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TheStreet Open House

Short-termist Politicians Can Learn From Forward-thinking Business Leaders

Stocks in this article: OMC

Poor leadership communication is directly affecting corporate performance and sales. In the past year, 60 percent of people stopped buying, or bought less, from a company due to poor perceptions of the behavior of those in charge. Leadership failure also hits the bottom line far harder than good leadership enhances it.

Poor leadership perceptions led 51 percent of respondents to buy less of a firm's products and services, and 44 percent to boycott it – while positive leadership perceptions prompted only 36 percent of respondents to buy more and 42 percent to start buying. People also view employees and third-party analysts as the most credible representatives of an organization, ahead of senior leaders, with the CEO and other senior management coming in a lowly sixth and joint seventh place from among 12 sources of trustworthy information.

Overall, one in four said leaders in general were demonstrating effective leadership, and there is a 21-point gap between expectations of leaders and their ability to meet them. 

This cynicism is strongest in Europe, where only 8 percent are more confident that leaders will be effective in 2013, just 16 percent believe leaders are effective communicators, and only 14 percent credit European leaders for taking appropriate responsibility when they fall short of expectations.

"This year's data shows a striking gap between leaders' words and deeds, as well as the impact of that gap on the company's sales and reputation," said Rob Flaherty, senior partner and CEO, Ketchum. "At the same time, the fact that employees at large currently carry far greater credibility as company ambassadors than senior management cannot be ignored."

While confidence that leadership will improve in 2013 remains fragile, the study clearly shows a desire globally for a different breed of open, collaborative, consultative leadership, which balances leading by example with the humility to admit mistakes. And "Generation-X" leaders, aged 35 to 50, are the community the world has in its sights, with 62 percent globally looking to them to shape the future.

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