Are you the right boss for the times?

I caught up with an entrepreneur last Thursday night at the SmartCompany Awards. I congratulated him in his fast growth during a very difficult period. But he did not look that happy. He confided that he had a new problem. He had brought in a CEO two years ago to get the company through the difficult times and maintain profits. Trouble was, this CEO was not a good leader or innovator. “He’s wrong for the times,” he says.

He now has a focus on innovation, growth and opportunity. But his CEO, while steering the ship through some tough times, has lost some good people. He set very high goals, made tough decisions and people had trouble keeping up. To maintain the profits, projects were canned and R&D slashed.

I was reading the results of a new report out today called Transforming Leadership and Culture. It found that 57% of the 4,035 senior executives surveyed have such a negative impact on their staff. The report was done by a culture change consultancy, Human Synergistics and says over a quarter (26%) of managers take a highly conventional approach to leadership – encouraging staff to fit to the “mould” and follow rules, policies and standard procedures, even at the cost of new ideas and innovation.

Now, it is a fine line between setting up a culture, values, processes and procedures so that staff can follow the “rules” of the company when making decisions, and making a company culture so rigid and conservative that innovation is snuffed out.

The research found that in addition to encouraging conformity, some leaders also:

1. Drive staff to be oppositional, critical of others to gain status and to dismiss good ideas due to minor flaws (13%).
2. Champion perfectionism by asking people to set unrealistically high goals, focus on unnecessary details over the bigger picture and promoting overtime for face value, rather than necessity (12%).
3. Use power to motivate people, drive forceful and aggressive behaviour within the team, and build up power bases through controlling others (12%).

Managing director of Human Synergistics, Quentin Jones, says the impact that a leader – whether they’re a CEO or a line manager – has on the performance and productivity of their team is huge. He argues that the first step for all managers is to be aware of the way they manage and that to have a more positive impact on the team, organisational culture and profit levels, leaders must:

• Champion innovation – motivate others to approach problems with interest, creativity and integrity.
• Reinforce individual value – support professional development through offering opportunities for growth.
• Focus on achievement – encourage others to take on challenging but realistic goals, establish plans to achieve those goals and pursue them with enthusiasm.
• Promote positive relationships – ensure that the people within their teams are supportive of each other; sensitive to each other’s needs and offer positive, yet constructive, feedback.
• Lead from the front – show enthusiasm and champion the mission and vision of the company.

In my experience, the great entrepreneurs are successful because they have a positive impact on the team by doing all of those things. But the danger going forward is that the culture has changed in the last two years. It is a good time to review general managers, CEOs and line managers. Are they snuffing out innovation because they are still panicked about costs?

The entrepreneur who I chatted to last Thursday night was lucky. He has someone in the company who he can promote to the CEO position if needed, who has the attributes needed to lead in 2010. Do you?