As we continue to move toward a post-pandemic world, there is a critical question around how a company's characteristics impact leadership development.
Business literature, to date, has failed to provide a comprehensive framework that incorporates all the internal resources that can help or hinder how leaders are developed. What’s more, there is a gap in the literature when it comes to examining the implications of these specific company characteristics.
With this in mind, I conducted research with 48 executives in North America, across a range of industries, to better understand the factors influencing leadership development. Many agreed that while leadership development has become a focal point for their organization, it has not been aligned closely enough with internal resources to enable it to drive the organization’s success. Following my discussions - which took the form of telephone interviews - I found that leadership development is heavily influenced by the characteristics of organizations themselves in five specific areas: structure, culture, strategy, intercompany social networks, and stakeholder orientation.
THE AREAS THAT CAN AFFECT LEADERSHIP
Corporate structure. Leaders seek to inspire their followers to generate new solutions and create a better environment. The executives I spoke to suggested that a highly centralized structure has a negative impact on creative leadership, while decentralization positively contributes to leaders developing a more innovative milieu.
Decentralized structures play a crucial role when it comes to facilitating the exchange of ideas and the implementation of more innovative solutions. This is because they empower decision making at all levels of the organization. Highly formalized structures are also more bureaucratic, which hinders the development of leadership that aims to transform existing situations and build a better environment.
Corporate culture. When I asked the executives how corporate culture can work best for them, they argued that trust is an important component of a collaborative culture, as it helps to develop and maintain organizational communication.
From a cultural perspective, collaboration and trust are both critical aspects of leadership development, since they help leaders to develop relationships with their subordinates. A leader’s ability to build a more innovative environment is also highly dependent on the extent to which their subordinates trust them. Hence a corporate culture that instills trust in subordinates enables leaders because it mobilizes their followers’ support for the leadership vision. Distrust, on the other hand, impairs leadership development.
Corporate strategy. Another priority for executives was corporate strategy, encompassing analysis, defensiveness, proactiveness, and planning for the future. The aim of analysis is to find the best solution for solving corporate problems or achieving objectives through the assessment of various options. Future planning contributes to a leader’s ability to develop a more future-oriented vision for their organization.
I asked the executives how they felt about these two approaches. They responded that the strategic aspects of both analysis and future planning may have a positive impact on leadership development. In fact, these approaches help executives to develop a shared long-term vision for the future. Moreover, analysis creates more knowledge, which can improve leadership effectiveness through generating innovative solutions to address both organizational problems and strategic development. Every executive I spoke to mentioned that leaders’ effectiveness is improved when they take a proactive approach that searches out better strategic initiatives in the business environment. Thus, corporate strategy is positively related to leadership development.
Intercompany social networks. The executives stated that intercompany social networks (social networks that include peers within different organizations) improve leadership effectiveness by nurturing a more innovative environment. They argued that intercompany social networks positively influence leaders’ views and encourage them to further develop their relationships with subordinates. They also noted that intercompany social networks can positively contribute to leaders effectively empowering their followers. This may be due to companies that encourage intercompany social networks also tending to be more capable when it comes to promoting effective learning.
Stakeholder orientation. Stakeholder orientation is another important aspect of leadership development in the post- COVID-19 world. By definition, stakeholder orientation encourages leaders to adopt a more comprehensive vision that incorporates stakeholders’ attitudes. Also, when leaders have stakeholder orientation, they can propel knowledge exchange with stakeholders themselves.
The executives argued that a higher degree of innovation results when organizations exchange more knowledge with various groups, including stakeholders. At the same time, the exchange of knowledge can have a strong influence on learning within organizations. Knowledge exchanged with various stakeholders may help leaders to identify better opportunities in the current business environment.
Leadership development can help companies weather how the Covid-19 pandemic affected their businesses by producing leaders who can innovate and empower their teams.
Mostafa Sayyadi helps companies to succeed by improving the effectiveness of their leaders. He has contributed to numerous business publications and is co-author of Post-Pandemic Recovery.
This article was first published in our CMC Quarterly Business Journal.
