We live in changing times as our world evolves and becomes global. Leaders of the future have to think differently from today’s leaders in connecting the future with the past. Georg Vielmetter noted that the future would require a new style of leadership, a leader who not only navigate the complexities of the business environment but also have an awareness of subtleties of leadership (HayGroup, 2014, Trending near you). Global trade and integration of global technological breakthroughs such as digital remote communications, social media, automation through artificial intelligence, and robotics have transformed organizations, industries, and governments. It has led to a mix of diversity due to the global interconnectivity of the workforce and business interaction.
The effect on the new shift requires a change in the mindset and competencies of the leaders. It becomes imperative to incorporate Emotional Intelligence components such as self-awareness, self-management, social awareness, and relationship management for leadership success (Goleman, 2015). Leaders of the future must have the skill of being future ready to be future smart.
Essential Competencies for Leaders of the Future
According to Goldsmith, and Walt, (2009) stated that Accenture Consulting with the Alliance for Strategic Leadership researched the characteristic of the future leader from over 200 future leaders in more than 120 companies around the world. Five essential competencies for the leader of the future that emerged included (1) Think globally, (2) Appreciate cultural diversity, (3) Demonstrate technological awareness, (4) Build partnerships through collaboration, and (5) Shared leadership.
Leaders of the future can no longer think locally due to globalization in trade and technological advancement. Leaders have to understand the legal and political implications of globalization to their leadership and organization. To have an awareness of multi-country business, it becomes imperative for leaders of the future visit other countries to learn and have a better perspective on how they can have a competitive edge in leading their organizations in the global environment. O’Sullivan (2015) noted that people with experiences and perspectives from other places are in a better position to offer context and valuable information which might not come across the minds of locals or readily accessible through other means.
Technology has broken barriers in the global businesses; no longer would the organization be limited to the local workforce. Instead, organizations make-up would be of a worldwide workforce, “a computer programmer in India can communicate with designers in Italy to help develop products that are manufactured in Indonesia and sold in Brazil” (Goldsmith, & Walt, 2009). Here effective communication management becomes vital. Additionally, leaders have to be global sensitive to their workforce abroad and business partners due to their locations in different region and time zone.
Leaders of the future must think globally to succeed in their leadership and have a competitive edge in the achievement of the organizational performance in the global market.
Appreciate Cultural Diversity
Diversity management is a crucial competency for the leader of the future and the organizational leadership success. Leaders should be able to distinguish between representation and diversity. Representation is the presence of multiple races and genders in the workplace; while diversity is the differences, similarities, and tensions that can or do exists between mixtures of people, explained by Hesselbein, and Goldsmith (p. 48-49, 2006).
Leaders of the future should become more aware of cultural diversity due to globalization. They would have not only a better understanding of economic and legal differences but also a social and behavioral difference. Professor Geert Hofstede researched the influence of culture at the national level and workplace. He explained that culture is “the collective programming of the mind distinguishing the members of one group or category of people from others” (Hofstede, n.d.). GEERT Hofstede’s six (6) cultural dimension is an internationally recognized standard for recognizing different cultures that could help the leaders viewpoint on how to approach people in a diverse society. Geert country comparison tool provides values for the six (6) dimensions (Hofstede, n.d.).
For example, a business card exchange in the United States and the United Kingdom does not require much ceremony. In China, business cards are exchanged on initial business meeting with a contact. Business cards should be two-sided first side written in English and the other side translated into Chinese. The English side faced up and hold with both hands, and when received are scrutinized. In China, business cards are treated with great respect (Chinese meetings n.d.). Besides, the meaning of eye contact seen differently by different cultures. Direct eye contact in the United States seen as appropriate, but in Asian and African culture lowering of the eyes shows the mark of respect.
Leaders’ ability to motivate people in diverse cultural settings is important. What is acceptable as normal motivation in the United States might be offensive to another cultural group. Leaders who understand such dynamics in diverse cultural motivations will become a valuable resource in future leadership brand. For example, recognition as a form of motivation differs based on cultural background. In the United States or Australia employee of the month scheme in which individual employees’ recognition and praised publicly is an acceptable norm. In the Asian culture, an employee singled out for recognition causes’ embarrassment. Instead, employees prefer recognition based on hard work as part of the team or collectively (MacLachlan, 2016).
Demonstrate Technological Awareness
The need for technological awareness to lead in the global environment cannot be overemphasized as new technological advancement is beginning to transform various aspects of our lives from business, communication, education, energy, food, healthcare, manufacturing, medicine, politics, and transportation. Technological awareness is the ability to understand the application and capabilities of technology to business success. The leaders of the future should understand the intelligent use of technology through automation of their business processes within the organizations both within and outside. They would be able to recruit, develop, and retain technically competent employees. Use technology to gain insight into customer segment in designing their value proposition. Understand the importance of investing in new technology, and be a leader in the advancement of technological innovations.
For example, Haggerty, (n.d.) listed Robert McDonald, CEO of Proctor & Gamble, Peter Brabeck-Letmathe, Chairman and former CEO at Nestle S.A., Lorenzo Zambrano of Cemex in Mexico, Massimo Bongiovanni, CEO of Coop Centrale in Italy and Toshifumi Suzuki, CEO of 7-Eleven Japan as technological awareness business leaders. She further explained that they communicated an organizational vision that included Information Technology (IT) in the role of value creation; they engaged in strategic IT decisions and mandated top management team to follow the same; they construct an equal partnership between business and IT that resulted in the achievement of maximum return on investments.
Another example of today’s leaders seen as leaders of the future is Jeff Bezos, founder and Chief Executive of Amazon.com and owner of The Washington Post. Bezos revolutionized computing storage with Amazon Web Services; and the retail industry through Amazon.com that in 2016 accounted for 43% in online sales (Fry, & Heimer, 2017). The company through his leadership changed the American consumer into making online purchases that affected Mom and Pop shops, Barnes & Noble, Circuit City amongst others to go out of business.
