What every leader needs to know about followers

Countless studies, workshops, and books have focused on leaders--the charismatic ones, the retiring ones, even the crooked ones. Virtually no literature exists about followers, however, and the little that can be found tends to depict subordinates as an amorphous group or explain their behavior in the context of leaders' development. Some works even fail to sufficiently distinguish among varying types of followers--barely registering the fact that those who tag along mindlessly are a breed apart from those who are deeply devoted and consciously, actively involved. These distinctions have critical implications for the way leaders should lead and managers should manage, according to Kellerman, a professor at Harvard's Kennedy School of Government. Additionally, today's followers are influenced by a range of cultural and technological changes that have affected what they want and how they view and communicate with their ostensible leaders. In this article, Kellerman explores the evolving dynamic between leaders and subordinates and offers a typology that managers can use to determine and appreciate how their followers are different from one another. Using the level of engagement with a leader or group as a defining factor, the author segments followers into five types: Isolates are completely detached; they passively support the status quo with their inaction. Bystanders are free riders who are somewhat detached, depending on their self-interests. Participants are engaged enough to invest some of their own time and money to make an impact. Activists are very much engaged, heavily invested in people and process, and eager to demonstrate their support or opposition. And diehards are so engaged they're willing to go down with the ship--or throw the captain overboard.     

When followers become toxic

Leaders are vulnerable, too. That is, they can be led astray just as their followers can--actually, by their followers. This happens in a variety of ways. Sometimes, good leaders end up making poor decisions because well-meaning followers are united and persuasive about a course of action. This is a particular problem for leaders who attract and empower strong followers. These executives need to become more skeptical of the majority view and push followers to examine their opinions more closely. At other times, leaders get into trouble because they are surrounded by followers who fool them with flattery and isolate them from uncomfortable realities. Charismatic leaders, who are most susceptible to this problem, need to make an extra effort to unearth disagreement and to find followers who are not afraid to pose hard questions. Organizational mechanisms like 360-degree feedback and executive coaching can help these leaders get at the truth within their companies. Finally, unscrupulous and ambitious followers may end up encroaching on the authority of the leader to such an extent that the leader becomes little more than a figurehead who has responsibility but no power. There's not much leaders can do to completely guard against a determined corporate lago, but those who communicate and live by a positive set of values will find themselves better protected. And since followers tend to model themselves after their leaders, the straightforward leader is less likely to have manipulative followers. In this article, George Washington University professor Lynn Offermann explores each of these dynamics in depth, arguing that leaders need to stir debate, look for friends who can deliver bad news, and communicate and act on a solid set of values.     

The tests of a prince

When a CEO takes office, stakeholders dissect his or her intellectual, physical, and emotional capacities as they try to gauge whether the new leader will help them fulfill their aspirations and protect them from trouble. For the heir to a family business, the challenge of turning stakeholders into followers is particularly thorny: He or she must manage many constituencies--family members, directors, senior executives, investors, trade unions--that may not be convinced the successor has earned the right to hold the top spot. Making matters worse, says Lansberg, a family business expert, corporate scions usually ignore or greatly underestimate stakeholders. They don't realize that, particularly after they are formally anointed as CEOs, they must establish their credibility with and authority over these spheres of influence. Smart CEOs understand that their success depends on how well they respond to the iterative testing process that stakeholders use to make judgments about would-be leaders. This article offers a road map for managing the four kinds of tests that constitute iterative testing: Qualifying tests are assessments based on criteria--such as formal education, work experience, and professional awards--that executives can cite as evidence of suitability for the top job. Self-imposed tests are expectations that leaders themselves set and against which they assume stakeholders will measure their performance. Circumstantial tests are unplanned challenges or crises, during which stakeholders can observe the leader coping with the unexpected. And political tests are challenges from rivals who want to enhance their own influence, often by undermining the leader.     

