Command and control leaderships ultimately don’t work

Leaders must inspire people, rather than intimidate them; build people up, rather than tear them down. That was the message from W. Edmund Clark, CEO of the TD Bank Group, to graduands of York’s Schulich School of Business Kellogg-Schulich Executive MBA program during Fall Convocation.

“Empathy is critical. You have to walk a mile in the shoes of your employees, understand what makes them tick and what ticks them off,” said Clark, who has held several senior positions in the federal EdClarke-Vgovernment and the private sector. He received an honorary doctor of laws degree from York University at the ceremony.

W. Edmund Clark, CEO of the TD Bank Group

“Leadership really does matter. Leadership matters because the reality is in fact the difference between whether you have a good organization or great organization. And as we discovered, in more extreme cases in the financial services industry, it became the difference between life and death for the institution,” said Clark.

“Just think about what happened: The world’s leading banks, names we all knew and recognized, led by the highest-paid employees on the planet, just got it spectacularly wrong. They not only destroyed their own institutions; they blew up the entire global financial system and they sent the world into the greatest down since the great depression.”

What was especially discouraging, said Clark, was that some of the mistakes were obvious. “For many, this crisis underscored their point. The companies don’t fail leaders. Leaders, the values they stand for, the cultures they create, they fail companies,” he said.

He argues that building great teams was the most important strategy for leaders. It is necessary to have people who understand the organization’s strategy and can execute it flawlessly. “Talent is always the key differentiator, and the best leaders know that and they focus on building organizations that can attract and retain great people,” he said. “Hiring the best and making people their best is job number one for leaders.”

The flip side to that is dealing with situations where people aren’t working out. “Avoiding tough people decisions is a decision. It’s a decision to let part of your organization underperform. It’s a decision to have the people in that part of the organization remain trapped in a world where they can’t grow as individuals. Dealing with the situation in a speedy, caring and respectful way defines a ClarkShoukriperson’s leadership,” said Clark.

From left, York Chancellor Roy McMurtry, Clark, and York President & Vice-Chancellor Mamdouh Shoukri

Once the best have been hired, though, the job of leading is just beginning. One of the things Clark always tells new people is that they can’t yell at their employees, which often comes as a surprise.

But Clark believes that command and control leaderships ultimately don’t work. “They can allow organizations to drive hard, but they are very prone to mistakes. They cut off the feedback mechanism to leaders and they don’t use the whole potential of the organization to adapt. The financial crisis underscored in one industry the folly of the single great leader making all the important decisions.

Leaders need to develop the right values throughout the wider management team and to create a culture of transparency and openness where people feel free to escalate a problem or challenge a leader,” said Clark. “Indeed, the biggest fear I have as a CEO is that something bad is happening today, which could be resolved or mitigated, but the people who could help don’t know about it. The only way to avoid that is to create a respectful culture, not a bullying culture.”

Today’s leaders “need to adapt to their employees, to walk in the employees shoes, to understand what holds an individual back from being all that they could be – that is what real leadership is about,” he said. “Whereas leaders once sought to gain control, look strong, impress people, they must now strive to share responsibilities, admit failure, show humility.”

At TD, Clark said they look for new people “with strong egos and low ego needs, people with good judgment and high [emotional intelligence], people with good values and generosity of spirit.”