Maximum performance a practical guide to leading and managing people at work

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TeAm YYePG Digitally signed by TeAm YYePG DN: cn=TeAm YYePG, c=US, o=TeAm YYePG, ou=TeAm YYePG, Reason: I attest to the accuracy and integrity of this document Date: 2005.05.11 15:13:52 +08'00' MAXIMUM PERFORMANCE This book is dedicated to the visionary pioneers who created the world we now live in; and to those who are creating the world we will inhabit in the future. MAXIMUM PERFORMANCE A practical guide to leading and managing people at work Nick Forster Professor at The Graduate School of Management, University of Western Australia Edward Elgar Cheltenham, UK • Northampton, MA, USA © Nick Forster 2005 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical or photocopying, recording, or otherwise without the prior permission of the publisher. Published by Edward Elgar Publishing Limited Glensanda House Montpellier Parade Cheltenham Glos GL50 1UA UK Edward Elgar Publishing, Inc. 136 West Street Suite 202 Northampton Massachusetts 01060 USA A catalogue record for this book is available from the British Library ISBN 1 84542 000 4 (cased) Typeset by Cambrian Typesetters, Frimley, Surrey Printed and bound in Great Britain by MPG Books Ltd, Bodmin, Cornwall Acclaim for Maximum Performance ‘In my experience a major shortcoming of most “how to” books on leadership and management is that they purport to offer “Silver Bullets” – magical solutions that, once revealed, will enrich and transform the reader and his or her organisation. Regrettably, business life is not that simple. Rather, it is characterised by uncertainty and lack of precedent and complicated by the different wants, needs and motivations of people. Nick Forster’s practical book, grounded in many years of leadership and management development and MBA education, recognises this complexity and the folly of “one-size-fits-all” solutions. It is a valuable source book, packed full of useful ideas for current and aspiring business leaders.’ – Mr Michael Chaney, Australian Businessman of the Year 2003 and former CEO of Wesfarmers – the Australian Financial Review’s Company of the Year 2002. Mr Chaney becomes Chairman of the National Australia Bank in June 2005. ‘Maximum Performance delivers what it promises. It is practical, useful and well grounded in up-to-date research findings from across the globe. Nick Forster writes well, with a lively voice and has peppered the text with rich examples and case studies. The diagnostic skill exercises and inventories offered throughout are especially helpful. The book meets the needs of both managers and students alike, across a wide span of experiences. Well worth the investment.’ – Professor Barry Posner, Dean of the Business Faculty at Santa Clara University, California and co-author, with James Kouzes, of The Leadership Challenge ‘Maximum Performance is an essential read for all business owners, managers, consultants and key decision makers. It is an outstanding and comprehensive insight into the broad range of managerial and leadership issues which confront business people today. It is practical and littered with excellent case study examples and illustrations. Its unique style is easy to read, thought provoking and demystifies concepts that are easily misunderstood outside an MBA course. Grasp and digest this book quickly because it’s the smart thing to do.’ – Barry Smith, Managing Director, the General Management Consulting Group ‘Nick’s book is an energetic and down-to-earth exploration of the many dimensions of this enigmatic thing we call leadership. It is a distillation of much knowledge, experience and insightful observation. There is refreshing and satisfying clarity of discussion; with comment on many management theories, explanations of evidence and research and the consequences of their applications in organisations. The pages are brimming with examples, keeping the messages real, practical and always interesting. Maximum Performance is thought provoking, and the reader is constantly challenged to assess his or her own knowledge, experience, attributes, perceptions and behaviour. It is a wonderful resource for those beginning their endeavours, introducing them to the complexities of leading people, and a delightful summary of instantly recognisable experience to those who are well on the journey. It is hugely valuable to all, whether for new knowledge or a welcome refresher. And, there is just a touch of irreverence, adding an enjoyable balance to a serious subject.’ – Dr Penny Flett, CEO of the Brightwater Care Group and Telstra Australian Business Woman of the Year, 1998 v vi MAXIMUM PERFORMANCE ‘We all seem to know when we are receiving good or bad leadership, yet for many of us being a good leader seems to be so elusive. Why is this so? The fact that we are human and sometimes trapped by our wants, needs and motivations inevitably gets in the way, and leadership within Local Government is fraught with complex problems and competing forces both internally and externally. Maximum Performance will be an extremely useful aid for all who are looking for a practical, sensible and thought provoking insight into management and leadership issues. Nick provides an excellent insight into the mysteries of management and leadership with this very practical and useful book that I am sure will be a great resource for current and emerging leaders.’ – Ricky Burgess, CEO of the Western Australian Local Government Association and the Australian Institute of Management Business Woman of the Year, 1997 ‘As consultants working with small to medium sized businesses, we are always searching for practical resources to recommend to our clients that can help them put their activities into a broader perspective, and help raise their understanding and expectations of what their businesses and employees are capable of. Maximum Performance is such a resource. Not only does it demonstrate the true value of good leadership, people management skills and the role of organizational culture in developing, motivating and retaining good staff, it also juxtaposes these with broader issues such as managing change, creativity and innovation, managing employee knowledge and intellectual capital, and the impact that emerging technologies will have on business and organizations in the near future.’ – Philip Watson, Director and Principal Consultant, the General Management Consulting Group Contents List of figures List of tables The author Acknowledgments Preface viii ix x xi xiii 1 The foundations of leadership and people management 2 Personal performance and stress management 3 Communication at work 4 Employee motivation, empowerment and performance 5 Leading and managing teams 6 Doing it differently? The emergence of women leaders 7 Managing power, politics and conflict 8 Leading organizational and cultural change 9 Innovation and organizational learning 10 Managing employee knowledge and intellectual capital 11 Leadership and people management in high-tech, networked and virtual organizations 12 Leadership and business ethics Conclusion: leading and managing people at work Appendix 1 Appendix 2 The business case for emotional intelligence The benefits of health and wellness programmes Bibliography Index vii 1 57 92 160 201 224 276 298 347 396 429 487 536 548 551 556 576 Figures 1.1 3.1 4.1 6.1 6.2 8.1 9.1 11.1 11.2 Would you invest in this company? The spider Content theories of motivation compared Male and female brains Masculinity and femininity Kolb’s learning cycle Picture puzzles The exponential growth of computing, 1900–1998 The exponential growth of computing, 1900–2100 viii 38 131 166 237 248 316 356 434 434 Tables 1.1 1.2 3.1 4.1 4.2 5.1 6.1 7.1 9.1 10.1 11.1 12.1 12.2 12.3 The origins of our ideas and beliefs about leadership Desired leadership qualities compared Communicating with the whole mind The satisfaction–dissatisfaction process Semco: tore up the rulebook in the 1980s Team rules Confidence in women The two faces of power and politics Linear and lateral thinking Knowledge assets Out with the old and in with the new Perceptions of occupations’ ethical standards Top five performing ethical investment trusts in Australia, 2001–2 Transparency International corruption perceptions index, 2003 ix 21 45 133 171 196 220 244 280 352 408 454 507 508 523 The author Professor Nick Forster is based at the Graduate School of Management (GSM), The University of Western Australia. He has been involved in postgraduate management education since 1991 in the UK, Australia and Singapore. At the GSM, he has taught on the Organizational Behaviour, Management of Organizations, and Social, Ethical and Environmental Issues in Organizations units on the MBA programme, and the Managing Strategic Change unit on the Executive MBA. He has also received ten MBA-nominated commendations and awards for teaching, and was chosen by his peers as a nominee for the 2000 Australian Universities’ National Teaching Awards ceremony in Canberra, attended by the Australian Prime Minister John Howard. He has published four books, written more than 70 articles in a variety of international academic and professional journals, and has produced several research and consulting reports for organizations in Australia and the UK. He has been a regular contributor to WA Business News, and was also a guest management columnist for Corporate Relocation News, the biggest selling corporate relocation magazine in the USA, from 2000 to 2002. Outside the GSM, Nick has been involved with the Australian Institute of Management (AIM) Leadership Centre in the delivery of leadership and management training workshops to several of WA’s largest companies and public sector organizations, including the Office of the Premier and Cabinet and the City of Perth Executive. From October 2003 to March 2004, he was a Principal Facilitator for WesTrac and the Water Corporation in AIM’s Action Learning Programs, run in conjunction with the Harvard Business School. He has also collaborated in numerous research and consultancy projects with UK and Australian companies, and was on