Rummaging through my in tray, I came across some interesting research by the Hay Group. It claimed that poor working climates are costing the UK financial services industry a staggering £8.5bn every year in lost profits.
It went on to say that as much as a third of an organisation’s business performance is dependent on a positive working climate and concluded that only 20% of finance executives create a high performance climate, according to their employees. Apparently, a lowly 17% manage to generate an energising environment. It gets worse, 46% actually create a demotivating environment for staff.
If ever there was a sector under the cosh, it has to be financial services; one would have thought that there was some low hanging fruit for them to pick here.
The crazy thing is that it’s not that expensive, in the grand scheme of things, to address some of these issues. Development programmes for leaders can make them more effective communicators, show them the impact they are having on culture and contrast this with the impact they would like to have. A coaching programme can then be put in place to bridge the gaps.
What I find really interesting is that both effective and ineffective leaders tend to want a similarly constructive impact on those around them. It’s an issue of leadership style and behaviours which, fortunately, can be learned. And the outcomes are energising for all.
Now I am not claiming that leadership development will rebuild the balance sheets of financial services organisations, but the resulting performance gains will certainly improve effectiveness, efficiency and morale.
Mike West
www.novaconnection.com
Peter Drucker famously said that management is doing things right; leadership is doing the right things. It can be tough fathoming out what the right things are, particularly in difficult times such as these. For example, is it about hitting key performance indicators at the exclusion of everything else? Maybe it’s playing safe and doing everything “by the book”? Perhaps the trick is to outperform your colleagues?
Drucker also said that leadership is not magnetic personality — that can just as well be a glib tongue. It is not ‘making friends and influencing people’ — that is flattery. Leadership is lifting a person’s vision to high sights, the raising of a person’s performance to a higher standard, the building of a personality beyond its normal limitations.
It’s the idea of raising a person’s performance which I find compelling. There’s a win-win in that – a bottom line benefit for the organisation and self-development for the individual. But raising a person’s performance can translate into management by spreadsheet – an obsessive focus on KPIs. Although KPIs are really important to the business they frequently have blind spots; there is a danger that they overlook the people dimension – the building of a personality beyond its normal limitations.
This is the point where managers often get uncomfortable; mmmm, the people dimension, that’s all fluffy bunny, right? Wrong! This is where real performance gains are to be found which read directly to the bottom line.
So why is it that managers struggle with the people dimension and fail to become leaders? Getting their heads around this challenge can be genuinely difficult, which is where some kind of model or framework can be helpful – particularly when it provides real insight. I’ve found the Human Synergistics Circumplex model to be a revelation for many managers. It’s as if the scales are lifted from their eyes as they discover the importance of achieving a balance between task and people, and of building a constructive culture as opposed to a defensive one.
So this is my interpretation of doing the right things – leadership which raises the bar while supporting and developing individuals. But for managers to become leaders they need some development too. This is where programmes based on world class tools such as Leadership/Impact can make a real difference.
Mike West
www.novaconnection.com