future requires a different leadership approach
TRANSCRIPT
Future Requires a DifferentLeadership ApproachRaj Kumar Paramanathan | June 1, 2018
The increasing pace of digitisation and technological
innovation affect businesses around the globe.
Disruption is always around the corner. In such a
rapidly changing business environment, leadership
transformation is essential. During the recent IRC
EMEA Regional Meeting in Amsterdam all participants
agreed that leadership needs to adapt to the
changing circumstances.
Be agile
Digitisation and technological innovation irreversibly change the way
business is done. In the digital age, the pace of innovation increases every
year, with no signs of it slowing down any time soon. This acceleration
impacts businesses in various ways. Many innovations, such as robotization,
blockchain, artificial intelligence, machine learning or the internet-of-things
are potentially disruptive.
Proven and tested business models can become obsolete in a matter of years
or even months. The very idea of a fixed business model has come into
question.
Changes in the business environment are no longer sporadic, volatility is
‘the new normal’. As a consequence, decision-making processes need to be
fast, short and inclusive. This requires agile leadership, underpinned by a
culture of continuous feedback. But be aware that agility is a fraught term.
At the heart of any agile innovation, the model is a breakdown of the
1/7 www.irc-institute.com
hierarchy. If you retain an old-school, hierarchical management structure,
agile initiatives will eventually fail. For traditional, top-down organisations,
transforming into a non-hierarchical organisation may be one of the main
challenges in the years ahead.
Lead the disruption
Competition is becoming fiercer and multi-directional. Focus has shifted to
Customer-value thinking. It is no longer only the traditional competitors the
companies have to worry about. Disintermediation brought consumers
directly in touch with manufacturers.
Instead of relying on traditional R&R, businesses should focus on new ideas,
continual innovation, redesigning business processes and embedding this in
their corporate culture and organisational structure. Don’t wait for
disruptive technology to come your way, lead the disruption.
A great example comes from NGO War Child, an organisation that is
committed to improving the lives of thousands of children affected by armed
conflict. As a relatively small NGO, the impact of War Child is limited. To
increase its impact, the NGO recently adopted a disruptive strategy; it now
shares its research and methods with other, bigger NGO’s, and encourages
them to make use of it. This strategy has proven to be successful. UNICEF
implements the educational method of War Child in Sudan.
2/7 www.irc-institute.com
C-suite roundtable discussion hosted by IRC in Amsterdam
Appreciate the value of soft skills
In future-proof organisations, an Alpha management style, hierarchy and
bureaucracy are giving way to shared leadership styles of open
communication and employee engagement. The new mantra is to ‘Connect,
Collaborate, Influence and Lead’. Leaders should support an environment
that cross-pollinates ideas, people and thinking among different disciplines
and industries.
We need leaders that care about their employees and take responsibility for
their job satisfaction. There is no other way, because this is what the
younger generations of employees demand. To retain talent, companies have
to embrace their view of work. Microsoft CEO Satya Nadella is a great
example of a leader who understands the importance of soft skills. When he
took over in 2014, the tech giant was in dire shape. It was losing its
competitive advantage to other, more innovative competitors like Apple and
Alphabet. Nadella noted that Microsoft was hampered by its management
and organisational culture, which was top-down and authoritarian, and put
great demands on the private lives of the (predominantly young) employees.
Microsoft at the time was also notorious for the vicious infighting between
different divisions and teams within the company.
3/7 www.irc-institute.com
Nadella introduced a culture that is based on emphatic collaboration. The
new corporate culture, in combination with a new focus on cloud-based
services, turned out to be extremely successful. Microsoft returned to being
a growth stock after stagnating for nearly a decade. Business magazine Fast
Company praised the CEO in a recent profile: ‘Nadella is a contemporary
CEO able to emphasize the kinds of soft skills that are often derided in the
cutthroat world of corporate politics but are, in today’s fast-moving
marketplace, increasingly essential to outsize performance.’
Diversity is a necessity
Another leadership lesson we can learn from Nadella is that innovation can
come from all directions. When a young employee at Microsoft once asked
Nadella why he couldn’t print directly from his phone, the CEO simply
replied ‘Make it happen. You’re in charge of the project.’ A perfect example
of a CEO who understands that ‘innovation’ is not a department, but a
culture. Every organisation needs agents of change.
