Nation's problems can be traced to leadership vacuum

— -- Former Chrysler CEO Lee Iacocca published a book last year called Where Have All the Leaders Gone? and challenged readers to name one who emerged from the disaster of Hurricane Katrina.

The same challenge seems equally appropriate in times of credit crunch and looming recession. Why does there seem to be a leadership vacuum at a time when leaders are needed most? Will it persist when the finger-pointing subsides and the global financial storm, seeded with $700 billion in bailout money, rains itself out?

Yes, the leadership vacuum most likely will persist, says University of Southern California business professor Warren Bennis, co-author of Transparency: How Leaders Create a Culture of Candor. Bennis calls it a "leadership meltdown."

"All of the failures can be traced to poor leadership," says Harvard management professor Bill George, former CEO of Medtronic and author of True North: Discover Your Authentic Leadership.

Poor public perceptions

The public saw the leadership vacuum coming long before the latest crisis. President Bush's approval rating had fallen to historic lows and was closing in on 20%. The job-performance rating of Congress was even worse. Harvard's annual National Leadership Index, released this month, found that 80% of the public saw the USA in a leadership crisis. That's up from 77% last year and 65% in 2005.

There were 1,132 CEO departures in the first nine months of 2008, on pace to break the record 1,478 in 2006, according to outplacement firm Challenger Gray & Christmas, and up from 700 a year from 2002 to 2004. Worldwide confidence in business leaders is the lowest it has been in the 10 years of an annual survey by human resources consulting firm Development Dimensions International.

"We've become so impatient in our expectations that many times, we don't give people long enough to discover if they are leaders," says Marilyn Carlson Nelson, former CEO of Carlson Cos., which operates Radisson Hotels and T.G.I. Fridays.

The public deserves to be angry, but the public should also avoid reaching the conclusion that all leaders fall into the same category, says Nelson, who also sits on the boards of ExxonMobil and US West. "I see many leading with a great deal of authenticity and are responsible global citizens. They are resisting the temptation to take shortcuts to provide short-term results."