Leadership and witchcraft: leadership as fence riding

The conditions under which organisations and companies have to decide and act are subject to great volatility. The idea of being able to predict the future is increasingly giving way to the fact that one has to adjust to new surprises almost daily. Expectations, requirements and influencing factors seem to change faster than ever before.

The paradigm of cause and effect is giving way to the realisation that impenetrable interdependencies determine our lives. This also applies to organisations. Added to this are influences such as those of the financial sector, whose crises shake entire markets. This raises the question of how organisations cope with such shocks and what is needed for them to secure their existence in volatile environments.

From transformis’ point of view, leadership is needed more than ever. This does not mean the charismatic leader or seducer who largely determines the fate of an organisation alone. Leadership stands for processes, structures and worldviews in organisations that make it possible for changes outside the organisation first to be perceived and then to be processed further.

Once the changes have been recognised and can be described and communicated, it is ensured that a systematic evaluation takes place within the organisation, so that the insights can feed into decisions. This is no longer the sole task of individual executives. It has become an organisational challenge.

If one takes the findings of modern systems theory seriously, it follows that leadership is an important organisational core capability that must be firmly anchored in the system. Leadership is the ability to organise the observation of the relevant environments in such a way that the observations are evaluated and useful information is placed and communicated internally so that it resonates inside. The following chapters show what this has to do with witchcraft.

According to the classical approaches of organisation theory, the task is the most important element of the organisation. Without a task there is no task holder. Organisational structure and process organisation are the focus of attention.

Modern systems theory helps to look at organisations differently. Karl Weick saw action as the basic element of an organisation. Action follows action. Accordingly, organisations are to be regarded as systems of action.

Niklas Luhmann saw individual communications as the basic element of social systems. They are events that only ever take place in the present. They cannot be observed directly and can only be inferred. In this sense, transformis understands organisations as social systems whose basic element is individual communications.

Patterns of action are to be explained as the result of communication. Communication helps to reconstruct actions. The event of communication interlinks the actions of different actors, so that individuals acting alone become participants in social systems. Only in this way are achievements possible that only organisations can produce, such as the development and production of a wide-body aircraft.

Organisations have structures and patterns of action that are meant to ensure that a usable output is delivered. In doing so, they reproduce themselves through their specific communication events, namely decisions.

Decisions in this sense are not the inner deliberations of an individual in the organisation. They are events that are accepted in the organisation as a shared commitment. Decisions are meant to turn uncertainty into certainty by deciding how things will proceed.

As a social system with patterns of action and repetitive processes, an organisation is surrounded by its environments. These include customers, suppliers, banks, employees as well as the town and municipality.

Organisations are autopoietic. The term is derived from the Greek autos for “self” and poiesis for “creative activity”. It means that systems create themselves as distinguishable units through their internal processes. Organisations behave in a self-referential way and reproduce themselves out of themselves.

As a result, they make themselves autonomous from their environments through their established routines, even though they depend on relevant environments. One can therefore abandon the idea that the environments provide the essential impulses for the development of an organisation.

A corporate crisis can be explained like this: because of the focus on its own internal operations, the demands that the relevant environments place on the company do not meet with sufficient internal resonance.

The self-reference of organisations can make them blind to the dynamic demands of the relevant environments. On the one hand, effectiveness and efficiency are required in order to offer attractive products and services. Stability and complexity reduction are supporting factors for this.

On the other hand, the organisation must constantly look outwards to recognise changes in the relevant environments and make them an issue internally. Irritation must be used to ensure that suitable structures and routines are established so that the output gains rather than loses attractiveness. Irritation is necessary because the organisation by nature concentrates on its own internal operations. This does not happen by itself.

This is where leadership has an important task to perform for the organisation. Leadership provides stability and dynamism in equal measure. Established processes and routines must be optimised and protected to ensure effectiveness and efficiency. Likewise, the relevant environments must be closely observed in order to recognise changes or pick up trends, which are then prominently declared an issue and worked on in the organisation.

The dynamism in the various environments underpins the thesis that organisations need this leadership function and must maintain and practise it to a sufficient degree. More than ever, the question is how the leadership process should be differentiated in order to meet constantly changing requirements and secure lasting business success.

