Stokes Jolly Ltd

Behavioural Realities of the Boardroom

Jon Stokes

Stokes Jolly Ltd

Behavioural Realities of the Top Team

• Group Behaviour – Groups & Teams• Personality• Emotional Intelligence• Leadership styles• Organisational Culture• Evolutionary psychology• Implications for Top Teams and

Boards

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4 Fundamental Tasks of the Board

• Accountability• Policy Formulation and Foresight• Strategic Thinking• Supervising Management

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Different Board Styles

Country-Clubboard

Professional

board

Rubber-stampboard

RepresentativeboardC

on

cern

for

board

re

lati

on

ship

s

Concern for board tasks

High

LowLow High

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The Working Board Model : responsibilities

The Thinking

Board

Accountability• To owners• To regulators & legislators• To other stakeholders• Ensuring directorial audits

Policy Formulation• Stating purpose• Creating vision &values• Developing corporate climate• Monitoring external environments

Supervising Management• Overseeing management performance• Monitoring budgetary control• Reviewing key business results•Competencies of employees

Strategic Thinking• Positioning in changing markets• Setting corporate direction• Reviewing & deciding key resources• Deciding implementation process

EXTERNAL

INTERNAL

SHORT TERMBOARD PERFORMANCE

LONG TERMBOARD PERFORMANCE

CONFORMANCE PERFORMANCE

Chairman & Board

Chief Exec. & Management

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A board should be selected, trained, developed and

appraised on their directorial abilities to:• formulate policy and so give foresight

• think strategically• collect accurate external and internal data• generate imaginative ideas• be capable of open questioning and critical review• be rigorous in risk assessments• be collegial in strategic decision-making• learn systematically from their directorial

strengths and weaknesses• ensure organisational capabilities for successful

strategic implementation• ensure rapid feedback for honest information on

the implementation of the strategy

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Unique Issues in

Executive Teams

Bloated Membership

Blind Ambition

Executive Moose

Centrifugal Force

Ambiguous Roles

Dancing Bears

Potential Actions to Deal with the Unique Issues

Design TeamsCreatively

Manage SuccessionDynamics

Create Conditions thatPromote Openness

Reinforce TeamIdentity

Clarify Team Roles andProcesses

Leverage theAgenda

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Work

• What it is you are accountable for• The What by When• Work starts with something that is missing• Work evokes emotion and anxiety• Work needs to engage us emotionally to be meaningful

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Working assumptions

• All organisations now work in an environment of continuous and turbulent change

• How organisational leadership responds to this is a central determining factor of organisational effectiveness and success.

• Pressure for companies to deliver short-term has resulted in a lack of commitment from employees and the overuse of financial reward as the primary motivator.

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Complexity a common factor- dealing with multiple

constituencies

• Shareholders • Customers • Employees • Communities • Society

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3 Fundamentals of Leadership

Awareness of the Whole • To be effective in organisational settings, people need an

awareness of the whole, and to see reality from as many points of view as possible; they need to have information available which disturbs and refines their perception of reality and to be able to express reality as they see it.

Connectedness • Secondly, people need connectedness to others they are engaged

in a common endeavour with, at the level of the heart, of the intellect and the spirit. The quality of relationship between human beings largely determines their ability to work together.

Alignment • Thirdly, human beings need alignment around a common purpose,

strategy, plan of action, set of values and approach to working together to make the best of their combined energy and capabilities.

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Psychological characteristics of the board and top team

• Emphasis on performance, conformance and competition

• Results oriented - wanting right answers quickly • Fear of looking incompetent or foolish, fear of

mistakes - fear of not knowing• Atmosphere of mistrust, competitiveness, being too

open - makes you vulnerable to the predatory ambitions of others (colleagues, owners, subordinates)

All can mitigate against effective decision-making and judgment which requires a combination of cognitive and emotional intelligence.