Jack Ma, Founder, and Executive Chairman of Alibaba Group from China, like Jeff Bezos of Amazon.com, built his business around e-commerce with an estimated fortune of $30 billion (Fry, & Heimer, 2017). While Ma’s platform Alibaba.com has captured the China regional market, it also enables small business to reach other parts of the world; but it is yet to win the American market, as Amazon.com is the dominant force in the region.
Well-informed leaders with technological awareness and its application in the business environment have a competitive advantage over their counterparts and organizations that do not.
Build Partnerships through Collaboration
Leaders of the future’s ability to build partnership and alliance would be a significant trend for the future. According to Goldsmith, and Walt (2009), the ability to negotiate complex alliances and manage complex networks of relationships is viewed as becoming increasingly important. The role of customers, suppliers, and partners in industries like energy, telecommunication, and pharmaceuticals becomes blurred. The same organization can turn round to be a customer, supplier, partner, or competitor, therefore; leaders have to be agile in adapting to marketplace changes.
Leaders of the future must have the competency to learn and collaborate both within and outside the organization. Such traits provide the leader and organization with a competitive edge in the marketplace. For example, LEGO Company creates educational tools to educate children about real-world challenges. LEGO signed an accord with NASA known as the Space Act Agreement. The agreement was a 3-year collaboration to promote technological, engineering, and mathematics among science students in different levels of education. This form of learning helps develop skills in creativity, design, and engineering principles in children (Turiera, & Cros, p.49, 2013). In addition, March 21, 2017, IBM InterConnect announced IBM collaboration with AT&T to deliver new Internet of Things (IoT) innovations to the market to support enterprise customers’ IoT with data insight (Slowey, 2017).
A partnership through collaboration is the key to lasting business success. Leaders of the future who envision the future rather than procrastinate are the ones who triumph in the new global economy.
Shared leadership is vital for the leader of the future in every organization. The intricacies of the future business environment make it difficult to lead. No one person can possess all the skills and ability to lead. Management of knowledge workers should play a vital role for the leader of the future it would require “leading across a fluid of network” rather than “a fixed hierarchy says Goldsmith, and Walt (2009). As globalization continues the need for professional knowledge and expert worker increases due to organization merge, and industry restructure. The knowledge workers of the future would see themselves as professional free agents with minimal loyalty to their organizations. The knowledge worker enjoys the challenges and opportunity that requires a climate of entrepreneurship and creativity. Leaders of the future must cultivate skills in hiring, developing, and retaining the knowledge workers. As such, shared leadership should involve the engagement of human resources in the organization to enable a knowledge worker to act by encouraging a passion for work through collaboration and team spirit building.
For example, Mary Barra CEO of General Motors says, “Good ideas do not have hierarchy” she further explained that “No matter your industry, ideas can come from anywhere — from the line, the retail floor, or at your engineering center” (Barra, 2016). Each has a valuable and unique viewpoint.
Effective implementation of emotional intelligence by leadership has an enormous impact on the achievement of organizational goals. Such leaders inspire and motivate employees into excellent job performance and productivity. It builds trust and loyalty. It reduces workplace stress and infighting. It attracts excellent talents and reduced talent turnover in the organization.
Emotional intelligence is a valuable positive attribute. Evidence has shown there is a darker side to emotional intelligence; leaders can manipulate and control others into doing things contrary to their beliefs. Research result conducted by Professor Martin (University College of London) and his team established that emotionally intelligent people “intentionally shape their emotions to fabricate favorable impressions of themselves” (Grant, 2014, p. 4). Furthermore, “The strategic disguise of one’s own emotions and the manipulation of others’ emotions for strategic ends are behaviors evident not only on Shakespeare’s stage but also in the offices and corridors where power and influence are traded.”
Successful leadership built on the application of emotional intelligence is a great thing to achieve. It is not a one-time activity, it is a lifetime commitment, to yourself and to all those you serve. Still, as a leader, emotional intelligence kept in perspective is an important requirement for successful leadership. It plays a crucial role in a satisfactory relationship with clients, partners, stakeholders, and overall organizational success.
- As leaders, you can adapt to changing conditions, have the willingness to self-improvement and development to enable you to become a successful leader of the future. Embracing diversity becomes crucial.
- You must show a willingness to help, mentor and develop leadership training for talented prospective leaders of the future.
- Leaders should show resilient with the ability to see the future when others cannot. Leaders of the tomorrow must have the agility of being future ready to become future smart.
How well prepared are you today to become a leader of the future?
Creativity and Innovative Intelligence
The practical application of creativity plays a critical role in business success and sustainability. Creativity is the process by which people within a business bring value and practicality in product design and service offerings that are novel, useful, and relevant to their customers, and the market. Sloane (2017, p.8) defines creativity and innovation as “Creativity is the ability or talent to create. It is about generating ideas,” and “Innovation is the implementation of the new idea. According to Sloane (2017, p.1) “The best way to create value is to innovate your way ahead of the competition to create temporary monopolies where yours is the only show in town.” You as a leader can achieve this by harnessing the creative power of your greatest asset, your people. To turn them into opportunistic entrepreneurs who continuously scan the real-time environment searching for new innovative ways of doing business.
Most organizations are stuck in doing the same thing repeatedly with no focus on a new business direction. Gary Hamel a management guru buttress this observation “Most companies are built for continuous improvement, rather than for discontinuous innovation” (Sloane, 2017, p.5). They have the idea but lack the incompetence. Andy Grove, former Intel Chief Executive, view on the need for innovation and the challenge for change as “Only the paranoid will survive” (Sloane, 2017, p.6). He went ahead to say one has to be paranoid about improving the goods and services offered to clients otherwise someone would do that ahead of your business. Intel’s business philosophy is to cannibalize its own business by always evolving newer and better processors, and this is what has made the company a leader in the PC processor business world.