In Germanic belief, a witch was a fence rider. Etymologically, the German word Hexe can be traced back to the Old High German hagzissa or hagazussa. It describes a figure sitting on the fence. With one leg she was in the area of her own farmstead, with the other in the neighbouring land. Witches were neither entirely here nor entirely there.

Traditions show that they questioned existing paradigms. They carried ideas from the “outside world” into the “inside world”. The consequence is well known: witches were burned because they questioned what was established.

This is the connection between witches and leadership. Organisations need the function that deals with the boundary between inside and outside, with one leg outside and the other inside. It is about seeing what is going on outside and knowing how to place it inside. This is a balancing act between stability and dynamism, between preservation and change, between conservation and innovation.

Leadership exists when organisations have the necessary processes, structures and worldviews to process and differentiate constant observation. Organisations with leadership ensure that enough people sit on the fence to look outwards and inwards.

People who take on the witch’s function of fence riding are protected by the organisation just as much as existing know-how that secures competitive advantages. In this sense, leadership means establishing suitable communication processes that make it possible for the observations of the “witches on the fence” to be evaluated and for the insights to feed into decisions. This gives every organisation a simple test question: how many witches are sitting on its fence?

Fence riding is actively encouraged and rewarded. Attempts to burn the witches are nipped in the bud, because it is recognised that the witches help to break through the self-reference of one’s own organisation. Witches can be people or established routines.

The result is that the organisation engages with its relevant environments, recognises expectations and demands and takes them into account in its own patterns of action and repetitive processes.

In this organisational context, transformis links leadership with eleven challenges that have to be mastered by people and established routines. The first five concern direction and boundary work.

The first challenge is to create an identity and a vision of the future. Leadership ensures that the organisation has a clear identity and can answer two questions: What are we here for? Where do we want to go?

The second challenge is to confront the current state with possible target states and thereby energise the organisation. This includes ensuring a clear differentiation between the internal relationship and the relevant environments, the external relationship.

The third challenge is to ensure focus. The organisation is consistently organised around agreed goals. Leadership ensures that the overall course is maintained, even when events make tactical action necessary.

The fourth challenge is to encourage fence riding and turn it into processes. The symbolic witches on the fence, whether people or processes, are given a platform and space in the company and are not burned. Suitable communication routines are established so that observations from outside are evaluated and used inside.

The fifth challenge is to see the internal and external perspectives equally and to play the balance between preservation and renewal. Current issues are consistently taken up to keep the company viable for the future. At the same time, what is good is protected so as not to jeopardise the organisation’s ability to function.

The sixth challenge is to provide decision programmes. The organisation is supplied with programmatic decision premises in order to give the process of corporate development a clear direction. Decision programmes provide the criteria for the correctness of decisions. Purpose programmes specify which output and which goals the organisation should strive for, following the pattern “in order to”. Conditional programmes specify how the organisation is to react to certain inputs, following the pattern “if, then”.

The seventh challenge is to describe and optimise processes. They are stabilised and optimised so that the organisation’s services can be delivered efficiently and effectively.

The eighth challenge is to influence communication structures and to set the internal rules of interaction and communication. Communication free of hierarchy is made possible without dissolving the formal hierarchy. Non-hierarchical problem-solving processes are initiated that look for the best solutions on the merits. The right people are brought together so that good solutions emerge from communication and the existing intelligence of the organisation is used.

The ninth challenge is to bring in and keep the right people. Programmes are linked to people. It is therefore important to make sure that the right employees are deployed in the right place. Necessary personnel decisions are brought about and implemented without delay.

The tenth challenge is to provide the appropriate frameworks for observation and assessment and thereby to determine the cultural characteristics of an organisation. It must be clarified through which lens assessments are made and decisions prepared, what is desired and what is not, who gets into the organisation and who has to leave it, who is promoted and who is sidelined.

The actors in the organisation observe closely through which actions such questions are answered. This largely determines the cultural characteristics of an organisation.

The eleventh challenge is to develop and establish the capacity for reflection. The organisational conditions are observed again and again, the observations are evaluated and the need for action is worked out. Attention is also paid to which patterns of observation are used when observing, in order to identify further options for action.

