Few leadership models address a CEO's role in building an organisation to do well both financially and in a wider social context. Tesse Akpeki looks at how leaders can attain this.
A new study stresses that disciplines such as finance, organisational behaviours, marketing, operations and strategy need to be woven into a coherent, internally consistent set of practices that collectively reinforce a higher ambition mission.
In Higher Ambition, author Michael Beer selected leaders who defined their purpose as creating economic and social value by adding value to employees, customers, suppliers, other partners and community/society, making decisions with the interests of other constituencies in mind. CEOs who were outliers illustrated their concerns with social values and set criteria for themselves and their companies. The CEO, demonstrating a stewardship role was concerned with a people-centric, high commitment culture and was successfully creating commitment to the organisation and its purpose in all their stakeholders.
Few leadership models explicitly address the leaders’ role in building a “great organisation”: that does well (producing financial results) and does good (contributing to the larger good). The TruePoint Centre for Higher Ambition Leadership, a not-for-profit educational and research institute, brings together higher-ambition leaders from around the world to learn from each other’s experience, offering leadership development programmes for next generation of leaders and conducting research about what it takes to manage in a higher-ambition way.
The visible signs were:
• Forging demanding goals to which people are committed
• Creating a community of shared purpose in which people are committed to the larger good of the organisation as opposed to their departments or themselves
• Hiring people whose values and skills fit the culture and strategy and reinforce and sustain the community of purpose.
The study found that boards often do not ask the right questions about critical issues, nor do they have the data to know what is happening. To make progress, boards need to change their frame for evaluating management and firm effectiveness by asking their CEO what kind of organisation they are building.
What is the CEO doing to create a healthy organisation that can deliver long-term and sustainable success? Time should then be spent assessing whether the CEO is creating a strategic identity, a community of shared values and trust-based relationships with employees, customers, community and commissioners.
Allied to this, boards need to create mechanisms for learning about what is going on in the organisation. Ample consideration needs to be given to how things may go differently. CEOs who spent time crystallising their values, and purpose and how strategy could be defined in a way that integrated strategy with values.
