In association with Unilever, MT gathered eight business leaders to discuss whether leaders are born or made.
On the panel were: Andrew Saunders, deputy editor, MT; Nigel Nicholson, professor of organisational behaviour at London Business School; Leena Nair, SVP, leadership and organisational development, Unilever; Caroline Plumb, co-founder and CEO, Fresh Minds Group; Peter Earl, CEO, Rurelec; Srikanth Iyengar, head of UK and global head of sales, Infosys; Andrew Peters; divisional director, Siemens Industry; Andrew St George, St George Partners and author of The Royal Navy Way of Leadership; and Doug Baillie, chief HR officer, Unilever.
Andrew Saunders: It's axiomatic that the best leaders - whether in business, politics, sport or whatever it may be - are born to the task. Cometh the hour, cometh the Steve Jobs, Marjorie Scardino or Nelson Mandela. But is this really the case? For every natural born entrepreneur or chief executive, there are many others for whom the skills and aptitudes required for leadership have had to be learned. Add in the challenges of keeping the talent pipeline fully supplied in high-growth emerging markets and the case for developing your own people becomes even more compelling. So are leaders born or made? And why do we need them?
Nigel Nicholson: You can have leadership without leaders. A flock of birds rising from the ground doesn't need to have a leader. But we do seem to have a preference for people telling us what to do. The problem is that we've elevated leaders to this iconic status. There's a danger of saying that every organisation needs a charismatic leader. On the whole, they serve society rather poorly. Often, we want someone who can acknowledge flaws and interact easily with us.
Leena Nair: There are times when leadership comes out of all of us. A few years ago, some of my team and I were caught up in the terrorist attack on the Taj Hotel in Mumbai. We were stuck inside, debris was falling and people were screaming. But a young member of staff rose to the situation and took care of us. This 22-year-old woman guided us through the hotel and led us to safety. Nothing in her training had ever taught her how to respond in a situation like that, but she was calm, composed and unflappable. The way she exerted her authority was amazing. She showed me a lesson in leadership - you can lead in the moment, with your heart.
Andrew Saunders: You don't know what you're going to do in a situation like that until it happens, or who will emerge as a natural leader.
Caroline Plumb: When I started Fresh Minds, we were always driven by achieving growth and getting close to our customers. It was leadership by default in many ways. In a start-up, you can get away without management but you need leadership to understand where your future is going to be - and you need to adapt all the time and persuade early employees to follow you. If you don't have any answers when you first start, ask lots of questions.
Peter Earl: For me, the key question is how you empower people who are based abroad into making decisions that don't mess up the rest of the organisation. I run a relatively small company called Rurelec, which was the first power company to float on aim. We own and operate power plants in the southern part of Latin America. How do you manage and lead a company when you are about 8,000 miles away from most of your assets and people?
Srikanth Iyengar: Organisational structure can only do so much - how leaders get the message through to everyone is key. At Infosys, we believe there is no limit to the amount of communication you can do. When we have a success in the company, we spread it. There is nothing like celebrating success, especially when the external economic environment is uncertain.
Andrew Peters: Most leaders are very self-aware, but junior people don't necessarily have that self-awareness. At Siemens we put a lot of emphasis on authenticity. Leadership is important but, on the other hand, if your fundamentals aren't there and you don't build a sustainable senior team, you're going to struggle. There are not many businesses that can succeed in keeping customers happy at the same time as expanding the business.
Andrew St George: The Navy believes that everyone has leadership qualities to some degree. It does terrifyingly realistic exercises - one involves a room filling with water to simulate a sinking vessel where you only have a few seconds to escape. In such desperate situations you find that one or two individuals will emerge and get the job done. The lesson is, anyone can lead - it's usually the first person to speak up or the first person on the scene. I don't think the commercial world puts people under the kind of pressure that allows them to reveal who they really are.
Caroline Plumb: The world is getting busier and noisier. Content is just becoming ubiquitous and people are bombarded all the time. The only thing that will transmit is stories. So the ability of leaders to tell stories and to create and share memorable messages is increasingly important.
Srikanth lyengar: People relate to different kinds of stories. Infosys encourages lots of its people - and I don't mean just the top 100 leaders - to tell their personal stories. The average age at our company is 28, so we have a fairly young workforce. They want to communicate by talking to people and sharing experiences. An email would never have the same effect.
Doug Baillie: Everyone can be a leader, that's what underlies the Unilever management development programme. You've just got to find ways of unlocking it. The problem for organisations is creating a working environment that allows people's richness and diversity to come through. At Unilever we focus a lot on leadership development programmes - and we go right through the organisation. We start at the bottom and go right to the top. Unilever takes on around 800 graduates a year, and they start developing leadership skills the day they walk into the organisation. Probably the greatest leaders are the so-called unsung heroes, the people who put the team above their own self-interest. These are the leaders of the future.
