Part IV: Leadership Discretion

Organizational structures, systems and processes can and do limit the discretionary decision-making space of all involved in organizational life. However, high up in organizations leaders have significant discretion in making decisions. Robert Kaiser and Robert Hogan explore the dark side of what might happen if strategic leaders use their discretionary freedom for personal rather than organizational benefit. Timo Santalainen and Ram Baliga present a real example of discretionary leadership gone bad in an NGO that looks quite healthy on the outside. They refer to the phenomenon of a financially successful company with a sick leader as the “healthy-sick organization.” We juxtapose this chapter with the one by Corey Billington and Michèle Barnett Berg to show how Duncan Covington at computer products, services, and solutions company IQ used his discretionary freedom for the good of the company. Covington inherited a sick organization and introduced key systems, structures, and processes to bring it back to health.