Steve Jobs in the 1982 Gold Plate Award by the Academy of Achievement, in Washington DC, made an acceptance speech on creativity. He stated, “to make a connection which is innovative…you have to not have the same bag of experiences as everybody else.” Jobs continued, “or else you are going to make the same connection as everyone, and then you would not be innovative, and then nobody will give you an award” (Baer, 2015).
Application of Creativity in Business
From an organizational viewpoint, Mumford, Hester, and Robledo (2012) described creativity as the “production of high-quality, original, and elegant solution to problems” (cited by Duxbury, 2012). It shows creativity involves the application of in-depth cognition in decision making for problem-solving. Also, the criteria for the disruption of normal organizational routine activities have to be novel, useful, and relevant.
Creative ideas can lead to incremental changes or a complete revolutionized innovation in business or the industry. Duxbury (2012) wrote, “Creative stage or solutions varies by field or job involved, in the end, creative behavior results to some extent identifying original and better ways to achieve something useful.” He provided examples of organizational tasks that creative element be applied such as in business models, strategic decision-making, problem-solving, product development, managerial activities, marketing, operational process, financing, and everyday improvements in the workplace routines.
Robert Galvin at Motorola saw the importance of creativity in business. He emphasized the importance of creativity as “intentional parts of its productive process” (Csikszentmihalyi, 1996, p. 80), to survive the competitiveness of the Pacific Rim electronic manufacturers. Employees at Motorola were encouraged to think creatively towards the generation of novel ideas without fear of criticism. As a leader, you must learn and recognize which amongst all the ideas are novel and valuable to the business, and more importantly the ability for proper implementation. Employees’ creative thinking on generating ideas as noted by Csikszentmihalyi (1996, p. 31) “depends on how well suited the respective domains and fields are to the recognition and diffusion of novel ideas.” That is what calls for the successful implementation of practical business applications of creativity.
Creativity can be encouraged or discouraged in three ways, through the clarity of structure, the centrality within the culture, and accessibility. For a business to succeed, it is dependent on the creative potential of their employees or researchers, the availability of fund set aside for research and development. Creative innovation strives more in companies where knowledge is structured, centralized, and most accessible by employees. In a business setting “is the production of new ideas that are fit for a particular business purpose” (Pryce, 2005, cited by Proctor, 2014, p.4). Batey, (2012) explains, “A creative product is that which is deemed to be novel original and useful or adaptive” (cited by Proctor, 2014, p. 4).
Proctor, (2014, p.9) explains, “Creative leaders actively hunt for new problems and are especially successful in handling new challenges that demand solutions outside the routine of orthodox strategies.” Such leadership creative actions and vision inspires others to perform at their peak. Csikszentmihalyi sees the individual as the innovation manager, the domain as the discipline of creativity, and the field comprised of the gatekeepers, for example, Chief Executive Officers whose decisions either allow or inhibit individual or group innovation (Reis, n.d.). Leaders influence change in organizations. A stagnant company produces poor performance, poorly motivated employees, loss of relevance, and failure in leadership.
Application of Innovation in Business
What makes for a successful innovation company? It starts with the leadership role, which is to define the company’s innovation strategy and align it with the business strategy. Successful companies share a basic set of innovation capabilities. They can customize innovation strategies in line with the companies’ culture. Such companies have in-depth insight into customers’ needs and the awareness of important emerging technologies during the ideation phase. They can interact with customers at the product development stage to enable test the concepts and risk assessment and achieve products and services development breakthrough. These companies can work alongside users during product trial period, and effectively introduce the product to the market. IDEO human-centered design model believes all problems are solvable. They involve the “communities in order to understand the people they are looking to serve, to dream up scores of ideas, and to create innovative new solutions rooted in people’s actual needs—about believes that as long as you stay grounded in what you have learned from people, your team can arrive at new solutions that the world needs” (IDEO.org, 2015). Companies such as Apple, Toyota, Dell, Nucor Steel, and Google implement innovation changes in the company’s business model or technology to make a mark on the growth of their businesses.
Embracing Culture, Creativity, and Innovation
Winning leaders are at the center of any successful organizational adhocracy culture, “one of the key roles of the Chief Executive Officer (CEO) is to make innovation part of the culture of the company,” (Davila, Epstein, and Shelton, 2013, p.260). They support an environment and empower rather than regulate or limit their employees. Hunter, Bedell, and Mumford, (2007) stated, “Organizational support involves the availability of resources for the implementation of new ideas, support for discussion about new ideas, top-management support, and the use of rewards for good ideas (as cited in Kamatigam, 2017, p.3). Successful entrepreneurial leaders in the adhocracy culture are innovative, creative, and a focus on the future. “Adhocracy culture most highly values new products, creative solutions to problems, cutting-edge ideas, and growth in new markets as the dominant effective criteria,” (Cameron, and Quinn, 2011, p.55) for organizational effectiveness with a total focus on delivery to the customer.
The measurement of organizational efficacy reflects in the design of new innovative products or services, offering solutions to problems creatively, generation of new pioneering ideas, seeing new opportunities, and gaining new customers. Drucker (1985, p.19) wrote, “Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or a different service.” “Innovation is considered to be one of the most significant factors that influence the success of a business in today’s intensely competitive and dynamic environment, and creativity is the most basic and critical component of innovation,” (Kamatigam, 2017, p.8). Leaders have become aware of the importance of creativity in problem-solving, and the creation of innovative products and services. “Leadership needs to lead the charge in defining the innovative strategy and encourage truly significant value creation—must provide guidance on the types of innovation the organization should seek, where to explore for ideas, how to create great value—what makes a great innovation looks like,” (Davila et al., 2013, p. xxxv).
According to Mark Benioff, Chairman, and CEO of Salesforce.com, “The CEO’s role is in leading the company to develop new models—business, technology, and leadership models—that will drive innovation to fuel growth and profitability,” (Davila et al., 2013, p.260). Davila, Epstein, and Shelton, (2013, p.264) posit the seven Innovation Rules that provides the leadership with the basis for smart execution:
- Exert strong leadership in defining the innovative strategy and designing innovations portfolios, and encourage excellent value creation.
