Leadership: an ever-changing roleLeaders of the last 10-15 years experienced a long period of growth, where the biggest Challenge was to find the right people and build the right infrastructure to meet the opportunities companies saw all around them.
During the recession, the skills of our leaders were tested to their limits; it was about cost-cutting and survival. Now that the economy appears to be on the rise again, finding the right balance between innovation, creativity and effective resource planning will be crucial for our leaders if they are to gain the competitive high ground.
There is arguably more requirement for leaders to be creative, take strategic risks and invest in innovative sales and marketing programmes.
What are the Challenges for today's leaders?Leaders will need to show resilience to a changing market economy. They will need to look at outside influences and develop innovation in products, or tap into new markets. At the same time, they will need to match the right people to the right task and motivate them to pull in the same direction.
Effective motivation comes from the ability to communicate clearly to staff so that the direction in which the company is heading is clear and so too are the tasks required of its staff. Staff need to know that innovation will be encouraged and that our leaders are prepared to trust them and be responsible for the successes and failures of the team as a whole.
Tackling the recovery: key skills for leaders
A leader under pressure must demonstrate calm, be even-tempered and lead by example. Composure under stress is probably the most significant leadership trait that will separate good leaders from weak leaders during a time of economic uncertainty.
Taking operational control
Leaders need to be able to make critical business decisions and execute them well to minimise disruption to the organisation. According to Cavenaugh et al (2008) runaway events create anxiety and people look to leaders to regain control of the situation and establish more secure conditions. They need to carefully match financial control with delivery of innovation.
Flexibility and foresight
Executives need to be able to sense a change in the economy and make quick judgments about whether these could be long or short-term changes. They need to keep an eye on the big picture, recognise important indicators of growth or decline and then act quickly to get the organisation on the right track.
In times of uncertainty, open communication, a collaborative, transparent approach and more information rather than less demonstrates strong leadership. Leaders need to communicate hope and be supportive of their staff, without becoming too emotionally involved.
Leaders need to be good coaches; they need to trust their staff to work effectively, yet have clear reporting mechanisms and accountability, to ensure robust operational control. A company needs to draw on its talent and positively welcome new, innovative ideas and better ways of working.
Good succession planning
Emerging leaders need to be recognised and nurtured, as they will be the key to successful growth as the recession lifts. Leadership competency in others should be encouraged and potential derailing traits should be identified and worked on, as part of an individuals professional development.
What problems might leaders face in the recovery?
It's not uncommon for our leaders to de-rail during tough economic times. Lack of resources, greater scrutiny from above, anxious staff and declining profits can all lead to considerable stress on our executives. This stress is likely to continue for a little while yet and so it's important that our leaders identify characteristics which may be suppressed during the good times, but which might emerge during times of stress.
Typical derailing tendencies are:
- inability to make and implement decisions quickly
- micro-management of staff
- bullying and aggressive behaviour
- a shut-down in communication too busy or too difficult to communicate
- lack of clear direction so that more than one person is doing the same job
- rash decisions which tend not to be fully thought through
- resistance to change and new innovations
- pessimistic outlook on the companys situation.
Looking to the future: how can leaders emerge?
Many companies have stripped their overheads to the bare minimum. Those that have been smart will have ensured there is enough capacity to grow without it being too painful an experience. They will hopefully have learned from the experience of the recession and become more resilient as a result. There will have been a lot of personal growth and there will still be times ahead where our leaders need to take the helm and lead by example.
As the economy grows, the main leadership issue will be about keeping and identifying the right people. Capability is crucial, yet many of the behavioural traits that make good leaders remain the same in both the good times and the bad. Some of the negative traits which are suppressed during the good times may emerge during the bad and have the most potential to limit an organisation at a time when they need to hit the ground running.
Success of leadership depends on the people
To support our leaders during this time, they will need to use all the tools available to them, such as better use of technology, coaching and motivation, and a clear professional development path.
The right people will ultimately make the difference between sailing on the rising tide or drowning in the sea of competition.