managerial skills literature review

What do we know about managerial ability? A systematic literature review

• Published: 06 July 2021
• Volume 73 , pages 1–30, ( 2023 )

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• Puspita Ghaniy Anggraini   ORCID: orcid.org/0000-0002-6788-1493 1 &
• Mahfud Sholihin   ORCID: orcid.org/0000-0003-0773-4501 1  

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This study aims to analyze the trends, progress, and opportunities for future research on managerial ability literature. Since receiving a lot of attention after the study of Demerjian et al. (Manag Sci 58:1229–1248, 2012. http://doi.org/10.1287/mnsc.1110.1487 ), there has been no literature review study on managerial ability research. Using a systematic review process, this study includes 120 papers. The studies’ period ranged from 1974 to 2020. The findings of this literature review are presented in two parts, namely (1) a discussion of trends in the five classifications (topics, research settings, theories, methods, and primary data analysis techniques) and the current progress in existing studies; and (2) suggestions for future research. We classify suggestions for future research into nine themes: firm performance, capital market, reporting quality, auditing, investment decisions, financial decisions, tax, corporate social responsibility, and others. In addition, the development of managerial ability definition over time is provided prior to the literature review findings.

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adapted from Hoque ( 2014 ) with modification

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33 of 120 articles.

Demerjian et al. ( 2009 ) is the working paper version of Demerjian et al. ( 2012 ).

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Acknowledgements

We would like to thank Deputy for Research and Development Empowerment, Ministry of Research and Technology/National Innovation Agency for the financial support provided for this study. This study is funded by the Ministry of Research and Technology/National Innovation Agency of the Republic of Indonesia under the scheme of PMDSU, contract number 2141/UN1/DITLIT/DIT-LIT/PT/2020.

This study is funded by the Ministry of Research and Technology/National Innovation Agency of the Republic of Indonesia under the scheme of PMDSU, contract number 2141/UN1/DITLIT/DIT-LIT/PT/2020.

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Anggraini, P.G., Sholihin, M. What do we know about managerial ability? A systematic literature review. Manag Rev Q 73 , 1–30 (2023). https://doi.org/10.1007/s11301-021-00229-6

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Received : 31 January 2021

Accepted : 29 June 2021

Published : 06 July 2021

Issue Date : February 2023

DOI : https://doi.org/10.1007/s11301-021-00229-6

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Programme management involves the alignment; coordination and execution of a portfolio of construction projects to achieve certain benefits that are not always possible if the projects are managed individually. Programmes have always been complex in nature, with the potential for intense cross-project integration, conflicting stakeholders and socio-econo-political pressures. Any problems from one project automatically affect others in the programme. With this high level of synergy and integration, programmes require highly skilled and competent managers to ensure that they are operated and delivered successfully. The complexity of programmes, and their roots in project management, brings about pressure for the managers to think and rethink, search and research, and view and review, for skills and competencies that can put them at the top of their demanding jobs. The findings in this research were achieved through a triangulation of literature review, industrial questionnaire survey, and semi-structured interviews conducted with programme management experts. The paper offers a critical review and an analysis of the skills and competencies required by programme managers to effectively discharge their responsibilities. The number of skills and competencies was reduced and categorised using factor analysis for the ease of administration and training by managers and educators.

Jonathan Lean , Déirdre O'Byrne

Journal of Workplace Learning

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Management Skills: Literature Review

The current literature review describes the main qualities and skills possessed by modern managers. Gillard and Price (2005) state that critical thinking is one of the main concepts and practices used by managers to grow and develop their strategic position. Good managers do much more than make good decisions, a broad view of the decision-making process provides a useful starting point from which to understand what groups must do. As managers and entrepreneurs, we should have confidence in our decisions, but it is a difficult task because of the turbulent market environment and changing economic conditions.

Grugulis (2009) and Madsen and Musto (2004) underline that it is difficult for a manager to be confident in his decision-making because a hallmark of the modern business environment is its chaotic nature In the organization, two types of decisions can be singled out: programmed (complex) and non-programmed (routine). Non=programmed decisions require more attention and excellent decision-making skills because there are outcomes that are difficult to predict and foreshadow. To ensure effective skills, a manager should take into account the following steps; information gathering; problem innovation; option selection; implementation; evaluation; feedback, learning, and refinement. For managers and entrepreneurs, the effective planning and managing process is one of the effective decision-making tools which help to ensure confidence and effectiveness of the decision. Some public sector bodies are primarily keen on evaluation, though for reasons which have more to do with accountability than with learning. failure to reappraise initially rejected alternatives, poor information search, selective bias in processing information available, and failure to work out contingency plans.

