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Leaders play a significant role in influencing an organisation’s culture. Discuss.
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A leader is not just a manager. In Foundations of Management, the authors define a leader as someone who is 'appointed or [emerged] from within a group and are able to influence others for reasons beyond formal authority' (Bergman, Coulter, Robbins, Stagg, p. 568, 2006). There is therefore no doubt that leaders exert a great influence over company culture. Company morals, values and practices are often shaped from the top down by figureheads in charge of operations. From personal experience, we can all name times when we have been very influenced by the head of a business we were working for, and we can all name corporate figures who are synonymous with their business ethic. Leaders acts as good examples, human beacons in times of crisis and triumph and figures of authority to their employees. They can also be the face of a company to the outside world, and are therefore frequently synonymous with the company's reputation. Thus whilst the extent to which this statement is true does vary on a case by case basis, we can say with assurance that leaders certainly have the ability to be a driving force is defining an organisation's culture. Perhaps they cannot mould or dictate it, but it may even be faintly ridiculous to say that someone could be a leader without the ability to exert influence on the way their company is run. This essay will explore the ways in which leaders can be a force in influencing corporate culture.
It is a paradox to say that a leader is an un-influential figure. If one cannot influence people, one cannot lead. Visionary leadership shapes company culture and is vital for corporate success. In 4 Pillars of Success, Dan Sanders discusses the importance of 'leadership with accountability' to securing long-term corporate stability. "we never get away from the responsibility part of it as a leader", he says. 'We delegate authority to folks to make decisions on our behalf...but the responsibility is still ours' (Sanders, p. 28, 2009). This supports the idea that a leader is not a detachable part of an organisation, but an intrinsic element of its success. Leadership style is integral to corporate culture as it influences how all the members of an organisation move together towards a common goal. A bad leader of people will earn no respect from their employees and the company culture will be correspondingly that of mistrust, hostility and caution.
We can begin by analysing some obvious cases of leaders shaping their organisations. Bill Gates of Microsoft, Richard Branson of Virgin and Donald Trump of Trump Organisation are all supremely successful examples of influential leaders. These individuals have incorporated their personal values into their organisations and they way they conduct business seems to reflect their personalities, attitudes and style. Through popular media, we are all aware of Richard Branson's fun, no-nonsesnse approach and 'can do' attitude, Donald Trump's resilience and shrewd business sense and Bill Gates' passion for innovation and commitment to responsible business practice that is complemented by his personal charity, the Bill Gates Foundation. Academics such as Scott Prudham have commented on Richard Branson's entrepreneurial spirit and his capacity for making personal interests or concerns, such as environmental responsibility, a driving force in his work. In 'Pimping climate change', Prudham examines Branson's commitment to extend his personal concerns about the environment to pledging 1.6 billion British pounds to fighting climate change. That is an excellent example of an influential corporate figure.
Visionary leadership of this kind is the easiest in terms of pinpointing a leader's ability to influence culture. Vision and charisma are not something that everyone in a position of authority possesses. However, few become leaders by accident, and whoever becomes a leader must, be definition, have a degree of ambition and drive to succeed, and is therefore motivated to make a difference and take charge of others. Even if leaders do not generate their own ideas for change, response to trends in management are still a way of influencing corporate culture. Individual leaders may not be responsible for the growing demand in the modern employment market to find meaningful work, for instance, but the ability ' "to provide and manage meaning" through leadership or organizational culture' (Lips-Wiersma, Morris, p.491, 2009) is a key concept of being a leader, and gives potential for influence. A leader can take an idea and perpetuate it throughout their organisation, affecting how their company does business.
Occasionally, leaders do become trapped in their own bubble and seem to have little to do with the organisation or its culture on the whole. Do you have CEO disease? suggests that leaders can be too absorbed in the information vacuum around them to notice company changes, and are isolated from the overall company culture. In return, they begin to be ostracised, feared and disrespected. Leadership requires effective training, and relies on the leader's ability to exhibit integrity and loyalty to the workforce, which builds trust. Not everyone has the capacity for this, and these leaders may be less able to influence company culture than their more motivates colleagues. However, this does not take away from their capacity to do so - merely shows that they are not willing or able to exploit their opportunities.
It is also important to remember that leaders don't just go from the top, they are spread throughout the company. Leaders in an organisation are not just the ones making the executive decisions, but all their helpers and subsidiaries throughout the veins of the business. All of these individuals have the potential to feed company culture. In Where do we go from here? (Craig, Charles, Henry, 2009), the authors discuss strategies for effective team leadership which may lead to more success than 'simple downward influence from a hierarchical leader' (p. 234). They argue that teams 'consistently outperform' centralised leadership companies, as all team members are engaged and everyone has a say in making decisions. This leads to a healthier, more egalitarian company culture. Thus we need to challenge our traditional conception of one, single, executive leader and accept a more broad-minded view where an organisation may have multiple leaders, all playing a hand in shaping company culture. Indeed, shared leadership may the very culture of the company in itself.
Leadership is also not limited to decision-making, delegation of responsibility or going towards a goal. It can, importantly, take the form of motivation, support or spiritual guidance. Company culture is more than just about how the company goes about its operations and includes the ethos in the workplace, issues such as work-life balance and lifestyle habits, and spirituality.
Trust is a major issue in the workplace. If employees feel that the company and their leader have their best interests at heart, this leads to far more productive and committed work. In his book, 'Perspectives on Leadership: From the Science of Management to Its Spiritual Heart', Gilbert Fairholm states that 'Leaders play a major role in helping us shape our life. Leaders define business and its practice. They determine the character of society. They define our teams, groups and communities. They set and administer government policy. In all walks of life, leaders' behaviours set the course others follow and determine the measures used to account for group actions". Thus the author suggests that, whilst it's easy to think of leaders in terms of authority, it is also important to think about the 'total task of leadership', with the leader as a trust figure, guide and support for their inferiors.
Personal experience would tell all of us that brusk, hostile and incompetent leaders cannot help but affect the culture of the workplace. Leaders are, first and foremost, people - and like all people, they exude positive or negative qualities that affect the environment around them. As the most prominent figure in the workplace, the scale of this influence is magnified by a leader.
A leader can achieve much if they know how to translate their personal qualities into company culture. DAY & Zimmerman CEO, Harold Yoh explores this in his article, 'From Values to Leadership: Translating a CEO's Personal Commitment into a Company Culture'. The article details Yoh's determination to make 'safety, integrity, diversity and success' paramount in the company, breaking down the components of maintaing the system-wide change can't happen from the bottom up,' he says. 'For values to truly permeate the company culture and become the foundation for decisions that power our vision, they must live and breathe first and foremost in the CEO's office, and expand throughout the senior leadership and the balance of the organisation'.
As in the DAY & Zimmermann example, company culture can directly apply to company performance. Authors Yong and Pheng talk of the importance of organisational culture in implementing total quality management of Singapore building contractors. They argue that firms with a strong, comprehensive structure tightly implement the TQM elements of top management leadership, which can be crucial in setting the quality of work. Firms with a strong influence of management over the ethos of the company may therefore produce better work in this particular industry.
