Guest Post by Ian Price
The recent temporary departure of Antonio Horta-Osorio from his role at Lloyds Banking Group was unusual in the candid use of the ‘S’-word – “stress” – in the bank’s announcement. For any number of reasons, leaders, their boards and investors are keen to avoid the word as part of the narrative in a leader’s exit. However, there have, in the last year or so, been a number of sudden, unplanned chief executive resignations that the press has attributed – at least in part – to stress. These include Masataka Shimizu of Tokyo Electric Power, Jeff Kindler of Pfizer (more of him later), Mark Tincknell of Connaught and Andy Hornby at Boots.
It would be all too easy to succumb to the temptation to talk dramatically of a “stress epidemic” among our CEOs but is there something about the way in which we select, appoint and reward our leaders that makes stress or fatigue more likely? Perhaps it is because the current vogue for high-energy, dynamic leaders – a vogue that flies in the face of the science – is actively driving up fatigue and poor performance as well as Information Overload.
The press never seems to predict sudden CEO exits; instead, its profiles of in situ leaders always tend towards the hagiographic. It was no different with Horta-Osorio although even in The Sunday Telegraph interview with him in July 2011 there were signals that his leadership style was going to be difficult to sustain. In what should have been a red flag that the man was taking too much on his own shoulders, the profile was titled: “Lloyds chief Antonio Horta-Osorio is working 24-7 to turn around the bank – and the UK economy.”
Horta-Osorio himself seemed more concerned with the impact on his family than his own resilience. “My family is complaining they haven’t seen me very much these last few weeks. I have to make it up to them. It’s been a very tough few weeks.” The article does not question the CEO’s style nor reflect on its sustainability. However, less than four months later and following Horta-Osorio’s departure, further details have emerged in the press of “obsession with detail” and “micro-managing matters which most other chief executives would let aides deal with”. One of the outputs of this style would undoubtedly have taken the form of information overload for his management team.
In terms of leadership style, what we have witnessed in Horta-Osorio is, in Daniel Goleman’s language, the “Pacesetter” – the leader that “sets extremely high performance standards and exemplifies them himself. He is obsessive about doing things better and faster, and he asks the same of everyone around him”. Of six leadership styles which one might flex according to context, the Pacesetter is the one that seems to be most in vogue among journalists, selection committees and investors. This is because it offers a reassuring sense of value for money, particularly if a high remuneration package was needed to draw the leader to the role in the first place.
The example of Jeff Kindler at Pfizer offers a number of parallels with that of Horta-Osorio. When Kindler’s departure was announced in December 2010, he had the following text inserted into the release at his own insistence: “The combination of meeting the requirements of our many shareholders around the world and the 24/7 nature of my responsibilities has made this period extremely demanding on me personally.” Like Horta-Osorio, Kindler took the principle of leading from the front to extremes as is evident from an extensive analysis by Fortune magazine of his style.
Kindler, a one-man IO factory, held conference calls on weekends and reportedly bombarded his deputies with voicemails and emails at all hours of the day and night. Ultimately, the style contributed to his burning out but also, crucially, lost him the support of his key executives and directors who, as at Lloyds, resented Kindler’s micromanagement. The classic apologia for the style of Kindler and other Pacesetters can be found in a revealing quote that Fortune acquired from a former colleague of his when he was at McDonalds where he was known to work longer hours than anyone else. “He’s very demanding,” said the former colleague, “but he demands less from others than he would from himself.” It is as if the words were lifted from Goleman’s definition of Pacesetting.
When one reads the anecdotes that emerge after the event from companies such as Lloyds and Pfizer, it is possible to see how a frenetic, micro-managing style can inhibit employees’ clarity about mission and values; if, as Kindler did, the CEO is prone to fire out aggressive emails and leave voicemails for employees late at night expressing dissatisfaction, that behaviour and its IO consequences are likely to recur and cascade down the organisation as the leader’s impact as a role model takes effect.
It seems as if the most corrosive elements of the Pacesetting style – the emails, the long hours, the working across weekends and holidays, the punishing travel schedule – are now hard-wired into the leadership role in a way that simply wasn’t the case thirty years or so ago. I believe there are three causal factors for this. The first of these is the IO-enabling technology that means that the barriers to Pacesetting work (for example, secretaries that have gone home, executives on the move and out of contact, the difficulty of global travel) have been removed. A global air industry and the advances in communications technology (conference calls, email and mobile devices) are such that the twenty-first century leader can work continuously. The second factor is the death of hierarchy – as we have stripped organisations of the traditional indicators of seniority (private dining facilities, corner offices, company drivers) so we have conflated activity with status – the busier we are, the more important we must be. The third factor is the distortion of the Protestant work ethic into something more aggressive which assumes that a punishing work schedule is a pre-requisite for leadership success.
Indeed, it now appears to be widely accepted that corporate leadership in the twenty-first century requires a level of sustained personal commitment that means one can no longer assume that the traditional non-work dimensions of life will continue to exist. CEOs on the threshold of acceding to a leadership position use language that suggests some sort of Faustian pact. In The Secrets of CEOs by Steve Tappin and Andrew Cave, more than half of the CEOs interviewed said that they have little time for family or personal interests and passions, “such are the demands of being the boss.”
In fact, what the twenty-first century organisation needs is leadership that is more nuanced and reflective of our changed environment, something also well-established by the science. Manfred Kets de Vries built his Global Executive Leadership Inventory (GELI) on the back of 360 degree feedback of several hundred CEOs. What emerged was an inventory of twelve dimensions of leadership. Many of these are precisely the leadership qualities that suffer in the frenetic, “too-busy” world of the Pacesetting leader: Work-Life Balance, Resilience to Stress, Empowering, Envsioning, Team-Building, Emotional Intelligence, Energizing, Rewarding/Feedback. What emerges clearly from the portraits of burnt-out leaders such as Kindler and Horta-Osorio is punishing personal work schedule combined with a reluctance to delegate.
So, far from crowding out time spent with family and in leisure pursuits, the leadership role should build in a hinterland and recovery time to make the role sustainable and allow time for critical thinking. While there is a time and place for rolling up one’s sleeves and leading from the front, the leader in the large organisation of the twenty-first century will achieve success in no small part down to his or her ability to delegate effectively and leverage the organisation by painting a vision that others would like to follow. However, my experience of working with boards, selection professionals and recruiters is that these qualities are rarely sought at all let alone tested. Instead, we appear to seek dynamic, high-energy leaders who are subsequently profiled admiringly in the press for exactly the qualities that may contribute to their subsequent burn-out. My guess is that, in a tough economic climate, we will see more Pacesetters drop out of the race.
CEO turned business psychologist, Ian Price is the author of The Activity Illusion: Why we Live to Work in the 21st Century and How to Live Instead. Through his consulting firm Grimsdyke Consulting, he helps organisations and leaders achieve more by doing less. He is a member of the British Psychological Society’s Work Life Balance Working Group and of the Association of Business Psychologists.