Imperial Russian Navy, British Battleships.
The piles of books in the room of Henrikki Tikkanen, Professor of Marketing at Aalto University, are a telltale sign that here is someone who quite clearly goes deeper than startup hype. In addition to present-day teachings in marketing, strategy work, and management skills, Tikkanen delves into history.
”Management theories come and go, and each century comes up with its own trends. Yet managing other people involves stronger principles at work. This means we can also learn from history”, says Tikkanen. ”In examining human development and top leaders, I see strong analogies between history and the present age.”
Tikkanen is Professor of Marketing at both Aalto University and Stockholm University. He also sits on the board of Aalto EE.
Lately, Tikkanen has particularly been reading up on naval leadership in World War I. Britain and Germany were involved in a rather extravagant arms race whilst equipping their fleets. In the end, it was the British navy that gained the upper hand, and a century down the line it is fascinating to analyze why it was the Brits who excelled in leadership.
“Germany built the second most expensive fleet in the world, which they didn’t dare use”, Tikkanen interprets. “They suffered from an inferiority complex in the face of the British navy. The Germans were intimidated by the Royal Navy.”
“Battleships were high-tech products of their time, which people had to learn to use in practice. It’s apparent that on a strategic level, the world’s greatest battle fleet and biggest dairy face the same decisions.”
What is the chosen focus, how are competencies developed – and when is competition at its weakest.
“Another interesting aspect about military history is that, unlike business in many cases, it’s so well documented, offering another good reason for closer examination. There’s so much material available about historical characters and decisions.”
So when Tikkanen talks about management skills, he is actually thinking just as much about czars, admirals and fleets from World War I as he does about modern-day companies. As an example from more recent history, Tikkanen and his team have studied the history of Nokia “from around the 1960s to the present day”.
“At different points in history, Nokia has professed good, even excellent leadership. However, the company’s success wasn’t down to individuals, but to the achievement of a culture and drive that were tangible”, analyzes Tikkanen.
During its height of success in the 1990s, Nokia was helmed by a management team coined as the ‘dream team’, which included Olli-Pekka Kallasvuo, Matti Alahuhta, Pekka Ala-Pietilä, and Sari Baldauf. “That drive was also easy to destroy.”
Nokia provides a management lesson that Tikkanen has uncovered from the past.
“A certain type of leader and competencies are right for an organization at a particular time, but at some point these are no longer valid. There’s a similarity to Mikhail Gorbachev’s recent criticism of Vladimir Putin: the ego gets too big.”
Historical lesson number one: Leader, know when to step aside.
Self-analysis is always tricky, and success doesn’t make viewing one’s own situation and persona any easier. Leaders who have managed to get the company’s profits and morale up may not notice when their management style and specialization no longer serve the company. Stepping aside is no easy feat.
“The director and the entire management team need to be seen as a product of their time”, says Tikkanen. “The right people must be in the right time. Even management skills can quickly become invalid. At one extreme you have American listed companies where management can be changed at the drop of a hat for what can seem like a minor reason from a European standpoint.”
A company director is axed by the board – the company’s owners. In politics, it’s citizens who have the last say.
“Political leaders are shown the door when trust has been lost. Voters soon get rid of political leaders who think they are the bee’s knees”, reflects Tikkanen. “Monarchical leaders are of course harder to oust, the Russian Revolution serving as an extreme example. In those cases, leaders are usually only replaced after hitting rock bottom.”
Tikkanen ponders for a while, drawing historical parallels in the back of his mind. Politics and business.
“That’s how it went for Nokia. It had to touch rock bottom before people realized it was a crisis company.”
Tikkanen talks about path dependency: both management and personnel easily get stuck in their old ways, in the path of past achievements and culture.
“It is pretty hard to quickly turn the course of a company that has been managed in a certain way for years or decades. Path dependencies are so strong, like mental locks.”
Path dependency can also drive a company to rely on a harmful management culture.
“There are styles that don’t work in any context: dysfunctional management styles that can be hard to break, as they are so deeply ingrained in the corporate culture. But usually it’s a case of a style no longer working due to changes in the industry.”
On the other hand, in addition to growing accustomed and attached, employees are also harsh critics of the director. In their view, few leaders are perfect during their time.
“Everyone is critical at the time at hand. There’s always room for improvement. In Finland, the stance around directors can often be over-critical.”
Criticism can be seen as unreasonable also from the viewpoint that a single person is rarely even responsible for all that they are held accountable.
Historical lesson number two: Leader, don’t think of yourself as a hero.
“It’s an illusion to think that the managing director – or even the German Emperor – could lead on their own”, says Henrikki Tikkanen.
History gracefully proves that great, lone leaders who would always be right simply do not exist.
“Even the greatest leaders are often uncertain as they make decisions. There’s no such thing as an infallible leader. Good leaders know how to patch up mistakes and change course after making the wrong decision.”
