THE CHANGING NATURE OF LEADERSHIP

By Nancy R. Lockwood, SPHR, GPHR, HR Content Expert

November 2005

“One reason leaders must know themselves is that they have to pick people to work with
them who will supplement and complement their own powers.”

Source: Trompenaars, F., & Hampden-Turner, C. (2002). 21 leaders for the 21st century:
How innovative leaders manage in a digital age. New York: McGraw-Hill.

Introduction

The concept of leadership in the 21st century has been undergoing a major shift. Further, the
thinking around leadership is complex, related to variables such as changes in societal values,
implementation of organizational change, the awareness of the impact of stress on employees
and the overall development of leadership understanding.1 Thus, the qualifications for leadership
have also shifted toward more ethical, transformational styles of leadership, and more emphasis
is now placed on the importance of developing leaders within an organization.

Today’s Leadership Skills and Competencies

Leadership is defined as the process by which an individual determines direction, influences a

group and directs it toward a specific goal or organizational mission.2 Closely associated with
leadership is change management, defined as the systematic approach and application of
knowledge, tools and resources to deal with change. Change management also means defining
and adopting corporate strategies, structures, procedures and technologies to deal with change in
external conditions and the business environment.3

The definition of leadership and change management, along with the understanding of what is
appropriate for the times and what particular skills and competencies are needed, has
significantly altered from past practice. A prime example of this type of change is today’s
required managerial skill set to effectively manage and supervise employees (see Figure 1). The
overarching theme is reflected in terms such as “empowering,” “listening,” “motivating,”
“enabling,” “mentoring” and “team building.” Further, leadership brand (the ability and unique
attributes of leadership that deliver results in an organization) is a significant intangible value to
all stakeholders.4

1
Figure 1: Skills to Manage Employees: Past and Present
Skills Needed in the Past Skills Needed Today
Ability to control Clarifying expectations Communication

Delegation Coaching and counseling Confidence

Directive Consulting Creativity

Problem-solving Delegating Enabling

Strong authority figure Empowering Leadership

Motivating Negotiating

Organizing Problem-solving

Questioning Team-building
Source: Flaherty, J. S., & Stark, P. B. (1999). The competent leader: A powerful and
practical tool kit for managers and supervisor. Amherst, MA: Human Resource
Development Press, Inc.

Leadership Development

Today, leadership development is defined as formal and informal training and professional
development programs designed for all management and executive-level employees to assist
them in developing the leadership skills and styles required to deal with a variety of situations.5
Finding the talent to meet today’s challenges of growth, globalization and executive leadership
requires strong leadership development. Leading organizations, such as IBM, Johnson &
Johnson and PepsiCo, spend many resources and significant time on leadership development.
Yet qualifying results is not necessarily a simple task. To effectively measure and utilize return
on investment of leadership development programs, organizations need to carefully plan,
implement and evaluate these initiatives.6 With thoughtful measurement, payoffs of leadership
development can be tracked and show positive results for the organization. For example, a study
on succession management documented that organizations with first-rate leadership teams
showed a shareholder return 10% higher than their industry peers.7

However, it is important to be cognizant that developmental assignments can often be “trial by

fire” experiences, pushing an individual beyond his or her comfort zone. Failure can be
detrimental to careers. Leadership transition works best when opportunities to practice and
develop basic leadership capabilities are presented in conjunction with developmental
assignments (see Figure 2). Three ‘best-in-class’ components that support effective leadership
development are 1) careful selection of assignments to support and enhance individual
development as well as deliver business results; 2) solid succession planning to assure a future
pipeline of qualified leaders; and 3) quality action learning with business-focused, developmental
experiences.8

2
Figure 2: Five Basic Tasks of Leaders
1) Ensuring that the future is being planned for, anticipated and secured.

2) Serving the needs and interests of, and eliciting the support from, key
constituencies.

3) Keeping the team, organization or enterprise focused on substantive results while

meeting the requirements of current realities.

4) Building a long-term, value-added network of relationships.

5) Tying it all together strategically.

Source: Staub, R. E. II. (2000). The Heart of Leadership: 12 Practices of Courageous
Leaders. Provo, UT: Executive Excellence Publishing.

