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An analysis of the contribution of leadership to organisational performance using complexity science

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Purpose ‐ The purpose of this paper is to explore the leadership tasks at the different hierarchical levels in the organisation in terms of the teleological approaches to complexity science. Design/methodology/approach ‐ It is based upon a theoretical discussion linked to conceptual and managerial frameworks in conjunction with a conceptual analysis. Findings ‐ The introduced conceptual and managerial frameworks provide a foundation to the understanding of organisational performance. They also strive to offer a foundation of understanding to management and leadership and how they complement each other. Research limitations/implications ‐ It is not easy to empirically substantiate complexity in conceptual and managerial frameworks. The authors use teleological approaches of complexity science in an unorthodox way that need validation in a broader context offering opportunities for further research. Practical implications ‐ We need to think differently about organisational performance and how we present and reflect on information that appears to be "linear" although it is not necessarily the case. Originality/value ‐ The paper contributes to an alternative assessment organisational performance. It endeavours to reflect on the complexity of organisations and taking into account a pluralistic approach that synthesises a variety of perspectives, including a bottom-up approach to problem solving.
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Journal of Management Development
An analysis of the contribution of leadership to organisational performance using
complexity science
Hester Nienaber Göran Svensson
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Hester Nienaber Göran Svensson, (2013),"An analysis of the contribution of leadership to organisational
performance using complexity science", Journal of Management Development, Vol. 32 Iss 8 pp. 836 - 851
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An analysis of the contribution of
leadership to organisational
performance using complexity
science
Hester Nienaber
UNISA, Pretoria, South Africa, and
Go
¨ran Svensson
Oslo School of Management, Oslo, Norway
Abstract
Purpose – The purpose of this paper is to explore the leadership tasks at the different hierarchical
levels in the organisation in terms of the teleological approaches to complexity science.
Design/methodology/approach – It is based upon a theoretical discussion linked to conceptual and
managerial frameworks in conjunction with a conceptual analysis.
Findings – The introduced conceptual and managerial frameworks provide a foundation to the
understanding of organisational performance. They also strive to offer a foundation of understanding
to management and leadership and how they complement each other.
Research limitations/implications – It is not easy to empirically substantiate complexity in
conceptual and managerial frameworks. The authors use teleological approaches of complexity
science in an unorthodox way that need validation in a broader context offering opportunities for
further research.
Practical implications – We need to think differently about organisational performance and how we
present and reflect on information that appears to be “linear” although it is not necessarily the case.
Originality/value – The paper contributes to an alternative assessment organisational performance.
It endeavours to reflect on the complexity of organisations and taking into account a pluralistic
approach that synthesises a variety of perspectives, including a bottom-up approach to problem
solving.
Keywords Leadership, Performance, Management, Complexity, Organisation, Teleology
Paper type Conceptual paper
Introduction
The role of leadership in contributing to the achievement of organisational
performance has come under scrutiny of late (Karp and Helgø, 2009; Richardson,
2008; Svensson et al., 2008) as empirical support for the (direct) link between leadership
and organisational performance is lacking (Svensson et al., 2008). A number of studies
(Karp and Helgø, 2009; Richardson, 2008; Svensson et al., 2008) have proposed the
application of complexity science in understanding the relationship between leadership
and organisational performance. The core of complexity science includes five aspects,
namely, action, fitness, strategies, predictability and emergence, and specifically the
relationships between them (Wallis, 2009).
None of these studies, however, has attended to the integration of the different
teleological approaches to complexity science (Stacey et al., 2000) as put forward by
Svensson et al. (2008) and the tasks and activities of leadership and management
as proposed by Nienaber (2010). In essence, the teleological approaches refer to the
nature of the future and specifically whether the future is given or under perpetual
The current issue and full text archive of this journal is available at
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Journal of Management Development
Vol. 32 No. 8, 2013
pp. 836-851
rEmerald Group Publishing Limited
0262-1711
DOI 10.1108/JMD-08-2011-0101
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construction which influences leadership’s role on organisational performance (see
Svensson et al., 2008). Svensson et al. (2008) focus on three teleological approaches,
namely formative, rationalist, and transformative. These three approaches, as well as
the tasks and activities of leadership at the different hierarchical levels, are expanded
on in the next section.
The objective of this paper is to explore the leadership tasks at the different
hierarchical levels in the organisation in terms of the teleological approaches
to complexity science in an effort to aid leadership decisions and actions to emerge
as the future unfolds, with a view to optimising organisational performance by acting
collectively and securing the organisation’s survival in the long term.