Managing authenticity: the paradox of great leadership

Leaders and followers both associate authenticity with sincerity, honesty, and integrity. It's the real thing--the attribute that uniquely defines great managers. But while the expression of a genuine self is necessary for great leadership, the concept of authenticity is often misunderstood, not least by leaders themselves. They often assume that authenticity is an innate quality--that a person is either genuine or not. In fact, the authors say, authenticity is largely defined by what other people see in you and, as such, can to a great extent be controlled by you. In this article, the authors explore the qualities of authentic leadership. To illustrate their points, they recount the experiences of some of the authentic leaders they have known and studied, including the BBC's Greg Dyke, Nestlé's Peter Brabeck-Letmathe, and Marks & Spencer's Jean Tomlin. Establishing your authenticity as a leader is a two-part challenge. You have to consistently match your words and deeds; otherwise, followers will never accept you as authentic. But it is not enough just to practice what you preach. To get people to follow you, you also have to get them to relate to you. This means presenting different faces to different audiences--a requirement that many people find hard to square with authenticity. But authenticity is not the product of manipulation. It accurately reflects aspects of the leader's inner self, so it can't be an act. Authentic leaders seem to know which personality traits they should reveal to whom, and when. Highly attuned to their environments, authentic leaders rely on an intuition born of formative, sometimes harsh experiences to understand the expectations and concerns of the people they seek to influence. They retain their distinctiveness as individuals, yet they know how to win acceptance in strong corporate and social cultures and how to use elements of those cultures as a basis for radical change.     

Observational Learning from Acquisition Outcomes of Innovation Leaders

We examine how learning from observing the acquisition outcomes of innovation leaders affects the acquisition decisions and performance of followers in an industry. Followers tend to increase the probability of acquisition and the size of an acquisition when innovation leader acquisitions produce more favorable outcomes, and reduce both when innovation leader acquisitions suffer more unfavorable outcomes. Industry competition, environmental uncertainty, prior acquisition experience, geographic proximity, and managerial incentives are important mechanisms affecting observational learning in acquisitions. Follower acquisitions perform better when innovation leaders’ acquisition outcomes convey more favorable signals, and more poorly when they convey more unfavorable signals.     

Leadership based on asymmetric information

Rational players, unconstrained by contracts or formal authority, choose to follow a better‐informed leader, whose action reveals part of her information. If the leader satisfies a credibility condition, then the unique nondegenerate equilibrium solves distinct shirking and coordination problems and achieves the first best. If credibility fails, as is more likely for a large organization, then followers ignore the leader, and equilibria are very inefficient. Appointing multiple leaders, or a high‐cost leader, can restore credibility. If players invest privately in information, then a leader often appears endogenously. The equilibrium concept is an original extension of sequential equilibrium to continuous states.     

Putting leaders on the couch. A conversation with Manfred F. R. Kets de Vries. Interview by Diane L. Coutu

Much of the business literature on leadership starts with the assumption that leaders are rational beings. But irrationality is integral to human nature, and inner conflict often contributes to the drive to succeed. Although a number of business scholars have explored the psychology of executives, Manfred F.R Kets de Vries has made the analysis of CEOs his life's work. In this article, Kets de Vries, a psychoanalyst, author, and instead professor, draws on three decades of study to describe the psychological profile of successful CEOs. He explores senior executives' vulnerabilities, which are often intensified by followers' attempts to manipulate their leaders. Leaders, he says, have an uncanny ability to awaken transferential processes--in which people transfer the dynamics of past relationships onto present interactions--among their employees and even in themselves. These processes can present themselves in a number of ways, sometimes negatively. What's more, many top executives, being middle-aged, suffer from depression. Mid-life prompts a reappraisal of career identity, and by the time a leader is a CEO, an existential crisis is often imminent. This can happen with anyone, but the probability is higher with CEOs, and senior executives because so many have devoted themselves exclusively to work. Not all CEOs are psychologically unhealthy, of course. Healthy leaders are talented in self-observation and self-analysis, Kets de Vries says. The best are highly motivated to spend time on self-reflection. Their lives are in balance, they can play, they are creative and inventive, and they have the capacity to be nonconformist. "Those who accept the madness in themselves may be the healthiest leaders of all," he concludes.     

