The world is facing significant disruption and increasingly urgent global challenges affecting individuals, families, organizations, governments, and society. This VUCA-driven (volatility, uncertainty, complexity, and ambiguity) age of disruption brings new complexities, opportunities, as well as risks for businesses (Bawany 2020). The potential for crises has intensified, driven by rapid technological change, and amplified by societal expectations linked to environmental, social and governance (ESG) phenomena.

Throughout the COVID-19 crisis, we’ve seen an acceleration of these trends. We have seen how some businesses have been successful in looking beyond the pandemic and into recovery, while others have failed and many perished, especially the small and medium enterprises (SMEs).

The global outbreak of coronavirus (COVID-19) has created significant challenges for leaders at all levels in industries across the world. A post-pandemic era will require us to embrace new definitions of leadership. The disruptive and seismic effect of the pandemic was felt by organizations across diverse industries. Leaders and employees all are asking far-ranging questions about the future: What will be the legacy of the pandemic? What kinds of leadership skills will they need to successfully navigate the various challenges ina disruptive and digital-driven workplace? How do organizations balance business sustainability and risk management while supporting the needs of the various stakeholders including their employees?

Those who have been leading organizations for some time will attest to the fact that disruption, in its various forms, can happen at any time, in any market segment, or any industry. The reality is that its impact on traditional organizations can be disastrous if not managed effectively. It has and will continue to fundamentally change the way we live and work in decades to come. A leader must see beyond the horizon to anticipate these possible disruptions and develop relevant strategies to mitigate the associated risks.

Today’s global disruptions (e.g., geopolitical tensions, supply chain bottlenecks technological innovations, and climate change)and economic headwinds (e.g., soaring inflation, rising interest rates, decelerating growth, and currency fluctuations) have created a complex, once-in-a-generation, competitive environment with significant variations across geographic areas and sectors.

Navigating this unprecedented complexity requires business leaders to develop a dynamic perspective not only on the most likely scenarios for how their operating and economic environments will evolve but also on the distinct opportunities and risks these scenarios present for their organizations.

The right leadership is critical for organizations to thrive in an era of a constantly disruptive business environment. The book aims to answer the following questions:

  1. What are the megatrends of future disruptive forces that organizations need to take into consideration in their crisis management and business sustainability plan?
  2. How do organizations negotiate the new balance of ‘enterprise risk management’(ERM) with corporate sustainability?
  3. How do leaders transform their organizations to be agile, adaptive, and innovation-driven in the era of constant disruption and crisis?
  4. What are the key considerations for an organization to consider as they adopt digital transformation to reinvent people, processes, and technology in the disruptive World-of-Work (WOW)?

The New Realities

The world is facing significant disruption and increasingly urgent global challenges affecting individuals, families, organizations, governments, and society. This VUCA-driven (volatility, uncertainty, complexity, and ambiguity) era of disruption and crisis brings new complexities, opportunities, as well as risks for businesses (Bawany 2023). The potential for crises has intensified, driven by rapid technological change, and amplified by societal expectations linked to environmental (net-zero emissions), and social and governance (ESG) phenomena that would impact the World of Work (WOW).

Throughout the COVID-19 crisis, we’ve seen an acceleration of these trends. We have seen how some businesses have been successful in looking beyond the pandemic and into recovery, while others have failed and many perished, especially the small and medium enterprises (SMEs).

Today’s global disruptions (e.g., the new world order, geopolitical tensions, supply chain bottlenecks, technological innovations, demographic shifts, and climate change) and economic headwinds (e.g., soaring inflation, rising interest rates, decelerating growth, and currency fluctuations) have created a complex, once-in-a-generation, competitive environment with significant variations across geographic areas and sectors.

Navigating this unprecedented complexity requires business leaders to develop a dynamic perspective not only on the most likely scenarios for how their operating and economic environments will evolve but also on the distinct opportunities and risks these scenarios present for their organizations.

The ongoing Russia – Ukraine conflict since February 2022, marks a devastating shift across the worlds of society, geopolitics, and business – they will not be the same for a long time. Yet the war is only the latest in an increasing number of unexpected disruptions impacting the global economy, and it won’t be the last.