In addition, leadership often involves a transition. Individuals go through transitions—both

personal and professional—in their journey to become a leader. Part of this transition involves
questions such as “is this worth it?” and “do I have what it takes?” This transition also centers on
specific challenges of learning to lead (see Figure 3).9

Figure 3: Key Challenges to Learning to Lead

• Learning to sell—not just produce—good ideas.

• Working through informal networks.

• Communicating clear and simple messages with emotional impact.

• Appropriately delegating.

• Improving social skills (e.g., listening, empathy and coaching).

Source: Ibarra, H. (2004, April). Tracking the Leadership Transition. Training Magazine, 9.

Leadership and Effective Communication

Successful leadership can be measured in terms of effective communication. Whether through

coaching, delegating, making decisions, hiring, counseling or building a team, effective
communication is the essence of leadership. Three key factors are involved in effective
communication: 1) speaking clearly; 2) listening for understanding; and 3) fostering an open
communication climate. The establishment of open communication climate requires trust. To
build trust, it is essential to keep employees informed, have a true open-door policy, encourage
others to express contrary viewpoints, encourage employees to share information and promptly
respond to communication from others.10

Literature and Research

Leadership, Learning and Human Resource Management: Exploring Leadership in Times of

Paradox and Complexity11

3
In response to integrating societal change in the workplace, organizations face complex
challenges. These challenges result in new demands on leadership. This study, based on an
exploratory, multi-method program of research by the Center for Creative Leadership,
considered cross-national data from 157 practicing managers to uncover patterns among
organizations, the societal context and the changing nature of leadership. The study considered
four questions: 1) what skills do individual leaders need to be successful in the future; 2) how is
leadership at the organizational level different today, and what will it look like in the future; 3)
are there differences between the U.S. and non-U.S. populations in their views of organizational
leadership; and 4) what is the current capacity of organizations to accomplish leadership? The
study results reveal changes in leadership practices--from traditional, individual approaches to
more collaborative, innovative approaches. Findings also suggest that non-U.S. populations, as
compared with U.S. populations, expect more innovative leadership approaches in the future.
Future research is recommended regarding the expanding definition of leadership and practical
implications to address emerging approaches to leadership development as well as explore and
understand the differences in perceptions of leadership across cultural boundaries.

Higher Education Leadership Roles in Knowledge Processing12

This study examines the critical roles of leadership in higher education. Through interviews with
executive leaders at higher education institutes, the study explores how these leaders’ roles
define, enable and foster an environment that embraces the demands of a knowledge-based
organization. Specifically, the study explores how leadership behaviors, policies and programs
inhibit or enable knowledge-processing activities. The study determined the influence of
leadership in six key leadership roles to be significant: 1) environment manager; 2) network
manager; 3) policy manager; 4) crisis manager; 5) knowledge gap manager; and 6) future leader
preparation. The findings indicate that a leader has significant control over the knowledge-
processing environment and that the role of leadership has broader influence than the resolution
of knowledge gaps. The study results suggest that by understanding leadership roles in
knowledge management, organizations can improve the learning capability of their firms.

All Changes Great and Small: Exploring Approaches to Change and Its Leadership13

The change leadership literature indicates that leadership behavior is at the root of many change
problems. This study explores three questions regarding change management and leadership: 1)
what approach to change management is likely to be the most effective in today’s business
environment; 2) what leadership behaviors tend to be associated with effective change
management; and 3) are leadership behaviors related to the underlying assumptions within
different approaches to change. The study included seven organizations, from which 40
individuals provided 70 change stories. The study results indicate that approaches to change that
do not take into account and integrate complexity are unlikely to be successful. Further, the study
results offer evidence that certain combinations of leadership behaviors appear to be more
effective than others in change situations. For example, leadership behaviors with approaches
referred to as framing change and building capacity are more successful than those labeled
shaping behavior. In fact, of the contexts explored, shaping behavior appears to inhibit change
initiatives. While the dominance of various leadership behaviors varies with each approach to
change management, the findings suggest that shaping behavior is the most often used leadership
behavior in directive change.

