The Future of Leadership: Why Not Taking A Risk is A Risk

The world is more turbulent, less predictable, more complex, less controllable, more infinite, less knowable and more challenging than we could have imagined. It doesn’t help that we are hard-wired to dislike uncertainty – it makes us feel anxious and uncomfortable, so we avoid it. But avoiding uncertainty is getting harder as the pace of change increases. Hack Future Lab founder and global management thinker Terence Mauri sets out why it’s time to harness risk as a unique inflection point for renewal and reinvention.

Summary

• In some ways, this year has been a gateway or portal from one world to another – a liminal space that allows leaders to break free of old assumptions about the world and discover better ways of scaling an agile, resilient and sustainable future.
• The pandemic showed that for many organizations the old work and talent models are broken. The future of work is arriving faster than ever before. Leaders are moving from command and control to care and co-creation.
• Leaders are transforming their structures to attract new generations, reinvigorate their businesses, and promote employee health and well-being. In short, difficult circumstances are challenging leaders to think and act differently.
• People want to feel more alive at work. Personalized well-being programs will become the norm for workers. Leaders who overlook this critical workplace trend will ultimately erode their workforce capability and lose out on the war for talent.

The last 18 months has showed that the status quo is fragile, unstable and decaying at a faster rate. Change is the only constant and organizations and leaders have to pivot to this turbulent world by focusing not just on business continuity, but on empathy, trust, and well-being of employees. The pandemic totally changed the way we look at work, workplace and the workforce. In many ways, it was an accelerant for change for trust, ethics and transparency and has given leaders a unique opportunity to reimagine a more resilient, inclusive and sustainable future.

Reimagine Relevancy

A CEO said to me recently that the last year is cancelled. I disagree. I think this year is a once-in-a-lifetime opportunity to not just return to work but reimagine relevancy from rethinking workforce capability and automation to the rise of the WFH, WFA and the ‘Nowhere office’. In some ways, the last year has been a gateway or portal from one world to another – a liminal space that allows leaders to break free of old assumptions about the world and discover better ways of scaling an agile, resilient and sustainable future.

There are decades where nothing happens and there are weeks where decades happen. As CEO of Microsoft, Satya Nadella said, ‘for many organizations this year, they have experienced 2 years of transformation in two months’. I personally learnt that a crisis is also an accelerant for learning, growth and reinvention. This year has shown me that it is possible for leaders to win with empathy and that wealth without health is pointless. In the current climate of the global pandemic and economic uncertainty, organizations’ capacity to focus on both the financial physical and mental health of their employees has never been more vital. 

The only certainty is uncertainty

Change used to happen as a breeze. Now it feels like a category five typhoon. Blurring of industry lines, economic and geopolitical uncertainty, disruptive technologies such as AI and automation, shrinking of company and product lifespans – and a global pandemic. 

Now is the time to challenge our limits, not limit our challenges. I call it ROI. Not just return on investment but ‘return on intelligence’. As leadership and business models decay at a faster rate, my top three highlights from the world of work this year are:

• Digital everywhere: Governments and organizations finally shifted from doing digital (incremental) to being digital (cloud first). However, with only 20% of organizations in the cloud, I think the next 5 years will see a big focus on CEO’s re-platform companies and even whole industries to the cloud. This trend line will accelerate as countries increase their spending on IT from 5-10% of GDP.
• Connected ecosystems: The global pandemic showed us that everything and everyone is connected and the numbers tell the story. According to McKinsey, ecosystems represent a revenue pool potential of over $60 trillion dollars by 2027. The future is ‘eco, not ego’ with Costa Rica like ecosystems that capture and deliver value beyond our imagination and new leadership and talent models that are ‘humanity first’. Innovation travels faster through networks than hierarchies. Just look at how BioNTech’s Ugur Sahin and Ozlem Tureci developed a COVID-19 vaccine in less than a year, a truly remarkable business and scientific success.

• Distributed leadership: The pandemic showed that for many organizations the old work and talent models are broken. The future of work is arriving faster than ever before. Leaders are moving from command and control to care and co-creation. The best way to outpace disruption is through workforce capability: more human-led, but tech enabled, intentionally diverse, purpose driven, operationally nimble and built for speed. It’s time for leaders to go big on meaning and remember that leadership is about ‘we, not me’.

The New Meta

Leaders must master the new logic of competition. You’re competing on learning, ecosystems, physical and digital (phy-gital), imagination and resilience. Every organization must now be in a perpetual state of beta creating zero-friction, personalized and predictive experiences for customers on the outside and workers on the inside. How will you win the race to re-skill and up-skill? General Motors (GM) CEO Mary Barra made a fast pivot to producing masks and ventilators and accelerated its transformation to an all-electric future.

AirBnB CEO Brian Chesky is my nomination for the most resilient leader of the last year. It took 12 years to build the home-rental platform and they lost almost everything in six weeks. However, AirBnB, like most agile and resilient businesses, has what I called the Benjamin Button effect. This means three things that every leader should pay attention too: visionary capital, velocity and vertical integration. Today, AirBnB is valued at over $100 billion dollars and continues to turn adversity into advantage.

