‘Heretics are the new leaders. The ones who challenge the status quo, who get out in front of their tribes, who create movements.’

Seth Godin, American entrepreneur and author

This chapter covers:

• how the characteristics and emerging trends of today’s world are affecting the issue of leadership
• in these times of change, what new attributes and skills will be required by leaders of tomorrow
• how the leader’s development journey may be built on the foundations of self-awareness, influence and execution.

One of the key leadership attributes is the ability to grasp the environment you are in and stay in tune with it. Leadership is also about looking around you. In order to be able to develop into the leader of tomorrow, it is important to analyse the contemporary world and assess how it impacts the roles and attributes of future leaders.

A fast-changing world

New trends are emerging that put back into the equation values such as integrity and accountability. The world is calling for the reconciliation within organisations of profit and social justice. Technology is empowering and giving unprecedented speed and impact to knowledge. A major demographic shift is pushing diversity and complexity in the workforce. Leaders of tomorrow need to be acutely aware of the environment to be able to adequately perform.

In the first decade of the twenty-first century, Lehman Brothers, a symbol of corporate America, was left to collapse. This opened the debate on the real value of financial services and introduced the notion of moral hazard in a capitalist society.

Not long after, the BP issue in the Gulf of Mexico opened the debate on leadership and accountability – when to discard it and when to retain it.

These were manifestations of a shockwave that hit the status quo, a sign of a deep transformation from an old to a new system.

A crisis of values

One of the emerging trends is for individuals and organisations alike to seek a change to current models. Summarised below are just a few that are relevant from a leadership perspective as they impact human behaviour and thinking.

The Occupy movement

Inspired by the Arab Spring and the financial crisis, this movement stresses the need to rethink and realign economic power and social needs. For its members, it is critical to rebuild a sustainable way of living and embrace democracy.

The Occupy movement also draws on statistics from the Congressional Budget Office report, which notes the concentration of wealth among the top 1 per cent of income earners. These top earners have seen their income triple in the past 30 years, with minimal progress being made by the other 99 per cent.

This controversial international movement has been gaining political importance. The rebalancing of wealth is top of its agenda.

Social, or, impact investing

According to a JP Morgan study, the field of social, or, impact investing – funding projects that will have positive results or outcomes for local communities or society as a whole – is valued at $3 trillion. As with investing on the stock exchange or buying stakes in unlisted companies, the field of impact investing is becoming an asset class of it own. Scott Lawson – the Founder of SOW Asia, a non-profit organisation looking at expanding the spectrum of philanthropy and funding Asian projects with highly social impacts – has said, ‘The impact investing space is new and big and is trying to resolve the current tension between profit and justice. It can be defined as visionary leadership because it is looking for alternative ways to solve critical and strategic problems.’ This was echoed by Wolfgang Hafenmayer, Managing Partner of the Venture Philanthropy arm of private bank LGT: ‘Every industry has “impact” potential. Social entrepreneurship and corporation can cross-fertilise and there is an important leadership role in there.’

This field is growing fast in Europe, Asia and Latin America. International organisations such the World Entrepreneurship Forum and the European and Asian Venture Philanthropy Associations are gaining momentum. Each in their different ways is assessing how to impact the poorest people on the planet by promoting social entrepreneurship. Together, they aim to define new models of investment to support growth, harmonise the definition of impact investing across the board and create adequate metrics for it. This trend is also spreading to wealth-management activities

Responsible leadership

Companies such as Leaders’ Quest are emerging. They aim to create a global community of leaders aware of their impact on the world.

There is an urgent need to bridge sectors, nations, cultures and different outlooks. To do this, there is a requirement to foster and nurture leaders able to stand in the shoes of others so as to ensure that a wiser decision making process becomes the norm. Leaders’ Quest pushes leaders to get in touch with their humanity and ask themselves, ‘How can I contribute, how can I make a difference to myself, to my organisation, my community and the wider world?’

There is an emerging call for corporations to rediscover themselves, a re-affirmation that their primary role is to create value while serving a community. To discharge this responsibility, they need to be fully aware of their impact on the world at a macro and micro levels.

