Leading through Uncertainty (page 1 of 4)

New technologies, organisational structures, non-traditional forms of competition and economic uncertainty have added both new challenges and a greater degree of uncertainty to strategic planning and execution. Companies increasingly have to compete on the basis of knowledge - what they know, rather than what they make. In this 'knowledge economy', it is the people and the knowledge that they create that become the source of greatest competitive edge in the market place. Building and retaining the talent in which that knowledge is created is a key strategic priority for today's businesses.

Against this background, many of the traditional leadership and management methods—developed for more a stable context—often do not apply. For example, the new economic environment has challenged traditional organisational hierarchies and structures, putting greater emphasis on the need for flexibility. Tom Peters, among others, has popularised the view that "all work today is project work". Managers need to bring differing groups of people together—those with the knowledge to address a particular business issue—build relationships, establish common goals, get the work done and move on to the next issue, and the next team.

Building the capability of these 'knowledge networks' is one of the keys to achieving results. Leadership no longer equals authority. Organisations need leaders at all levels.

New Fundamentals of Leadership
In short, today's leaders are required to do more...with less. Forum's most recent research highlights three leadership practices that we believe can be helpful to leaders to manage this dilemma, no matter where they sit in the organisational hierarchy.

These are about some of the key behaviours that will help leaders steer their companies through periods of change and uncertainty, with one eye on today and one eye on the future. They are about building collaboration and commitment, creating leadership throughout the organisation and, above all, alignment with clearly laid out goals.

Think how things have changed:

The 'new fundamentals' of leadership are geared to helping leaders, at all levels of the organisation, cope with a variety of fast-moving and challenging business conditions...enabling them to lead others successfully in the achievement of stretching business goals.

Fundamental No.1 - Be Credible
In a recent survey across 187 multi-national companies, only one third of the employees interviewed expressed "high confidence" in the ability of their leaders. Why is this so important? It is because people who feel their leaders are credible are significantly more likely to feel pride in the organisation, to feel strongly connected to their team, and to be committed to the rganisation's goals and values. Furthermore, people are less likely to believe the message if they don't believe the messenger.

Those whose leaders' credibility is not strong may comply with directives but will be less motivated. In a business environment where so much is changing so quickly, this extra measure of commitment can make the critical difference in a company's performance. Indeed, Watson Wyatt reported that companies with "high trust and confidence in senior leadership" generate up to 40% higher return to shareholders than those with low trust and confidence. Four building blocks of credibility are important for building momentum, and moving forward.

1. Consistency
A leader's words and actions must be aligned.