Leading by decisions

In today’s times of significant economic and political instability, people often call for leadership but they rarely stop to think about where leadership should really be expressed, namely in decision-making.

In their article called ‘A Leader’s Framework for Decision Making’, published in Harvard Business Review in 2007, David Snowden and Mary Boone wrote that different circumstances demand different types of reactions. In a simple context, cause and effect are clear for everyone – and therefore so too is the response.

A complicated context can contain multiple right answers, and although there is a clear relationship between cause and effect not everyone can see it. Leaders have to sense, analyse and ultimately make a decision.

In a complex context, which is where most companies find themselves right now, it is extremely difficult to find the right answers. Leaders have to first probe and gain information, then sense and then make a decision.

In a chaotic context, it is pointless to try to find the right answer. Here, a leader first has to take action to restore order, then ascertain where stability is present and finally transform the situation into a complex context.

Ten years ago, the leadership coach Marshall Goldsmith helped Ford boss Alan Mullaly with the car manufacturer’s spectacular turnaround when the company was on the verge of bankruptcy. Goldsmith created a culture of openness among the senior managers at Ford who then dared to admit that they had no idea where to start. According to Goldsmith, many CEOs make the mistake of speaking before they know the answers themselves and their half-baked suggestions always come across as orders.

Napoleon was a great (supply chain) leader. For his time, he was very accessible and listened both to his generals and his foot soldiers. During the Russian campaign in 1812, in a flash of megalomania and against the advice of his generals, he decided to march on Moscow. He thought he was dealing with a complicated yet familiar supply chain. Instead, Russia turned out to be unexpectedly complex. That decision resulted in the total destruction of the Grande Armeé and ultimately led to emperor Napoleon’s downfall.

True leaders are able to accurately assess both the supply chain and the context and use their findings as the basis for making the right decisions.

Martijn Lofvers
Publishing director & chief editor