Leadership styles and organization culture

Leadership styles and organization culture

– Kiran Kothekar
Satyashri Mohanty
Organization culture is mostly shaped by the way its leaders interact with the people in that organization. At times, we come across leaders, who believe that the company’s most chronic problems – stagnant sales, delayed projects or inefficiency in production or quality issues – exist only because people aren’t good enough. They blame managers reporting to them, see them as incompetent, lacking motivation and commitment. They have very little trust in their subordinates, and they are authoritative. They maintain that managing an organization is all about managing the people in it. Hence, they deploy “people-driven” tactics to control them. Here are a few examples.

  • Frequently shifting roles and responsibilities of people
  • Firing key senior managers and hiring new ones regularly
  • Personally controlling every aspect of decision-making; very minimal delegation
  • If the organization is very big, they use a coterie of personal favorites to keep watch over others and to overrule decisions of others.

Resultant impact is an environment of “find-the-culprit” way of analyzing issues. In such an environment, everyone tries to be a survivor. All actions that people take are only with the purpose of securing their place in the organization. When key managers operate based on principles of self-preservation, additional issues crop up. This perpetuates a toxic work culture.

Information Opacity
In such environments, feedback of managers is usually filtered to “save” or “promote” someone, and as a result, leaders don’t get to know the real issue at hand for a long period, despite having many interactions. Data is tailored to suit the hypothesis of individual managers. When leaders eventually discover the real issue, they feel cheated, which in turn further reinforces the belief that managers are bad and cannot be trusted.

Low management bandwidth
Managers then become focused on avoiding blame. Despite a formal structure, they tend to pass on decision making to the leaders. Consequently, the leaders’ bandwidth is stretched. And Company’s decision making process slows down.

Instinctive yet bad solutions
In such environments, leaders become delusional about their own intelligence, especially when they are surrounded by managers who feed them unrealistic amounts of positive feedback. Leaders become instinctive in decision making. Instinctive decisions without critical feedback, tend to be half-baked, and eventually cause damage over a period of time. Reversal of wrong decisions becomes difficult as critical feedback does not reach the leaders.

There may be other decision biases in play as well. Filtered/limited information can create availability bias which prompts leaders to draw a conclusion based on available information. . Also, once they have some initial information, they tend to filter all subsequent information through that early data. This is called anchoring bias which can also hamper the decision-making process.

Low on Innovation
An environment of blame is unfavorable for innovation. Fear of failure encourages people to maintain status-quo and avoid experimentation. The only exception is made for ideas originating from the leaders themselves!

Organizations have various levels of this toxic work culture depending on their leadership styles – some are on the extreme, while others suffer from it fleetingly.

The question before us is ‘why do such leadership styles thrive in organizations?’. This cannot be answered by putting the blame on specific leaders and their styles. We will not gain any knowledge by doing so.

Cognitive bias and Leadership style
Leaders, like normal human beings, suffer from cognitive biases. One such bias, is Attribution Bias, which refers to the systematic errors made when people evaluate or try to find reasons for their own and others’ behavior/performance.

When it comes to undesirable behavior from others, we tend to attribute it to personality traits of the person, while when it comes to explaining our own behavior, we attribute it to systemic conditions, our skills or intelligence depending on outcomes. When desired results come in, we credit our actions and intelligence. Undesirable results are blamed on unavoidable circumstances. (That reckless driver, who skipped the signal, is a jerk! But when I did it, it was because I had to rush for an appointment with the doctor. The improved returns in the stock portfolio is because of my decisions, while the dip was because of harsh market.)

Leaders, occupying a position of power over others, receive minimal critical feedback. Hence, they, unknowingly suffer severely from attribution cognitive bias.

Acknowledgement of Bias
Unfortunately, unlike computer programs, the bugs in the form of biases in human cognition cannot be removed. One can only be consciously aware and then be willing to live with good enough workarounds to prevent its damaging effect.

Awareness of attribution bias can come about through instances of critical feedback. This is hard to extract from one’s subordinate. So, the only option is to do an experiment on own self a simple thought experiment.

Make two lists of people by asking the following questions.

“Who were your favorites in the past? Who are they in the present?”

If the lists are different, most likely you are suffering from attribution error. Your own judgement about people cannot be subjected to any repeatable test. Hence, by definition, it cannot be taken seriously.

A template to overcome Attribution Bias
Once one is aware of the bias, then willingness to self-impose a workaround is possible.

The way to overcome the attribution bias is putting in four transparent rules, which will force one to circumvent the bias.

  • Do not blame: While analyzing any issue for causality, no one is allowed to blame any manager. If there is temptation to attribute undesired behavior of an individual manager as the cause, the analysis has to go deeper to understand why the manager behaved the way he did. This way of thinking may force one to look into policies or procedures or formal responsibilities that lead to the behavior.
  • Look for underlying conflict: If issues are chronic and repetitive, assume that there is an underlying deeper conflict in the organization. A top-of-the-mind solution, for the issue at hand, usually will have a severe negative for some other aspect of business. Unless the competing needs are understood, no decision should be taken. Sales growth can conflict with inventory reduction needs or margin improvement goals. Quality goals can come in the way of production efficiency improvement. Speeding up a project can come in the way of completing entire scope.
  • Find ways to meet competing needs: The pressure of competing needs is a big reason for a standstill in decision making. One needs a breakthrough approach to develop solutions which meet both competing needs. Without that, delays in decisions are inevitable. For example, sales growth and inventory reduction can be achieved by finding a way to reduce supply lead-time. Quality goals can improve while enhancing efficiency by ensuring quality parameters at source.
  • Do not assume people are ‘lazy’: If a manager is not completing tasks assigned to him, most likely he is busy with something else that he/she thinks is more urgent.

Leaders should formalize and widely announce these four rules in the organization. This will exert collective pressure on them (and others) to adhere to them.
Good usage of the above “rules” will lead to the following changes

  • Leaders will talk less and listen
  • They will master the art of asking critical questions to uncover real issues.
  • Soon, they will facilitate decision-making rather than making all the decisions.

Once leaders begin following the above practices, the culture of the organization will undergo a transformation. Transparency will improve as bad news will move up faster. Decisions will be speedier as managers will no longer take refuge in defensive behavior. More importantly, managers will not worry about failing – a critical requirement to be an innovative organization.

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