Josef Ackermann Essay
Using Darling and Leffel’s (2010) framework, this essay will evaluate on how Josef Ackermann demonstrated his leadership style as a Swiss banker, the former Chief Executive Officer (CEO) of Deutsche Bank and Chairman of Zurich Insurance.
As defined by Peter Northouse (2001), leadership is a process, in which an individual influences a group to achieve a common goal. And to achieve that goal, a visionary leader should put forth much effort to critically apply his leadership skills and knowledge. In general, leadership is more than management. To be successful, a leader has to be strategic, show motivation and innovation, and should be flexible and focused on systems and structures. (Lussier & Achua, 2010). The basic interactive dimensions of assertiveness and responsiveness form two axes of the Darling and Leffel leadership styles paradigm, the four primary quadrants represent the four styles: Analyser, Connector, Director and Creator. It should also be mentioned that different situations require accurate application of different leadership styles.
According to Lussier and Achua (2010) there are four key leadership theories: Autocratic, with job-centred (task-initiating structure) behaviour that focuses on the leader who is taking control in order to get the job done quickly (Professional Organizations, n.d.); Laissez-Faire, a style that depicts an inert leader who is averse to stimulating subordinates or giving focus (Deluga, 1990); Participative (democratic),a style in which leaders empower their employees in the decision-making process by meeting with them periodically and listening and trusting them (UCF, n.d.); and Transactional, one that asserts that people will follow leaders who are inspirational as the leader develops a vision, sells the vision and leads the way (Taylor, 2009).
Of the four main leadership styles outlined by Darling and Leffel (2010), Josef Ackermann, reputed as the most powerful banker in Europe, could be regarded as Analyser and Director. The author describes the Analyser leadership style as having a low level of assertiveness and responsiveness. Analysers are self-controlled, logical, objective, well-organized and generally leaders who prefer analysis over emotion. Also, the Analyser can be inflexible and formal, prefer clarity and order and tend to resist compromise in problem situations. Furthermore, Analyser-type leaders often find their career tracks in the finance field, very much like Ackermann (Darling & Leffel, 2010). Josef Ackermann charted his own course throughout his life, described as a man of integrity that has acquired huge influence over E.U. finances. As an objective chairman of Deutsche bank, 134-year-old Deutsche Bank became the world’s seventh-largest bank in terms of revenue in 2003. Deutsche bank was ranked 12th in mergers and acquisitions and 21st in terms of market capitalization (Guyon, 2004).
As an Analyser, a lot of people see him as a systematic, formal, ambitious and deliberate lead-by-example leader. In addition to having an Analyser style, Ackermann, could also be described as having a Director-leadership style that shows low level of emotional responsiveness (Darling & Leffel, 2010). Such leaders tend to be results-oriented, objective, independent and pragmatic. The authors state that Directors often find their way into positions of authority and central decision-making in organisations. They are firm and forceful leaders, confident, competitive, decisive and generally willing to take risk. In Ackermann’s effort to turn Deutsche Bank from a German lender into a global competitor, he eliminated results-oriented 14,470 jobs and cut costs by one-third by closing retail branches and outsourcing management of the bank’s computer systems and real estate (Schlager, 2005). Ackermann showed the ability to take high risk, but was especially emotionless for his own benefit. On the other hand, he personifies therefore for a lot of people the arrogance and greediness of the banking sector. One of his biggest goals was turning Deutsche Bank into one of the world’s top three advisers on mergers and acquisitions and returning its status to the top ten in market value (Guyon , 2004).
As a Director-level leader, Josef Ackermann has been well regarded and recognised by many as a successful and effective manager and leader, shifting the style of management from a conventional mode to one that focused on the needs of shareholders and on international expansion (Mitchell, 2010). According to Lussier and Achua (2010), leaders such as Ackermann are able to take swift and decisive action, even in the most difficult situations, and take calculated risks while persevering in the face of failure. Strong communication skills, self-confidence, the ability to manage others and willingness to embrace change also characterize a successful leader.
Ackermann has also been a member of the influential Washington-based financial advisory body, the Group of Thirty and also served on other company boards, including Bayer AG, Deutsche Lufthansa AG, Linde, Mannesman, and Siemens AG. Ackermann changed the distribution of power within Deutsche Bank, resulting in criticism from traditionalists and praise from those who shared his global focus, allowing him to become the most powerful man in Germany’s financial industry (Loades-Carter, 2005). Ackermann successful steered his bank through the 2008 global financial crisis. Quoted in his speech before the Atlantic Council, ‘Germany will ultimately take whatever steps [are] necessary to keep the euro zone intact’ (Robb, 2012).
It is unusual to find all four styles in one leader. However, it is important for leaders to be aware of their weaknesses. The Director can become dominating and insensitive while weaknesses of the Analyser are perfectionism and inflexibility. Leadership style has a major impact on the success of an organisation. Without Josef Ackermann´s determination, focus and vision as a Director and Analyser, Deutsche Bank, may not have become one of the world´s leading financial services with global focus. Being a symbol of German financial might, he is at the centre of more concentric circles of power than any other banker on the Continent. He has successfully led Deutsche for a decade during the global financial crisis and euro zone debt turmoil. From this seat at the nexus of money and politics, Ackermann, for better or worse, is helping to shape Europe’s economic and financial future. He seems such a fixture that it is hard to imagine Germany without him (Ewing & Alderman, 2011).
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