In a recent leadership survey conducted by Duke University's School of Business, it was found that there is a direct correlation between competent leadership and a company's bottom line. Why is this news?
You know how you'll hear about some million dollar research study that heeds a result that comes as no surprise at all? Like, "The Center for Obvious Results just completed its double-blind four-year study of 567 skiing accident victims and concluded that broken legs can be painful." You just wonder how the people involved were able to get grant money to confirm.
I had one of those moments yesterday from an e-mail I received. To be fair, this one wasn't an extensive study — more of a survey — but my overall reaction was still "Well, duh!" The groundreaking conclusion of the study? There is a relationship between organizations' financial performance and assessed senior leadership skills.
OK, let me back up a bit to be fair. In the fall of 2008, the Fuqua/Coach K Center on Leadership & Ethics at Duke University's Fuqua School of Business conducted The Duke Executive Leadership Survey. Two hundred and five executives were surveyed on a number of leadership issues. The study identified these skills as being most important in leaders:
- Promoting an ethical environment
- Acting with authenticity
- Accurately interpreting the competitive environment
- Developing trust
So far, so good. I mean, I'm glad that "being able to effectively exterminate any obstacles that stand in your way" did not make the top five. But the study also concludes that those skills associated with inspirational and ethical leadership were most strongly associated with organizational performance.
I realize that the world is littered with companies that are wildly successful because they exercise Montgomery Burns business practices. And I know that a couple of the most successful companies in the world also happen to treat their employees like mongrels in a low-rent puppy mill.
But wouldn't strong, ethical leaderhip almost always produce a happier and more productive workforce? This also came from the study: Researchers have found that followers who see their leaders as more competent and trustworthy also evaluate those leaders as being more inspirational.
I would hope so! Have you ever heard an employee complain that he really isn't inspired by a bunch of competence and trust? And this: The research also established that there is "a connection between inspirational leader behaviors and follower performance." Isn't that the definition of inspiration?
I worry about the people for whom this information will be news. My worst fear is that some business leader out there will see it and think, hey, I should try this whole trustworthy schtick and see if it makes us more money.
The issue with studies/surveys like this is that they, by design, oversimplify complicated issues. If you are a trustworty and competent leader, good results will follow naturally. That fact should not have to be verified by a study.
Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.