Don’t Think Leadership Matters? Ask Goldman Sachs

There has been a lot of buzz this past week about an opinion letter written to and published in the New York Times last week. The letter was written by an executive at Goldman Sachs who was resigning from his position and from the company.

I know it’s easy to dismiss as a complaint from a disgruntled worker – and maybe it was just that. However, isn’t that fact in and of itself enough to say there is a leadership hole at Goldman Sachs?

The impact of effective leadership

My conclusions of the article are these:

1. As much as good leadership can help propel organizations forward toward their mission, bad leadership can ruin organizations.
2. Bad leadership can mean many things but the roots of bad leadership are not complicated. The roots of bad leadership are:  Lack of values or focus on the wrong values; Inability to establish and communicate the mission or the organization.

While we have seen some great leadership during turbulent times, we cannot ignore the fact that some practices and behaviors can have a detrimental effect on your team’s morale and make an already tense situation worse. It is important to be mindful of these aspects in order to ensure employee wellbeing.

In the case of Goldman Sachs (if you believe the article), the leadership was bad because of both these issues. They did not have the right values and they were not focused on the right mission. In fact, it appears they may have been focused on the wrong mission – their own personal ones – not that of the organization. This is another good point to add to how bad leaders teach good leadership. 

We have discussed several times the behaviors of great leaders. We can agree that good leaders never put their own personal agendas before the mission of the organization they lead.

 

What you can do

Though we have talked about a few good leaders, their motivations and struggles in the past. I’d like to bring to the table another tactic that I recently read about hiring new employees and office politics that I thought it was worth sharing.

In an interview with Dinesh Paliwal, the CEO of Harman International Industries, an audio equipment manufacturing company. (Think Harman/Kardon speakers)  A few leadership points he made were very interesting.

First, a technique he uses when hiring new employees – he takes them to dinner with their spouse and his.  In a social setting he gets to see a few key things:  1.  How the prospective employee and his spouse interact with each other; (Seeing how people treat other people when relaxed is very telling) 2.  If the prospective employee answers some of the same questions asked during their original interview the same way when answering in front of his spouse.

This is an interesting technique, I hadn’t thought of before.  You clearly can learn much about a person by seeing them in social settings (when the guard may be more readily let down).  Additionally, seeing how they answer some of your interview questions in front of their spouse (and even how their spouse adds to the answers of those questions) could be quite revealing.

What about Office Politics?

Office politics exist in every organization.

Mr. Paliwal’s annoyance with office politics and the way he deals with it – head on – is also refreshing.  He recognizes politics are inevitable but they are also damaging.  So, he tells his people to “kill” politics in all instances and he doesn’t participate when tempted with gossip or office politics.  In leading this way, by example, he reduces office politics significantly and therefore, has a healthier organization.

I think it’s also a great way to detect and teach others about communication, kindness and education and Mr. Paliwal explains it beautifully during his interview.

 

I know we talked about a different side of leadership today but I think it’s such a complex subject it needs to be discussed in all its ways. What did you think of both Goldman Sachs and Mr. Paliwal articles? How do you approach these subjects in your company?