Over the past 20 years, successive economic and geopolitical crises have quickly sent shockwaves throughout the world, affecting every country, economy, trading relationship, and business operation. Amid continuing uncertainty around how the war in Ukraine may end or escalate, business leaders are faced with the challenges of navigating in the dark, accelerating already urgent transformation plans, and building organizational resilience for impacts that may yet strike.

The disruptive events of the past often have had short-term business impacts as leaders seek to return to a state of normalcy. However, we are now in an era of cumulative and extreme disruption that should more sustainably change future decision-making. For example, some immediate consequences of the war in Ukraine could be medium- to long-term sanctions and countersanctions, commodity shortages, and supply chain disruption — so companies need to factor them in as part of their agenda.

To achieve achieving organizational high performance in an era of constant disruption and crisis, both agility and resilience are important.

Agility refers to the ability to make a rapid change and achieve flexibility in various aspects of the operations, in response to changes or disruptive events in the external environment. It can also be viewed as the capacity for responding with speed and flexibly and decisively towards anticipating, initiating, and taking advantage of opportunities and avoiding any negative consequences of change.

Resilience refers to the ability to anticipate, prepare for, and recover from disasters, emergencies, and other disruptions, and protect and enhance workforce and customer engagement, supply network and financial performance, organizational productivity, and community well-being when disruption occurs. It can also be viewed as the capacity for resisting, absorbing, and responding, even reinventing, if necessary, in response to fast and/or disruptive change that cannot be avoided such as ‘black swan’ events.

The leadership skills of the future should be built on what was needed in the past years – the ‘human’ side of leadership, including compassion, empathy humility, and vulnerability.

Our global research involving interviews with 529 c-suite executives (CEOs and their direct reports) around the world (North America, EMEA (Europe, Middle East, and Africa), and APAC (Asia-Pacific) have identified the top disruptive global trends that senior leaders anticipate affecting their organizations and also the specific plans implemented to address the crises resulting from the COVID-19 pandemic and the technological revolution & innovative disruptive technologies impact at the workplace.

The successful leaders who thrive and managed the disruption during these crises have demonstrated specific competencies which we have framed as the “C.R.I.S.I.S. Leadership Model” (See Figure 1) as published in our latest book on “Leadership in Disruptive Times: Negotiating the New Balance” (Business Expert Press, 2023).

Figure 1: The “C.R.I.S.I.S. Leadership Model”

Reference: Bawany, S, (2023) “Leadership in Disruptive Times: Negotiating the New Balance” (Business Expert Press LLC, New York, NY)

THE “C.R.I.S.I.S.” LEADERSHIP MODEL

COMMUNICATE: Particularly during a crisis, the ability to genuinely and effectively empathize with the people affected can make all the difference regarding whether a leader will succeed or fail. Never before have leaders been under such intense scrutiny from their stakeholders aimed at assessing whether they demonstrate the care, authenticity, purpose, and values that organizations profess to subscribe to.

Our recent research has found that inspiring and transformational leaders during times of crisis tend to seek out and act on the counsel or advice of others. They also have a team of advisors that can offer as many perspectives as possible on their situation be it organizational or leadership challenges. The best practices adopted by these leaders include asking themselves the following questions:

  • “Do I have access to diverse voices and sources of information?”: They adopt scenario planning to determine whose knowledge or expertise they might need in various kinds of crises and identify whether their organization currently has access to it.
  • “Do I routinely consider other team members’ ideas or feedback when making decisions?”: They sought out expertise to fill their blind spots and make informed decisions. Effective crisis leaders are those who know when—and how—to defer to others.
  • “What systems or processes might I put into place to surface and capture others’ perspectives?”: They look at how communication is structured within their organization and whether there are barriers or silos that they need to proactively address.

RESILIENCE: During times of crisis, leaders need to be calm and sustain their energy levels under pressure, to cope with and adapt to disruptive changes. They bounce back from setbacks. They also overcome major difficulties without engaging in dysfunctional behavior or harming others. Resilient leaders are genuinely, sincerely empathetic, walking Compassionately in the shoes of employees, customers, and their broader ecosystems.

The well-being and resilience of self and others are more important now than ever before. Role modeling around well-being will be important for leadership success as well as the need for clear messaging on psychological first aid, well-being, and mental health from the business.

