‘What Makes a Successful Leader?’
Sandra Watson, Rachel Chandler and Janice McMillan
Business School
Edinburgh Napier University
Craiglockhart Campus
Edinburgh
E14 1DJ
Corresponding author:
Sandra Watson
s.watson@napier.ac.uk
0131 455 4309
Leadership and Management Development: Working Paper
Key Words: Leadership; Success; Meaning; Measurements; Rewards
‘What Makes a Successful Leader?’
Key Words: Leadership; Success; Meaning; Measurements; Rewards
Abstract
This research offers an insight into the meaning of leadership success in different
organisational contexts, through examining how organisations identify those who
have the potential to lead, and how success is measured, valued and rewarded. It
investigates the influence that measures and rewards have on leadership practices
and behaviours. Finally, the research highlights key leadership challenges faced by
organisations in Scotland.
Research Background
Leadership is crucial to the supporting of sustained productivity growth,
competitiveness and prosperity (www.skillsactive.com 05/05/08). At senior levels in
an organisation, the ability to adapt, to make decisions quickly in situations of high
uncertainty, and to steer through change is critical, but understanding on the
characteristics of and influences on successful leaders is limited. What value is given
to leadership success and how is this measured in different organisations? This
research endeavours to answer this question, to aid understanding of leadership in
different contexts.
This work builds on research in the areas of leadership and management
development carried out in the public and private sectors (Alimo-Metcalfe, 1998;
Alimo-Metcalfe and Lawler, 2001). Public sector organisations have been subject to
changes that are transforming them from traditional administered bureaucracies to
outward-facing, managed, service organisations (Ashburner et al., 2005). Central to
this shift has been the embodiment of concepts associated with the private sector,
like Best Value, internal customer service and quality management, leading to
greater managerialism and privatisation within the public sector (Pollitt, 1993;
Wettenhall, 2001). The extent to which these have influenced leadership approaches
and practices is less clear. This research explores notions of leadership success in
the sector in which leaders operate.
Literature Review
What makes a leader successful? It has been suggested that leaders need certain
leadership competencies, such as resilience, intuition and honesty, in order to be
successful (O’Brien and Robertson, 2008; Tourish et al., 2008). However, it has also
been questioned whether simply having key competencies is enough to guarantee
success (Kirkpatrick and Locke, 1991; Hollenbeck et al., 2006). Other factors may
also influence success, such as the style of leadership adopted (Browning, 2007) and
the context in which they lead (Alimo-Metcalfe et al., 2007). There are also
differences in perceptions of what constitutes leadership success, especially between
the public and private sectors (Hooijberg and Choi, 2001).
Early identification of potential leaders is important so that organisations can develop
and nurture a larger pool of leaders for the future (Bernthal and Wellins, 2006).
Effective succession planning can be the first step towards building such a pool of
strong leaders, followed by an assessment of leader strength and development
needs (ibid). Bernthal and Wellins (2006) argue that a cycle of assessment,
development and talent deployment will ensure long-term business success.
However, it has been argued that some methods of identification, such as appraisal,
can be biased, unreliable and subjective (Alimo-Metcalfe and Lawler, 2001).
Alternative methods include the identification of key competencies, self-selection and
the use of leadership development programmes and personal development plans
(Effron et al., 2005; Hill, 2008; Bernthal and Wellins, 2006).
Since a link between leadership strength and organisational performance has been
documented frequently, organisations should have measures in place to track the
progress of their leaders (Bernthal and Wellins, 2006). In order to assess a leader’s
success, it may be more appropriate to measure an organisation’s success, rather
than an individual’s (Edmonstone and Western, 2002), especially as leaders do not
live in isolation of their organisational setting (Hooijberg and Choi 2000). Suggested
outcomes of effective leadership include organisational growth, innovation (Balkundi
and Kilduff, 2006), superior financial results, increased productivity (Effron et al.,
2005; Alimo-Metcalfe and Bradley, 2008) and a more motivated and committed
workforce (Alimo-Metcalfe and Bradley, 2008).
Research suggests that it is important for an organisation to value all its employees,
as those who are respected and listened to will have greater job satisfaction and
commitment to the organisation, resulting in greater productivity (CIPD, 2002). This
will be reinforced if a high level of trust exists, if communication is good, and if
realistic expectations are formed, highlighting the importance of people management
skills (ibid). However, the literature reveals that organisations often value quantifiable
behaviour, such as the ability to make a profit, more than interpersonal skills
(Bernthal & Wellins, 2006; CIPD, 2002). Consequently, rewards for successful
leadership tend to be based on behaviours that are easy to quantify (CIPD, 2002).
