Saturday, June 5, 2010

Leadership in a (permanent) crisis - A HBR article Review

A review of HBR-SA, JULY-AUGUST 2009 article ‘Leadership in a (Permanent) crisis’

As a regular HBR reader, I was in a way rather let down by the article which seems to lack the charisma of regular HBRs. On the whole, the whole write-up seems to revolve around application of Kaizen and Emotional Intelligence. As the saying goes, ‘The crisis of today is a joke of tomorrow’.


The author talks about exhibition of leadership qualities fostering adaptation, embracing disequilibrium and one that generates distributed leadership. There are a lot of companies in the world which went up and down with the bubble burst phenomenon of the internet age. The reason for these companies being unable to sustain their growth was their inability to maintain business growth when the regular/conventional source of income for them dried out or started diminishing. Thus began an era of mergers and acquisitions which yet again paved way for larger organizations retaining the major chunk of the markets. The rich became richer and new millionaires were thus born in the process.

Foremost, for any business to survive in the long run, the business process must be able to adapt itself to changes on small and large scale. This may be also compared with the Darwinian theory of Evolution which says that the fittest survive. To remain fittest, one must adapt and recalibrate at regular intervals of time. If we take the examples of dinosaurs, the only dinosaur that still exists is the crocodile. This was possible by the ability of crocodile to adapt to live on land as well as under water.

Secondly, the idea of embracing disequilibrium seems to be a shlep. In a state of disequilibrium, the emotions are already at a heightened state. Any further disequilibrium would certainly result in the employees being shattered to an extent that their morale goes down. This as such impacts the productivity and not facilitating the process of making difficult decisions by the employees. The author also talks about maintaining an optimum level of disequilibrium to continue the progress. To me, this seemed like stretching a rubber-band and holding it there to be used as a slingshot. As time passes, the rubber-band tends to wear out and breaks at one point of time or loses its elasticity. Humans are so much like rubber-bands; they cannot be stretched for a long period of time. If done so, they tend to break down or there is a noted drop in the performance.

However, I totally support the author with reference to creation of distributed leadership. In an era when everybody pitches in to provide solutions rather than answers, it is rather imperative that the decision making has to happen at grass root levels and the leadership has to be distributed. Everybody loves being a part of the solution rather than the problem. So, as the author rightly points out, it is necessary that opportunities are created and thus create avenues to come out successfully from the crisis. However, my concern on this arises from the saying ‘Too many cooks spoil the broth’. What is needed in distributed leadership is co-operation and a determined effort to achieve the goals rather than negating each other out.

A crisis, as a wishful thinker would consider that the Chinese equivalent of the word ‘crisis’ consists of two parts representing opportunity and danger, is a mere turning point at which the fall or raise of any company is decided. Once a gale storm passes, it brings with it change that takes a long time to be negated and overcome. The surface is so rough that the prior composition of the land might not exist after such an event. To make the surface usable, any prior experience not involving the gale might not be of much use anyway. Similar is the case with any organization. The past experience not involving such an experience holds little or no significance as per my point of view. So, to restrict the decisions on past experiences would be rather blasphemous. What is required in such a scenario is the ability to adapt and grow with the scenario in hand to survive the crisis and grow once the crisis has been overcome. At the end of this crisis, the company has skills to manage such a situation in the future if faced with such.

The author provides us a case study of Best Buy where a person’s leadership wits are able to transform the company from being gender specific to being the best in business. For me, that is rather an insight than creative leadership. When a person learns to see what is stopping the business from growing, the solution is rather simple: Find a way to negate the issue. As the saying goes, ‘Hurdles are those scary things you see when you take your eyes off the target’. In this example of Best Buy it was more of a focus on the target than creative ways of solving the problem. Or in other words, it is rather an adaptive measure which helps the business grow. Had the business looked at small time fixes to just get over the crisis, it would have proved fatal in the long run. A business fix is like fixing the flat tire of a car; if not done properly, there are good chances that the car will run flat soon. However, too many fixes will make the ride bumpy. In such a situation, what one needs is replacement of the tire or what the author calls to be ‘Pressing the Reset Button’.

Sometimes it is better to start things afresh rather than providing fixes. In such a situation, what a business needs to do is look at its past and try not to repeat its mistakes the second time around. When the business starts afresh, there are a lot of possibilities that the business might go through a lot of dire straits initially. Sometimes even be tested up to the breakdown. In such situations, adapting to the situation does help one and all. Rather than sitting and cribbing about the problems, collective intelligence must be used to solve the problems with intelligent solutions.

Finally, I agree with the author when pointing towards adaptive leadership in general. It is adaptation that makes cacti grow in sahara where other creatures barely exist. Each day brings new opportunities to grow and branch out. All that is needed is perseverance and the grit to grow stronger and better with every opportunity provided. Adaptive leadership is the way the future is going to be.
Review by,
Bharath S Iyer
http://themoonfruit.blogspot.com

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