By Peter Laughter and Chris Paliani
“Hmm… that sounds like chaos.”
This is one of the most common responses we’ve gotten in our articles on distributed leadership. To which we say:
“Yes, if distributed leadership means removing command-and-control and not replacing it, then we agree!”
Of course chaos ensues when startups aim for “flat leadership” and there is no structure put in place for decision-making, and people can’t find who is accountable for making a decision.
But there is a big difference between “distributed leadership” and a bunch of people who happen to be working together without a structure or process in place to facilitate effectiveness or efficiency.
Distributed leadership isn’t about eliminating structure; on contrary it’s a carefully crafted structure that gets results you can’t get in any other way because it involves the input of the very people who have to execute decisions.
We’ve previously discussed the nuts and bolts of distributed leadership, and in this article we’re going to take a step back and compare both models of leadership. Our argument is not that distributed leadership is perfect. It has its limits and issues. But we want to point out that it’s a natural human tendency to jump to critiquing and poking holes in anything that is new — we rarely apply the same level of scrutiny to the existing system because we’re used to it.
Think about how we’ve somehow become resigned to the fact that 70% of transformation initiatives fail (source: Mckinsey). 70% is a really high failure rate, but somehow not everyone is clamoring about how top-down approaches to force transformations are broken. So the question is not: Which is perfect, but which is better? Which leads us to more optimal outcomes? If we look at results of organizations that have tried different approaches, it’s clear that distributed leadership pretty much wins every time it’s done right.
The difference in results between a top-down versus distributed approach has been well-documented in the field of foreign aid. The vast majority of foreign aid projects fail because organizations end up prioritizing (typically white) donors over recipients — that’s how you get millions of wells built by outsiders that fall into disrepair because they aren’t maintained. Building a well is a lot sexier for donors than maintaining a well. Only when the recipients of aid get to determine what they want and how they want it does outside help actually work. That’s why microlending, although it is not without controversy, is far more successful than centralized forms of lending. People have much more of a say in how they want to spend their money and are personally responsible for the success of their venture. Moreover, the rate of repayment, 96%, is so much higher than any other form of debt.
Ok, what about when it comes to running organizations? The appeal of command-and-control to many is that it seems more efficient. One person, or a small group of people, can make decisions much more quickly than 20 or 50 people. But command-and-control doesn’t actually create more efficiency if you take it a step further. Command-and-control merely creates the illusion of efficiency. That decision may have been made quickly, but there are many more people who have to implement the decision, and their lack of agreement or understanding of the decision will significantly impact if and how that decision gets implemented. It would be much more efficient if, from the beginning, those who are expected to execute also have decision-making responsibility. Imagine if we sat around and made decisions for the whole world. We could make them very quickly, but it wouldn’t matter because they would never be implemented unless, somehow, we got the majority of the world to buy into them.
Another major problem with command-and-control leaders is that their organizations end up following their idiosyncrasies too closely. Lee Iacocca did well when he was running Ford, but bombed when he became CEO of Chrysler in the later years. His approach was to find the next big thing, ride that success out until it dwindles down, and search for the next opportunity to be a hero again. Since he was a strong, decisive leader who wanted to be a hero, it was inevitable that his organization followed a pattern of up-and-down cycles that would set him up to be “the hero” who rescued his organization time and time again, instead of following a path of steady growth.
Let’s find a more positive example and turn to a more recent automobile CEO, such as Elon Musk. Although he is known for having a very clear and specific vision, it seems that Musk is very clear with his employees that how they want to communicate in order to get to that vision is in their hands. In 2018, he sent out an email to Tesla employees stating:
“Communication should travel via the shortest path necessary to get the job done, not through the ‘chain of command… Any manager who attempts to enforce chain of command communication will soon find themselves working elsewhere… [it] must be OK for people to talk directly and just make the right thing happen.”
This prioritization of getting things done over following the chain of command explains why Tesla has been accomplishing things at a faster rate than other companies. Now, there is reason to be skeptical here. On one hand, Musk is reaffirming the chain of command by acknowledging it exists — he is not abolishing it. On the other hand, he is telling employees to disregard it when it comes to communication. But that’s easier said than done: If your boss is very insecure, even with this general approval by your CEO, are you really going to stick your necks out and go over your boss’ head to get something done if you fear retribution? The edict from Musk itself speaks to the problems of command-and-control, especially the problems that arise when you try to have a foot in both worlds and have it both ways.
We’re not saying that setting up a thoughtful, distributed decision-making structure that makes sense for your context will be easy. It will be challenging and it may feel like you’ve created lots of unnecessary new problems for yourself. People will be unused, or even resistant, to suddenly being accountable for decisions because they were used to taking orders. Command-and-control is all that we have known — it’s embedded in our consciousness.
Shifting to a distributed leadership will be like resetting bones or heart bypass surgery: A challenging procedure that comes with its share of problems, but is absolutely necessary and leaves you better off in the long run. Over time, you’ll find that the early work you put in start to pay off — there will be less interventions required because you dealt with the fundamental root cause. You’ll find yourself surprised by the creativity your employees bring to the table, and find that what they come up with surpasses what you had in mind.
Let’s face it: We’re operating in a global context that is becoming extremely complex and that requires entire organizations to “turn on a dime.” It’s impossible for leaders to get all the information they need to make decisions quickly. (It wasn’t that long ago that our nation’s leaders were dismissing COVID-19 as a “very bad flu”). Already, thanks to the mass movement to working from home, middle managers are finding themselves less relevant thanks to the mass adoption of internet communication tools that enable greater spans of control (thanks to George Bradt for this analysis). We haven’t even touched on how millennials, the next generation of senior leaders, are pushing back against command-and-control decision-making.
These current trends are moving in the direction of distributed leadership, and are exposing the reality that command-and-control is chaos with lipstick. It’s a nicely painted bridge that’s rotted inside by termites. Even if it’s initially successful, it will end up breaking down eventually.
Chris Paliani is the founder and Chair of Kinext and enjoys seeing sales become more fun, easier and faster.
Peter Laughter is the founder and CEO of Spartoi Group and loves helping consultants hit above their weight class.