CEO Jack Dorsey has taken the bold move to give the entire workforce the flexibility to work from anywhere. The bottom line is that behind the scenes, digital superpower companies such as Amazon, Google, and Microsoft have already re-engineered their business models and entire operating models around software, data, and AI to power a completely new breed of organization. Now is not the time to adopt a ‘wait and see’ strategy. As agents of change, it’s time for leaders to rip up the rulebook on leadership and move beyond disruption.

Be More Human

People want to feel more alive at work. Personalized well-being programs will become the norm for workers. Leaders who overlook this critical workplace trend  will ultimately erode their workforce capability and lose out on the war for talent.

Our well-being and mental health are under attack. Information overload, digital distractions and the cult of accessibility mean that for many of us, the default setting is ‘always on’. The World Health Organization has declared “burnout” to be an occupational phenomenon that undermines how well people perform at work. For HR and business leaders, conversations about our collective future — and its impact on our health, wealth and well-being dominate the airwaves. How equipped are we to embrace permanent remote working? What are leaders doing to improve mental health and well-being outcomes for those impacted by the COVID-19 crisis? We’ll see a long-overdue acceleration of organizations caring about employee well-being from the day they start to the day they finish. Thriving employees — defined as flourishing in terms of well-being, mental health and career — are three times more likely to work for a company that they perceive as caring. 

Trust is the ultimate human currency

Trust is a leader’s North Star for prioritizing all ethical and moral decisions. It’s not just about a career, it’s about legacy. With a new, more responsible mandate emerging, the challenge for business is to rethink what makes corporations successful. Although most leaders agree that the organization’s purpose should extend beyond shareholder primacy, only 35% deliver on a multi-stakeholder model today. Empathy sits at the heart of a new mandate. With so many unknowns, how can companies, individuals and society as a whole win? By combining a left-brain understanding of commercial realities and their knock-on effects, with right-brain skills such as intuition and creativity to find solutions. Only then can we turn our insight and intelligence into inclusive prosperity. Thriving employees are twice as likely to work for an organization that effectively balances EQ and IQ in decision-making — something less than half of the companies get right today. Moving the needle on this agenda means putting human and economic metrics side by side, caring enough to place responsibility for long-term futures above short-term gains, and creating space for people to be their whole selves. This is empathy, and it is needed for winning in an evolving world. 

The C-suite regards scaling empathy as a top talent investment capable of driving business advantage and yet according to Hack Future Lab, just 34% of HR and business leaders are investing in this as part of their future of work strategy. Why? In some part because employees are more likely to feel a strong sense of what the late psychiatrist Oliver Sacks called the 3B’s: belief, belonging and becoming. That is, at the deepest human level, humans need something to believe in, a strong sense of belonging and to be in a perpetual state of ‘beta’, which means lifelong curiosity and learning. Companies such as games developer King and microblogging platform Twitter report that when empathy is rated as a strength, employees are twice as likely to say their organization is transparent about which jobs will change, and rank uncertainty last in reasons for feeling burnt out. Employees who work in empathetic cultures are also three times as likely to be satisfied with the company, with no plans to leave.

Do you bake empathy into the DNA, strategy and day-to-day operations of the organization? How do you measure empathy across the whole stakeholder mix from employees, to customers, suppliers, investors, analysts and the media? How is your organization helping its employees to be more empathetic in their daily roles and responsibilities?

Questions are the answer

What questions do you want to be remembered for? I believe when leaders are operating at the edge of uncertainty, questions matter more than answers. Questions are like the golden key that can unlock the door to see the world differently and spot better ways of working or making customers’ lives easier. 

Imagine if you and your team stopped for 4-minutes every day to ask new questions. New questions to old problems and new questions to new problems. That’s 24 hours’ worth of new questions per year. Here are some big catalytic questions for leaders to ask today.

• What will it take to win the ‘20s and beyond?
• Do we have a culture that empowers people to run at the hardest problems?
• What are our blind spots as leaders?
• How are we elevating human potential alongside machines?
• How do we fight complexity with simplicity?
• How do we make strategy and transformation more inclusive?
• Which old mindsets, mental maps, assumptions and operating models do we need to eliminate?
• Is today’s approach to leadership inclusive and sustainable? 

Gradually, then suddenly

The Japanese word Henka (変化 means perpetual change and transcendence and takes its inspiration from nature. It’s turning lead to gold or a moth to a butterfly. Agile, daring and anti-fragile cultures happen by design, not accident. For example, Orsted the world’s largest wind farm operator has transcended from a fossil fuels company to a global renewables business. Now it leads with context rather than control and prioritises values rather than rules. This mindset pivot to context rather than control ensures high ROI. I propose a new humanity first metric called Return on Intelligence and Return on Integrity. While the 20th century was about scaling control and efficiency and doing things right rather than doing the right things, the winners of tomorrow will scale freedom, inclusion, trust, humanity AND intelligence. 

Are you ready to lead for tomorrow’s world?

Terence Mauri is founder of Hack Future Lab, a global management think tank and a top rated  keynote speaker on the future of leadership. He has been described as ‘an influential and outspoken expert on the future of leadership’. His new book The 3D Leader: Take you your leadership to the next dimension is out now.