The Practice of Leadership » Management

American Companies Are the Best Managed in the World

George Ambler — Sun, 24 Jul 2011 15:17:22 +0000

A recent post on Harvard Business Review, “Why American Management Rules the World” discusses research from a group of European researchers which found that on average American firms are the best managed in the world.

“Over the past decade, a team from Harvard Business School, London School of Economics, McKinsey & Company, and Stanford has systematically surveyed global management. We have developed a tool to measure management practices across operational management, monitoring, targets, and people management. We scored each dimension on a range of practices to generate an overall management score, surveying over 10,000 firms in 20 countries. This has allowed us to create the first global database of management practices.”

The mean management score for the countries that participated in this research is illustrated in the chart below.

Some of the findings from this research include:

Well managed firms thrash their poorly managed competitors.
Good management appears to be so strongly linked with good performance that it might be reasonable to expect all firms to make better practices a priority.
More intense competition is clearly associated with better management practices
Management practices vary much more within than across countries
American firms outperform all others
U.S. dominance occurs in the manufacturing, retail, and healthcare sectors
Japanese, German, and Swedish firms follow closely behind.
The middle stand countries like the UK, France, Italy, and Australia, which have reasonable but not brilliant management practices.
Every country has some world-class firms, individual companies are not trapped by the national environments in which they operate — there are top performers in all countries surveyed.
Being in a world-class environment like the U.S. does not guarantee success. Even in America, more than 15% of firms are so badly managed that they are worse than the average Chinese or Indian firm.
Multinational companies perform well wherever they are in the world, even in areas where overall management practice scores were particularly low.
Managers are poor at assessing their own performance.
Countries with more flexible labour markets have better people management.
Better management is linked with higher skills

What is the secret of management success?

When examining what makes for management success on of the biggest drivers is due to differences in people management practices.

“American firms are ruthless at rapidly rewarding and promoting good employees and retraining or firing bad employees. The reasons are threefold.
The U.S. has tougher levels of competition. Large and open U.S. markets generate the type of rapid management evolution that allows only the best-managed firms to survive.
Human capital is important. America traditionally gets far more of its population into college than other nations.
The U..S has more flexible labor markets. It is much easier to hire and fire employees.”

For more on this interesting research and related work, go to the World Management Survey.

Henry Mintzberg on Leadership vs Management

George Ambler — Sun, 26 Sep 2010 07:54:44 +0000

Photo by star5112

I have discussed previously the differences between leadership and management so when I can across this MITSloan Management Review article discussing Henry Mintzberg’s perspectives on the subject it caught my attention. The point the Henry Mintzberg makes is that…

“… ever since the distinction was made between leadership and management — leadership somehow being the important stuff and management being what surgeons call the scut work — attention focused on leadership. My view is that management without leadership is disheartening or discouraging. And leadership without management is disconnected, because if you lead without managing, you don’t know what’s going on. It’s management that connects you to what’s going on. We can make the distinction between leadership and management conceptually, but in practice I don’t think we should.” – Henry Mintzberg, “Debunking Management Myths”

Indeed both roles are urgently needed in modern organisations. It’s important to undertand that when we talk about management and leadership we’re referring to a set of behaviours and not a set personality traits. The article goes on to make a key point, which I feel really goes a long way to resolving the endless “mangement vs. leadership” debate and move fowards a more productive understandning of the key differences…

Debates about which role is better misses the point. The list isn’t about labels. It’s about different roles that produce different results.

Making the distinction between the role of a leader and the role of a manager, such as the one made by Warren Bennis, in his book “On Becoming a Leader“, (see my previous post on the topic here) is important for the following reasons:

The distinction between the two roles is not about putting people in boxes or to classify people into “leaders” and “managers” Rather, it’s about learning to identify when it’s appropriate to exercise the required role, thereby increasing our effectiveness. Certain situations require more of a leadership role, such as setting strategy and other situations require effective management, such as driving execution.
The differences reminds us that we need to be conscious and intential about the role we are choosing to play and the results we can expect from exercising the role.
We learn that management is necessary, but not sufficient and that leadership is required to motivate and inspire. It reminds us that in many cases our organisations tend to be over over-managed and under-led.
The differences reminds us to keep the balance between working in and working on the organisation, to balance effectiveness (are we doing the right things) with efficiency (are we doing things right).
The very best of us embrace both roles, we are great managers AND we are great leaders.

I would welcome your comments and insights on the following:

In what other ways is it useful to make the distinction between managers and leaders?
What can you add to this list?
Reflecting on your experience how do you know which situations you need to approach from a managerial point of view and which situations to approach from a leadership point of view?

