How to PractIce Creative Leadership

There is a need for creative leadership solutions for today’s generation of managers. The very old school method of thinking that staff are all cattle and each needs their own internal personal ROI needs be revised. Just ask anybody who works in a Amazon distribution centre. This internal ROI is a lot of stress on anybody (and is a cause of staff turnover) as we all have to do more for less now. How can a company avoid this potential mess.

Based on the research of Toronto-based organizational innovation and cognition expert, Dr. Brett Richards, every organization is a cognitive system designed to achieve a specific purpose. By measuring the cultural mindset of the organization as a whole we can pinpoint its potential to effectuate that purpose through innovation and agility in the face of change.

We can do this by learning the mindsets of a leadership team to understand what may be constraining growth. Dr. Richards has shown through numerous organizational applications that understanding, and indeed measuring, an organization’s mindset is critical, as it represents not only how an organization thinks, but how it feels and chooses to respond to calls for change.

Richards’ work shows that companies across verticals that score in the midrange on overall organizational mindset on the Organizational Growth Indicator (OGI) have a potential growth ability (revenue, profit, share price, and other KPIs) of 1–9%. Those who score in the next tier up have the potential to grow 10–24% and top-scoring companies can grow over 25%. However, companies that score in the lower ranges stagnate or experience loss. The mindset-to- growth correlation has proved out in over 85% of business applications . To learn more about the OGI indicator here

 Explore Mindset Alignments and Misalignments

A distinct relationship exists between organizational mindsets and a business’s ability to recruit and retain top talent. High performers are attracted to growth-focused organizations. The converse is also true: high performers leave organizations that are not interested in developing their people (Richards, 2019). During an interview with former senior equity trader Melissa Aaron*, she related a typical story on why employees suddenly leave good jobs due to mindset misalignment.

Melissa was a top-level trader at a global top ten investment bank. Recognized for her expert risk management skills and for driving revenue to the firm, she built a solid book of client relationships and alone brought in tens of millions of dollars per year. However, she left the firm after four years and was hired as Chief Operating Officer at a boutique American investment bank. What happened?

A trader’s job is narrow and deep, and Melissa—a subject-matter expert—settled into the upper echelon of trading expertise. Yet, as a voracious learner who values personal growth, she knew it was time to expand her skills. As a start, she became involved in recruitment and mentoring at the firm.

She soon realized that her experience trading at several different firms gave her a unique perspective to find business process innovations to improve the trading desks’ efficiencies. The bank’s CEO even invited her to a meeting to share her insights, but her direct managers saw it differently: Melissa’s ideas were dismissed. Though her trading was still top-notch and her revenue numbers never wavered, her performance review came with a disappointing surprise.

 Essentially, Melissa was told to sit in her seat, trade her orders, and singularly focus on driving revenue.

It became evident that the organization did not value her personal growth and career expansion. Melissa’s experience is commensurate with a Facebook employee survey, which revealed that employees “left when their job wasn’t enjoyable [sic], their strengths weren’t being used, and they weren’t growing in their careers” .

Facebook and investment banking are industries apart, yet they both face this universal employee retention issue.

When Melissa left, the bank lost millions in revenue. Those in investment banking know that when a trader leaves a firm, his or her book of business, built on careful cultivation and relationships, tends to evaporate. This is not Melissa’s story alone. She reports that she has personally observed many mid-level and senior-level employees in investment firms leave their jobs due to lack of opportunity for career growth.

You might not work at an investment bank wherein the departure of one employee would result in a direct loss of tens of millions of dollars, but you’re likely losing relative dollars when employees are not supported to work to their fullest capacity, become dissatisfied, and leave. Studies in yet another industry, hospitality, have found that even the departure of one hourly employee can cost between $4,300 and $14,500 (numbers adjusted for inflation), including lost revenue, lost management time, lost productivity, and recruitment costs (Gustafson, 2002).