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Typical Leadership Competencies at Different Career Stages

First First Supervisory Supervisory

LevelLevel

Mid-Mid-Management Management

LevelLevel

analysis and planninganalysis and planning organising and decision-makingorganising and decision-making

influencing and networkinginfluencing and networking achievement and driveachievement and drive

politics & teambuildingpolitics & teambuilding

Executive Executive LevelLevel

inside-outside visioninside-outside vision strategic thinkingstrategic thinking

empoweringempowering coaching & mentoringcoaching & mentoring

conceptual and technical skillsconceptual and technical skills

collaborative skillscollaborative skills energy and ambitionenergy and ambition

self-presentationself-presentation

making decisions without full informationmaking decisions without full information

implementation skillsimplementation skills

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ROLE

PERSON TASK

ORGANISATION

Person - Role - Task - Organisation

•Accountability•Authority•Resources

•Output•Processes•Rewards

•Purpose•Strategy•Structure•Culture

•Capability•Life/Career Stage•Motivation & Values•Personality

E n v

i r

o n

m e

E n v

i r

o n

m e

n t

n t

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The Visible and the Invisible Group

Visible• Individuals• Words• Behaviours• Conscious

Invisible• Group-as-a-

Whole• Feelings• Meanings• Unconscious

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Group dynamics are the result of many factors

• Competing interests• Difficulties and frustrations in the way of

progress• The pressures of the external environment• Different personalities different needs• Fear of ‘destructive’ differences• Fears of loss of individuality and ‘merger’

and more………..• So, effectiveness is a balancing act

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The Tensions between the Individual and the Group

The Group needs from the

Individual: • Commitment• Acceptance of

norms• Role behaviour• Acceptance of

authority structure

The Individual needs from the

Group: • Belonging • Influence • Achievement • Containment

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Life in a group is a balancing act

• Individual vs. Role• Task/Output vs. Process/Getting

there• Being an Individual vs Merging into

the Group• Sub-groups vs. Whole group• Internal Environment vs. External

Context

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Group Dynamics – Some Themes

• Inclusion vs Exclusion• Conformity vs Diversity• Individuality vs. Merger• Dependency Cycle:Dependence-Counterdependence-Independence-

Interdependence• Intimacy vs Distance: Over-personal vs. counter-

personal • Safety vs Risk• Competition vs. Collaboration• Leadership vs. Followership

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In every group ‘two’ groups are present - the Work Group and the

Basic Assumption groupWork Group

• aim is to complete a specified task

• purpose is explicit• structure and roles are

there to further the task, individuals judged on their competence at the task

• leader is not the only one who has skills and leads as long as his/her leadership serves the task of the group

• members operate as separate and discreet individuals

Basic Assumption Group• aim is to preserve itself and

alleviate the anxieties/satisfy the needs of its members

• purpose is tacit, operates on an ‘as if’ basis

• individual judged not by skill but by willingness/competence to enter into the b.a.

• leader is subservient to the group’s needs, constantly seduced by group away from its task

• individuals regress, relinquish independence and freedom of thought/action

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The Work Group and Basic Assumptions

Work• Atmosphere of ‘industry’; Group

constantly tests itself in a scientific spirit.

• Orientation is external and reality guides

• Learns from experience/ mistakes

• Members belong by conscious choice and work to the agreed purpose of the group

• Its seeks for knowledge, learns from experience, and constantly questions how it may best to achieve its goal. It is conscious of the passage of time and of the processes of learning and development.

Basic Assumption Group• Atmosphere of vague unease,

individual feels in danger of either being swallowed up, victimised, expelled but can’t identify why.

• Orientation is internal Individual who challenges will be scapegoated

• Do not learn from experience• Members belong to alleviate

anxieties, gain security and have needs met

• Fantasy drives and impulses are acted out

• Memory poor, time disorientation, language of reminiscence, cliché, loose generalisation

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Basic Assumptions – Wilfred Bion

3 Fundamental States of Mind

• Dependency

• Fight-flight

• Hope (Pairing)

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DependencyGroup behaves as if its primary task is solely to provide for the needs and wishes of its members.The leader’s task is to look after, protect and sustainthe members, not to face them with the demands ofreality.The leader may be absent or even dead provided theillusion that he/she contains the solution can bemaintained. Debates are about what the leader wouldhave said.Atmosphere: passivityEmotions: Reverence, envy, guilt, depression.

