Lousy leadership and its tie to suboptimal resource allocation

In the July 23, 2007 issue of BusinessWeek, Jack and Suzy Welch do their customary 'Ideas the Welch Way' column and their article this week was entitled "Bosses Who Get It All Wrong: Blowhards, Jerks & Wimps".  (BTW, this Jack Welch of GE fame for those who are not familiar).  In their discussion on lousy leadership, they talk about one particularly insidious genre of bosses they label as those "who do not have the guts to differentiate". 

As I've discussed many times, organizational behavior is a key dimension of optimizing resource allocation and making corporate portfolio management a reality.  The Welchs rightfully contend that improving resource allocation becomes near impossible with this type of gut-less leadership style  because "not all investment opportunities are created equal.  But some leaders can't face that reality, and so they sprinkle their resources like cheese on a pizza, a lit bit everywhere.  As a result, promising growth opportunities too often don't get the outsized infusions of cash and people they need.  If they did, someone might get offended during the resource allocation process.  Someone, as in the manager of a weak business or the sponsor of a dubious investment proposal." 

So if you want to improve your company's performance and fund the best initiatives, good leadership by those willing to take a stand is requisite.  There should be no room for the gutless.