This paper contributes to the ongoing debate on leadership in organisational
performance, specifically by expanding on the work of Svensson et al. (2008) and
Nienaber (2010) by exploring how the different layers of leadership can contribute to
organisational performance in view of various states of uncertainty. It advocates a
pluralistic approach that synthesises a variety of perspectives, including a bottom-up
approach to problem solving, in which the knowledge and experience of employees are
taken into consideration to ensure organisational performance.
The rest of the paper is organised as follows: a frame of reference is presented;
the relevance of complexity sciences in organisational performance is discussed;
conceptual and managerial frameworks are described; managerial and theoretical
implications are discussed; a conceptual analysis is performed; and concluding
thoughts and suggestions for further research are provided.
Frame of reference
The leadership cadre of organisations is ultimately charged with the responsibility of
organisational performance (Nienaber, 2010). Hence, they are the drivers
of performance in the organisation (Bernthal et al. 1997; Crotts et al., 2005; Jamrog
et al., 2008; McManus, 2008). Organisational performance has recently received
heightened attention in the literature (Broadbent and Laughlin, 2009; Burkert et al.,
2011; Ferreira and Otley, 2009; Muras et al., 2008; Svensson et al., 2008). The essence
of these papers is that performance management is complex, interpreted to mean
different things to different people and often misunderstood, causing more confusion
than clarity. The importance of people in general and managers in particular in
achieving organisational performance is acknowledged. Despite the importance of
people, irrespective of their position in the organisational hierarchy, in achieving
organisational performance, various studies have found that efforts to capitalise on
people’s contribution to organisational performance remain ineffective (Fegley, 2006;
Harvey, 2009; Linne, 2009; Nancherla, 2009). Furthermore, the direct influence of
leadership on organisational performance is disputed in the literature (Svensson et al.,
2008). This disagreement is understandable for a number of reasons. One is that
leadership (CEO and top management) sets the direction of the organisation, which is
executed by lower levels of management (Nienaber, 2010) in a given context. Therefore,
the leadership is not the sole actor in organisational performance (and should not
claim all of the rewards). Furthermore, organisational performance is equated to the
economic performance it produces (Drucker, 1955), and expressed as financial gain
(Ronda-Pupo and Guerras-Martin, 2012), which is dependent on a number of multi-
faceted factors, like employees, customers and society (Ghoshal, 2005, p. 80;
Heskett et al., 1994; Svensson and Wood, 2005) and the environment (Hellriegel et al.,
2008; Jones and George, 2007; Nienaber and Roodt, 2008). In more precise terms,
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organisational performance is generally associated with goal achievement and more
specifically financial gain (see Nag et al., 2007; Ronda-Pupo and Guerras-Martin, 2012).
Ultimately, the aim of organisational performance is change, thus ensuring the
survival and growth of the organisation in the long term. Hence, it is difficult to
determine the exact contribution of each factor to the outcomes achieved (Richardson,
2008) and it is reasonable to maintain that leadership’s contribution to organisational
performance is inflated, as proposed by Svensson et al. (2008).
The phenomenon of top management’s inflated contribution to organisational
performance was also found by Hooghiemstra (2008), showing that both Japanese
and the US managers reported organisational performance in a self-serving way; i.e.
managers take personal credit for successes and deny responsibility for failures,
attributing them to external causes that are beyond their control. A possible reason
for this self-serving behaviour is to minimise the impact of negative exposure on
the business while preserving the esteem of the managers and inspiring confidence
and motivation (Hooghiemstra, 2008). This phenomenon confirms the principle
that management is accountable for results that are within their control and that top
management seems to cope with uncontrollable factors more effectively than
lower management and staff (Burkert et al., 2011), which may contribute to the inflated
role of leadership in organisational performance. Other reasons for the inflated role of
leadership in organisational performance stems, inter alia, from the literature’s
portrayal of a top-down approach to management as being superior to a bottom-up
approach (Svensson et al., 2008). The literature implies that a command and control
management system safeguards organisational performance, while (seemingly)
ignoring the contribution of employees. This view is further advanced by presenting
leadership as individualistic, relying on a simplistic, linear approach, which assumes
that approximate and tentative knowledge is complete and accurate (Richardson, 2008)
and thus sufficient to secure future performance. However, organisations are complex
systems (Mumford, 2011), as alluded to earlier, the management of which is
complicated by a number of factors, among others interactions among various parts of
this system (Richardson, 2008). Notable in this regard are interactions among diverse
people. These interactions are complex and uncertain processes (Karp and Helgø, 2009)
because of their networked nature (Richardson, 2008), which is all but simplistic. It is
therefore contended that leadership is limited in knowing and/or predicting the future
accurately, which places limits on what can be achieved in a pre-determined way. As a
result, it is not surprising that the realised results of the organisation fall short of the
planned results (Mankins and Steele, 2005; Mintzberg, 1973; Tait and Nienaber, 2010).