The great intimidators

After Disney's Michael Eisner, Miramax's Harvey Weinstein, and Hewlett-Packard's Carly Fiorina fell from their heights of power, the business media quickly proclaimed thatthe reign of abrasive, intimidating leaders was over. However, it's premature to proclaim their extinction. Many great intimidators have done fine for a long time and continue to thrive. Their modus operandi runs counter to a lot of preconceptions about what it takes to be a good leader. They're rough, loud, and in your face. Their tactics include invading others' personal space, staging tantrums, keeping people guessing, and possessing an indisputable command of facts. But make no mistake--great intimidators are not your typical bullies. They're driven by vision, not by sheer ego or malice. Beneath their tough exteriors and sharp edges are some genuine, deep insights into human motivation and organizational behavior. Indeed, these leaders possess political intelligence, which can make the difference between paralysis and successful--if sometimes wrenching--organizational change. Like socially intelligent leaders, politically intelligent leaders are adept at sizing up others, but they notice different things. Those with social intelligence assess people's strengths and figure out how to leverage them; those with political intelligence exploit people's weaknesses and insecurities. Despite all the obvious drawbacks of working under them, great intimidators often attract the best and brightest. And their appeal goes beyond their ability to inspire high performance. Many accomplished professionals who gravitate toward these leaders want to cultivate a little "inner intimidator" of their own. In the author's research, quite a few individuals reported having positive relationships with intimidating leaders. In fact, some described these relationships as profoundly educational and even transformational. So before we throw out all the great intimidators, the author argues, we should stop to consider what we would lose.     

Discovering your authentic leadership

The ongoing problems in business leadership over the past five years have underscored the need for a new kind of leader in the twenty-first century: the authentic leader. Author Bill George, a Harvard Business School professor and the former chairman and CEO of Medtronic, and his colleagues, conducted the largest leadership development study ever undertaken. They interviewed 125 business leaders from different racial, religious, national, and socioeconomic backgrounds to understand how leaders become and remain authentic. Their interviews showed that you do not have to be born with any particular characteristics or traits to lead. You also do not have to be at the top of your organization. Anyone can learn to be an authentic leader. The journey begins with leaders understanding their life stories. Authentic leaders frame their stories in ways that allow them to see themselves not as passive observers but as individuals who learn from their experiences. These leaders make time to examine their experiences and to reflect on them, and in doing so they grow as individuals and as leaders. Authentic leaders also work hard at developing self-awareness through persistent and often courageous self-exploration. Denial can be the greatest hurdle that leaders face in becoming self-aware, but authentic leaders ask for, and listen to, honest feedback. They also use formal and informal support networks to help them stay grounded and lead integrated lives. The authors argue that achieving business results over a sustained period of time is the ultimate mark of authentic leadership. It may be possible to drive short-term outcomes without being authentic, but authentic leadership is the only way to create long-term results.     

Competitive Pricing in Markets with Different Overhead Costs: Concealment or Leakage of Cost Information?

This paper experimentally investigates how leaders and followers in a duopoly set prices for two product markets that have different overhead costs. In a fully crossed two-by-two design, we manipulate the participants' private cost report quality as either low or high, representing the extent to which these reports reveal that product markets have different overhead costs. We show that when only the leader is given a high-quality cost report, private cost information of higher quality is better incorporated into market prices (that are observable to participants). Both the leader and follower improve in profits and their prices better reflect the differences in overhead costs because the follower infers information from the leader's prices (information leakage). In contrast, when only the follower receives a high-quality cost report, the leader's profits and prices do not improve. This occurs because the follower conceals cost information when the leader has a low-quality cost report.     

Leadership run amok. The destructive potential of overachievers

The desire to achieve is a major source of strength in business, and it is on the rise. The authors' consulting firm has seen a steady increase in the extent to which achievement motivates managers. There's a dark side to the trend, however. By relentlessly focusing on tasks and goals, an executive or company can damage performance. Overachievers tend to command and coerce, stifling subordinates. Psychologist David McClelland identified three drivers of behavior: achievement, meeting a standard of excellence; affiliation, maintaining close relationships; and power, having an impact on others. He said the power motive comes in two forms: personalized, in which the leader draws strength from controlling people, and socialized, where the leader derives strength from empowering people. Studies show that great charismatic leaders are highly motivated by socialized power. To look at how motives and leadership style affect a group's work climate and performance, the authors studied 21 senior managers at IBM.The leaders who created high-performing and energizing climates got more lasting results by using a broad range of styles, choosing different ones for different circumstances. Rather than order people around, they provided vision, sought buy-in and commitment, and coached. If you're an overachiever seeking to broaden your range, you can study your actions and ask your team, peers, and manager to give you honest feedback. You can adopt specific new behaviors, such as engaging your team in a discussion of how to achieve goals, rather than issuing a set of directives. The company as a whole can play a part, too: Organizations must learn when to draw on the achievement drive and when to rein it in.     

