situational leadership styles at Salesforce

Introduction
Situational leadership is a style of leadership that is based on flexibility, where the leader has an adaptive style that changes depending on the situation. Blanchard and Hersey have developed the concept of situational leadership that the leader adapts the style to fit the development level of the followers being influenced (Anthony, 2018). Salesforce was named the number one company to work for in America, and its corporate culture has been described as unique. The CEO is Marc Benioff, one of the company's co-founder, who is co-CEO with Keith Block. Benioff was instrumental in defining the company's culture and its leadership style. This paper will examine leadership as Salesforce, through the lens of situational leadership.
Situational Leadership Styles
There are several different situational leadership styles, which the leader would apply to different followers and different situations as need be. The four main situational leadership styles are delegating, supporting, coaching and directing (Todorov, 2017). Individuals with a high commitment level but low competence are given the directing style. The degree of supportive and directive behaviors will change with the competence and commitment level of the employee. Salesforce is now ranked as the #1 company to work for, and has been highly successful in its relatively short existence, which indicates that its leadership probably has a fairly good grasp of situational leadership. Naturally, the senior leaders are not dealing too much with D1 and D2 people, but they must equip their managers to deal with those levels of employee.
For the most part, however, Salesforce employs the D3 and D4 situational leadership styles. Part of the business model that the company employs is to make sure that it is a an employer of choice, so that it can attract the top talent in its field. This helps the company to avoid the D1 type of employee altogether – the low competence and low commitment employee are simply selected out by employers that have their pick of talent. Occasionally, there are roles at the company that require hiring a D2 – entry level sales roles would be one that Salesforce would have. Even then, the company would quickly move on from anybody whose commitment does not shift upward.
Salesforce's ability to attract and retain top talent has put it in the position to be an innovation leader, and has built innovation throughout the entire company, right into the culture (Lashinsky, 2017). Innovation is typically the hallmark of companies that have highly talented people, that manage to harness that talent. This usually means D4 as the dominant situational leadership style, where managers identify talented employees and, after providing a little bit of direction, simply get out of their way.
However, it should be noted that D3 is an important situational leadership trait for companies that select for highly talented individuals. Those individuals might come to the company with variable commitment, but the ability of management to provide the needed supportive behavior is critical to shifting that commitment level. When an employee has variable commitment, but receives support, the commitment level can shift to high. So there is an important role for a company like Salesforce to utilize the D3 "supporting" leadership style to push talented peopled into the D4 realm, from which their talents can truly be unleashed.
Added Value
The added value of the D3 and D4 leadership styles is clear, at least where Salesforce is concerned. CEO Benioff cites three elements of innovation as having been critical to the company's success, but there are a lot of other innovation drivers at the company (Lashinsky, 2017). Salesforce is one of many CRMs in existence, and one of thousands of prominent SaaS companies. SaaS is a field that moves very quickly, and where a dominant company can become vulnerable with each iteration of a technology. There are countless competitors trying to knock Salesforce from its position of dominance in the business. The ability of the company to continue to innovate is one of the aspects of Salesforce that has allowed it to maintain a market leadership position.
The added value of D4 is that it allows highly talented people to innovate. In general, people who are both motivated and talented benefit from some guidance, but otherwise can be trusted to do good things. In fact, for those types of employees to be at their best, their managers mostly need to stay out of their way. Managers who filter out ideas before testing them are only going to stifle innovation, and also increase the turnover rate. The value added of the D3 style is that employees can be moved to a higher commitment level by giving them the support that maybe assuages some of the underlying apprehensions about the company that are fueling that variable commitment.
Impact
Salesforce benefits considerably from this leadership style. In order to be an innovation leader, even after a company gets as large as they are, requires the ability to attract and retain top talent. In tech, there is always another hot startup that good talent can work for. The attraction of a startup is that people can have more creative freedom to innovate. In order to maintain talent, Salesforce has to match that. Their leadership style and organizational culture allow them to do this. In turn, the ability to retain a lot of their talent is what helps Salesforce continue to be an innovation leader, and stay ahead of the competition.
The impact is also felt on the recruiting side of things. Salesforce having been named as the best place to work is now in a position where it has a fantastic employer brand. This took time, and the most recent Fortune list was the first time that the company had made the number one spot. What this means is that after putting in the work to foster the leadership style and culture that best serve overall strategic objectives, Salesforce is now in a position where it can continue to attract the best talent, as an employer of choice. At this point, the situational leadership approach has turned into a sustainable competitive advantage – the company will continue to bring in better people than its competitors can, and in that way it will be very difficult for its competitors to catch up.
Express Scripts
According to the Glassdoor report, Express Scripts is a poor employer, characterized by a lot of low-skill employees, high turnover, a poor culture and limited opportunity for advancement. Incompetent management, poor work-life balance and long hours are all problems (Comen, Stebbins & Frohlich, 2016). This company likely relies heavily on D1 and maybe some D2 situational leadership. However, if the employees are low skill and low commitment, then management should focus on directing. But with low directive and low support behavior, the company will not turn around their issues with culture, or with turnover, because they will giving employees just enough support to do their jobs, but not enough to feel a sense of anything greater, in other words to increase their commitment.
My Assessment
Some organizations would probably do just fine with D2 type leadership, but for the most part the D4 style, with enough attention to increasing the commitment level of talented people, should drive success. A company should ideally want to innovate, to continue to lead, and in order to do that it has to be an employer of choice. Without that, there is little change of sustained success. Many of the companies that are on the list of worst places to work are older companies that used to be quite powerful in their fields but have failed to foster the right workplace environment (Xerox, Sears, etc.). Efficiency is really promoted by attracting talented people; untalented people are never going to be that efficient, even with a lot of direction.
The big contingency is the type of business that the company is in. Salesforce relies heavily on innovation in order to succeed. But there are certainly a lot of companies that rely more on low-cost strategies, and these companies often feel that the inherently will hire low-skill workers. This does not mean that the D1 strategy is right; Costco has a low cost strategy but yet it employs a very different leadership style than companies like Wal-Mart, or Family Dollar, that also sell at low cost as their primary business model.
For tech companies, or any company that wishes to be not only efficient but innovative, it is important to focus on the types of leadership behaviors that are going to attract and retain the best talent. It can be tempting for a company when it gets larger to start to abandon this, but as Salesforce shows, being the largest company in the industry does not necessarily mean sacrificing culture, if that culture is integral to the success of the company.
All told, Salesforce is a model for a company that understands what it needs to compete, and has executed on that strategy well. Contrast this with companies that are performing poorly, and have low ratings. They cannot attract talent, and this puts them into that D1 spiral, where they always have low commitment, and low competency employees.


References

Anthony, L. (2018) Define situational leadership. Houston Chronicle. Retrieved December 11, 2018 from https://smallbusiness.chron.com/define-situational-leadership-2976.html

Comen, E., Stebbins, S. & Frohlich, T. (2016) 10 worst companies to work for. HuffPost. Retrieved December 11, 2018 from https://www.huffingtonpost.com/entry/worst-companies-to-work-for_us_575b26b0e4b0e39a28ada793

Fortune (2018) 100 Best companies to work for. Fortune. Retrieved December 11, 2018 from http://fortune.com/best-companies/salesforce/

Lashinsky, A. (2017) How CEO Marc Benioff drives relentless forward thinking at Salesforce. Fortune. Retrieved December 11, 2018 from http://fortune.com/2017/10/19/salesforce-marc-benioff-leadership/

Todorov, A. (2017) 4 situational leadership styles. ATodorov.org. Retrieved December 11, 2018 from http://atodorov.org/blog/2017/11/11/4-situational-leadership-styles/