Relevance of complexity science in organisational performance
Complexity science is generally associated with the natural sciences, specifically
disciplines like physics, mathematics and biology, but it also has application in social
sciences. This holds true for general management of which leadership forms
an integral part (Nienaber, 2010). In the case of (general) management, the application
of complexity science stems from the evolution of systems theory, given that
the organisation is seen as an open, social system necessitating management to be
responsive to their environment (external as well as internal). Responsiveness is
necessary to facilitate the organisation in pursuing its goals to ensure its survival,
and ultimately its performance. The openness, as well as the responsiveness of the
organisation, causes uncertainty, at least to a degree, for the organisation in terms of its
future survival.
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In managing the organisation, leadership (especially the CEO and top management),
adheres to one or more school of management thought (Hellriegel et al., 2008; Jones and
George, 2007; Nienaber and Roodt, 2008), whether knowingly, consciously, explicitly
and deliberately or not (sometimes management consultants may advise the CEO on
the prevailing contemporary application without regard to the appropriateness,
of the school of thought promoted, to the client concerned). It may be that one school of
thought dominates the thinking and action of the leader(s) or it may be an integrated
approach, of which the leader may not even be consciously aware. The schools of
management thought form part of the documented body of knowledge underpinning
the management discipline, of which leadership is an integral part (Wren, 2005) and
which in turn forms part of the social sciences. As such, management (and leadership)
is an applied science, which is concerned with the study of a business that productively
satisfies the needs and wants of its customers. It stands to reason that the study of
management (and leadership) entails research, which examines management problems
and principles to assist business to best direct their efforts towards goal achievement
(performance/high performance) (Du Toit et al., 2010), including financial gain.
Scientific method is employed in the study of management and leadership to gain
new knowledge. Two points need to be emphasised here. One is that science and
the scientific method seem to be associated with natural sciences like biology and
mathematics because they test hypotheses and measure observations in a different
way than social sciences. However, the fact that procedures differ from discipline to
discipline does not make social sciences any less of a science than natural sciences.
Neither does the fact that social sciences and especially human relations cannot
be expressed in a mathematical equation or formula make social sciences and
management in particular less scientific. However, it stands to reason that it is
tempting for some people to focus on formulas and equations, as this approach may
appear to be more controllable than phenomena that cannot be expressed in terms of
formulas and equations. In this regard, the excessive concern of management and
leadership with profits and profitability (that is financial gain) to the exclusion of
humans and human relations in the organisation may be explained (see e.g. Heskett
et al., 1994; Kamakura et al., 2002). Second, and more alarming, some researchers in the
management sciences rely largely on personal experience, to the exclusion of more
systematic knowledge, which is contrary to scientific understanding (Rousseau, 2006),
confirming the view of Parker and Ritson (2005) that the susceptibility of the
management discipline to fads and its willingness to accept contradictions that other
scientific disciplines would deem intolerable. This susceptibility of the management
discipline to fads and the seemingly unopposed acceptance of these fads open the
management discipline to scientific criticism. Hence, scholars in the field should be
vigilant in ensuring the scientific rigour of their discipline/field to prevent it from being
perceived as unscientific.
Nevertheless, the organisation as open, social system utilises processes, operated by
people (with their own uniqueness, who interact with one another, and are influenced
by their personal goals, which are not necessarily congruent with those of the
organisation, as well as attitudes arising from the “technical interface”, including their
sense of organisational justice, in the work environment), who have a “will of their
own” (Parker-Follett, 1933/1940), and who are not a submissive resource (Holbeche,
2009) in following the organisation’s goals, which are presumed effective. Hence the
focus of leadership in managing the organisation is on the efficient achievement
of these goals, whether they are in fact effective (i.e. appropriate to the environment in
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which the organisation operates/competes) or not. In achieving the organisation’s
objectives, it is presumed to achieve performance and hence ensuring the long-term
survival and growth of the organisation.
