Common Sense in Leadership: Prague Leadership Institute Newsletter, Volume 1, Issue 2

The Prague Leadership Institute Newsletter

Developing Leaders for the 21st Century

Dear <<First Name>>,  

Pepper de Callier The goal of the institute’s newsletters is to create a body of intellectual capital on leadership—specifically, The Human Element of Leadership—and a key element of leadership is common sense.  In keeping with that theme, in this month’s issue two of our faculty members approach it from different perspectives.  Professor David Bennett begins a three-part series by asking the question, “What is a Leader and What Do They Really Do?”  Vladimira Josefiova comes at it a bit differently by addressing the lack of what she calls “Street-Smart Leaders” and the subsequent consequences of this critical deficit.  Loaded with common-sense and critical thinking, these two wonderfully literate and to-the-point articles are sure to spark thoughts, insights and dialogue.
Please feel free to share our newsletter with friends and colleagues and also, please let me know topics and issues you would like to see us address in future issues.

Take care and thanks for your time,


David Bennett

What Is a Leader and What Do They Really Do?

David Bennett
Director of Outreach, College of Business at California State University San Marcos

This will be the first of a series of three articles where I will discuss the various concepts of leadership and attempt to bring some clarification on that very elusive subject, sometimes the “flavor of the month” word called leadership.  The first article will explore the diverse topic of what leadership really is.  The second article will examine the topic of servant leadership and the third will discuss corporate culture, addressing values, ethics and trust.
What is a leader and what do they really do?  To understand the magnitude of leadership, one must first understand some facts and trivia that surround leadership.  There are well over 20,000 books and articles written about leadership most of which, in my opinion, are worthless.  I say this because some of these authors have never had the necessary experience of leading a mid to large size organization or had the enormous responsibility of leading people.  In an article written a few years ago in Fortune Magazine, only 8% of Fortune 1000 executive directors rated their leadership capacity as fair to good.  It has been said that we are a global environment of over-managed and under-led people.  Companies are continually losing their top talent to retirement or other reasons without the proper processes for succession.  By and large, executives make poor promotion decisions because of self interests, making decisions too fast, putting the wrong people in the wrong positions because the objective information is not available or they ignore it and for a multitude of various other reasons.  It is my belief that few senior management decisions are more important than selecting the right middle management with the right development plans.  A strong middle management is the heart of an organization....
Vladimíra Josefiová

Speed and Greed, or: What Gets Measured Gets Done

Vladimíra Josefiová
Co-Founder and Partner, Karakoram Partners (Mergers, Acquisitions, Buyouts)

I would like to talk about a topic that is very close to my heart, and is, in my opinion, very often suppressed in the boardrooms – “street smart leadership”. Or, how my father would put it, “Idiots will always find a way to make things complicated”. Is it then the burden of responsibility or the lack of the same that compels managers to make seemingly irrational decisions? I would argue it is the combination of both as their behavior is governed by the two most pragmatic things - money and recognition.
Who is the owner?
Have you pondered many times why this or that decision of an executive of a renowned company does not make any (rational) sense? And why it is that nobody objected to it either ex-ante or ex-post? The reason, in my opinion, lies in the widely dispersed “ownership” of those corporations. Who are those managers accountable to? A major company may be owned by hundreds, thousands or even over a million people. 
Given the current global market and percentages of households that have invested in the capital markets, the odds are, you might be one of them -a less or more satisfied owner of such a company. If things are great, you´re getting your dividends and seeing the share price rise. If things go wrong, you can either wait and hope for things to get better (the company executives will run the company smarter, the markets will not be so difficult to compete in, etc.) or you can sell the shares you own. Alternatively, you can express your dissatisfaction during the Shareholders meeting. Indeed, you can be brave, but unless you own a significant stake (a blocking minority), you will not be able to influence much if anything at all. So, what then governs the decisions made by those on the top?...
Prague Leadership Institute
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