The New Meaning of Leadership in the Era of Constant Disruption and Crisis

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As the world becomes more complex and connected, the threat of a corporate crisis grows. There are instances everywhere: we have experienced first-hand how when a pandemic spreads worldwide, it caused massive global business disruption and a public health disaster; a corruption scandal causes a corporate leader to step down; the sudden death of a CEO without succession planning in place; a data breach shakes customer confidence; quality issues trigger a widespread product recall. These are just a few examples among many of the recent corporate crises.

The right leadership is critical for organizations to thrive in a disruptive business environment. The book aims to answer the following questions: How do organizations balance business sustainability while balancing the needs of the various stakeholders including supporting employee needs in the post-pandemic ‘new normal’? How do leaders transform their organizations to be agile, adaptive, and innovation-driven? What are the leadership skills that are required to navigate the organization successfully during times of crisis? What are the key considerations for an organization to consider as they adopt digital transformation to reinvent people, processes, and technology (PPT) in this transformative era of the digital-driven ‘new normal’ world of work?

  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)?

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)

Organizations face challenges that present varying levels of severity. But handled poorly, even a seemingly minor shock has the potential to escalate into a crisis that threatens the viability of a business. A crisis can disrupt operations, damage reputations, destroy shareholder value, and trigger other threats.

As the business community has learned through the COVID-19 pandemic, it’s more important than ever for leaders to anticipate and plan for the possibility of an unplanned event. The more prepared you are to manage shocks, the less likely you’ll fall victim to the serious harm a crisis has the potential to inflict.

Whereas risk management is traditionally a proactive discipline, crisis management is reactive. Crisis management can be viewed as a specialized discipline within risk management, where specific practices are instituted in response to unexpected events that threaten a company’s stability. Having an effective plan and resources in place mitigates the destructive nature of that reactivity.

Crisis management is one of several interrelated core disciplines comprising enterprise risk management, along with emergency preparedness, disaster response, business continuity planning, supply chain risk mitigation, and cyber liability prevention. Crisis management practices can help lessen the magnitude of emergencies and disasters while decreasing the uncertainty and anxiety associated with these events.

We face a new era of radical uncertainty and disruption brought about by other challenges such as climate change, financial crises, terrorism, Brexit, demographic changes in the labor market, health/disease risk, mass migration, and rapid developments in digital technology and its impact on transformation at the workplace. The management of shocks and crises is becoming an everyday occurrence. Organizations also need to be agile, and leverage opportunities, and drive innovation to remain competitive in the face of challenging conditions.

Negotiating

The New Balance

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

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 while 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

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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.

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)