In my opinion: Julie Baddeley, director of the Woolwich and an Institute of Management companion, argues that the new economy demands even stronger leaders

In my opinion: Julie Baddeley, director of the Woolwich and an Institute of Management companion, argues that the new economy demands even stronger leaders - In a world where it seems possible to become a paper millionaire with little more than a new idea

Last Updated: 31 Aug 2010

In a world where it seems possible to become a paper millionaire with little more than a new idea, an entrepreneurial attitude and a good publicist, it's tempting to dismiss the traditional concept of leadership as old-fashioned. I take the opposite view - that in this uncertain world the need for strong leaders is greater than ever.

The driving imperative is the speed of change that is engulfing us all.

Whereas competitors can enter the market and rise to astonishing values in months, if not weeks, we who lead more traditional businesses have to make the most of our infrastructure to create lasting shareholder value, using our scale, brand, fulfilment capability and staff talent. It's not just about starting up a new company called

It's about changing the whole way we do business.

A key part of this is attracting and retaining the right people. We may live to regret the fact that we seem to have spent the past two decades encouraging people to believe that retirement at 50 is a good thing as we find ourselves competing for a shrinking population of skilled young people. Mobility and flexibility will be more important to them than stability and security, and they will be attracted by opportunities that are not dragged down by tradition and outdated HR practices and that offer the prospect of fast-earned riches.

For traditional employers this new paradigm means that salaries alone will not be sufficient to retain the best. This is where leadership will make the difference between the winners and the losers. There will still be a role for good management - to ensure that goals are set, programmes are managed, risks are controlled and people are organised. But, it is leadership that gives people confidence and conviction to go for ambitious goals; to keep their heads when share prices are fluctuating and competition is mounting; and to believe in their organisation's future when they hear stories of people making vast wealth in technology-based IPOs.

Leaders who can paint a picture of the future to which people can sign up, knowing the role they will play in delivering that future; who can create a climate where everyone is able to achieve their potential; and who can coach their colleagues and senior managers to inspire people and speak with a common voice - such people will attract top-class talent to their organisations and keep it there.

The good news is that leadership is not rocket science. Many of the qualities and behaviours attributed to 'natural' leaders are actually the result of learning to do a few basic, old-fashioned things consistently. Consistency between words and actions, an open attitude to communication (including receiving bad news in time to do something about it), and empowering individuals to make mistakes on the road to success are all techniques that can be learned as managers and perfected as leaders.

These skills are most visibly needed when an organisation has to deal with change. And we all need to deal with change. It is no longer sufficient to be able to predict market trends and set strategy accordingly. The winning companies will be those that adapt fast and exploit new opportunities, not those that are best at guessing the future.

All of us who have been involved in major programmes of change know that people find it hard to give up old ways of doing things. And the longer the corporate memory, the harder the task faced by those who have to lead that change. At the Woolwich, for example, we are transforming a traditional, largely branch-based savings and mortgage business into a personal finance provider, delivering services to customers across a raft of integrated channels, of which the high street branch is but one.

This has involved the leadership in winning staff support for an ambitious strategy involving highly innovative technology, fundamental changes to behaviour and culture, reorganisation around customers rather than products, and massive change to back-office processes. And it's happening very, very fast. Even three years ago most of our staff would not have foreseen that customers could do their banking with the Woolwich using a mobile telephone - but they can.

Our success so far in implementing change is largely down to consistency of message, without being inflexible. If an organisation has really bought into the strategy it is working towards, having to change course a little because of unforeseen circumstances doesn't rattle people so much. In our case, we have presented the overall vision of developing a customised service, Open Plan, that offers integrated products via whichever channel the customer prefers, supported by an efficient automated back office.

The fact that the detailed plan sometimes has to change doesn't then faze the staff. They're still working towards the Open Plan vision.

Those of us who have spent time studying organisational culture know that several ingredients make up the context in which people operate.

There are the structure and reporting lines, the reward and performance management system, the way decisions are made, the stories that are told and the way promotions happen. But of these it is the style of leadership that is the most influential. And in our current business-world-turned-upside-down, we need good leaders more than ever.

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