Leadership – The Top of the Soft Skills Ladder
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The topic of leadership is researched and written about incessantly. There is a long history of scholarly work dating back to the early 20th century on the topic. Over the last 100 years, hundreds of thousands of articles, white papers, magazines and books have been devoted to exploring a kaleidoscope of aspects of leadership. It has examined leadership from various perspectives and using diverse theories. There has been a notable increase in scholarly research on leadership in recent decades, particularly since the new millennium, at business schools and think tanks.
Leadership and management in organizations have been extensively studied by psychology and management disciplines, with a significant body of literature exploring the topic. Such research has led to the development of numerous leadership theories, encompassing various aspects like emergence, levels of analysis, and leadership development. And leadership has been frequently theorized and tested at the group level, with research exploring how individuals influence and are influenced within groups. New research continues to emerge, with studies focusing on various aspects of leadership, including its evolution, effectiveness, and the importance of authenticity. There are even post graduate degrees offered in Leadership. And yet, for all of this deep dive into the broad topic, leadership itself is not a technical skill. Leadership is a soft skill. (Gasp!)
Why is this shocking? Ability to lead is considered one of the most important skills any hire can possess. The higher the position, the more important leadership ability becomes. And, yet, it is a soft skill. As discussed over the last few months, soft skills are often undervalued compared to hard skills because they are harder to measure and assess objectively. They also tend to be seen as “people skills” rather than technical expertise, which can lead to them being downplayed. Additionally, employers may assume individuals naturally possess strong soft skills, leading to a lack of training and development in this area. Nonetheless, leadership is a soft skill, and not just any soft skill. It is the king of all soft skills, growing in importance the higher an employee ascends in an organization. Why is that? Why so much attention and value placed on ‘leadership’? Two good case studies can convey the point better than any long-winded treatise.
Case in Point: The “One Ford” Vision
When CEO Alan Mulally – an outsider from Boeing – took the helm, Ford was in dire straits. It was losing billions of dollars, market share was eroding, its global operations were fragmented and inefficient (different regions designed and built entirely different cars for similar segments), and its brand portfolio (which included Jaguar, Land Rover, Aston Martin, and Volvo) was a drain on resources and focus. The company was overly complex, and a major financial crisis was looming on the horizon, threatening the entire automotive industry.
To deal with all these problems simultaneously, Mulally spearheaded the “One Ford” plan. This multifaceted strategy involved several crucial decisions and taking some calculated risks.
1. Aggressively Restructure and Simplify – This meant streamlining global product development. Instead of having Ford Europe, Ford North America, etc., all develop their own distinct vehicles, they would move towards global platforms that could be adapted for different markets. This would reduce complexity and cost significantly.
2. Divest Non-Core Brands – Mulally made the tough call to sell off its luxury brands – Jaguar, Land Rover (to Tata Motors), Aston Martin, and Volvo (to Geely). This allowed Ford to focus all its resources and attention on strengthening the core Ford brand. This was a risky decision.
3. Focus on improving Ford products – The company invested heavily in the quality, fuel efficiency, safety, and smart design of Ford-branded vehicles.
4. “Big Bet” on Financing – The most audacious and prescient decision Mulalley made in late 2006 was to mortgage virtually all of Ford’s assets — including the iconic blue oval logo — to secure a massive $23.6 billion line of credit. This was before the 2008 financial crisis fully hit and credit markets froze. At the time, many saw this as an incredibly risky gamble. But Mulalley could sense that the real estate bubble was going to burst and it would have massive repercussions on lending and the economy as a whole. He positioned Ford perfectly to be able to handle that scenario.
The strategies were crucial for Ford. Because Ford had secured this massive line of credit before the crisis, it had the capital to fund its restructuring and weather the economic storm. Ford was the only one of the “Big Three” American automakers (GM, Ford, Chrysler) to avoid bankruptcy and government bailout money during the 2008-2010 automotive industry crisis. This was a monumental achievement.
The “One Ford” plan led to the development of globally successful and well-regarded vehicles like the Ford Focus and Ford Fiesta, which shared common platforms. Efficiency soared, quality improved, and the company returned to sustained profitability.
Due to his brilliant strategies and timely decisions, Alan Mulally is widely credited with saving Ford. His strategic decisions to simplify, focus, and secure critical financing at the right moment not only ensured the company’s survival but also laid the groundwork for its future success. His leadership is often cited as one of the most successful corporate turnarounds in modern history. Those decisions, particularly the preemptive financing and the unwavering commitment to the “One Ford” plan, demonstrated extraordinary foresight, courage, and strategic clarity.