Myers et al (2004) state that in complex environment, it is really difficult for managers to have confidence in decision making. Critical thinking skills and cognitive processes are essential to get one from a particular situation to a more disengaged perspective. It is then sometimes argued that social, political, and legal institutions, along with the corporate culture and the particular roles and role responsibilities of the managers and companies in question, create a causal nexus that constrains what might consider morally appropriate behavior and often precludes the consequential avoidance of harm. In contrast to traditional decision-making,

The researches selected for analysis do not contain subjective or questionable information. All issues and problems are carefully analyzed and evaluated in terms of management theory. All decisions are affected by bounded rationality which means that managers have limited resources and time for decision making, so an ideal solution is impossible in any circumstances. Managers have imperfect and incomplete information, so they cannot objectively evaluate facts and data crucial for the decision-making. Management makes the right decisions about who to hire more often than not when an applicant screening system is effective. Management makes these correct decisions by hiring people who perform up to or exceed expectations (correct hires) and rejecting those applicants who would have been less than satisfactory performers on the job. Although management would prefer to be 100% accurate in these predictions such omniscience is impossible. The authors agree that management can make two types of wrong decisions when hiring from a group of applicants. The first mistake is to hire someone who performs below expectations on the job. These people are the incorrect hires. Failure to hire people who would have been satisfactory performers but never got the chance to show their stuff is the second mistake. These people are the incorrect nonhires. Managers are sensitive to the first type of hiring mistake because an individual performing below expectation must be retrained or terminated. Hiring mistakes of this kind cause expense and inconvenience to the organization and are highly visible.

Gillard, Sh., Price, J. 2007. The Competencies of Effective Project Managers: a Conceptual Analysis. International Journal of Management , 22 (1), p. 54.

Grugulis, i. 2009. Skills, Training and Human Resource Development: A Response. Economic and Labor Relations Review , 19 (1), p. 65.

Madsen, S. R., Musto, A. l. 2004. Traits, Skills and Knowledge Required of Successful Human Resource Leaders. Journal of Applied Management and Entrepreneurship , 9 (1), p. 76.

Myers, M. et al. 2004. Maximizing the Human Capital Equation in Logistics: Education, Experience, and Skills. Journal of Business Logistics , 2 (1), p. 65.

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Managerial competences in public organisations: the healthcare professionals' perspective

Affiliations.

• 1 Department of Economics and Management, University of Parma, Via J. F. Kennedy, 6 - Parma, Italy. [email protected].
• 2 Department of Economics and Management, University of Parma, Via J. F. Kennedy, 6 - Parma, Italy.
• PMID: 32293450
• PMCID: PMC7158078
• DOI: 10.1186/s12913-020-05179-5

Background: Human resources play a critical role in encouraging efficient performance within organisations, especially for public healthcare organisations, where competences of staff are key aspects of the quality of services provided. In this context, the enhancement of competences are strategic objectives for Human Resources Management (HRM) in order to achieve excellent and lasting results. However, competences of healthcare professionals are both clinical and managerial. This study identifies specific managerial competences perceived as crucial by healthcare professionals in order to improve their performance and develop suitable HRM practices.

Methods: The research methodology was divided into three main phases using mixed methods, commencing with literature review to identify the initial framework about managerial competences. Focus groups were then used to discuss evidence from the literature. Feedback from focus groups was used to draft the final questionnaire. Finally, the answers to the questionnaire were analysed through statistical software.

Results: The results show that managers and professionals share a view of what specific managerial competences for healthcare organisations should be. Main competences are: quality evaluation based on outcomes; enhancement of professional competences; programming based on process management; project cost assessment; informal communication style; and participatory leadership.

Conclusions: Although the issue of managerial skills in healthcare is widely discussed in literature, findings are often fragmentary. Our work includes a systematic literature review useful for more empirical studies. Furthermore, our results can support public managers who want to set up positive HRM practices for healthcare professionals.

Keywords: Healthcare organisation; Human resource management; Hybrid management; Italy; Manager-physician; Managerial competences.

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Leadership and Managerial Skills in Dentistry: Characteristics and Challenges Based on a Preliminary Case Study

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Dentistry is changing rapidly in a dynamic and challenging mode and is incorporating digital technology, communication, and managerial skills for profitable enterprises. On the new dental horizon, the profession requires engaging and inspiring role models and leaders. Ιdentifying and developing human soft skills can improve quality issues and guarantee a sustainable dental business. The concept of leadership is a very complex and multidimensional phenomenon as observed from the current literature. In different commercial environments, there has been a huge discussion on the specific characteristics of an effective leader. In dentistry, the subject needs further investigation. This article aims to bring up the importance of dental leadership and highlights the need of identifying dental leaders committed to excellency. It also challenges the need for educational shift on dental leadership management. Finally, it aims to support and develop educational transformations based on positive preliminary data observed by incorporating a new, relevant subject in the dental curriculum.