Successful leaders are often given financial rewards, such as bonus pay (Kulich et
al., 2007) or promotion to a position with a higher salary, with the aim of attracting
and retaining high potential employees (Piansoongnern et al., 2008). However, it has
been argued that how you pay a leader is more important for success than how much
you pay them (Jensen and Murphy, 1990). There are also vast differences in the
ways in which leaders from the public and private sectors are rewarded financially
(ibid). Furthermore, it has been suggested that leaders should be rewarded with
development opportunities and should be nurtured if organisations are to retain their
leaders and overcome challenges (CIPD, 2002; Silva and Sheppard, 2001).
According to Melymuka (2007, cited in Piansoongnern et al. 2008), career planning
and development are the most effective factors in motivating talent. Moreover,
leaders should be rewarded for carrying out mentoring and coaching activities as this
would encourage the transference of knowledge and skills, and promote commitment
(Piansoongnern et al. 2008). It is also important that organisations find ways of
creating a culture that values leadership, as devalued leadership can prevent
individuals and organisations from reaching their full potential, deter others from
taking up leadership positions, and perpetuate a culture of blame and conflict (Bolton,
2004).
A major leadership challenge identified in the literature is dealing with and adapting
to change, such as globalisation and technological innovation (Friedman, 2005).
Roles within organisations are also changing and leaders need to adapt their
leadership style accordingly (Bickerstaffe, 2008). Some have argued that neither
leaders nor organisations are prepared for such changes (O’Brien and Robertson,
2008; Edmonstone and Western, 2002; Bernthal and Wellins, 2006). Some
organisations risk having a shortage of leadership skills (Alimo-Metcalfe and Lawler,
2001) and losing competitive advantage (O’Brien and Robertson, 2008) as a result of
using old models of leadership. There are also barriers to effective leadership
development, including a lack of time and difficulties in applying learning (Tourish et
al., 2008), and barriers to effective organisational performance, such as a lack of
innovation (Christensen et al., 2008) and purpose (Montgomery, 2008).
This literature review has brought to light a number of research questions:
What are the perceptions of successful leadership and how do they vary
between the public and private sectors?
How do such organisations identify leadership potential and measure success,
and how can such methods be improved?
What values do organisations place on leadership and how do they reward it?
What are the impacts of such value and reward?
What challenges do leaders face and how can such challenges be overcome?
Research Methods
An interpretive research approach was used to gain a greater understanding of lived
experiences. A convenience-based purposive sample of organisational leaders was
adopted to select leaders within organisations from both public and private sectors of
the Scottish economy. Semi-structured qualitative interviews with leaders from 30
organisations across 10 sectors * in Scotland were undertaken to explore how
success in leadership is perceived, valued and measured. The content of the
questions in the interviews was informed by the literature review and a pilot study
with three leaders. A thematic analysis of the recorded interviews was conducted
with the intention to develop categorises of leadership approaches. Discussion
centres on similarities and differences across sectors to expose a greater
understanding of the meanings of leadership success, derived from the data.
Preliminary Findings
A preliminary analysis of the interviews conducted so far shows that the following key
competencies were most commonly considered to be important in the definition of
leadership: listening skills, having vision, honesty, and gaining respect. Almost half
of the respondents felt that ability to achieve goals was a key leadership trait, while
just less than a third thought that the desire to develop others was another key trait.
A few organisations used competency models or frameworks to define leadership.
Nearly half of the organisations stated that leadership was distributed throughout the
organisation, while just under a third indicated that leadership was situational. A few
organisations, most of which were from the public sector, did not have a clear
definition of leadership.
*
Public – Central Government, Local Government, education, health, voluntary
Private – Manufacturing, finance, hospitality, professional services, retail
More than half of the organisations defined successful leadership as the ability to
meet business objectives and make a profit. Most of these organisations were from
the private sector. However, several organisations from both sectors felt that softer
skills, such as emotional intelligence, the ability to drive a team and valuing others,
were necessary for leadership success. The following traits were also thought to be
particularly important: trustworthy, confidence, and self-motivation. Almost a third
argued that leadership success was dependent on the context or situation that the
leader is in. A few thought that successful leadership is not purely confined to those
at the top of the organisation.
Development programmes and assessment centre were commonly used to identify
potential leaders, while appraisal and performance management were also
considered effective methods. However, almost two-thirds of organisations in the
public sector and one private sector organisation had no formal methods in place.
Nearly half of the organisations felt that their methods of identification could be
improved, as methods such as interviews and psychometric testing were thought to
be subjective and unreliable.
