By IAN ROSS
What makes an effective leader is a question that constantly swirls inside Bryan Poulin's head.
The professor at Lakehead University's faculty of business administration says the best leaders and top managers are persistent, set a standard for others to follow, and recognize and reward the hard work of others. There's also the sometimes contradictory qualities of humility and will that are important to leadership success.
"If only we had people with the ability to communicate like a Bill Clinton or the integrity of a Timothy Eaton," says Poulin.
Pick the right person with the right skills and intangibles to lead your company into the next generation and the financials will take care of themselves.
Poulin co-authored a paper entitled "Leadership and Succession: The Challenge to Succeed and the Vortex of Failure" published in the August 2007 issue of Leadership, an international peer-reviewed journal.
Poulin, who teaches strategic management and principles of entrepreneurship, found in his research of companies that two distinct leadership styles, attributes and characteristics emerge among businesses that either succeed or fail.
Socialized leaders seek to make their lives and others more fairer and more workable. They serve the interest of others, develop and empower followers.
Personalized leaders look primarily to their own self-interest, exploit others and reject those who don't follow their agenda. The latter can spell doom for a company.
Poulin says it's the will, passion, drive and dedication to long-term thinking, instead of achieving short-term gains, that means the difference between success and failure.
The former construction and consulting civil engineer has 30 years experience in business and academia. He has travelled to New Zealand, Australia, India, Nepal, Bhutan and studied many companies in South East Asia. Poulin is also a chronicler of Timothy Eaton and his management style.
The T. Eaton Company was one of Canada's greatest retailers. He rewarded employee contributions with shares and benefits unheard of in the late 19th century including a five-day work week and an eight-hour working day.
The company's success was built on value, service, trust and a money-back guarantee. After Eaton's death in 1910, the series of succession decisions became narrower in views and values. By 2000, Eaton's ceased to exist, gobbled up by Sears for $60 million.
"His relatives missed the points," Poulin says.
Selecting successful CEOs and top management depends upon their interest in what they're doing, how
good they are at it and how much they invite other people's ideas into the process and involve them in the business.
The demise of the family-owned retailer underscored the issue of how important leadership succession turned out to be.
Another of Poulin's favourite case studies is Nucor Corporation, one of the largest "mini-mill" steel operators in the U.S. and a large recycler of scrap steel.
Originally founded by Ransom Olds, of Oldsmobile fame, it evolved into the Nuclear Corporation of America, a holder of seven companies. But its only profitable business was with Vulcraft steel joists. After filing for bankruptcy, the management tag-team of Ken Iverson and Sam Siegel concentrated in steelmaking and purchased an electric arc furnace, which was cheaper than traditional steel blast furnaces.Eventually they purchased Canada's Harris Steel Group in 2007.
The leadership team of CEO Iverson and CFO Siegel are a prime example of social and shared leadership. They also invited other people for answers.
Employees who shared those values were rewarded with career advancement, good pay and benefits with the knowledge that the company was fair, not greedy. Shareholders earned high returns and suppliers enjoyed loyalty.
In his research, Poulin says Siegel was too modest to talk about leadership, but would rather talk about good management and being fair. The problem Siegel saw in large corporations is "plain and simple greed."
Unfortunately, the concept of sharing the wealth is "far and few between" in many large corporations.
Both Eaton and Iverson-Siegel were focused on what they were doing, did what they were best at and looked for ideas from other people.
With small businesses, Poulin says, entrepreneurs try to do things better. "It's determination of the will. In terms of convincing people, the smaller, it is the easier it gets."
Often, large corporate boards and search committees can't decide who will lead them. Small companies know exactly what they want in a future leader.
"That's why innovation and more good ideas happen in small companies."