The Empire strikes back. Counterrevolutionary strategies for industry leaders

Industry leaders frequently worry that their companies will fall victim to some revolutionary business model or disruptive technology. But new research shows that it's strategically better for incumbents to counter a revolution than to ignore or fully embrace it. Successful incumbents rely on one or more of five approaches to restrain, modify, or, if necessary, neutralize a revolutionary threat. A company that perceives a revolution in its earliest stages can use containment strategies. By throwing up roadblocks--raising switching costs, perhaps, or launching discrediting PR efforts--an incumbent can often limit the degree to which customers and competitors accept a nascent insurgency. And, sometimes, revolutions die there. If not, early containment buys a company some time to shape the revolution so that it complements, rather than supersedes, the incumbent's strengths. And even if shaping efforts fail, they can give an industry leader more time to work out how to absorb the threat by bringing the new competencies or technologies inside the firm in such a way that they don't destroy its existing strengths and capabilities. When revolutions have progressed too far to slow them down, incumbents must take a more aggressive tack. Neutralizing strategies meet a revolution head-on and terminate it--by, say, temporarily giving away the benefits offered by the challenger for free. Annulment strategies allow the market leader to leapfrog over or sidestep the threat. These five strategic approaches need not be used in isolation, as a detailed case study of the way Anheuser-Busch countered the craft-beer revolution dramatically demonstrates. Sensible industry leaders do not lead revolutions; they know they may not survive the attempt. Instead, they prefer to lead counterrevolutions.     

Leading clever people

In an economy driven by ideas and intellectual know-how, top executives recognize the importance of employing smart, highly creative people. But if clever people have one defining characteristic, it's that they do not want to be led. So what is a leader to do? The authors conducted more than 100 interviews with leaders and their clever people at major organizations such as PricewaterhouseCoopers, Cisco Systems, Novartis, the BBC, and Roche. What they learned is that the psychological relationships effective leaders have with their clever people are very different from the ones they have with traditional followers. Those relationships can be shaped by seven characteristics that clever people share: They know their worth--and they know you have to employ them if you want their tacit skills. They are organizationally savvy and will seek the company context in which their interests are most generously funded. They ignore corporate hierarchy; although intellectual status is important to them, you can't lure them with promotions. They expect instant access to top management, and if they don't get it, they may think the organization doesn't take their work seriously. They are plugged into highly developed knowledge networks, which both increases their value and makes them more of a flight risk. They have a low boredom threshold, so you have to keep them challenged and committed. They won't thank you--even when you're leading them well. The trick is to act like a benevolent guardian: to grant them the respect and recognition they demand, protect them from organizational rules and politics, and give them room to pursue private efforts and even to fail. The payoff will be a flourishing crop of creative minds that will enrich your whole organization.     

Leadership in literature

Business students nowadays are not, for the most part, poets. A growing proportion come to business school with a background in investment banking or management consulting and an undergraduate business major, rather than a degree in the arts and sciences. MBA students are already very familiar with business. A number of scholars and businesspeople have begun to question the scientific model that dominates business research and teaching. Formalized management tools work well enough if you're studying techniques for financial valuation, but less so when you're studying leadership and organizational behavior. Some argue that students could learn a lot more about these subjects if they took a course in literature. Examples from fiction can be as instructive as any business textbook. HBR senior editor Diane Coutu recently met with Joseph Badaracco, Jr., for a wide-ranging discussion of what leaders can learn from literature. For the past decade, Badaracco, the John Shad Professor of Business Ethics at Harvard Business School, has used classical literature to provide well-rounded, complex pictures of leaders in all walks of life-particularly leaders whose psychological and emotional challenges parallel those of senior executives. Fiction provides some of the most powerful and engaging case studies ever written. Unlike contemporary management literature, which is relentlessly upbeat, classical literature is unsparingly realist. Leaders often struggle and sometimes fail-and the stakes are high. When business leaders read about the conflicts of literary characters, they can better understand their own circumstances. We pay far too little attention to the inner lives of leaders. Business school courses seem to suggest that you can treat executives like lab animals and control their behavior through their environment. But behaviorism is not enough. Literature suggests that leaders should learn more about themselves if they want to succeed.     

