Leadership and Decision Making

We associate leadership in business and politics with making good decisions. When someone is appointed or elected to a senior position, we effectively authorize them to make decisions for us and, naturally, we expect them to make wise ones. We want them to make choices that serve our interests and those of our organization, state or country.

This focus on decision making, however, yields a very narrow concept of leadership, one that results from our emphasis on being at the head of a group. Decisions are really only made by executives or managers. Leadership is an occasional act, like creativity, not a role and it is based on informal influence. Only management is a position of authority over people.

Why Leadership is not a Role

A great example of leading conceived strictly as informal influence is that of Martin Luther King. When his demonstrations led the U.S. Supreme Court to rule segregation on buses unconstitutional, his actions moved a public organization to act over which he had no formal authority. We also talk about market leadership or league leading teams in sports. There is also leading by example and promoting new products to your boss, what could be called bottom-up or thought leadership. None of these instances entails being in charge of those who follow, formally or informally. These are examples of pure influence, not decision making, which requires formal authority.

The key point here is that a general account of leadership, one that covers all the diverse instances referred to above, must restrict itself to the notion of “showing the way.” This ranges from merely setting an example to aggressively challenging the status quo. Al Gore, for example, is having a leadership impact on people all over the world, none of whom report to him. The impact of his influence has nothing to do with him making decisions for a group.

Why it Matters to Reject the Narrow View

By associating leadership with decision making, we restrict this crucial concept to people who have formal authority over others. This disempowers everyone else. The truth is that everyone can lead by promoting a better way of doing things, even on small, local issues like how best to serve a customer. You can lead your boss by arguing for a better way of processing some data or by setting an example for colleagues by conducting yourself with more integrity than them.

Why we Acquiesce in the Narrow View

We not only associate leadership with being in a position of power over us, but we have a psychological tendency to see leaders as father figures. This is natural enough as it is comforting to do so, but it amounts to abdication on our part. Also, this view is very outdated, counterproductive and dangerous in our knowledge driven age. Today, the power to lead is shifting to the power to generate and promote new ideas. Business has become a war of ideas and less of a personality contest. This is especially true in high tech industries where executives now advocate what they call “evidence based” decision making. This is a direct call for leadership based on solid knowledge rather than stirring speeches based on mere opinion. We are starting to prefer content over style, hence the slogan “content is king.” To compete effectively, we need everyone thinking and showing leadership. Also, to fully engage organizational talent, we need urgently to rid ourselves of outdated concepts and theories.

What is Management?

Managers occupy formal roles in organizations. They are charged with the responsibility to get things done as profitably as possible through people and other resources. They are like investors, but they are also catalysts, coaches, facilitators and nurturers of people. The old fashioned idea that managers are mechanically controlling needs to be ditched. Managers make decisions, like any other investor, to get the best return on the investment of all resources at their disposal.

Of course, managers can also occasionally lead. The key point is that they can’t monopolize leadership for the simple reason that no one has a monopoly on good ideas. In conclusion, whenever executives make decisions they are wearing a managerial hat, not acting as leaders.

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