Prelims
Progressive Leadership: Challenging the Theory of the Firm in the 21st Century
ISBN: 978-1-83867-568-4, eISBN: 978-1-83867-567-7
Publication date: 21 March 2022
Citation
Park, G. (2022), "Prelims", Progressive Leadership: Challenging the Theory of the Firm in the 21st Century, Emerald Publishing Limited, Leeds, pp. i-xxii. https://doi.org/10.1108/978-1-83867-567-720221012
Publisher
:Emerald Publishing Limited
Copyright © 2022 Emerald Publishing Limited
Half Title Page
Progressive Leadership
Title Page
Progressive Leadership: Challenging the Theory of the Firm in the 21st Century
BY
GREG PARK
United Kingdom – North America – Japan – India – Malaysia – China
Copyright Page
Emerald Publishing Limited
Howard House, Wagon Lane, Bingley BD16 1WA, UK
First edition 2022
Copyright © 2022 Emerald Publishing Limited
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British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
ISBN: 978-1-83867-568-4 (Print)
ISBN: 978-1-83867-567-7 (Online)
ISBN: 978-1-83867-569-1 (Epub)
Contents
List of Figures | xi |
List of Tables | xiii |
List of Boxes | xv |
Preface | xix |
Acknowledgements | xxi |
Introduction | 1 |
What’s this Book about? | 1 |
What’s the Problem? | 1 |
Dominant Logic ‘Creep’ | 2 |
What Do We Mean by the Term ‘Progressive’? | 4 |
Urgent and Major Surgery to the Body Corporate | 6 |
Replace the Hollow Men | 8 |
Dare to Be a Leader | 10 |
First, They Ignore You | 11 |
Think Driverless Car | 13 |
The Road Ahead | 15 |
Part I: Hard Truths and Tough Solutions to Make Firm Leadership Relevant in the Twenty-first Century Business Context | |
Chapter 1: Resist Malignant Normality | 19 |
The Ides of March are Upon Us | 19 |
The Irrelevance of Leadership | 19 |
Acknowledge Malignant Normality | 22 |
Time for a Leadership Reality Check | 27 |
The Times They are A-changing | 30 |
We are the Hollow Men | 32 |
The Licence to Lead Must Be Earned Once More | 34 |
Let’s Get with the Programme | 37 |
Exercises | 40 |
Chapter 2: Re-imagining the Priorities of Capitalism in Order to Re-invent Leadership | 41 |
Time to Question the Fundamental Drivers Which Direct Leadership Priorities | 41 |
Capitalism and Leadership Re-modelled for the Twenty-first Century | 43 |
Leaders Must Acknowledge that They Now Require More than a Spanner | 49 |
Open the Mind, Loosen Control and Unleash Creativity and Collaboration | 52 |
Optimal Decision-Making Requires Accessing the Totality of Firm Knowledge and Intellect | 55 |
Exercises | 62 |
Part II: Let’s Lay the Foundations for Effective Firm Leadership | |
Chapter 3: A Theory of the Firm for Today and Tomorrow | 65 |
Time to Address Issues of Governance | 65 |
Leaders Must Address the Disparity Between Dominant Principles and Operational Reality | 67 |
Unpicking the Theory of the Firm – Who is Really Running the Show? | 70 |
The Law and the Theory of the Firm | 76 |
Towards a More Relevant Theory of the Firm | 79 |
The New Firm Dynamic | 82 |
Exercises | 86 |
Chapter 4: Let’s Think More about the Psychology of Leadership | 87 |
Fundamental Leadership Issues are Cross-Disciplinary and Endemic | 87 |
The Absurdity, Glory and Complexity of ‘Real’ Leadership | 88 |
Get with the Programme | 92 |
‘Utility’ and the Prospect Theory | 95 |
Should I Care about What People are Really Thinking? | 101 |
Psychological Drivers and Effective Operational Leadership | 107 |
Experts are Human Too | 107 |
Identity as a Driver of Operational Effectiveness | 108 |
Curiosity | 110 |
Disadvantageous Inequality | 111 |
Irrational and Visceral Behaviour | 112 |
In a Nutshell | 114 |
Exercises | 116 |
Chapter 5 Get a Feel for the Dynamic of the Progressive Leadership Psychology | 117 |
The Creation of a ‘Blended Value Proposition’ | 117 |
Accept the Changing Firm and Leadership Dynamic | 119 |
Let’s Drill Down to the Substrate | 119 |
Regain Leadership Legitimacy | 120 |
True leaders of today and tomorrow are essentially Sense-makers | 121 |
Effective Sense-makers Visualise impact Down to the ‘floor’ | 123 |
Take the oath and address the failure to thrive | 125 |