Future successful leaders cannot afford to overlook this and the above dimensions or fail to integrate them into their practice.

Boundaryless technology

The picture of Facebook traffic on the African continent¹ (shown in Figure 2.1) highlights just how well-connected our world now is.

Everyone is part of a community and expresses opinions about everything and everyone. There are fewer and fewer boundaries between our work and private lives – new types of applications enable us to keep in touch with office contacts and personal ones while at work or play. This creates a new set of issues when it comes to people management and style of leadership. What is appropriate, in terms of time spent and use of these tools? Should we allow and encourage their use or control and suppress them? How does all this connectivity impact company policies? How can you use these tools in your leadership? These are important questions for future leaders.

New ways of working are also emerging that are highly mobile and flexible. They frame an increasing need to balance flexibility and productivity and call for a transformation of the notion of office space. Trust and accountability now lie at the heart of the working relationship, as does the work–life balance. In today’s world everyone is expected to be accessible at all times to everyone else and this is challenging the notion of the possibility of real time off. New leaders need to adjust their perspectives and examine their sense of what is important and urgent as well as balance purpose with process.

Knowledge has also become readily available, spreading virally. The notion of competitive advantage is experiencing a fast-decreasing life-span. Leaders need to constantly look for and harness mega trends in order to build a sustainable future.

These are real changes that are impacting every organisation and cannot be ignored if organisations expect to survive. Leaders of the future ought to be aware of and address such issues as they will be called on to decide and strategise, harness or react to what the world throws at them.

Leaders now need to have an understanding of the risks and rewards of a well thought out social media strategy and use these media as marketing or even strategic tools. There is also an imperative to think about ways to use flexible working options to retain an increasingly volatile workforce in a world where talent is diminishing. Finally, there is a need to shift from thinking in terms of competition to thinking in terms of collaboration.

Diverse and increasingly complex mega trends

Complexity and diversity are touching every dimension that goes to create our modern world – economics, culture, gender and demographics.

At an economic level, different forces are competing. The emergence of the BRIC countries as the engines of global growth (as shown in Figure 2.2) is accelerating the need for cultural awareness.

Business growth and sustainability require an understanding of the driving forces of diverse economies, with every organisation and every leader needing to be looking East and West. Rather than being focused on one geographical or regional entity, leaders need to be looking at very specific issues and opportunities. How can doing business in a country like Singapore – a services and trading pole and wealthy and politically stable state – compare with setting up business in agricultural and tourism-dependent Vietnam or unstable and corruption-ridden Indonesia? How could, for example, the South African economic model be applied to the reality of Uganda or an oil-rich Nigeria?

At a cultural level, it is more and more important to have a deep understanding of a country’s psyche. So, it is necessary to fully comprehend the colonial and tribal heritage of all the main countries in Africa to have any chance of tapping into opportunities of this next big emerging market. Equally, understanding the subtle hierarchy and sense of duty in Chinese or Japanese cultures leads to better negotiations. The Western European and/or North American models are becoming increasingly challenged, both as economic and as leadership models.

Source: Figures as at November, 2012 - PwC Projections

At a gender level, there is increasing recognition that women are a growing economic force. According to the article ‘The female economy’,² globally, women control about $20 trillion in annual consumer spending, which could reach $30 trillion in the next five years. Women represent, in aggregate, a growth market twice as big as China and India combined.

It is also recognised that women are adding tremendous value to the business environment and via their roles on the Board of corporations. They tend to provide a focus on risk and controls and present highly developed emotional intelligence. ‘Companies with the highest number of executive women had a 35% higher return on equity and 34% higher return to shareholders compared to those with few women at the top’, states the diversity thinktank Catalyst.³

Understanding women as a market is increasingly a must for companies if they are to retain or build competitive advantage. At a deeper level, nurturing, fostering and developing women’s talent is a critical mission for new leaders. Also leaders must set the tone for organisations to drive and embrace more diversity generally, as well as comply with regulatory pressure to ensure the equal representation of women on the Boards of companies.