1. Introduction

The word “leadership” is a derivative of the verb “lead”, which means “I am a leader and I lead others, who follow me willingly” [ 1 ]. Based on this etymology, leadership in the field of dentistry means the ability to influence or change the behaviors of one or more person. A leader is the one who provides the right environment for people to work. So, leadership is the process of influencing the thinking, feelings, attitudes, and behaviors of a small or large, formal or informal group of people in such a way that they voluntarily and willingly give their best [ 2 ]. There are multiple definitions of leadership (at least 350,000 within the academic literature) [ 3 ]. In dentistry, clinical leadership seems to be mentioned only once as “the skills required to provide effective patient care within a successful business” [ 4 ]. However, leadership has also other forms and seems to be more of a social process for goal attainment or an influence process [ 5 ]. Dental professionals are trained to integrate science in practice and education, have increased degrees of autonomy in judgments and clinical interventions, and are expected to be engaged in collaborative and interprofessional practices to achieve the best outcomes for patients, personnel, and organization [ 6 ]. Consequently, dental leaders are those who bring people together, help them communicate their needs and personal goals, inspire enthusiasm for a vision and a common mission, guide by example, take initiative, and ultimately gain the trust of the people around them [ 2 ]. They are also expected to substantially contribute to clinical outcomes through continuous quality improvement in patient care, create a supportive environment for their colleagues, and contribute to the development of their profession, healthcare systems, and healthcare policy [ 6 , 7 , 8 ].

Under this frame, the Association of Dental Education in Europe (ADEE) works on developing pan-European graduating clinicians who are trained in management and leadership [ 9 ]. Likewise, in Australia, leadership was embedded in the guide for professional competencies of newly qualified dentists [ 10 ] while the American Dental Association collaborated with experts in the field to provide a leadership educational framework [ 11 ]. A recent systematic review by Hanks et al. [ 5 ] and a doctoral dissertation thesis by Wardman [ 12 ] bring forward all leadership issues in the field of dentistry.

In this article, a discussion is evoked on the main leadership issues, the characteristics of an effective dental leader, and the approaches needed in dental education. Approaches are based on preliminary data retrieved from a new, relevant subject for leadership and managerial-skills enforcement in the dental curriculum of the Dental School of the National and Kapodistrian University of Athens, Greece.

2. Leadership Characteristics Needed in Dentistry

Characteristics needed for leadership evaluation could be addressed according to the organizational level of the dental business [ 5 , 13 ]. Starting from the strategic level, leadership is concerned about the systems in the (inter-) national level and regulating political issues concerning dentistry. In the second level, leadership is explored within dental associations, hospitals, or big dental units. Then, in the operational level, leadership is addressed within the team/group/unit emphasizing elements of practice (such as reception, surgery, aftersales service, etc.). In the tactical level that follows, leadership is referred to dyadic relationships mainly between colleagues. Finally, there is the individual level where leadership is needed for individual issues of one’s own evolution within the dental business framework.

The model of leadership that could be used in all the above levels defines more the competencies needed in the dental field. A simple, effective model is suggested to have five stages [ 14 ]. The first stage is that of position, where the leader has not yet attained real influence on people, and others follow him because of his role or position and because they are obliged to do so. No special competencies are needed in this stage since anyone can be the boss of a dental business. In the second stage, people agree to follow the boss because they want to. In this stage, good relationships with others are a crucial issue, where the leader should show not only his knowledge but how much he cares about others. So, in this stage, empathetic and emotional intelligence competencies are additionally needed. The third stage is that of production, where leaders help others to perform and bring results. In this stage, people follow the leader because of his results. Thus, he should have time management skills, creativity, problem solving and decision-making competencies. The fourth stage is the stage of evolution, where others follow the leader because of what he has done for them. Leaders in this stage are great not because of their power but because they concede power to others. They know how to create and communicate a vision, they are experienced, competent, supportive, respectful, self-determined, and consistent. The last seems to be a hidden stage in leadership evaluation in the healthcare business. Dentists, forced to attain productivity for themselves and their business, do not realize they should force the evolution of others in the unit/business. The last stage is where leaders gain respect of who they are, and others follow them for what they are or the values they represent.

