August 2016 | 

Personality Is Not Enough: Two Capabilities Every Leader Needs

Personality Is Not Enough

Wharton management professor and Fellow of the Strategic Management Society Harbir Singh says great leadership without strategic aptitude — just like sound strategies without great leadership — can doom organizations to poor performance. But you might not come to that conclusion by reading current books for leaders.

“The problem we see in many of these books, and even in some executive education programs on leadership, is that they place an exclusive emphasis on behaviors and personality traits. You cannot be an effective leader by relying on these factors alone.”

Beyond effective personality traits, leaders need both global perspective and strategic acuity. Singh seeks to strengthen leadership and strategy skills together by directing Wharton’s Global Strategic Leadership program. “We believe real opportunities are found when strategy and leadership are combined with a global context. Good strategies, a local focus, or good leadership alone is not enough,” he emphasizes. “You need leaders who not only have the right traits and behaviors, but who also understand global markets, and can set strategic priorities and deliver on them.”

Specifically, the program focuses on three key strategic tensions that successful leaders must vigilantly monitor and contend with: creating long-term advantages while dealing with short-term priorities, thinking locally and globally, and pursuing new markets and capabilities while exploiting existing ones. All three are explicitly discussed and Wharton faculty offer tools and frameworks for each one. The program also taps the expertise of senior leaders who speak about the key attributes of effective global leadership today.

“Today’s world is highly interconnected. No matter your firm’s geographic footprint,” says Singh, “you are operating in a global context. This doesn’t necessarily mean expanding into foreign markets, but it does mean understanding what is happening in those markets and how they could affect your business.”

Singh cites as an example Walmart, which looked early to China for its supply chain. “As a result of that timing, they got better partners,” he says. “Kmart didn’t source as aggressively, and their cost structure suffered. As a discount retailer, once you are not competitive enough on price, you end up with enormous problems. Walmart didn’t look to China for customers, but it had a global perspective on sourcing.”

But the tension between local and global goes beyond issues of sourcing. When eBay expanded its operations into China in 2004, it sought to dominate the market. But the company used the same local model that was working with their existing customers. “They didn’t pay attention to the ways in which Chinese consumers are different,” says Singh. “Ali Baba saw an opportunity, and created a platform that appealed to Chinese buyers’ need to vet sellers.” The result? At the end of 2015, Alibaba had 2.5 times the active users than eBay did, and eBay’s gross merchandise volume slipped below 2014 numbers.

Creating strategies that take global markets into account, while simultaneously exploiting existing opportunities and looking for new ways to create value in the long term is a tall order. Singh says he doesn’t expect program participants to go back to work and start implementing every new tool and skill immediately. The program provides a 100-Day Plan template, and gives participants time to reflect and discuss when and how they will put their new knowledge into practice. It’s a process that includes input from faculty and peers. “It’s easier to execute when you have a personal, highly detailed plan. Be prepared to lead better by thinking through what to implement, what kinds of demands will be placed on your team, and who will be responsible for what.”