At a demographic level, by 2015, about 50 per cent of the global workforce will be composed of people born between 1977 and 1997. Four different demographic trends will soon coexist in the workforce. They will present totally new and radically different drivers – a result of the technology revolution experienced in the past 20 years that is still ongoing. This is demonstrated in the list of the main demographic trends of the past 80 years⁴ below.

Baby Boomer I – born between 1946 and 1953
Memorable events
Assassinations of JFK and Martin Luther King, political unrest, independence in Africa, a man on the moon, Vietnam War, anti-war protests, student protests, social experimentation, sexual freedom, civil rights movement in the USA, environmental movement, women’s movement, protests and riots, experimentation with various intoxicating recreational substances.

Key characteristics
Experimental, individualistic, free-spirited, social causes orientated.

Baby Boomer II, ‘Generation Jones’ – born between 1954 and 1965
Memorable events
Watergate, Nixon’s resignation, the Cold War, the oil embargo, raging inflation, disco, oil shortages.

Key characteristics
Less optimistic than Baby Boomer I, pragmatic, cynical.

Generation X – born between 1965 and 1980
Memorable events
Challenger explosion, Iran–Contra, Reaganomics, AIDS, Star Wars, MTV, the home computer, safe sex, divorce, single-parent families, end of Cold War, fall of Berlin Wall, Desert Storm.

Key characteristics
Searching for emotional security, independent, informal, entrepreneurial.

Generation Y – born between 1981 and 1999
Memorable events
Rise of the Internet, September 11 attacks, cultural diversity, two wars in the Middle East.

Key characteristics
Accepting of change, technically savvy, environmentally aware.

One additional force at play is the Baby Boomers’ tendency to exit the market in droves while still at the top of their intellectual abilities. This represents a wild card in the current tough dynamics of the talent market. As they opt for second careers as entrepreneurs, they may begin to present attractive employment propositions for volatile and purpose-driven Generation Ys.

As a leader, how could you build a human resource strategy to attract, retain and foster young talent? As a leader how could you reconcile and motivate such a disparate workforce?

‘I dream of having a company with people who think like me, where we would all collaborate to innovate and create value, using technology. Leadership in the future is not only about someone who inspires, it’s about someone who enables you with technology, who is accessible, open to difference and who will tell you the truth about the company. As Gen Y, we have a hard time making decisions, we are option people and like to challenge. I think we have a hard time accepting leadership, but at the same time we do not know how to be leaders. The leader of the future is just like an app – one that gives you the truth, makes decisions and cherishes speed over process.’

Interview with Ruth Marshall-Johnson, WGS

As a future leader you need to be able to make everyone come together around a vision and goals in a way that is equally appealing to all of them. You also need to address the looming knowledge gap that the existing mature and long-lasting workforce will soon leave in its wake.

Codes are changing fast and there is considerable volatility – uncertainty, complexity and ambiguity are the new attributes of the current world. Only someone well aware of this can dream of becoming a future model of leadership.

New conundrums … new leaders

To cope with a world filled with new paradigms, any aspiring leader needs to integrate a very specific set of attributes, while demonstrating new types of values. To cope with dilemmas and solve problems, new leaders must look to develop a new sense of collaboration. To match the increasingly global and complex environment, future leaders need to feel at ease with innovation and apprehend the world in a diverse and ever-evolving way. They also need to accept and trigger positive conflicts.

The underpinning value required is that of accepting, embracing and promoting diversity, with inclusiveness becoming the differentiating factor with new leaders.

As renowned business psychologist Douglas LaBier said in an interview for the Washington Post in November 2008, ‘If Google were a person, it displays, in many respects, the model of a psychologically healthy adult in today’s world. Its corporate culture and management practices depend upon qualities like transparency, flexibility and collaboration with diverse people; non-defensiveness, informality, a creative mindset and nimbleness, all aimed at aggressively competing for clear goals within a constantly evolving environment.’

This elegantly summarises what leaders of tomorrow should aim to be and strive to do.