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Fight-Flight

Group behaves as if its primary task is action to deal with an

enemy either internal or external. However it is prepared to

do either indifferently.The leader’s task is merely to devise courses of action, leadeither attack or flight, the group’s task is merely to follow.Both do so without recourse to practicality or effectiveness.Atmosphere: paranoiaEmotions: Anger, fear, hate

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Hope (Pairing)

Group behaves as if its primary task is to create a better future

to give birth to a solution which will save it from its current

difficulties.The leader is unborn The group’s task is to watch and wait.Atmosphere: hopefulnessEmotions: Hope, enthusiasm, despair,

disillusion

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The Work Group and Basic Assumptions

“The individual is a group animal at war not simply with the group, but with himself for being a group animal and with those aspect of his personality that constitute his 'groupishness'.”

Experiences in Groups Wilfred Bion (1961)

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Leader’s Task

Fundamental

Behaviour and

Emotion

Institution

ProfessionCommerc

e

Aberrant Forms

Dependency

Identify and

provide for needs

of members

FeedingChurchDoctorsAirlines

Counter-Dependen

cy

Fight-Flight

Identify the enemy

and attack or

flee

Fighting

ArmySocial

Worker Investmen

t Banks

Paranoia

Hope

Unborn Messiah

or Utopian

Idea

Pairing

Marriage Therapist

s Advertisin

g PR

Collusion

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Basic Assumptions in Commerce

• Dependency – we will take you there – Airline

• Fight-flight – we will make you lots of money but don’t expect us to tell you how – Investment Banks

• Hope – we will make you successful and help you to believe in yourself – Public Relations

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GroupthinkGroupthink• A mode of thinking whereby pressures for unanimity overwhelm the

member motivation to appraise realistically the alternative courses of action

• Group pressure lead to carelessness, poor decisions and low quality actions• Group pressures result in irrational thinking and action

• Collective Rationalization – members discount warnings that their thinking is irrational

• Stereotyping the Adversary – painting an unappealing, inaccurate, self-serving picture of the adversary

• Self-Censorship – members censor thoughts that are opposed to group ideas

• Pressure on Dissenters – dissenters within the group are pressured into conformity

• Mind guarding – actively protecting group from outside ideas that may contradict the group decision or ideas. Some members play the role of mind guard

• Apparent Unanimity – Everyone on the surface is in agreement, but there is probably some doubt being hidden from the group

Symptoms of Groupthink• Illusions of Invulnerability – feeling that the group is beyond harm

• Illusions of Morality – feeling that the group is right, good and moral therefore anything it odes is right, good and moral

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GroupthinkSome ‘Causes’ of

Groupthink• High Group Cohesion• Homogeneity• Insulation of Group form

Outside Influences• Lack of clear-cut rules to

guide decision making• Stress on Group and

Group Membership• Promotional Leadership

(leader promotes their favourite ideas, while neglecting alternatives)

Preventing Groupthink

• Leaders should encourage dissent

• Leader should remain impartial

• Subgroups work on problem independently

• Rethink group decisions in ‘second chance’ meetings

• Allow third party analysts to provide feedback to group

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Groupthink

Some ‘Causes’ of Groupthink

• High Group Cohesion• Homogeneity• Insulation of Group form

Outside Influences• Lack of clear-cut rules to

guide decision making• Stress on Group and

Group Membership• Promotional Leadership

(leader promotes their favourite ideas, while neglecting alternatives)

Preventing Groupthink

• Leaders should encourage dissent

• Leader should remain impartial

• Subgroups work on problem independently

• Rethink group decisions in ‘second chance’ meetings

• Allow third party analysts to provide feedback to group

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Avoiding Conformity Pressure- ‘Groupthink’

• Gather outside opinions• Handle, don’t avoid, group controversy• Question weak arguments• Consider carefully before taking decisions• Avoid censoring deviants

• Understand reason for deviance

• ‘Risky Shift’- when group decisions are more risky or more cautious than individuals

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What makes a group into a team?

• Shared Task with shared Accountability• Common Understanding of Aims and objectives• System of Roles• Managed Boundary: Resources and skills managed

within this

• System of Feedback – clear criteria for success and failure

• System of Review - Progress - Process

• Discusses, decides and does (not delegates) the work

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Behavioural Realities – non-team

behaviour is more natural1. The best senior leadership groups are rarely a true

team at the top—although they can and do function as real teams when major, unexpected events prompt that behaviour.

2. Most of them can optimize their performance as a group by consciously working to obtain a better balance between their team and non-team efforts—rather than by trying to become an ongoing single team.