Throughout the relevant literature, a specific set of skills or abilities are reported for all the above levels and stages of dental leadership [ 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 ]. A common key element of leadership in all the above levels is the value of accepting the self and others and be keen for excellency without following perfectionism, as mentioned in all theories about leadership (by Xenophon, Aristotle, Nietzsche, Blanchard, Covey, Collins, Goleman, and Barret, to name the most important ones who dealt with this issue). Leadership is also a practical matter. In other words, one simply needs to be able or willing to do himself what he asks others to do [ 23 ]. Many natural leaders have been already reported. However, although there are certain genetic qualities that can help accelerate the development of this ability, there is insufficient evidence that leadership exists in the human DNA [ 24 ]. In defense of this, it can be noted that gender does not play a role in the dynamics of leadership [ 25 , 26 ]. It also seems there are no clear features that predetermine the prospect of leadership, but people who are adaptable, social, and ambitious have a good chance of becoming leaders. It also appears that IQ index contributes less than 5% to the possibility of becoming a leader [ 24 ]. So, it is rather generally accepted that leadership behaviors stem from a combination of a small percentage of genetic and a large percentage of environmental factors, as is the case with other abilities and practices. It is worth noting that while some people may be born with these dynamics, they only develop their leadership skills by 30–60% over time [ 27 ].

3. Theories about Leadership and Suggested Competencies

The theories about leadership are many and through them one can outline the necessary characteristics that must distinguish leaders.

3.1. Theories of Individual Characteristics

These theories are based on the notion that the characteristics of a leader are related to his effectiveness. In 1981, Stogdill cited as essential characteristics, boldness, self-confidence, readiness, the ability to influence the behavior of other people, responsibility, and acceptance [ 28 ]. It was later reported that some positive elements of the personality of people with managerial positions such as optimism, determination, and self-discipline were directly related to the degree of success in their work [ 27 ]. The personality model of five factors, namely, extroversion, conscientiousness, affability, receptivity to experience, and lack of neuroticism, has been also reported. Research data show that extroversion has a particularly positive effect on leadership issues [ 29 ].

3.2. Behavioral Theories

Leadership ability, according to behavioral theories, is not a hereditary and innate process, but a complex, acquired skill that can be developed in different environments in many ways and depending on circumstances. Thus, there are three main styles of leadership behavior: (a) the authoritarian (the leader makes the decisions himself, without the participation of the group, which has only an executive role), (b) the democratic (the leader cooperates with the group and accepts advice and participation of others in decision making), and (c) the empowering leader (limited role and group decisions) [ 30 ]. Later, the behavior of a leader was given emphasis rather than his traits [ 2 , 31 , 32 ]. The managemental grid model that followed [ 33 ] mentioned two leadership dimensions: X, the interest in people, and Y, the interest in service. For the professional dentist, each dimension is graded from one to nine and the combination resulting from the grades of the two dimensions leads to a certain style of leadership. The larger the area determined by the two dimensions, the greater his leadership skill [ 2 ].

3.3. Leadership Theories Related to the Situation

According to theories related to specific situations, there are two leadership dimensions: (a) toward people and (b) toward tasks [ 34 ]. Every situation needs a combination of styles depending on the specific reality one must face [ 2 ]. Task-oriented leadership approaches are generally most effective in health enterprises where: (1) the team is limited by resources or time, (2) there is disruption in the structure and an order needs to be restored, (3) the leader works with many or nonqualified team members. People-oriented leadership approaches are more effective in the administrative tasks of the business. So, they are needed when there is an opportunity to develop the leadership skills of the staff and/or the need to motivate through new experiences and greater responsibility. We can also work on a more people-centered basis when working with a highly experienced, skilled, and competent team [ 35 ]. The level of maturity of the followers basically defines the most appropriate leadership style [ 36 ] as well as their degree of satisfaction of expectations from the leader [ 37 , 38 ]. It was finally reported that leaders can be effective in one situation but ineffective in another [ 39 ]. As it seems, the conditions prevailing in the environment act as a catalyst in the leadership style that one adopts [ 40 ].

3.4. New Approaches to Leadership

Modern approaches suggest the motivation of people derives from sharing a common vision and the sense of belonging to a common team. Recognizing the needs of partners and cultivating emotional intelligence are also important factors [ 41 , 42 , 43 ]. Under this scope, management of a dental business seems a different concept than leadership. Management is just doing things right, leadership is doing the right thing [ 44 ]; and management is transactional, while leadership is transformational [ 45 , 46 , 47 ]. In the field of health entrepreneurship, the approach to superleadership is also special [ 48 ]. Based on this theory, leaders should create a pyramid of leadership through the promotion of new leaders. By this sense, dental leadership principles reinforce dental management and make it more productive and effective.

4. Leadership Models in Healthcare

A well-used leadership model in the health sector is the nine-dimensional model of Britain’s National Health Service (NHS) [ 49 ] based not on the behavior of the followers but on a combination of emotional expressiveness, self-confidence, self-determination, resilience, and freedom from internal conflicts of the leader [ 35 , 38 , 43 ]. Setting the tone and culture of an organization is intertwined with resolving conflict, giving feedback, and creating a nonjudgmental learning environment for all [ 45 , 50 ], where there is no intimidation or fear [ 51 ]. A total of 30 leadership core competencies within (seven) leadership domains are discussed in Table 1 , endorsed by the dental field [ 6 , 51 , 52 , 53 , 54 , 55 , 56 , 57 , 58 , 59 , 60 ].