“We imagine that modern corporations have been systematically built and maintained. In reality, a large share of decisions are made simply as issues arise, and things have been organized in an ad hoc way”, says the expert in organizations and management with a pleasant smile on his face. “Organization and management skills will probably never reach a culmination point where people would be ready and have an optimal model for organizing issues.”
And when the organization does seem to be ready, something awkward takes place: the world changes.
“That’s when a vision is vital.”
When it comes to the hero myth attached to leaders, Tikkanen observes a difference between American and European management traditions and rhetoric. The American narrative is alive and kicking with the dream of an infallible super leader.
“The image of a hero leader is pretty clichéd and rigid”, says Tikkanen. “The American press is eager to print how GE’s management puts in 70-hour working weeks. Perhaps this is part of maintaining the myth of a hero leader.”
According to Tikkanen, this illusion also permeates leadership literature. The Professor in Marketing emphasizes teams over heroes.
“Even the greatest leader inevitably makes wrong decisions, but the team can help repair the damages if need be.”
In other words, true management competence involves an ability to surround oneself with the right circle of people.
“An admiral is quite obviously a visible figure in the navy, but even he needs to be surrounded by a team with fresh and relevant experience.”
“Admiralty was reorganized in Britain before World War I. This resulted in the formation of a large body of experts made up of hundreds of officers responsible for different tasks.”
Historical lesson number three: Leader, surround yourself with a dream team.
It is important for management teams to combine relevant competence, which is sometimes easy to achieve: getting headhunters on the job and putting CVs in line. But setting up a management team that ensures that the individuals also get along is a tougher challenge. Group dynamics. A shared driving force.
“Adequate alternation isn’t the only crucial factor for a management team, but also the dynamics within each composition”, says Tikkanen.
“Whether productive feedback is given internally, and whether the right tension that will take the company forward exist.”
Tikkanen provides an example from Finnish corporate history: Traditionally, management teams have been too homogenous. “One half economists and one half engineers, all wearing white socks,” illustrates Tikkanen. “Diversity has been lacking.”
The culture is changing. “But the change isn’t very rapid.”
Tikkanen hopes that the diversity of management teams would be considered at a deeper level than simply in terms of a gender issue. “It’s a question of internal dynamics, how different personalities work together.”
Examples of successful management teams can also be found in history – such as the British military fleets during World War I. “Or Winston Churchill and his team during World War II”, Tikkanen adds. “Brits have had a remarkable ability in establishing these types of teams. They’ve had people with this skill.”
“Throughout history, the British have been forced to bend and come up with creative solutions with fairly small means. In addition, British business life has always included a fair share of humanists in high places. Perhaps their tradition emphasizes learning lessons form history.”
Learning from history is of course a satisfying notion for Tikkanen. He considers many western cultures to in fact be ‘historyless’: “There’s been such an aim to be so modern. People have limited resources, and with a push to keep going forward, only the future is kept in mind. Leaders may feel it’s no use looking back.”
Tikkanen admits that history doesn’t offer absolute truths. “History never repeats itself, but it does provide lessons for reflection: If this has happened once, what can we learn?”
Studying history involves the risk of becoming infatuated with the success stories of the past, which can make the present seem chaotic, boring, or at least unromantic. But Tikkanen does succumb to one of today’s management wisdoms:
“The present decade is quite fragmented: similarly, management teachings do not involve absolute truths. And that’s healthy. The same model doesn’t apply to managing all types of industries or companies. Nowadays, people don’t all have to buy into one, ruling way of seeing things.”
A fragmented era of a multitude of truths fits in with Tikkanen’s understanding of leadership, as he hasn’t come across quick tricks, simple recipes, or overriding guidelines in his search through history.
Historical lesson number four: How to gain followers?
“Leadership is about succeeding in gaining followers. Why that happens is difficult to summarize. Leadership has a great deal to do with personality, or in fact a combination: a merge of personality and institution creates the driving force.”
In discussing great personas, culture, and driving forces, professor Tikkanen refers to both history and the present day. Battleships and startups.
“Why one leader succeeds and another one fails is down to culture and drive.”
Henrikki Tikkanen recommends:
- Strategic Leadership: Theory and Research on Executives, Top Management Teams, and Boards (S Finkelstein, DC Hambrick, AA Cannella).
“An introduction to strategic management.”
- From the Dreadnought to Scapa Flow: The Royal Navy in the Fisher Era, 1904–1919.
“Arthur Marder’s monumental, 5-volume series on naval history during World War I that was published in the 1960s.”
- Johtajuuden seitsemän syntiä (The Seven Sins of Leadership) (Metropolitan Ambrosius, Jaakko Aspara, Pekka Mattila, Timo Kietäväinen, Henrikki Tikkanen).
“A book I co-wrote. I’ve also written the book Henkinen johtajuus (Spiritual Leadership) together with Metropolitan Ambrosius and Timo Kietäväinen.”