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Work Foundation finds link between outstanding company performance and people-centred leadership

A people-centred approach to leadership rather than a controlling, target-driven style, is what results in outstanding company performance, according to new research from The Work Foundation

The organisation carried out a two-year study into leadership, including 250 interviews with organsations such as EDF Energy, Guardian Media Group, Tesco and Unilever.

The report revealed three organising principles of outstanding leaders:

  • They think and act systemically, seeing the whole picture rather than compartmentalising
  • They see people as the sole route to performance and are deeply people and relationship-centred rather than just people-oriented
  • They are self-confident without being arrogant; they are aware of their strengths and their position of influence, yet use these for the benefit of their organisation and its people.

The research also found a stark contrast between how outstanding and good leaders behaved. Until all the interviews were completed and analysed, researchers did not know if leaders taking part in the project were deemed to be ‘outstanding' or ‘good' in terms of their achievements and how they were perceived by their direct reports and managers.

Lead author Penny Tamkin said: "There needs to be a paradigm shift for all leaders who remain fixated on numbers and targets.

"Outstanding leaders focus on people, attitudes and engagement, co-creating vision and strategy. Instead of one-to-one meetings centered on tasks, they seek to understand people and their motives. Instead of developing others through training and advice, they do this through challenge and support. They manage performance holistically, attending to the mood and behaviour of their people as well as organisational objectives. And instead of seeing people as one of many priorities, they put the emphasis on people issues first.

"Our findings strongly suggest that an approach which connects leaders to people and people to purpose defines outstanding leadership. Leadership that focuses on mutuality and respect is not only good for people but good for organisations too."

Author Gemma Pearson added: "Outstanding leaders are focused on performance but they see people as the means of achieving great performance and themselves as enablers. They don't seek out the limelight for themselves but challenge, stretch and champion others, giving them the space and support to excel."

The second phase of the research will examine the implications for leadership development and find out if outstanding leadership can be developed through the three organising principles that differentiate it.