BITS Pilani

Pilani Campus

Leadership and Management of Change

Sidharth Mishra
Lecture –17
Leadership and ethics

• Effective leaders reflect over ethical questions.

• Effective Leaders understand that the power vested with them must be used in
ethical manner.
• They live temperate and balanced lives.
• They acknowledge the existence of fear in workplace. They acknowledge it,
confront it, and refrain from fear based tactics to conceal the fears they face.
• They are prepared to make difficult decisions.
• Through communication and collaboration they invite others to participate in
confronting the truth.
Questions of Ethics

• How should we live?

• How should we treat others?
• What sort of choices result in well-beings?
• What is justice?
Ethical Leadership

• Self awareness and reflection

• Humility and Acceptance
• Power with responsibility
• Focus on personal power (the power one earns through one’s knowledge, skill,
capabilities).
• Face unpleasant realities
• Be unconstrained by group norms.
• Know one’s limitations
• Strive to live a principled life
 Group Morality Niebuhr’s observation

• Individuals have qualities of sympathy and consideration. They have sense of

justice and objectivity even when their self interest is involved. In a group setting
there are less avenues to guide and check impulses, low capacity of self-
transcendence and less ability to comprehend the needs of others.
• In a group setting the individual is taken over by the collective egoism of the
group.
• In professional life, personal values are mediated by other forces inside the
organisation structure.
• The larger the group the more difficult it is to achieve group self consciousness.
• Organisations interact with each other at a political level.
• Conflict, a seemingly unavoidable prerequisite for group solidarity and the pre-
occupation with the gain or surrender or power turns a group of moral individual
into an unruly mob.
Group Morality

• Every man is, in a certain sense, unconsciously a worse man when he is in society
than when acting alone. Any large company of wholly admirable person has the
morality and intelligence of an unwieldy, stupid and violent animal. The bigger the
organisation, the more unavoidable is its immorality and blind stupidity.
• In many business organizations any one who dared challenge superiors or
deviated from group norms would suffer group alienation – sometimes loss of job.
• This often leads to a collusion of silence.

• Effective Leaders understand the pressure of group on the individual.

• Effective Leaders collaborate with group members to help break moral
bottlenecks.
• Effective leaders possess the courage (and the equity) to challenge group norms.
Personal Exercise

• Have you ever made a decision based on what the group expected of you rather
than what you would have preferred to do?
• Do you ever encourage a group you participate into challenging its group norms?
• Have you ever supported any one else who has challenge group norms?
• When do you think group norms serve a constructive purpose?
Corruption within organization
• The CEO of a major bank was recently charged with corruption.
• Corruption usually happens due to collusion. One or a group of individuals benefit
through dishonesty, deceit, theft or manipulation.
• The following factors within the organization increase the chances of corruption
within.
• Self Obsessed (narcissistic) leadership.
• Weak Leaders surrounded by sycophants.
• Excessively competitive organizational culture.
• Culture resistant to change.
• Culture that promotes elitism and entitlement.
• System that lack transparency.
• Reward system that emphasize achievement of results at any cost.
• Excessive Bureaucratic controls.
• A culture based on non-accountability.
• A fear based culture.
System Leadership and strategy

• Developing an organization’s strategy and executing it are the primary tasks of

senior management.
• Strategy is the organization’s game plan to stay relevant.
• Executed through innovation, product/market strategies, resources allocation
plan
• Strategy includes the organization’s plan for transformation and learning.
• Effective leadership recognizes that strategic leadership lies in networked growth
(suppliers, channel partners, associates (employees, allied companies like
logistics company and customer ) rather than individual success.
• Planning for different scenarios helps make flexible and creative strategies.
Adaptation and the learning organization

• Real change is adaptive and transformative.

• Adaptive change is one without the emotional baggage of the past.
• A typist unable to move beyond his typewriter and upgrade to a PC.
• A company that failed to upgrade to quartz watches / smart phones
• When an organization is coping with new realities, it too must look at what it
stands for, the values being challenged and the new attitudes and behaviour
required to respond to new market needs.
• Leadership involves dealing with the individual and group dynamics challenges
which emerge from the emotional challenges of change.
• Learning means seeing things differently by developing new insights and mind
sets.
• Learning opens up new vistas of consciousness that allow for new insights.
Leadership and Learning

• Effective leaders stimulate the learning process.

