You believe that one of the most overlooked factors in effective leadership is capacity. How do you define ‘leadership capacity’?
A leader’s capacity is the time, energy, resources and focus that she needs to effectively address her priorities and responsibilities. Simply put, it’s the ‘fuel’ that every leader needs in order to accomplish what matters. Deficits in capacity are among the most common factors responsible for breakdowns in a leader’s performance and overall impact.
You have found that leaders at every level — including most executives — do not possess enough capacity to meet their demands. Why is this?
There are two factors, and the first is external and largely out of our personal control: structural forces in the economy have literally baked-in the conditions for severe and sustained capacity deficits. As far back as 1981, Harvard Business Review began publishing articles that dealt with the growing concerns of managers who were overwhelmed by the struggle to cope with rising demands and rapidly changing conditions. Fast forward after a quarter century of cutbacks, downsizing, and increased competition, and the great recession of 2008 was simply an inflection point that reinforced acceptance of the premise that the inverse equation of shrinking resources and increasing demands is business as usual.
When someone is operating with a capacity surplus, things get done when they say they’ll get done. 
‘Doing more with less’ is a corporate mantra linked to several alarming trends: 80 per cent of managers say that the demands they face are increasing; 66 per cent say that their workload is the leading cause of their stress; about half say that they struggle with a lack of focus and clear direction; and 61 per cent say they are working below their optimal level. Beyond the numbers, this translates into adverse impact on performance, engagement and well-being. That’s the big-picture piece.
On the individual side, I have found that many professionals lack proficiency when it comes to assessing their priorities and saying Yes and No, accordingly. While we can’t personally shift those external economic forces, we can regain a measure of influence by using our available capacity more intelligently. We can avoid behaviours that unnecessarily drain our time, energy, resources, and focus while becoming more consistent and effective in how we determine what is truly important.
How do you define an individual’s ‘margin of power’?
The theory of margin is based on the work of
Howard McCluskey — who, in my view is an overlooked powerhouse of a thinker. In the 1970s, he conducted research on adult education to explain why some people could successfully start and finish new projects, goals, or initiatives while others became overwhelmed and unable to succeed. He created a formula that expresses the relationship between the ‘load’ a person carries (the demands placed on them by their family, work, etc.) and their available ‘power’ to carry it (their own energy, competence, etc.). His original formula was presented as a ratio, which can be confusing, so I decided to apply his concept as a straightforward subtractive equation.
To put it in simple terms, your margin of power is what is left over after you use your available resources to address the demands you face. When you have a surplus, or ‘available margin’, it’s because you’ve got more fuel in the tank to deal with what’s on your plate; and when you’re operating at a deficit or a ‘negative margin’, your load is already too much to carry — so any new or unexpected challenges (i.e. your boss drops a new project on your plate, a colleague quits unexpectedly and now you have to cover, etc.) mean that you’re likely to be unsuccessful.
What does it look like when someone has a ‘surplus’ of power?
It shows up differently from person to person, but typically you’ll see behaviours in line with traditional high-performance indicators: things like confidence, and a keen focus on the job at hand — both of which lead to timely and effective execution. When someone is operating with a capacity surplus, things get done when they say they’ll get done, and they get done in a way that adds value for the organization.
When you can get the right things done with the resources you have, you don’t ever feel exhausted or behind. Instead, you feel invigorated. The literature on experiences like ‘flow’ and ‘peak performance’ at work shows that when you can see the results of your investment of capacity, the incremental achievement creates positive momentum and personal satisfaction. This, in turn, creates a virtuous cycle.
Unfortunately, what I see in most cubicles and corner offices is quite the opposite.
It seems like this concept of ‘margin’ and available capacity is fluid. How does this play out in organizational life?
It is definitely fluid, but if you hope to do something about your own capacity gaps, it’s important to honestly assess your available margin on a regular basis. Imagine this scenario: You’re getting your work done and you’re getting it done well. There is a nice rhythm to your days and you feel satisfied about your overall contribution. Out of the blue, there is a leadership change and now you have a new boss. The change itself is not taxing, in fact it’s full of opportunity, but you have to invest unbudgeted time and energy to absorb new expectations, educate your boss about how your projects are going, and prepare differently for team meetings and planning sessions. This new, unexpected load has just tilted your margin close to zero, but you’re still holding on. Perhaps you’re getting a little less sleep and taking a few shortcuts here and there, but no major decline in your performance is noticeable.
Then it happens: It could be something in your personal life, a health issue, or even something positive — maybe you finally start that MBA program you always wanted to complete. Whatever the circumstances, you suddenly have zero margin and can no longer keep up. You get stuck in ‘firefighting mode’ and inadvertently begin to work against yourself with counter-productive behaviours that further drain your capacity. The manager’s dilemma has set in.
Many people lack proficiency when it comes to assessing their priorities and saying Yes and No, accordingly.