the national judging panel for the 2003 and 2004 Australian Human Resource Management Awards (for further information, see Nick has lived in several countries and worked in a variety of other jobs in his younger days, as a barman, waiter, house-renovator, safari park warden, professional musician, music studio engineer and part-time ski instructor. His leisure interests include alpine skiing, mountain biking, scuba diving, white-water rafting and, occasionally, bungee jumping. x Acknowledgments I’d like first to express my gratitude to all those people, past and present, who have helped to shape my understanding of leadership and people management in contemporary organizations. These are, in no particular order, Alistair Mant, Barry Posner, Jay Conger, Edgar Schein, Edward ‘Weary’ Dunlop, Jeffrey Pfeffer, Penny Flett, Ricky Burges, Michael Chaney, Fons Trompenaars, Daniel Goleman, Nelson Mandela, Confucius, Tsung Tzu, James Kouzes, David Carnegie, Martin Luther King Jnr, Ray Kurzweil, Bill Hewlett and Dave Packard, Ricardo Semler, Richard Teerlink, Charles O’Reilly, Tom Peters, William McKnight, Germaine Greer, Joan Kirner, Moira Rayner, Jack Welch, Winston Churchill, Scott Adams, Paul Robeson, Henry Mintzberg, Abraham Lincoln, Franklin D. Roosevelt, Edward de Bono, Andy Groves, Herb Kelleher, Gordon Bethune, James Collins, Jerry Porras, Fiona Wilson, Charles Handy, Amanda Sinclair, Peter Drucker, Gary Hamel, Nicolò de Machiavelli, Aristotle, Plato, Socrates, Anita Roddick, Peter Senge, Ari de Geus and last, but not least, John Cleese in his Video Arts days. Their insights about effective leadership and people management can be found throughout this book. During an academic career spanning 16 years, I’ve been privileged to be involved with hundreds of able, motivated and creative MBA and Executive MBA students in the UK, Australia and Singapore. The contents of this book have been influenced by their anecdotes and stories about the leaders and managers they have worked under, as well as their personal experiences of leading and managing others. All the materials, exercises and self-evaluation exercises contained in this book have been extensively ‘road-tested’ with well over a thousand of these men and women and many other groups of professionals and managers, so their contribution to this has been significant. I’ve also had a number of high-profile guest speakers on MBA programmes in recent years. They too have shaped my understanding of what successful leadership and people management is really all about. I’d like to thank both groups for their influence and inputs to the book. I’d also like to thank Fenman Limited, the Financial Times and PrenticeHall, MCB University Press, McGraw-Hill, Pearson Education, Alan and Barbara Pease and Ray Kurzweil, for their permission to make use of the following materials. xi xii MAXIMUM PERFORMANCE Chapter 3: N. Forster, S. Majteles, A. Mathur, R. Morgan, J. Preuss, V. Tiwari, and D. Wilkinson (1999), ‘The role of storytelling in leadership’, Leadership and Organization Development Journal, 20(1), 11–18, and N. Forster (2000), Managing Staff on International Assignments: A Strategic Guide (pp. 47–9). Chapter 6: ‘The Brain Wiring Test’ from A. Pease and B. Pease (1998), Why Men Don’t Listen and Women Can’t Read Maps (pp. 64–72). Chapter 8: N. Forster (2002), ‘Managing excellence through corporate culture: the H-P way’, The Management Case Study Journal, 2(1), May, 23–40. Chapter 10: ‘Does your organization have a knowledge management culture?’ and ‘The Knowledge Network’, from B. Bagshaw and P. Philips (2000), Knowledge Management. Chapter 11: N. Forster (2000), ‘The potential impact of third-wave technologies on organizations’, Leadership and Organization Development Journal, 21(5), 254–63; ‘The exponential growth of computing 1900–1998’; ‘The exponential growth of computing 1900–2100’, from R. Kurzweil (1999), The Age of Spiritual Machines. Conclusion: N. Forster (2000), Managing Staff on International Assignments: A Strategic Guide (pp. 153–4). Last, but not least, I’d particularly like to thank Edward Elgar for his belief in this book’s potential, Francine O’Sullivan, Joanne Betteridge, Karen McCarthy and Caroline McLin for their patient guidance and assistance throughout the editing and formatting process and the submission of the manuscripts for the book, and Madeline Tan for her help with the graphics and diagrams. Nick Forster Perth, Western Australia, September 2004 Preface Walk into a large bookstore in any city of the world, stroll through the bookshops at international airports, visit university libraries or browse e-booksellers’ websites and you will find dozens of books on leadership and people management. These will range from highbrow academic discourses to books written by management consultants, from the autobiographies of well known political and business leaders to satirical works on modern organizational life, like those of Scott Adams or Dennis Pratt. What can one more book add to this extensive and wideranging literature? First, all of the