Address Operational Issues which are Recognised as a Progressive Statement | 128 |
Progressive leadership means less A--holes | 129 |
Be Prepared to Resolve ‘Wicked’ Problems through Enhanced Psychological Capabilities | 132 |
Leaders must be willing to lose to succeed | 134 |
Listen to the voices | 138 |
Progressive Leadership Can/Must Also Germinate at the Apex of the Firm | 141 |
A Multi-disciplinary, Integral Leadership Logic | 145 |
Exercises | 147 |
Part III: No Need to Re-invent the Wheel: Profiles of Progressive Individuals and Firms | |
Chapter 6: Insights into Progressive Leaders’ Perspectives and Priorities | 151 |
What’s the Secret of Firm Longevity? – Progressive is Not New | 151 |
Progressive Leadership is about the Genes, Experiences and Reflections of the Individual | 154 |
Leaders Who Exhibit a Progressive and Psychologically Insightful Leadership Logic | 156 |
Don’t Scare the Horses: Think Progressively but Deliver on the Numbers that Still Matter | 172 |
Chapter 7: No Need to Re-invent the Wheel: Progressive Firm Profiles | 175 |
Let’s Re-construct the Pyramid | 175 |
Change the Record | 177 |
Progressive Leadership Principles and Priorities which Underpin the Industrial Foundation | 181 |
Firm Profile 1: Cordant Group – Multi-Sector | 185 |
Effective Progressive Leadership: Enlightenment Allied to Contextual Pragmatism | 185 |
The Application of a Progressive Leadership Logic | 185 |
Reality Bites – Fast | 189 |
Firm Profile 2: Danfoss A/S – Engineering Solutions | 191 |
Pencil Profile | 191 |
The Longer View: Courage and Sustainability for Optimal Performance | 191 |
Ownership, Control and Governance | 195 |
The Bitten & Mads Clausen Foundation | 197 |
Firm Profile 3: Novo Nordisk A/S – Pharmaceuticals & Health Care | 200 |
Pencil Profile | 200 |
History and Founder Motivations | 200 |
The Novo Nordisk Way – The Essentials | 201 |
Share and Ownership Structure – An Holistic and Integral Perspective | 204 |
Firm Profile 4: Bosch GmbH – Global Conglomerate: Leading Supplier of Technology and Technological Services | 209 |
Pencil Profile | 209 |
‘Progressive’ Is Not Related to Time, but Rather to Mindset | 210 |
Robert Bosch Defines Long-Term Firm Values, Priorities and Culture | 211 |
Ownership, Priorities and Separation of Power | 213 |
Closing Comments | 217 |
Part IV: I Am Spartacus!! Am I Spartacus? Operational Implementation | |
Chapter 8: Think Like a Progressive Leader | 221 |
In or Out? Recognising the Requirement for a Personal Metanoia | 221 |
Stage One in the Personal Metanoia: Insight into the Dynamic of the Progressive Leadership Paradigm | 222 |
Stage Two in the Personal Metanoia: Create Synergy Through Ambition Allied to Realism | 226 |
Stage Three in the Personal Metanoia: Imagine You are Directing a Play | 228 |
Stage Four in the Personal Metanoia: Where Does Everyone Stand? | 232 |
Ready to Jump in? | 237 |
Chapter 9: Act Like a Progressive Leader | 239 |
Step 1: Enthusiasm Without Appropriate Knowledge and Insight Equals Failure | 239 |
Step 2: Remember Gandhi – This is a Marathon, Not a Sprint | 241 |
Step 3: Anticipate, Prepare for and Clearly Communicate Firm and Personal Implications | 243 |
Step 4: Create a Structured, ‘Rolling’ Consultative and Collaborative Process | 246 |
Step 5: Take a ‘Psychological’ Approach to Interactions | 250 |
Step 6: How to Convince Those ‘Upstairs’ | 253 |
Step 7: Detailed and Phased Operational ‘Infiltration’ within the Firm of the Progressive Leadership Logic | 258 |
Step 8: Apply Responsible and Relationally Intelligent Perspectives During Transition | 264 |
Concluding Remarks | 266 |
References | 269 |
Index | 281 |
List of Figures
Figure 1.1. | Progressive Leadership – Unlearn the Leadership Logic | 39 |
Figure 2.1. | Progressive Leadership ‘Grand Challenges’ | 60 |
Figure 2.2. | Re-Imagining Capitalism to Re-Invent Leadership | 61 |
Figure 3.1. | Key Influences on Corporate Governance and Ultimately Operational Leadership | 73 |
Figure 3.2. | Parameters for Calculating the Level of Individual Compensation | 83 |
Figure 3.3. | A Theory of the Firm for Today and Tomorrow | 85 |