In Closing

4
In the future, leadership skills, competencies and leadership development will likely be the focus
of many organizations as they push to sustain competitive advantage in the marketplace. Finding,
retaining and nurturing the right talent will become increasingly important as companies vie to
hire, train and develop individuals to promote their mission, values and brands. Consequently,
research studies that address leadership will be in demand and will continue to add value to the
workplace and demonstrate the importance of leadership as a key factor for all organizations.

Online Resources

Center for Creative Leadership: www.ccl.org

Corporate Leadership Council: www.corporateleadershipcouncil.com

Human Capital Institute: www.humancapitalinstitute.org

Institute of Leadership & Management: www.i-l-m.com

Society for Human Resource Management: www.shrm.org

The Conference Board: www.conference-board.org

Wharton Executive Education: http://executiveeducation.wharton.upenn.edu/

Endnotes
1
Higgs, M. (2003). How can we make sense of leadership in the 21st century? Leadership &
Organization Development Journal, 24, 5/6, 273-285.
2
Society for Human Resource Management. (n.d.). SHRM HR glossary of terms. Retrieved
October 17, 2005, from www.shrm.org/hrresources/hrglossary_published/a.asp.
3
Ibid.
4
Ulrich, D., & Brockbank, W. (2005). The HR value proposition. Boston: Harvard Business
School Press.
5
Society for Human Resource Management. (n.d.). SHRM HR glossary of terms. Retrieved
October 17, 2005, from www.shrm.org/hrresources/hrglossary_published/a.asp.
6
Hernez-Broome, G., & Hughes, R. L. (2004). Leadership development: Past, present, and
future. Human Resource Planning, 27, 1, 24-33.
7
Jacobs, D. (2005, March/April). In search of future leaders: Managing the global talent pipeline.
Ivey Business Journal Online, 1.
8
Mercer, S. R. (2005, March). Best-in-class leadership. Leadership Excellence, 22, 3, 17.
9
Ibarra, H. (2004, April). Tracking the leadership transition. Training Magazine, 9.

5
10
Flaherty, J. S., & Stark, P. B. (1999). The competent leader: A powerful and practical tool kit
for managers and supervisor. Amherst, MA: Human Resource Development Press, Inc.
11
Martin, A., & Ernst, C. (2005). Leadership, learning and human resource management:
Exploring leadership in times of paradox and complexity. Corporate Governance, 5, 3, 82-95.
12
Martin, J. S., & Marion, R. (2005). Higher education leadership roles in knowledge processing.
The Learning Organization, 12, 2, 140-152.
13
Higgs, M., & Rowland, D. (2005, June). All changes great and small: Exploring approaches to
change and its leadership. Journal of Change Management, 5, 2, 121-152.

6
 ETHICAL LEADERSHIP

By Nancy R. Lockwood, SPHR, GPHR, HR Content Expert

November 2005

Fast Fact

“Leaders comfortable dealing with challenges from a strong ethical platform will become
the corporate leaders of tomorrow.”

Source: Tichy, N. M., & McGill, A. R. (2003). The ethical challenge: How to lead with
unyielding integrity. San Francisco: John Wiley & Sons.

Introduction

Leading with integrity is at the root of ethical leadership. Broadly defined, ethical leadership is
the demonstration of normatively appropriate conduct through personal actions and interpersonal
relationships, and the promotion of such conduct among followers through two-way
communication, reinforcement and decision-making processes.1 As an ethical leader, it takes
courage to stand up, make unpopular decisions and expose unethical behavior (see Figure 1). As
the leadership literature points out, dilemmas of many kinds test the integrity of management
today at all levels in an increasingly complex world. One study suggests that 70% of all
managers bend company rules due to perceived faulty rules, through performance-based
judgment calls and in response to social norms (e.g., “everybody does it”). To address illegal
conduct, unethical decision-making and rule bending, ethical leadership calls for standards to set
the direction and level of organizational integrity.2

Figure 1: Seven Types of Personal Courage Required of Leaders

1) The courage to dream and put forth that dream.

2) The courage to see current reality.

3) The courage to confront.

4) The courage to be confronted.

5) The courage to learn and grow.

6) The courage to be vulnerable.

7) The courage to act.

Source: Staub, R. E. II. (2000). The heart of leadership: 12 practices of courageous
leaders. Provo, UT: Executive Excellence Publishing.