- Match innovation in company business strategy, such as ‘Play to Win or Play Not to Lose.’
- Make innovation a core of the company’s business mentality, and put in place processes that support the organization’s culture of innovation.
- Balance creativity and value capture so that the company generates successful new ideas to create maximum return on its investment.
- Neutralize organizational antibodies that kill off good ideas because they are toxic and different from the norm.
- Create innovative networks inside and outside the organizations; networks, not individuals, are the basic organizational building blocks of innovation.
- Implement the correct metrics in performance, and rewards to make innovation manageable to produce the right behavior.
- Such entrepreneurial leadership smart execution strategy and actions inspire employees to perform at their peak and harness creativity and innovation in the design of new products or services that leads to organizational growth.
Creativity is the lifeline for the existence of any business, and its sustainability as such creative ideas must be novel, useful, and relevant. A company that encourages a creative environment thrives because leadership understands the importance of expertise and skills as an “important asset” that has a positive impact on business growth. Such an environment does not punish failed attempts by employees. “An atmosphere that welcomes ideas is a necessary prerequisite for an innovative organization” (Sloane, 2017, p.140). Creativity brings about new ways of marketing appeal on products or services, unique insight to efficient and effective production methods, ideas to customers’ wants and needs, identification of new innovative business opportunities, and improvement on employees’ motivation. As a business, we do need to be creative, and the creative process involves hard work.
- Leadership should define the company’s innovation strategy and align it with the business strategy.
- Communicate the benefit of innovation to the organization that results in company growth.
- Set targets for innovation in products, services, and process to enable meet deadlines.
Are you ready as a leader to encourage the creative talents in your business to help achieve success to remain relevant and be sustainable?
We witness how organizations grow and become successful in the market, suddenly as time goes on some organizations wither and die. When such an event happens, it affects its employees, investors, and the communities. What leads to such organizational failure? These organizations become complacent because they see problem approaching but decide to overlook or play down due to the substantial investment in the organizational structure as such as physical assets, people assets, or affiliation assets. Leadership and management find it difficult to change or adjust. Besides, Büchel, (2010), pointed out that when organizations executives fail to pay attention and commit the following mistakes, they miss great opportunities. These mistakes involve miscalculation on industry boundaries, miss the mark to identify emerging competition, lost contact with customers, amplify competitor’s visible competence, and oblivion to limit their frame of references. The application of strategic intelligence to strategic decision-making by executives helps in the avoidance of such mistakes.
The use of intelligence in a practical sense, when implemented correctly in an organization, can act as a tool for both the executive and management cadre as well as the operational and functional levels of employees. Străin, (2013, p. 109-110) noted that intelligence plays a role in the executive and management level in relationship to the development of organizational strategies such as the mission, the goals, programs, and resource planning. Additionally, lower level managers deploy intelligence specific to current, immediate, and routine operations.
Strategic Intelligence in Business
Strategic intelligence used in various contexts. John R. Wells, Professor of Management Practice and author of the book Strategic IQ, (as cited in Blanding, 2012) defines strategic intelligence as “the capacity to adapt to changing circumstances, as opposed to blindly continuing on a path when all the signals in your competitive environment suggest you need to change course.” Liebowitz, (2006, p.22) explains strategic intelligence in business settings as “how best to deal with future challenges and opportunities to maximize the firm’s success.” Strategic intelligence is an essential component utilized for an effective strategic decision-making process by organizations to sustain business growth. Heidenrich, (2008) describes, “Strategic intelligence is that intelligence necessary to create and implement a strategy, typically a grand strategy, what officialdom calls a national strategy. A strategy is not really a plan but the logic driving a plan.”
Lafley and Martin, (2013, p. 211) aptly noted that a lack of strategy has a more transparent and more obvious result: It will kill you — organizations without winning strategies die. For example, an organization can easily invent a new product/service, build on it, and successfully take it into the market. Nevertheless, for an organization to have a competitive edge and be successful with the value proposition the application of strategic intelligence must be in place during the strategic decision-making process.
The strategy requires solid choices being unique in a business choice “Strategy is an integrated set of choices that uniquely positions the firm in its industry to create sustainable advantage and superior value relative to the competition” (Lafley & Martin, 2013, p. 3). “The job of a strategist is to understand and cope with competition,” (HBR’s 10 Must Reads, 2011, p. 39). Understanding the competitive forces in the industry structure provides a true picture of the present profitability that provides a future framework that would help an organization influence competition in the end. Organizations should analyze the present carefully; anticipate changes in the market or industry after that plan how to succeed in the future. Planning to succeed is important, vital to anticipate and prepare for the future. Mohammadian, (2017, p.4) noted: “effective strategic planning articulates not only where an organization is going and the actions needed to make progress, but also how it will know if it is successful.”
According to Lafley and Martin, (2013, p. 212) the following five strategic questions must be answered to have a competitive edge.
- Have you defined winning, and assured about your winning aspiration?
- Have you decided where you can play to win, and where you will not play?
- Have you determined how you will win where you choose to play?
- Have you identified and built your core capabilities to resolve your where-to-play and how-to-win choices?
- Do your management systems and critical metrics support your other four strategic choices?
Büchel (2010) suggested, “Organizations that want to maintain business growth over longer periods of time need to extend their thinking to include services, solutions, or families of products.” She further advised the application of strategic intelligence a coordinated combination of research, analysis, and distribution of information necessary to make strategic decisions that allow growth opportunities to flourish through the following six steps: trends, customers, benchmarking, category extension, capabilities, and technology.
- Trends: Executives should exercise great foresight and pay attention to global trends in demographics, regulations, and consumer markets.
- Customers: Organizations have to concentrate on customer needs to gain customer insights through research and to listen to customer feedback.
- Benchmarking: Executives must continuously compare their business processes and practices within the industry and outside in their strategic decision-making.