Processes transform inputs to outputs, based on decisions which are generally
informed by selecting the best possible course of action among alternatives, explicitly
or intuitively, in a given situation or context. These decisions may, or may not be, based
on a logical process which is not necessarily linear, and expressed in terms of selected
goals and objectives. These processes furthermore take into account feedback from
the interactions among various components, including the environment (internal and
external) in which the organisation operates. The feedback contributes to continuous
and iterative decisions and actions, which fuel interactions.
This brief summary of the organisation as open, social system shows that the
organisation is a complex system, with a number of simultaneous and continuous
interacting parts, both inside and outside of the organisation, influencing its
performance. Performance is generally expressed in terms of financial gains; however,
the ultimate aim of performance is change, ensuring the survival and growth of the
organisation. Hence it is appropriate to apply complexity science to organisational
management. Accordingly, this paper draws (specifically) on complexity sciences from
an organisational theory perspective.
Conceptual framework
Different labels are used in the literature, whether the natural or social sciences, to
identify complexity science. These include chaos theory, dissipative structures,
complex adaptive systems and non-linear dynamics (Karp and Helgø, 2009). The
interpretation, however, is not unanimous (see Svensson et al., 2008). The literature also
offers a variety of definitions of complexity science, which contain more conflict than
agreement (Wallis, 2009). Despite these discrepancies there are common elements,
presenting the core of complexity science, which is generally accepted, showing the
enduring and useful nature of complexity science (Wallis, 2009).
The core dimensions of complexity science, according to Wallis (2009, p. 310),
are predictability, emergence, fitness, action and strategy. These five dimensions are
interrelated and consequently a change in one dimension causes a change in one or
more of the other dimensions, making it a dynamic system. Given the dynamic nature
of the system, it stands to reason that limits are placed on what leaders and managers
can know about the system (Richardson, 2008). The implication of limited knowledge
is that action and achievement (performance) in a particular, pre-planned way are
restricted. Richardson (2008) maintains that complexity science can provide a means of
overcoming these limitations imposed by the system to a certain degree.
This brief exposition of complexity sciences alludes to the fact that a system
consists of numerous, continuous, linear, non-linear and even random interacting parts.
Furthermore, feedback, which is also non-linear, based on these interactions, requires
(continuous) choice about action to ensure the survival of the system. However, this
action is influenced by the predictability of the resulting outcome of action or actions.
As such it is suggested that the planning of a particular pre-planned/pre-determined
outcome is difficult (Richardson, 2008). The predictability of a pre-determined outcome
is demonstrated by the teleological approaches to complexity science as proposed by
Stacey et al. (2000) and explained by Svensson et al. (2008).
Svensson et al. (2008) focus on three teleological approaches proposed by Stacey
et al. (2000) to illuminate leadership performance in organisational accomplishment.
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These are formative, rationalist and transformative. In essence these three teleological
approaches offer a variety of possibilities about the nature of the future with regard to
the degree of known (accompanied by the influence, or otherwise, of the present and
past). Essentially, the formative approach holds that one has a notion of the future,
which is knowable and predictable, in the present, informed by a given past (extension
of the past). In the case of the rationalist approach the future is also predetermined and
predictable. However, meaning is located in the future, arising from the present, based
on choice and change. The transformative approach holds that the future is unknown
and unpredictable, though meaning is derived from continuous transformations in
the present. These are illustrated in Figure 1.
Managerial framework
Leadership and management, as per Nienaber (2010), consist of a number of interrelated
tasks and activities which are necessary to execute in order to attain (desired/
pre-planned) performance. Leadership, as in the top management of the organisation,
formulates policy or strategy, while middle management is involved in translation of the
strategy and front line managers execute the policy/strategy (Sheldon, 1923/1970) in
an effort to achieve the (pre-planned) goals of the organisation, which is deemed to
be performance.
Past Future
Present
Formative
Rationalist
Transformative
Timeline
Source: Adapted Svensson et al. (2008)
Figure 1.
Conceptual framework
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According to this exegesis, leadership is charged with tasks and activities relating to
the survival and growth of the organisation, which requires an anticipation of
the future. This anticipation in turn influences the direction of the organisation.
According to the teleological approaches discussed above, the future can be known
and predictable or unknown and unpredictable. The teleological approach adopted by
leadership (whether explicitly or intuitively) will influence their stance on the future
(i.e. known or unknown).
