Purpose of Leadership Teams

Leadership teams exist because no one leader has all the knowledge and perspective needed to lead a complex organisation. Their value comes from bringing those different perspectives together to understand issues, make judgements and agree how the organisation will respond. But this only works when the team is clear about what it needs to do collectively, rather than leaving each leader to work it out themselves and coming up with different expectations.

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Why do organisations have leadership teams anyway?

Most organisations have a senior leadership team. But ask the people around the table what that team is actually for, and you may get several different answers.

One person might see it as a place for the CEO to share information and ask for advice. Another might expect the team to make the organisation’s most important decisions together. Someone else may think it is mainly there to coordinate different parts of the system, resolve problems or provide updates. None of these answers are necessarily wrong. The problem comes when everyone is working from a different assumption.

Why not just have a capable CEO?

Part of the answer is workload. No one person can oversee every aspect of a complex organisation without eventually needing either help or considerably more hours in the day. But there's a more important reason. No one person has all the knowledge, experience and perspective that's needed to understand the organisation as a whole.

A finance director sees the financial implications of a decision. An operations director understands what delivery will involve. A people director sees the implications for staff and capability. Quality and risk leaders notice potential threats and unintended consequences. Technology leaders know what the organisation’s systems can - or definitely cannot - support.

Each leader sees something important. But each sees only part of the picture.

The real value of a leadership team is that it can bring those different perspectives together. The team can develop a fuller understanding of what is happening, consider the implications across the entire organisation and make a more informed judgement about what to do.

At least, that's the theory.

Research suggests that having a range of knowledge and perspectives doesn't automatically lead to better decisions. It depends on whether the team can identify and share the most relevant information, and explain why it matters in a way that others can understand. They then need to be able to explore and question the different perspectives, join the dots and arrive at a view that takes account of the whole picture. Putting several experienced people in a room is a good start. It is not the whole job.

A group of senior leaders is not necessarily a leadership team

Many leadership teams are created through the organisational chart. The CEO’s direct reports become the senior leadership team because they are the CEO’s direct reports.

That gives you a group of senior leaders. It does not necessarily give you a team doing collective work.

If everyone can lead their own area largely independently, and the main purpose of meeting is to exchange updates, the group may be a perfectly useful coordinating forum. But it's difficult to argue that its members are collectively leading the organisation.

This isn't a criticism. It is simply a question about what the organisation needs from them.

Research on senior leadership teams consistently highlights the importance of having a clear purpose. This isn't the organisation’s mission or its strategic objectives, it's a shared understanding of what the leadership team itself needs to do together.

Take growth as an example. The organisation may have an objective to grow. The leadership team needs to work out where that growth will come from, what it will require across the organisation, what risks and trade-offs it is prepared to accept, and how the different functions will contribute. No one director can answer those questions adequately from within their own area.

Two jobs at once

Members of a leadership team usually have two jobs. They lead their own function, service or profession, and they share responsibility for the organisation as a whole. Both are important, but they can pull in different directions. What works well for one function may create problems elsewhere. Resources are limited. Priorities compete. Some issues fall neatly between two areas, which is often where they stay until somebody notices that nobody owns them.

The purpose of the leadership team is not to remove these tensions or make everyone agree. Different perspectives are part of the point. The team’s job is to use them well and reach a judgement that works for the wider organisation. When that purpose is unclear, people make their own assumptions about whether they are there to advise or decide, and whether they are speaking mainly for their function or for the organisation as a whole.

The team may still look busy and reasonably functional. Meetings happen. Papers are discussed. Minutes are taken. Yet the same issues return, ownership remains unclear and people across the organisation hear different versions of what matters. Often, the CEO ends up filling the gaps: reconnecting priorities, resolving disagreements and clarifying what was meant. Some of that is part of the job. But if it happens routinely, the team may not be carrying enough of the collective leadership work.

So what is the purpose of your leadership team?

Before changing meeting structures or organising another team-building day, there is a more basic conversation worth having:

What does this organisation need its leadership team to do together?

Not everything needs collective discussion. Some work belongs to individual leaders and some simply needs coordination between two or three functions. But some issues genuinely require the team to bring together its different perspectives, make a shared judgement and take responsibility for what happens next.

The aim is not to create an elegant purpose statement that nobody remembers. It's to become really clear about which work needs the leadership team and what being part of that team requires from each of its members.

Organisations need leadership teams because some of the work of leading cannot be done well by one person, or by several people working separately.

Making that work explicit is a sensible place to begin.

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