- Category extension: Examine how consumers define their needs. Analyze the organization’s internal organization process and value proposition. Consider modification and creation of new offering to satisfy consumers’ needs.
- Capabilities: Organizations explore ways to build on their abilities to enhance methods for business expansion.
- Technology: Research ways technology can optimize business operations.
Pellissier and Kruger, (2010) stated strategic intelligence provides value for managers in their role in the strategic development process through a fact-based decision. It allows managers to quantify strategic choices and articulate strategies. This action results in a robust internal performance control that leads to a competitive edge and innovative practices.
Maccoby (2001) noted the following five interrelated elements or competencies that make up strategic intelligence for successful leadership.
- Foresight – is the ability to sense opportunities and threats in trends that shape the future of the organization.
- Systems thinking – is the ability to recognize and incorporate elements to fit as a whole entity within the organization.
- Visioning – the combination of foresight and system thinking to develop and implement an ideal vision for the future.
- Motivating – is the ability to drive, inspire diverse people to accept and achieve the ideal vision willingly.
- Partnering – is the ability to form strategic alliances with organizations, groups, and individuals to build on strength.
Furthermore, high-performance organizations leadership deploys strategic intelligence in their strategic decision-making process to enable consecutive win in the market. They are aware of their environment of present and emerging industry trends, customer insights, internal organizations capabilities, and competitors’ capabilities, as well as new technology trends, to have a competitive edge. It is through making choices and acting upon them that makes business came out as winners. What matters most in business is winning, Great organization—choose to win rather than play (Lafley, 2013, p.5); requires clear and hard thinking, real creativity, courage, and personal leadership (Lafley, 2013, p. 6). It involves a coordinated and integrated set of five choices: a winning aspiration, where-to-play, how-to-win, core capabilities, and management systems.
Strategic Intelligence Business and Analysis Techniques
Strategic intelligence allows leadership to visualize the future direction of the organization. It enables the organization to observe emerging trends within and outside the industry and predict threats or opportunities. Envisages outcomes of a strategic plan or planned projects to the organizational vision; thereby enable the development of a backup plan that falls in line with the achievement of the organization’s mission and goals. Example of some of the business and analysis techniques used to examine and evaluate data for integration into business strategy are the STEEP analysis, Porter’s Five Forces Model, and SWOT analysis tools. Fleisher and Bensoussa, (2002, p.2) explained, “It is about breaking down an issue into part—to derive correlations, evaluate trends and patterns, identify performance gaps and above all to identify and evaluate opportunities available to organizations.”
Blum (n.d.) explained the five trends of STEEP analysis as Social, Technology, Ecology, Economic, and Political/Legal. When implemented correctly provide decision makers with data to comprehend future trends in the industry, assess the correlation between patterns, relates trends to issues, forecast the future direction of problems, and determine the implication to the organization’s strategic plan.
- Social: The social trend describes how people live differently globally in societies. Some of the market indicators are demographic, lifestyle, religion, education, and age distribution of the population. Changes in the environment can be disruptive as such there must be constant monitoring activities to effect changes in strategy.
- Technology: Awareness of technology trend is vital for a business to thrive in the development of products and services due to evolving changes in the industry as in the example of the Mp3 player. Apple came out with enhanced features in the form iPod and Apple Store and changed the digital technology industry.
- Economic: Economic trend can be analyzed locally or globally. A downturn in the global economy in one nation can have a cascading effect in other countries. Constant monitoring and analysis of the economic environment as it affects people spending power on products and services are required to enable organizations to adjust and remain competitive.
- Ecological: These are concerns that arise in the natural resources environment encountered by organizations in the line of operations. Organizations involved in the use of natural resources should study the ecological situation of countries they do business with regarding products and services to prevent legal issues.
- Political/Legal: The analysis provides an understanding of both the political and legal environment in each country or region an organization operates in or is about to serve in. Change in ideology and failure to adapt in the political or legal environment can cause a loss of revenue.
Porter’s Five Competitive Forces involves the bargaining power of buyers, bargaining power of suppliers, the threat of new entrants, the threat of substitute, and rivalry among existing competitors. Michael E. Porter noted in ‘The Five Competitive Forces that Shape Strategy’ (as cited in HBR’s 10 Must Reads, 2011, p. 65) that insight into industry structure would guide leadership to position organization cope better with current competitive forces. Anticipate and exploit shifts in the forces, and shape the balance of forces to create a new industry structure that is more favorable to the organization.
SWOT analysis is a tool that assists in making strategic plans and decision. It identifies organizational strengths and weaknesses internal situation, and the external environment assessment on opportunities and threats. Leadership and management use the analysis tools to design, review, or update the strategic plan to align with its capabilities and resources in line with the internal situation and external environment. The Mind Tools Content Team (n.d.) noted, “A SWOT analysis could uncover a weakness in business policy or processes or the strength of the organization’s marketing objectives.”
Strategic intelligence organizations create a winning strategy, thereby move into the blue ocean category, and stand out among their competitors. Their operational activities become distinct and hard from copying by their competitors. They command great customer loyalty for their products/services, as well as attract the interest of non-customers. Increase in revenue generations that result in more resources to create more value and protect the organization’s territory.
Example of an organization that deployed strategic intelligence and implemented a winning strategy is Apple under the leadership of Steve Jobs former Chief Executive Officer. Apple in 2003 introduced into the industry iPod along with the iTunes store, which in a sense is a combined technology around the organizational winning business model. What Apple did was to develop a breakthrough business model that incorporated hardware, software, and service. Apple offered, “The low margin iTunes Music for free to lock in purchase the high-margin iPod” (HBR’s 10 Must Reads, 2011, p. 103). It led to value creation for the organization and a game-changing experience for the consumer.
- You must understand as a leader the significance of strategic intelligence in the strategic decision-making process as it relates to the internal business operations, business insights, and opportunities.
- Learn to scan the environment and ask questions.
- Include diverse people with different experiences in the area of expertise.
