Thinking Paper #1

ESSENTIAL INGREDIENTS FOR ORGANIZATIONAL TRANSFORMATION

Are you a CEO, CFO, CIO, president, executive, board member, director, partner, manager, superintendent, educator, government official, politician, bureaucrat, pastor, counselor, trainer, consultant, or leader of a business or organization?

Are you starting, founding, creating, growing, merging, acquiring, diversifying, realigning, restructuring, reorganizing, outsourcing, downsizing, rightsizing, renewing, revitalizing, changing, or transforming your business or organization?

Are you hopeful, wishful, doubtful, concerned, uncertain, frustrated, worried, troubled, blocked, stymied, or cynical about the performance and effectiveness of your business or organization?

We believe that there are at least two essential ingredients in any effort to transform a business or organization-leadership and systems thinking.  While not secret, these ingredients are often, unfortunately, overlooked or missing.  John Gardner, former Secretary of State for Jimmy Carter, asserts in his book, On Leadership, that the relationship between a leader and her followers is a constant.  Raise the level of leadership and you raise the level of performance of the organization.  Peter Senge, Director of the MIT Center for Organizational Learning, contends in his book, The Fifth Discipline, that systems thinking is the key discipline of a learning organization.

While there are many definitions of leadership, we are particularly interested in a specific kind, what leadership scholars James MacGregor Burns and Bernard Bass call transformational leadership.  Burns defines leadership as "the reciprocal process of mobilizing, by persons with certain motives and values, various economic, political, and other resources, in a context of competition and conflict, in order to realize goals independently or mutually held by both leaders and followers."  He distinguishes two types of leadership—transactional and transformational, depending upon the nature of these goals. In transactional leadership, leaders and followers exchange goods, services, or other things in order to realize independent objectives. In transformational leadership, leaders shape, alter, or elevate the motives, goals, and values of followers.  In this case, leadership raises the follower's pursuits to a higher level.  Simply, transactional leadership is focused on means, transformational on ends.

Bass, in extending Burns’ work, contends that transformational leadership is performed when leaders:

·         Stimulate followers to view their work in new ways,

·         Generate awareness of the vision or mission of the organization,

·        Develop followers to higher levels of ability and potential, and

·         Motivate followers to look beyond their own interests toward those that will benefit the organization.

Bass argues that transformational leaders help followers achieve superior performance by employing one or more of what he calls the “Four I’s”: idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration.  We’ll address these further in a future THINKING PAPER™.

There are as many definitions of systems thinking as there are of leadership.  Systems thinking is a conceptual framework for thinking about the dynamic and detailed complexities of organizations.  An organization can be thought of as a system of interacting components, and system-based methods can be used to understand and improve organizational performance.

Alan Waring, in his book, Practical Systems Thinking, summarizes the characteristics of a system:

·         A system does something-there are processes and outputs.

·         Addition or removal of a component changes the system.

·         A component is affected by its inclusion in the system.

·         Components are perceived to be related in hierarchical structures.

·         There are means for control and communication that promote system survival.

·         The system has emergent properties, some of which are difficult to predict.

·         The system has a boundary.

·         Outside the boundary is a system environment that affects the system.

·        A system is owned by someone.

Transformational leadership and systems thinking are key competencies for leaders interested in organizational transformation.

REFERENCES

Bass, B.M. (1994).  Improving Organizational Effectiveness Through Transformational Leadership.  Newbury Park, CA: Sage Publications.

Burns, J.M. (1978).  Leadership.  New York: Harper & Row.

Gardner, J. (1990).  On Leadership.  New York: Free Press.

Senge, P.M. (1990). The Fifth Discipline: The Art and Practice of the Learning Organization.  New York: Doubleday.

Waring, A. (1996). Practical Systems Thinking.  London: International Thompson Business Press.