Our new report explains why the road to better performance starts with better leadership 

Across Australia and New Zealand businesses are lagging. They’re not performing as well as they should or keeping up with global competition. While there are many factors behind this, one of the most significant is also well within our control. It’s how effective our leaders are. The logic is pretty simple: High-performing leaders create better organisational climates. That in turn results in more productive employees and greater company performance.

Let me explain.

A company’s organisational climate is a reflection of how employees feel working for their managers. Employees who operate in positive organisational climates create better results, adding up to 30 per cent or more to the bottom line thanks to their extra discretionary effort.[1] Over time, that extra effort can have a significant impact on financial results.

If we accept that one of the best ways to drive performance improvements is by fostering better organisational climates, then our focus should be on enabling our leaders to create them. And, since how a leader leads can dictate up to 70 per cent of organisational climate,[2] making sure that managers are adept at using a variety of leadership styles is critical to helping them successfully manage the many different challenges their teams face each day.

Understanding Australia and New Zealand’s leadership problem

Unfortunately, that’s where many of Australia and New Zealand’s leaders tend to fall down. As our new report “Raising the Bar: Why Better Leadership Is the Key to Improving Performance in Australia and New Zealand” shows, 60 percent of leaders in both countries use an average of just one or two of the six main leadership styles. This and the report’s many other findings are the result of our work with more than 20,000 professionals — including over 5,000 leaders — across Australia and New Zealand.

Practically speaking what all of this means is that our leaders aren’t well equipped to deal with different situations and different types of employees. In our view, this is one of the main reasons why so many of the professionals we surveyed describe working in what they’d classify as a de-motivating environment. Making matters worse is the fact that in many cases the leadership styles that our leaders do use are the ones that tend to have the most negative impact on organizational climate over the long term.

5 steps to creating better leaders

Traditional approaches to leadership development simply aren’t cutting it. To attack these issues head on we need a better way of making sure that our leaders are adept at using a variety of leadership styles. That’s why in addition to providing a snapshot of the state of leadership in Australia and New Zealand, our report concludes with the five practical steps that organisations need to take to start turning things around. You can find them all in the full report.

The bottom line is that there’s a tremendous opportunity to improve performance in Australia and New Zealand. The key to doing so is by developing better leaders. To learn more, download your copy of “Raising the Bar: Why Better Leadership Is the Key to Improving Performance in Australia and New Zealand”.

[1] Korn Ferry research – Inventory of Leadership Styles Technical Manual, Steven Wolff and Jill Schoel, 2009.
[2] Ibid.

 

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About Contributor

Wendy Montague is a Senior Client Partner for Korn Ferry Advisory, Australia. Wendy is passionate about helping senior executives become more effective leaders. She understands the impact great leadership has on people performance, and has extensive experience in aligning people and organisational design with business strategies.

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