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Executive Adviser

Leadership

Leading From Below

By James Kelly and Scott Nadler

March 3, 2007

CEOs can't change companies on their own. The secret is to foster a leadership mentality throughout the ranks.

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The importance of leadership from the top is firmly embedded in corporate culture. An image survives of the all-powerful CEO, able to change the way a company operates at will.

But the truth is that at most companies, senior managers are increasingly hamstrung by the demand from investors and analysts for immediate results. If change is going to come about at these companies, it will be because managers below the CEO (and below the whole “C suite” of CEO, COO, CFO) take the initiative and risks to drive the company in a different direction. Change will have to come from those leading from below, rather than relying on leadership from the top.

Taking the Lead

  • The Issue: With most top executives increasingly hamstrung by the demand for immediate results, change in the way companies operate often depends on leadership from below.
  • What’s at Stake: If potential leaders are stifled by the burden of their day-to-day responsibilities or discouraged by the risk of sticking their necks out, a company can miss out on the kind of innovation needed to flourish in a dynamic world.
  • The Bottom Line: There are practical ways for managers below the top tier to play a leadership role that helps both them and their companies. And for senior managers there are ways to encourage this kind of leadership from below.

These potential leaders face their own constraints. Their day-to-day responsibilities can be all-consuming, leaving no time or energy for the effort to expand their influence. And for many below the C suite, the risks of sticking your head up to suggest change seem too great, and the odds of success seem too low.

But those constraints can be overcome.

In seven years of studying the process of leading from below in hundreds of companies around the world, we have identified clear patterns in how managers succeed—and fail—in this effort. These patterns suggest two broad lessons: For the vast majority of business managers who are not CEOs, there are practical ways to play a leadership role that helps their companies, helps improve the impact their companies have on the world, and helps improve their career prospects at the same time. And for that small number of individuals who inhabit the C suite, there are practical ways to encourage the kind of leadership from below that can provide energy, innovation and advantage to the company well beyond what they can deliver alone from the top.

BECOMING A LEADER

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This article was printed from MIT Sloan Management Review online: http://sloanreview.mit.edu/executive-adviser/2007-1/4917/leading-from-below/

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