Nevertheless, the direction of the organisation is determined by its vision, mission,
goals and strategy to achieve the goals, which ultimately is the long-term survival and
growth of the organisation. To ensure the organisation’s safe arrival at the future
destination, leadership must communicate the direction and ensure that there is a
shared understanding of this direction as well as a unified movement towards it.
This implies that priorities should be clear. Furthermore, leadership should maintain
and improve the wealth-creating capacity of the organisation, which will contribute to
the creation and maintenance of an environment in which employees can perform.
This will depend on the arena where leadership chooses to compete and what constitutes
customer value. Leadership should thus also ensure access to required knowledge, skills,
assets, resources and processes so that value is provided to customers in the chosen arena,
all of which requires information on which they will base their decisions and consequent
actions. The way leadership discharges these tasks and activities is influenced by their
teleological approach – whether they are aware of and acknowledge the approach or not.
Middle managers are charged with the main responsibility of translating the
strategy to ensure action, which entails a number of tasks and activities. Again their
teleological approach influences how they discharge their tasks and responsibilities.
These include communication of the direction and checking for a shared understanding,
as time goes on, as well as mobilising employees to focus their efforts on goal
achievement. These activities include determining what goods and services the
customers desire (with due regard to the arena where the leadership chooses to compete)
and what constitutes organisational performance from both the perspectives of
customers and the organisation.
Therefore, middle management needs to understand the environment in which the
organisation operates (this includes the organisation itself) and to hone the skills of
staff to ensure that they can achieve their potential, in a contracted (not necessarily
from a legal perspective but also a psychological perspective) way that benefits
both employees and the organisation, empowering the employees to discharge their
responsibilities in a productive way. Again all of these activities require information.
Employees implement strategy under the supervision of the front line managers, based
on their understanding and clarification of what is expected of them, which entails
some of the above-mentioned activities. How employees implement strategy will in
turn depend on their teleological approach, whether consciously known to them or not.
With this exposition we contend that most organisations face a more or less known
and predictable future, which is fine-tuned by adjusting to new situations as they
emerge as the future unfolds. Hence, one may conclude that leadership (CEO and top
management) tends to be rationalist in nature – the future is given based on the past,
but as new meaning emerges in the present, the future is correspondingly adapted.
Management tends to be formative in nature as the future is given based on the past
(specifically the strategic planning session which sets the path for the year ahead),
while employees tend to be transformative in nature – every now and again middle
management informs them of the latest decision of top management and the
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accompanying changes that they are expected to effect. (This explanation does not
necessarily take multiple, continuous interaction into account.) Figure 2 summarises
the hierarchical levels and the applicable teleological approach.
Figure 2 is divided into four constituents of organisational performance as follows:
dimension, leadership, management and other staff. These constituents propose a
foundation and framework to understand and describe organisational performance in
five dimensions.
The first dimension addresses the organisational level in focus, whether the
organisational performance is on the strategic, tactical or operative level. The second
one concerns the nature of organisational performance, whether it has an emphasis
that is goal-oriented, predetermined or ad hoc. The third one approaches the
organisational action taking place, whether it is about setting direction, executing
direction or confronting direction. The last dimension encapsulates organisational
decision making, whether it is future-based, past-based or present-based. The final
dimension categorises the previous four dimensions into teleological approaches,
whether their composition is predominantly rationalistic, formative or transformative.
In Figure 2 we provided an analytical framework of organisational performance
incorporating complexity sciences into leadership and management. Specifically, an
attempt was made to reinforce and distinguish the differences between leadership and
management as indicated by Nienaber (2010).
Conceptual analysis
Based on the above conceptual and managerial frameworks of leadership and
management, their roles are depicted according to the teleological approaches to
complexity science, in Table I.
Dimension
Level
Performance
Action
Decsision-
making
Approach Rationalist
===
Future-Based
Set Direction
Goal-Oriented
Strategic Tactical
Pre-determined Ad Hoc
Operative
Other StaffManagement
Execute
Direction
Confront
Direction
Past-Based Present-Based
Formative Transformative
Leadership
Figure 2.
Managerial framework
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According to the information in Table I, the interpretation of the literature seems to be
based on organisations that are inflexible, with a top-down orientation based on linear
interactions. These interactions focus on a strategic level that in turn is forced upon the
tactical and operative levels (see Figure 1).