The dangers of feeling like a fake

In many walks of life-and business is no exception-there are high achievers who believe that they are complete fakes. To the outside observer, these individuals appear to be remarkably accomplished; often they are extremely successful leaders with staggering lists of achievements. These neurotic impostors--as psychologists call them--are not guilty of false humility. The sense of being a fraud is the flip side of giftedness and causes a great many talented, hardworking, and capable leaders to believe that they don't deserve their success. "Bluffing" their way through life (as they see it), they are haunted by the constant fear of exposure. With every success, they think, "I was lucky this time, fooling everyone, but will my luck hold? When will people discover that I'm not up to the job?" In his career as a management professor, consultant, leadership coach, and psychoanalyst, Manfred F.R. Kets de Vries has found neurotic impostors at all levels of organizations. In this article, he explores the subject of neurotic imposture and outlines its classic symptoms: fear of failure, fear of success, perfectionism, procrastination, and workaholism. He then describes how perfectionist overachievers can damage their careers, their colleagues' morale, and the bottom line by allowing anxiety to trigger self-handicapping behavior and cripple the very organizations they're trying so hard to please. Finally, Kets de Vries offers advice on how to limit the incidence of neurotic imposture and mitigate its damage through discreet vigilance, appropriate intervention, and constructive support.     

Conquering a culture of indecision

The single greatest cause of corporate underperformance is the failure to execute. Author Ram Charan, drawing on a quarter century of observing organizational behavior, perceives that such failures of execution share a family resemblance: a misfire in the personal interactions that are supposed to produce results. Faulty interactions rarely occur in isolation, Charan says. Far more often, they're typical of the way large and small decisions are made or not made throughout the organization. The inability to take decisive action is rooted in a company's culture. But, Charan notes, leaders create a culture of indecisiveness, and leaders can break it. Breaking it requires them to take three actions. First, they must engender intellectual honesty in the connections between people. Second, they must see to it that the organization's "social operating mechanisms"--the meetings, reviews, and other situations through which people in the corporation do business--have honest dialogue at their cores. And third, leaders must ensure that feedback and follow-through are used to reward high achievers, coach those who are struggling, and discourage those whose behaviors are blocking the organization's progress. By taking these three approaches and using every encounter as an opportunity to model open and honest dialogue, a leader can set the tone for an organization, moving it from paralysis to action.     

Musings on management. Ten ideas designed to rile everyone who cares about management

Henry Mintzberg, a professor of management at McGill University in Canada and at INSEAD in France, takes aim at the hype surrounding management fads and gurus and dares to suggest that the emperor has no clothes. In order to rile all who care about management and get them thinking creatively, he presents ten contrarian observations on such topics as the meanness of leanness, the folly of CEOs who fancy themselves strategists, the disempowering that so-called empowerment creates, the myopia of purely financial measures, and the inadequacy of M.B.A. programs. Mintzberg maintains, for example, that it is time to delayer the delayerers. He argues that delayering has created more problems than it has solved be cause it is, in essence, a process by which people who barely know what's going on get rid of those who do--a process ensuring that the real database of the organization, the key to what was its future, lines up at the unemployment office. Too many managers, he says, dream of becoming the next turnaround doctor. They fail to understand that great organizations, once created, don't need great leaders: if a company can't function on its own, a hero won't help. A leader who draws out the knowledge embedded in all parts of an organization is a leader who can help a company function alone--without heroes. Such leaders often practice what Mintzberg calls the craft style of management (as opposed to the professional style or the boss style). It is about inspiring, not empowering. It is based on mutual respect rooted in common experience and offers hope for improving what is now wrong with management.     