Domains, competencies, and characteristics of leadership.

5. Preliminary Report on a Leadership Educational Approach in Dental Education

In the dental school of the National and Kapodistrian University of Athens, Greece, a new course was introduced on leadership and dental management enhancement, pilot-tested to dental students in their eighth semester of undergraduate studies. The course was organized for two consequent years, since 2021, and was held during the spring semester. The course “Application of humanities and basic principles of coaching in dentistry” addresses leadership issues, humanities (philosophy, positive psychology), communication and time management skills, managerial and personal branding, and marketing issues. The educational process consisted of 13 weekly seminars of two hours each. The first hour explored theoretical issues of the modules, while the second hour was used for practical and experiential exercises derived from the main theme of the module. The 13 modules of the course specifically addressed the following issues: (1) vision, values, and goal setting in dental management, (2) time management in dentistry, (3) philosophical approach and ethics in dentistry, (4) the Aristotelian values in dental ethical leadership, (5) positive psychology introduction for health care professionals, (6) emotional intelligence reinforcement in dentistry, (7) motivation and mechanism of behavior changes in healthcare, (8) meditation in healthcare for resilience enhancement, (9) effective communication in dentistry, (10) setting healthy limits in dental business, (11) management of the success and failure in dental business, (12) management of fear in the dental business, and (13) strategic thinking for decision making, dental management and marketing in dental business.

Students were enrolled voluntarily in the course between March 2021 and June 2022 (N1 = 22). In the beginning of the course (beginning of the eighth semester each year–1st March) (t 0 ), students were asked on a voluntary basis to fill a questionnaire based on (a) time management, [ 61 ], (b) the level of emotional intelligence and resilience (FEEL) [ 2 ], and (c) collaboration issues [ 62 , 63 ]. The same questionnaire had to be filled again at the end of the course (end of the eighth semester, middle June each year) (t 1 ). Each of the students had chosen a personal code to anonymously fill the questionnaire in both time periods.

A total of 14 questionnaires were initially collected at t 0 for both academic periods (initial response rate 63.6%). A total of 12 questionnaires were finally collected at t 1 from the same participant (final response rate 54.5%). The most interesting preliminary findings concerned 80% improvement in time-management skills, especially procrastination and prioritization. A 72% improvement was observed in enhancing collaboration issues, a 68% improvement on addressing values and setting goals, and a 66% improvement on decision making. A 58% improvement was finally reported on emotional intelligence skills, self-confidence, and self-respect issues. Even though seminars and exercises were not organized in a 1:1 coaching session base but in a group mode, all participants reported positively on the importance of the course and the benefits gained over many leadership and management issues. Some limitations of this approach were the semester that the subject was launched (eighth) when all students were trying to cope with newly addressed clinical skills, had no breaks between courses, and were reluctant to choose another course with no obvious result at this period of their studies. Additionally, in the first year of running the course, seminars were introduced via e-learning due to the COVID-19 pandemic, possibly diminishing the impact of personal involvement in the issues discussed and the exercises performed within the group.

6. Discussion

Sustainability issues of the dental profession cause the need to treat every single graduating and graduated dentist as a potential leader toward himself, patients, and colleagues. Unfortunately, so far, technical skills development is focused on, while leadership training remains behind. Dental schools and curricula represent the best opportunity to start training the future generation of dentists who will be able to perform in an excellent clinical and professional manner.

Leadership educational interventions are suggested to include a scaled module [ 64 , 65 ]. Initially, dental students could be introduced to basic theoretical issues of emotional intelligence and time management while, in the meantime, they perform different educational activities in small working groups. More specifically, the educational framework should encourage dental students’ engagement in (a) teamwork activities where all members should have specific roles and responsibilities, (b) working groups for active listening and emotional intelligence improvement, (c) mentoring by trained academic staff, and (d) coaching by trained coaches to surpass negative personal beliefs, deal with stress issues, or manage failure. Under this scope, the role of an educator, coach, or mentor should be enhanced from the beginning of studying dentistry until graduation. The mentor could present students with motivation to achieve not only clinical excellency but also strategic leadership excellency in all fields of human resources management addressed in dentistry [ 66 , 67 ]. The desire to stand out, to become better, and to make a difference in the dental field is inherent. It leads down the path of personal development, making students better dentists and entrepreneurs [ 68 , 69 , 70 , 71 ].

