[1.1.2] Why leadership matters

[1.1.2] Why leadership matters

Why Leadership matters

So why is leadership important? Why do we keep talking about it ? Because leadership is the kind of topic that keeps coming back. Everywhere. All the time. In our politics, our organisations, in our personal lives.
Why does leadership play such a big role? Why is it so important to us? And how does it affect us? In this chapter we will explore why we put so much value to ‘Leadership’ and how leadership roots itself in almost all aspects of our lives.

Impactful leaders

Our history is filled with stories of impactful individuals who left their mark on history, achieved admirable results, or inspired millions of people with a vision of the future.
From historic figures such as Gandhi, Martin Luther King, Nelson Mandela’s, and Winston Churchill's of this world, to modern day leaders like Barack Obama, Angela Merkel, and Malala Yousafzai - these individuals have shaped history through their leadership.
Some led nations through times of crisis, like
Winston Churchill
Winston Churchill ,
Charles de Gaulle
Charles de Gaulle , and
Franklin D. Roosevelt
Franklin D. Roosevelt during the Great Depression and World War II.
Others, like
Steve Jobs
Steve Jobs,
Bill Gates
Bill Gates,
Luciano Benetton
Luciano Benetton, or
Ingvar Kamprad
Ingvar Kamprad who revolutionized entire industries through their innovative leadership.
Mother Theresa
Mother Theresa demonstrated leadership through humanitarian work, while leaders like
Nelson Mandela
Nelson Mandela showed how leadership could transform nations through reconciliation and unity.
As humans we are drawn to leadership stories, we admire them for the things they have achieved. Sometimes to the point that we idolise them.
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Gandhi,
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Selma,
The Chancellor: The Remarkable Odyssey of Angela Merkel
 
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More examples of impactful leaders:
  • Marie Curie
    Marie Curie     - Pioneered research on radioactivity and became the first woman to win a Nobel Prize
  • Lee Kuan Yew
    Lee Kuan Yew     - Transformed Singapore from a third-world country to a global financial center /
  • Albert Einstein
    Albert Einstein     n - Beyond his scientific achievements, used his influence to promote peace and human rights
  • Florence Nightingale
    Florence Nightingale     Florence Nightingale - Pioneered modern nursing and hospital sanitation practices
  • Henry Ford
    Henry Ford     - Revolutionized manufacturing with the assembly line and made automobiles accessible
  • Muhammed Ali
    Muhammed Ali     - Transcended sports to become a voice for civil rights and social justice
But is this praise justified?
Do leaders really deserve that amount of credits for their achievements? Or are those achievements just inevitable consequences of human progress? Let’s explore this together.
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Reflection: Who are leaders that have inspired you? Why?


Associating leadership with (individual) results

Whenever something impactful has been achieved we are likely to praise the ‘excellent’ leadership efforts. It is very human to seek to give individual credit rather than seeing it as a collective effort.
Which makes sense. Leaders often have an enormous impact of the achieved results; so much so that we have started to automatically assume that the outcomes are the direct result of their leadership without considering the other factors at play.
And this belief is deeply ingrained in our cultural DNA. The notion that leadership is the primary force behind success or failure shapes how we structure our organizations, elect our officials, and even shape our personal lives.
And this can be observed in in many aspects of our society. We give support or public praise to political leaders. We award business leaders with significant financial incentives. Most organisations measure individual contributions in their performance management cycles (rather than team objectives). Sports results are often credited to individual players than the group as a collective.
On top of that we often hold leaders accountable to short term results, while study has shown that the leader’s impact is much more pronounced in the long term. Policies set by the national government often take years before they have a measurable impact on the economy, yet we often hold the current government responsible for the economy of today.
Removing the senior leaders from an organisation on the short term doesn’t change much, business will go on as usual. But on the longer term you will see that the organisation starts to lack direction and falls behind compared to their competitors.
Our tendency to overly associate leaders with success can also be found in the more operational teams. Imagine a team with several high-performing individuals and a mediocre team leader. It is not uncommon to see organisations acknowledge the team leader for the team’s performance, while if you would have removed the team leader the team may have achieved similar (and not unthinkably even better results).
We idolize leaders who achieve results, even when their actual impact on the effort has been minimal.
When attributing success or assigning blame, we often overestimate individual leaders' impact compared to their actual actions and decisions.
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Some examples of disproportionate rewards include:
  • Bob Iger returning as Disney CEO in 2022 with a significant compensation package, despite inheriting many of the challenges he's credited with failing to address in his earlier position as CEO from 2005 until 2020
  • Political leaders such as Barrack Obama who received prestigious awards and speaking fees for economic growth that was largely driven by broader market conditions or policies implemented by their predecessors
  • Tech CEOs like Jeff Bezos (Amazon), Elon Musk (Tesla and SpaceX) and Satya Nadella (Microsoft) received massive stock options during the 2020-2021 bull market, when their companies' growth was largely driven by pandemic-related market conditions rather than specific leadership decisions
Again by no means meaning to degrade the impact of leadership, but there are certainly times where we overstate their impact aswell.