materials, self-evaluation exercises and questionnaires contained in this book have been extensively ‘road tested’ in the UK, Singapore and Australia, over a ten-year period, with more than one thousand Master of Business Administration (MBA) and Executive MBA students, on multi-award winning postgraduate management courses. They have also been tried and tested in dozens of leadership and management development courses over the last decade. Only those materials and exercises that have worked for busy managers and professionals, or have passed ‘The MBA Test’, are included in this book. Hence it is particularly suited to people enrolled on MBA programmes, as well as those who may want to update their leadership/people management skills but are unable to take time off work to attend expensive (and often ineffective) ‘management training’ courses. Second, many publications overlook essential elements of present-day leadership and management, particularly those relating to self-awareness and integrity, personal values, personal performance and stress management, and vision and creativity. This book is comprehensive in its coverage of all the elements of leadership and people management that professionals now need to be aware of. This includes traditional topics, such as employee motivation and performance, communication skills and leading and managing change, as well as more modern issues, such as business ethics in a global economy and leadership in high-tech and virtual organizations. It also looks at how leaders and managers can create cultures that promote essential modern organizational competencies such as innovation, the effective dissemination and use of knowledge and intellectual capital, and creating systemic intelligent learning capabilities amongst employees. xiii xiv MAXIMUM PERFORMANCE Third, this book integrates several perspectives on leadership and people management, including those of real-life leaders, business commentators, management consultants and academics – with a fourth dimension: what we’ve already known about effective leadership and people management throughout the ages, and yet seem to have to ‘reinvent’ with each new generation. The book also synthesizes materials from more than 700 books, articles, professional journals, newspapers and websites. What appears here represents a distillation of the best practical ideas about leadership and people management of recent times, condensed into a form that busy managers and professionals can assimilate and make immediate use of at work, in large, medium-sized or small organizations, and in the public or private sector. Fourth, the book demystifies leadership and people management. It highlights not only the ‘hard-wired’ traits we may inherit at birth, but also the ‘soft-wiring’, that is the kinds of leadership competencies and people management skills that we can all learn to develop and improve throughout our working lives, given self-belief, time and commitment. To this end, the book will systematically review the attributes, skills, qualities and competencies that are most often associated with successful leadership and people management, and how these can be developed and enhanced. These include the following: • • • • • • • • • • • self-awareness and self-discipline, competence and credibility, a mixture of several kinds of intelligence, great self-motivation and the capacity for hard work, combined with a good understanding of their physical and psychological limitations, exceptional two-way communication skills, combined with an ability to lead, direct and focus dialogues with others, the ability to engage with the minds and hearts of others and, as a result, a capacity to motivate and inspire their followers, the capacity to question ‘common-sense’ ways of doing things combined with the ability to make fast practical day-to-day decisions with incomplete information or knowledge, an ability to learn and unlearn quickly, while not discarding good leadership and people management practices that have stood the test of time, the ability to use power effectively, based on an understanding of the art of organizational politics, increasingly, a hybrid blend of what have been traditionally regarded as ‘male’ and ‘female’ leadership and people management styles, self-confidence and resolve in adverse or uncertain situations, without resorting to autocratic or domineering behaviour, PREFACE xv • the ability to think beyond the present and envision the future, • the capacity to initiate, lead and manage the complex processes of perpetual organizational change, innovation and learning, without becoming reactive ‘fad-surfers’, • an appreciation of the role that employee knowledge and intellectual capital now play as key drivers of organizational success and profitability, • an understanding of both the potential and the limitations of new and emergent technologies in organizations, and an awareness of the profound impacts these will have on the management of organizations during the first two decades of the 21st century, • high ethical standards, combined with