The new meaning of collaboration

The increasingly complex environment today is challenging the traditional problem solving and analytical skill sets of today’s leaders.

As Bob Johansen states in his book Leaders Make the Future (Berrett-Koehler, 2012), ‘In years ahead there will be fewer problems that can be solved. Instead we will have dilemmas that are basically insoluble problems.’ Such dilemmas require a radically different approach, collaboration becoming critical to finding the best possible solution.

According to Ernst and Young’s Economist Intelligence Unit,⁵ the collaborative leadership of the future will embrace all of the following means of achieving solutions:

• Purposefully bring together people from different backgrounds Diversity appears to be the ultimate driver of value creation, as indicated by 53 per cent of the 1050 leaders working in global companies. For about 560 of these leaders, there was a strong correlation between reputation, financial performance and diversity. Championing diversity is part of the leadership package of the future and this includes spotting conscious and unconscious bias and breaking conformity patterns. ‘However, as diversity is messy, hence difficult to embrace, let alone to manage and requires a supreme level of self-awareness and ability to sense your environment’, cautioned Clara Gaymard, Vice President of General Electric International and France country chair in an interview, empathy and emotional intelligence will be key.
• Become idea catalysts Leaders of tomorrow will need to be idea catalysts. Discussion and debate are necessary for the emergence of new ideas. There will be requirements to subtly stir the debate in a non-threatening way while consciously pushing for divergence. This will only enhance the chance for innovation to occur or make it stronger.
• Being at ease with conflict Future leadership roles will require the ability to spark healthy tension. Leaders will constantly have to move teams and organisations out of their comfort zones and fight complacency, which could give rise to conflict. The ability to survive in an increasingly agile environment depends on it. As iconic leader Jack Welch might say, the forces will have to be constantly kept alert and moving.

This new collaborative leadership style will have to come from a deep appreciation of the value of individuals, combined with a willingness to put them constantly to the test. It will need to be able to match up to the increasingly uncertain nature of the business world and of the world at large.

Balancing innovative thinking with global realities

Above and beyond collaboration, future leaders will have to be able to grasp the global picture and/or create their own solutions.

So, how will innovative leaders be defined in the new paradigm?:

• They will have confidence in their own abilities Such leaders will have confronted and conquered their fears of failure and be willing to challenge the status quo, ready to do things differently, not abide by any one model.

• They will factor in time to pause and think In today’s hyper-fast, hyper-connected, hyper-here-and-now environment, leaders need to be able to go into standby mode and observe the team, the organisation and the world. The new leaders will be disciplined enough to be able to block out the outside world and be in the moment. This, in fact, is the critical competitive advantage of the innovative leaders. Of course, leadership is all about action and delivery, but the upstream time spent in allowing ideas to incubate is critical to innovation.
• They will be the ultimate change agents, able to embrace it and create positive change every day and at every level This ability allows the organisation not only to stay current but also get ahead. So ‘innovative’ takes on a broader meaning – of innovation in every way, from product strategy, to marketing, to business model creation or process re-engineering – anything that allows something new to come to light – to ultimately have an impact within or outside of the organisation – is a sign of an innovative leader.
• They will not only trigger change but also be able to manage it Simply finding the world’s or the organisation’s pain points and creating a vision is not enough for innovative leaders. They also have a supreme ability to unite around change and communicate. Can you reassure others when they are faced with the unknown, the different, the new? Can you influence and convince others to commit to embracing change? This is the acid test of a true leader.
• Above all they will have the ability to think globally Muhtar Kent, Chairman and CEO of the Coca-Cola Company, put it well in an interview for Ernst and Young’s 2010 ‘Globalization Report’. ‘Leading is a global mindset. It is about putting all actions and decisions through a global filter. For instance, how does a decision made for a business in the US impact our business in India? How will this innovation in Poland translate in North America’s market? What can we learn from our experiences in Mexico that can apply to China?’ How can we explain what global thinking really means when applied to business problems? The aptitude to develop a locally fit-for-purpose ecosystem that also allows for the delivery of a global objective is perhaps best described using the following equation:
  

  Unique global selling + Local business and/or Local delivery models

  = Global thinking

  
  Another way to describe global thinking is as the ability to integrate all cultural dimensions when developing new business solutions – that is politics, consumer behaviours, infrastructure availability, history and people’s psyches. It is strongly related to spotting tension points and creating solutions that are locally fit for purpose and being able to deliver the global vision, which is also known as integrated strategic thinking. For example, if you were to realise that the infrastructure for consumer food was weak in African countries and local behaviours were to buy from small, local, independent shops, you would not provide cans but small glass bottles of fizzy drinks, as is the case in Tunisia.

