Leadership systems: leadership as an organisational function

Leadership and organisation are two sides of the same coin. Those who view an organisation as a machine understand leadership as a matter for individual appointed people and their special qualities. This goes with a heroic self-image: the claim to have everything under control, the dominance of directive intervention and the conviction that people are usually to blame for mistakes.

In the systemic understanding, leadership is an organisational capability. It specialises in continuously producing the vitality of the organisation, in other words its ability to survive. Leadership is thus a property of the social system, which can be more or less well developed in practice. It no longer derives its authority from the functional hierarchy. It arises from the competence to put decision-relevant topics on the table between the people for whom they matter, and to organise this process.

Transformation processes bring complex decision requirements. Leadership teams bring together expertise across hierarchies and units for this purpose. Different goals must become visible and be able to be worked on before a decision is made.

Who prepares which decision? Who must be involved and who bears responsibility? These questions link leadership roles with committees, communication channels and decision routines. In the transformis understanding, organisational design and leadership system development are therefore considered together.

Coaching and leadership development can support people in their tasks. However, the specific need also depends on the expectations and conditions associated with their role. A development assignment should take both into account: the person and the context in which they lead.

Organisations behave in a self-referential way. Their established routines make them independent of their environments, even though they depend on them. A corporate crisis can be explained in this way: the demands of customers, suppliers or banks do not find enough resonance inside because attention is focused on internal processes.

Leadership therefore ensures stability and dynamism at the same time. Proven processes are protected and improved. In addition, the organisation needs a function at the boundary between inside and outside, with one foot outside and one foot inside. It sees what is happening outside and knows how to place it inside. This includes fixed communication routines in which observations from outside are evaluated and feed into decisions. Whoever takes on this task deserves the same protection as competitively relevant knowledge.

A forthcoming decision about the future offers a concrete starting point. It can be used to clarify which expertise is needed, which conflicting goals exist and how further implementation is organised. In this way, work on the leadership system is aligned with a task that is actually relevant.

The leadership wheel links market and customer orientation, resources, organisational development, people, controlling and strategy. Leadership ensures that these perspectives come together in the necessary communication and decision processes. A single role can bear responsibility. The work requires the relevant knowledge from the organisation.

The basic function of leadership is to supply the organisation with the tension it needs in order to function. To do this, leadership deliberately opens up differences between target and actual. Each of the six tasks in the leadership wheel responds to a typical tendency of organisations.

Organisations prefer to deal with problems of the past. Strategy development therefore draws its impulses for development from the difference between present and future. Left to themselves, organisations are preoccupied with themselves. Marketing aligns them with the requirements of the market. There always seems to be too little of everything, whether time, money or staff. Resource management ensures that existing means are exhausted first.

Organisations cling to established structures and routines. Organisational development asks what organisation the organisation needs. Members decide for themselves which of their abilities they contribute. HR management secures performance capability and willingness to perform. Familiar steering variables are also clung to. Controlling produces a realistic self-description.

Self-organised teams need a comprehensible mandate and suitable scope for decisions. Leadership deals with conflicting goals and ensures that cross-functional understanding becomes possible. The effectiveness of this interplay must be observed in the respective company context.

In transformations, departmental and unit boundaries slow down work on questions about the future. Existing expertise is not sufficiently connected and involved in decisions. An existing leadership system rarely recognises its limits under its own steam and does not adapt to new requirements by itself.

For managers this means saying goodbye to the claim to find the right solution alone for every topic. They recognise topics that need cross-functional work and create platforms and decision processes for them. They support decisions made in a cooperation within the agreed framework, even if these differ from their own point of view. Hierarchical individual decisions remain the exception. The yardstick is the view of the company as a whole and not the optimisation of one's own unit.

Leadership is an interplay of different functions and roles. For an important decision this can be tested very concretely: which expertise is needed, who prepares alternatives, where are conflicting goals discussed and who holds the mandate for the decision? The leadership wheel names market and customer orientation, resources, organisational development, people, controlling and strategy as perspectives. They do not have to be equally represented in every meeting, but they must not be missing by chance on crucial questions about the future.

Coaching can support a person in their role. A recurring lack of involvement or mandate additionally requires work on the system. The result is a comprehensible decision path in which formal responsibility and subject-focused cooperation fit together.