INTELLIGENCE: In times of crisis, business intelligence is an area that leaders can leverage successfully when revenues are decreasing and budget problems come into play. By leveraging business intelligence and big data analytics, leaders will be able to discover things that are not obvious or that they didn’t know, such as the root cause of those revenue drops and how they affect specific levers within their organization.

SHIFT MENTAL MODEL: In a crisis, leaders are compelled to try to implement measures that they have never attempted before. When a leader adopts a growth mindset in a crisis, the path to change tends to be less arduous as individuals with a growth mindset believe their talents and abilities are developed through self-development and practice. They are open to new ideas and learning and see failures as opportunities.

INSPIRING: During crises, leaders need to demonstrate inspirational and transformational leadership styles. Trust is more valuable than ever during times of crisis because it not only promotes resilience in the face of uncertainty but also provides solid ground for action and results in better financial performance. When leaders and organizations are centered on an authentic purpose, employees feel that their work has meaning. Research shows that employees who feel a greater sense of connection are far more likely to ride out volatility and be available to help companies recover and grow when stability returns.

SET THE GROWTH PATH: One of the biggest questions employees have asked their leaders during the current pandemic is when this coronavirus madness will end so that they can get back to normal or business as usual. The reality is that it is going to be business as unusual. To prepare for the “new normal” or the “next normal,” leaders need to answer the question “what can I do now to prepare for when things return to a new normal?” To achieve this, they need to reflect on what has happened and what lessons they have learned and then plan to start with a new vision.

They need to connect the conversation about why they and the leadership team are embarking on preparing the organization for the future, what the outcomes are likely to be, and how to go about it. Leaders need to stay firmly grounded in questions like “what’s our goal here? What does success look like for us?” Leaders need to build a culture of accountability, foresight, a “people-first ahead of process and technology” mantra, and decisive adaptability.

For many organizations, this means asking their workforce to work from home. If you are preparing for increased remote work, ensure that the organization has in place the right technology and the technical capacity to support it, including bandwidth, VPN infrastructure, authentication, access control mechanisms, and cybersecurity tools that can support peak traffic demands. Many leaders have confessed that their organizations were not ready for this!

Balancing Act of Transforming the Organization for Agility (Speed) and Sustainability

The Balancing Act

Combining Resilience and Agility to Thrive Through Disruption

As it turned out, COVID-19 was less a ‘Black Swan‘ (catastrophic but highly improbable) than a ‘Gray Rhino‘ — a big grey beast lumbering along the horizon and then suddenly charging ahead as a high-likelihood, high-impact event. The COVID-19 crisis proved to us all that resilience alone was not enough to survive disruption. Firms also needed to be able to adapt to the uncertainty of the ‘new normal’ – they needed to be agile.

Building organizational agility into ‘business-as-usual’ has been a challenge for decades and organizations are often impeded by the leaders’ and managers’ lack of disruptive mental agility and suite of disruptive leadership competencies. Many of them have a misguided belief that agility and resilience cannot work together. On the contrary, our research has shown that the two can be complementary.

Today’s business environment demands organizations to adopt organizational learning as a source of sustainable competitive advantage. This means they need to learn to scale and deliver growth at clock speed while enabling agility and sustainability.

Enabling growth today in an era of constant disruptions and crises would require a deliberate focus on elasticity: building agility and sustainability into the design of the organization while ensuring that the business can meet strategic business objectives and goals. Companies need to adhere to evolving societal standards and operate using sustainable business practices to scale and drive growth. Opting in or opting out of sustainability is no longer an option. Sustainable organizations expand the term “performance” to optimize environmental, social, and governance (ESG) outcomes as well as financial results. Since the relative emphasis on these outcomes changes over time along with the methods for achieving them, there is no sustainability without agility. Indeed, the digital era has revealed the implications for the effective design and implementation of agile and sustainable organizations.