If a story of prescient leadership demonstrates the importance of this soft skill for business, the story of short-sighted and clueless leadership shows what happens when leadership is lacking.
Case in Point 2: The Kodak Catastrophe
Eastman Kodak’s failure to embrace digital photography is not a case of one bad decision or one poor choice, but on a string of actions taken by a leadership team with its collective heads buried in the sand. An undisputed titan of the photography industry for much of the 20th century, Eastman Kodak and the “Kodak moment” had been synonymous with capturing memories. The company’s film, paper, and chemical sales generated massive profits. And Kodak was not just a market leader; it was an innovator. It was a Kodak engineer named Steve Sasson who invented the world’s first digital camera in 1975. The prototype was the size of a toaster, captured black and white images at 0.01 megapixels, and took 23 seconds to record an image to a cassette tape. But, despite inventing the core technology, Kodak’s leadership made the fateful decision not to aggressively pursue digital photography. Their reasoning was deeply flawed and driven by fear. Kodak’s business model was overwhelmingly reliant on selling film, photographic paper, and developing chemicals. Digital photography, which required no film and allowed for instant viewing and sharing, was seen as a direct threat to this incredibly lucrative cash cow. They worried that pushing digital would destroy their existing business. It took a quarter of a century for that poor decision to drive the company into the ground, but the writing was on the wall.
Management largely viewed digital as a niche or supplementary technology, perhaps useful for some professional applications, but not something that would replace film for the mass market. They believed the quality of film was superior and that consumers wouldn’t sacrifice that for the convenience of digital. Also, decades of market dominance had created a sense of complacency. Complacency in leadership is the kiss of death. The company culture was deeply embedded in the chemical-based photographic process, and there was significant internal resistance to shifting towards an electronics-based future. They continued to invest heavily in film technology, believing they could manage a slow transition.
While Kodak dallied, other companies like Sony, Canon, and Nikon aggressively developed and marketed digital cameras, rapidly improving their quality and lowering their cost. When digital photography did hit the mainstream in the late 1990s and early 2000s, the decline of film was swift and brutal. Kodak’s primary revenue source evaporated at a pace even faster than anyone predicted. By the time Kodak tried to enter the digital camera market, it was too late. They were seen as followers, not leaders, and struggled to compete on price and innovation. Their digital strategy was often muddled, trying to leverage digital to sell more prints rather than fully embracing the new digital ecosystem. The company suffered massive financial losses, laid off tens of thousands of employees, and closed numerous plants. In January 2012, Eastman Kodak filed for Chapter 11 bankruptcy protection. It has since emerged as a much smaller company focused on different areas, but its former glory built on consumer photography is gone.
Kodak’s story highlights how a market leader — even one who pioneered a disruptive technology — could fail catastrophically due to erroneous leadership. By prioritizing the protection of an existing business model over figuring out a way to monetize an emerging technology, Kodak ultimately became a victim of the very innovation it created. This is a prime example of fundamental misjudgment by the leadership. They thought they could put the genie back in the bottle and bury a transformative innovation. And even when digital technology began to improve and gain traction in the 1990s, Kodak was slow to react, ridiculously believing their brand strength and marketing muscle could keep consumers loyal to film. When they finally entered the digital camera market, their efforts were often half-hearted or aimed at protecting their film business rather than truly competing and innovating in the digital space. Of course, as digital cameras became better and cheaper and smartphones integrated high-quality cameras, film sales plunged dramatically, and their market share evaporated.
This failure was not a single bad decision made in one day, but rather a sustained series of really bad decisions over many years, rooted in an inability to see past current profits and embrace a future that looked radically different. And that, in a nutshell, is leadership failure. But Kodak is not alone in leadership failure. Borders. Circuit City. Blockbuster. The list goes on and on. Billions have been lost due to a lack of that “little soft skill” called leadership. This surely shines a different light on the importance of soft skills in business.
Next week, we will dip a toe in the vast ocean of information written about leadership with a focus on leadership development, the same way any skill is developed. It’s the one soft skill that not only can be improved but needs to be honed on a continual basis. Stay tuned.
Quote of the Week
“A leader is one who knows the way, goes the way, and shows the way.”
John C. Maxwell
© 2025, Keren Peters-Atkinson. All rights reserved.
