Leadership Insights Part 1: Strategy
The current level of disruption and change that businesses face has led to the term VUCA times being coined, meaning: Volatile, Uncertain, Complexity & Ambiguity. Originally used by the American army in Afghanistan and Iraq, it is increasingly appearing in business journals and texts referring to the current climate and environment. This level of turbulence has resulted in the average business lifespan dropping from 65 years to 15 years; leading to increasing demands and expectations being placed on leaders.
Organisations such as BHS, Nokia and Blackberry in the face of increasing pressure have lost considerable market share and ultimately BHS had to controversially fold. A failure to read the environment and respond effectively has caused once market giants to flounder and fail. Increasingly there is recognition that businesses and their leaders need to operate differently in order to succeed in VUCA times.
To keep pace organisations need to be both agile and focused. The businesses need for focus means that strategy must be clearly defined, actively adopted and followed. The most successful strategies have a number of elements in common. Strategy must become tangible, in other words something that people across an organisation can understand and most importantly are clear on how it informs their actions.
A handful of clearly defined meaningful statements will have greater impact leaving the top office than a beautifully scripted long monologue. A great starting place is gaining a true picture of the customer and the needs and requirements the business will service, this knowledge represents critical IP content and should be a central construct of strategy. A key role for leaders is to ensure that they have a strong personal connection with their core customer base and actively seek to understand their needs. Leaders must engage with customer facing areas and maintain a current insight.
Closeness with the business enables leaders to attune themselves to the capabilities and strengths of the organisations people. Where leaders have the knowledge and insight they can position the business strategy to be more flexible and enable it to act more decisively. The strengths profile enables leaders to both leverage potential and opportunities to meet demand and also to increase opportunity to provide fulfilling and supportive employment.
Businesses must remain vigilant and sensitive to potential changes, disruptions and opportunities. Ensuring that the business and its leaders are plugged in; engaging with key groups, holding influence externally and developing understanding of consumers and continuously feeding back this knowledge is critical. Taking and using new perceptions and data to challenge thinking creates the ability to respond in an agile and effective way. Organisational design and the function of strategy must provide for this, it is also fundamental for leadership to plan in and model this important focus.
To be able to deliver an agile culture is vital. Having a dialogic approach where questions, even obvious ones can be asked, where its ok to be wrong and challenging the status quo is normal allows businesses and their people to continuously learn and develop. Peter Senge’s seminal work ‘The Fifth Discipline’ advocates the role of inquiry and dialogue as one of the key drivers in business success.
The way it is done around here is changing constantly, inquiring and maintaining curiosity are highly valued skills. Leaders must create trust that enables the people in their organisation to feel confident to lay themselves open and expose their thinking, to allow them to realise the true value of their staff. This requires a pioneering culture, seen within innovative organisations, that have a balanced view to risk and see the benefits of pushing the boundaries and creating new opportunities.
Within VUCA the potential to place continuous pressure on staff is great. It is critical that the pace and velocity of work protects the wellbeing and interests of employees. Cutting a balance between keeping pace with change and allowing space for creativity and reflection takes real leadership strength and an understanding of people. The leader needs to construct a system that delivers an equilibrium between pace and space. To ensure that whilst the business is driving forward the structure and process of business allows for creativity, collaboration and development to occur.
Underneath it all there is a definite message to keep it simple. Businesses need to distill processes and practices in ways to ensure consistency; being able to replicate and create scale is key. Processes should be developed to ensure a clean transition from purchase to delivery that is reliable and customer driven, making sure the anticipated quality and service meet the value proposition. Unnecessary complexity and measurement driven by KPI’s that are not a requirement of optimising business strategy should be avoided.
Great leadership creates a pathway for the organisations people to deliver at their best and celebrates their success. In part 2 of this series will look at setting an agile structure, keeping it simple and enabling performance.
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