In an article written by Barbara Kellerman, PhD, if Harvard University, she boldly proclaims, Leadership, its a system not a person! In essences, Dr. Kellerman is proclaiming the future of leadership – the system of leadership. Unfortunately, we worship at the altar of personally driven leadership. My last Amazon search listed 197,000 books on leadership. Virtually everyone approaching leadership as an individual. Annually, we spend approximately $40 Billion on leadership development. Most of it, attempting to develop better individuals. Consequently there is little evidence of measurable organizational value. One reason, the training is disconnected from organizational mission, vision, culture, and systems.
What is a System of Leadership?
We understand biological systems. We know digital systems and organizations are cultures of connected systems. However, the last remaining frontier of organizational systems is the system of leadership. When intentionally designed, these systems generate sustainable long-term performance, higher employee engagement, and unparalleled customer value.
A leadership system is defined as the way key organizational resources interact so that they achieve a desirable and measurable purpose. This definition applies classical system thinking to the practice of organizational leadership. There are three parts to the system of leadership:
1) Key resources;
2) That interact in a specific way:
3) That they achieve a desired outcome or purpose.
Of the three parts, the purpose is the most important. Here is why:
Seattle’s Swedish Hospital Neurological Institute evolved from an organization focused on patient safety to revenue generation. They changed the surgeon’s compensation formula from one where surgeons shared revenues to a formula that compensated surgeons for production. This new formula resulted in higher surgical production. Surgical payments soared. Unfortunately, competition for surgical production replaced surgical collaboration. However, the system performed exactly the way it was designed.
The result was harm to patients and lapses in ethics. The CEO of Swedish Hospital resigned, and the Institute’s director lost his license to practice in the State of Washington. The parent organization’s CEO took out a full-page ad in the local newspaper apologizing to patients and staff.
What Has More Power, System or the Person?
Changing the purpose of a system is significant. Changing the purpose of a system from patient safety to revenue generation is seismic. Were the individual leaders of the Institute stupid or unqualified? Exactly the opposite. Each leader within the system was smart and extremely well qualified. However, as Deming said: I should estimate that in my experience most troubles and most possibilities for improvement add up to the proportions something like this: 94% belongs to the system (responsibility of management) 6% special events.
So was it is more important, the individual leader, or the system?