By this approach, the accountable future dental professional leader will ensure excellence and quality assurance in the dental units by addressing: (1) people and managing talent [ 10 ], (2) vision and legacy of success in the system [ 72 ], (3) culture of excellent clinical performance and ethics [ 73 ], (4) quality assurance policies [ 74 ], (5) effective teamwork [ 13 , 75 ], (6) quality of patient care [ 5 ], (7) inspiring relationships based on mutual trust [ 2 , 76 ], (8) quality and ensuring healthy dental workplaces [ 51 ], (9) well-being at work [ 2 , 51 , 70 , 77 , 78 ], and (10) reduction of bullying in the dental work field [ 19 , 77 , 78 ].

Although limited, data from the above educational experience are optimistic on the changes expected in students’ mindsets on leadership and dental management issues. Information retrieved in a more extended scale from running the course will be addressed accordingly in the future. No doubt this is an interesting and promising research field and will excel human resources management education in dentistry. Future research should be encouraged to propose and define specific techniques and modules concerning human soft skills enhancement for next generation dental professionals.

7. Conclusions

Dental leadership can be learned and exercised in modern educational programs. Further research is needed to provide data on leadership teaching approaches based on scaled modules and measuring the core leadership competencies before and after interventions.

Funding Statement

This research received no external funding.

Informed Consent Statement

Informed consent was obtained from all subjects involved in the study.

Data Availability Statement

Conflicts of interest.

The author declares no conflict of interest.

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California Management Review

California Management Review is a premier academic management journal published at UC Berkeley

CMR INSIGHTS

Are we asking too much leadership from leaders.

by Herman Vantrappen and Frederic Wirtz

Image Credit | Nick Fewings

Leaders do not have an easy time. In the assumption that the headlines in the management literature are a reliable guide, leaders are expected not only to be brilliant but also servant, humble, transformational, vulnerable, authentic, emotionally intelligent, empathetic, unlocked and connecting – at the least. 1-9 That is a tall order, even for those who are labelled superhuman.

Related CMR Articles

“Transformational Leader or Narcissist? How Grandiose Narcissists Can Create and Destroy Organizations and Institutions” by Charles A. O’Reilly & Jennifer A. Chatman

Fortunately, leaders may not need to take all those exhortations too serious, or certainly not too literal. To begin with, some scholars warn of the shaky grounds of several leadership constructs. For example, Katja Einola et al. point to authentic leadership theory as an example of a “dysfunctional family of positive leadership theories celebrating good qualities in a leader linked with good outcomes and positive follower ‘effects’ almost by definition.” 10 They add that leadership studies should “raise the bar for what academic knowledge work is and better distinguish it from pseudoscience, pop-management, consulting, and entertainment.” Ouch!

Other scholars are adding precautions about the potentially detrimental effects of certain leader behaviors both for the leaders themselves and for the organizations they lead. For example, Joanna Lin et al. point to leader emotional exhaustion resulting from transformational leader behavior. 11 Charles O’Reilly et al. warn of the substantial overlaps of transformational leadership with grandiose narcissism. 12

Still other scholars emphasize that leadership skills are context-specific. For example, Raffaella Sadun emphasizes that the most effective leaders have social skills that are specific to their company and industry. 13 Nitin Nohria points out that charisma often is a liability, yet charismatic leaders can be especially useful at entrepreneurial startups and in corporate turnarounds. 14 Jasmin Hu et al. indicate that humble leaders are effective only when their level of humility matches to what team members expect. 15

The above tells us two things, whether we are a leader or a follower. First, the pertinence of a particular leader behavior depends on the situation. Second, we should temper our expectations of the effect of that behavior. But even then, the question remains: Are we demanding too much from leaders? The answer is nuanced: No, we cannot demand too much; but the real question is how we could lessen the need for those demands to emerge in the first place.

Reading the definitions of those leader behaviors, it would be hard to argue we are demanding too much. Just consider the following examples:

• Servant leaders “place the needs of their subordinates before their own needs and center their efforts on helping subordinates grow.” 1
• Humble leaders “are willing to admit it when they make a mistake, they recognize and acknowledge the skills of those they lead, and they continuously seek out opportunities to become better.” 16
• Vulnerable leaders “intentionally open themselves up to the potential of emotional harm while taking action (when possible) to create a positive outcome.” 4
• Emotionally intelligent leaders “are conscious about and responsive to their emotions, possessing the ability to harness and control them in order to deal with people effectively and make the best decisions.” 17
• Empathetic leaders “genuinely care for people, validate their feelings, and are willing to offer support.” 7
• Connecting leaders “concurrently contend with identities, actions, emotions of a leader and a follower.” 9

While these demands on leaders are pertinent, they are also taxing in terms of time and energy. To solve the quandary, we should look for ways to lessen the need for those demands to emerge in the first place. On many occasions, leaders at the top are led to activate the afore-mentioned behaviors because doubts, disagreements, tensions, trade-offs and eventually conflicts by and between people in the field are allowed to escalate. These frictions may emerge and escalate to the top for all kinds of reasons but they often land there due to organizational design faults: Some designs are intrinsically frictional; others lack mechanisms to resolve friction at origin. Precluding these design faults requires craftsmanship in organization design.

