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 / First Quarter 2002 / Issue 26(originally published by Booz & Company)


The Human(e) Factor: Nurturing a Leadership Culture

What really matters is the quality and consistency of the thinking that goes into the creation of lasting values. The lasting influence of any manager, successful or flawed, in large part is a reflection of how much the humane factor influences his or her perspective and how steadily that perspective is maintained.

Seven Steps to Human(e) Leadership

Deutsche Bank’s Alfred Herrhausen once observed, “In the end, all problems of the economy are staff problems.” The lesson is true today, and so is its inverse: Enterprises can best compete in this global environment if they have flexible, highly motivated employees. Humaneness is the master key to coping with almost any entrepreneurial challenge, since most of them result from the way people are treated in the enterprise.

Although performance — both professional and personal — must be at the center of all personnel-related strategic measures, new business models call for a new strategic role for human resources departments: investing in people, not just filling job openings. For those companies that want to meet the challenges of the humane factor, there are seven fundamental qualities to consider:

1. Entrepreneurial action must be based on a clear, simple system of values. These values must be lived, creating loyalty in a new form. The continuity of shared cultural values will become more important to companies because continuity is no longer ensured by the long-term tenure of a CEO.

2. Being a model requires consistency in thinking and acting as well as encouraging and promoting followers. The development of a consistent culture of customer orientation throughout the organization is crucial for survival. Social competence comes most naturally to entrepreneur personalities with character, education, and broad-based life knowledge.

3. The consistent culture of customer orientation starts with the CEO and reaches down to each and every trainee.

4. With the right kind of leadership, the technology-driven enterprise transforms itself into a market- and people-oriented enterprise.

5. Companies must invest in people, in their skills, and in their knowledge. They must not only put the right people into proper positions, but also support initiatives that encourage personal and professional growth.

6. Successful management with a high degree of responsibility on all decision-making levels requires openness. Only with openness will change be understood, accepted, and actively driven.

7. Creativity flourishes only in freedom. Managers must grant the people within the enterprise free space for creativity, originality, and risk taking (e.g., in cross-hierarchy project teams).

Willingness to change may not be restricted to the top management and the second executive level; it must permeate all employees. This culture evolves when the people in the enterprise are perceived, respected, and promoted in their own identity, creativity, and originality. To that end, all enterprises should reevaluate their people as bearers of knowledge, sources of creativity, and propellers of change.

— R.W.H.

This article is adapted from Faktor Menschlichkeit [The People Sector], by Rolf W. Habbel (Wirtschaftsverlag Carl Ueberreuter, 2001). An English version of the book is scheduled to be published by Palgrave Macmillan in 2002.

Reprint No. 02108

Rolf W. Habbel, [email protected]
Rolf W. Habbel is a member of Booz Allen Hamilton’s board of directors. A vice president with the firm in Munich, he specializes in worldwide market strategies, innovative business strategies, and efficiency programs in the telecommunications and information industry.
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  1. James M. Citrin and Thomas J. Neff, “Digital Leadership,” s+b, First Quarter 2000; Click here.
  2. Bruce A. Pasternack, “Leadership: Dreamers with Deadlines,” s+b, Fourth Quarter 2001; Click here.
  3. Bruce A. Pasternack, Thomas D. Williams, and Paul F. Anderson, “Beyond the Cult of the CEO: Building Institutional Leadership,” s+b, First Quarter 2001; Click here.
  4. James O’Toole, Leading Change: Overcoming the Ideology of Comfort and the Tyranny of Custom (Jossey-Bass Inc. Publishers, 1995)
  5. Bruce A. Pasternack and Albert J. Viscio, The Centerless Corporation: A New Model for Transforming Your Organization for Growth and Profit (Simon & Schuster, 1998)
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