Think HBR

The Cost of Short Lived Leadership

Take a look at the leaders in your organisation. Are they stayers?
Are their actions towards building a better future or simply responding to immediate needs?
In his book Good Business Mihaly Csikszentmihal said “more than anything else we need hundred-year managers at the helm of corporations.” Unfortunately, too many companies and business leaders, when faced with mounting financial and market pressures create a bunker like mentality, hunkering down to focus only on short term profits and providing no face-to-face time with staff, customers, community or investors.
It may be human nature to do so after all “what gets measured gets done” but for long term business success and sustainability what’s needed more than ever are solid relationships. Leaders must reengage with their long term vision and communicate, understand, and interact with all their stakeholders.
Daniel Goleman, expert on emotional intelligence says “After analysing 181 competence models from 121 organisations world-wide, we found that 67% of the abilities deemed essential for effective performance were emotional competencies.
Compared to IQ and expertise, emotional competence mattered twice as much.”
Goleman also found that feelings are contagious – positive even more so than negative. The mood of an organisation has a causal effect on everyone within it. Creating good “psychohygiene” therefore should be one of the key strategies of the leadership team, especially during difficult times.
Collaboration is the new competition. Creating an environment of collaboration and open communication during challenging times is critical for leaders and line managers. They should be spending as much time as possible interacting with employees, regular customers, investors and stakeholder representatives be it unions, politicians, or community representatives.
Fred Reichhold, Bain & Company consultant and author of The Ultimate Question, argues that companies that obsessively focus on employee and customer satisfaction create greater economic growth and reduced recruiting, sales and marketing costs. He can show that an increase in customer retention rates of just five per cent could increase profits by 25-95 per cent depending on the industry. He also showed that these companies typically grew their revenues more than twice the rate of their competitors.
Before you spend your next investment dollar on improving business processes, installing signage or a new software system, consider what investing in your people and on your relationship architecture could do to give you a long term competitive edge.
The only sustainable competitive advantage in the new modern economy you can have are the unique bonds of loyalty you create.
Heidi pic1 Heidi Alexandra Pollard

Heidi Alexandra Pollard is CEO of UQ Power.

She and her team help ambitious companies to power up their people and brand by defining what makes them unique – their UQ factor.