Can authentic leadership survive the downturn?

At a time of financial crisis, the need to have confidence in institutions and leaders is even more important than usual, argues Peter Blausten. Reliability, integrity and authenticity will be especially required of our business leaders.
The significance of leadership authenticity in enhancing team and individual performance has been widely debated. Bill George’s work on authenticity suggested that its intrinsic elements are pursuing purpose with passion, practicing solid values, leading with heart, establishing enduring relationships and demonstrating self-discipline. He and other writers have found an interested audience in business leaders. Subsequently, corporations have included the theme of authentic leadership in executive and senior management development programmes, as well as on front-line manager development programmes.

As a result, there is now a greater expectation of personal commitment and “giving of oneself” in order to lead and enable teams. The quality of relationships is seen to be directly linked to the quality of leadership. Leadership development programmes encourage participants to understand themselves and their underlying motivations and then to consider the fit between the organization’s purpose and their own. But when CEOs have to take difficult steps to protect their companies in a downturn, perceptions of fit and purpose can become distorted. CEOs will need to be aware of this at all levels of leadership.

Authenticity and leadership

A great deal of attention will undoubtedly be on the performance of senior executives in a downturn, but paying attention to leadership in the front line is equally important.

Why? Because, in the context of organizational citizenship, employer brands and so-called psychological employer-employee contracts, firstline leaders still have significant influence on most of a corporation’s employees as well as on the fulfilment of customer expectations both at the point of sale and delivery.

The stakes will be higher for the ongoing credibility of corporate values and executive leadership should anything happen to undermine the conditions supporting trust and authenticity at the front line. The stakes are also high for the first-line managers themselves, who have been encouraged to create even closer personal connections with their team members.

I conducted a survey of human resource directors, asking them about the potential impact of deteriorating business conditions on first-line managers’ relationships with their team members. My sample included 10 FTSE 100 companies across retail, telecoms, media, leisure, utilities and support services. These companies operate throughout the UK and internationally. HR directors were surveyed on the greatest challenges to authentic leadership on the front line in the next 18 months. Their opinions were also sought on how critical behaviours and desired front-line relationships should be sustained in worsening business conditions.

Those surveyed reported that significant training and development programmes had been implemented over the last five years aimed at firstline managers’ leadership behaviours. These included themes connected with authentic leadership. These themes linked back to their respective corporate values statements and the definitions of those values.

The effect of such training is to engage the firstline leader in a personal and individual way. This is coupled with a caveat that, without true belief in the values, authentic leadership of high-performing teams is unlikely to be achieved. The engagement of the individual’s beliefs, rather than the more simplistic engagement of his/her services, is seen as a key differentiator in performance.

Respondents all said that focusing on the peoplecentred elements of leadership was being strongly stressed. Reasons cited ranged from teams requiring greater discretionary effort and customer responsiveness from individuals, to team members working remotely, enabled through technology. “Knowing” and “caring for” team members are two elements explicitly referred to by two respondents in their expectations of first-line managers. Other respondents expected varying levels of this kind of intimacy with team members.

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