Learning About Leadership
by William Q. Judge

What Is Leadership?
While many people equate “management” with “leadership,” I see these two terms as both complementary skill sets and competing value orientations that help to explain a lot of organizational outcomes (both good and bad). Management is derived from the Latin word manus, meaning, “hand.” In contrast, leadership is derived from the Latin word laedere, which roughly translates as “to show the way.” In other words, management is about the efficient gathering and handling of resources within an existing order; while leadership has to do with bringing about effective change to a new order.

Since organizational efficiency is relatively easy to observe and measure and organizational change is relatively messy and unpredictable, most organizations emphasize management over leadership. As a result, individuals with management talent and skill are often attracted to and promoted within established organizations, while those with leadership talent and skill are often repelled from and/or overlooked within control- and efficiency-minded organizations.

This emphasis on management worked fine in the past when technological change was relatively predictable and competition was mostly domestic in nature. However, new technologies encourage rapid transformation of entire industries, and competition is increasingly global. As a result, many organizations need to make dramatic change, and that is where leadership comes in.

A Need For Leadership Skills And Character
To be an effective leader, one needs a certain set of skills, such as an ability to create and share an inspiring vision with others or the talent to challenge the existing order of things, so as to encourage followers to adapt and pursue purposeful change. These competencies are relatively rare within today’s organizations and are critical to organizational survival and success. However, an equally important and necessary element in leadership effectiveness is the leader’s personal character. Because charismatic psychopaths, such as Adolf Hitler, are certainly adept in gaining followers, we must also look at issues such as character and integrity when considering what makes a leader. I especially like the analogy that a person’s character is like a teabag: you don’t know what a person is made of until placed in hot water. Of course, both aspects of leadership are important, but we know so much less about leadership character than leadership competencies, and that is where I have concentrated much of my leadership research.

Ultimately, leadership is also relational. In other words, leaders never lead unless there are followers who voluntarily agree to follow them. Therefore, trust by the followers of a particular leader is essential. I might trust you if I think that you are intelligent and have some good ideas, but I might not commit to your path unless I think that you are a trustworthy person who will consider my well-being and that of others if I follow. In sum, character defines who we are and communicates to others whether we are just in this game of life for ourselves, or whether we have a larger perspective.

In my book, titled “The Leader’s Shadow: Exploring and Developing Executive Character,” I studied a wide range of chief executive officers (CEOs) within various business organizations to better understand their character and the effects of their personal character traits on the overall organization. I argued that their characters were formed by the confluence of three internal personal qualities – personality, values and spirituality. Based on a broad national survey of CEOs complemented by in-depth case studies of six CEOs, this book explored the leaders’ roles and impacts on their organizations. Effective leaders were trusted, providing a source of competitive advantage in the marketplace. Given the common public perception of “me first” leaders, it is interesting that many CEOs drew deeply from their religious and spiritual traditions to make decisions and lead. For example, the first thing that one CEO of a highly successful mid-sized bank would do each day is get down on his knees and ask God if he should continue being a CEO or leave business and enter the ministry. Similarly, another CEO relied heavily on his understanding of Christian forgiveness to accept the role of CEO from a group of directors that had unfairly fired him months before. I also found that CEOs are eager to talk privately about the relationship between spirituality and character and leadership, but aren’t sure how to deal with this relationship publicly for fear of alienating their workforce and/or causing subordinates to insincerely imitate the boss’s professed faith.

But trustworthy leadership clearly doesn’t explain everything when it comes to controllable factors within an organization. In another research study, I found that strategic alliances that were created by trustworthy leaders, coupled with clear contractual expectations, performed better than just the presence of trustworthy leaders or a well-designed legal contract. Furthermore, my research shows that trustworthy leaders with good character and skills sometime inherit impossible situations where the organization is in an irreversible decline. As such, effective leadership is necessary but not sufficient for organizational effectiveness. Despite this fact, most leaders (as well as managers) are given too much credit when things are going well and too much blame when things are not going well, what some scholars call “the romance of leadership.”