We are quick to blame leaders

But it also works the other way around.
Whenever there is a problem, a crisis, or a negative outcome; you can be sure someone’s leadership is being questioned. And often rightly so.
After all, it happened on their watch and they should take some level of responsibility. Leaders are often receiving royal compensation for the position that they are in. Besides, they are at the helm of the ship and we look to them for direction, guidance, and decisions. Hence, having a leadership position comes with responsibilities and accountabilities.
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Examples of some leaders being held accountable:
  • The Boeing CEO David Calhoun stepping down in March 2024 after multiple safety incidents, including the Alaska Airlines door plug incident.
  • Mark Zuckerberg facing criticism and congressional hearings over Meta's handling of user privacy and social media's impact on youth.
  • Carlos Tavares (Stellantis CEO) receiving blame for the strategic shift towards electric vehicles and subsequent job cuts in 2024.
  • Roy Jakobs (Philips CEO) facing criticism over the company's handling of the sleep apnea device recall crisis in 2023-2024, leading to significant financial impact and loss of trust
  • Olaf Scholz (German Chancellor) facing public criticism in 2024 for Germany's economic slowdown and the handling of military support for Ukraine
 
But even when the leader in question had limited influence over the problem or the problem dates back to a time before the leader even arrived, their authority and position can challenged. We are expecting leaders to address systemic issues (even if they inherited them) and if they feel to take appropriate action we pressure them.
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Reflection: Is there a leader you have blamed in the past for certain results or actions? Why?


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Examples leaders being held accountable for things they had limited influence over:
  • Andy Jassy (Amazon CEO) shortly after being appointed receiving criticism for warehouse working conditions that were established long before he took over from Jeff Bezos and he had no influence over in his previous role as head of AWS (Amazon Web Services)
  • Pat Gelsinger (Intel CEO) being held responsible for Intel's manufacturing delays and competitive position, despite these issues emerging mostly before his 2021 appointment (he left Intel in 2009 to be the CEO at VMware before returning to intel in 2021)
  • Joe Biden facing criticism over inflation and economic policies in 2024, despite many factors being outside direct presidential control and some issues originating during previous administrations.
As a human species we tend to strongly correlate the ‘current’ outcomes or events to the respective responsibility and influence of a leader, even when that might not always be fair (not saying that is the case for any of the examples mentioned above). We expect leaders to take pro-active action in addressing and solving potential issues.
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Reflection: Have you observed this? What happend?


The (non-)importance of individual actions

So then the question becomes: to what degree does individual leadership behaviour matter?
  • Did political leaders shape the course of history or are they a mere product of their Environment? If the likes of Winston Churchill, Charles de Gaulle, and Franklin D. Roosevelt would not have existed; would world war 2 have the same end-result (a victory for the allies)?
  • Do business leaders set the course of their organisation, or were they merely the captain of the ship that was already on the right course? If the likes of Steve Jobs, Bill Gates, the Benneton’s, or Ingvar Jamprad, would not have existed; would there have been a modern standardised systemic computer operating system, would there be handheld mobile devices with the same user-centricity, would there have been the same societal change Following the Benneton campaigns, would there be accessible, affordable, and appealing furniture for everyone in the western world regardless of their disposable income?
The answer obviously isn’t simple and cannot be answered fully in retrospect. And yes, certain general outcomes could have been achieved (albeit with different details) even without the presence of certain individuals.
At the same time, the impact of leadership cannot be understated either. Their influence, vision, and engagement is critical for the success of many results. It goes without a doubt that the impact of individuals can be profound, and they can shape the wave change with their own colours and flavours.
The impact of individuals is both profound and grandiose (we impact our own environment and success) and miniscule and irrelevant (the overall impact we have on the world and the wider scheme of things is fairly limited) at the same time.
This is one of the many paradoxes of Leadership we will explore later in course.
But for simplicity for now let’s run with the idea that the individual impact is nuanced and we need to be aware that we both have a strong impact but the world will also continue without us.
 
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Reflection: What do you believe?


 

But does Leadership matter?

Wait, you are starting your introduction saying that leadership is not that important at all?