José Luis Alvarez, Professor of Organizational Behavior at Instituto de Empresa
Leadership is a conceptual construct full of different assumptions -academic and ideological-and one that can be looked at from many different perspectives. In a forthcoming book (November 2005) I coauthored with my colleague Silviya Svejenova (Sharing Executive Power: Roles and Relationships at the Top, Cambridge University Press) we focus on and question one of these assumptions: that leadership is exercised on an individual basis. Among the exceptions to this generalized assumption is David Heenan and Warren Bennis’ book on co-leaders, which provides a collection of accounts of collaborations between a leader and a leader’s lieutenant.
Recently, another exception has appeared in the volume Shared Leadership edited by Craig Pearce and Jay Conger. Shared leadership, which these authors define as a dynamic, interactive influence process among individuals in groups for which the objective is to lead one another to the achievement of group or organizational goals or both, has two causes in common with small numbers at the top. 1) Senior leaders of complex organizations do not usually possess all the relevant information and competencies; and 2) the complexity of the CEO’s job means that it is difficult to fill with one person.
Our focus is reflected in two articles on the topic: D. Sally (2002) and J. O’Toole, Jay Galbraith, and Edward Lawler III (2002). These authors provide splendid accounts of the existence of co-leadership and a wealth of evidence of its spread. Perhaps the main difference between our work and theirs is that we focus specifically on corporate governance structures. And having the length of a book at our disposal, we have been able to embed the explanations of the phenomenon within two traditions in organization theory: contingency theory and role theory.
An influential book by Rakesh Khurana (2002) contains a sociological inquiry into the excesses of individualism in corporate governance. Khurana uses Weber’s notion of charisma to explain the celebrity status of some CEOs in the USA in the 1990s, and some of the gaps between excessive expectations and delivery. Khurana argues that the contribution of people at the top toward the results of organizations is especially susceptible to biases in attributions because it is the executives to whom it is more difficult to give credit for organizational results. At the apex, the distinction between means and ends is more ambiguous, performance is over determined, and causalities follow the rule of equifinality. As a consequence, giving credit for organizational results becomes a social construction.
Investor capitalism has extended ownership rights to a multitude of dispersed small investors who cannot follow the nuances of the evolution of the shares in which they invest; nor can they easily understand the reasons for the performance of corporations or predict their future evolution. Consequently, these non-professional atomized multitudes, fed by an ever-increasingly influential financial press, have no option but to allow themselves to track external signs through which they try to infer the causes for corporate performance. Therefore, a variety of reasons ranging from our genetic cognitive biases through the individualism of western societies to the role of the press in legitimating business practices (see my work with my colleague Carmelo Mazza, 2000) feed the attribution fallacy that has enabled CEOs to gradually acquire an aura of causality and charisma. Thus Khurana argues that ‘Boards wish to find a new CEO with as much star power as possible, because a high-profile, high status appointment is almost certain to inspire public confidence in the company and immediately boost share prices (p. xii).
In Sharing Executive Power we build upon the work of all these authors who question two basic assumptions: 1) that executive leadership is a solely individualistic job, and 2) that trust based interpersonal relationships at the top must be viewed with suspicion.
One of the first things we should share with leadership students is that there is no easy answer to the challenges it poses, that there are different alternatives in conceptualizing it, many of them legitimate, and that leadership is an intensely personal affair, but not a solipsistic one, but one that is shared with others.
Full academic references of the books referred to are available through José Luis Alvarez (josel.alvarez@ie.edu)
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