The Power and Paradox of Distributing Leadership

"Everytime I try to implement change, the organizational antibodies came storming in to attack me."
                - Unnamed executive from a media company

One of the critical characteristics that we found in the cultures of Tuned In companies was their willingness and effectiveness at distributing leadership. It's a hard thing to do. Most organizations take on a dominant culture where the leaders in one functional unit seem to drive decision-making. Could be sales. Could be finance. Maybe engineering. Or maybe the entrepreneurial leader. It is the rare company that can empower all facets of the organization to work together as a unit strategically and effectively.

Why is it so hard to do?

I was struck this week by two posts that came across the wire from folks I admire. One was from Kristin Zhivago on Buyer Scenarios vs. Personas. Kristin is brilliantly pragmatic in her approach to coaching leaders and always finds the keys to leveraging measurable performance improvements. In her post, she argues to be careful with personas ... that they are problematic when transferred into the sales arena because they promote generalized buying experiences that turn buyers off vs. specific solutions to real problems buyers have served up in the context of how they want to buy from you.  Hmm ... interesting point but personas just happen to be one of the core elements of how we believe Marketing can transform itself from the t-shirts and coffee mugs department to one that is strategically relevant. Why the disconnect?

Today, I stumbled across another one from the Silicon Valley Product Group http://www.svpg.com/blog/blog.html titled 'What Product Management is Not'. In it, they argue that Product Managers should not be responsible for business cases and market requirements because "markets don't have requirements, people do".  Hmm ... the idea of a strategic role for product managers where they are the President of the Product defining strategies for how to pursue n=many vs. n=1 markets is one of the tenets that more than 3000 companies and 45,000 product managers have now embraced as a standard.  Why the disconnect? 

Do you ever run into this in your organization?  One department says something they think is an absolute no-brainer and another hears the exact opposite?  Or worse yet, thinks it will erode their power base. We have a theory about these kinds of things. It all relates to your view of how leadership should drive the company culture, strategy and execution. Is it revenue-based? Innovation-based? Customer service-based? Or more market-driven?

One of the areas where this is most obvious is the divide we find between sales and marketing. We've observed how the concept of 'solution selling' really resonates in sales but doesn't in marketing. Why?  Sales hears alignment to buyers while marketing hears one-off customizations. We've also observed how business cases and market requirements divide development and product management organizations. A 'plan' means development has to code to spec on a timeline while being 'agile' allows innovation to spark on the fly ... or in Product Management terms 'out of control'. 

So, here's our theory. It all relates back to distributing leadership effectively and developing a clear understanding of the holistic role of each department in the organization. The best companies embrace the techniques that enable each department to align strategically to the things that will make it valuable and sustainable as a discipline. The power of persona-based marketing is real. The effectiveness of solution selling is real. The value of a strategic approach to product management is real. And the benefits of being agile in development are real. When I hear one department (or thought leaders in those disciplines) talking about why these foundations have issues when transferred from one world to the next, I acknowledge that they're right but suggest that they are missing the real point.

The power of distributing leadership depends on bringing each facet of the organization closer to the market ... it's problems and the experiences that they can relate to that make them want to buy from you. The paradox is that teamwork is required and 'gaps' have to be bridged. So, why bother?  Because getting tuned in and distributing leadership will earn you on average 31% higher profits, 2x higher growth rates and 20% higher customer satisfaction levels than one-dimensional approaches.

Call me Willie Sutton (he robs banks) but I'm going where the money is. Sure there are management issues to deal with but the overall health of the business is what's most important. 

Comments

[Dave the Rave]

Tenants? Surely you mean tenets? I've heard my CEO talk about tenants and as we aren't a real estate management company I was rather suprised. Seems to be a Silicon Valley affliction..... If you're going to adapt the English language ("reach out", "actionable" and other management speak, at least spell it rite;).

[Phil Myers]

Guilty as charged Dave. Thanks for the feedback. I really do appreciate it. I'll work on making my language checker more actionable in coming posts. Hope you are enjoying the blog.

[Michael Ray Hopkin]

Phil,
I agree with your ideas about bringing each facet of the organization closer to the market. If the leadership of the company (usually the CEO) understands this concept and makes it part of the culture, the company's success rate increases dramatically.

In my experience it seems the larger the company grows the more difficult this becomes. I believe it happens, ultimately, because people are involved. It's people who are the leaders (or not). There seems to be a natural tendency for people to become less motivated and unplugged as the company grows. All companies want to grow and increase revenue, and that usually requires (or results in) hiring more people, which over time means the average person is further away from the market.

It takes an increased effort to create an environment where people can get closer to the market and really understand--and feel they're a part of--what it takes to succeed. To do that effectively takes leadership.
"Power and Paradox" sums it up well from my perspective.

Michael

PS. Dave's comment caused me to do a double-take on "further" vs. "farther" (I think I got it right;-)