The Importance of Trust

7
In years past, security, loyalty and trust were the essentials required to build a long-term,
profitable organization. Yet, despite the end of lifetime employment, the loss of two-way loyalty,
significant downsizing and permanently altered perceptions of job security, trust continues to be
a critical factor in leadership—more than ever before. The “new economy” has brought forth a
power balance that is much more egalitarian than the prior employment relationship. Today, the
trend in the workplace is that employees no longer hope for a trustworthy employer: now, they
demand trust from their leaders. However, not all employers are eager to embrace the trust factor
with its implied partnership with employees. Building a trustful workplace environment demands
a solid give-and-take from all parties. Most importantly, leaders must demonstrate ethical
behavior from the start or work hard to rebuild trust (see Figure 2).3

Transformational leadership is one leadership focus that may be said to demonstrate trust as well
as change management approaches. Transformational leadership is defined as a systematic form
of leadership focusing on change and innovation. It is a form of leadership that occurs when
leaders “broaden and elevate the interests of their employees, when they generate awareness and
acceptance of the purposes and the mission of the group and when they stir their employees to
look beyond their own self-interest for the good of the group.”4

Figure 2: Rules to Build a Trusting Workplace Environment

• Maintain integrity.

• Openly communicate vision and values.

• Show respect for fellow employees as equal partners.

• Focus on shared goals more than on personal agendas.

• Do the right thing regardless of personal risk.

• Listen with an open mind.

• Demonstrate caring and compassion.

• Maintain confidences.
Source: Adapted from Izzo, J. B., & Withers, P. (2001). Values shift: The new work ethic
and what it means for business. Vancouver, Canada: Fair Winds Press.

Leadership Dilemmas

Leaders deal with many different situations in various contexts, and their actions are often
considered as examples of their leadership abilities. Below are important points to consider
regarding leadership effectiveness.5

• With workforces becoming more global and more diverse, leaders must understand
people who have different backgrounds, values, cultures and perspectives, without
appearing to be judgmental.6

• The following three negative barriers can strongly hinder effective leadership: 1) fear—
being run by one’s comfort zone and automatic defenses; 2) ego—listening to one’s

8
 smaller self and old system of identification; and 3) impatience—lack of persistence,
rushing versus listening.7

• In a business environment that calls for strategic leadership of ethical behavior,

executives need to be cognizant of the fact that they have a moral impact on leadership
and behaviors—and one that will rarely be seen as neutral. Further, they can influence the
ethical mindsets of their workforce and need to be aware to responsibly use this power to
shift the social context to one of positive self-regulation of ethical behavior as the
organizational norm.8

• Transformational leaders seek to influence people to buy into new possibilities and new
visions. Typically, these leaders provide new inspiration, new direction and new
behaviors to their organizations. They emphasize the importance of understanding change
as a process. Further, an essential factor in the change process is that each individual be a
continual learner.9

Literature and Research

Leading With Integrity: A Qualitative Research Study10

A recent study explored the relationship between leadership and integrity. The study consisted of
interviews with leaders and managers at a district general hospital. From these interviews, 15
themes were identified and compared with other studies in the leadership literature. The study
results note that leadership behavior and perceptions of leadership character are used as
measurements to judge the integrity and effectiveness of a leader. The findings suggest that
leaders are not judged according to the ethical nature of decision-making or leading and
managing complex change. Rather, the findings note that the importance of integrity and ethical
leadership correlates to higher levels of hierarchical status. Further, the study findings indicate
that there is an assumption—via status and success—that leaders lead with integrity.

Moral Person and Moral Manager: How Executives Develop a Reputation for Ethical
Leadership11

This study examined reputation and ethical leadership. Through interviews with senior
executives and corporate ethics officers, the study found that the reputation for executive
leadership was developed through two factors: the executive’s visibility as a moral manager and
his or her visibility as a moral person. The study emphasized the dividends of developing a
reputation for ethical leadership: fewer legal problems, increased employee satisfaction,
increased employee commitment and increased ethical conduct.