a pragmatic understanding of doing business in the real world. Fifth, the book takes into account the fast-changing worlds that leaders and managers now work in, and the new skills and qualities that are required to succeed in these often chaotic environments. The last two decades of the 20th century were characterized by rapid change and this period was variously described as ‘The Age of Surprises’, ‘The Age of Uncertainty’, ‘The Age of Chaos’ and ‘The Age of Blur’. These surprises and uncertainties included the challenges of globalization, political upheavals, the threat of global terrorism, regional economic instabilities, corporate rationalization and downsizing, merger-mania, the breathtaking pace of technological innovation, a number of spectacular corporate collapses, the end of ‘jobs for life’ for almost all employees, the continuing redefinition and realignment of the roles and activities of organizations, employers, trades unions and employees throughout the world, and growing ethical and ecological challenges for organizations operating in the global economy. The first two decades of the 21st century will be characterized by even greater change and uncertainty. Global economic forces, new technologies and the information revolution are driving the fastest period of change in human history and in the world of business. ‘Future shock’, ‘chaos’ and ‘blur’ are now permanent features of life in many organizations. Corporate longevity is getting shorter each year, with the average life expectancy of a typical large or medium-sized company falling in every decade since World War II. The domination of traditional large bureaucratic organizations, since the dawn of industrial capitalism in the early 19th century, is being challenged as new Third-Wave organizations emerge. These developments mean that all organizations have to think faster and smarter just to keep up with the competition. Individually, we walk faster, talk faster, sleep less, consume more information and work more than ever before. We may have three or four different part-time jobs or be employed on a succession of short-term xvi MAXIMUM PERFORMANCE contracts. Jobs for life are rare and job insecurity is a fact of life for many professionals. Employees can now expect to work for between five and ten employers in a lifetime. But, as the industrial age’s hegemony is challenged, there are also opportunities for entrepreneurs and for anyone who is willing to challenge conventional management thinking and embrace, as Tom Peters suggested in the early 1990s, ‘Crazy Ways for Crazy Days’. In the information age (if we have good ideas, knowledge, energy and persistence) we can become business pioneers (and, maybe, millionaires) overnight. The ability to manage the uncertainties that arise from these changes, developments and trends is now an integral part of the repertoire of successful modern business professionals, and this book is designed for leaders and managers working in this demanding, complex, stressful and fast-changing world. As intellectual capital, continuous innovation, organizational learning and new technologies become the main drivers of organizational success, leader/managers must not only be able to understand these, they must also find new and more effective ways of enabling their followers to cope with these new organizational realities, help them perform to their maximum potential and to aspire continually to ever-higher levels of performance and achievement. Getting the most out of this guide to leadership and people management Teachers open the door, but you must enter by yourself. (Old Chinese saying) This may appear to be a very strange thing to say at this point, but I don’t believe that leadership and people management skills can be learnt from books. You might now be thinking, ‘What’s the point of buying this one then?’ Well, books – particularly the right kind – do play a vital supporting role in the learning process. When learning anything new, there is no substitute for a supportive mentor or an inspirational teacher, but they may be hard to find or may not always be available for help and advice. Even then, in any organizational, work or educational setting, they only form part of the learning equation. The main part is what you bring into these. This includes • • • • your personal aptitudes, abilities and experience, the leadership and people management skills you already possess, an awareness of your existing strengths and limitations, and knowing what you want, and how you are going to achieve this in the future. PREFACE xvii The purpose of this book is to support your side of the learning equation, and it does this on three levels: the theoretical, the practical and the personal. Because you are reading this book, either you are going to become a manager/leader in the future, or you may already have a lot of work experience but want to learn about alternative ways of leading and managing people at work. Either way, you’re interested in personal growth and improving your skills, and open to new ideas and change. You