3. The secret to a better balance lies in learning to integrate the discipline required for team performance with the discipline of executive (single-leader) behaviour—not in replacing one with the other.

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Top executives are supposed to: • Direct and lead the actions of large numbers of people—whereas a

team moulds the skills of a small number of people. • Exercise personal judgement in assessing risks, resources, and

strategic options—whereas a team makes collective judgements through open dialog, conflict resolution, and real work.

• Make assignments based largely on formal positions in the formal organizations—whereas team members' assignments are made on the basis of the specific required skills, regardless of their formal organizational role.

• Be primarily responsible for broad corporate strategy, policy, and objectives—whereas a team's purpose and goals must be more tightly focused on specific performance results.

• Leverage their time and experience through efficient organization and management processes—whereas a team is seldom the most efficient grouping or process for getting something accomplished.

• Pinpoint individual executives to make the critical decisions—whereas a team makes critical decisions in a variety of different ways, using whatever person or grouping will yield the best decision.

• Manage performance of the organization by establishing clear-cut, individual objectives and work products—whereas a team must establish joint objectives and deliver collective work products.

• Be individually accountable for "whatever happens on their watch"—whereas a team must hold itself mutually accountable for the collective results of all members.

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Power and AuthorityPower is an attribute of the PERSON

• Personal Power• Resource Power

- Expertise- Network- Information

• Position Power• Projected Power

Authority is an attribute of ROLE arising from a TASK –

ROLE: the idea in the mind by which an individual manages his/her self in relation to the system.

Power may be exercised without matching authorityAuthority cannot be exercised without matching power

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The Evidence That Enables Us to Predict Successes and Failures As

Future Senior ManagersIn a 10 year follow-up study of top executives who derailed (centre for creative leadership 1996) the two most common traits are those who failed were:Rigidity: they were unable to adapt their style to changes in the organisational culture, or they were unable to take in or respond to feedback about traits they needed to change or improve. They couldn't listen or learn. Poor relationships: The single most frequently mentioned factor: being too harshly critical, insensitive, or demanding, so that they alienated those they worked with.

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Other differentiators were:

Self-control: those who derailed handled pressure poorly, and were prone to moodiness and angry outbursts. The successful stayed composed under stress, remaining calm and confident - and dependable - in the heat of crisis.

Conscientiousness: The derailed group reacted to failure and criticism defensively - denying, covering up, or passing on the blame. The successful took responsibility by admitting their mistakes and failures, taking action to fix the problems, and moving on without ruminating about their lapse. Trustworthiness: The failures typically were overly ambitious, too ready to get ahead at the expense of other people. The successes had high integrity, with a strong concern for the needs of their subordinates and colleagues, and for the demands of the task at hand, giving these higher priority than impressing their own boss at any cost.

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Social skills: The failures lacked empathy and sensitivity, and so were often abrasive, arrogant, or given to intimidation of subordinates. While some were charming on occasion, even seeming concerned about others, the charm was purely manipulative. The successes were empathic and sensitive, showing tact and consideration in their dealings with everyone, superiors and subordinates alike.

Building bonds and leveraging diversity: The insensitivity and manipulative manner of the failed group meant that they failed to build a strong network of co-operative, mutually beneficial relationships. The successes were more appreciative of diversity, able to get along with people of all kinds. They built a network of contacts and friendships within and outside the firm.

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Successes vs. Failures

• Rigidity• Poor relationships• Self-control• Conscientiousness• Trustworthiness• Social skills• Building bonds and leveraging

diversity

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Needs in a Team

• Belonging• Sense of Achievement• Influence• Containment

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ContainerAn effective group or organisation needs to provide a container (vessel, crucible) – a setting of shared meaning and energy in which the intensity of human interactions, conflicting meanings, and experiences necessary to its work can unfold constructively.Eg, Family, Marriage, Institutions

The management of the container is a central task of management.

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What is Emotional Intelligence?

‘Anyone can become angry – that is easy. But to be angry with the right person, to the right degree, at the right time, for the right purpose, and in the right way – this is not

easy.’Aristotle, The Nicomachean

Ethics‘The capacity for recognizing our own feelings and those of others,

for motivating ourselves, for managing emotions well in

ourselves and in our relationships.’