Measuring Corporate Integrity: A Survey-Based Approach12

This research explored the issue of corporate integrity and how integrity could be measured. It
was based on a study of the U.S. workforce conducted by KPMG on employee perceptions of
and behavior regarding corporate integrity. The KPMG questionnaire was sent to 3,075
prequalified working adults who were asked how often they observed ethical issues in the
workplace. Seventy-six percent stated they were aware of a violation of company standards or a
violation of the law in the past 12 months by a colleague or manager. The implications of the
findings are significant. A total of 22 different types of ethical infringements were noted, with
different frequencies. Based on this data, in an organization of 1,000 employees, for example, it
is likely that 390 employees would know of deceptive sales practices in the past year, 340
9
employees would probably have witnessed a colleague being sexually harassed and 170 would
know about a breach in the company’s environmental standards. This research points out that in
order to implement an effective compliance or ethics program—and then be able to take
measures to prevent misconduct—boards and management need to know about the scope, nature
and seriousness of the problems that exist. Prior to implementing measures to avoid future
misconduct, the causes and interdependencies of the various types of unethical conduct need to
be examined and understood.

In Closing

In view of well-known corporate scandals, the importance and expectations of ethical leadership
have grown exponentially. Organizations’ reputations, brands and profits are highly influenced
by the perception of stakeholders regarding ethical leadership. No longer can companies afford
to ignore the power of ethics in business. In years to come, ethical leadership will increasingly
become a critical factor of sustainability in the marketplace.

Online Resources

Center for Creative Leadership: www.ccl.org

Corporate Leadership Council: www.corporateleadershipcouncil.com

Ethics Officer Association: www.eoa.org

Ethics Resource Center: www.ethics.org

Institute of Leadership & Management: www.i-l-m.com

SHRM®/Ethics Resource Center 2003 Business Ethics Survey: www.shrm.org

Endnotes
1
Society for Human Resource Management. (n.d.). SHRM HR glossary of terms. Retrieved
October 17, 2005, from www.shrm.org/hrresources/hrglossary_published/a.asp.
2
Dixon, D. L. (2004, October). Lead with integrity. Executive Excellence, 21, 10, 19-21.
3
Izzo, J. B., & Withers, P. (2001). Values shift: The new work ethic and what it means for
business. Vancouver, Canada: Fair Winds Press.
4
Society for Human Resource Management. (n.d.). SHRM HR glossary of terms. Retrieved
October 17, 2005, from www.shrm.org/hrresources/hrglossary_published/a.asp.
5
Goldsmith, M. (2005, Winter). Where you stand depends on who you’re standing with. Leader
to Leader, 35, 35, 12-15.
6
Ibid.

10
7
Staub, R. E. II. (2000). The heart of leadership: 12 practices of courageous leaders. Provo, UT:
Executive Excellence Publishing.
8
Thomas, T., Schermerhorn, J. R. Jr., & Dienhart, J. W. (2004, May). Strategic leadership of
ethical behavior in business. The Academy of Management Executive, 18, 2, 56.
9
Tucker, B. A., & Russell, R. F. (2004, Spring). The influence of the transformational leaders.
Journal of Leadership & Organizational Studies, 10, 4, 103-112.
10
Storr, L. (2004). Leading with integrity: A qualitative research study. Journal of Health
Organization and Management, 18, 6, 415+.
11
Trevino, L. K., Hartman, L. P., & Brown, M. (2000, Summer). Moral person and moral
manager: How executives develop a reputation for ethical leadership. California Management
Review, 42, 4, 128-143.
12
Kaptein, M. & Avelino, S. (2005). Measuring corporate integrity: A survey-based approach.
Corporate Governance, 5, 45-55.

11
 STRATEGIC HR LEADERSHIP

By Nancy R. Lockwood, SPHR, GPHR, HR Content Expert

November 2005

Fast Fact

“HR professionals are uniquely well placed to help current leadership produce the next generation
of leaders by establishing leadership brand, assessing the gaps in the present leadership against this
brand and investing in future leaders.”

Source: Ulrich, D., & Brockbank, W. (2005). The HR value proposition. Boston: Harvard
Business School Press.