Reshaping Your Organization In an Era of Constant Crisis & Disruption

Megatrends of Future Disruptions-800

Organizations must be prepared for future disruptions which would evolve into crises if they are not prepared. that place importance on resilience now, only to let become an afterthought later, will do so at their peril. COVID-19, with all its indirect impacts, is the most immediate critical event organizations face so far in this decade, but it is hardly the only one. There will be other potential forces that are creating new and constant waves of disruption — creating both opportunities and risks. These includes:

  1. New World Order (Globalization and Populism)
  2. Geopolitical Power Shifts (Russia-Ukraine Conflict and South China Sea Disputes)
  3. Environmental Shifts (ESG, Climate Warming, and ‘Net Zero’ Emissions)
  4. Future Pandemics (H5N1 Highly Pathogenic Avian Influenza also known as ‘Bird Flu’ ),
  5. Demographic shifts (Ageing Population and the rise of Generation Z/Digital Natives) and
  6. Technological shifts (Metaverse, 6G/7G, and Quantum Computing)

Companies experiencing fast growth must build an agile and sustained organization designed to rapidly deploy and redeploy talent and resources without denigrating operational capability in other areas. Capability building includes everything from training on how to run virtual meetings and executive coaching to workshops focused on teaching fundamentals around how to lead change. While companies face a significant opportunity to expand and realize revenue and profit growth, they may not always readily have the organizational capabilities to do so effectively. Why? For one, external disruptions to a given market (e.g., new regulations, innovations, customer performance requirements) can quickly make current business and/or operating models less viable. Organizational designs must be able to outpace disruptive changes of environmental jolts, economic shocks, and more classical reorganizations.

To evolve, organizations need to develop continuous change capabilities. For organizations seeking to scale and grow, not only should their leaders inspire change and be effective ‘change agents”, but they also need to adopt an integrative and future-focused approach to their strategic redesign, allowing them to integrate structure, people, process, and technology (PPT) as leverage points to drive growth. Engaging leaders at all levels and aligning their growth and disruptive mindsets and providing the relevant incentives to reinforce new behaviors go a long way toward executing large-scale organizational design efforts and growing the company.

Our research on best-in-class organizations that have successfully navigated the disruptive challenges took concrete steps to dramatically improve their capacity to anticipate, respond to and capitalize on the disruptive forces heading their way. As a result, we have developed the “L.E.A.D.E.R.” Framework (see Figure 2) for organizations to prepare for the era of constant disruption and crises ahead that could threaten the organization’s sustainability:

Figure 2: Navigating Disruptive Challenges with the “L.E.A.D.E.R.” Framework

Reference: Bawany, S, (2023) “Leadership in Disruptive Times: Negotiating the New Balance” (Business Expert Press LLC, New York, NY)

L: Leverage organizational learning as a strategic advantage:

Organizational learning and management are at a transition point because of the shift in disruptive digital innovations. There is widespread recognition that investing in organizational learning drives change and innovation.  Today’s organizations are operating in an environment characterized by high uncertainty, risk, and turbulence, for example, natural disasters, terrorist attacks, corporate scandals, and major product defects, to name a few. These unanticipated crisis events, small- or large-scale, naturally occurring or human-induced, have a far-reaching and significant impact on organizations and individuals within.

Avoiding or reducing such impact requires not only effective crisis management practice but also significant learning effort from everyone in the organization. Meanwhile, as the environment grows in complexity, it is more apparent that the rate at which organizations learn may become the determining factor in their ability to survive or adapt. Within such a context, constant and continuous learning has become a necessity rather than an option for organizational survival, adaptability, competitiveness, and long-term viability.

E: Embrace experimentation and an innovation-driven organizational culture for preparedness:

Change is imperative. Yet many organizations’ large-scale transformation initiatives meet with setbacks, delays, and even failure. Those that succeed are soon confronted with a painful truth: they are not leapfrogging. At best, transformation can put these organizations on par with their newer, more nimble competitors. As the pace of change continues to accelerate, organizations across various industries are seeking a way forward. Developing an innovative-driven organizational culture can help organizations to withstand disruption in the future, and it also offers important benefits today.

While all innovation requires creativity and action to deliver value, crisis-driven innovation demands creativity and action under pressure — and oftentimes constraint — in response to a disruptive event or trend. Understanding the psychology of crisis-driven innovation is an essential component of building a more resilient future and creating crisis-driven innovation principles. Successful organizations run through the crisis-driven innovation principles by applying the “think, do, apply” model, cycle testing different scenarios and ways of working as you explore new ideas and potential solutions. They keep learning and experimenting.