Look at the boardroom from a team’s perspective. You need diverse qualities
and attitudes in a board. It can be hard and even unsettling to go outside of
your own demographic, but diversity is not just something that is ‘nice to
have’, it is a necessity. It pays to have young people on your board, they are
more inclined to question existing habits and values and challenge
assumptions. Consulting younger people on specific topics can also work
really well. Some companies have very positive experiences with an advisory
millennial board.
Software company Oracle Netherlands recently created the ‘Young Oracle
Board’, with young professionals up to the age of 35 from different business
units of the company. The advisory ‘board’ aims to improve the visibility and
opportunities within Oracle for young employees.
Of course, diversity is not just about demographics. Intellectual diversity is
just as important. Don’t shy away from it, or you will end up with a group of
people who think and look alike.
4/7 www.irc-institute.com
C-suite roundtable discussion hosted by IRC in Amsterdam
Be curious
In today’s environment of uncertainties, it is unwise to rely solely on tried
and tested management practices. Leaders should be alert to unfolding risks
and opportunities and agile in embedding innovation, risk-taking and
creativity into the culture and structure of their organisations. New
methodologies should be developed for acquiring, sharing and disseminating
knowledge and engaging with people within and without the organisation.
Leaders should be curious all the time. Without curiosity, you can’t be a
leader of the pack. At the same time, it is often the collective, not an
individual leader that makes the difference. In the end, leadership is about
spreading the power.
Adapt to your environment, but stay true to your values
The future is inherently uncertain and open to different interpretations. In
today’s world, the future is closing in on us. We live in VUCA-times: Volatile,
Uncertain, Complex and Ambiguous. A modern leader makes more decisions
in one week than a 16th century-leader in a lifetime. Our nervous system
never faced these problems before. We have much more information at our
disposal, that makes decision making more complex. Leaders have to digest
5/7 www.irc-institute.com
information, prioritise, make sure that they do not get lost in the information
flow, and chose the right time for making a decision.
All things considered, a conventional approach to strategic planning can be
downright dangerous as they neither defend against the threats nor take
advantage of the opportunities that higher levels of uncertainty may bring.
Therefore, companies need a flexible strategy. Adapt to your environment
and don’t waste too much time on long-term and detailed strategies. Decide,
test, learn, refine: strategy should become a daily exercise. You are working
with moving targets. Sometimes, the best strategy can be to have no
strategy at all.
Even in a VUCA business environment, companies should stay focused on
what they do best and stay true to their roots and their culture. Meaning,
values and purpose have to be at the heart of your company. Don’t let
uncertainties distract you from what you are good at, or make you forget
who you are. In general, evolution is more sustainable than revolution.
Delegates of the C-suite roundtable discussion hosted by IRC
EXECUTIVE SUMMARY
The main takeaways from the IRC EMEA Round Table on Leadership
Transformation:
1. Be agile. Decision-making processes need to be fast, short and
inclusive. This requires agile leadership, underpinned by a culture of
6/7 www.irc-institute.com
continuous feedback. Agile leadership can only succeed in a non-
hierarchical organisation.
2. Lead the disruption. Businesses should focus on new ideas, continual
innovation, redesigning business processes and embedding this in their
corporate culture and organisational structure. Don’t wait for
disruptive technology to come your way, lead the disruption.
3. Appreciate the value of soft skills. Leaders should care about their
employees and take responsibility for their job satisfaction. So-called
‘soft skills’ may be the key to hard-earned success. This is what
younger generations of employees demand.
4. Diversity is a necessity. It can be hard and even unsettling to go
outside of your own demographic or intellectual peer group, but
diversity is not just something that is ‘nice to have’, it is a necessity. If
you end up with a group of people who look and think alike, you will
miss out on fresh perspectives.
5. Be curious. Leaders should be curious all the time. Without curiosity,
you will never be a leader of the pack.
6. Adapt to your environment, but stay true to your values. In
VUCA-times, companies need a flexible strategy. Adapt to your
environment and don’t waste too much time on long-term and detailed
strategies. Decide, test, learn, refine: strategy should become a daily
exercise. But: Don’t let uncertainties distract you from what you are
good at, or make you forget who you are.
Raj Kumar Paramanathan
Inspired to deliver solutions to business problems, Raj Kumar co-founded
CnetG Asia in Malaysia and Thailand in 2001. As a Partner of the firm,
globally known as IRC, Raj is thrilled by opportunities to search and select
the best executives for hard-to-fill or mission-critical roles. Taking clients
through a series of questions and sharing industry insights, Raj
encapsulates the role profile into a solution for the business problem or
aspiration.
Read more
7/7 www.irc-institute.com