While measures of leadership success varied, performance indicators, staff retention,
appraisal, and profits/results were used most frequently, and more predominantly, in
the private sector. Over a third of the public sector organisations had no formal
measures in place.
Leadership was very highly valued by several private sector organisations because
they felt that successful leadership was essential for business success. A few public
sector organisations said that leadership was not valued, while a few felt that certain
types of leadership were more highly valued than others. It was thought that valuing
leadership encouraged role modelling and increased individuals’ confidence in their
ability to lead. Conversely, it was felt that not valuing leadership resulted in
individuals feeling devalued, isolated and detached from the organisation.
Many organisations considered a combination of public/private recognition and
financial rewards to be the best approach to rewarding successful leaders, as such
rewards were believed to help motivate and retain good leaders. Other rewards
included providing development opportunities, giving additional responsibilities and
offering promotions. A developmental reward focus on leadership was seen to
attract and retain the best leaders, allow leaders to become more energetic and
confident, and ultimately make the organisation more successful. A career-based
approach was also seen to have beneficial influences on leadership retention. A few
organisations from the private sector felt that sharing financial rewards between the
whole team encouraged team working and co-operation. Some also felt that
individualised rewards were more appropriate to meet individual needs. Almost half
of the public sector organisations were unable to give financial rewards, either due to
a lack of funding or because of criticism about public spending. A lack of rewards
was thought to have a negative impact on morale and discourage successful leaders
from joining/ and/ or staying with such organisations.
The majority of organisations, mostly from the private sector, used internal leadership
development programmes to develop their leaders, while just under a third from both
sectors used external programmes. A third of organisations, mostly from the public
sector, did not use formal programmes at all. Several organisations supported their
staff to gain professional qualifications and a few from the private sector included
coaching or mentoring in their leadership development programmes. Most
organisations said that leadership development had had positive impacts on both
leadership and organisational success. Such impacts include early promotion,
reduced labour turnover and increased profitability. However it was also pointed out
that it is difficult to attribute success solely to leadership development, as external
factors also play a part. Leadership development was met with initial scepticism and
a lack of understanding in a couple of organisations. It was also considered that it
could be difficult to apply learning to the workplace.
Finally, the most common key leadership challenges, both for individual leaders and
organisations, were adapting to changes, such as the economic climate, and keeping
motivation high. Other challenges included balancing leadership roles, dealing with
conflicts and succession planning. A few organisations did not have clear definitions
of successful leadership, and consequently struggled to recruit and develop the right
leaders and measure and reward success appropriately.
Conclusions
In redressing the research question What value is given to leadership success and
how is this measured in different organisations? the findings are summarised in
relation to the literature review. Although competencies were thought to play a part
in determining the success of a leader, other factors such as the situation were also
important (Alimo-Metcalfe et al., 2007). While there were differences in perceptions
of successful leadership between the public and private sectors, there were also
similarities initially suggesting that there is not such a clear distinction between the
two sectors (Hooijberg and Choi, 2001). The findings also show that although
methods for identifying potential leaders were generally thought to be effective, some
were thought to be unreliable and subjective, as supported by the literature (AlimoMetcalfe and Lawler, 2001). Furthermore, organisations that did not have a clear
definition of successful leadership struggled to identify, and consequently develop,
potential leaders, leaving leaders with less incentive to stay at the organisation. Such
organisations also struggled to measure and therefore reward leadership success,
leading to the same retention problems (Hooijberg and Choi, 2001). Leadership
definitions tended to be less clear in the public sector. Although financial rewards
were common in the private sector, many argued that other rewards such as
recognition and development were also important in terms of long-term motivation
and retention. More than a third of the public sector organisations did not reward their
leaders financially at all, supporting the argument that rewards vary between the
sectors (Jensen and Murphy, 1990). Finally, the findings support the assertion that
one of the biggest leadership challenges that leaders face is dealing with and
adapting to change. For the private sector the main challenge was dealing with the
changes brought about by the economic recession, whereas the public sector
organisations were faced with challenges inherent in growing and evolving
organisations (Bickerstaffe, 2008). This initial analysis reveals that there are distinct
differences between public and private sector understanding of and approaches to
leadership success.
The findings have implications for theory, practice and future research. These include
a lack of understanding around leadership success factors and influences in theory. It
would appear that the contingent nature of leadership is evidenced in practice, but
that leadership success is measured and rewarded differently across the
organisations researched in this work. Further research exploring how various
leadership success interpretations influence leadership behaviours and values as
well as a further research into understanding of leadership success would be
beneficial.
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