Let us take a stylized example. Laura is the commercial manager in charge of the Brazil region at Widget Inc. As sales this year are going more slowly than planned, she is desperately trying to win a specific new client. To have any chance of winning, she must be able to offer a special off-catalogue product. So she turns to Lucas, the global manager in charge of the product line concerned, who unfortunately has to tell her that the manufacturing plant is fully booked for the next six months, leaving no capacity for the mandatory testing of the special product for her client in Brazil. Tension rises, and the issue escalates to their respective bosses, the EVP Regions and the EVP Products. Unfortunately, these two do not manage to agree on a solution either. Even worse, the incident degenerates into an acrimonious confrontation at the company’s next executive team meeting, where the two blame each other for a chronic lack of flexibility.

The originally operational issue thus lands with a thick thud on the CEO’s desk. After suppressing a deep sigh, she activates various leader behaviors. She is empathetic (“I sense how strongly you both feel about this important matter …”), servant (“I don’t blame you for bringing this to my attention …”), humble (“I realize I should have put in place a way of preventing issues like this …”), vulnerable (“In fact, I once struggled myself with a similar issue …”), and more…

The CEO may be doing all the right things at that moment, but could she have been spared the onus of dealing with the originally operational friction if only the company’s organization had been designed differently? Widget Inc.’s organization architecture features two equally-weighted primary verticals, i.e., “region” and “product”, both having full P&L responsibility, hence competing with each other directly for resources, decision power and attention. While there is no general rule that such an architecture must not be chosen, in general it tends to be an intrinsically frictional design.

The general message for leaders is: When you seek remedies for pain points in your organization, do not count on leader behavior only, but check also for architectural design faults or ambiguities. Here are three examples, each linked to a variable that defines an organization’s architecture.

1. The primary vertical

Small mono-product and mono-market companies tend to have a function-based architecture (e.g., product development, purchasing, production, sales, distribution, after-sales). At large companies, that architecture can be intrinsically frictional. For example, if you are in the business of developing, constructing and maintaining power plants worldwide, the business development people, when they make a bid, might be tempted to foresee low maintenance costs so as to increase their chances of winning the bid. Alas, if the bid is won, the maintenance division will bear the brunt. Such operational tension is inherent to this type of business, but you do not want that tension to constantly manifest itself at the C-suite level. Therefore, consider having “region” rather than “function” as primary vertical and then setting up a function-based organization within each region. 18

2. The corporate parent

Each of a company’s business entities has specific objectives, challenges and priorities. Imagine your company has a mix of large businesses operating in its mature home market and small ventures in promising overseas markets. The latter may be keen to tap into the talent and knowledge that reside in the former, while the former may be reluctant to lend to the latter. Obviously, you do not want every such request and refusal to be elevated to the C-suite level. A global knowledge management and talent mobility system could solve the problem, and you might expect the businesses, out of enlightened self-interest, to set it up among themselves. Alas, that is unlikely to happen, as the benefits are contingent on participation by all businesses. Therefore, consider having a corporate function kick-start the initiative. 19

3. Lateral coordination

Imagine that your organization architecture consists of business entities focused on “product” and others on “customer segment”. Even though these entities by design are relatively self-contained, “product” and “customer segment” still need to coordinate daily on operational matters, such as defining product specs, setting price levels, launching commercial campaigns, etc. Hence you decide to create a matrix, with sales managers reporting both to a product line manager and a customer segment manager. And you expect these matrixed sales managers to make the best possible trade-offs between the partially diverging interests of their two bosses. Alas, a matrix between two verticals with P&L responsibility tends to be intrinsically frictional. 20 The matrixed manager’s anxiety about role conflict and their bosses’ fear of power loss may create festering conflicts escalating to the C-suite level. Therefore, in this case, consider a soft-wired coordination mechanism (such as a periodic joint planning cycle) instead of a hard-wired matrix. 

There are many other examples of organization design faults or ambiguities, not only related to organizational architecture but also to governance, business processes, company culture, people and systems. Admittedly, the perfect organization design does not exist – tension and friction are a fact of corporate life. And we could hardly demand too much authenticity, emotional intelligence, empathy and other commendable behaviors from our leaders, as described at start. But there is an issue when senior leaders are compelled to activate these behaviors to resolve internal conflicts that should not have escalated to the top of the organization. By identifying and removing glaring design faults and ambiguities about roles, we can help lessen the emergence and escalation of such conflicts, and consequently reduce the opportunity cost of senior leaders devoting energy and time to resolving stoppable conflicts. Senior leaders had better focus on genuine people issues, external stakeholders, and the organization’s strategic choices.