A: Foster organizational agility and speed:

Organizational agility requires a cadre of ‘disruptive digital leaders that can anticipate business changes, stay flexible to adapt to shifts in the market and initiate change in their organizations. It’s the dynamic organizations that have a much better chance of surviving – and even thriving – in the shifting business environment. Embracing new ways of working and making decisions can help firms avoid becoming mired in the bureaucracy which can bring change to a screeching halt.

It seems obvious that when faced with a crisis, organizations should simply ramp up more speed and agility to seize an opportunity. But not all organizations do. Speed is not simply an attribute of an organizational activity tied to clock time. Rather, speed is a complex, performance-enhancing organizational capability that requires a holistic approach to its development and execution. Speed alone enables companies to operate quickly only in already established product domains. During a crisis, companies must also demonstrate agility, a capability that allows the organization to pivot to adjacent or entirely new product domains.

D: Decisiveness and rapid decision-making:

Agile organizations navigated the initial impact of a disruptive event and crisis better than most. One reason is that they delegate decision-making to frontline employees and to other critical roles where value and risk are concentrated. Yet, delegating does not mean leaving people on their own; rather, it is about coaching (not micromanaging) decision-makers to make successful decisions, providing guardrails, and empowering them to make final decisions.

Making decisions faster inevitably means mistakes will happen. However, organizations should adopt experimentation and give employees room to make those mistakes—as long as they don’t threaten the business. Our research unveiled that best-in-class organizations take steps to build risk mitigation into their decision processes. This lets them continue to move with speed: moving forward with implementation and quick test-and-learn cycles that allow for nimble adjustments and open doors to opportunities.

E: Empathy and empathetic listening:

Empathy affects our ability to adapt and achieve results. It is the capacity to understand what someone else is experiencing. Leaders who practice empathy consider what people in the organization are experiencing through their frame of reference. When leaders are being profoundly impacted personally and professionally, it’s important to check in with people regularly. Asking someone how they’re doing takes on a whole new meaning and dimension during a time of massive disruption.

When you take a moment to connect with someone, you create the right experience for employees. During times of crisis, empathy is of great importance as our research has shown that leading companies that pivot from marketing to helping and from fulfilling customer desires to meeting customer needs have achieved great results. These socially conscious organizations across sectors and geographies are finding ways to get involved and support their customers and communities. By consciously providing empathy and care during this crisis, companies can build a foundation of goodwill and long-lasting emotional connections with the communities they serve.

R: Resilience in Navigating Disruptive Change:

During times of disruption, embedding resilience at the heart of the organization is crucial for building a foundation for growth, innovation, and pursuing new opportunities. Both leaders and employees at large need to be empowered to take positive action during a crisis and organizations can achieve this by equipping them with the right skills and competencies. By rehearsing different risk-type scenarios, crisis management or response teams can develop the ability to operate effectively even under the most challenging disruptive conditions.

At the same time to successfully navigate extreme uncertainty, effective crisis structures, plans, and processes must be developed to help absorb and recover from the impact of unprecedented or extraordinary events. By managing the response, owning the data, and making better decisions, the organization can move through a crisis and emerge stronger. As a result,  even in a worst-case scenario, you can navigate extreme disruption, protect your people, customers, and business, and build trust with your stakeholders, regulators, and wider society.

Conclusion

The recent COVID-19 pandemic with its devastating consequences has tested political and business leaders globally and has exposed deficits in crisis communication, leadership, preparedness, and flexibility. Extraordinary situations abound, with global supply chains suddenly failing, media communicating contradictory information, and politics playing an increasingly bigger role in shaping each country’s response to the crisis. The pandemic threatens not just our lives and livelihoods but also our economy and liberty as we have experienced during the lockdowns or travel restrictions.

It has also imposed at times ethical dilemmas and emotional stress on both the leaders and the employees at large. Nevertheless, the pandemic as well as other past crises including the Asian Financial Crisis in 1997; the 911 Terrorist Attacks and Global Financial Crisis in 2008-2009, also provides an opportunity for organizations, leaders, and governments to learn from their mistakes and to place their businesses, countries and institutions in a better position to face future challenges.