Who is leading?

Our post Next stop – FinTechGiants touched on the three structures existing in any organization:
  • a formal structure of power, required to perform business and ensure regulatory compliance
  • an informal structure of social networks and communication paths
  • a value creation structure which solves problems and produces the values 
All three structures exist in each and every organization or company and each has its own leaders. Leadership is one of the often used terms. But what is a leader? What is leadership? 
  • Leadership is the result of a social process 
  • It is something which happens between people
  • It is typically the result of a bottom-up process 
  • And it often requires passion, inspiration and motivation to jointly achieve a goal
Leadership is something which cannot be actively assigned – it needs to be earned or gained. It is about being respected or accepted as a leader. 
The roles in the formal structure are assigned. They are 
  • typically the result of a top-down assignment
  • they give position power 
  • they allow controlling a group to achieve a goal
  • they come with clear expectations by those with more power who made the assignment
  • often results of internal politics used to secure or gain assigned power
Having such a formal position does not imply being a leader – it just implies control or management power. While a good leader typically also has management skills there are many managers which are no leaders. Individuals with important formal roles in companies often start to separate themselves from the rest. They become an elite in an organization and lose the contact with the base. Many of them also have no vision to share and hence focus on managerial or material aspects driven by the fear to fail. This is not sufficient in the current time of change where companies need leaders to move successfully towards a shared vision by giving direction.

Author: Mad Meier

Exploring the blurring boundaries of the physical and digital realities and the interplay of innovation, technology, and society.

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