Leadership Development

What is organizational leadership, and why is it important?

We all need organizational leaders in our teams and on our boards. Here's what organizational leadership is and how to cultivate it in your workplace.

Meryl D’Sa-Wilson

Published on 

March 29, 2023

Updated on 

Time to Read

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83% of businesses believe it’s important to develop leaders at every level, but only five percent successfully do.

But what does it mean to build leaders at every level, and why should organizations consider this type of leadership?

Organizational leadership uses high-potential employees (HiPo) to create a more efficient and productive workforce.

These high-potential leaders align business goals with individual and team skills and talents. They seek to bring out the best in their teams through empathy, observation, problem-solving, and goal-oriented strategies. And this, in time, contributes to the overall mission of the organization.

Let’s find out how organizational leaders can do this.

What is organizational leadership?

Organizational leadership is the ability to guide teams and individuals toward achieving goals by using leadership skills, communication, and clear strategies that align both personal development goals and organizational objectives.

Many think of leadership in terms of only outward qualities that enable a person to command a team or group of people. However, in reality, a lot more is required of leaders than simply the ability to influence others.

This is where the concept of organizational leadership comes in. The idea of organizational leadership emphasizes developing leadership skills and abilities that are relevant across the organization.

The best organizational leaders…

  • Pay close attention to their teams
  • Communicate effectively
  • Prepare for future challenges
  • Determine the abilities and skills of their staff
  • Understand the mission and goals of the organization
  • Align organizational goals with individual skills and use these skill sets to help the company succeed.

As you can see, organizational leaders need more than just leadership skills (even though these skills are crucial).

They also need a growth and strategy mindset, emotional intelligence, attention to detail, and more.

Employee Engagement: A Practical Guide 

5 Components of organizational leadership

What does it take to be an organizational leader? Here are the skills and components of organizational leadership:

1. Confidence in leadership abilities

One key aspect of becoming a leader is confidence. So, many people may steer away from leadership roles or not have any interest in pursuing such roles due to fears of rejection and failure or simply the anxiety of having to manage people.

A good leader must therefore exude confidence in themselves and their ability to lead others. Without it, there's no way they'll champion any kind of organizational change.

2. Communication

Effective leaders know the need to communicate well. This means they need to be good at both speaking and listening.

They must practice active listening to identify what their teams need to perform better and where they may have challenges. Additionally, they need to express what needs to be done and what the expectations are, with empathy and clarity.

3. Perspective

Since organizational leaders work with different people and teams, they need to be able to understand, respect, and work with diverse perspectives and opinions. They might not have a degree in psychology, but they understand organizational behavior.

If they’re unable to view situations and issues from other perspectives, they won’t be able to encourage the team to do their best work together.

4. Attention to Detail

Along with expanding their perspective, leaders also need to have a keen eye for detail. They must be able to see each individual’s strengths and weaknesses and recognize their talents and skills.

They can use this information to build teams that work in harmony and reach the organization’s goals more efficiently.

5. Ethics

Lastly, these leaders will often be in positions of decision-making. So, they’ll need to make ethical decisions that can impact teams and the company at large. They practice critical thinking and consider the extraneous impacts of pursuing strategic goals.

Likewise, they consider how they can build trust and show honesty while creating strong relationships with their team members.

Organizational leadership vs. traditional management

So, how exactly is organizational leadership different from traditional leadership and management? Let’s have a look:

Traditional leadership typically includes passing down instructions, assigning tasks, solving problems as they come up, and completing set goals.

Organizational leadership takes this a few steps further. It has a much wider scope of responsibility – from understanding and communicating the organization’s goals to developing a strategy and plan for growth to identifying how different skill sets can help teams achieve their goals.

Why is organizational leadership important?

Let’s face it: traditional management does not cut it anymore. In comparison, organizational leadership has a much more hands-on approach taking different perspectives into account.

When you have organizational leadership at every level, you can expect better management, more engaged employees, and goal-oriented strategies.

When you incorporate organizational leadership within your company, you create a space that:

1. Engages team members

Under the guidance of an empathetic, observant, and kind leader, employees feel more motivated and do a better job. In a study, 86% said they successfully balanced work-life under a leader focused on empathy. And when employees are not stressed or burnt out, they can focus and invest more in achieving business goals.

2. Cultivates a growth and strategy mindset

These leaders also value and understand the importance of problem-solving and strategy as part of growth and development. So, they can nurture individual and team development and, by extension, contribute to the company’s overall growth.

3. Makes room for communication and mutual respect

But how do they do the above-mentioned things? By using communication to provide clarity, empathy, respect, perspective, and constructive feedback.

3. Promotes a more goal-oriented approach

Organizational leaders focus on both the nitty-gritty as well as the bigger picture. They understand what the organization needs to achieve its goals and how each individual member can contribute. This helps them keep their teams and strategies goal-oriented.

4 Ways to build organizational leaders at work

While some are born with the innate ability to lead, most others require polishing. And leadership as a skill can be learned and developed in promising individuals.

But the key is to identify high-potential employees and provide them with the necessary tools to learn.

Here are some tips for building organizational leadership skills in your managers and executives:

1. Identify promising individuals

Pay close attention to how your employees are performing. Specifically, look at how they communicate and collaborate, the initiatives they take, how they resolve issues, how they manage time and multiple tasks, and the results they generate. All of this can help you identify which employees might be better suited for a leadership position.

Meet with these individuals to understand how they feel about taking up leadership and what support they may need.

2. Mentorship and coaching

Nothing beats learning generated through coaching and mentorship. Once you find your HiPo employees, pair them with mentors in leadership positions. Your budding leaders can learn a lot from these seasoned leaders. Plus, this is a great opportunity to bring them into bigger conversations about company growth and its mission.

Alternatively, you can even organize peer mentorship, where you pair two employees in the same career level or a group leadership program, where you group multiple high-potential employees to learn from each other.

3. Provide leadership opportunities

You also want to provide opportunities where they can actually use and display their leadership skills. Think — team-building exercises and workshops, problem-solving assignments, presentations, seminars, job shadowing, networking events, etc. These are all great opportunities for them to practice their soft, technical, and leadership skills.

Need inspiration? Check out these examples of companies with leadership development programs.

4. Provide constructive feedback and encouragement

Feedback is crucial to development. So, it is important for managers and mentors to provide constructive and useful feedback that can help these budding leaders understand what works and what doesn’t and why.

Take time to sit down and have a chat about their work. And always end with encouragement, even in the face of failure. This is how they will learn empathy and patience that can be transferred to their future positions.

Bottom line

To develop organizational leaders, you need to invest time and resources. It’s worth the investment when you build leaders who are heavily invested in the team’s growth as well as the company’s growth.

And with engaged individuals, you can expect a lower turnover rate where your company starts from scratch each time. Now, mentorship and organizational leadership training can work hand-in-hand as it creates a space for discussion, collaboration, and coaching.

Together Platform makes it easy to pair your budding leaders with experienced ones, from whom they can learn how to step into bigger shoes.

Want to see this in action? Book a demo today!

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