Confusing Contrast
The Proverbial S Curve
Leadership does not have a simple formula for every situation. A lot of the leadership theory comes from academicians studying a formulation of their leadership model from observing the real world. They test the model with empirical research to determine results on performance. Then, it’s the publish or perish phenomenon. Look at the chapter headings from a well-known college text by Northouse entitled Leadership: Theory and Practice. We find a long list of these type models as well as some more generalized topics: Trait Approach, Skills Approach, Behavioral Approach, Situational Approach, Path-Goal Theory, Leader-Member Exchange Theory, Transformational Leadership, Authentic Leadership, Servant Leadership, Adaptive Leadership, Followership, Leadership Ethics, Team Leadership, Gender and Leadership, Culture and Leadership. Wow, how do you sort out all these concepts? And this is just a college textbook articulating all these different perspectives. There are lots of other relevant authors both academicians and practitioners not included in the chapters listed above such as Strength Based Leadership.
The purpose of this blog is to weave the story that power is the interwoven fabric of leadership. You might say, “You will have to convince me. Rosabeth Moss Kanter once wrote that “Power is America’s last dirty word. It is easier to talk about money, and much easier to talk about sex, than it is to talk about power.”[i] Power and politics are often equated but they are not the same thing although deeply related. Politics often relates to the influencing strategies and tactics within governments, which are usually quite contentious particularly at the federal level today. In the American democratic construct, there are two opposing sides trying to gain the upper hand to impose their point of view through vehicles not always healthy for the nation. In many respects, power by its association with politics remains a very dirty word in this 21st century. Of course, there are still lots of power plays in many organizational settings that are detrimental perpetuating this sinister view of people who use power.
In talking with small business owners, I am surprised how many have trouble off the top of their heads responding to simple questions like what are your revenues, how much is in your bank account, and what is your cash flow? Research studies find over 80% of the time poor cash management or poor understanding of cash flows contributes to the failure of a small business. Another way of describing this predominant problem is a lack of funding or working capital. It is amazing how many people just jump into business without planning and understanding their working capital needs. Even the term working capital is foreign to their vocabulary. So, if you don’t know, it is the capital in the business used for short-term operations. You take what are current assets such as cash in the bank, receivables, and inventory less the current liabilities and obligations you need to pay out in the short term considered less than a year. You need to know more than what is working capital. Somehow accounting leaves many with that deer-in-the-headlights look. In many ways, I understand. Even though I have a master’s in accounting, it was never my favorite subject. But I also understood back then when getting my degree that accounting is the language of business and a necessity for running businesses. In teaching a Corporate Strategy course to undergraduate business school seniors, far too many of the students didn’t understand balance sheets, income statements, and cash flow statements even though they had introductory accounting courses.