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Wed, Nov 21, 2012

Ideas & Trends

Why Influence Is the Key Business Competency

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This guest post is by Dale G. Caldwell, author of “Intelligent Influence” and the CEO of Strategic Influence LLC, which provides strategy and operations consulting services to corporations.  He is a member of the board of directors of the United States Tennis Association  and a former New Jersey School Board Member of the Year. Dale graduated from Princeton University with a degree in Economics, received an MBA in Finance from Wharton and completed the Harvard Kennedy School Senior Executives in State and Local Government program.

Leadership. Authority. Power. Command. Influence.

Influence is the elephant in the boardroom. It is a word often repeated but rarely heard. It is what leadership, authority, power and command all have in common. Millions of business people talk about influence daily—while managing people, marketing products, brokering deals, courting new clients—without really understanding the vital role influence plays in their own success or failure and that of their organization. Most have no idea that influence, intelligently cultivated and attentively applied, is the single most important ingredient to effective leadership and unfettered profitability.

Influence is embedded in our notion of leadership, intrinsically understood by marketers to be the basis for sales dominance, fundamental to the ability to manage effectively and inspire teams. Yet the importance of influence to business performance remains hidden even as it represents the key to success across all functions of an organization.

Today’s global financial markets have proven that perception driven by influence is often more important than the underlying fundamentals in determining stock prices and market share. Rapid advances in technology have led to futures markets that are based as much on perceptions and influences as they are on concrete facts. The most sophisticated CEOs understand that managing external influence in the form of corporate branding and internal influence in the form of corporate culture are the fundamentals of success in the business world. A company’s market share, growth, profitability and productivity are determined by the extent of their internal and external influences. As a result, there is great demand for leaders who know how to intelligently use influence to lead diverse teams of people.

The rapid increase in the generational, geographic, skill, experience, racial, cultural and ethnic diversity of corporate employees have made the “Command and Control” leadership styles of the past impotent. Leaders can no longer order people around successfully. They have to influence their subordinates in a way that will maximize their potential. Gone are the days when most executives can give the proverbial order to their employees to “jump” and the employees say “how high?” In today’s business world when a leader asks a subordinate to do the proverbial “jump” the employee will often ask “why?”, “what do I get out of jumping?” and possibly “I’m busy, why don’t you jump!”

Successful leaders of today are sensitive to the influences affecting employee performance. They have developed the ability to empathize with others and recognize that ordering people to do things limits their effectiveness, creativity and engagement with the company. They intelligently utilize influence in a way that enables them to have maximum influence on co-workers, suppliers and customers. The amazing thing about this approach to leadership is that it applies to large and small companies in any industry in any part of the world.

Clearly, the companies led by individuals who know how to intelligently influence others will be the market leaders in the modern global business world. It is essential that every person in management ask themselves if they are one of the business influencers of the future or a command and control leader stuck in the past. The answer to this question will determine how successful they will be in their professional career.

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