2011 Ranking: #25
The Harvard Business School professor Rosabeth Moss Kanter is one of the 100 most important women in America according to one magazine and among the world’s 50 most powerful women according to another. There is no doubt that Professor Kanter is intellectually formidable. Her career includes spells at Yale and Harvard Law School. She edited the Harvard Business Review, helped found the consulting firm Goodmeasure, advises the CEOs of major multinationals and is an active Democrat – though her credentials are such that she recently participated in President Bush’s gathering of American business minds in Waco, Texas.
Professor Kanter’s work – which includes the best-sellers Change Masters, When Giants Learn to Dance, World Class and Evolve! – combines academic rigour with a degree of idealism not usually found in the bottom-line fixated world of management thinking. Her world view is not confined to the boardroom. Her thesis examined nineteenth century Utopian communities. Rather than leaving her youthful idealism behind, Professor Kanter now brings it to bear on the big business issues. She is a champion of social entrepreneurship as well as a thought leader in change management and globalisation.
Most recently, Professor Kanter’s ideas have been developed into a Change Toolkit, a web-based tool that helps people diagnose issues, define projects, and lead change. She explains how it works and her latest thinking on change, leadership and globalisation.
Not many leading business thinkers have embraced new technology with your enthusiasm. What’s the aim of your Change Toolkit?
I want to create web-based versions to empower people to make change more effective. I want to give these skills to everyone so that change management – essential to leadership — becomes more widely understood and practiced.
The content consists of 150 inter-linked “tools” — explanations and descriptions, action guides, frameworks, diagnostic tests, etc. — based on my work. It is about putting my theories into action. I believe this is a way to empower people — by giving them the tools to take initiative, to lead and gain confidence in their ability to innovate and then to develop still more leaders. Shared tools shape organisational culture: a common understanding and vocabulary, workspace on the web to compare notes, compare scores on diagnostic instruments, and exchange useful information. The net enables us to translate material from books and workbooks into live, interactive, exciting, dynamic action tools embedded in the daily work of people and organisations.
Do you still regard technology as a force for good?
Yes, I have enormous hopes. Already, there have been tremendous improvements in education and many businesses are more efficient internally. In healthcare physicians and providers can be empowered through having less paperwork, the ability to get information faster and so on.
The potential of the technology remains great but we’re in a period where companies aren’t spending money and we’re still in the era’s infancy. We lived through a period of peace and prosperity then we’ve had some crises and challenges to some of the assumptions of Western capitalism. Now there’s a cooling-off period, but new technology is fundamental and will make a difference.
With an abundance of crises and challenges do we have unrealistic expectations of our corporate leaders?
Yes, we do if the expectation is that a single leader can do it all. But it is also interesting how much a single leader can set in motion. In turnarounds it is striking how much fresh leadership can accomplish by unlocking talent and potential which was already there in the organisation but was stifled by rules, regulations and bureaucracy.
I wish there were more corporate leaders stepping forward to address the root causes of accounting problems, not simply responding to the rules requiring honest numbers, but talking about the responsibilities businesses have. True leadership means acting before a crisis gets out of hand and not simply being defensive.
Why don’t they?
Unsustainable expectations for speedy and continuing growth, for quarterly earnings increases put pressure on companies to get there by all means. Leadership also involves setting realistic performance expectations.
So we need to re-think our understanding of leadership?
Most attempts to understand leadership — in an era in which everyone says we need more leaders, we need better leadership, the problem is a lack of leadership — deal with individual character, drive, experiences and personality characteristics or they deal with actions – what do leaders do, how to you create a vision, mobilise a team and so forth.
But if there’s character and actions, there are also circumstances. I began to think of this at greater length after September 11, 2001, when New York City Mayor Rudy Giuliani became a hero. That was a very good example of rising to the occasion, of someone who, whatever his character, whatever actions he engaged in before, the circumstances made it possible for him to exhibit a level of leadership which was thought of as exemplary.
But you can’t exercise control over circumstances.
You are not always born at the historical moment when you get to create a new country. You’re not always living in a time when you can show that your actions made a real difference. Leadership is a combination of being born in the right place, being handed the opportunity, the character of the person, the support systems.
Is the western heroic view of leadership still appropriate?
If we think of the western notion of leadership as cowboy leadership, the tough heroic stuff, it is no longer very appropriate. My view of leadership is probably more Confucian than cowboy.
The best leaders have somewhat universal characteristics. Leaders are more effective when they are able to create coalitions, develop and use a support system, encourage, listen and develop other people. Those sort of attributes tend to transcend cultures.
During a lecture tour to South Africa in March I thought about Nelson Mandela’s achievements. He is someone of enormous character but I was struck by the support system surrounding him. .
In terms of people?
Yes, in terms of people, in terms of a movement. Nelson Mandela comes from a communal tradition and he is very tough but also very consensus oriented.
His ability to exercise leadership came about because his followers paved the way, and he in turn empowered them. I have always been interested in empowerment — what frees people or encourages them to exercise whatever their natural abilities might be?
How can and should organisations respond to the challenge of rising expectations?
First they must innovate, improvise quickly. This is a continuing issue. Second they must work effectively with external partner networks. Third they must be able to build a sense of community throughout the entire enterprise. Fourth, they must invest in people, not just financially but in the quality of the job and their ability to exercise leadership. Finally, there is corporate citizenship, engaging in activities which are seen as improving the state of the world the company lives in; not simply obeying laws but improving the state of the world.
The final ingredient is essential for employee loyalty and the nature of the brand. Consumers increasingly ask who is this company, what does it stand for, so that’s an important piece of the strategic agenda. Corporate citizenship is a means by which a company becomes embedded in a local community, moves from being one of “them” to become one of “us”. Companies which have become part of the fabric of the local community are viewed very positively. People are very aware what companies are or are not doing for their community and country.
There’s a lot of data that shows that countries which engage in trade by and large have had incomes rise even for people at the bottom. It’s just that the gaps are so wide everywhere. My current research suggests that multinationals play a positive role in developing countries by raising certain employment standards when they are actually producing in the countries to sell in those markets; then they have a stake in social and economic development.
Are you optimistic?
I always have a degree of optimism though I think we’re in a rough period in which things could get worse before they get better. Right now we have the threat of terrorism, military action and tremendous tension; this has a dampening effect on countries and businesses which have no direct involvement. It creates fear, reduces investment, increases costs and slows down the movement of goods and people.
Then we have the disclosure of corporate ethical lapses and mistakes, which creates crisis. A lot of people have lost a lot of money. Trust in institutions is low. If people don’t have trust in the honesty and ethics of leaders that’s a problem. In addition, there is the weakness of the economy.
This comes to one of my ultimate definitions of leadership — examining root causes and system issues and not just superficial tinkering. Trying to patch over a bad situation with a little cosmetic treatment is like putting lipstick on a bulldog. That’s the wrong way to deal with a deteriorating situation. We can pretend everything is all right, except for one or two bad actors, or we can look more deeply at the underlying system, at how we can fix the entire system. Do we need new structures, dramatically different models? That’s what leaders should be doing, taking a deeper look and offering new solutions rather than simply cosmetic responses.
Turnaround CEOs who come in to cut costs but don’t re-think the business model or assumptions are making cosmetic change; they don’t last. But if they re-think traditional practices, challenge underlying business assumptions, they create sustainable change. Of course, systemic change takes longer.
We’re in a situation where turnarounds and quick fixes aren’t enough. There’s a sober mood everywhere. But, in the long run I am optimistic. I believe that if corporate citizenship and social entrepreneurship continue to flourish then we’ll find new solutions.