Decoding leadership: What really matters….

New research from McKinsey suggests that the secret to developing effective leaders is to encourage four types of behavior.

Telling CEOs these days that leadership drives performance is a bit like saying that oxygen is necessary to breathe. Over 90 percent of CEOs are already planning to increase investment in leadership development because they see it as the single most important human-capital issue their organizations face…..

….A big, unresolved issue is what sort of leadership behaviour organisations should encourage. Is leadership so contextual that it defies standard definitions or development approaches?

McKinsey’s most recent research suggests that a small subset of leadership skills closely correlates with leadership success, particularly among frontline leaders. Using their own practical experience and searching the relevant academic literature, they came up with a comprehensive list of 20 distinct leadership traits. Next, they surveyed 189,000 people in 81 diverse organizations around the world to assess how frequently certain kinds of leadership behavior are applied within their organizations. Finally, they divided the sample into organizations whose leadership performance was strong (the top quartile of leadership effectiveness as measured by McKinsey’s Organizational Health Index) and those that were weak (bottom quartile).

What they found was that leaders in organizations with high-quality leadership teams typically displayed 4 of the 20 possible types of behavior; these 4, indeed, explained 89 percent of the variance between strong and weak organizations in terms of leadership effectiveness.

The 4 leadership behaviours that account for 89% of leadership effectiveness are:

  • Solving problems effectively. The process that precedes decision making is problem solving, when information is gathered, analyzed, and considered. This is deceptively difficult to get right, yet it is a key input into decision making for major issues as well as daily ones.
  • Operating with a strong results orientation. Leadership is about not only developing and communicating a vision and setting objectives but also following through to achieve results. Leaders with a strong results orientation tend to emphasize the importance of efficiency and productivity and to prioritize the highest-value work.
  • Seeking different perspectives. This trait is conspicuous in managers who monitor trends affecting organizations, grasp changes in the environment, encourage employees to contribute ideas that could improve performance, accurately differentiate between important and unimportant issues, and give the appropriate weight to stakeholder concerns. Leaders who do well on this dimension typically base their decisions on sound analysis and avoid the many biases to which decisions are prone.
  • Supporting others. Leaders who are supportive understand and sense how other people feel. By showing authenticity and a sincere interest in those around them, they build trust and inspire and help colleagues to overcome challenges. They intervene in group work to promote organizational efficiency, allaying unwarranted fears about external threats and preventing the energy of employees from dissipating into internal conflict.

McKinsey are not saying that the centuries-old debate about what distinguishes great leaders is over or that context is unimportant. Experience shows that different business situations often require different styles of leadership. They do believe, however, that their research points to a kind of core leadership behaviour that will be relevant to most companies today, notably on the front line. For organisations investing in the development of their future leaders, prioritising these four areas is a good place to start.

Here is a link to the article http://www.mckinsey.com/insights/leading_in_the_21st_century/decoding_leadership_what_really_matters