When the GFC hit between 2007-2009, what was the response from most companies? Chaos reigned and panic ensued, and the leadership practiced, in most (not all) companies was reactive, defensive and short sighted.
Let us not be too hard on these leaders and companies, because you and I know, that the extreme weight of responsibility to act quickly and stop the bleeding, drives urgent behaviour. However, if we want to accelerate out of the downturn, we need to demonstrate situational awareness in order to keep context. How can we do that?
We can learn from the military.
An Army never campaigns without this ‘cascading’ leadership. They develop their leaders with a deep appreciation of the tasks, objectives and constraints of the level two above! The Army call this understanding the ‘higher commanders’ intent’.
This understudy approach to developing leaders empowers decision making, encourages taking initiative and collaboration, which in turn creates engagement. The impact of which are a trust ‘felt’ throughout the organisation in the quality of the execution activities and a continual leadership pipeline.
The theatre of crisis highlights how critical it is to not lose the lead and how important it is to learn at every opportunity, so that we may use this moment to develop our leadership capacity at every level, in order to minimise risk of such a loss. (this is also evident in the arts theatre, where there is always a stand-in should the lead get sick or be injured at short notice)
Ironically, the military have been seen as purely a command and control type of leadership, but my experience was one of clear boundaries (left and right of arc), a focus on developing competence and autonomy within those boundaries. Certainly, the special forces have lots of autonomy and extremely high competence. They also have extraordinary levels of innovation and agility. These characteristics, I believe, are well suited to the current global situation and for leadership in the future.
An HBR (2010) article called, Roaring Out of Recession (Gulati, Nohria and Wohlgezogen) highlights the type of approach that is needed to not only survive the crisis, but also to thrive once the crisis is over. They called it “Progressive Focused”
I liken this to having two lenses; the first is focused on the immediate response to the threat (cost reduction and survival of the business) and the second lens that is focused on allocating more resources to R & D, sales, acquisitions and new emerging markets (the future growth of the business). Like playing ‘defense’ and ‘offense’ simultaneously.
The cost reduction focus for these progressive leaders, was not slash and burn, though some redundancies were inevitable, these leaders focused on reducing operational costs by pursuing operational efficiency. The mindset that this creates through communications, dialogue and language is constructive and leads to a commitment to improvement not reduction.
It is this focus on improvement and engaging peoples executive thinking that provides the basis for reducing costs for the present and into the future! The culture in the company becomes united and solution focused toward a common mission of efficiency and opportunity.
What underpins this approach is a learning mindset.
The companies that react to crisis by stopping all expenditure send a message received as, ‘stop learning and keep doing!’ or aim low and keep innovation as a low priority. They also try to do more with less, which often results in lower quality.
From personal experience, I can tell you that a crisis is the ideal time to learn, to sharpen our leadership tools and to refine our operations.
In February 2018 the Southern Highlands of PNG suffered one of the biggest Earthquake in the Southern Hemisphere. Over 170 people lost their lives and over 250,000 were displaced. Millions of tonnes of earth slid down mountain sides. If it were a city, I shudder to think of the lives that would have been lost!
I had just joined an oil company operating out of the Kutubu region of PNG. It was my third swing (28 days on 28 off). I was told to stay home and wait. After getting a little understanding of the situation, I let it be known that I would like to volunteer to assist in any way that was useful. The company was appreciative and duly flew me into the epicentre to coordinate relief efforts for the local communities, many of whom had suffered immensely.
It was extremely stressful for all the villagers and relief workers as well as the company skeleton operations staff. Aftershocks were large and frequent. I was feeling the pressure and I needed to recall the lessons that I learned in the Royal Marines Commandos (Her Majesty’s finest).
I quickly established an operating rhythm for myself and the team. Within that rhythm was daily AAR (after action reviews). This is a learning cycle that reflect on what you had planned for, what actually happened (good and bad) and then a group discussion to brainstorm improvements and a final commitment to action.
After a few weeks of 12-14 hour days, we were blessed with a days R’n’R (rest and recouperation). Rather than totally waste this, I made a suggestion to the team – we could sleep in, eat a big breakfast and then come into the war room to do some planning for the next phase of relief. They all agreed readily and when the day came, they turned up to work out the plan for the next phase. I handed over the leadership reigns to one of the team (a citizen from PNG) who facilitated the whole process. The outcome was a where leadership was cascaded throughout the team, decision making was aligned, communication was coordinated, and the commitment was all inclusive.
My point is, that even though we were in the midst of a crisis, I looked for opportunities to develop my team members. They led briefings with the Prime Minister our CEO and other key stakeholders, they ran problem solving exercises and they practiced autonomy on the ground, continually learning and improving as they went.
The military taught me the benefit of learning in the thick of it, and that a successful organisation (of which I feel the military is one), must have leadership at every level.
The mindset that leadership must adopt in the current situation and into the future, is a learning one. Organisations that don’t pursue this mindset will become static and perish!