Leadership Mistakes and Misconceptions.

Given the underlying organisational structure (the 3 seats/spaces of shareholding, directorship and management) – and the potential conflicting roles that people play simply by being involved in a business on a number of levels – there are some very dominant problems with the way directors act in business. Some of these mistakes and misconceptions emerging for the problematic mindsets are;

  • The ‘Owner’-Manager/Director Dilemma – “It is my company I will do what I want”. This is the most common approach to running an organisation – for those in both shareholding and directorship – and especially so where this individual (or close knit group) started the organisation and built it up from scratch. Now at a certain level it does hold true, when an organisation is small and focused, does not employ a large base of people and while there will not be a major impact if it does not succeed this could even be the right attitude to have. But it needs to change as the organisation grows – directing a organisation is a bit like parenting – while a child is still very young while every decision and every action is taken on behalf of the infant, that infant pretty much goes where the parents go and does what they are doing. As the child grows so it becomes more and more independent of its parents and starts to set its own direction. Ultimately the growing adult starts to set and determine the direction they will take – and then they take it. In the same way as organisations grow so they tend to “take on a life of their own”. A growing organisation will outgrow its directors in the sense that the interests this organisation represents outgrow the interests of the directors alone. A growing organisation represents far more interests that just those of the directors – or even eventually of those of the shareholders. There is a growing responsibility to take into account the legitimate interests of all stakeholders in the organisation;

 

  • The “Just Do It and Hope for the Best” Approach, otherwise known as the “it is easier to ask for forgiveness than permission” mindset. This approach goes beyond the previous one in the underlying assumption that there is always a way out of a problem without onerous consequences. It is an attitude that pre-supposes the ability to control all aspects of a situation to some degree, or contract out this control to the appropriate person and ultimately avoid any negative consequence of any action. It could also be seen as the root of some level of corruption since others are seen as able to “clean up” a situation because of heir position or role – this is not far off paying someone to “clean” things up or “organise” things in a certain way. Directors are moving into an environment characterised by much higher levels of exposure and the consequences of decision making will be seen more clearly due to increased levels of organisational accountability and corporate transparency. It is better for directors to “get their ducks in a row” pro-actively in this environment than simply assume that everything is “fixable” after the fact;

 

  • I work “IN” my company but never “ON” my company. “IN work” = Operational Work; “ON work” = Strategic Work. One of the best analogies to illustrate the difference between “IN work” and “ON work” is the fundamental difference between the Architect and the Builder – the Architect is involved in conceptual and design – creating the image and feel and flow of a building before it even exists – this would be classic “ON work”. The Builder on the other hand implements the concept, delivers it on the ground, effectively, efficiently and within clear time-frames – this is “IN work”. Given that directors hold the twin responsibility (and accountability to stakeholders in a organisation) for strategy and governance – both roles that could be classified as working “ON” an organisation it is little wonder that these are so neglected. It is true that for most directors, especially those who are involved in technical delivery within a company, the main issue leading to this common mistake is that there simply is not enough time. Every growing organisation tends to also be constrained financially such that the proper delegation/”dispersement” of the “IN” work is not easily achieved – and so the “ON” work suffers. Aligned with the time issue however is also a knowledge issue – understanding what “ON work” entails, and how to implement it practically throughout a organisation – the skill of application. Together the time and knowledge/skill issues have created a recipe for confusion and unintended complexity in many organisations.

What challenges to you face in your company? What mistakes have you made and what misconceptions do you hold?

If we can diagnose these well we can solve/treat them.

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