A good business leader today has to be transparent. He or she needs to be like Mark Zuckerberg rather than Bob Diamond. Like Steve Jobs rather than Fred Goodwin. To succeed at every level of business, authenticity and transparency are utterly essential. You can even get away with being obsessive and difficult to work with – just as long as you’re transparent. (See why later.)
Today bankers are widely hated, CEOs are reviled for their eye-watering salaries, and politicians are ignored (or, in Italy, rejected by 25% of voters in favour of a comedian). But this is on the heels of a decade where talk shifted from management and management schools to leaders and leadership skills. So where exactly are all these new leaders?
Where has it all gone wrong – and how can we put it right?
The danger of the opaque business
The recent UK horse meat scandal at Tesco, Aldi, Lidl, Iceland, Burger King and further afield, shows that many large businesses simply don’t know enough about what they sell or promote, or have turned a blind eye to bad practice. Never mind presentation or leadership – the actual sources of their products have become bewilderingly opaque, to them as well as everyone else.
Some businesses don’t even know what they’re selling.
The huge damage done by this scandal demonstrates that a business cannot survive if it is careless (or cunning) about any bad practices in its murky supply chain. It needs to be happy with everyone knowing everything about what it sells. Whether dirty laundry is the result of a mistake or malice, significant damage to reputation is done.
Equally, the resignation of Barclays boss Bob Diamond in July 2012 for fixing the Libor rate – along with other high profile departures in the same industry – indicates that CEOs can no longer expect to get away with it or point the finger at others.
In other words, business transparency is not only vital like never before – it is personal now.
What’s new about this?
Is this new?
Well, bad news has always caught up with politicians – extra marital affairs, cash for questions, passports for donations etc. – often causing resignation and a rupture in their career.
The difference now is that bad news is catching up just as swiftly and terribly with CEOs and companies. And the damage is so considerable that those considered responsible must leave the organisation quickly.
Effectively, the cost of bad news has become too much to bear for most brands.
So what has this got to do with leadership?
Better leadership is the answer to this problem. But not in the obvious sense of businesses needing leaders who won’t end up stuffing shop shelves with beef that is 100% horsemeat.
In many respects, that’s better management.
Better leadership goes beyond this.
The difference between management and leadership is that management is a skill or technique – separable from the personality of the person who delivers it – while leadership is not. Leadership is more about character than an ability to manage the accounts.
Leadership demands that a leader is authentic, does what he says he’ll do and leads by example. So, when a leader’s character or judgement is questioned or found wanting, he can no longer lead.
We’re already expecting leadership from managers – hence the rise in resignations and public disgrace for those who fall short. Now it’s time for those in charge of businesses big and small to step up and lead properly. It’s time to become good business leaders.
The examples of Steve Jobs and Mark Zuckerberg
These days, we all prefer an example to an expert. Which is probably why we love Steve Jobs so much – not only was he an example of incredible innovation, but the fact that he is no longer with us means that there isn’t much new to be discovered about his character. We can’t be let down.
But not everything about his character was exemplary.
Nevertheless the fact that he has been described as manic, obsessed and hard to work with is acceptable because his character flaws were known or transparent and re-enforce our view that Apple under him was a creator of obsessively high quality products.
The tilt towards leadership is also being demanded from an increasingly mobile and agile workforce who believe that they work less for a brand and more for a leader. In fact, can you divorce the brand Mark Zuckerberg from Facebook? Not easily.
Would the developers of Facebook work as hard and with the same passion if they were led by a grey-suited professional instead of this century’s first youth leader? They tried that at Apple and it failed miserably. That’s why they brought Steve Jobs back, warts and all.
The effect of social media is that the power of communication is moving to the many and away from the few such that it can no longer be controlled or manipulated by head office and a specialist PR company.
Instead, corporate and personal brands are about being true to your word. They are about being who we say we are, admitting when we make mistakes and having the courage to set out to succeed again. This applies to leaders of banks, politicians and the heads of the food and retail industry.
We have entered an era of transparent leadership where the leader must act and behave in accordance with his beliefs and those beliefs must be seen to be aligned with the company’s beliefs and actions too.
If not, the digital world will out us and destroy the leader or the organisation. Leaders need to be who they say they are. Welcome to the era of the transparent leader.
Neil Lewis is the author of 100 Rules for Entrepreneurs and publisher of business angel and crowdfunding blog www.ibusinessangel.com. He also runs leadership training for entrepreneurs and execs via his publishing and training company, www.MediaModo.co.uk.