Introduction

“Effective HR leaders align their departments with the organizations they serve and match their
resources with business requirements. At the top, HR needs to help make the whole corporation
greater than the sum of its parts and to implement practices that support corporate strategies,
build shareholder value and shape the corporate image. At the business unit level, HR needs to
focus on strategic objectives, identifying and serving target customers, creating wealth in the
marketplace and delivering an employee value proposition.”1

During the last 25 years, HR resource strategy has grown and changed dramatically—from
functional strategies in the 1980s and capabilities strategies in the 1990s to today’s result-
oriented strategies. Strategic shifts in HR reflect changing labor market conditions and new
business thinking. Research suggests that in the future there will be a need for increased
contributions from HR business strategy, including ethical and cultural leadership.2 In the
immediate future, strengthening HR strategic leadership is one of today’s most critical goals.

HR’s Strategic Partner Role

Definition

Strategic HR—The process of taking a long-term approach to human resource management

through the development and implementation of HR programs that address and solve business
problems and directly contribute to major long-term business objectives.3

Expectations regarding HR’s role have shifted significantly (see Figure 1). The strategic role of a
business partner calls for HR to increasingly focus on areas that provide value in the
organization. HR is well-placed to be proactive and provide guidance on strategic issues. Thus,
the development of HR goals related to the overarching organizational goals reflects today’s
emerging result-oriented focus: 1) attracting, developing and recruiting talent; 2) aligning,
engaging, measuring and rewarding performance; and 3) controlling or reducing people costs.4

12
Figure 1: Strategic HR: New Roles in Today’s Workplace
Traditional HR Roles Today’s Strategic Roles
Reactive Proactive
Employee advocate Business partner
Task focus Task and enablement focus
Operational issues Strategic issues
Qualitative measures Quantitative measures
Stability Constant change
How? (tactical) Why? (strategic)
Functional integrity Multi-functional
People as expenses People as assets
Source: Holbechke, L. (2001). Aligning human resources and business strategy. Woburn, MA:
Butterworth-Heinemann.

The Strategic HR Function

Establishing a strategic HR function requires proactive, capable leadership. HR professionals at

all levels must understand the business requirements to best align their roles, objectives and
priorities. Research shows that HR professionals play three roles: strategic partner/change agent,
administrative expert and employee champion. Developing human resource leaders through
focusing on leadership competencies is critical to achieve a strategic HR function.5 In addition,
developmental assignments for human resource professionals that provide educational
opportunities must not be overlooked. Through vision, knowledge and thoughtful actions, the
HR function will gain the required credibility needed for organizational success (see Figure 2).6

Figure 2: Architecture for Intangibles

Level Area of Focus Action Potential
1 Keep your promises. Build and defend a reputation among external and internal
stakeholders for doing what you say you will do.
2 Imagine the future. Define growth strategy and manage trade-offs in customer
intimacy, product innovation and geographic expansion to achieve
growth.
3 Put your money where Provide concrete support for intangibles by building core
strategy is. competencies in R & D, sales and marketing, manufacturing, etc.
4 Build value through Develop capabilities of shared mindset, talent, speed,
organization and people. collaboration, leadership, accountability and learning throughout
the organization.
Source: Ulrich, D., & Brockbank, W. (2005). The HR value proposition. Boston: Harvard
Business School Press.

Strategic HR Planning

13
A tool for strategic HR planning, developed by Wayne Brockbank at the University of Michigan,
examines the linkages between business strategy and human resource management and assesses
the level of alignment. The theory of the strategic HR planning tool is that the closer the
alignment between HR and the business strategy, the better the responsiveness at the company
level and the corresponding ability to adapt to client needs and thus maintain competitive
advantage. A detailed examination of the workforce culture, behaviors and competencies
promotes the successful execution of business strategy. HR’s role includes developing a plan of
HR initiatives to achieve and promote the behaviors, culture and competencies to help the
organization achieve its goals.7

Ideally, the company mission, vision and philosophy are translated into the strategic business
plan. HR plays a key role in developing systems and structures that reflect the organization’s
mission, vision and values and, in conjunction, supports employee performance at the
organizational, team and individual level. HR’s leadership in organization development is also
essential for the organization’s success (see Figure 3). Areas such as change management
(including organizational culture), team effectiveness, leadership and management processes,
organizational learning, and corporate knowledge top the list of organizational development
strategies that forward competitive advantage.8

Figure 3: Human Resource Leadership Capabilities

Shaping Business Developing HR Leading Change Aligning HR Achieving
Strategy
Strategy Processes Results
Understand the Identify people- Enable the Change roles, Implement
business context and related issues and organization to activities and actions and
develop plans to formulate plans to implement change systems to processes to
achieve competitive address them. effectively. achieve desired achieve results.
advantage. outcomes.
Source: Adapted from “Human resource leaders: Capability, strengths and gaps.” (2003). In
Building a strategic HR function. New York: The Human Resource Planning Society.

