Why empowerment doesn't empower: the bankruptcy of current paradigms

Business Horizons, March-April, 1994 by James A. Belasco, Ralph C. Stayer

The president shifted nervously in his big chair. His youngish face - belying his 50ish age - was creased with worry. His was a most admired company. Mentioned frequently in business magazines, his stock sold at healthy profit-to-earnings multiples. With his Ivy League training he was a leading spokesperson for American business. Yet now his eruditeness had deserted him.

He rose, strode to the window, and peered out at the bucolic setting. "Not on my watch," he said to the huge oak outside his window. "This can't happen on my watch." After an eternity of shuffling his feet and clasping and unclasping his hands, he whirled and faced me, steel flashing in his eyes. "I've got five years to retirement. What can I do to make these five years count?"

The challenge was daunting. The company, despite its favorable press, was failing badly. It had lost market share in every single phase of its business. It was significantly late in several new product launches. Its cash cow was under attack by the Japanese. Despite its cash hoard and dominant market position, the company was in serious trouble. He saw with crystal clarity the potential danger if the business did not change - radically - now. The unthinkable could happen on his watch - and he did not know what to do. Nothing in his previous experience or training had prepared him to deal with this situation.

This president's problem is all too familiar. Though he sat in the CEO's chair, he was powerless to accomplish the changes he knew had to be made. He saw clearly what had to be done. The management mantra of the 1990s was familiar: teamwork, better quality, improved service, faster time to market. He knew them well. He preached them to anyone who would listen. Yet he was unable to make any of these vital outcomes occur in his organization.

It was not for lack of trying. In the last six years he had instituted programs designed to stimulate quality, customer service, and teamwork. He had slimmed down the organization, reorganized functional groups into product/customer focused units, and reduced the number of management layers. Yet he continued to lose market share, competitors continued to beat him to the market, and he had lost 50 percent of his market value. He just couldn't make his people do what he knew had to be done.

The leader presumably sits at the pinnacle of power. At least that's what we are led to believe. The corner office is the symbol of authority in America. Yet read the business press and feel the pain and anguish of so many executives as they are unable to make people produce the changes they know are essential to their organization's survival.

We know how it feels. We've been there through the long sleepless nights. One CEO said, "It's a cruel joke. I work a whole lifetime to make it to the top. Now,' I say to myself, I can finally do things the way I want them done.' Only now I discover that I have less ability to do things than in any other position I've ever held. It's a cruel joke." The power vacuum in the corner office is an epidemic. It undermines ability to compete in world markets. It deepens recession and flattens growth. in the long run, it is fatal.

Why does this power vacuum exist at the pinnacle of power? The single biggest reason is the obsolete leadership paradigm that robs leaders of their effectiveness. Under the current paradigm leaders are responsible for the performance of' their people. They fix problems - including people problems. They answer questions. They make decisions. They do things to the organization and the people in it.

You've probably read it and heard it a million times. Leaders plan, organize, command, coordinate, and control. That's the current command and control paradigm. It's found in every management textbook, taught in every college classroom and seminar room. You see it practiced in almost every organization. It is "conventional wisdom."

Take vision, for instance. Leaders are responsible for crafting a vision, implementing it, and empowering their people to use it. It is this paradigm of leader responsibility for other people's performance that, given today's circumstances, guarantees organizational failure.

Our experiences in researching high performance organizations, running our own companies, and helping other people run theirs demonstrate that the leader's job is to make people responsible for their own performance. Kotter and Heskett (1992) report a significant relationship between economic performance and culture that emphasizes personal accountability to customers. Leonard-Barton (1992) cites the experience of Chaparrel Steel in managing so that individuals own the responsibility to solve production problems. Osborne and Gaebler (1992) argue that government can be reinvented by making people assume responsibility for their own performance serving their citizen-customers. Much of the work of Lawler (1992) leads in the same direction of self-management; Ouchi (1978) and Walton (1985) have presented a similar argument. There is considerable evidence to support this new approach to leadership. One of the consequences of this revised leadership paradigm is that it significantly alters the behavior of everyone in the organization.