- Your organization must integrate strategic intelligence into the organizational culture to motivate employees’ thought processes in creativity and innovation in decision-making.
Today’s leaders must be able to use their financial knowledge or skills to convince investors to fund the organization’s projects. They should have the ability to use financial tools to forecast, mitigate risks, and make a financial decision. Future smart organizations invest in their employees, systems, and process to establish intelligent finance functions. Financial Intelligence is critical to leadership function. It provides a better understanding of what numbers stand for and knowing what is happening in their organization from the financial perspective. It helps to make a well-informed and practical decision. Berman and Knight, (2013, p.18) pointed out some benefits derived from financial intelligence.
- Leadership has increased ability, to evaluate the organization, and can ask specific questions. How profitable are the products or services provided by the organization? Is there enough cash to make payroll? Is the return-on-investment (ROI) analysis conducted base on robust data in regards to the capital expenditure proposal? It enables better insight into trends and understanding of numbers to access the organization’s performance and prospects.
- Financial intelligence provides leadership with a better understanding of the bias in the numbers. It instills “knowledge and confidence to question the data provided by your finance and accounting department-ability to identify hard data, the assumptions, and the estimates” (Berman & Knight, 2013, p.20). Decision and control relegated in the hands of the accounting and finance department team. Leadership makes the final decision based on facts on the ground where there is a final acceptance by everyone.
- It provides leadership with the critical ability to use numbers and financial tools to make and analyze decisions. By asking questions such as: What is the return on investment on a particular project? Why can money not be spent, despite being a profitable organization? Leadership would utilize financial knowledge to make better-informed decisions and plan for the future of the organization.
Financial intelligence is a critical factor for leadership in understanding the organization’s financial result towards making better decisions. An organization whose leadership masters the art of financial knowledge encourages employees to practice the culture of financial intelligence and apply it in their everyday work decisions. An intelligent financial organization enjoys many benefits such as strength and balance, better decision making, and greater organizational alignment. “The intelligent finance organization of the future, and indeed of today, must go beyond its business-as-usual financial reporting and control role to become a value-adding provider of intelligence that the board and business units can depend on to make strategic business decisions” (KPMG International, 2013).
John Blackwell, the author of over 30 management books, found a direct link between organizations financial performance on investing changes in the work environment. Furthermore, the differences “between ‘expecting change’ and ‘having successfully change in the past’ is ten points smaller for financial over-performers compared to financial under-performing organizations” (Blackwell, 2012). The result is not because the over-performing organizations do not face challenges; instead, they anticipate change and can make provisions successfully to manage change.
- Leadership should learn and train employees to understand the key financial metrics that are important to each job role to create a high-performance organization.
“Intelligent people, when assembled into an organization, will tend toward collective stupidity” (Albrecht, n.d., p.4). It is not because of ignorance or lack of intelligence. According to Kerfoot (2003), “Creating organizations with a high IQ or creating organizations without the necessary intelligence guarantees success or failure of the organization.” It is important for leadership to put in place structures to enable the organization or unit approach and utilize the available data and insight in the organization. “Organizational intelligence, is the capacity of an enterprise to mobilize all of its available brainpower, and to focus that brainpower towards achieving its mission—is also a learning process, which includes the development of adaptable behavior using organizational memory, perception whilst it is also defined as the ability of organizations to take decisions about ordinary and extraordinary situations,” (IGI Global, 2018).
The Changing Dynamics of the Organization of the Future
Today’s organizations encounter a rapid shift of change in the workplace and the global business environment. This shift has affected the rules and practices in management and the employee’s work. As a result, the changing dynamics of the business world, both local and global leaders must change their mindsets about their organizations, and employees to survive and remain successful. Those who fail to shift face elimination.
Disruptive change in the business environment is not new. In the 1980s, the organizations and people were able to adapt to the emergence of IT industry growth, automated teller machines, and online systems by acquiring new skills and new jobs. These changes are not only limited to technology but also affects society and demographics. According to 2017, Deloitte Global Human Capital trends report “Technologies such as Artificial Intelligence (AI), mobile platforms, sensors, and social collaboration systems have revolutionized the way we live, work, and communicate” (Deloitte University Press, 2017). Organizations have to be redesigned to change their strategy, structure, hiring process, capacity development, and talent retention to sustain the rapid change in the global business world. A study by McKinsey Global Institute “Consumer have largely gone digital, the digitization of jobs, and of tasks, and activities within them, is still in the early stages—most industries have yet to digitalize their workforces” (De Smet, Lund, and Schaninger, 2016).
The Requirement of the Future Organization
Deloitte Global Human Capital 2017 trends report identified ten required areas of the organization of the future:
The Organization of the Future: Arriving now
The executives have determined that building an organization is one of the most critical challenges. Ninety percent of respondents rated the problem as essential or very important. Digitalization has made it compulsory for organizations to adopt a faster approach to support rapid learning and aid in the career path of their employees. Organizations have to be the redesign for speed, agility, and adaptability to compete in the global business world. Successful organizations operate empowered networks, harmonized through culture, information systems, and talent agility. Flexibility provides a premium role as the hierarchical structures are replaced with a network of teams who promote self-actualization in their tasks. High performing network of groups assembled to work on new a project on product or service, share information transparently with different areas of specialization and a standard value and culture. The team disbanded on completion of project work to move on to the next project.
Example, a leading North America bank embarked on the design of a new way to offer a faster way to support and deliver solutions to its customers. The bank formed a network of cross-functional teams that comprised up of developers, coders, business analysts, and user design experts to come out with solutions. The team worked in one area, and on completion, redeployed to the next new project. The result increases in the speed of development.
Careers and Learning: Real-time, all the time
Organizations of the future must offer continuous learning and development. It allows the Human Resource to empower employees to build on their skills real-time at their own pace towards a dynamic career improvement. Traditional learning process replaced with newer technologies through digital online learning and mobile apps that provide curated content, and video learning. Companies such as Nestle, Dell, as Visa utilize their corporate university for collaboration, leadership development, and cross-functional innovation for their employees to develop their dynamic careers.
