x Abu Dhabi, UAEMonday 24 July 2017

Technical ability is not enough to be a leader

The Life: Sitting in the majlis, listening to a group of owners and chief executives talking about their businesses left me wondering, "Why are they so obsessed with technical capability?"

Sitting in the majlis, listening to a group of owners and chief executives talking about their businesses left me wondering, "Why are they so obsessed with technical capability?"

By the sound of it, it appeared that their leaders do possess the coveted technical prowess.

But, and it is a big but, the owners' frustration is actually a lack of results in their business as they are not growing fast enough. These leaders were struggling to understand why their businesses were not delivering the results as desired.

Their balance sheets are strong with plenty of cash, the market conditions are open to growth and competition is manageable. Then, why are they not growing?

Here are a couple of common themes that stand juxtaposed to growth in this region.

First is an over obsession with technical ability.

Historically, when we were transitioning from sandy deserts and creating the cities we know today, the owners rightfully imported people from around the world who could bring to the region the "technical" skills necessary to build their plans. These employees came in and built our infrastructure, malls, banks and other businesses.

As these companies and the market matured, the need shifted to have leaders who are known for their leadership ability not just their technical skills. Mistakenly though, it is still common practice to search for people with the technical skills.

While the need has shifted, the practice has not. Maybe it is because we always did it this way, or maybe because the owners and chief executives really do enjoy this part of their business. Now, the focus needs to be on leadership capability not solely on the technical ability. Results come from leaders not technicians.

The technicians are really good at doing the business, not growing the business.

Next is the theme of hiring from the multinationals.

On the surface, it makes sense to bring in someone from one of these big companies mandating him to bring his experience to us. But, a multinational is most likely in a very different life stage than a regional company is.

Reviewing the business life cycle of four phases - start-up, growth, maturity and eventually decline - it becomes apparent that likely there is a mismatch.

Most regional companies are in the growth phase aligned with the growth phase of the market. Yet, multinationals, although they may not like to be referred to this way, are almost all in the mature phase.

To complicate matters more, when hiring from a multinational the trend is to look for someone with regional experience.

So the business focuses on hiring a country manager or regional director working for one of the multinationals but who is already posted here.

Again, on the surface this seems logical. Now let's lay out the fundamentals that defy the logic of this decision.

The regional director, or worse country manager, in a multinational is deeply removed from the corporate boardroom. Best-case scenario is they are two people removed from the chief executive and most commonly they are three to five people removed.

While they may excel at running the regional outpost, the distance from and resulting exposure to the C-suite (a corporation's most important senior executives) means in practical terms they cannot bring executive experience with them to the regional firm.

So, what should happen? Instead of sitting in the majlis discussing the technical side of the business, we need to switch our conversations to focus on the capability to lead in the growth phase.

We need to look first and foremost for executive leaders and concentrate on helping the technical experts become just as good at leading.

 

Tommy Weir is an authority on fast-growth and emerging-market leadership, an adviser and the author of The CEO Shift. He is the founder of the Emerging Markets Leadership Center