Nigel Nicholson: There's an incentive problem. We often measure and reward people for getting the numbers right, rather than rewarding them for managing relationships.
Doug Baillie: The job of a factory manager is not just to operate machines, it's to lead the factory. I take it as a given that all our senior leaders at Unilever will deliver the results. Hitting number targets is easy. But it's about how you manage people and what legacy you will leave behind.
Leena Nair: Recently, I talked to young people from Indonesia, Brazil and China. I asked them what they expected from the leader of the future and their answers amazed me. The qualities that came up were humanity and compassion. They also wanted leaders who had the ability to put staff at the centre of what they do. They want leaders who aren't so charismatic - they want people who are humble enough to admit they don't know all the answers.
Nigel Nicholson: Events like the Arab Spring show that parts of the world are looking for a different type of leadership. People living in an old world are confronted with a new world they can't cope with and it leads to a sort of revolution. As people become more educated and self-willed we have to say they need a different type of leadership.
Caroline Plumb: Agility is one of the crucial elements of building for the future, especially for a start-up. That combined with a sense of enduring values and a culture that lasts for the long term. Making mistakes is part of the process.
Andrew Saunders: So how do you lead in this disconnected world, where your teams might be on the other side of the world and you have to make your presence felt and lead from afar?
Peter Earl: It comes down to analysis and communication. I first realised the truth about managing a business on the other side of the world when we won our first privatisation tender in 1996. We were taking over a power plant in Kazakhstan and we had partnered with a US company that had never been involved in anything outside its home state, never mind half-way across the world.
At the last minute, this company pulled out. In the space of 48 hours we had to come up with a management plan to complete the takeover and find out how to operate a plant with 1,400 employees that had just emerged from Soviet times, complete with a huge statue of Lenin outside.
We did it, but we had to go in and lead 1,400 people who came from a very tight-knit community in the middle of nowhere. They were very wary because they had been told everything in their community would be closed, because that's what happens when a state organisation gets privatised. As a result of being humble and listening to them, we gained their trust. The trick is to work with the staff, don't fire people too quickly -because you won't immediately know who the best ones are - and let the leaders emerge. As a result, the worst-performing power plant in Kazakhstan became the best- performing one.
Andrew St George: Knowing your people and looking after them is crucial. If you get that right, operating something long distance becomes possible. Great leaders in any environment will walk the patch. They will be out and about on their feet, listening and learning about their people. That way, you're allowing leaders to emerge because you understand them.
Nigel Nicholson: The role of the leader in this context is to see what other people can't. It's to stand in another position. As soon as people see the situation in a different way, they will act in a different way.
Caroline Plumb: How do you manage accountability from afar? You see some CEOs or senior teams forced to resign over really quite operational issues. How far can people take themselves out of operations and delegate? Should people lose their jobs for a decision that was made in a country 8,000 miles away?
Doug Baillie: As a leader, you take risks by empowering. I'm prepared to be accountable for any risks if one of my team gets something wrong. Because I hope that they will make mistakes and learn, but also that they will never make a catastrophic one.
Andrew Saunders: Can technology help you manage a team from a distance?
Nigel Nicholson:You need face-time. People have to smell your breath. Technologies are getting smarter but there's something irreducible about being in the room with someone.
Peter Earl: You have got to walk the floor. It's not just about talking to the people who are important to you. You need to talk to everyone else and find out how they interact. If you're there, your antennae will pick up any problems.
Andrew Saunders: What about social networking? It's a powerful tool but it can be dangerous if it is used thoughtlessly.
Srikanth lyengar:I don't think leaders have a choice but to use social networks. People want to talk to you; they want to get a response. If your leaders sit outside this stuff it sends the wrong message. You've got to be there, you've got to respond. But you've got to trust leaders to use their judgement on what's appropriate to say and what's not.
Andrew Peters: Social networks can be a useful tool in explaining to your staff what you've been doing all week. It can then create some interesting discussions about who you've been visiting and why, and can allow your employees to understand more about the business.
Leena Nair: It's interesting to see what the power of social networking can do to engage and unlock the future of the organisation. But I'd also like to underline authenticity. People know when leaders have written a blog themselves and when someone else has written it.
Caroline Plumb: Yes, if leaders are going to tweet or write a blog, they've got to do it themselves. And they have to have something to say. We are moving towards an age of hyper-customisation and absolute transparency. Whether people like it or not, it's coming. You can try to build walls around it but that won't hold it back. We've got to learn to operate in an environment where this is happening, and to teach organisations how to get the most out of it.
Nigel Nicholson: You mustn't confuse networks with relationships. People can have a false sense of being members of a community. You can do great things with networks and have a huge impact, but the idea that you can build trust in a social network is a dangerous one.
Leena Nair: Ten years from now, people will expect different things from a leader and because of our management development programme, we are ready for that. So we need to start creating the right sort of leaders now. We also need to think about how to get more women in leadership positions.