Daniel Goleman, Emotional Inteligence

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Awareness Actions

Self

Self Awareness•Emotional Self-Awareness

•Self Confidence•Accurate Self-Assessment

Self Management•Self Control

•Trustworthiness•Conscientiousness

•Adaptability•Achievement Orientation

•Initiative

Others

Social Awareness •Empathy

•Organizational Awareness•Service Orientation

Influencing Others•Developing Others

•Leadership•Influence

•Communication•Change Catalyst

•Conflict Management•Building Bonds

•Teamwork and Collaboration

EMOTIONAL INTELLIGENCE – Goleman Model

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FIRO-BMeasures of Interpersonal

Need• Inclusion

• How much you generally include other people in your life and how much attention, contact and recognition you want from others (groups)

• Control• How much influence and responsibility you want

and how much you want others to lead and influence you

• Affection• How close and warm you are with others and

how close and warm you want others to be with you (1-on-1)

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Leadership Styles

• Coercive – demands compliance - do what I say

• Authoritative – mobilizes toward a vision - come with me

• Affiliative – builds bonds - people come first • Democratic – forges consensus - what do you

think?• Pacesetting – sets high standards - follow my

example • Coaching – develops people for future – try

this

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The Style in a Phrase

“Do what I tell you!”

Works Best When

In crisis, kick-starting a turnaround, and/or with

problem employees.

Overall Impact on

ClimateNegative

Underlying EI

Competencies

Achievement Orientation,

Initiative and Self Control

Coercive

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Authoritative

The Style in a Phrase

“Come with me.”

Works Best When

A new vision required and/or

clear direction needed.

Overall Impact on

ClimateMost strongly positive.

Underlying EI

Competencies

Self-Confidence, Empathy and

Change Catalyst

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Affiliative

The Style in a Phrase

“People come first.”

Works Best When

In stressful circumstances and/or healing rifts.

Overall Impact on

ClimatePositive

Underlying EI

Competencies

Empathy, Building Bonds and

Communication

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The Style in a Phrase

“What do you think?”

Works Best When

Building buy-in, working for consensus, and/or getting

input.

Overall Impact on

ClimatePositive

Underlying EI

Competencies

Teamwork, Collaboration,Leadership and Communication

Democratic

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Pacesetting

The Style in a Phrase

“Do as I do, now!”

Works Best When

Needing quick results from a highly motivated and

competent team.

Overall Impact on

ClimateNegative

Underlying EI

Competencies

Conscientiousness, Initiative and Achievement

Orientation

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The Style in a Phrase

“Try this.”

Works Best When

Improving performance and/or developing long-term

strengths.

Overall Impact on

ClimatePositive

Underlying EI

Competencies

Self-Awareness, Empathy and

Developing Others

Coaching

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Boundaries

The work place is a system that can be understood in terms of boundaries - within/without - and managed by these:• Task - What is my work/ what is not• Power - What authority do I have/ have not• Identity - Who am I/who am I not• Values - What is acceptable here/ What is not acceptable here

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Each member of the group inhabits three realms of reality

• Private Space - a personal internal world of thoughts, dreams, desires and feelings - personal reality - purely subjective

• Public Space - an agreed world, conceived of in space and time - scientific and common-sense reality - roles and tasks - realm of the objective

• Inter-subjective Space - a shared mental world of shared creations of the mind, fantasies, attitudes, values, assumptions and misgivings - mental events which nevertheless by virtue of being held in common have a great influence on the life of a group and in that sense extremely real - both me and not me/you - the inter-subjective world.

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The Organisation in the Mind

The conscious and unconscious ideas and feelings that make up the internal representation of ‘the organisation’ in the minds of its members

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Organisational Culture The nature of organisations means that they are "uncheckable fantasy space", the domain of myths and dreams as much as of reality, similar to the unconscious of psychoanalysis. These features include a facility for splitting, projecting & introjecting. Culture in the group is the analogue of the mind in the individual .

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Mythological structure of organisations

Myths are used to confront a problem and provide one or more solutions that allay anxiety. Whereas science offers rational explanations, it also tends to bypass the causes of anxiety - our primordial fears of being separate, detached, and lonely. These fears persist until some commonly held beliefs, expressed in myths, renew our sense of belonging and of the community of life. One's ultimate protection from anxiety is to belong to a strong, cohesive group.

