Ambidextrous leadership

CEOs should manage both the tangible and the intangible

By Kim Jae-kyoung

Everyone wants to be a leader but only a few climb to the top. Many people believe that true leaders are born, not made, and they don’t even give a try to become a leader. However, a life-time HR consultant hints that it is the other way around and that everyone can be a leader if he or she has strategies. Mark V. Mactas, president and chief operating officer of Towers Watson, gave us a very simple but clear answer. “If you have a good idea and people to execute it, then you can be a leader.”

CEO Mactas recently visited Seoul and the BusinessFocus team met with the leadership expert at the global consulting firm’s Seoul office on March 7 to listen to his view on how to become a good leader.

Q:

Businesses are facing a myriad of challenges following the global financial crisis. In these turbulent times, leadership has become more important than ever. How do you define leadership? How do you think leadership is different now than it was in the past?

A:

It’s multi-dimensional. Historically, leaders always had to be stewards of the business that they have been in. They had to set a tone for the values of the organization, they had to articulate a strategy for the growth in the path of the business, and they had to find a way for the people to follow them so that they could execute strategies. I think the global financial crisis has put a spotlight on something that has been there but maybe overlooked. That was risk management. So I think what this financial crisis has done is primarily to have leaders focus more on risk managment while pursuing the others that I talked about.

Another dimension is that leadership is not simply about tangible things — financial resources, new products and new services. It certainly concerns those things but it’s about intangible things as well. It’s about values, it’s about culture, it’s about people, and it’s about setting a tone. Not that those things were absent before, but I think the right balance is important. We call it ambidextrous leadership. We have to pay attention to the tangible, and we also have to pay attention to the intangible. We have to pay attention to the short-run, but we also must pay attention to the long-run. So I think tangible and intangible, short-run and long-run, those are the kinds of things that leaders are charged with addressing.

Do you think leaders can be made or born? And how do you make a distinction between good leaders and bad leaders?

I think some leaders are born. I think more leaders are made. I think there is a picture of the right leader being a charismatic, very dynamic personality leading organizations. It might have a place in industries and companies at a point in time. I don’t think most leaders are like that. And I think most leaders can be made. Leadership is different than management. Some say management is power by position and leadership is power by influence. I think viewing leadership as power by influence means that a leader has to have an idea that has merit. And then the leader must be able to get the people to follow him or her.

So a person just having a good idea, if they cannot get somebody to follow, they can’t be a leader. If somebody follows you and doesn’t know which direction, you are not a leader. And I think those are the two essential ingredients. And there are different ways to do that. Some do it through charismatic leadership, and some don’t create a spotlight, but people are somehow attracted to and follow. And the direction that the person chooses happens to be the right one. I would say the same company might have two kinds of leaders, being more or less effective in different kinds of time. Some kind of leader that might be most effective when the economy is going very well might be different from a leader that you need or want when the economy isn’t so good. I think it is the case that leaders are definitely made, not just born.

Look outside for efficiency

Many business leaders are desperate to maximize the efficiency of their organizations. What do you think is the best way to implement cost-saving step?

I think that’s the continuous challenge that companies face. One of the things to do is to do self-examination and involve others in your organization. I think you can look at your competitors, see how they do things differently with the same. It’s important to look outside the natural sphere of references. Sometimes the best ideas for how to make your own business more efficient come from other industries. And challenge conventional thinking. So in a capital-intensive industry, they will look at ways to cut capital cost in a people-intensive industry where companies will look at ways to economize on people cost.

Employee engagement is crucial

According to a recent survey by Towers Watson, Korean employees are much less engaged than those in other countries. So what would be the solution?

We do find a co-relation between the level of engagement and the level of financial performance of companies. If you consider it during this economic crisis that we have been through, it is really important for leaders to have a number of things at work in engaging people. Especially during unsettled times, employees must know the business’ purpose, object and visions. They need to know how they fit in. I think leaders need to be even more present during an economic crisis in every respect than when we are not in an economic crisis. To communicate, to involve in changing management activities and to bring people along becomes very important.

And sometimes there is a tendency in a crisis when you don’t have all the answers. Sometimes leaders cannot communicate because they don’t have the answers. That’s probably the most important time. Because employees feel uncertain, they might have anxiety about their jobs and they might have a broader anxiety about the economy. In this circumstance, participating with employees in the journey of where we are headed is a really important thing. At the end of the day, employees want a sense of purpose, sense of belonging and they want to be involved in career development opportunities and all sorts of things. So these are all important elements of getting employees engaged.

Some Korean companies, such as LG Electronics, have increased the number of foreign executives to internationalize their manpower. But in many cases, they failed due to cultural differences and internal resistance to change. What would be your advice to them?

Many companies are increasingly becoming more diverse in terms of the talent. When hiring different kinds of talent from outside, the organization first needs to be able to have an environment where such moves can glide. And then the selection process needs to be one that brings in the right kind of talent in order to have that executive succeed. I think it’s kind of an ongoing challenge that a lot of companies have. Some companies are very good at growing their talent and promoting people to executive positions, and others have a model of hiring more talent from the outside as they grow and expand. So those different models have different outcomes with the respective choices they make.

Global mobility has become an issue for Korean companies seeking to go abroad. So what would be your suggestions to deal with this issue?

Global mobility is important to companies looking to regionalize or globalize. It must be a part of a broader talent management strategy. It can play a part but it’s not the whole answer to how you execute your corporate objectives with your people. Global mobility is important for skills and for culture — in a company culture in which you want to establish in other geography. If it is not within the broader talent management strategy and if individuals that you choose are involved in your expansion abroad, you can still optimize how they contribute to your organization.

kjk@koreatimes.co.kr

BuisinessFocus intern Chung Min-uck contributed to this article