Talent Acquisition: Enter the cognitive recruiter
It has become the third most crucial task organizations encounter. Recruiters and organizations utilize the social network, analytics, and cognitive tools in sourcing and recruiting talented people with the perfect fit for the job, team, and organization. Candidates are on the lookout for companies that offer attractive employment. Example, Dell’s Global Talent Brand, and Tools team launched a job search site that consisted of blog posts and videos highlighting Dell’s work environment and employees work experience; as well as posted to the YouTube channel and other employment-related sites.
The Employee Experience: Culture, engagement, and beyond
Organizations are changing their perspectives to concentrate on employees’ workforce experience through a personal journey, understanding their wellbeing and welfare needs. The workplace has to be redesign to fit in with the new system by incorporating design thinking to improve and enrich employee experience that results in a purposeful, productive, and a meaningful place to work. Example, Apple has designed a work environment called the work campus that is beautiful, personalized, with different places to eat, collaborate, exercise, and work together.
Performance Management: Play a winning hand
There are new approaches to performance management that emphasize on continuous feedback and coaching for performance. Employees want to give and receive feedback on their work activities leading to increased productivity and change in corporate culture.
Leadership Disrupted: Pushing the boundaries
The focus is to have future leaders that are young, agile with digital technology competency that can work and function with teams in running the organization. Such leaders must also know and understand how to handle millennials who want opportunities, mentoring and development. “This type of leader must understand how to build and lead teams; keep people connected and engaged; and drive a culture of innovation, learning, and continuous improvement” (Deloitte University Press, 2017, p.78).
Digital HR: Platforms, people, and work
Digital technology is taking over space in the work environment, as such, organizations have to develop digital workplaces and deploy technology to drive the work process. It involves the deployment of a vast variety of tool to build the future digital organization, workforce, and workplace. According to the 2017 Deloitte survey report, fifty-six percent of organizations are redesigning the Human Resources programs to take advantage of the digital and mobile tools. Fifty-one percent are in the process of reshaping their organization for digital business models, while thirty-three percent are utilizing artificial intelligence to drive Human Resource process.
People Analytics: Recalculating the route
It involves the utilization of people analytics to support operations, management, talent acquisition, and financial performance.
Diversity and Inclusion: The reality gap
The new focus for the executive is on diversity and inclusion in the workplace to distillate on accountability, data, transparency, and process.
The Future of Work: The augmented workforce
Organizations no longer focus just on the regular tradition workers in place. Instead, it includes freelancers, independent contract workers, and crowds. Robotics, artificial intelligence, sensor, and cognitive computing have added a new dimension of employment. These new technology and software are forcing a change in the redesign of jobs in the workplace due to automation.
The Design Tool for the Organization of the Future
“Organization design is the deliberate process of configuring structures, processes, reward systems, and people practices and policies to create an effective organization capable of achieving the business strategy” (Galbraith, Downey, and Kate, 2002, p.2). The first step in the design of the organization of the future is to determine and identify the characteristics of the organization. Examine the current state of the organization and analyze both the internal and external environment.
To have an organization that can quickly adapt to the rapid change in the global business environment, the organization has to be designed to have the ability to swiftly and regularly be changeable or reconfigurable. Weingarden (2011) noted, “The art of organizational design is assessing the essential aspects of the environment and their meaning for the organization’s future.” Galbraith’s Star Model organizational design tool is a framework that includes five major components – strategy, structure, processes and lateral capability, reward systems, people practices. An organization is useful when all the five components are in alignment.
The strategy is an organization’s blueprint that set the purpose and direction it takes such as vision, mission, short-term and long-term goals. It determines how resources are utilized to meet the needs of the market and shareholders. It is “an integrated set of choices that uniquely positions the firm in its industry so as to create sustainable advantage and superior value relative to the competition” (Lafley & Martin, 2013, p. 3). The leadership team is responsible for guiding the organization to embrace the strategy towards the achievement of set goals.
The organizational structure shows the line of power and formal authority that consists of organizational components, their relationships, and hierarchy. “Departments are formed around functions, products, markets, or region—configured into a hierarchy for management and decision making” (Galbraith, Downey, and Kate, 2002, p.3). It provides understanding and assigns roles and responsibilities for each employee, units, departments, and relationship as seen in an organizational chart.
Process and Lateral Capability
Process and lateral capability involve the “interpersonal and technological networks, team and matrix relationships, lateral processes, and integrative roles that serve as the “glue” that binds the organization together” (Galbraith, Downey, and Kate, 2002, p.4). Gareth Morgan made a metaphoric reference in his book ‘Imaginization’ to the umbilical cord of the Spider Plant as “represents the flow of resources and values that can be used to integrate the whole organization,” (Morgan, 1997, p.70). Process and lateral capability allow the organization to recruit the right people with the ability to work together to resolve conflicts, generate opportunities, and swiftly manage challenges.
The reward systems “help align individual behaviors and performance with the organizational goal” (Galbraith, Downey, and Kate, 2002, p.4). Employees’ behavior on how to complete assigned job tasks is influenced by the organization balanced scorecard and performance appraisal system. The reward and recognition system can be either intrinsic such as opportunities for growth; or extrinsic where profit sharing, plaques, or certificate presentation.
People practices “represents the collective human resources (HR) practices that create organizational capability from the many individual abilities resident in the organization” (Galbraith, Downey, and Kate, 2002, p.4). The strategy of an organization defines the various forms of skills, competencies, and other required capabilities for employees and managers. The Human Resources principal responsibility is in hiring the right people that fit in with the organizational values and culture. Policies aligned to build in employees’ behaviors and mindsets that can quickly adapt to changes in a reconfigurable environment.
