The Peter Principle - The Complexity of Change - Gartner′s Predictions for 2023 and so much more. Happy New Year to you!

As the first week of the year is coming to an end, it's time again for the Building Corporate Soul newsletter. Welcome to 2023. Enjoy the read.

The Current Environment is a Real Test for Corporate Cultures

?There is not one day without a headline of companies letting people go – and at the same time, companies are crying that they cannot find the right talent. Most individuals in the talent market are consistently searching for employers that delivers against the “Sense of Belonging” and the spirit of “Being valued by manager and organizations” as McKinsey&Co. researched last year.

In other words, they look for companies with soul, companies that value the impact and contributions of “their” people. Very often though, companies fail when it comes to delivering that sense of belonging. Leaders have a big responsibility against their company since it′s been proven that human-centric companies deliver more sustainable profits than their peers.

I recently came across Steven Bartlett′s 5 biggest company culture destroyers.

They are worth reflecting on. In times, when candidates ask in interviews questions like

1. Tell me about your culture?
2. What is the limit of my autonomy in the role? Also in terms of decision making.
3. What is the biggest reason, people leave your organization?
4. How do you handle #wellbeing for employees?
5. What does poor performance mean here and how do you handle it?
6. Why should I work here?

It′s important to have an answer ready. Otherwise, be prepared to continue searching for candidates that really want to join your firm.

Mind the Gap - Understanding how the Peter Principle might Undermine your Company

It deserved a place in my book “Building Corporate Soul” and whenever I talk to employees it often comes up when they complain about bad team leaders: The Peter Principle.

The Peter Principle is a concept in management developed byLaurence J. Peter, which observes that people in a hierarchytend to rise to their “level of incompetence”: employees are promoted based on their success in previous jobs until they reach a level at which they are no longer competent, as skills in one job do not necessarily translate to another. The concept was explained in the 1969 book The Peter Principle by Dr. Peter and Raymond Hull. The authors intended the book to be satire, but it became popular as it was seen to make a serious point about the shortcomings of how people are promoted within hierarchical organizations. Hull wrote the text, based on Peter’s research. The Peter Principle has been the subject of much subsequent commentary and research.

The visual from Merlin IT Consulting illustrates the issue perfectly. It′s an important lesson for leaders: As a number of those under-the-radar employees will stick around long enough to gain a “senior” title, and then you have a problem:?

? Earning the “senior” title loses its cachet.

? A low-skill “senior” employee is given a lead role, then cannot deliver.

? A high-skill intermediate or junior employee resents doing most of the project work, then quits.?

? A manager cannot hire a true rock star, because expensive, low-skill “senior” employees are consuming the budget.?

To avoid the Chronological Peter Principle:

?? Set a clear bar for advancing to Intermediate or Senior. This can be expressed as a “Capability Maturity Model”.

?? Hiring freezes should not apply to backfills. If a manager cannot replace a person who quits, then he is incented to promote low-skill employees.

?? Never promote based on years at the organization. If someone is (still) not ready, then do not promote.

Gartner′s 2023 Leadership Vision Analysis out - What Really Matters to HR Leaders this year

Gartner has just released their “The 2023 Leadership Vision for Chief HR Officers “As always, their analysis is full of very insightful reflections that are worth considering for hr professionals, but not just for them: they are leadership fodder at its best.

Here are the key takeaways

• Understand how the concept of human-centric leadership and associated behaviors aligns with your organization’s current leadership competency model and identify needed adjustments.
• Identify potential trade-offs that may need to be made between focusing on investing in leadership development programs and other business requirements.
• Assess your own strengths and development areas as a human-centric leader and identify opportunities to display authenticity, empathy and adaptivity with your own team.
• Adjust leadership development programs to develop human-centric qualities (while maintaining a focus on business needs) and update succession strategies to identify successful human-centric leaders in high-impact roles.
• Position HR team members to identify employees who can share diverse perspectives with leaders in order to catalog high- and low-stakes opportunities for leaders to display vulnerable human leadership.
• Ask your leadership team to actively commit to clear expectations for human-centric leadership by providing the option to choose between people-leadership and non-people-leadership career pathways.

Some key slides are shown below:CEOs put workforce on a higher place when it comes to their priorities. It′s been #5 and has made its way up to #3.

Every Leader is Different –?

What are the Various Leadership Models?

Simon Ash just released a great article?LEADERSHIP UNLOCKED?which reflects on the leadership models every (great) manager should know.

Great-man theory

Great Man theory (1840) is one of the oldest leadership theories. It is the idea that true leaders — or heroes — are born with the innate ability to shape history. Thomas Carlyle was a historian, and he came up with the theory based on the examples of key historical figures such as Napoleon Bonaparte. (…): control and domination, power, and influence. Great Man theory was linked to the idea of power and that leaders would naturally dominate others by the strength of their personality.

Action-centred leadership

John Adair’s Action-Centred Leadership model (1979) was built on the premise that leadership skills and behaviors could be taught and adopted. The simple idea behind Action-Centred Leadership is the need to balance the three core management priorities of task, team and individual.

Transactional and transformational leadership theories

James MacGregor Burns took the ideas of influence and behaviour in another direction when he defined the difference between Transactional and Transformational leadership (1978). Transactional leadership is management using a carrot and stick approach. Bernard Bass (1985) built on the work of Burns and defined the key behaviours of the transformational leader as being:

1. a positive role model,
2. providing encouragement and
3. supporting followers to fulfil their potential.