The bottom-up orientation, as part of interaction as explained in the literature, and
particularly propounded in both systems thinking and complexity science as set out in
this paper, is not reflected in the presentation of leadership and management tasks and
activities in Table I. As such the command and control view of leadership in managing
the organisation is perpetuated. One of the reasons for this situation is ascribed to
leadership’s view of performance, which is generally equated to and expressed in
terms of financial gain. This is the result of the literature favouring indicators of
organisational performance like profitability, shareholder return, environmental
R/L F/M T/O Task
X 1. Assume responsibility for the survival and growth of the business (survival)
X 2. Anticipate the future (foresight)
Set direction
X 3. Provide an organisational vision
X 4. Formulate a mission
X 5. Set goals
X 6. Decide on a strategy
X X 7. Communicate direction, including a shared understanding of the direction
X X 8. Mobilise employees to focus their efforts on goal achievement
X 9. Determine priorities
X 10. Determine what goods and services customers desire, including the price they
are willing to pay
Determine organisational performance in terms of
X 11. Organisational view (f¼{ability, motivation, opportunity})
X 12. Customer view (f¼{opinion of value obtained})
X 13. Understanding the environment in which the business operates
(macro, market, micro)
X X 14. Maintaining and improving the wealth-creating capacity of the business
Maintain an information base to
X X 15. Establish needs
X X 16. Gather and evaluate information
X X 17. Use information
Create and maintain an environment in which employees can perform by
X X X 18. Honing their abilities to ensure that they can achieve their full potential
X X X 19. Contracting with workers in a way that is advantageous to both them and
the firm
X X X 20. Empowering employees so that they can discharge their responsibilities
effectively
X X 21. Considering the emotions of staff, which contributes to building trust
X X 22. Selecting a competitive arena to compete
X X 23. Determining what constitutes customer value
X X 24. Ensuring access to required knowledge, skills, assets, resources and
processes so that value is provided to customers in the chosen arena
X X 25. Ensuring adherence to the principles of productivity in accomplishing the
goals of the business
18 18 6 Sum
Source: Adapted Nienaber (2010)
Tabl e I.
Typical classification of
leadership and
management task and
activities according to the
teleological approaches
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survival and social responsibility, while neglecting the role of employees in the
performance or survival of the organisation (Ghoshal, 2005; Pfeffer, 2010).
Leadership’s concern with the indicators of performance like profitability and
shareholder return is attributed to the ideology of the supremacy of markets
and shareholder interests as well as the associated idea that market outcomes are fair
and just, with sentient individuals making informed choices (Pfeffer, 2010) in the best
interest of the organisation’s survival. As such, the idea that the organisation primarily
exists with a view of maximising profitability is adopted (see Friedman in Ghoshal,
2005, p. 79) at the expense of the contribution of other, equally important, contributors
like employees and customers (Heskett et al., 1994; Kamakura et al., 2002; Svensson
and Wood, 2005).
We argue that the literature and research in the field need to focus more on the
rationalist and even transformative approach to leadership and management. It is
perhaps not so easy to illustrate such an approach elegantly, because interaction takes
place among numerous parts that are linear, non-linear and even random. We would
like to suggest a more comprehensive account of leadership and management tasks
and activities than that provided in Figure 1, which would better prepare leadership
and management for sudden and unexpected changes in the market and society, like
those in 1998 in South-East Asia and 2007/2008 in the USA and Europe (even earlier
situations like the Enron debacle).
Our proposal, based on complexity science, is illustrated in Table II. In terms of the
information in Table II we expand the allocation of responsibilities to show that
although a specific layer of management may be ultimately charged with a the
responsibility of a task or activity, it may also provide an input to a task or activity at a
different hierarchical level and even a joint responsibility, hence we show this as an
“added responsibility”.
Table II shows shared and overlapping responsibilities, indicating the interaction
among the different role players and layers of the management/leadership hierarchy in
the organisation. For the sake of order one of these positions needs to assume ultimate
responsibility for a specific task and activity. However, ultimate responsibility does not
preclude participation from any other hierarchical layer, nor the acceptance of input
provided by role players. The illustration in Table II does not reflect these interactions,
as it is not possible to do so in a complete or eloquent fashion, but merely shows
ultimate responsibilities, shared responsibilities and inputs to other responsibilities.
However, it contrasts with the view that neglects the role of employees in organisational
performance, and echoes the sentiments of Owen (1813/1970) who lamented the neglect
of human resources in favour of machines, as well as those of Ghoshal (2005) and Pfeffer
(2010) regarding employees’ contribution to organisational performance and the
subsequent survival of the organisation.