Bob Sutton on leadership vs management

George Ambler — Sun, 14 Sep 2008 20:24:48 +0000

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Having previously posted on the distinction between leadership and management, the recent discussion by Bob Sutton on his view of the differences between leadership and management in his post “Leadership vs. Management: An Accurate But Dangerous Distinction?” caught my eye. In the post Bob makes an important point concerning how the distinction between management and leadership affects the conduct and behaviour of leaders…

“… although I think this distinction is more or less correct, and is useful to a degree (one emphasizes the focusing on the bigger picture and the other on the details of implementation), I also think that it has unintended negative effects on how some leaders view and do their work. Some leaders see their job as just coming up with big and vague ideas, and treat engaging in conversation about the details of those ideas or the details of implementation as mere management work that is ‘beneath’ them, as things for ‘the little people to do.’ Moreover, this distinction also seems to be used a reason for leaders to avoid the hard work of learning about the technologies their companies use and the people that they lead and to make decisions without considering the roadblocks and constraints that affect the cost and time line, and even if it is possible to implement their grand decisions and big ideas…. But one characteristic of the successful dreamers I think of — Francis Ford Coppola, Steve Jobs, folks at Pixar like Ed Catmull and Brad Bird — is that they also have remarkably deep understanding of the industry they work in and the people they lead, and they often are willing to get very deep into the weeds. This ability to go back and forth between the little details and the big picture is also evident in the behavior of some of the leaders I admire most who aren’t usually thought of as dreamers… am all for grand visions and strategies. But the people who seem to make them come true usually seem to have deep understanding of the little details required to make them work — or if they don’t, they have the wisdom to surround themselves with people who can offset their weaknesses and who have the courage to argue with them when there is no clear path between their dreams and reality… I am not much rejecting the distinction between leadership and management, but I am saying that the best leaders do something that might be most properly called a mix of leadership and management (a great example is HP CEO Mark Hurd) , or at least, lead in a way that constantly takes into account the importance of management. And some of the worst senior executives use the distinction between leadership and management as an excuse to avoid learning the details they need to understand the big picture and to select the right strategies.”

I agree with Bob concerning the effect that the distinction between leadership and management has on the behaviour of leaders where “Some leaders see their job as just coming up with big and vague ideas, and treat engaging in conversation about the details of those ideas or the details of implementation as mere management work that is ‘beneath’ them, as things for ‘the little people to do.’”. I have also observer this behaviour in many organisations. It is also true that great leaders have a good grasp on the details of the industry and the job at hand, they need to understand an practice the word of leaders and the work of managers.

It is also true that many of the organisations today tend to be over managed and under led. This requires that a focus on developing a leadership practice. It does not mean we stop or reduce our management discipline. We need both to be effective.

I agree that the distinction between management and leadership is useful, as it help us become more self-aware, giving us insight into when we are behaving as leaders and when we are behaving as managers.

If you access your behaviour over the past few months, what percentage of your time was spent on management (the details) and what percentage of your time was spend on leadership (the big picture)? What have been the results? Was this an effective use of your time?

The Essential Difference Between Leadership and Management

George Ambler — Sun, 08 Jun 2008 17:16:24 +0000

I have written in a previous posts on the differences between management and leadership and recently I can across an interesting article with an interesting take on the topic.

“Management can be taught. Leadership cannot be taught or learned, it must be earned.”

I like this perspective, it means that leadership is a choice, it’s the result of out attitudes, values, behaviours and our effectiveness. In a nutshell, it’s the results we achieve and how we go about achieving them.

“If one looks at management development literature, it is only over the last 15 – and particularly the last 10 – years that leadership is mentioned at all. Prior to that, leadership was mostly only assigned to historical political figures such as Napoleon, Churchill, Kennedy and so on. These were people who earned the title leader. Leader was never assigned to organisational supremos. Nor was it given to any manager. It seems that some writers, keen to establish what makes a great manager great, settled on the term leadership as a distinguishing factor. Then they tried to define it. Then we tried to measure it. Some of us even tried to teach it! And there our troubles began…… My contention is that one becomes a manager when one signs on for the job, be it head of the country, firm, school, department or first-line supervisor. One only becomes a leader when other people say so….. This definition of leadership, rather than focusing on the inputs, such as personal skills, characteristics, competencies, traits etc, focuses on the outputs. Managers are judged on their status as a leader in the eyes of their followers and stakeholders by what they do and achieve.”

In his research, Bob Selden, the author of “What To Do When You Become The Boss”, found the following four condition required to create the essence of leadership, these are the conditions required for others to follow, there needs to be:

A shared understanding of the environment – ‘We know what we face‘
A shared vision of where we are going – ‘We know what we have to do’
A shared set of organisational values – ‘We are in this together‘
A shared feeling of power – ‘We can do this‘

What I like about the above four conditions of leadership is that they are shared by the team and the organisation. This view is consistent with Peter Senge who describes leadership as:

“a capacity in the human community to shape its future.”

