Every leader knows the feeling: you hit your KPIs, your team performs well, yet the organization still feels stuck. This problem isn’t new.  Back in 1952, sociologist Donald Roy went undercover in a Chicago machine shop to study how workers responded to Scientific Management. He discovered that when employees were rewarded for narrow production goals, they cooperated, but to cheat the system. They slowed down collective output so everyone could hit their individual quotas. His insight remains painfully relevant across all employee categories, including senior leaders. When people’s goals are tied to narrow, local measures of success, they behave rationally for their own scorecards, but irrationally for the organization.

How many ideas never travel across teams because “they’re not in our scope”? How many improvements die in silos because no one is rewarded for looking beyond their own function?

What Enterprise Leadership Really Means

Enterprise leadership is a response to fragmented organizations.  As defined by Korn Ferry (2021), enterprise leadership is the capability of a leader in the context to act, think, and lead for the greater good of the whole enterprise, not just one’s team or function.  In practice, enterprise leadership manifests as individual behaviors that are shaped by both the leader’s capabilities and the organization’s structure.

Leaders who apply enterprise leadership:

• See the connections between functions, markets, and people.
• Make decisions that support the long-term success of the entire organization.
• Mobilize others around shared purpose and enterprise-wide goals.

When organizations cultivate enterprise leadership, they gain agility, coherence, and the capacity to integrate across silos, qualities that are becoming essential in today’s interconnected world.
But if enterprise leadership is so powerful, why is it so difficult to achieve?

Obstacle 1. Narrow Identities: The Psychology of “Us” and “Them”

People tend to define themselves through their immediate groups: “my team,” “my function,” “my region.” This creates a sense of belonging and clarity, but it also generates in-group bias and out-group distance.

Leaders play a pivotal role here. Effective leaders are not simply decision-makers, but they are “entrepreneurs of identity”: They define who “we” are and what “we” stand for.

To lead the enterprise, leaders must expand the sense of “we.” They must connect team identities to a superordinate identity: the purpose and mission of the entire organization. The challenge for enterprise leaders is to turn “my team’s success” into “our enterprise’s success.”

Obstacle 2. Narrow Goals: From SMART to Purposeful

Beyond identity, goals themselves often reinforce short-term, narrow thinking. Indeed, research from CEB shows that organizations are built to reward function specific behaviours, as KPI are not built around enterprise-wide goals.   The widespread use of SMART goals, which are specific, measurable, achievable, relevant, and time-bound, has undoubtedly improved accountability. However, narrow goals can lead to tunnel vision.

When leaders focus too strictly on measurable outputs, they may ignore learning, collaboration, and the long-term impact of their work. Enterprise leadership requires a shift toward superordinate goals. Those are broader, purpose-driven objectives that connect daily work to the organization’s higher mission. An example: Imagine that together with a local goal (e.g., achieve 500k in coffee bean sales in Greater London Region), the London Sales Manager of a quality coffee broker is also assigned to a broader goal (e.g., be recognised as the number one global provider of quality coffee beans). Only this second goal could motivate our leader to participate in a global trade show in London with buyers from around the world.

Superordinate goals (I like to call them supergoals!) bring meaning and coherence:

• They encourage people to think beyond their team metrics;
• Stimulate creativity and adaptability.
• And align effort with purpose rather than compliance.

An enterprise leader asks not only “What are we trying to achieve this quarter?” but also “Why does it matter for the organization, our customers, and our future?”

Obstacle 3. The Cognitive Challenge: Thinking in Systems

Even when leaders want to think for the enterprise, it’s cognitively demanding.  It requires Systems Intelligence: the ability to perceive the organization as a living, interconnected system and to act intelligently within it. System intelligence is really the skill that allows leaders to be enterprise leaders. Systems intelligence combines analytical understanding with emotional attunement.  It involves:

• Seeing interdependencies and feedback loops.
• Balancing short-term and long-term effects.
• Understanding others’ perspectives.
• Acting with both logic and care.

In short, systems intelligence means being aware of the system you’re part of and using that awareness to make it healthier. This requires adaptability, tolerance for ambiguity, empathy, and humility. Also, leaders are often required, or trained, to deliver fast.  But system thinking requires to slow down to access a bird-eye view of the whole company. Compared to linear cause/effect logic and isolated scorecards, this mindset shift can be challenging, but it can be trained. The benefits are huge though, as leaders have unique access to an overall understanding of the enterprise, and once they grasp it they connect different people at all the levels to foster collaboration and create new solutions.

Obstacle 4. Organizational structures are often built for accountability rather than integration.

Even the most systemic leader will struggle in a structure optimized for accountability rather than integration. Modern organizations didn’t evolve by mistake; they were designed to deliver control, predictability, and measurable performance. All qualities that are important to achieve results, but can bring to rigidity if overused.

Departments, budgets, and incentives are efficient tools for specialization, but poor soil for enterprise thinking. Enterprise leadership, therefore, operates in tension with the system’s original purpose. The challenge is not to dismantle silos but to create bridges between them: governance models, metrics, and dialogues that reward both control and connection.

Developing enterprise leaders, then, should also invite reflection on the architecture of rewards and authority, so that collaboration becomes not heroic but habitual.

How can, therefore, enterprise leaders be successful if they do not control the whole machinery? Even within these constraints, leaders are not powerless. They can:

• Make the invisible visible. Regularly ask what current systems reward and what they unintentionally suppress. Awareness of structure is the first act of leadership.
• Prototype collaboration. Where formal redesign isn’t feasible, pilot shared scorecards, dual goals, or cross-unit initiatives that model enterprise logic in miniature.
• Name trade-offs openly. Bring to the surface tensions between short-term results and long-term coherence. Transparency about these dilemmas builds organizational maturity.
• Re-author the story of success. Redefine achievement locally to include learning, trust, and integration, turning collaboration into cultural currency.

Why Enterprise Leadership Works

When organizations align identity, goals, cognition, and structure around enterprise purpose, this can increase the chance of some positive outcomes:

• Agility increases. Decisions flow faster because people share a systemic view.
• Innovation grows. Ideas travel across boundaries instead of dying in silos.
• Commitment deepens. People feel part of something larger than their role.
• Resilience strengthens. The organization adapts as a coordinated whole, not a collection of competing parts.
• Resources are shared. People in the organisation move around resources to support the most important strategic goals.

Fostering Enterprise Leadership
Building enterprise leadership requires action at multiple levels:

• Hiring and Promotion: Select for adaptability, systemic awareness, and integrative thinking.
• Leadership Development: Coach leaders to expand their identities, think in systems, and connect their teams to organizational purpose.
• Goal and Incentive Design: Replace narrow KPIs with enterprise-aligned scorecards and shared success measures.
• Culture and Dialogue: Encourage interdepartmental curiosity and reward collaboration, not territorialism.

The benefits of enterprise leadership are massive: well-intentioned leaders will grow their unit revenue a modest 4% if focused only on their business unit. But those who commit to an enterprise-wide approach grow on average their unit revenue up to a staggering 12% (CEB, 2015) At Human Edge, we know that no single assessment or program can dissolve structural silos. Real enterprise thinking grows through years of reflection, experimentation, and redesign. We can help to embrace the journey, and our tools can help you to make it visible and deliberate.

Closing Thought

From Roy’s factory floor to today’s boardrooms, one truth remains constant:  when people’s goals are misaligned with the system they belong to, performance suffers.  Enterprise leadership is one possibility to see beyond the KPI, that unites purpose with performance, and that helps organizations thrive as interconnected systems.

References
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