In applying complexity science to the tasks/activities of the different layers of
the management/leadership hierarchy in the organisation, a pluralistic approach is
supported that synthesises a variety of perspectives, including a bottom-up approach
to problem solving, in which the knowledge and experience of employees are taken into
consideration to ensure organisational performance. In this way the application of
complexity science gives effect to transformational leadership as advocated by authors
such as Burns (1978) and Bass (1985). According to these authors transformational
leadership creates significant changes in the life of people and organisations alike.
Transformational leadership connects employees to the vision, mission and goals of
the organisation and inspires them to contribute to goal achievement by doing
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meaningful work, including challenging the status quo. Hence the expectation is
created that the contribution of the employees, including managers at lower
hierarchical levels than the leadership cadre, counts in the pursuit of organisational
performance. True transformational leaders will thus not over-claim success for
organisational performance, but will rather commend their managers and staff for
their contribution to the organisational performance.
This view has implications for modern-day organisations in terms of culture,
structure, processes and systems, as well as for the school of management thought
implicitly or explicitly adopted, the ideology of leadership and their assumptions, to
mention a few. In the same breath we would like caution against the nature of the
management discipline as mentioned previously, which is susceptible to fads and a
R/L F/M T/O Task
Xþ|1. Assume responsibility for the survival and growth of the business
(survival)
X||2. Anticipate the future (foresight)
Set direction
X||3. Provide an organisational vision
X||4. Formulate a mission
X||5. Set goals
X||6. Decide on a strategy
XXþ7. Communicate direction, including a shared understanding of the direction
XX|8. Mobilise employees to focus their efforts on goal achievement
X||9. Determine priorities
|Xþ10. Determine what goods and services customers desire, including the price
they are willing to pay
Determine organisational performance in terms of
þX|11. Organisational view (f¼{ability, motivation, opportunity})
|X|12. Customer view (f¼{opinion of value obtained})
þX|13. Understanding the environment in which the business operates
(macro, market, micro)
XXþ14. Maintaining and improving the wealth-creating capacity of the business
Maintain an information base to
|X X 15. Establish needs
|X X 16. Gather and evaluate information
XXþ17. Use information
Create and maintain an environment in which employees can perform by
X X X 18. Honing their abilities to ensure that they can achieve their full potential
X X X 19. Contracting with workers in a way that is advantageous to both them and
the firm
X X X 20. Empowering employees so that they can discharge their responsibilities
effectively
XXþ21. Considering the emotions of staff, which contributes to building trust
XX|22. Selecting a competitive arena to compete
XX|23. Determining what constitutes customer value
XX|24. Ensuring access to required knowledge, skills, assets, resources and
processes so that value is provided to customers in the chosen arena
|X X 25. Ensuring adherence to the principles of productivity in accomplishing
the goals of the business
25 25 25 Sum
Notes: X, traditional (ultimate responsibility); þ, added responsibility; |, input
Table II.
Classification of
leadership and
management task and
activities according to the
teleological approaches
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willingness to accept contradictions that other disciplines would not tolerate
(Parker and Ritson, 2005) on which leaders and managers rely in contemporary times
(Rousseau, 2006).
Implications and lessons learned
Leadership (CEO and top management of the organisation) is ultimately charged
with the responsibility of organisational performance. Organisational performance
is broader in scope than merely profitability and shareholder returns. As pointed out,
the ultimate aim of organisational performance is change, ensuring the long-term
survival and growth of the organisation. The direct influence of leadership on
organisational performance is not clear from the literature.
A number of actors are involved in organisational performance, from leadership
who sets the direction to management that translates the direction, and employees
that execute strategy. A number of multi-faceted factors influence the performance
of the organisation, which makes it difficult to determine the exact contribution of each
role player and factor to organisational performance.
The presentation and interpretation of the literature in this regard seems to
attach an inflated role to leadership in achieving organisational performance. This is
attributed to a top-down approach to management, portraying a command and control
approach as superior to a bottom-up approach, safeguarding the performance of the
organisation. The contribution of employees and other factors are discounted in this
view. Furthermore, this view presents leadership as overly simplistic, ignoring the fact
that the organisation is an open, social system, operating in a dynamic environment.
The interactions among the parts of the system may take various forms: linear,
non-linear and even random, at times imposing limitations on knowing and/or
predicting the future accurately. Hence leadership is not in a position to know or
predict the future accurately and consequently limits are placed on what can be
achieved in a pre-planned/pre-determined way.