Leadership In Different Cultures
In subsequent research, I sought to understand how the character of American CEOs compared and contrasted with the character traits of Taiwanese CEOs. The United States is a highly individualistic nation with deep Christian roots. Taiwan is a relatively collectivistic nation with Confucian roots. I found that character traits were quite similar on some dimensions and dissimilar on others. Specifically, both sets of CEOs gave priority to logic for making decisions as opposed to concern about how their decisions would affect other people. By way of example, most CEOs would close down a plant if it were a logical business decision, regardless of the consequences to the people employed within the plant. However, the American CEOs were much more abstract and intuitive in their data collection process, while the Taiwanese CEOs were much more practical and detail-oriented. For example, the American CEOs were more comfortable making big decisions based on relatively small amounts of data by relying on their “gut”; the Taiwanese CEOs generally required lots of detail surrounding the strategic issue before coming to a conclusion about what must be done.

Similarly, both groups of CEOs claimed to value “honesty” above all else. This suggests that open and honest relationships are a key requirement for any successful CEO. However, American CEOs valued “self-respect” and “an exciting life” much more than their Taiwanese counterparts did, which suggests that American executives are much more focused on individualistic values. In contrast, Taiwanese CEOs valued “wisdom” and “helpfulness to others” more than their American counterparts, and this implies that being perceived as wise and helpful is more important to executives in Taiwan. In sum, my research suggests there are some character traits that are universal to the role of CEO, and there are many other traits that are specific to the national social culture.

Leadership In The Boardroom
Leadership, however, is not limited to executives who serve in a formal leadership role within an organization. Independent directors serving on the board are increasingly called to “lead” organizations by providing objective advice to management, evaluating and monitoring management’s plans and activities, and helping to select future managers and leaders of the organization. In my research on boards, I have found that directors in nonprofit organizations are often much more involved, and hence provide better leadership, than directors in for-profit firms due to the greater probability of the directors’ alignment with the organizational mission in nonprofits. Having served as a director within a large health system for nearly a decade, I have seen firsthand just how dedicated volunteer directors can be in nonprofit organizations. In addition, I have found that directors with leadership character and skill can sometimes compensate for the weak institutional conditions in emerging countries, such as Russia where I served as a U.S. Fulbright scholar in 2001. Furthermore, in a research project funded by the National Science Foundation, I found that leaders created “goal-directed communities of innovation” while managers tried to manipulate scientists and technicians into being more creative within the biotechnology industry. For example, one highly creative and innovative biotechnology firm avoided selecting the best and brightest research scientists from the most prominent universities because it found that “prima donnas don’t collaborate well.” Alternatively, one struggling biotech firm relied heavily on stock options to motivate research scientists, even though these options did little to spur their creativity and work ethic.

Faith And Leadership
In my current research, I am exploring the relationship between an entrepreneurial leader’s faith and his or her approach to launching a new business from scratch. Much of the entrepreneurship literature talks about launching a new business as an act of faith, but no studies to my knowledge have systematically explored how the religious and spiritual tradition of an entrepreneur affects, or is affected by, a start-up business. To learn more about this relationship, I interviewed four individuals each month as they were in the process of launching a new business in 2006. There were two women and two men in my sample because previous research suggests that men and women differ in their approach to matters of faith, as well as their approach to entrepreneurship. Indeed, I am finding some fascinating differences between men and women, as well as between those with a more traditional “churched” approach to faith and those with a less traditional “unchurched” approach. I hope to analyze this data more thoroughly and publish my findings in 2008.

Leadership has been studied from many angles in the social sciences, and the literature is vast. For example, if one were to do a search on all studies that address the topic of “leadership” in the ABI/Inform database, the search would turn up more than 194,000 articles published over the past 30 years! Despite this fact, there is much yet to learn about the nature and effectiveness of leadership in new and established organizations. The seemingly intractable problems of balancing economic growth with environmental stewardship, striving to be both innovative and efficient, and the need to be globally competitive while being locally responsive, show that there is a dearth of leadership talent, for the “mess we are in” cannot be mitigated except by new and creative thinking and behaviors by current and potential leaders. The challenge will require the commitment of many in academic and in organizational life.