Home > Blogs > The Transformational Leader – The New Corporate Imperative
We are living in perhaps one of the most enviable periods in human history. Our era is akin to when mankind first domesticated fire, invented the wheel, rolled out the first train, or installed the first telephone system. In fact, the next decade promises to be far more exciting than anything that mankind has witnessed or created over the last 50,000 years of civilization. In one generation, we have already changed the way people live, learn, and labour. It took thousands of years for the agricultural era to mature. It took hundreds of years for the industrial era to mature. It took us a few decades for the Information Technology era to mature. It will take us less than a decade for the information era to mature.
The next generation will look at us and wonder how people were able to live in such a primitive manner.
And yet, this promises to be just the beginning. From the beginning of the millennia, management gurus have been stating that corporates are living in the context of a VUCA world. Despite many new ideas and thoughts emerging on how to manage and thrive in this new paradigm, upstarts and brats continue to overthrow well-entrenched players across industries.
As always it is about leadership – and their ability to lead large organizations as if they were a start-up.
This is not the time for faint hearted leaders caught up in a post-colonial fixated paradigm – where hierarchies ruled, seniority meant importance, and a long- term vision spoke of a 7 to 10 year period.
It takes a new kind of leadership to lead this “Brave New World”!
Leading in the VUCA reality
Vision to manage the Volatility
It is difficult to predict the nature and dynamics of change. Is it driven by technology, by new business models, by social changes, or by political upheavals? Every one of these changes is catalyzed by other factors. Changes to business models are catalyzed by the ease with which secure inter-border transactions are possible using Blockchain technologies. Blockchain on its own is a tool (like a hammer). When put to effective use, it dramatically creates an opportunity that businesses can leverage. It is the leadership’s job to identify such opportunities in the fast-changing world.
If such changes are to be managed, it is necessary that the organization has a clear vision and is able to live to that vision daily. It is necessary to frequently revisit the vision. But the temptation to change it must be contained – merely because the change catalysts have changed, or newer catalysts have emerged.
Understanding to handle the Uncertainty
The corporate world today is almost defined by the surprises that it wakes up to everyday. It is difficult to predict or even sense the import of an event. And in many cases, leaders are caught by surprise because they are unable to understand why a situation or an opportunity unraveled the way it did.
It is in this context that a leader must be able to generate an understanding of the world around him or her. Without understanding, it is difficult to take decisions and move ahead. Leadership was always challenged by the uncertainty that the future held. Entrepreneurship per definition was defined by the risk the entrepreneur was willing to take. In today’s corporate world, all leaders are expected to behave like entrepreneurs. In addition to seeking understanding for themselves, it is also important that they are able to drive the organization to action, based on this understanding. In more cases than not, it means significant change across many dimensions of the organization – structure, culture, process, competencies and so on.
In essence, build a learning organization that is constantly evolving based on the changes in the ecosystem in which it functions.
Clarity to simplify Complexity
Today’s operating environment is defined by the complexity of a different order. It is not the complexity of our grandparents or even our parents. Cause-effect relationships are not linear. A flat globalized world creates chaos of an order unheard of before. An election in one country impacts the stock exchanges in many others.
In this milieu, it is necessary for a leader to be able to cut through the fog and provide clarity of thought to the organization. The leadership can ill afford to be confused by the chaos that rules supreme. They must be able to filter the signal from the noise and make meaningful decisions. Clarity is achieved by sifting data and information into business insights. By moving from looking at individual events to seeking out patterns. By experimenting, learning, and changing.
Agility to deal with Ambiguity
Ambiguity in today’s economy and market arises from the Volatility, Uncertainty, and Complexity described earlier. This ambiguity creates confusion in the mind of the observer, giving rise to potential misreads. The challenge is to be comfortable with the ambiguity that refuses to go away and yet steer the organization with a firm hand.
Ambiguity per definition implies that the future can change at a moment’s notice. Techniques like scenario planning are useful – but costly. Scenario planning prepares an organization for a future that can change. Leaders, on the other hand, need to learn to be agile. Agile in their thinking, their decision-making, with a willingness to change processes and cultures as necessary. Long term planning today rarely lasts more than a couple of years in most industries. The leadership and consequently the organization must be capable of changing direction mid-course because the external world has changed so much in the interim.
Enter the Transformational Leader
Transactional leaders who strove for efficiency and effectiveness will find it difficult to survive and steer an organization in today’s age and day. The future belongs to Transformational Leaders.
James McGregor Burns introduced the concept of “Transformational Leadership” in his seminal book, "Leadership." He defined it as a process where "leaders and their followers raise one another to higher levels of morality and motivation."
Transformational Leaders are those that can change organizational cultures, the way their stake holders think about their business, and most importantly influence markets in their favor.
These kinds of leaders are able to create an inspiring vision and motivate the organization towards delivering against this vision.
Transformational leaders are the proverbial commanders at the war front. Able to instill a sense of purpose, inspire a dream that smells of victory, and challenge any self-limiting beliefs that can prevent them from destroying their enemy.
Transformational leaders can:
1. Create and retain a clear vision.
2. Communicate this vision into the organization.
3. Provide clear instructions on how to deliver against this vision despite the changing external scenario.
4. Anticipate and manage risks – while balancing long-term and short-term ambitions.
5. Change organizational cultures. The VUCA world requires a networked organization rather than a hierarchical one.
6. They thrive on diversity – seeking new and different opinions and perspectives constantly.
7. They ensure that employees are at the forefront of whatever they do. To them, employee-engagement is more than a mantra. It is a way of life.
In addition to being world-class at delivery, Transformational Leaders “are” also the following:
1. They are authentic – a model of integrity and fairness.
2. They have a strong value system and ensures that the organization lives to those values.
3. They are curios and constantly learning. Curiosity to understand what is happening in the world around them. Learning from any and every source.
4. They are role-models - able to stir the emotions of their employees.
5. They are inspirational and can motivate people to reach for the improbable. BHAGs seem normal for them.
6. They are big-picture thinkers.
7. They are as comfortable with intuition as they are with data-driven decision-making.
8. They are “comfortable” with being “uncomfortable” knowing that the world out there is very ambiguous.
9. They do not have any holy cow – and can very quickly change their own approach if the situation demands it.
In essence, the current market reality of a VUCA world needs a different kind of leadership. Leadership that dares to take risks, challenge their organization, and ensure the continued success of their organization.
Transformational Leaders are resolute in ensuring that the organization does not merely do what it can do but does what it should do! Deliver to its potential with integrity and a value-driven culture.
About the Author
Bhaskaran Srinivasan is the Director of Academics for Manipal Global Education Services. He is responsible for the quality of content and pedagogy. He is also responsible for ensuring the high quality of faculty used to deliver the best knowledge to all programs. He works with the Banking Academy, the Global Nxt University, the IT Academy, and the Data Science Academy.