Figure 4.1. | Let’s Think About the Psychology of Leadership | 115 |
Figure 5.1. | The Foundations of the Twenty-First Century Firm Covenant | 121 |
Figure 5.2. | Impact of Low Leadership Self-Concept on Pro-Active Employee Contribution | 140 |
Figure 5.3. | Key Steps in Getting with the Progressive Programme | 146 |
Figure 7.1. | Prevailing Hierarchy and Priorities of the ‘Traditional’ Theory of the Firm | 177 |
Figure 7.2. | Progressive Structure and Priorities of the ‘Progressive’ Theory of the Firm | 177 |
Figure 7.3. | Cordant Group Companies | 186 |
Figure 7.4. | Megatrends – Danfoss Business Model | 193 |
Figure 7.5. | Danfoss Foundations – Objectives and Areas of Charitable and Social Support | 198 |
Figure 7.6. | Novo Nordisk – Sales by Therapeutic Area | 201 |
Figure 7.7. | Novo Nordisk Share and Ownership Structure | 205 |
Figure 7.8. | Bosch Group Business Sectors | 210 |
Figure 7.9. | Bosch Ownership, Decision-Making and Management Structure | 214 |
Figure 7.10. | Robert Bosch Stiftung – Areas of Support | 216 |
Figure 8.1. | The Network Required to Direct and Support Optimal Leadership Effectiveness | 223 |
Figure 8.2. | Recognise and Accept the Organic Reality Which Delivers Optimal Performance | 225 |
Figure 8.3. | Structured Cognitive Process Towards a Progressive Theory of the Firm | 229 |
Figure 9.1. | The Foundations of the Progressive Leadership Logic | 240 |
Figure 9.2. | Schematic of the Evolutionary Infiltration of a Progressive Leadership Logic – Phase 1 | 259 |
Figure 9.3. | Schematic of the Evolutionary Infiltration of a Progressive Leadership Logic – Phase 2 | 261 |
Figure 9.4. | Schematic of the Evolutionary Infiltration of a Progressive Leadership Logic – Phase 3 | 263 |
Figure 9.5. | Operational Implementation of the Progressive Leadership Logic | 268 |
List of Tables
Table 5.1. | Leadership Code of Conduct – Key Pledges | 126 |
Table 6.1. | The Oldest Firms Still Operating Today | 152 |
Table 6.2. | 17 United Nations Sustainable Development Goals | 171 |
Table 7.1. | ‘Established’ Foundation-Owned Companies Around the World | 183 |
Table 7.2. | Danfoss Sales by Business Segment | 191 |
Table 7.3. | Megatrends – Danfoss Action Plan | 194 |
Table 7.4. | Novo Nordisk Strategic Aspirations for 2025 | 204 |
List of Boxes
Box 2.1. | Key Issues for Consideration by Leadership in the Twenty-First Century Firm | 42 |
Box 2.2. | Impact of the Prevailing Form of Capitalism on Firm Priorities | 44 |
Box 2.3. | The Theory of the Firm: Key Questions | 46 |
Box 2.4. | Three Types of Relations | 47 |
Box 2.5. | Leaders as Moderators: Key Implications | 49 |
Box 2.6. | Tough Questions Operational Leaders Must Ask Themselves | 53 |
Box 2.7. | Required Areas of Change to Pillars which Sustain Today’s Firm58 | |
Box 3.1. | Fundamental Questions Towards Creating a Relevant Theory of the Firm | 74 |
Box 3.2. | Directors’ Safety Parachute Against Shareholders | 77 |
Box 3.3. | A Re-Definition of ‘Employee’ | 80 |
Box 4.1. | Fundamental Leadership Traits | 88 |
Box 4.2. | The Practical Inconsistencies of Classical Economics | 96 |
Box 4.3. | Assumptions of Classical Economics Now Recognised as Illogical | 97 |
Box 4.4. | Pragmatic Realities Upon Which Behavioural Economics is Founded | 99 |
Box 4.5. | The Principles Underlying Prospect Theory | 100 |
Box 4.6. | The Logic of Change | 102 |
Box 4.7. | A ‘Get Real’ View of Leadership Capabilities | 105 |
Box 4.8. | The Realities of Bounded Rationality | 106 |
Box 4.9. | ‘Management Engineering’ Levers of Success | 108 |
Box 4.10. | A Recognition of the Multiplicity of Options in the Face of Perceived Inequity | 111 |
Box 4.11. | The Complex Cognitive Process in the Face of Disadvantageous Inequality | 112 |
Box 5.1. | Key Foundation Stones of a Blended, Progressive Leadership Proposition | 117 |
Box 5.2. | A Broader Leadership Perspective of Risk and Recompense | 123 |
Box 5.3. | New Skills Required of the Progressive Leader | 127 |
Box 5.4. | Steps to Eradicate A - - Holes from within the Firm | 130 |
Box 5.5. | The Relationship Between Change and Catastrophe | 132 |