How successful leaders think

In search of lessons to apply in our own careers, we often try to emulate what effective leaders do. Roger Martin says this focus is misplaced, because moves that work in one context may make little sense in another. A more productive, though more difficult, approach is to look at how such leaders think. After extensive interviews with more than 50 of them, the author discovered that most are integrative thinkers -that is, they can hold in their heads two opposing ideas at once and then come up with a new idea that contains elements of each but is superior to both. Martin argues that this process of consideration and synthesis (rather than superior strategy or faultless execution) is the hallmark of exceptional businesses and the people who run them. To support his point, he examines how integrative thinkers approach the four stages of decision making to craft superior solutions. First, when determining which features of a problem are salient, they go beyond those that are obviously relevant. Second, they consider multidirectional and nonlinear relationships, not just linear ones. Third, they see the whole problem and how the parts fit together. Fourth, they creatively resolve the tensions between opposing ideas and generate new alternatives. According to the author, integrative thinking is an ability everyone can hone. He points to several examples of business leaders who have done so, such as Bob Young, cofounder and former CEO of Red Hat, the dominant distributor of Linux opensource software. Young recognized from the beginning that he didn't have to choose between the two prevailing software business models. Inspired by both, he forged an innovative third way, creating a service offering for corporate customers that placed Red Hat on a path to tremendous success.     

Firing back: how great leaders rebound after career disasters

Among the tests of a leader, few are more challenging-and more painful-than recovering from a career catastrophe. Most fallen leaders, in fact, don't recover. Still, two decades of consulting experience, scholarly research, and their own personal experiences have convinced the authors that leaders can triumph over tragedy--if they do so deliberately. Great business leaders have much in common with the great heroes of universal myth, and they can learn to overcome profound setbacks by thinking in heroic terms. First, they must decide whether or not to fight back. Either way, they must recruit others into their battle. They must then take steps to recover their heroic status, in the process proving, both to others and to themselves, that they have the mettle necessary to recover their heroic mission. Bernie Marcus exemplifies this process. Devastated after Sandy Sigoloff ired him from Handy Dan, Marcus decided to forgo the distraction of litigation and instead make the marketplace his batttleground. Drawing from his network of carefully nurtured relationships with both close and more distant acquaintances, Marcus was able to get funding for a new venture. He proved that he had the mettle, and recovered his heroic status, by building Home Depot, whose entrepreneurial spirit embodied his heroic mission. As Bank One's Jamie Dimon, J.Crew's Mickey Drexler, and even Jimmy Carter, Martha Stewart, and Michael Milken have shown, stunning comebacks are possible in all industries and walks of life. Whatever the cause of your predicament, it makes sense to get your story out. The alternative is likely to be long-lasting unemployment. If the facts of your dismissal cannot be made public because they are damning, then show authentic remorse.The public is often enormously forgiving when it sees genuine contrition and atonement.     

Worse than enemies. The CEO's destructive confidant

The CEO is often the most isolated and protected employee in the organization. Few leaders, even veteran CEOs, can do the job without talking to someone about their experiences, which is why most develop a close relationship with a trusted colleague, a confidant to whom they can tell their thoughts and fears. In his work with leaders, the author has found that many CEO-confidant relationships function very well. The confidants keep their leaders' best interests at heart. They derive their gratification vicariously, through the help they provide rather than through any personal gain, and they are usually quite aware that a person in their position can potentially abuse access to the CEO's innermost secrets. Unfortunately, almost as many confidants will end up hurting, undermining, or otherwise exploiting CEOs when the executives are at their most vulnerable. These confidants rarely make the headlines, but behind the scenes they do enormous damage to the CEO and to the organization as a whole. What's more, the leader is often the last one to know when or how the confidant relationship became toxic. The author has identified three types of destructive confidants. The reflector mirrors the CEO, constantly reassuring him that he is the "fairest CEO of them all." The insulator buffers the CEO from the organization, preventing critical information from getting in or out. And the usurper cunningly ingratiates himself with the CEO in a desperate bid for power. This article explores how the CEO-confidant relationship plays out with each type of adviser and suggests ways CEOs can avoid these destructive relationships.