In today’s business world, changes are happening at a faster rate in the technological environment, employee work skills, and customer needs. This wave has affected the rules and practices in management and the employee’s work. Additionally, events such as starting a new company or division, an organization plan for growth, a change in leadership or management, change in strategy, changes around the organization, a major in the external environment, and non-performance of the organization can trigger a need for organizational redesign. The change in dynamics has set leaders to adjust their mindsets about their organizations, and employees towards innovation and adaptation to new situations in attaining their business strategy to survive and prosper. It processes, reward systems, and people practices and policies to create an active organization that can take advantage of market opportunities. Those who fail to change face elimination.
As C-Suite leaders, you should take into consideration the following steps in the redesign of the future organization:
- Know how to combine good strategy with the right organizational structures and capabilities to strengthen agility, coordination, and flexibility.
- Understand the power of an aligned organization in decision making by putting in place a robust human resource systems, performance measurements, and rewards systems that would attract talents, develop, motivate, and retain employees.
- Develop collective proficiency in asking the right questions, making an informed decision during implementation by involving the needs of the business and the employees.
- The redesign of the organization should be a participative process that involves different levels of employees in identifying more options and making a decision. It results in the avoidance of conflicts, generates overall acceptance and commitment to outcomes to the new shape of the future organization.
Cultivating an Entrepreneurial Environment in Organizations
Organizations are failing people because they are not innovating! Without innovation, organizations do not stand the chance of survival for they would wither and die. The market is changing due to technology, customers expect and want more, and competitors pose a threat to your business because they are producing a more enhanced version of your products or services. How can we make the organization receptive to innovation, want innovation, reach for it, and work for it? Organizations have to feel the sense of the innovation spirit as the fabric of their existence and success, anything less leads to failure in the organization. As such, the innovative mindset must be at the core of the organization and leadership role.
Entrepreneurial organizations start with the kind of innovative culture, the leadership wants to embark on and practiced by all employees in order to develop entrepreneurial competencies. In a paper presented by the Organization for Economic Co-operation and Development (OECD) at 2018, SME Ministerial Conference on Developing Entrepreneurship Competencies stated, entrepreneurial competencies provides agility to change which “can be developed through entrepreneurship education and training that focus on promoting an entrepreneurial mindset and behaviors.” The general understanding is that entrepreneurship requires only creativity and flows naturally. Entrepreneurship requires more than being creative and being natural, rather it requires learning but more especially hard work. Peter Drucker in a book Innovation and Entrepreneurship wrote, “Entrepreneurial businesses treat entrepreneurship as a duty. They are disciplined about it…they work at it…they practice it.”
Entrepreneurial Competence in Organizational Growth
Organizations need entrepreneurial competencies to move forward and grow successfully. Organizations that have a high entrepreneurial competence level have a higher success rate in the formulation and implemental of robust strategies. They are well prepared to transcend from one phase of development to the other and can withstand any obstacle. Organizations need the following three types of entrepreneurial competencies: employee personal competencies, workplace competencies, and industry related competencies.
Employee personal competencies also known as soft skills are personal attributes required for satisfactory daily job performance. These competencies include interpersonal skills, strong initiative, ambition, adaptability, and flexibility, a willingness to take risks, and willingness to learn new things.
Workplace competencies represent employees’ ability to function effectively within the organization in the application of knowledge, skills, attitudes, values, and behaviors. These competencies include the following creative thinking, problem-solving and decision-making, networking, planning and organizing, business fundamentals, computer skills and technology, and customer focus.
Industry related competencies are the building blocks that support the development of an agile workplace. These competencies include the following principles of entrepreneurship, financial management, innovation and invention, business operations, planning, marketing, and risks assessment and management.
Cultivating the entrepreneurial culture requires continuous effort by the leadership to communicate the value of adhering to the adhocracy culture from top to bottom of their organizations. Leadership has to set the tone, reward hard work, and successful innovative project implementation, and encourage an open flow of ideas. The OECD paper stated, “Entrepreneurship competencies combine creativity, a sense of initiative, problem-solving, the ability to marshal resources, and financial and technological knowledge.” It is essential for organizations to learn and develop relevant entrepreneurial competencies and skills as it affects the organization’s effectiveness. Additionally, it determines the entrepreneurs and organizations’ success and competitiveness in the marketplace.
- Provide training opportunities and encourage a learning environment.
- Make available the necessary financial resources available to encourage the spirit of innovation.
Does your organization value innovation for the future?
The Outlook of a Successful Leader
Leadership is not an easy task more especially in today’s ever-changing business environment. Most of their time is spent on decision-making, resolving conflicts, anticipating problems to solve both internal and external that could affect the organization. To be successful, leaders must work hard in mastering the right aptitude to remain relevant. These set of talents include emotional intelligence, innovative intelligence and creativity, strategic intelligence, financial intelligence, organizational intelligence, and entrepreneurship.
The act of leadership requires a more profound intelligence in every decision and action, about company operations, processes, employee matter, products or services development, relationship with customers or competitors, as well as the organizational growth.
Leadership must understand the organization’s internal and external strengths and weaknesses, understand the relationship between different data for informed decision making, detect opportunities for innovation, and cost reduction and optimal deployment of resources.
As a future thought leader in management consulting as a result of the newly acquired knowledge from the doctoral program in business administration, the firm will assist clients in leadership positions in their respective organizations to achieve a change in mindset leading to excellent organizational performance and growth. These changes involve the development of leadership competencies that can leverage opportunities to adjust, create, and innovate their products or services to remain or stay ahead of the competition. It involves enabling an environment of employees that are motivated and nimble in today’s ever-changing business environment.
Leadership development allows companies to do four things that drive sustained success (Center for Creative Leadership, 2018): Improve bottom-line financial performance, attract and retain talent, drive strategy execution, and increase success in navigating change.
Do you have the qualities of what it takes to be a successful leader? You can develop the qualities of leadership in order to build yourself and a successful business through leadership development programs or participating in mentoring programs or self-learning. In addition, organizations must be able to identify potential leaders to develop their traits to become successful future leaders. What do you think?
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