Jeffrey Pfeffer

For literally decades the world has seen books, blogs, Ted talks, executive development efforts, conferences, and similar activities—some estimates place the size of the leadership education and development budget in the U.S. at $20 billion annually.  Nonetheless, almost every piece of evidence—on job satisfaction, trust in leaders, employee engagement, leadership success, the efficacy of leadership development efforts—shows persistent failure and problems with leader tenures getting shorter and things getting worse.

Why?  And more importantly, what might organizations do to fix the ongoing crises in leadership?  This book takes on the simplistic nostrums that have beset the leadership industry and offers evidence-based, practical suggestions for enhancing both personal and organizational success.

Even as companies bemoan high health care costs and the productivity lost from sick and absent workers, and even as employers institute policies to encourage their employees to practice healthier lifestyles, many work organizations have management practices that sicken and kill people and drive up health care costs in the process.  Stefanos Zenios, Joel Goh, and I estimate that there are more than 120,000 excess deaths and that 10% of health care spending in the U.S. result comes from management actions that harm people’s well-being and do not positively affect organizational performance.

One important reason why per capita health care costs are higher in the U.S. than in other countries with no better—and in many instances worse—health outcomes is because of differences in the prevalence and cost of harmful management practices.

Just as organizations increasingly focus on environmental sustainability as part of their employee and customer branding, to be socially responsible, and to save on the economic costs of waste and pollution, there are things employers can and should do to enhance human sustainability and cut down on social pollution, waste, and excess costs.

Companies have spent millions of dollars building intranets and collaborative tools to capture and share knowledge, under the assumption that in a world in which intellectual capital is increasingly important, the company with the best knowledge management system wins. The underlying assumption is right—intellectual capital and knowledge work are increasingly important. But knowledge that isn’t turned into action is about as bad as action that is not informed by knowledge. Our research has uncovered some important barriers to using and implementing knowledge and building a culture of action instead of just talk and analysis. We have found examples and strategies for overcoming the knowing-doing gap to build a culture of implementation. And there are a set of management practices that can create a company that learns from its experience and turns that learning into actions and results.

The data are clear: success does not come from mergers and consolidations to increase size, from being in high technology, from being in the “right” industry, or even from being first to market with an idea—after all, Xerox invented the first personal computer, Ampex made the first VCR, and Amazon was at least the fourth company to begin selling books on line. Instead, studies of companies in numerous industries ranging from automobile manufacturing to semiconductors, studies of companies in multiple industries, and research in countries including the United Kingdom, Korea, and Germany demonstrate the strong correlation between how companies manage their people and their profits, productivity, and customer and employee retention. Our research has identified the essential elements of high performance or high-commitment work arrangements, why these practices are effective, and what this means for building management systems and organizational culture.

Although power is a word that sometimes has negative connotations in organizations, building power and influence is what effective leaders do and is essential to getting things done. Over decades of research, we have uncovered what are effective ways of building and exercising influence, and some of the dilemmas and choices people face as they move through their careers in organizations. It is possible to answer questions such as: 1) when is power and influence more important for getting things done (it turns out that team-oriented, more collegial environments actually make influence skills more, rather than less important); 2) what are the individual attributes associated with being influential, and how can these be developed; 3) what are some effective strategies and tactics for obtaining and using power; 4) how can you develop allies and supporters; 5) how can you deal effectively with opposition and with difficult opponents; and 6) what are some pitfalls to those in positions of power, and how can these be avoided. Our educational work helps people develop their clinical, observational skills, their ability to analyze and exercise influence effectively, and to think constructively about power and its use in getting things done in organizations of all sizes and types.

The most typical response to the difficult economic environment of the past few years has been to cut costs and retrench. There have been layoffs, cutbacks in new product and new expansion initiatives, and attempts to outsource more and more activities. But these moves have seldom considered what their feedback effects will be. A few companies have recognized that tough times present the best opportunity to gain ground on the competition, and have behaved accordingly. What lessons can we draw from their actions?

Many organizations decide what to do based on the past experience of senior leaders, ideology and belief, and through the casual benchmarking of observing what other companies are doing. None of these represent effective ways of making decisions. Meanwhile, companies have ignored massive amounts of evidence that speak to questions such as the effectiveness of stock options and incentive compensation, whether “winning the war for talent” is possible or even desirable, the effects of setting up internal competitive dynamics, and many other questions that are relevant to understanding management strategies and their effects. The fact that knowledge about “what works” and why is so infrequently used provides an opportunity for information arbitrage in the management of companies that is similar to arbitrage opportunities in the financial markets, except the returns are both larger and less likely to be immediately imitated away. Companies need to use more “evidence-based management” and employ a decision process that uncovers hidden assumptions and confronts them with what leaders know to be true.