By RUSSELL RAATH
In business, we continually deal with unexpected or unanticipated changes. You wake up to discover that a smaller player has made a bold bid to acquire a significant competitor – a move that would catapult it into the big leagues – and one that will change how you need to think about the market.
Or your innovative new product that is due out in three months is suddenly beaten to the finish by someone else. Or your data cloud has been hacked, exposing millions of clients’ personal information.
Analysts want to know what you’re going to do – how is this going to affect results, earnings and provisions? Your customers want to know. Your partners, suppliers, and employees all want to know. How are you going to handle this change?
We all know that the best responses are those that invoke confidence, a firm grip on the situation and a conviction that you know what to do. Not just that “you’re working hard to fix it”, but an answer that outlines what you are actually doing to remedy it.
The challenge that we see in our work is that many senior leaders have, over their careers, focused on building skills relevant to their discipline (finances, operations, IT), but they are lacking the additional change leadership experience that organisations desperately need, especially in the C-suite. The Wall Street Journal’s CFO journal once outlined that challenge in finance departments – but we know it’s true throughout organisations.
The fact that top executives feel that their companies have few employees who are able to be highly effective in a rapidly changing environment comes as no surprise to us. Frankly, we don’t do a good job of developing future leaders who are able to function in a rapidly changing environment.
Sure, companies provide functional training for essentials like medical reform or the potential impact of tax changes. But the challenge for companies (and their leaders) is less about this functional knowledge, and more about a C-level executive’s ability to put that knowledge to use in order to act, and react, fast to changes in the organisation and its industry. The banking industry has discovered this the hard way with past costly CEO scandals, and they’ve scrambled to set up succession plans so they aren’t caught again.
Effective leaders, those who can lead their teams through change, are those who have figured out how to get stuff done inside their organisations. And get it done fast. Most individuals can figure out what they would do differently under new circumstances right away – and indeed they would be able to do it – if they were working on their own. But that isn’t how organisations work.
We see a flurry of misdirected activity in the face of rapid change – so many meetings and people talking about what needs to change – but no one is doing anything that is essentially different from what they were doing in the past.
It is only those leaders who really understand change leadership who can do what it takes to get everyone else to focus on the change, too. These leaders can understand the myriad implications and what is needed to make fast, smart decisions.
It is as if they can see ahead of the curve and understand the knock-on effects that no one else is thinking about (yet) in a positive, determined and confident way. In our rapidly changing world, we need many more of these leaders.
The solution to solving this talent shortage? Build it organically. Don’t necessarily focus less on technical skills, but start looking to build the entrepreneurial qualities that smart, successful business owners possess.
(Here’s a hint — they make decisions as the owner of a business does – fast, and with the advancement of the business as the overriding objective.)
And start now, so that you have a succession process that builds on itself. The leaders you grow will help to grow more leaders internally.