One Size Fits None: An Appeal for Better Leaders
According to Deloitte University Press, 86% of companies have identified developing new leaders as an “urgent” need. And upon closer inspection, it’s clear to see why.
Incompetency as a Norm
When it comes to managers’ performance, alarmingly, the norm seems to be incompetence. In a recent study, Gallup found that companies fail to choose suitable candidates for management roles a staggering 82% of the time. Now to be fair, there are not many qualified potential people to choose from in the first place.
In another report, Gallup revealed that only 1 in 10 people possess requisite management talents, such as the ability to build relationships that create trust, open dialogue, and full transparency. And of those who do end up becoming managers, their talent is seldom nurtured.
A survey by Career Builders found that a whopping 58% of managers receive little-to-no management training. Alas, most bosses aren’t necessarily good at making the people around them better. And how this plays out in workplaces across the planet is disheartening.
For instance, a Harvard Business Review study uncovered that 58% of people trust strangers more than their bosses. So arguably, they are more willing to let their children get into an Uber driven by a complete stranger than they are to let them work with their boss. In light of these findings, it’s no surprise that most employees—upwards of 80% according to some of the most comprehensive studies—are disengaged, looking for other jobs, and ditching traditional employment to pursue entrepreneurship.
Who is your Leadership Inspiration?
As it happens, the modern workplace is overrun by bosses who aren’t qualified to lead. Reflect on your career for a moment by thinking about the best boss you worked for, as well as the worst boss you worked for. Once you’ve visualized them, ask yourself: whose leadership style do you strive to emulate?
If you picked the best boss you worked for, then you have an innate understanding of the complex problem at hand, as well as its embarrassingly simple solution.
On one side, it’s heartening to see organizations worldwide upgrade from simple Corporate Social Responsibility commitments to more holistic and comprehensive Environmental, Social, and Governance commitments, as well as aspire to B-Corp status.
Glimpses of a positive-sum thriving future are visible through the cracks of the prevailing zero-sum failing system. A full year before we plunged into the chaos of the COVID-19 pandemic, Marc Benioff, CEO of Salesforce, made this urgent appeal to his contemporaries at the 2019 Business Roundtable Forum:
“The purpose of business now transcends shareholders. We need a reinvented system focused on employees, customers, communities, and the planet.”
Benioff believes that companies should use their power to advance meaningful causes. And chief among them is the fight against climate change. In doing so, he joins a small but rising list of industry captains—including Patagonia Founder Yves Chouinard, who made headlines for relinquishing his entire stake in the company to fight climate change—who speak up about the necessary structural changes required to stand a chance against the world’s most pressing issue.
So on one side, it seems that leaders have their hearts in the right places as far as environmental sustainability is concerned. But on the other, a peculiar problem is intensifying: organizations are living shorter and shorter lives. Consider that in 1958, the average age of an S&P 500 company was a healthy 61 years. But in 2023, that number is down to a mere 18 years.
In fact, McKinsey calculates that most S&P 500 companies will disappear by 2027. I suspect that this rate of decay has a lot to do with the aforementioned issue of bad bosses. As I wrote about extensively in my pandemic-inspired book, “Leadership, Reinvented,” during times of change and crises, people don’t “step up”—they actually “fall back” and “sink” to the level of their values, training, and preparation.
Given that most managers are incompetent and that our world is becoming increasingly volatile, uncertain, complex, and ambiguous, the problem becomes clearer: overwhelmed and incompetent bosses are reverting to and doubling down on a counterproductive style of management—a remnant of the early Industrial Revolutions, known in the leadership literature as “Dominance.”
Dominance-oriented leadership it’s a one-size-fits-all style of management which relies on force and intimidation to induce fear. Below are common traits of this leadership style:
- Highly Directive
Dominance-oriented leaders are inclined to enjoy giving orders, intimidating subordinates, overly relying on reward and punishment, and prioritizing the organization’s needs over those it employs. The one critical problem with this management style is that it doesn’t replicate.
And so, in the truest sense of the word, it’s an unsustainable approach to managing. After all, think back to the bad boss you visualized earlier—you’re actively choosing not to replicate their management style.
Caught up in Dominance cycles, most companies—whether on the S&P 500 or FTSE Eurofirst 300—haven’t committed to comprehensive measures to fight climate change, such as running net zero carbon operations. Staring into the abyss of time, afraid, the managers of these companies are making the grave mistake of prioritizing greater profits.
All the while, they’re exacerbating the very problem that will upend their business. Intimidation can beget compliance, but relationships based on Dominance are less stable. Getting out of unstable survival mode involves looking to the opposite approach to Dominance, namely, Prestige.
This style of management involves the sharing of expertise or know-how to gain respect. Prestige-oriented leaders are servant leaders who care about relationships with their team, avoid intimidation and coercion, strive to be role models, use soft power to influence subordinates, and create more organizational leaders. Below are common traits of this leadership style:
Benefits of Prestige-Oriented Leadership
Compared to Dominance, Prestige is more tedious to manifest, for it requires substantial tailoring to the needs of individuals. But the caveat is that of the two, Prestige is the only style that is widely and willingly replicated. In this way, it’s the only sustainable option. But putting aside the question of ease, Prestige is actually better for business.
A ten-year examination of stock market returns for the 20 best-ranked public companies on Glassdoor reveals that 60% have beaten the S&P 500, and 91% have had positive returns. And behold, Fortune’s Top 100 best companies to work at also outperformed the S&P 500 over the past decade. The top company, Adobe, beat the market by 9.5% each year and returned 1762% during this time.
And according to the American College of Occupational and Environmental Medicine, companies that promote a culture of health, safety, and well-being also outperformed the market by 2% per year, with a weighted return on equity of 264% (compared with the S&P 500 return of 243%). It turns out that exceptional places to work create outstanding returns for their shareholders. So while Prestige may be a more challenging path to the top, it’s absolutely worth doing.
Dominance or Prestige?
Are there situations where a Dominance-oriented leader performs better than a Prestige-oriented leader? Yes. A top-down, dominant approach can be efficient when a solid plan is in place, and a highly coordinated, unified effort is needed to deliver it.
A dominant leader can make each part of a company adhere to clearly defined actions, and can save time through quick and firm decision-making. But all this assumes that there is a healthy relationship between managers and employees, and that good communication and buy-in have taken place.
Which, as we know, is simply not the case in the modern workplace. One way to rethink the Prestige-Dominance dichotomy is as a permission-based blend—the privilege of successful Prestige orientation is the earned ability to switch to Dominance as the needs of the organization and its people change.
For Human Resources and Learning & Development professionals, the business case is clear. And it needs to be communicated to managers across the organization—potential managers, newly minted managers, and C-Suite alike: lead with Prestige. Early in my career, a mentor advised me that a leader’s true purpose is to “develop new leaders.”
A coordinated contingent of Prestige-oriented leaders is critical to navigating our world away from impending environmental catastrophe and toward a sustainable positive-sum future. And this global effort depends on every organization’s ability to develop new leaders.
Hamza Khan is a best-selling author, award-winning entrepreneur, and globally-renowned keynote speaker whose TEDx talk “Stop Managing, Start Leading” has been viewed over two million times.
The world’s leading organizations trust him to enhance modern leadership, inspire purposeful productivity, nurture lasting resilience, and navigate constant change.