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Organisational Culture

• The commonly held and relatively stable beliefs, attitudes and values that exist within the organisation

• ‘How you get things done around here’

• Different levels of culture• Artefacts: the constructed environment• Behaviours: visible and audible• Attitudes and espoused values: inferred• Underlying assumptions

• Can be articulated with effort• Unknown or unconscious• Covert

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How Culture is created

Primary Drivers of behaviour create the

culture:

• What leaders pay attention to and control

• Leader reaction to critical incidents and organisational crisis

• Deliberate role modelling, teaching, and coaching by leaders

• Criteria for allocation of rewards and status

• Criteria for recruitment, selection, promotion, retirement, and excommunication

Secondary articulation reinforcement mechanisms:

• The organisation's design and structure

• Organisational systems and procedures

• Design of physical space, facades, and buildings

• Stories, legends, myths and parables about important events and people

• Formal statements of Organisational philosophy and creeds and charters

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The fit between an organisation's culture and the demands of the

business environment determines an organisation's success

– Deal & KennedyThey argue that an organisation's culture

can be characterised by: • - the degree of risk associated with the

company's key activities • - the speed of feedback at which the

company and its employees get on whether their decisions and strategies have been successful

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High

Low

Risk

Big-Stakes

Eg. Oil

Big Corporates→ DeliberatenessProcess

Eg, Banks

Government

→ Technical Perfection

Low

Tough-Guy

Eg. Investment banks

Advertising

→ Insider/OutsiderTeam

Eg. Retailing

High Tech

→ Persistence

High Feedback

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Evolutionary Psychology

The apparently immutable characteristics of humans according to evolutionary psychology:

Dominance of emotion over the rational - emotions are the first reaction to everything seen or sensed. When we receive feedback, especially if it has a negative element, our natural disposition is not to think about it. We are easily manipulated, even when we realise it, because warm emotion is so much more important to us and call reason.

Predictably primitive behaviour • Co-operation, sharing, specialisation and friendliness • Stereotyping on first impressions - in a threatening and

complex environment it is necessary to classify things immediately on the most basic data.

• Breast-beating and mindless optimism • When life is random and terrifying the person who appears

less terrified and most confident slightly to attract followers, food and sex. Confidence becomes more high devalued and widespread than realism.

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Evolutionary PsychologyA taste for hierarchy - the desire to follow confident leaders and

to find security in a change of status relationships seems to be pronounced traits of primitive society.

• Conformism and herding - allied to hierarchy is the tendency to conform internally and be suspicious of those outside. High-status individuals are imitated. There is a natural tendency to do what a hierarchy once. A sense of identification within the group lead to cohesive behaviour in the face of external threat. Conformity pays.

• Hostility to out-groups - the strength of the clan and it conformity has the flipside of hostility to those outside. It appears that the more co-operative societies or the more violent the battles between them.

The avoidance of risk - hunter-gatherers tend to only take risk when faced with danger stop we appear to be risk-averse when we can afford risk, and yet risk-takers when losses are endemic.

• Mad scrambling when under serious threat - the more successful scramblers survived more often so that scrambling under threat is part of our genetic make-up. When he normally sane person is under pressure while driving 'road rage‘ or sudden panic may take over. When a factory closes, certain employees may become hysterical or aggressive.

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Technical vs. Adaptive challenges

Technical challenge – known problems with established solutions, execution is the key - the application of current know-how by technical experts/ authorities. Appropriate when what needs to be done is apparent,resources needed and capabilities required are clear.Leaders provide direction and solutions.

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Technical vs. Adaptive challenges

Adaptive challenge – either or both of the problem and the solution are not clear. Solution will require changes in norms, values, expectations and strategies. It will involve changes in roles, relationships, assumptions and require new values, behaviours, approaches, attitudes; the learning of new ways by the people with the problem. Leaders challenge and ask tough questions. People with the problem find the solution.

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Negative Capability“I had not a dispute but a disquisition with Dilke, on various

subjects; several things dovetailed in my mind, and at once

it struck me what quality went to form a Man of Achievement

especially in literature and which Shakespeare possessed so

enormously - I mean Negative Capability, that is when a man is

capable of being in uncertainties, Mysteries, doubt, without

any

irritable reaching after fact and reason.”

John Keats

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• What advice would you give to an about to be appointed new top team member ?

• What issues would it face you with ?

• What about your own organisation ?