We are going through an exponentially increasing rate of Churn, in the economic and business environment, across all geographies and sectors. New business models, competitors, technologies, online digitization, product-lines are widening and deepening the pool of challenges & opportunities. At the same time, changes in governments and their policies, the uncertainty of regulations & tax regimes, changing international trade tariffs, unknowns of a highly interconnected world, are only adding to the mix. In spite of all the tools & techniques at our disposal, we are facing complexities and ambiguities, which are fast outstripping our capacity to comprehend and control.
Signs of this churn are more than visible. The number of companies winding-up, going broke, getting acquired (and re-acquired) is increasing by the day, brick & mortar are yielding space to online worlds, good strategies are becoming unsustainable faster than expected, the shelf life of business models and product-lines are shrinking and intermediaries are getting pushed out of provider-to-consumer equations. For every story of an enterprise navigating itself to glory through this cesspool, a number of sinking boats are going up by the day.
The impact is deeper than bottom-lines and financials. Barring some positives, it is mostly having a negative impact on the genetics both at individual and organizational levels. We are becoming short-term operators. Investors are seeking early gains and well-timed ‘make-the-bubble’ exits at the expense of last gullible standing. CEOs/CxO shelf-lives are getting shorter by the day. Building long-term institutions are becoming an outdated concept. In short, we are suffering from an unfortunate paradox of increasing life-spans with shorter-term perspectives.
At a deeper level (and as a consequence of the above) individuals and middle managers are becoming less trusting of the leaders, commitment to objectives is being replaced by perception management, mutual loyalty between enterprise and employees is tenuous at the best. Leadership-depth is shrinking. In the battle of survival, ethics and integrity are becoming natural first causalities.
To drive home the message, ALL business, over a span of next 5-7 years, face a certain ‘existential risk’ from this climatic change. Even super-robust businesses well-settled are in their strength zones, enduring brands, high entry-exit barriers and with solid demand and supply chains, WILL be facing this churn quicker than they can imagine. The reason is not only an infinite list of changing business variables but also highly disruptive technologies, digitization, aggregation-sharing app-based models, major threats in a multi-polar trigger-happy world, incredible speed of concept to delivery and almost vanishing time-lag between local to global adoption.
What companies need ‘here and now’ is Entrepreneurial Leadership for Climate Change. This Hyper-Competitive and Uncertain world calls for leadership, which is survivalist as well as risk-taking at the same time. Here are the 7 key traits which managers at every level need to have to make it happen.
Leadership Trait #1: Highly Acute Sensory System
All organisms are given senses to get the information from the environment around them. These senses work 24X7, they gather accurate data on the real-time bases and send the signals to the brain to process. A make-it-happen leader needs to develop a highly ‘Perceptive & Receptive’ senses. His information & intelligence network needs to be working on a real-time basis. He needs to be highly objective and emotionless in terms of interpreting the information and take decisions on it.
Remember- Strong Senses are ten times more important than Strong muscles. No point of having big biceps if you cannot see or hear clearly. A company that is able to sense what is going to happen, will be most equipped to respond to (and thrive on) it.
- Develop an extensive network of connections in the industry, within your company.
- Read, Read and Read- Keep in touch with the latest
- Set-up ‘Information and Intelligence’ unit within your company/function which is scanning market, competition, regulators, industry associations and other entities
- Establish information & intelligence gathering process including triangulation of information, periodic/monthly review of the new information followed by decisions.
Leadership Trait #2: Agility and Flexibility
An Agile leader will be committed to the cause, and not how to achieve the objective. He will have the openness and ability to fine-tune or even transform tactical and strategic moves, based on new inputs. Another sub-trait of agile leadership is the capacity to respond. Mental agility is all good as long as you have flexibility and strength in the body to change your moves. An agile leader will establish capabilities, and remove the rigidities in the system so as to make a ‘nimble-footed’ enterprise. For example, a longer than expected winter season can present a great opportunity for an apparel company, if its design and production lines are quick and flexible to churn out an additional batch of clothing and launch campaigns to make the best of 6-8 week window.
- Develop a culture of flexibility and agility. This means to train people at all levels that ‘uncertainty’ is part of the game, and instead of fearing it we should embrace. We should take a business like a sport, where strategy and execution go hand in hand.
- Develop ‘Flexible Capabilities’– This includes
- Highly configurable IT systems
- Flexible production lines
- Multiple channels
- Flexible Supply Chains and Logistics
- Configurable product design and prototyping tools
- Vendor matrix to support changes in supply
Leadership Trait #3: Fostering and Driving Innovation
What?- Here is why innovation is a big deal:
- 20-30 years back – If you were not innovating as an enterprise, you would not have grown
- (10 years back) If you were not innovating as an enterprise, you would have been dead
- NOW- If you do not innovate fast enough as an enterprise, you will be dead
- NEAR FUTURE and that points to you- If you do not innovate fast enough as an individual, you will be dead – though not literally
In today’s world, those who innovate fast; they survive and those who innovate faster than the competition; they thrive. Innovation is no longer a way of life that can be achieved only by encouragement and inspiration. It also needs to be pursued as a non-negotiable business objective. A leader will, as his second nature- question status quo. He will be restless to improve on what he has, he will think out of the box, he will learn from what the best in the industry are doing and he will listen to his customers. As a leader, he will build a culture of innovation in his team and also equip them to pursue continuous improvements.