In times of crisis, people increasingly look for orientation and expect leadership or management. The relevant management literature has dealt very intensively with leadership and management for decades. The multitude of definitions and descriptions cannot be fully appreciated here. However, some positions of renowned authors show the range.

In his book “Außer Dienst” Helmut Schmidt records an observation about the way Germans use language. The words Führen and Führung (leading and leadership) are used reluctantly in Germany because of the National Socialist Führer cult. But there is no other word in the German language that would be better suited. In English, by contrast, the word leader is taken for granted.

transformis shares the view that leadership cannot be removed from the vocabulary and that it must be ensured that leadership takes place in organisations. Leadership is seen as a functional challenge. The focus should not be solely on the leader’s personality.

Fredmund Malik heads effective management with the words leading, performing, living and describes right and good management as the key to success. He makes it clear that management must be understood in terms of its function. It is about fulfilling tasks, doing work and making contributions. Ultimately, management is the transformation of resources into benefit. According to Malik, right management leads to effectiveness and efficiency.

English and American literature distinguishes between leadership and management. In 1990, John Kotter wrote in the Harvard Business Review, in essence, that management is about coping with complexity. Its methods, he said, were a response to the emergence of large organisations in the 20th century. Good management brings order and consistency to key dimensions such as the quality and profitability of products.

According to Kotter, leadership is about coping with change. Its importance has grown because the economy has become more volatile and competition tougher, for example through faster technological change, more international competition, deregulated markets and demographic change. Repeating yesterday or improving it by five per cent is no longer a recipe for success. More change always requires more leadership.

In 1996, Richard Pascale described management, in essence, as the exercise of authority and influence to achieve a level of performance consistent with that previously shown. Leadership, he said, means making something happen that would not have happened anyway. This always involves working at the edge of what is acceptable.

In 1998, John Mariotti put it in an image: leaders are the architects, managers the builders. You need both, but without the architect there is nothing special to build.

Representatives of modern systems theory see a close connection between society, organisation and leadership. Three positions come from interviews that Bernhard Krusche published in 2008 in the volume “Paradoxien der Führung”.

Dirk Baecker distinguishes between management and leadership. For him, management is, in essence, the authority in a company that wields the economic club. But the company is also a social institution. Leadership must therefore concern itself with social considerations and possibilities. It must legitimise the products and the access to labour outside the company as well. It must make clear that an interesting and socially relevant option is being pursued in the company.

Rudolf Wimmer defines leadership as a function within social systems. Function holders look at the organisation as a whole and mobilise a particular kind of attention. They observe their respective area of responsibility from the point of view of whether they are on a good path in view of their own task.

According to Wimmer, leadership first takes the whole into view and from there energises the respective area of responsibility, so to speak, in order to confront the current state with possible target states. This tension is directly connected with the reason for the existence of every organisation, with the question: What are we here for?

Fritz B. Simon understands leadership as influencing the communication structures, the worldview and the decision-making foundations of the organisation and its members. This happens in the knowledge that none of this can be achieved through a linear mode of cause and effect, by order or through control. For Simon, leadership is a very central influence on the internal rules of interaction and communication.

Leadership is necessary to master the challenges described. In many cases a distinction is made between leadership in the sense of leading and management. Both can be viewed in a person-oriented way or in a functional and process-oriented way.

The person-oriented view focuses very strongly on individuals and their abilities. The functional and process-oriented view observes how the organisation performs, differentiates and further develops the function of leadership.

transformis takes the view that organisations are well advised to do two things. They look at the qualification, search and selection of executives. At the same time, they ensure that leadership is anchored in the organisation. Through the established communication structures, routines, processes and values, leadership in the sense described is then available as a resource.

In this way, organisations protect themselves against dependence on so-called charismatic leadership personalities who, in the worst case, seduce the organisation instead of leading it.

To secure the balance between the internal and the external perspective, the organisation must engage intensively with drawing the boundary between inside and outside. This applies all the more when markets are volatile and unpredictable. This requires people and processes that ensure that the function of fence riding is highly developed. That is exactly what is meant by leadership.

In this sense, the ability to recognise and anchor the benefits of the witches is an important core capability of organisations that needs to be established and developed further.