In our troubled times, many business leaders and managers discovered they had to offer better quality offerings at a lower cost while adapting their business models to market trends and rapid change of their ecosystem. In this context, leadership has become even more strategic than ever before.
First, many research have been published on the topic and tend to identify effective leadership as one of most essential elements for a company to maintain its growth (Cabeza-Erikson, Edwards, and Van Brabant, 2008). According to theories, leaders are the ones who control and take charge of the operation of an organisation, and good leaders have the ability to set optimistic goals and targets while steering the operations through effective strategies. In many examples, smart leaders also have the responsibility to use their skills and knowledge to guide their business forward effectively and efficiently to decrease the feelings of insecurity in their employees caused by external and economic factors.
A characteristic of effective leaders is that they give a clear vision to employees and help them commit to their tasks to achieve the organisation’s goals and objectives (Wasim, and Imran, 2010). This idea is also vivid in the concept of Liberated Company, described as an organisation in which employees have the freedom and responsibility to take the actions, as long as their decisions are made in the best interest of the company (Getz, 2009). This also tells us that good leaders had usually previously defined a clear vision for the organisation and therefore can easily identify the issues and obstacles faced by their teams.
From managers to change advocates
Then, it seems essential to clarify two different concepts: leadership and management. Management could be seen as the traditional way of managing organisations, in which the owner of the business has complete control of the firm and will single-handedly establish a direction and guide their employees to do their work in accordance with the instruction and plan.
On the other hand, leadership could be analysed as a more subtle and balanced way of leading people. It is defined as the ability to influence a group of people values, beliefs, attitudes, and behaviour. (Ganta, and Manukonda, 2014). Leaders guide their colleagues towards the corporate goals, all the while trying to communicate and motivate them to ensure they are in the right position to use their talents and commit to their roles. Leadership strategies evolve and change according to social, psychological, or moral trends, while management merely follows traditional and well-defined rules (Graetz et al., 2010).
Even though change has always been an issue for organisations, the current social, geopolitical, and economical contexts make it even harder to accept and implement. Indeed, change is something that pulls people out of their comfort zones, which forces them to change their habits and makes them highly uncomfortable (Lorenzoni, Nicholson, and Whitmarsh, 2007).
But by looking at the bright side, it is also commonly accepted that crises are the best moments to identify issues and things to improve. Therefore, by catching opportunities and transforming it into competitive advantages, organisations can effectively and efficiently implement and adapt to the change of the market (Du Plessis, 2007).
According to Atkinson, if there is no effective leadership in an organisation, no changes will be made. This is explained by the lack of leaders that motivate and lead the employees, but also by the absence of clear guidance for the organisation (Atkinson, 2015). This principle could also be applied to trust in difficult times, which is an essential element to maintain and even improve performance and commitment in a group (Lee et al., 2010). Indeed, if the employees trust their leaders, this relationship will bind them together and improve the overall satisfaction and, consequently, their results; if it happens conversely, the performance and commitment of the employees will go downhill and could cause internal issues such as misunderstandings and conflicts, adding up to an already challenging external environment.
Innovation as a success factor
Moreover, leaders and organisations facing difficulties need to encourage employees to be innovative and cooperative. Therefore, teamwork and effective communication are the best way to create innovative ideas to produce the best outcome for the organisation (Maxwell, 2009). To achieve the kind of teamwork and rapport that is necessary for the birth of innovative ideas, leaders need to cultivate a positive culture where the employees trust each other, are allowed to do their own jobs without too much interference and have the freedom to establish a dialogue with one another (Malloch and Melnyk, 2013). These theories are particularly encouraged in liberated companies as it is expected from the employees to take initiatives, manage projects, and make decisions on the daily basis. Therefore, leaders that wish to facilitate effective change in the organisation should encourage employees to collaborate and communicate with each other, for this is how people are able to create and discover new ways to think (Gilley, Dixon, and Gilley, 2008), which produces a greater outcome for the organisation and encourages them to learn from different people the ways to improve themselves.
Besides that, the current geopolitical, economic, and business environment requires an organisation to make changes to keep up with the rapid evolution in the ecosystem. If the organisation fails to make changes and adapt to the market, they will face major risks of failure and bankruptcy. During the upcoming recession period, exactly like during Covid19, leaders will be in charge of providing a clear vision and a systematic way to effectively achieve that vision (Atkinson, 2015).
However, although leadership can bring lots of positive changes and increase the organisation’s performance, other factors might affect the possibility of the changes to occur. Indeed, every employees’ behaviour and attitude are different; some employees might be able to easily adapt to change but some will resist and even fight it. Some might accept the ways of their team and learn from the action of their leaders, but some will become paralyzed and will refuse to cooperate. This would drag the performance of the organisation down. To make sure these challenges do not affect their business, organisations will need to rely on their leaders, whatever their title is, to align visions and manage changes. Of course, in a period of looming recession, leadership will not be the only solution and issues will still have to be faced. Nonetheless, companies that are able to rapidly update their processes and business models will be better prepared to face uncertainties.
"To improve is to change; to be perfect is to change often." Winston Churchill
As usual, change is hard for people, people will feel uncomfortable because of it and even sometimes deny it. By focusing on their ability to guide teams, gain the trust of their colleagues, and maintain a high level of commitment, leaders will facilitate the operations of their organisations. This could also make other parts of business management easier, such as shaping the culture in the organisation. Indeed, a good culture in the organisation not only provides a good working environment for employees, but also gives them a sense of belonging and increases their commitment to continue working in the organisation. Also, innovative ideas will be produced when leadership motivates the employees to communicate with each other and share their thoughts with each other.
As a conclusion, leadership skills enable people to lead their colleagues into the correct direction, in accordance with the organisation’s vision and mission. It is especially during difficult times that the ability of a leader to guide the employees on the right way and motivate them to continuously improve and innovate is most needed. Successfully achieving this will lead to an increase of performance and strengthening of the organisation in the current complex business environment (Atkinson, 2015). Napoleon Bonaparte once said: “a leader is a dealer of hope”. In a VUCA world, this quote is particularly true and illustrates to what extent natural leaders are important in today’s organisations.
The ones who will have the ability to think forward, look at the big picture and keep in mind the long-term goals will allow their colleagues to go through crises and reinforce their company. To do so, they will need to understand the importance of focus and simplicity in their tasks and priorities. By following their path step by step and engaging their teams, they will plant seeds that will flourish after the storm.
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