- Learn about innovation- Innovation is an art as well as a science. It is also a well-established subject with its own tools & techniques.
- As discussed in the previous trait of agility and responsiveness, develop flexible capabilities
- Include innovation as part of the enterprise performance management, where you set-up some minimum benchmarks for implementing new innovative ideas (which customer is ready to pay for)
Leadership Trait #4: Leading Change
This leadership skill broad talks about Leadership skills to managing not only yourself, but also your team, your function, and the organization. Your real-value (which by the way is also mentioned in the technical skills section), is in bringing the change within the organization. An organization is like a body, which keeps on rejuvenating itself, replacing old cells with new, and keep adapting as per the new climate and conditions.
Similarly, as a leader, the mother trait is to be the Change-Leader. Change is needed in any organization due to hundreds of reasons. Some key reasons are-
- To Respond to Competition
- To reduce cost
- To automate processes
- To improve organizational culture
- To change the fundamental business model
- To change the operational model
- To increase productivity and quality
Change leadership needs the following qualities:
- Ability to embrace ambiguities and live with uncertainty
- Ability to influence and persuade people
- Remain closely engaged with the strategic changes happening in the company and support them.
- Ability lead as well as work with cross-functional teams
- Ability to communicate highly effectively
- Learn the art and science of change management. There are a lot of tools and techniques available.
- Develop strong interpersonal relationships with people in all functions and levels.
- Develop interdependent connections with key people within the organization (give and take favors). Contrary to general opinion, helping each other out strengthens relationships.
- Promote Change Management Training and Coaching Sessions- and make people excited about ‘Change’
Leadership Trait #5: Enterprise Digitization
There is a whole technical & functional aspect of digitization. Here we are talking about ‘Digitization’ culture and mind-set. A leader will lead his team and enterprise in the digital world and bring in huge benefits to customers, employees, and shareholders. At the same time, the challenges of digitization are immense. ‘Digital leadership’ will involve:
- Understanding digitization and what it means for the company, its products, customers, employees, and vendors. A good leader will cut through the clutter and is able to sort out high priority digital initiatives.
- Tech-Savviness: A good leader will be highly comfortable and embrace information technology. He will not resist trying new gizmos and applications.
- Intermediary between tech and business: Leaders will be able to speak both business and tech language. He will be able to bring together diverse functions with a common goal.
- Digitization strategic thinking: You will be able to reshape your strategy using the best of the digitization tools & techniques.
Here are some of the systematic actions that you can do. These actions are assuming that you still need to develop a digitization mind-set.
- Read a lot about digitization- Learn new developments, digital applications & platforms, business models based on e-commerce and much more.
- Try out and train yourself on digital tools- Download apps and study them, see the demo of business systems which are relevant for you.
- Connect with Digitization experts- There are many professionals who are a few steps ahead of you. There are online forums and blogs which can provide you lot of day to day applications.
- Use digitization in change management- Apply digitization in innovation and change-initiatives. As a matter of fact, almost all transformation within an enterprise will need some level of digitization.
Leadership Trait #6: Killing your Business
A leader should be the most hard-nosed devil’s advocate to his own strategies. He will stay detached and take an objective look at his business plan.
KYB (Killing your business) is a unique strategy formation process, where you role-play as a competitor and work to destroy your business by exploiting its weakness. It’s like playing chess from both sides. Your leadership mindset has to be on the same wavelength.
As a leader, you will continuously do the fault-finding and identifying vulnerabilities. This will lead to strengthening your flanks. It’s also like companies hiring hackers to check their security systems. Here you are your own hacker and also the security firewall
Leadership is best demonstrated when you make it a habit. A habit is best developed when you follow a process. Here is the process you can follow:
- When you review your strategy every quarter (or more frequently), do systematic thinking on how you will kill your business.
- Hire an independent entity who can be your devil’s advocate.
- Train your team for not being complacent or have blind faith in management. Ask them to speak-up
Leadership Trait #7: Build Entrepreneurial Culture & Skills
The most important task for a leader is not to do great things, but make their teams do great things. In this spirit, a leader has a non-negotiable responsibility to develop leaders and culture for a future-ready enterprise. A leader will develop the following traits and capabilities in his team:
- Multi-Skilled Employees managing diverse responsibilities
- Quick learning organization where people can pick new skills and apply them in a short span
- People are passionate about the cause and are not emotionally bound to their ideas
- People are not seeking 100% clarity, but embrace ambiguity and learn to live with it
- People are well-engaged and co-ordinated like a single organism and can move to-gather to respond to any situation
- Be a role model. Demonstrate to your teams on how responsive, agile and flexible you are. They should see you letting go of your pet project and ideas for the sake of the company.
- Hire people with entrepreneurial attitudes using psychometrics and situation based evaluation techniques.
- Create career paths, compensation, and rewards scheme which promote a shareholder-focused mindset like treating companies money like my own money
- Lay down clear leadership expectations and give feedback on a real-time and periodic basis. For example, if an employee takes an initiative on implementing a cost-saving idea- give him an immediate public pat on the back.
Even in the traditional era of business, leadership has been in short supply. In this hyper-competitive business dynamics, leadership expectations are rising and great leaders are becoming a highly scarce commodity. If individuals and enterprises are able to develop themselves for the need of the hour, they will be among the top 10% in their universe.