Imagine a group of senior vice presidents sitting around a massive conference table in their company’s board room. The CEO suddenly resigned and it’s up to this huge and now sequestered bunch to vote in a new chief executive by a two-thirds-plus-one majority.
These folks can vote up to four times a day, with the opportunity to go with a simple majority if, after nearly two weeks, no vice president has made it to the corner office.
Ballots, which are set onto a plate, drop into a receptacle. Several people tally the count. There are no Internet results-notification here. The company – and its ecosystem of customers, suppliers and distributors – learns if they’ve got a new leader when the smoke from the burning paper ballots swirls white.
That’s an awful lot of legacy – some would even call it archaic attachment to tradition – for any company to shoulder.
But, as we know from the election of Pope Francis this week, another enterprise – the Roman Catholic Church – has been doing exactly that for, well, centuries. If they’ve lasted this long, then their rules deserve to be kept in the play book, right?
The answer depends on what type of corporation you wish to be.
The way the Catholic Church elects its supreme leader is through a method that epitomizes functional smartness which, in turn, values functional smart leaders. This type of leader is not concerned with thinking outside the box. He’s concerned with protecting market share. In this case, caution and adherence to a tried-and-true election format is associated not with gaining converts, but with keeping the supporters the Church already has. In other words, it’s all about survival not growth.
It’s hard to believe that many companies also embrace this risk-averse approach. When a CEO’s mindset is focused on keeping current customers and employees happy, there’s less emphasis on top line growth and innovation.
The corporate example that comes to mind is a certain type of hotel, often part of a family business, which insists on operating using a business model popular a hundred years ago. These establishments employ more people than they need – greeters who guide you to the elevators and staffers who press the elevators’ floor buttons, for example – which cuts into profitability. They’re proud of this “high touch” customer-service approach which provides more employment opportunities, even if this way of thinking leads to inefficiency.
Unlike those hotels, which cherish the “old ways” to give their patrons the royal treatment, other companies cling to certain values that may clash with the ever changing needs and attitudes of the majority of their consumers and clientele. However, lacking the requisite flexibility and maneuverability, these organizations are stuck, too. Consensus management, which conveniently keeps real issues from bubbling to the surface, is often to blame.
The truth is there’s a quite a bit of similarity between the by-the-book papal elections and the we’ve-always-done-it-this-way pontificating of certain companies, CEOs and upper management. Outsiders may acknowledge this week’s events in Vatican City as being part of a tradition that’s respectful of Catholicism’s roots, but still very out of touch with current thought. And that’s exactly the point. The Church wants to continue its ties to ancient wisdom. It’s part of their brand. But other companies need to hold or fold tradition, and to find the fortitude to determine whether being married to the past is what defines them.
This article is by Prasad Kaipa who coaches and advises CEOS all over the world. He co-authored From Smart to Wise: Acting and Leading with Wisdom (Jossey-Bass,2013).