Develop a Productive, Satisfied Workforce

 While there are many factors at play in any employee-employer relationship, Melissa’s experience illustrates the need to ensure that your organization is not inadvertently pushing high- potential employees out the door. The following are the first two steps that will help your company develop a satisfied workforce

1. Practice Creative Leadership

Within Richards’s organizational mindset structure, there are eight measurable orientations: creative, strategic, innovative, learning, collaborative, connective, cultural, and leadership. Two of these orientations, innovative and creative, speak to one dimension of the Melissa story that is pushing high-potential employees out the door.

If organizational mindset had been measured at Melissa’s firm, her direct bosses would likely have scored low or in the midrange on the innovative and creative orientations, the dimensions that indicate readiness for growth. Her firm’s CEO likely would have scored higher, which reveals a disconnect between the highest and middle levels of leadership. A misalignment of values leads to slow growth or, as in this case, material loss of revenue and intellectual capital for the organization.

Creative leadership values personal learning and growth in all team members. Similar to transformational leadership, it is based on principles derived from the academic science of creativity. Dr. Gerard Puccio, leading creativity scholar and one of the foremost experts in creative leadership, wrote that “leaders must not only rely on their own creativity but must also be adept at facilitating the creative thinking of others, which implies that they possess the ego strength to admit that they do not have all the answers and the open-mindedness to entertain and support others’ ideas” (Puccio, Mance, and Murdock, 2011, p.10).

In the case of Melissa, the team culture set by her direct managers was characterized by egotism, inflexibility, and closed-mindedness. Management was top-down, focused singularly on profit without regard to career growth. This organizational mindset resulted in a long-term loss of revenue. Conversely, managers who score high in the innovative and creative mindset orientations are inclined to ask their employees about their personal goals and help them design career paths. They understand the importance of long-term learning and growth, even if it breaks the traditional mold.

2. Evaluate Your Evaluations

Performance evaluations were a major problem in Melissa’s initial firm. There was one metric, and one metric alone: revenue.

Investment banking is not unlike most industries, wherein the best person at the job is promoted to department head. The best salesperson is often promoted to head of sales, the best designer promoted to head of design. In Melissa’s division, the boss was the best trader. Yet, the best trader is not always a good manager. Managers were tasked with maximizing profit on the desk, not developing people.

The extent to which an organization is able to grow and develop its people relates back to metrics. If career growth and development are not prioritized as key competencies in performance reviews, they are not likely to happen. This disconnect again ties into corporate mindset, signaling a misalignment of values and undermining growth. Melissa’s managers wouldscore low on Richards’s leadership, culture, and learning dimensions of mindset. Again, this is an indication that the company is not poised to grow in the long term. Those fundamentals played out as expected with Melissa’s departure.

Specific competencies that have been added to performance reviews to help align corporate mindset for learning and innovation include Learning & Growth Focus, Talent Leadership, and Entrepreneurial Mindset to name a few examples.

Achieve a Healthy Corporate Mindset

The creative leadership of Melissa’s new direct manager in her boutique investment bank provides freedom for Melissa to use her best thinking. She appreciates the manager’s openness to her ideas and opinions, and the willingness to respectfully debate ideas and even create a change of mind based on her insights and analysis.

Freedom, respectful debate, idea support, and trust underlie Richards’s eight corporate mindset orientations that support creative growth at work . These characteristics define sustainable culture for innovation and are a far cry from the egotism and territorial thinking that dominated in Melissa’s initial job.

How does your own organizational mindset align with these key orientations for growth and innovation? The answer can help you achieve major revenue gains and avoid imminent losses of revenue and intellectual capital.

Author: Kathryn P. Haydon, MSc is an is award-winning author and educator who helps trains leaders and teams to apply the science of creativity to grow revenue, retain talent, and add innovative value in the face of change. Her clients span industries, from Bosch and ZipRecruiter to banks, accounting firms, and educational institutions.