Literature and Research

How Whirlpool’s HR Department Got ‘Strategic’9

Whirlpool has been concentrating on its corporate strategy, from a focus on manufacturing and
distribution to building customer loyalty. The HR 2005 global priorities include talent and
leadership development (also addressing succession planning), diversity representation,
employee engagement and inclusion, and global competitiveness. Toward this end, Whirlpool
targeted employee engagement as a goal and has seen a dramatic improvement in the past two
years. To determine the drive behind engagement at this organization, the company designed an
engagement survey with 13 drivers of engagement. The survey results revealed that corporate
social responsibility was one of the significant drivers of both customer and employee loyalty.

CEO Transformational Leadership and Organizational Outcomes: The Mediating Role of

Human-Capital-Enhancing Human Resource Management10

14
Using a survey and data of 170 organizations in Singapore, this study considered an integrated
model relating CEO transformational leadership, human-capital-enhancing human resource
management and organizational outcomes. The study focused on organizational performance,
absenteeism and sales. This study found that human resource management fully mediated the
relationship of CEO transformational leadership and the subjective assessment of organizational
outcomes and partially mediated the connection with CEO transformational leadership and
absenteeism. The study results are considered logical, given the important part played by the
CEO in an organization’s success. Further, the essence of transformational leadership is to
motivate and inspire the workforce to achieve organizational and individual excellence.

Skills Development: The Missing Link in Increasing Diversity in Leadership11

In a study on representation of women/ethnic minorities at the senior management level, this

research examined strategies to increase diversity in leadership within organizations in the
United Kingdom. The study focused on three independent leadership studies that addressed the
differences in perception of male and female managerial success, barriers to the career process of
ethnic minorities and changing leadership behavior. Interviews with HR/diversity specialists,
senior managers and ethnic minority employees were also used. The study findings emphasize
the organizational and individual barriers that ethnic minority employees face and the differences
related to male and female managerial success. This study highlights the need for diversity
policies that address skills development, progression and recruitment. The study results point to
questions regarding bias, discrimination and underlying stereotypes regarding the development
and implementation of performance appraisal systems.

In Closing

As noted earlier, the role of HR has transitioned from an administrative function to the
opportunity to be a true strategic business partner. With the movement toward demonstrating HR
strategic leadership capabilities, the demand on HR professionals to expand their leadership
skills and competencies—including business acumen—is increasing. Ultimately, the future of
HR may well depend upon the degree to which it adds value to the organization.

Online Resources

Center for Creative Leadership: www.ccl.org

Corporate Leadership Council: www.corporateleadershipcouncil.com

Human Capital Institute: www.humancapitalinstitute.org

Institute of Leadership & Management: www.i-l-m.com

Society for Human Resource Management: www.shrm.org

The Conference Board: www.conference-board.org

Endnotes
1
Ulrich, D., & Brockbank, W. (2005). The HR value proposition. Boston: Harvard Business
School Press.
15
2
Gubman, E. (2004). HR strategy and planning: From birth to business results. Human Resource
Planning, 27, 1, 13-24.
3
Society for Human Resource Management. (n.d.). SHRM HR glossary of terms. Retrieved
October 17, 2005, from www.shrm.org/hrresources/hrglossary_published/a.asp.
4
Ibid.
5
Walker, W. J., & Vosburgh, R. M. (2003). (Eds.). Building a strategic HR function. New York:
The Human Resource Planning Society.
6
Ulrich, D., & Brockbank, W. (2005). The HR value proposition. Boston: Harvard Business
School Press.
7
Holbechke, L. (2001). Aligning human resources and business strategy. Woburn, MA:
Butterworth-Heinemann.
8
Ibid.
9
How Whirlpool’s HR department got ‘strategic.’ HR Focus, 82, 11, 7-10.
10
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