Building a Leadership Community of High Commitment and High Performance

If the leaders of the financial institutions implicated in the economic crisis had had the aspirations, the higher moral purpose, or the savvy to build resilient organisations capable of sustained advantage, could we have avoided the financial crisis? Harvard’s Michael Beer thinks so. Leaders of high commitment, high performance organisations (HCHP) make principled choices. He argues in High Commitment High Performance: How to Build A Resilient Organization for Sustained Advantage, “These choices begin with their definition of firm purpose—a desire to make a positive contribution to customers, employees, and society.” If a leader’s “primary goal is to acquire money and power, building an HCHP organisation will be beyond their reach.”

To build enduring HCHP organisations, leaders must stick to the firm’s why: purpose and guiding values, strategy, risk profile, and basic for motivating, organising, and managing people. “In times of crisis, when capital markets may demand expedient decisions that could take the firm off the HCHP path, commitment to principles enables CEOs to go against conventional wisdom in decisions about strategy, debt, growth rate, acquisitions, and layoffs.”

These circumstances often create conflicting demands between people and profits that leaders must learn to integrate. This does not call for heroic leaders—single-minded and single-handed leaders—but leaders who are willing to listen and engage others in a collective action learning process. In a crisis we often look for saviours, but instead, writes Ron Heifetz in Leadership Without Easy Answers, “we should be calling for leadership that will challenge us to face problems for which there are no simple, painless solutions.”

Heroic leadership isn’t about listening or collective learning. “Most important,” writes Beer, “heroic leadership fails to perform the central function of leadership—engaging employees authentically in a process of organisational learning and development from which they as leaders also learn.” Leading the creation of a HCHP organisation is “not about aligning the company with the leader’s ideas. It is about enabling leaders and their people to learn together about the problems they face and the actions they must take.”

Surviving and thriving in this crucible of conflicting demands is no easy task. It requires that leaders strengthen and develop their internal resources. They must learn to enter the fundamental state of leadership when faced with challenges—a state that demands that they dig deep into their values and purpose. That fundamental state of leadership requires leaders to move from comfort with activities to focus on results, from self-absorption to commitment to mission and higher purpose, from focus on self to focus on others, from being internally closed to being externally open, and from hiding the truth to embracing the truth.

In general, underperforming companies have not developed leaders throughout their organisations. Beer suggests that this is because “most managers had come up through their home function, business unit, or region, and never acquired the broader general management perspective needed to understand and manage cross-boundary activities….In many of the companies, ineffective senior teams did not spend time developing common values and perspective about what constituted good leadership.”

Again, the primary responsibility to learn to lead from where you are lies with you.

Building a Leadership Community of High Commitment and High Performance