The Organisational Leader and Sustainable Organisational Performance

Stage 1

Hubris Born of Success

Markers

Issues

Drivers

Success entitlement, arrogance:

It’s when success is viewed as “deserved” rather that fortuitous, fleeting or even hard earned in the face of daunting odds. The people started to believe that success will continue no matter what the organization decides to do, or not to do.

Participating in arrogant neglect.

Neglect of a primary flywheel:

When leaders are distracted by extraneous threats, adventures and opportunities, the neglect a primary flywheel. Which cause failing to renew.

 Taking undisciplined leaps into areas where an organisation cannot become the best.

“What” replace “Why”:

The rhetoric success; An organisation thinks they’re successful for doing specific things replaces the understanding and insight; An organisation is successful because the understand why they’re doing what they do and under what conditions it won’t work anymore.

Leaders take bold, risky decisions that fly in the face of conflicting or negative evidence.

Decline in learning orientation:

This happens when leaders lose the curiosity and learning orientation to mark truly great individuals.

There’s a denial of the possibility that the enterprise could be at risk, imperiled by external threat or internal erosion.

Discounting the role of luck:

Without acknowledging the role luck and fortuitous events might have played a helpful role, organisations begin presuming that success is due entirely to the superior qualities of the enterprise and its leadership

When an organisation’s pursuit of growth beyond what it can deliver with excellence.

Impact and consequences

The organisation will need to exit the market or renew obsessively. Both will have tremendous costs and the organisation may turn their attention back to their primary flywheel just to find it wobbling and losing momentum.  

Stage 2

Undisciplined Pursuit of More

Markers

Issues

Drivers

Unsustainable quest for growth, confusing big with great:

Success can create pressure for more growth, which also create a vicious cycle of expectations. This stains people, the culture and systems to breaking point. Being unable to deliver consistent tactical excellence, the organisation will start fraying at the edges.

Compromising value and losing sight of core purpose while pursuing growth and expansion.

Undisciplined discontinuous steps

When an organisation makes dramatic moves and fail at least one of the three tests; It doesn’t fit in which the core values, can’t be the best at these activities/or arenas; these activities don’t drive economic or resource of the organisation.

Keep investing heavily in arenas where the organisation can’t attain distinctive capability that’s better than those of the competitors.

Declining proportion of right people in key seats

There is a declining proportion of right people in key seats, because of losing the right people and/or growing beyond the organization’s ability to get enough people to execute on that growth with excellence 

When a leader fails to develop strong successors (or drives the strong ones away).

Easy cash erodes cost discipline:

The organization responds to increasing costs by increasing prices and revenues rather than increasing discipline.

Taking action inconsistent with the core values

Bureaucracy subverts discipline

A system of bureaucratic rules the ethic of freedom and responsibilities (think in terms of “jobs” and not responsibilities).

Addiction to scale

Problematic succession of power

When the organisation experiences leadership-transition difficulties

Discontinuous leaps into arenas without passion for it

Personal interest placed above organizational interest.

People in power allocate more for themselves or their constituents – more money, more privileges, more fame, more of the spoils of success

Using the organisation for own personal success

Impact and consequences

Leaders that fail the process of succession set their enterprises on a path to decline. But however and whenever it happens, one of the most significant indicators of decline is the reallocation of power into the hands of leaders who fail to comprehend and/or lack the will to do what must be done – and equally, what must not be done – to sustain greatness