Tell us more about ‘the manager’s dilemma’.
It’s the easy improvement you don’t have time to make. It’s the good advice you don’t have the energy to follow. It’s the obvious solution you’re too distracted to notice. When the gap between
the demands you face and the
resources you have to meet them widens past the point of no return, self-defeating actions like these take hold. It’s not intentional; when you’ve exhausted your capacity and feel behind, you just want to catch up in order to regain that feeling of confidence and positive contribution. But the harder you struggle to meet the impossible demand, the more you lose the very performance edge that you need to break the cycle. This is why I call it a ‘dilemma’: once you’ve started to think and act differently, you just can’t resolve the issue with conventional solutions. You have to think about your own thinking and see your own pattern of behaviour for what it is.
For most people, their dilemma emerges subtly. It maybe fatigue from the lack of rest during constant activity, or increasing irritability from waking up tired day after day. For others it could be the frustration from missed workouts, the bit of extra weight from poor diet, the disorientation from excessive travel, or that predictable sore throat that comes after you’ve pushed past your limits for just a little too long.
When you can no longer mask these affects, those around you begin to take notice as you start to inadvertently ignore certain things. Perhaps your communication becomes terse and infrequent, or you compensate by taking charge and inadvertently steamrolling others. Or, maybe you retreat inward and stop asking for help from others at the very moment you need it most. Whatever form it takes, your dilemma can threaten your performance in the short-term and erode your well-being and professional brand over time.
You have said that the moment a manager loses her judgment is the moment her impact begins to decline. What are the signs that this has happened?
Sometimes I’ll hear an over-worked leader say, ‘I just can’t afford to recharge right now; things are way too busy.’ Just think about how counterproductive that is. Or a manager might say, ‘If we had more time, we could do better; but we just have to move on to the next issue.’ Imagine being the customer about to receive this compromised product or service.
Statements like these are indicators that somebody has really gotten stuck. I relate that to losing judgment because of a quote from one of my favourite writers,
Wendell Berry: “If one’s judgment is unsound, their expert advice is of little use.” Whether you’re trying to influence people, projects or strategic priorities, your judgment is at risk the minute you get stuck in the manager’s dilemma.
Unfortunately, the dilemma has a way of blinding us to our own routines. When you’re stuck in its grasp, everything looks like a zero-sum game, where you can either do
this or you can do
that. Which fire of the day will get extinguished, while others are left to burn becomes there is simply not enough capacity to deal with them? It is precisely that dichotomous thinking that keeps us stuck. On the bright side, if we can become students of our own behaviour, we can learn to notice these subtle thought patterns before they become entrenched.
What is your advice for managers who read this and realize that they are operating at a power deficit?
The first thing I would suggest is to create more situational awareness around what your own personal ‘capacity gap’ looks like. You can use three questions to determine this: First, have the demands on you increased over the past several days or weeks? Second, are those demands likely to stay elevated — or even continue to increase? And third, do you have the time, energy, resources, and focus required to address them? If your answers are Yes, Yes and No, you are likely close to the zero margin effect. These three questions are the doorway to self-awareness.
If you’re already stuck in the manager’s dilemma, embrace it and study the way it shows up in your interactions with others. What we are unaware of controls us, so focus on it until you can predict how you’ll respond to difficult demands. Then, do what you can to regain your influence to preserve your capacity. Start by attentively evaluating every demand that comes your way and look more closely at the contributions that you are most skilled at making. To requests that draw on this talent, you say, Yes. To requests that are not aligned, you say, ‘Yes, if …’ and you identify other ways of accomplishing the goals without setting yourself up for failure. This discerning approach forces you to address your capacity problem head-on.
The second thing I would say is, take a
leadership perspective on capacity gaps. Many of your readers are already in the ranks of emerging and established leadership, so it’s imperative to take a wider vantage point and look out for evidence of capacity gaps within the organization’s culture. If people are being rewarded for trying to do more with less, bragging about how much they’re doing and how little sleep they got last night, or comparing worth by how many e-mails are in their inbox — these are clear evidence of capacity gaps. If you can start to identify these things and invoke honest conversation about them, you’ve positioned yourself to both understand and produce a credible response. As I said earlier, we can’t change the macro, structural factors that we face as leaders — but we can certainly influence our organization’s culture by making it permissible to name capacity gaps as legitimate performance deficits. Then, the goal is to figure out what you can do differently to actually increase peoples’ capacity for the things that really matter.
Jesse Sostrin, PhD, is a Director in the U.S. Leadership Coaching Center of Excellence at PricewaterhouseCoopers and the author of
The Manager’s Dilemma (Palgrave MacMillan, 2015). He has served on the adjunct faculty of the Orfalea College of Business at the California Polytechnic State University and has lectured at the University of Arizona and the University of California, Santa Barbara, among others.