Box 5.6. | Key Steps as an Instigator of Progressive Change | 135 |
Box 5.7. | The Roles and Responsibilities of the Real Progressive Leader | 136 |
Box 5.8. | First Steps Towards a Progressive Mindset | 137 |
Box 5.9. | Bureaucratic Versus Interactive – Priority Characteristics | 142 |
Box 5.10. | The Role of the Board in Implementing a Progressive Theory of the Firm | 144 |
Box 6.1. | Factors Which May Sustain Firm Longevity | 151 |
Box 6.2. | Carolyn McCall – Chief Executive of ITV plc | 156 |
Box 6.3. | John and Irene Hays – Hays Travel | 158 |
Box 6.4. | Andrew (Andy) Haldane – Chief Economist and Executive Director of the Bank of England | 160 |
Box 6.5. | Dominic Barton – Global Managing Director of McKinsey & Company 2009–18 & Subsequently Canadian Ambassador to China | 163 |
Box 6.6. | Paul Polman – Former CEO of Unilever 2009–19 and Co-founder of Imagine | 168 |
Box 7.1. | 8 Principles of Longevity | 180 |
Box 7.2. | Components of the Progressive Leadership ‘Recipe’ | 180 |
Box 7.3. | Progressive Indicators | 181 |
Box 7.4. | Industrial Foundations Pose Three Fundamental Questions | 182 |
Box 7.5. | Shareholders No Longer Tick the Boxes as Firm Owners | 182 |
Box 7.6. | Cordant Group: Challenges to the Values and Principles of the Prevailing Theory of the Firm | 187 |
Box 7.7. | Cordant Group: Our Guiding Principles | 190 |
Box 7.8. | Recognising and Rewarding All Forms of Capital for Optimal Performance | 196 |
Box 7.9. | Key Points to be Recognised from Danfoss A/S Profile | 198 |
Box 7.10. | The Essentials | 203 |
Box 7.11. | Beneficiaries of Novo Nordisk Surplus | 207 |
Box 7.12. | Key Points Which Differentiate the Bosch Entity from the Dominant Corporate Governance Model | 214 |
Box 7.13. | Key Questions for Tomorrow’s Theory of the Firm | 217 |
Box 7.14. | Progressive Versus Prevailing Theory of the Firm – Fundamental Differences | 218 |
Box 8.1. | Reality Check Before Beginning the Journey | 222 |
Box 8.2. | Leadership Enlightenment as a Bottom/Middle–Up Phenomenon | 226 |
Box 8.3. | Key Insights and Responsibilities of the Progressive Leader | 227 |
Box 8.4. | Progressive Firm Leadership – What Is Possible from Where You Are Standing In the Firm | 232 |
Box 9.1. | ‘Sober’ Progressive Leadership Realities | 242 |
Box 9.2. | Core Components of Communication Script(s) to Emphasise a Change in Logic | 244 |
Box 9.3. | Meetings: Operationally Embedding the Progressive and Psychological Logic | 247 |
Box 9.4. | Action Points to Embed a Progressive, Psychological Mindset Firmwide | 251 |
Box 9.5. | The Ebb and Flow of Responses at the Firm’s Apex | 254 |
Box 9.6. | Responses at the Apex to Core Operational Components of the Progressive Logic | 255 |
Box 9.7. | Psychological Stealth and Tactics Towards ‘Conversion’ | 257 |
Box 9.8. | Phase 1 – Objectives of Evolutionary Infiltration of Progressive Leadership | 258 |
Box 9.9. | Phase 2 – Objectives of Evolutionary Infiltration of Progressive Leadership | 260 |
Box 9.10. | Phase 3 – Objectives of Evolutionary Infiltration of Progressive Leadership | 262 |
Box 9.11. | A Pragmatic Approach to Progressive Inculcation Within the Firm | 265 |
Preface
Whilst outwardly exuding an air of confidence and competence I, like many others, have for long recognised that there was some deeply embedded factor, silent and hidden to many, yet not all, creating a fog of confusion within the firm, acting as a significant drag factor on operational effectiveness and the attainment of optimal firm performance. The result has been that perspiration, persistence, silent acquiescence and a determined, if often blinkered focus, rather than an understanding of and consensus on firm purpose, guiding principles and priorities, have largely been the primary determinants in achieving firm targets, objectives and career progression. Any efforts to address this drag factor by one or a number of individual leaders, whilst often instinctually and widely acknowledged as overdue, were consciously or subconsciously viewed with suspicion and fear, if not belligerence for their potentially negative career implications.