Since complexity science deals with complex systems and it can be used to aid
leadership decisions and actions as the future unfolds in securing organisational
performance, based on a pluralistic approach. The purpose of this paper was to explore
leadership’s contribution to organisational performance by linking their tasks and
activities at the different hierarchical levels of the organisation in terms of three
teleological approaches to complexity science.
In essence, complexity science holds that there are limits to what can be known
with a consequent limit on what can be achieved in a pre-determined or planned
way. Nevertheless, it is not impossible to overcome these limitations to secure the
organisation’s survival. The degree to which these limitations are overcome depends
on the view that leadership takes on management, i.e. an integrated approach or
favouring a specific school of thought, for example, the systems or contingency or any
other approach to management as well as their ideology and assumptions.
An organisation consists of numerous, continuously interacting parts within and
outside the organisation, generating feedback, which requires action (and fuelling the
interactions). The action is influenced by the predictability of the resultant outcome of
the action, which can be known or unknown, based on the present and past, according
to the formative, rationalist and transformative teleological approaches to complexity
science. In the case of the formative approach, the future is known and predictable, in
the present, it is based on the past (linear relationship). The rationalist approach also
holds that the future is known and predictable; however, meaning arises in the future,
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arising from the present (linear and non-linear). The transformative approach holds
that the future is unknown and unpredictable and meaning is derived from continuous
transformations in the present (non-linear, but can also be random).
Leadership consists of a number of tasks and activities, the ultimate responsibility
of which rests with different hierarchical levels in the organisation. However,
the different role players may have an overlapping involvement and responsibility in
executing these tasks and activities or at least an input in carrying out these tasks
and activities, as suggested in this paper. Accounting for all role players and their
contribution (however marginal) presents management of the organisation more
accurately, and the bottom-up approach is credited for. This approach obliges
leadership to consider their approach to choice and action explicitly, rather than
acting “unconsciously” without realising the full implications of their choice and the
consequences, especially unintended. Being aware of choices, i.e. to involve employees
and the extent of their involvement, may cause leadership to reappraise their own role
in organisational performance and the accompanying rewards claimed. In this way
complexity science can inform better leadership decisions and actions in managing the
organisation, moving away from the linear, simplistic view to a non-linear, possibly
random, pluralistic view in securing the long-term survival of the organisation.
It is recommended that the problem of leadership and their link to organisational
performance be studied from the view of human behaviour, whether from a socio-
psychological or stewardship perspective, which attends to people and their behaviour
in specific situations.
Concluding thoughts
This paper contributes to both theory and practice by using an alternative presentation
of managing organisations to achieve performance, which endeavours to reflect the
complexity of organisations and takes into account a pluralistic approach that
synthesises a variety of perspectives. This includes taking a bottom-up approach to
problem solving, in which the knowledge and experience of employees are taken into
consideration to ensure organisational performance.
The contribution for both theory and practice includes inter alia that we need
to think differently about managing organisations without falling prey to fads.
This would entail how we present and reflect on information that appears to be “linear”
although it is not necessarily the case, making deliberately explicit our assumptions,
ideologies and philosophies, and considering unintended consequences of our decisions
and actions emanating from these assumptions, ideologies and philosophies.
The “human nature” of the organisation should also be reconsidered.
We believe that the conceptual and managerial frameworks that have been
introduced will enhance the understanding of management and leadership among
scholars and practitioners and that it will contribute to a better understanding of
management and leadership and how they complement each other. Nevertheless, there
are a few limitations to be acknowledged. First, whenever involving complexity in
conceptual and managerial frameworks it is challenging to substantiate the framework
empirically. Second, since we use teleological approaches of complexity science in a
new way in this paper, they need to be validated in a broader context.
The highlighted limitations offer opportunities for further research as well as
improved practices in business. It would be interesting though challenging to explore
complexity empirically in examining leadership’s contribution to organisational
performance.
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... Performance Organizational performance has received significant attention in the literature (Al Khajeh, 2018;Al-Khaled & Fenn, 2020;Almatrooshi et al., 2016;Hariswaran et al., 2020;Lasater et al., 2019;Nienaber & Svensson, 2013;Reis Neto et al., 2012) consistent with the complexity of the concept of performance. Organizational performance is proportional to the economic performance it produces (Drucker, 1955) and is expressed as financial gain. ...
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