Although the leader makes a choice to create the conditions for leadership, once these conditions are in place, the community becomes empowered to take action towards the shared vision, the result is leadership.

“The wicked leader is he who people despise. The good leader is he who people revere. The great leader is he who the people say we did it ourselves.” – Lao Tsu

Considering this perspective on management and leadership and the results of your management over the past year. Take some time to ask yourself the following questions:

Have you made the choice to lead?
Have you established the four conditions for leadership in your team?
If not, what actions can you take over the next few weeks to establish these conditions in your team?

Leaders vs. Managers….. Are They Really Different?

George Ambler — Tue, 08 Apr 2008 03:34:03 +0000

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The debate between leadership and management has been raging for a number of decades! I think that the distinction between management a leadership is useful one, in that it help us gain a better understanding of leadership and causes us to reflect on our own behaviour and to ask ourselves “Are we really leading?” So what are the differences between managers and leaders?

“There is a profound difference between management and leadership, and both are important. To manage means to bring about, to accomplish, to have charge of or responsibility for, to conduct. Leading is influencing, guiding in a direction, course, action, opinion. The distinction is crucial” – Warren Bennis

If you’ve been reading this blog for a while, you’ll know that I really admire the work of Warren Bennis, in one of his books, “On Becoming a Leader” he describes his view of the differences between managers and leaders as follows:

The manager administers; the leader innovates.
The manager is a copy; the leader is an original.
The manager maintains; the leader develops.
The manager focuses on systems and structure; the leader focuses on people.
The manager relies on control; the leader inspires trust.
The manager accepts reality; the leader investigates it.
The manager has a short-range view; the leader has a long-range perspective.
The manager asks how and when; the leader asks what and why.
The manager has his or her eye always on the bottom line; the leader has his or her eye on the horizon.
The manager imitates; the leader originates.
The manager accepts the status quo; the leader challenges it.
The manager is the classic good soldier; the leader is his or her own person.
The manager does things right; the leader does the right thing.

This is a great list and it always causes me to pause a reflect on my own behaviour and ask “Where am I spending most of my time? Doing the left hand tasks or doing the right hand tasks?”

Another influential thinker on the distinction between management and leadership has been John Kotter, author of “John P. Kotter on What Leaders Really Do” in this book John makes the following observations:

“Leadership and management are two distinctive and complementary systems of action…… Both are necessary for success in an increasingly complex and volatile business environment.”
“Most U.S. corporations today are overmanaged and underled.”
“Strong leadership with weak management is no better, and is sometimes actually worse, than the reverse.”
“Management is about coping with complexity….. Without good management, complex enterprises tend to become chaotic… Good management brings a degree of order and consistency….”
“Leadership, by contrast, is about coping with change…. More change always demands more leadership.”
“Companies manage complexity by planning and budgeting, by organizing and staffing, and by controlling and problem solving. By contrast, leading an organization to constructive change involves setting a direction (developing a vision of the future and strategies to achieve the vision), aligning people, and motivating and inspiring them to keep moving in the right direction.”

One important point that John Kotter makes is that “Leadership and management are two distinctive and complementary systems of action…… Both are necessary for success in an increasingly complex and volatile business environment.” The fact is that leadership and management are both important, they are two distinctive systems of action, both are necessary as each seek to do different things.

On this topic, Jim Estill posted this great quote on his blog, “CEO Blog – Time Leadership” citing a classic article from Harvard Business Review by Abraham Zaleznik in 1977 that discusses Leaders vs. Managers:

“The difference between managers and leaders, he wrote, lies in the conceptions they hold, deep in the psyches, of chaos and order. Managers embrace process, seek stability and control, and instinctively try to resolve problems quickly – sometimes before they fully understand a problem’s significance. Leaders, in contrast, tolerate chaos and lack of structure and are willing to delay closure in order to understand the issues more fully in this way, Zalenznik argued, business leaders have much more in common with artists, scientists and other creative thinkers than they do with managers. Organizations need both managers and leaders to succeed, but developing both requires a reduced focus on logic and strategic exercises in favour of an environment where creativity and imagination are permitted to flourish.”

In the end, we need to be good at leading first and managing second, the what and why ….. then……. the how and the when!

Reflecting on your behaviour over the past month, ask yourself:

Where are you find yourself spending the majority of your time? Managing or leading?
Given that most organisations are “over managed and under led“, What two management tasks can delegate this week? What two leadership behaviour do you need to focus on and improve this week?