References

R.C. Liden, S.J. Wayne, H. Zhao and D. Henderson, “Servant Leadership: Development of a Multidimensional Measure and Multi-Level Assessment,” The Leadership Quarterly 19, no. 2 (2008): 161-177..

E.H. Schein and P.A. Schein, “Humble Leadership: The Power of Relationships, Openness, and Trust,” 2nd ed. (Oakland: Berrett-Koehler Publishers, 2018).

B.M. Bass, “Leadership and Performance Beyond Expectations” (New York: John Wiley & Sons, 1985).

J. Morgan, “Leading with Vulnerability: Unlock Your Greatest Superpower to Transform Yourself, Your Team, and Your Organization” (New York: John Wiley & Sons, 2023).

B. George, “Authentic Leadership: Rediscovering the Secrets to Creating Lasting Value” (New York: Jossey-Bass, 2004).

D. Goleman, “The Emotionally Intelligent Leader” (Boston: Harvard Business Review Press, 2019).

O. Valadon, “What We Get Wrong About Empathic Leadership,” Harvard Business Review, Oct. 17, 2023.

H. Le Gentil, “The Unlocked Leader: Dare to Free Your Own Voice, Lead with Empathy, and Shine Your Light in the World” (New York: John Wiley & Sons, 2023).

“The Connecting Leader: Serving Concurrently as a Leader and a Follower,” ed. Z. Jaser (Charlotte: IAP, 2021).

K. Einola and M. Alvesson, “The Perils of Authentic Leadership Theory,” Leadership 17, no. 4 (2021): 483-490.

J. Lin, B.A. Scott and F.K. Matta, “The Dark Side of Transformational Leader Behaviors for Leaders Themselves: A Conservation of Resources Perspective,” Academy of Management Journal 62, no. 5 (2019): 1556-1582.

C.A. O’Reilly and J.A. Chatman, “Transformational Leader or Narcissist? How Grandiose Narcissists Can Create and Destroy Organizations and Institutions,” California Management Review 62, no. 3 (2020): 5-27.

R. Sadun, “The Myth of the Brilliant, Charismatic Leader,” Harvard Business Review, Nov. 23, 2022.s

N. Nohria, “When Charismatic CEOs Are an Asset — and When They’re a Liability,” Harvard Business Review, Dec. 1, 2023.

J. Hu, B. Erdogan, K. Jiang and T.N. Bauer, “Research: When Being a Humble Leader Backfires,” Harvard Business Review, April 4, 2018.

T.K. Kelemen, S.H. Matthews, M.J. Matthews and S.E. Henry, “Essential Advice for Leaders from a Decade of Research on Humble Leadership,” LSE Business Review, Jan. 17, 2023.

S.T.A. Phipps, L.C. Prieto and E.N. Ndinguri, “Emotional Intelligence: Is It Necessary for Leader Development?” Journal of Leadership, Accountability & Ethics 11, no.1 (2014): 73-89.

H. Vantrappen and F. Wirtz, “When to Change Your Company’s P&L Responsibilities,” Harvard Business Review, April 14, 2022.

H. Vantrappen and F. Wirtz, “How To Get a Corporate Parent That Is Better For Business,” California Management Review, March 5, 2024.

J. Wolf and W.G. Egelhoff, “An Empirical Evaluation of Conflict in MNC Matrix Structure Firms,” International Business Review 22, no. 3 (2013): 591-601.

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Starting a business is an exhilarating journey that requires more than just a great idea. It demands a versatile skill set and a resilient mindset.

While entrepreneurship is often glamorized in media and popular culture, portraying a life filled with success, freedom, and excitement, the reality can be markedly different and far less glamorous. Many entrepreneurs face a myriad of challenges that are seldom highlighted.

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Because the journey of entrepreneurship has its challenges, here are the top five essential skills every entrepreneur should cultivate to enhance their chances of success:

1. adaptability.

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Being able to articulate ideas clearly and persuade others is invaluable. Entrepreneurs often need to communicate with a variety of stakeholders including employees, investors, customers, and partners. Effective communication enhances leadership, fosters team alignment, and attracts investment. Additionally, networking is essential for building relationships that can lead to new opportunities, valuable advice, and increased support.

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By nurturing these top five skills, entrepreneurs can not only navigate the complexities of launching and growing a business but also pave the way for sustained success and innovation.

Melissa Houston, CPA is the author of Cash Confident: An Entrepreneur’s Guide to Creating a Profitable Business and the founder of She Means Profit . As a Business Strategist for small business owners, Melissa helps women making mid-career shifts, to launch their dream businesses, and I also guide established business owners to grow their businesses to more profitably.

The opinions expressed in this article are not intended to

replace any professional or expert accounting and/or tax advice whatsoever.

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