Management

Right leader must be open to challenges

By You Nuo and Yang Ning (China Daily)
Updated: 2010-08-04 16:38

Environment for creating global managers should feature diverse cultures, intellectual demands

BEIJING - Leaders may be born. But more often than not, leadership is made. And to turn leadership in the globalization era into something like a social asset, people - not just the would-be future leaders - should build a healthy environment to let it grow and flourish.

Frank Brown, dean of INSEAD, said a lesson from the global crisis is that chief executive officers "must be open to challenges". Provided to China Daily

Rather than surrounding chief executive officers with people of the same age, same background and same perspective, this environment for creating global managers should feature, first of all, diverse cultures and intellectual challenges.

That is how Frank Brown, dean of INSEAD, the leading international business school with campuses in Europe, Asia and the Middle East, preaches about and practices leadership both on and off his campuses. Such was the focus of his recent talk with China Business Weekly in Beijing.

Brown is also a specialist in cross-cultural leadership, having been a practitioner of that in his 26-year career at the global auditing-consulting firm PricewaterhouseCoopers. He started his talk, like many other leadership seminars, with a list of leadership traits, or what he called leadership hallmarks - openness, integrity, humility, an optimistic outlook.

But slowly the audience realized he was not just talking about these qualities out of the context of the real world, as if they could be picked up from a B-school classroom or any office cubicle in corporate headquarters in London, New York, Shanghai or Mumbai.

An "awareness and willingness to engage and be intellectually curious about what's going on in the rest of the world is an absolutely critical component to being effective in a trans-cultural environment, and effectiveness gives you the opportunity to potentially lead", Brown wrote in his 2007 book, The Global Business Leader: Practical Advice for Success in a Transcultural Marketplace.

This sort of leadership can only be possible when it is made to grow in a nourishing environment, Brown said.

It is an environment that either company executives have either to be brave enough to throw themselves into, or to have forced on them by other people, whether that be society or the board of directors. Otherwise, companies would have LINOs, or leaders in name only, and make mistakes quickly in times of big change.

Only in an environment of diverse experiences and intellectual dialogues can CEOs really develop the hallmarks of a successful leader, make them their lifestyle and keep them from wearing out, he said.

To build up such an environment, Brown said, one key is to avoid letting a boss hang on to the top position for too long, especially when surrounded by people who are to following and cheering, rather than asking questions and thinking beyond the present.

His pet belief, that he has repeated often to the press, is that if you are a capable leader, you can be creative in not just one job - and that hanging on there for too long can actually make you less creative.

He also insists the kind of people with whom a true leader would need to surround himself or herself are those who do not just lean on the current leadership for tasks and achievements, but are keen to seek to improve by themselves. They will make a team that reflects diversity in every sense of the word, from gender to ethnic backgrounds, from education to skills and, perhaps most importantly, in their strategic contributions to the team.

"You've got to surround yourself with people who are diverse, have very, very broad perspectives in terms of education background, in terms of their cultural background, in terms of the language they speak," he said. INSEAD, which is celebrating half a century of success, prides itself on promoting a non-dogmatic learning environment that brings together people, cultures and ideas from around the world.

A lesson from the global crisis, he said, is that CEOs "must be open to challenges".

Good leadership would be hard to come by without such a healthy team environment, Brown said. Short of that, the longer a leader's tenure, the more likely he or she would make mistakes, and even huge losses. "We saw that in the financial crisis," he said, citing examples of the former Bear Sterns and Lehman Brothers banks, two Wall Street institutions that went bust under the stewardship of long-serving CEOs.

Open and meaningful internal dialogue is a good way to cope with external challenge and sharpen competitiveness, he said. This is also seen in China in the global financial crisis, such as the appeal to relocate coastal manufacturing operations to the interior regions. As a consequence of this, the crisis is being turned into an opportunity to benefit the whole population, the veteran consulting service leader said. However, one of the reasons why failures still abound in today's world - partly reflected by average companies' shortened life expectancy - is that in many cases, such an environment is not yet available to serve as "a constant reminder" to corporate executives.

Failures happen and they cannot all be eliminated. But this makes it all the more necessary, Brown said, to create an environment in which people are more skeptical so that mistakes are less frequent and less damaging.

Outside the management team there can be additional support. One is regulation. However, a good regulatory environment shouldn't be mistaken for just a good many government rules, Brown hastened to add. In fact, it would be a great help to good leadership if the regulators improved their whistle-blowing and investigative functions, he said. That way people such as Bernard Madoff, who was sentenced 150 years in prison in 2009 for committing a financial fraud amounting to more than $50 billion, would not have been allowed to keep operating for so long.

Within the company, the board of directors can also play a more useful role by holding regular evaluation sessions of the company executives, he said. The board should also be more active in the planning of the succession process, sometimes by hiring independent consultants.

Shifting his focus to INSEAD's relations with China, Brown was proud to report that Chinese application interest has remained high since the 1990s. At the school, there are not only students from China but also faculty members familiar with Chinese business practices. The Chinese experience in reform and development has contributed a great deal to INSEAD knowledge, as do its Chinese alumni to their school's prestige in this part of the world, Brown said.

China Daily