care about your career and want to equip yourself for the challenges of the future. In order to develop these skills further, this book can also be used as a guide to your personal development and learning, and will show how quite simple changes to the way we all ‘manage’ people can help us to become more effective leaders and managers of others. Throughout the book, there are a series of optional questionnaires and self-evaluation exercises that will help you to develop a unique leadership/management style, and enhance the way you lead and manage your people at work. However, it is important to emphasize that this is not a book that sells instant ‘fads’ or ‘quick-fix’ solutions. Those who claim that you can become a better leader/manager in just a few days or weeks are misleading you, or want to sell more copies of their books, or get more bums on seats at their training workshops. If anyone tells you that you can become a really successful and effective leader or manager in a short period of time they are being dishonest. This requires self-belief, time and commitment. This means that you’ll need to spend some time working through this book, perhaps try out the self-evaluation exercises, actively reflect on your own leadership and people management practices, be prepared to unlearn old habits and beliefs and, maybe, learn some new ones. This is not a ‘self-help book’; it is a guide to personal lifelong learning and self-development. By the end of the book, you should have acquired a comprehensive ‘tool-kit’ that you can dip into as and when needed, regardless of the circumstances that you find yourself in, the quality of the people you are leading, or the type of problems you are dealing with at work. Of equal importance, you will be in a better position to decide if you need to discard old or redundant leadership and people management practices that no longer work effectively. You will be able to evaluate what does and does not work for you at present, and decide which new skills you may need to acquire to enable you to become an even more effective and successful leader/manager in the future. This book also contains hundreds of suggestions and opinions, from business and political leaders, consultants and academics, about how leadership and people management skills can be developed and xviii MAXIMUM PERFORMANCE enhanced. However, that is all they are and you should not view this as a one-way process, whereby ‘the experts’ tell you what you ought to be doing with your life. Treat this as an active, two-way process that allows you to reflect on your current practices. In addition, some of the suggestions in this book may not be directly applicable to your particular occupation, work setting or organization at the moment. And, if you know ways of leading and managing people that are better, or work more effectively, then use these instead (and, if you have time, please send me an email to let me know what they are!). The only way to really improve as a leader/manager is to embrace active self-learning and development. While ‘training’, in a generic sense, may have its uses, it all too often falls victim to the well-documented ‘halo effect’, where people may emerge re-energized and refreshed from leadership or management development programmes, only to find that newly acquired knowledge and insights fade away over time, as they find themselves falling back into old and ineffective patterns of behaviour at work. And, as has often been pointed out, ‘training’ is for circus animals and dogs, not human beings. In effect, this means that none of the ‘experts’ in this book can teach you anything. Unless you are motivated and committed to learn how to become an even more effective leader/manager, little will be gained from this book. Self-directed learning and learning-by-doing are now becoming the dominant modes of personal improvement and professional development. This is because lifelong learning is now the name of the game, not possessing pieces of paper with ‘BA’ or ‘MBA’ stamped on them (Botsman, 2002). This means that you can only improve your leadership and people management practices by • actively reflecting on what you currently do as a leader/manager, • comparing this knowledge with the supermarket of information and ideas in this book, and identifying areas where changes or improvements might be made, • developing strategies to improve your leadership and people management skills on a weekly and monthly basis, • putting these into practice at work, by treating this environment as the principal ‘training ground’ for your development as a leader/manager. There are two ways to approach this book. The first is on a need-toknow basis, where you simply dip into it and have a look at areas of interest, or review topics that you would like to discover more about. The second and more rigorous method is to start and maintain a personal diary. In this, you can reflect on your understanding and practice of leadership and people management, and compare what you
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