My previous books have fleetingly alluded to this apparently immovable and embedded operational leadership blindspot. However, after some decades as an operational manager and leader within a variety of national and global firms, aided by scholarly research, I have in this text sought to question and undermine the purpose, principles and perspectives which continue to support a pervasive logic which I consider to now be wholly dysfunctional within the twenty-first century business context. This dysfunction, in my view, has ultimately not only consistently created a severe negative impact on optimal firm performance and survival but also on socio-economic growth and well-being.
I therefore write this book as a means of readers achieving a short cut to relevant reflection and commitment. By this means, it is my intention to achieve a re-orientation in cognitive priority towards a more enlightened, progressive and psychologically focused leadership mindset in this dynamic twenty-first century business and socio-economic context. It is my hope that this will ensure more contextually relevant leadership insight, perspectives and priorities going forward, evident more during the front rather than the back end of future leaders’ careers.
Acknowledgements
Many individuals have contributed to the moulding and creation of this text, but a select few have been instrumental in its initiation and/or completion.
In terms of the broad multi-disciplinary content of this text I must acknowledge the disparate contributions of a number of highly distinguished scholars and practitioners whose inspiring and insightful work I utilised to weave a solid foundation for my “progressive” theory of the firm and leadership logic. In particular I must thank Sandra Waddock (Galligan Chair of Strategy, Carroll School Scholar of Corporate Responsibility, Professor of Management), Margaret Blair, (Professor of Law, Emerita, Milton R. Underwood Chair in Free Enterprise, Emerita, Vanderbilt Law School), Lorraine Talbot (Birmingham Law School, Professor of Company Law in Context), Dominic Barton ( Canadian Ambassador to China, formerly Global Managing Director, McKinsey & Co.), George Loewenstein (Herbert A. Simon Professor of Economics and Psychology in the Social and Decision Sciences Department at Carnegie Mellon University and director of the Center for Behavioral Decision Research) and George Ackerloff (university professor at the McCourt School of Public Policy at Georgetown University and Koshland Professor of Economics Emeritus at the University of California, Berkeley). These are all progressive leaders and innovators in their respective fields
In respect of those individuals and business organisations which expended the time and energy to furnish me with permission to quote from their published material, when others were more circumspect, if not mercenary, I particularly acknowledge the Harvard Business Review, Trine Kiar at Danfoss A/S, Scott Dille at Novo Nordisk A/S and Christian Mostrup at the Novo Nordisk Foundation.
I must of course thank Emerald Publishing for their professionalism, advice, guidance and kindness over the last three years. I thank Niall Kennedy, my commissioning editor, for so clearly seeing the wood for the trees and agreeing to commission the text. However, I must in particular thank Aiswarya and her predecessor Sheena for patiently and expertly responding to a constant stream of and often inane questions.
Last, but not least, I must thank Iris, my companion and wife, who has expertly dealt with the world outside of my study as I drafted and feverishly re-drafted the text what appeared to be ad infinitum.
- Prelims
- Introduction
- Part I: Hard Truths and Tough Solutions to Make Firm Leadership Relevant in the Twenty-first Century Business Context
- Chapter 1: Resist Malignant Normality
- Chapter 2: Re-imagining the Priorities of Capitalism in Order to Re-invent Leadership
- Part II: Let’s Lay the Foundations for Effective Firm Leadership
- Chapter 3: A Theory of the Firm for Today and Tomorrow
- Chapter 4: Let’s Think More about the Psychology of Leadership
- Chapter 5: Get a Feel for the Dynamic of the Progressive Leadership Psychology
- Part III: No Need to Re-invent the Wheel: Profiles of Progressive Individuals and Firms
- Chapter 6: Insights into Progressive Leaders’ Perspectives and Priorities
- Chapter 7: No Need to Re-invent the Wheel: Progressive Firm Profiles
- Part IV: I Am Spartacus!! Am I Spartacus? Operational Implementation
- Chapter 8: Think Like a Progressive Leader
- Chapter 9: Act Like a Progressive Leader
- References
- Index