Why leadership needs to change

Leadership as an interaction-oriented orientation of the actions of individuals and groups towards the achievement of given goals, which is by definition based on an asymmetrical social relationship of over- and subordination, 1 is in practice at risk of extinction because of its existence in the enterprises and organizations of the 21st century the habitat is deprived.

The demise of classical leadership concepts leaves a gap in theory and practice. On the one hand, many of the long-established concepts and patterns of behavior have become ineffective, critical debates with the heroic management approaches have this area in theory and practice reported as out of date. On the other hand, it remains unclear how the increasingly complex management tasks should be managed today and in the future.

Our thesis is that the leadership gap has led to a dilemma. The departure from traditional concepts is that in the absence of alternative models and practices, despite increasing organizational needs in the organizations, adequate leadership and guidance are increasingly lacking. At the same time, conceptually and practically, in a variety of contexts, is being tested in terms of how sustainable leadership could actually look like under the changed conditions.

In this paper, we attempt to outline the social, organizational and personal framework conditions for the leadership issue, to derive consequences for leadership concepts and practice, and to make some recommendations.

  1. Social conditions

It is not just the economic and financial crisis that draws the public’s attention to the question of whether our networked and interlinked economic systems can still be managed and controlled at all. Even within companies, social-system designers have been experiencing some discomfort for some time when it comes to formulating goals and implementing them in social systems:

  • Surroundings become more unpredictable. The essential social framework for leadership today is a characterization of the organizational environment, which is described under the abbreviation VUCA (Volatility, Uncertainty, Complexity, Ambiguity). Environments and markets are becoming increasingly volatile, so response options and times need to be aligned. Uncertainty and complexity complicate long-term planning decisions. And finally, the world has become more ambivalent and contradictory. We operate in a complex world in which the effects and relationships of economic and social action are very limited and controllable – and yet, and for that very reason, organizations with a longer-term perspective must be controlled.
  • Values compete with numbers. With the increasingly urgent action lines of the global community (keyword: climate change), the change in values in society has accelerated. The all-encompassing claim of society to the sustainability of economic activity can no longer be ignored. We observe a growing discrepancy between actual, pertinent requirements and individual or individualistic cost-benefit considerations and company decisions.
  • CSR activities often only have a fig leaf function and are not located in central management areas. Key questions of Corporate Social Responsibility remain unanswered: Are global challenges translated into imperative decisions and actions? Do they settle down in observable behavior and in the necessary control systems? For example, is sustainability an objective that translates into increased efforts to reuse product components and is rewarded by the market? Is a company seriously creating a public value that can be quantified, and is that a decided and designed goal? The pressure on decision-makers in business, politics and civil society is increasing.

Existing role distributions get out of joint. The network company interferes in the economy. “Prosumers” blur the line between consumers and producers. They demand active participation in the innovation process. Businesses and consumers network and individuals trade goods on virtual platforms. Individual ideas supporters start up start-ups and quickly mobilize private investors for their ideas online. Economy and society permeate, fueled by easy access to infrastructure and information.

  • Valid structures dissolve. The general dissolution of hitherto valid structures affects not only the network economy, but also society in its social structure. A now highly divided society finds its individual reinsurance in networking. Stakeholders harass solidarity groups, time-limited connections replace long-term commitments. The self-determined life as a goal prefers the own multi-optionality of the loyalty to the employer. Social and corporate putty are shared values that reconfigure and goals that are in motion. The authority of institutions is questioned. Particular communities of interest influence municipal decisions. Power structures are newly formed. In the network society, both the need for participation and the demand for freedom of design of one’s own way of life rise.
  • The network society democratizes knowledge. Global and digital availability cause a cross-sectoral increase in knowledge intensity and far-reaching democratization of knowledge. Thus, knowledge acquisition increasingly decouples from formal education systems. Thanks to attractive access (sharing, streaming, gaming …) and extended communication channels (chat, social media, WhatsApp …), information connects with the emotions and interests of the community. Knowledge diffuses over numerous new research

mate into society and is increasingly becoming the power of many. In the network society, the one who shares his knowledge gains over the one who holds it back. At the same time, this increasing transparency of information and knowledge leads to increased legitimacy pressure of publicly exposed persons. Social resonance takes place in real time and without regard to the journalistic quality criteria of institutional senders.

  • The flexibilisation pressure is rising. The rapidly growing international interdependence and the division of labor in global value creation are leading to a pressure of adaptation in companies and, consequently, in private households across space and time. Flexibilizing work in its spatial, temporal and structural dimensions is closely interdependent with drastic changes in our production and work technologies. The forms of service provision are greatly influenced by this. Division of labor, autonomy and freedom of decision of the individual employee as well as the necessary design of management decisions and dispositions are in transition. At the same time, this opens up completely new options for urban design, for example through urban production concepts and changed mobility flows.
  • Fundamentally new business models emerge. In the network society completely new and different business models become possible. These possibilities, which are characterized by networking and digitization, are transforming large sectors of our economy and fundamentally call into question previous sectoral competences, revenue opportunities, resource combinations, employment biographies and performance profiles. New market players are reinventing the rules of the game in whole sectors on the basis of networking.