I believe this discussion about entrepreneurship, innovation and leadership needs to start with a better understanding of purpose. The reason is
Recently, I’ve been thinking a lot about what it means to lead during a crisis. No wonder! I’ve just left Ukraine where I served as Managing Director during its ongoing geo-political crisis, and before that I was Managing Director in Greece when my home country fell off an economic cliff – and unfortunately is falling still.
Not only the climate but the whole world around us is warming up. The scarcity of resources, the energy, the imminent battle for water, the inequalities in wealth dispersion – never have these conflicts been as high as today. 9,10,11 billion demanding people are squeezed onto the same planet, which is unable to cater to their needs. Crisis is almost inevitable around the world – today Ukraine and Greece, tomorrow the Middle East and North Africa or how about California, Brazil, Mexico, and Canada!
In an era such as ours, what should organizations look for in leaders to help them through? What characteristics, strategies or actions help leaders weather a crisis successfully?
I did a lot of reading to see what other leaders and leadership researchers have said on the subject. Here are 5 articles I found interesting:
What do effective leaders do differently in a crisis? Seijits says strong crisis leaders:
• Practice foresight
• Have no choice but to be decisive
• Are exceptional communicators
• Are visible
• Connect with the people, even in the midst of the crisis
• Are prepared to take risks
These all struck me as true. But the behavior that resonated with me most – and which I didn’t see in other articles – was the ability to practice foresight.
Seijits quotes a leader who says, “You’ve always got to be thinking: what consequences spin out of these series of decisions?”
I call this the “What If” reflex. It’s essential for leaders to develop contingency plans for every possibility, keep those plans simple, and be ready to implement them when certain trigger points are reached.
2. “5 Things Successful Leaders Do in a Crisis” by Murray Newlands
How do leaders keep their cool in a crisis? According to Newlands, they:
• Don’t let their emotions get in the way
• Are brave
• Are accountable for victories and losses
• Don’t take failures personally
• Have positive attitudes from beginning to end
Newlands is really onto something, I think, when he says the leader can’t take failures personally. This was the biggest lesson I learned in the first crisis I experienced as a leader. When our income plummeted by more than 80%, I felt personally responsible even though the cause of that drop was completely outside of my control. In reality, I wasn’t responsible but it was my job to do something.
On the other hand, when Newlands says leaders are accountable for victories and losses, I feel the leader should give all the credit for victories to his or her team and assume all the blame for failures. You need to take the heat off your employees during a crisis and support them more than you would normally.
3. “Great Crisis Leaders: 10 Key Characteristics” by Pat Rowe
I loved this piece by Pat Rowe and highly recommend it.
According to Rowe, strong crisis leaders see things for what they are and have great awareness for the big picture and the moving parts. They don’t fixate on one answer but consider multiple options. They’re willing to listen to unpopular advice – always a must – and they seek a lot of input and involvement from their team rather than go it alone as the hero.
But my favorite advice from Rowe was to apply the 80% rule. Instead of waiting for the perfect decision, it’s more important for leaders need to move forward in a crisis and fine-tune or fix a decision later. In another article Nine Lessons I wish I had been taught before I called this “get on board, fix it on board”. So true.
4. “How a Good Leader Reacts to a Crisis” by John Baldoni
HBR published a piece by John Baldoni talking about the way political leaders react to a crisis as a way of teaching people in business. I recognized some good points.
• Figure out what’s going on
• Act quickly but not hurriedly
• Manage expectations
• Demonstrate control
• Keep loose
In my experience, the point about managing expectations was particularly relevant. Some people get so wrapped up in how bad things can become that they become paralyzed with fear and worry. Others tend to think things are getting better or looking brighter than they actually are, and can get complacent prematurely. I think it’s good policy to undersell expectations just a little so that people are prepared for the worst and happier when it doesn’t arrive.
5. “Leadership in a Crisis – How To Be a Leader” by Bill George
Finally, this piece by Bill George, former CEO of Medtronic. I met him personally at the Global Institute for Leadership Development (GILD) in 2010 – and I’ll be speaking about crisis leadership there myself in October 2015. George brings a true CEO perspective to the conversation. My favorite point: Be aggressive in the marketplace.
As George puts it: “… a crisis offers the best opportunity to change the game in your favor, with new products or services to gain market share. Many people look at a crisis as something to get through, until they can go back to business as usual. But “business as usual” never returns because markets are irrevocably changed. Why not create the changes that move the market in your favor, instead of waiting and reacting to the changes as they take place?”
I couldn’t agree more. When others are floundering, you have a golden opportunity to position your organization better.
Ten years ago, Marsh and McLennan put out a study on crisis readiness in which it stated that an organization will face a crisis every 4 to 5 years, and a CEO can expect to manage at least one crisis in his or her tenure.
Today, those numbers sound almost naive. Crises, while unexpected by definition, seem almost commonplace.
In my informal research, I found lots of great tips for leaders, and a firm understanding of the characteristics and behaviors that leaders must exhibit to be good crisis managers. But there was one approach I was surprised I didn’t see in more depth.
Few articles touched on how important it is for a leader to build the capacity of his or her team to manage a crisis. In reality, a leader is not a lone hero facing the worst that the world can bring. The leader needs a capable team to manage a crisis effectively. The very recent HBR piece ” What It Was Like to Be a Manager in Ukraine” tries to capture exactly this.
Anyone else out there have an opinion about what people need to understand better when it comes to crisis leadership?
christos tsolkas june 7, 2015
Photo Flickr Cat McBride “162/365, Panic spread slowly throughout the gingerbread men…” June 2011
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