3 Ways You’re Being a Less Effective Leader Than You Could Be

August 19, 2015

less effective leader

Do leaders work or do they sit back and supervise others? Once you’ve been in a leadership role, you realize leadership doesn’t magically happen. It requires skills, expertise and intangible qualities like gravitas. It takes time and effort to apply those capabilities. A leader’s work can be thought of as a range of “leadership services” provided to team members. Providing these services takes time and energy. The same way organizations don’t have unlimited financial capital to invest, leaders don’t have unlimited time and energy to invest in leading their teams. That dynamic requires leaders to be deliberate in their approach to allocating their leadership capital.

Because leadership capital is finite, leaders must invest it intelligently. Unfortunately, however, leaders spend their scarce financial capital much more carefully than they do their precious leadership capital. Because the financial capital budgeting process is competitive, a great deal of thought is put into decisions about how to allocate funds. However financial budgeting is done in your organization, it’s probably one of the most intense decision-making processes you experience.

Compared to the financial budgeting process, the way that leaders decide how to invest their time and energy in their teams can seem arbitrary.

Mistake 1: Spreading Your Time Equally

Some leaders spread it evenly across their team members to achieve equality.  This “spreading peanut butter on a sandwich” approach may be fair.  By using this approach, leaders can avoid being seen as “playing favorites.” But spreading your leadership capital this way isn’t strategic. If your organization’s Chief Financial Officer recommended that your organization’s capital budget be allocated across initiatives and departments in that manner, would he or she be doing a good job? If you made your personal financial investment choices based on this “peanut butter” approach, you might be well-diversified, but would you get the highest return possible on your investment?

Mistake 2: Focusing Your Time on Those Who Demand It

Some leaders allocate their leadership capital by giving more to the loudest requestors. This method is all about achieving peace – the “reactive” approach. Instead of proactively determining where to invest their time and energy, they distribute it on a first come, first served basis. Imagine if your CFO did that with your financial capital. If whoever got to him first was given all the money, would that produce the best return on your capital? Would you make your personal financial investment choices based on which solicitation came in first over the phone or in the mail?

Mistake 3: Spending Time Where It’s Easiest or Most Enjoyable

Leaders may allocate their leadership capital where it’s easiest to do so – the “path of least resistance” approach. In this case, leaders find it easier to work with certain team members than others, so they spend all their time with a subset of their team.

This approach minimizes their stress by limiting their interactions with more difficult team members. That approach is risky. Not only will other team members feel their leader is playing favorites, but the leader isn’t getting the return they should for their leadership capital investment. If your CFO made financial investment allocation decisions based on whom she personally liked the most, would you feel good as a shareholder? Would you make your personal investment choices based solely on which stockbroker was the nicest?

These three approaches have benefits, but they’re not likely to be the best way to get the most efficient and effective output from the entire team. The notion of investing your leadership capital in areas generating the highest return applies the same way it does in financial investing. You should determine how much leadership capital you’re investing, where you’re investing it, and what return you’re receiving. Armed with that knowledge, you can then shift your leadership capital investments into higher return activities to get the best out of your whole team.

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About The Author

Victor Prince: As the Chief Operating Officer (COO) of the Consumer Financial Protection Bureau (CFPB), Victor Prince helped build a new federal agency and led a division of hundreds of people. As a consultant with Bain & Company, he helped clients across the United States and Europe develop successful business strategies. Today, Victor is a consultant and speaker who teaches strategy and leadership skills to clients around the world. His new book, Lead Inside the Box: How Smart Leaders Guide Their Teams to Exceptional Results, provides a new approach for leaders to make smarter decisions on where to invest their time and energy to get the best out of their teams. Visit his website:

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