Without doubt, there are other attributes that define innovative and globally aware leaders (those relating to technologically savvy social media experts, for instance). However, being fearless, willing to put time aside to think and being a change agent appear to be the key foundations on which tomorrow’s leadership will be built.

The power of ‘inclusiveness’

As mentioned above, integrating diverse and global market dimensions, above and beyond our own limited cultural context, is critical to the successful business.

Human beings make decisions based on heuristics. Their judgement is founded on simple and efficient rules, hardwired during the evolutionary process. These rules provide a shorthand for categorising people and behaviour. Moreover, whatever is familiar to an individual, whatever is aligned with their own patterns, their own culture, or those that seem similar to them, will always appear more appealing and acceptable. Consequently, the last must-have skill for the leaders of tomorrow is inclusiveness.

Inclusiveness is the willingness to break out of your own patterns, a desire to get out of an emotional or personal comfort zone and not only embrace difference but also learn how to value it. It is the talent not only to understand but also to manage different ecosystems.

Inclusive leaders multiply professional experience outside their comfort zones, working in places or areas of a business they have never experienced before, with people they do not know and in markets they have never visited before. They also care for the people around them and show genuine interest and true respect.

In fact, inclusiveness can be associated with the concept of servant leadership, as developed by Robert Greenleaf, since inclusive leaders have at heart a commitment to the well-being of their people and their community. They place their main focus on people and how to promote their personal development. Inclusive leaders have the aptitude to create highly diverse teams while creating a safe space for co-creation. All viewpoints can be expressed, truly heard and debated.

Finally, inclusiveness can also be seen as the power to manage both conflicts and consensus.

Summary

New conundrums call for new leaders – more self-aware and more emotionally intelligent than ever before, innovative and inclusive. The following, then, may be added to the list of desirable leadership attributes and actions to take to become a leader of tomorrow:

• self-awareness courage, integrity, fearlessness, being culturally savvy, a thinker
• understanding others and having influence inclusive, collaborative
• vision and execution think globally, act locally, be truly innovative, a change agent, reconcile profit and fairness, have an impact.

Here’s a reminder of some of the key points from this chapter:

• the world is undergoing a massive transformation, changing codes, values and purpose and embracing technology, to become an increasingly connected and complicated world
• The best leadership models are deeply rooted in the reality of the world around them, so aspiring leaders too need to always be in tune with the needs of their environment. It requires them to be in tune with current values, retain flexibility and enhance their strategic thinking.
• aspiring leaders need to demonstrate that they are collaborative and innovative in their thinking and actions
• they must embrace diversity, champion inclusiveness and multiply experiences, sharing these with others
• these attributes need to be integrated into the three cornerstones model which involves looking inside yourself (self-awareness), looking around you (understanding) and setting things in motion (vision and execution).

¹ Ictworks.org, ‘Facebook usage in Africa is doubling every 7 months’, Facebook, Inc.

² Michael J. Siverstein and Kate Sayre (2009), Harvard Business Review, 1 September.

³ Rachel Soares, Christopher Marquis and Matthew Lee (2011) ‘Gender and corporate social responsibility: It’s a matter of sustainability’, Catalyst and Harvard Business School, November.

⁴ H. Schuman and J. Scott (1989) ‘Generations and collective memories’, American Sociological Review, 54: 359–81.

⁵ ‘Winning in a polycentric world’, Ernst and Young, 21st Century Workforce series, Economist Intelligence Unit, January 2011.