Friday, April 11, 2008


It was in a rare moment of emotional disclosure, that one of my colleagues, who has always looked up to me for guidance, confessed sheepishly that the biggest issue in his life right now was that his wife was too dominating. “She doesn’t let me decide anything,” he groaned. I, the CEO trainer, gloatingly chided him that a man ALWAYS should be authoritative with his wife. “Shout, and she’ll follow your orders buddy,” I sniggered away at him. Interestingly, my team’s research proved that a similar situation exists in companies too!

In a 2006 Harvard Business School case paper, titled Harley’s Leadership U-Turn, Rich Teerlink (ex-CEO of Harley-Davidson), while explaining how his organisation took a U-turn from near extinction, concluded, “When an organisation is under extreme pressure — so much so, that one wrong move can mean its collapse — authoritarian leadership may very well be necessary.” So which, according to you, is the best form of leadership in a competitive business environment? In a comprehensive paper titled Is Servant Leadership Part of Your Worldview?, Dr. J. Howard Baker, Professor, University of Louisiana, argues, “An authoritarian, command and control model of leadership may be very effective for stopping something, destroying something, or conquering something...” Having said this, he rightfully praises John F. “Jack Neutron” Welch, the authoritarian ex-Chairman of GE, who is undoubtedly one of the most highly regarded leaders in the business world today. Welch once said, “Management is looking reality straight in the eye and then acting upon it with as much speed as you can...” Undoubtedly, he was a staunch believer of authoritarian leadership style.

Then there is the common myth of authoritarian leadership style being inversely related to shareholder returns. In his most smashing work, The Affinity of Foreign Investors for Authoritarian Regimes, Prof. John R. Oneal of the University of Alabama, countered that “(shareholder) rates of return have been greater under authoritarian regimes.” Yale University’s Prof. Samuel Huntington’s paper Political Order in Changing Societies further concluded, “Authoritarian regimes are more capable of rational, consistent, and responsible decision making than democratic ones, and a participatory democracy affords special interest groups the power to block, delay or hinder changes that might be beneficial to the economic growth of the entire society.” Interestingly, in 1993, a World Bank study titled The East Asian Miracle endorsed the authoritarian regimes in the region by putting forward the argument that “the ‘Asian Way’ was rightly untrammelled by excessive concern with individual rights.”

Clearly, there have been instances where leaders with their authoritarian style of leadership have given to the world what they hold in awe and pride. One such glorious example can be found in Andrew Keen’s best-seller titled The cult of the amateur where he writes, “There’s not an ounce of democracy at Apple. That’s what makes it a paragon of such traditional corporate values as top-down leadership, sharply hierarchical organisation and centralised control. Without Steve Jobs’ authoritarian leadership, Apple would be just another Silicon Valley outfit run by mind numbingly conventional Stanford MBAer’s. We’d have no iPod, no iTV, no iPhone, no iTunes.” Another book by J. Fentster titled In the words of Great Business Leaders, states how John. D. Rockfeller (founder of the great Standard Oil Company) “saw his relationship with them (employees) as transactional. He led, operating in a directive, autocratic way.” The book also talks of other such leaders like Thomas Watson (IBM), Andrew Carnegie (Carnegie Steel), Ted Turner (CNN), David Packard Henry Ford I and II (Ford Motors) & Sam Walton (Wal-Mart), who have made their mark in the corporate world. Just as Peter Drucker said, “The leader of the past was a person who knew how to TELL. The leader of the future will be a person who knows how to ASK.”

Critically, in today’s world, using authority over intellectuals (like in R&D) or over young dynamic leaders would surely backfire. But when an organisation, or a nation, in general has massive potential waiting to be exploited, a CEO has to necessarily use a killing yet passion-building authoritative leadership, if the organisation has to be world-class one day soon! Having said all that, my less-than-convinced colleague still promised to test out the theory on his wife. I told him even I’ll start putting more authority on my wife. I’m happy to inform you that post our testing this on our respective wives, both my colleague and I have become much closer these days. I was thrown out of my room and these days sleep in the guest house. My colleague too has temporarily shifted in with me...


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