Situational leadership theory (flexible leadership)

The Situational leadership model, developed by Paul Hersey and Ken Blanchard, (1985) took leadership theory in another slightly different direction. Their model is about having a flexible approach. It demonstrates how a leader can adapt their management style depending upon the experience of the team and individuals they are working with, while also considering the environment and circumstances they find themselves in. The leader chooses their approach — either delegating, supporting, coaching, or directing — depending upon the situation.

Values-based leadership

Values-based leadership developed in response to various moral failings of prominent leaders. This school of leadership — related to trait theory — encompasses both servant leadership and authentic leadership models. The central idea is that the values-based leader has a strong moral compass and leads according to their personal values and the shared values of their organisation or community.

Servant leadership theory

The idea of ‘the servant as leader’ was developed by Robert Greenleaf (1977). This model of servant leadership is primarily about motivation. The servant-leader wants to serve others and society by raising up new leaders and helping people move towards a positive vision of the future.

Toxic or bad leaders

At the other end of the scale, academics also started to identify the opposite of values-based or good leaders. Marcia Lynn Whicker popularized the term ‘toxic leader’ (1996) and various models have been developed to identify such bad leadership.

Authentic leadership theory

The term authentic leadership was first popularized by leadership practitioner Bill George (2003). He wrote a book, by the same name, in response to failures of senior corporate management, such as the fraudulent behavior that led to the fall of the energy giant Enron (2001). George advocated for leaders of “purpose, values and integrity” rather than those motivated by greed and power.

?Ash summarizes about the importance of these models: “They give us language and concepts that help us reflect on our leadership experience and the conduct of others. They give us tools to use in our leadership practice. They act as signposts to ways we can develop and grow as leaders on our path from good to great

And you can start now. Take a few moments to reflect. Which of the leadership theories above most intrigues you? What does this model reveal about your own leadership? Which tool could you apply in the interactions you have today?” Here's the link to the full article.

The Complexity of Change

This is such a great slide as it shows the interdependence of the key factors vision, skills, incentives, resources and action plan when it comes to managing change. Only if all five factors are considered are in place, desired change can happen. Given that a significant number of change projects fail, it is important to be aware of the impact when certain factors are missing.?

Bad Apples or Bad Leaders??

MIT Sloan Review research identifies the impact of leadership on deviant employee behaviors

Another great piece from 美国麻省理工学院 - 斯隆管理学院 : “Leaders typically take responsibility when employees perform poorly but not when employees behave badly. It’s like there’s an unwritten rule that protects leaders when employees engage in deviant workplace behavior. Perhaps this protection stems from the notion that it isn’t fair to hold leaders accountable for the actions of a few bad apples.

Our research suggests that surprisingly often, this view of workplace deviance is misguided. We’ve found that leaders have a strong effect on whether employees engage in deviant behaviors. Thus, when employees act badly, their leaders would be wise to take a step back and consider whether and how they may be complicit in that behavior.

Workplace deviance includes employee behaviors that violate organizational norms in ways that threaten the well-being of companies and their employees. Sometimes these behaviors are directed toward individuals, such as when an employee physically or verbally lashes out at a colleague or gossips with coworkers. Other times, deviant behaviors are directed toward an organization, such as when an employee steals workplace property or leaks confidential company information. The consequences of workplace deviance include productivity and inventory losses, as well as a host of other expenses that ultimately cost organizations billions of dollars annually.?Great piece of leadership insight - straight via this link.

The Society of HR Management in the UK have issued their Leadership Resolutions for 2023

HR’s new operating model – very interesting insights from 麦肯锡

The consulting firm interviewed more than 100 chief human resources officers and people leaders to gain insights on how the HR operating model is changing to drive value in a volatile business environment.

Here′s the summary of what they found out: “The way in which organizations manage people used to be relatively straightforward. For more than two decades, multinational companies generally adopted a combination of HR business partners, centers of excellence, and shared service centers, adjusting these three elements to fit each organization’s unique nature and needs.

Today, this approach—introduced by Dave Ulrich in 19961—is rapidly evolving. In interviews with more than 100 chief human resources officers (CHROs) and senior people leaders from global multinational businesses, we identified five HR operating-model archetypes that are emerging in response to dramatic changes in business and in the world—including heightened geopolitical risks, hybrid working models, and the rise of majority-millennial workforces.

These emerging operating models have been facilitated by eight innovation shifts, with each archetype typically based on one major innovation shift and supported by a few minor ones. The key for leaders is to consciously select the most relevant of these innovation shifts to help them transition gradually toward their desired operating model.”

?They have identified eight innovation shifts driving HR’s new operating models

1. Adopt agile principles?to ensure both strict prioritization of HR’s existing capacity and swift reallocation of resources when needed, enabling a fundamentally faster rate of change in the business and with people and how they work.
2. Excel along the employee experience (EX) journey?to win the race for talent in the time of the?Great Attrition,4?enabling both employee health and resilience.
3. Re-empower frontline leaders in the business?to create human-centric interactions, reduce complexity, and put decision rights (back) where they belong.
4. Offer individualized HR services?to address increasingly varied expectations of personalization.
5. Productize’ HR services?to build fit-for-purpose offerings with the needs of the business in mind, and to enable end-to-end responsibility for those services through cross-functional product owner teams in HR.
6. Integrate design and delivery with end-to-end accountability?to effectively address strategic HR priorities, reduce back-and-forth, and clarify ownership.
7. Move from process excellence to data excellence?to tap into novel sources of decision making using artificial intelligence and machine learning.
8. Automate HR solutions?to drive efficiency and capitalize on the power of digitalization in HR.

Read all the details here.

My best wishes for your 2023! Let's continue to make soulless companies a thing of the past. The next edition of the Building Corporate Soul newsletter will be in your mailbox in two weeks on January 26.