Most leaders who have been successful in driving change over the last decade often say to me “why do we need to change – it’s working”.
Too often leaders are reactive, keen to maintain the status quo and embracing conformity and comfort, they only change structures and procedures when problems occur, rather than being proactive and creating the future they would like to be part of.
History is littered with the relics of companies who carried on doing what they were good at as the world changed around them – Kodak, Blockbuster, Nokia, Woolworths, Xerox to name but a few. These were not bad companies, they just failed to embrace uncertainty and paradox.
And in this world of rapid change, political volatility, demographic changes and 5G set to drive the fourth industrial revolution that is a dangerous position to take.
Also as a society we are facing 'grand challenges' – a move to clean growth in the era of climate change, an ageing population across much of the developed world, the emergence of AI and the Internet of Things, and new mobility with the development of autonomous vehicles.
Keith Grint famously defined wicked problems as complex with “no clear relationship between cause and effect” and often intractable. But the grand challenges of society are like wicked problems on steroids. Climate change, for instance, cannot be solved by one heroic leader, it needs many leaders from many organisations working together as part of a system.
The leaders of the next decade will have to lead differently to tackle these environmental forces and grand challenges as well as build a growing and profitable business, especially as these external pressures are creating paradoxes for leaders traditionally focused only on corporate goals.
Leaders don’t like paradoxes because it creates uncertainty, they want a clear plan ahead, but the next decade will reward those leaders who work with paradox, not around it.
They will have to not only face paradox, but learn to embrace it, work with it and the uncertainty that comes with it. Instead of 'either/or' thinking they need to accept both options. Indeed, they will need a passion for paradox. Here are five they will have to embrace.
1 The paradox of fast and slow
As the pace of change gets ever faster and we suffer from information overload, it is important that leaders stop and be still. They need to find time in their routine to step away to reflect and challenge their assumptions, routines and biases.
Most leaders have lost the ability to stop and think, because we are obsessed with the pace of change, we don’t actually challenge the way we do things. They are too comfortable with their ideas and their status. But leaders need to have the curiosity and courage to challenge their assumptions, and be able to adapt to the changing environment.
Leaders who can add value are those that can stand still and think what needs to be done, they embrace change from experimenting with new ideas while providing 'business as usual'.
Amazon's first chief science officer Andreas Weigend recently revealed the tech giant's obsession with experimentation in an organisation, so it is ready and able to leverage its AI capability.
Weigend said: “Jeff [Bezos] has this great belief in experimentation – of; 'you know we don’t know what will happen here, but let’s try something out, see what we can measure and be very clear from the start what are the metrics that define success'. We did thousands of experiments and found out all kinds of things about human behaviour.”
2 The paradox of today and tomorrow
In the 2020s, leaders need to embrace a shift from years of accumulated wisdom in a single individual discipline, to the ability to access, interpret and contextualize insights provided by machines.
Two decades ago, leadership was very individual, but now we are in a networked and interdependent society, we need to re-think how we practice leadership.
The other important challenge is that we need talent in areas where we have no history. Look at the Internet of Things, look at AI, and so on. This creates new challenges for leadership and requires new and different thinking for leadership development.
This is the paradox of today and tomorrow. Do you train your staff for today or tomorrow? If you develop them for the challenges of today, you might not a have future because you are not ready for tomorrow’s challenges (think about Kodak, Nokia etc) and if you train them for tomorrow you may lose sight of what is happening in the present. Leaders need to embrace this conundrum and develop systems that can train staff for today and tomorrow.
3 The paradox of purpose
Leaders develop their mission, vision, and strategy, around corporate purpose; creating shareholder value, increasing market share or creating a competitive advantage.
But in the next decade leaders will need to think about their organisation’s bigger purpose, how it affects and improves society. This may be a paradox alongside the corporate purpose, but it cannot be ignored.
Consumers and workers are demanding that businesses have a social purpose. When Paul Polman was CEO at Unilever he aligned its corporate purpose with a broader societal purpose to reduce the company’s impact on the environment. This paradox must be encouraged by leaders, and in so doing they will gain a competitive advantage.
4 The paradox of leaders without answers
If leaders think they are suffering information overload now, they have seen nothing yet. The advent of 5G will see all companies become data firms, with all products and objects connected to the internet as the Internet of Things becomes a reality. This technological overload will see leaders have to face another paradox.
They maybe experts in their field, but they will not have all the answers. In fact, the leaders’ role is not to provide answers, but to be a catalyst for change.
Most of the answers will come from the bottom of the organisation, those interacting with the data. Thus, leaders need to build the right relationships so that those sitting down the hierarchy can provide input into the decisions and solutions of the company.
Any mature organisation has more than 10 hierarchies, but how many add value? In the digitised world, hierarchies do not play a part. Leaders need to make sure everybody has a voice, bringing ideas and problems to the surface.
Becoming a catalyst for change involves a mind-shift for leaders and means embracing the human aspects of leadership - the ability to embrace humility, compassion and humanity.
You might have incredibly powerful technology, but if there's no empathy and no humanity in the way it's presented to the people who engage with it, there's no point having an incredibly powerful technology capability.
They need to realise that leadership is not a technical role, it is a human role and should focus on developing the right relationships, invest in the wellbeing of employees and develop the self, through reflective practice and self-awareness.
5 The paradox of the self versus the community
Changing their mindset and becoming a catalyst will require time out for leaders to focus on self-improvement. As Indra Nooyi, CEO of PepsiCo, said: “Just because you are CEO, don't think you have landed. You must continually increase your learning, the way you think, and the way you approach the organisation. I've never forgotten that."
But to tackle the grand challenges of the next decade will also mean working with others. Take the challenge of an ageing society that is putting pressure on a hospital's resources and costs: the hospital CEO may have a very different corporate purpose to a pharmaceutical company, but they may well have a common societal purpose, so that these organisations can work together along with others on this grand challenge.
Indeed, tackling this issue will require the pharma companies, medical technology firms, the Government’s department of health and many other stakeholders to work together.
Leaders need to build capacity for collective leadership in the ecosystem while also thinking about their self-development to tackle these grand challenges. Environmental sustainability, for example, is becoming a key challenge and we see how companies like Puma, Unilever, Patagonia, Lush and others not only changed how they do business but also tried to engage with customers and the industry, to build a relationship with their broader ecosystem.
Dimitrios Spyridonidis is Associate Professor of Leadership and Innovation and Course Director for The Warwick Executive Diploma in Strategic Leadership.
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