Leaders who step down just as important as those who hold onto power

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Professor Ian Williamson believes leaders who step down when the time is right should be celebrated. Leaders who are willing to step up and then step down when an organisation’s priorities or direction change, should be recognised and rewarded as much as leaders who work their way up the…

Professor Ian Williamson believes leaders who step down when the time is right should be celebrated.
Professor Ian Williamson believes leaders who step down when the time is right should be celebrated.

Leaders who are willing to step up and then step down when an organisation's priorities or direction change, should be recognised and rewarded as much as leaders who work their way up the ladder and stay there.

That's the view of Melbourne Business School professor Ian Williamson, who argues that traditional views of leadership and leadership structures will need to change in a world that is more diverse and less certain.

Williamson, who was speaking at a leadership roundtable hosted by PwC partners Dani Fraillon and Peter Wheeler, says many businesses organise their shopfloor workers into small teams that switch leaders regularly depending on the tasks they are undertaking, or the targets they are trying to hit.

However, this does not typically apply to leaders at the top of a business, who tend to associate stability with lower risk.

Anna Young from Wesfarmers and Peter Wheeler from PwC
Anna Young from Wesfarmers and Peter Wheeler from PwC

But Williamson, who is the Helen Macpherson Smith Chair of Leadership for Social Impact at MBS, says that switching leaders to harness an individual's skills is actually less risky.

"You have to create an environment were being a leader and stepping down from leadership is just as heroic as holding on to leadership," he says.

Williamson says that leaders will increasingly struggle to "secure some legitimacy" to lead groups that are not only diverse in terms of gender and background, but, in a services-based economy like Australia's will probably include members with greater skills than the leader in certain areas.

"You cannot lead based on competency. The leader has to allow for more voices and less control."

Anna Young, an executive talent expert from Wesfarmers, told the roundtable, her company has worked to strike a balance between active and reflective leaders, who may be quieter by nature but better at deeper, strategic thinking.

"We tend to recognise the do-ers who make things happen. If you're a reflective leader it's harder, but we actually need those people," she says.

It was a point picked up by Bevan Warner, the managing director of Victoria Legal Aid, who describes a "race to efficiency" among leaders who "confused being busy with doing things really well".

"Maybe we need to dial up the reflective leadership to counter that sense of instant gratification," he says.

Key to developing the skills of future leaders is giving them the opportunity and support to make mistakes and learn from them, the participants agreed.

Adam Badenoch, a partner at executive placement group Heidrick & Struggles, argues that flatter organisational structures and greater risk controls that push responsibility for the profit and loss statement further up the chain, has actually made this more difficult.

"The opportunity to have that test case in a small business where a leader can live with the consequences of their mistakes is much more limited."

Young says Wesfarmers has focused on helping leaders be "externally aware" to ensure they understand the broader market.

This involved teaching leaders the discipline of setting aside time every week to talk to staff, others within their industry and experts outside their sector to ensure they had a diversity of views.

"In the next six months, who are the experts I am going to talk to?" is one question Wesfarmers leaders are asked.

Warner says he sees developing future leaders who can think strategically about as a key task as chief executive.

"You need to ask, what are the conditions for thought leadership, so that the leaders in the second or third tier can say, this is where we need to go," he says.

Dani Fraillon will lead a panel on future leaders at The Australian Financial Review Business Summit presented by BHP Billiton.


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