• Organizations need to build learning into their strategies by encouraging
innovation and creativity of feedback loop. (Plan-Do-Check-Act).

• Learning Blocks
• Inability to face new reality.
• Excessive Fear discourages learning.
• A reward system that focuses on performance rather than creativity.
• Overemphasis on execution.
• A punitive system for risk takers.
• Mental models that emphasize entrenched methods of problem solving.
• A culture that does not encourage fun at work.
Distributed market leadership

• A firm holds market leadership in association with its partners (suppliers,

customers).
• A laser focus on customer needs is critical for organisational relevance.
• Business models should be continuously adjusted to ensure financial
sustainability.
• Disassembly and the synergy of network
• Products are dissembled into small units which are then assembled at places
where they can be done in the most efficient manner.
• This calls for management of an elaborate network of manufacturers and
assemblers.
The Value Chain

supplier1

Supplier2 manufacturer distributor dealer customer

Supplier3
Strategic Leadership Leadership and strategy

• A strategy is a pattern or plan that integrates an organization’s major goals,

policies and action sequences into a cohesive whole. A well formulated strategy
helps marshal and allocate an organization’s resources into a unique and viable
posture based on its internal competencies and shortcomings, anticipated
changes in the environment and contingent moves by intelligent opponents.
• Change Strategy Leader and learning
• Effective leaders create conditions for learning within the organization. They
stimulate learning by making it an enjoyable process.
• Good leaders are designers (who plan strategies), teachers (who help their
followers to learn new skills) and stewards (who exercise seva leadership).
Good Change and Bad Change

• Good Change responds to new realities. Like a good exercise it helps build
organizational stamina and makes it stronger to confront change in the future.
• Bad Change is energy sapping. It takes the organisation away from the emerging
realities. Like junk food, it debilitates the organization.
Strategy Development Process

• Old method
• Make plans and hope the future would follow.

• New Method
• Recognition of reality through a network of relationships.
• All components of this network are in states of motion.
• Power distribution across the network is continually changing.
• Linear cause and effect relationship was not properly identified.

• Scenario Planning
Scenario Planning

• Scenario Planning is about constructing stories about the future from the data
available from the past and the present. The stories should inspire all
stakeholders.
• It incorporates the systemic issues interlinking systems.
• The scenario should exude motion.
Scenario Planning An Example

• The cost of solar power has dramatically gone down. During the next decade it is
expected to fall to Rs. 1.90 per kwh, At the same time the cost of coal based
power is expected to rise to close to Rs. 4.9 per kwh.
• The Sun would power the future. Solar power would change the way we live. Cars
would run on batteries as would Air conditioners. The hotter the day, the faster the
AC would operate driving the heat out of our homes. Much like the railway tracks,
the roads will get electrified and cars will move over non-static roads which, like
giant conveyor belts would carry them to their destinations.
• This would lead to a cleaner environment. This would also change the geopolitical
equation in the world.
Scenario Planning

• It invites curiosity and imagination.

• It helps reframe same issues from different perspectives.
• Helps predict complex future environments.
• It addresses the ambiguities inherent in the shaping of new realities unlike
quantitative techniques.
• Provides multiple perspectives.
• It encourages inductive thinking. Inductive thinking starts with a specific
observation and generalizes. It may not always be correct but it opens up
interesting possibilities.
• Scenario Planning helps one to move from the present to the future and move
backwards.
Scenarios and Formal Planning

• Make normal plans. Use the scenarios as ‘flag posts’ for possible alterations or
contingency plans.
• Study the product, market implications for each scenario. Choose the most likely
scenario to form the basis of the planning process. Other scenarios are used for
later day adjustments.
• Develop multiple plans.
Overall tasks of system leadership
• Identify new realities
• Identify the adaptive challenge.
• Orient stakeholder groups to deal with value tensions.
• Identify who has what to gain and what to give up or lose.
• Recognize signals of distress.
• Distinguish between the group/organization’s adaptive and technical work.
• Provide a holding environment or container for distress.
• Make conservative interventions to keep people on track.
• Get on the balcony to gain new perspectives.
• Delegate properly.
• Form alliances across group factions and constituencies.
• Mobilize resources.