There are a multitude of programs to develop leaders in our business world today, and there is a broad school of thought on how to build the company culture you want.
But most frequently leadership and organizational culture are seen as two different things, which is a fundamental mistake.
We develop our most effective leaders through a values-based organizational culture that supports and expands them, and we build powerful, progressive cultures through transformational leaders that drive them.
Our challenge, as leaders in the 21st Century, is to understand the interrelated nature of organizational culture and leadership, and to create the required reinforcement within our cultures that allows transformational leadership to flourish. Ideal leadership is not the domain of the individual hero who swoops in and saves the day; it is the collective effort of a business culture steeped in values, community, and consistent practice.
It is virtually impossible to separate the individual leader from their organizational culture because they are parts of the same system and have direct influence over one another. Both the leader and the culture must be values-based in order for the right reinforcement to happen. If the values are what drive the culture, then they must also drive the hiring, development and promotion of leaders in that culture.
Shared values make such a difference for both the organizational culture and the individual leader because as leaders, and human beings, we continually struggle with ambiguity and uncertainty. Values provide us a compass by which we can navigate the emotional turmoil of leading. We tend to have a belief that “strong” leaders don’t show emotion, and as such we can be unprepared to handle the emotional challenges that are a part of every leader’s experience. Shared values between the individual leader and the organizational culture provide relief from those challenges by providing clear direction.
Cultures that are values-driven also gain a competitive advantage both in performance and in employee engagement. Various studies show a growth rate of four times faster for companies whose culture is based on shared adaptive values, with a 750 times higher profit performance ratio, according to John Kotter and James Heskett's Corporate Culture and Performance.
Jim Collins noted in Built to Last: Successful Habits of Visionary Companies that values-driven companies outperform companies that are not by six times, and the general stock market by 15 times. Basing the system of an organizational culture and its leaders on shared, adaptive values is not only good for the soul, it is good for the bottom line.
If individual leadership can have such a substantial impact on the organization’s culture and consequently its success, should we not focus our efforts just on developing strong individual leaders rather than on the culture within which they work? The challenges that face us as people and as organizations are complex and intertwined. Heroic leadership assumes that one leader can be in control, can both understand and resolve complex challenges on his or her own.
We need to abandon this notion of leader-as-hero and support leaders who know that problems are complex and that everyone who is a part of the system needs to be included in finding solutions. This means opening our doors more, being more transparent about the decisions we are making, including more members of the organization in debate and dialogue.
We develop better leaders when we focus on the whole culture, not just the individual. Leadership isn’t about individual power, it is about building healthy workplaces where leadership can grow. As Lao Tzu said, “The wicked leader is he whom the people revile. The good leader is he whom the people revere. The great leader is he whom the people say, 'We did it ourselves.'"
Our goal as leaders is to recognize the interrelated parts of the systems within which we operate—especially our organizational culture—and to ensure that we base our actions on a shared set of ethical values that allow our own leadership and our organizations to thrive.