The rules of business 50 years ago (even 20 years ago) were very different from the rules today. As a business leader, if you don’t take care to know what these rules are, and have a plan in place to address and embrace them, yours won’t be a brand of the future.
A new way of doing business
While the term was almost unheard of a few decades ago, today ‘sustainability’ is the pinnacle of leadership. The result is that leaders need to consider the impact of their actions on the business world, governments, as well as people and the planet.
This requires a paradigm shift, but it’s associated with numerous paradoxes and complexities. In an attempt to manage and understand these paradoxes, we look at three qualities of a sustainable leader and illustrate these with examples of real CEOs.
1. Financial growth is not a primary driver for organisational success
Previously, growth was the single most important driver of organisational strategies. Today, leaders are confronted with the paradox: Is growth feasible in a world running out of resources? Do we need to grow at all costs? How do we marry growth and sustainability? What is the risk and result of a growth-focused strategy?
Leaders can no longer base decisions purely on financial growth or be incentivised based only on financial performance.
Sanlam CEO Johan van Zyl has expressed his concern for South Africa’s short-term profit objectives and the use of incentives to support an immediate vision for shareholder wealth creation and growth. Sustainable leadership underpins the belief that this approach will undermine an organisation’s ability to grow economically and create an equitable, sustainable future for its entire stakeholder base.
2. Innovation is a tool to drive impactful organisational change
Incremental changes will not make organisations truly sustainable. In the past, most organisations focused sustainability efforts on cost efficiencies (by reducing consumption of resources) and compliance (by reducing risks and protecting their social licence to operate). Although small, these are steps in the right direction.
However, in the quest to become more sustainable, organisations cannot innovate just for the sake of innovation. Innovation requires positive changes to products and services, and eventually the business model. Only in this way can innovation lead to transformation and sustainability.
In 2011, bottled water manufacturer Valpré, owned by Coca-Cola, opened a state-of-the-art manufacturing facility in Heidelberg. Every detailed component of the plant underpins innovations to reduce Valpré’s carbon footprint and supports a business model geared towards sustainability.
The plant is the first in South Africa to produce PlantBottle packaging – a 100% recyclable bottle design comprising 30% plant material. In the US, the production of 2,5 billion PlantBottle packages eliminated the equivalent of approximately 60 000 barrels of oil from Valpré’s plastic bottles. This innovation may have been small, but its cost and environmental impact was transformational.
Perhaps the most visible example of an entrepreneurial trailblazer is Sir Richard Branson who predicts that the business world will enter unknown territory in ten years — running out of energy, yet remaining worryingly over-dependent on oil.
He views the opportunities of renewable energy as the perfect platform to develop new technologies and innovations for business success, marrying innovation with
impactful and sustainable change.
Leaders need to ask themselves whether their organisations have the resources, skills and internal capacity to drive innovation to become more sustainable in the future. If organisations cannot develop truly innovative business models, their ability to create long-term value may suffer and their economic survival will be at stake.
3. Value collaborative, altruistic capitalism
Business is inherently competitive. However, a stakeholder-based future may ask leaders to be more collaborative. The long process of stakeholder engagement will ensure that the organisation has the long-term stamp of approval of its stakeholders to continue to do business.
Leadership for sustainability requires a heart, rather than a head approach. An overriding traditional leadership quality was the ability to cut through emotional clutter and make decisions based on facts. In a sustainability context, predictability is hard to come by.
‘Emotional clutter’ – impoverished communities, contaminated water and endangered species – is part and parcel of what sustainability demands. Leaders cannot afford to ignore these elements.
Today, leaders have to base decisions on uncertain futures, unpredictable outcomes, deteriorating resources and incomplete analyses. This will often require intuitive or ‘heart-led’ leadership – an approach that may not come naturally to most 21st century leaders.
Unilever’s CEO, Paul Polman says one of the greatest challenges of this century is to provide good standards of living for seven billion people without depleting the earth’s resources or running up massive public debt.
He begs for a new form of capitalism, and the pledge by businesses to partner with government to collectively address socio-economic and environmental concerns. Business is part of society, not separate from it, and needs to recognise that communities carry the same weight as the demands of shareholders.
A new generation of leadership
Growth in difficult times, constant innovation to stay ahead of competitors, innovative products and services, and embracing change in an increasingly complex environment will remain imperatives for business. Simultaneously though, leaders will have to embrace the underlying paradoxes in these imperatives.
The sustainable leader will fearlessly face these challenges and establish a new generation of business leadership.
Why Elon Musk’s Vision Should Change Your Business
If you’re not moving forward, you’re moving backward, there’s no sitting on the fence, its one or the other.
It’s about the big picture
Elon Musk is the kind of guy who probably divides the room wherever he goes; in the same way that people either prefer Superman or Batman, soccer or rugby, maybe summer or winter. There’s no sitting on the fence. It’s one or the other. You either like Elon Musk or you don’t. But this article is not about him, its about you and how you are leading your business.
Love him or hate him, I don’t believe any business leader can get away from the fact that Elon Musk, possibly more than any other contemporary entrepreneur, is going to have an influence over your business. And if he doesn’t, he should, not as an individual as much as an archetype.
In the early 2000s another famous South African born entrepreneur Mark Shuttleworth was the first South African to become a space tourist. We were all proud, and asked ourselves what we would do if we had billions of Rands… how would you spend it? Mark’s rigorous preparation and orbit in space riveted the nation, from coffee break conversations to television documentaries and Grade 5 school projects. Everyone was talking about it. Mark’s trip was ultimately the fulfilment of one man’s personal ambition, a dream long-held and finally fulfilled.
Aligning the planets
Elon Musk seems to be a different kind of dreamer. He does not only dream for himself, he dreams for humanity and that is rare. It is also why I think that his vision is something that every business leader should take note of. Look at any Start-up:101 Pitch Deck and you’ll likely see Guy Kawasaki’s famous 10, 20, 30 format and the first slide trying to answer the question, “What problem are you solving?”
Imagine setting yourself the problem of transitioning humanity into becoming a “multi-planetary species”, as Musk famously declared in a 2017 TED interview, and if that’s not enough, you are also working to revolutionise transport and save the environment through clean energy. In my view, Elon Musk (flawed as he may be) represents, two essential qualities that are absolutely indispensable for leaders and businesses of the future: Hope and Vision.
The lever that Musk has chosen to crank open the future, restore hope and unlock his vision, is technology. Misunderstood and much maligned, technology; like Musk, also instantly divides a room.
Technophiles on the one side, technophobes on the other and you must choose. You cannot half use technology, you either opt in or you opt out. The only choice is whether you will use technology responsibly or not. This is no small question and something that many business leaders (including Musk) have shown some commitment to by adding their support to organisations such as the Future of Life Institute.
Ships are not built to stay in the harbour
Technology is agnostic, it is neither good or bad. It’s influence lies in how you choose to use it. With so much talk about the Fourth Industrial Revolution (4IR), and how it is going to impact our lives and, in a business context, the lives of our employees it seems prudent that, as leaders, we establish a clear vision for technology in our businesses with due cognisance of how it is likely to impact our staff and our customers alike.
A business that integrates machine learning and AI into its business management system, for example, may in future have unprecedented access to information, provide intuitive robotic support 24/7, and the power to influence behaviour. This goes beyond ‘old-school’ marketing and advertising, heading into untested waters.
While we should rightly rely on our policy makers and legislators to put regulatory frameworks in place to guide how we use technology, as business leaders we should already be taking the first steps towards developing a technology-use policy in our businesses.
Like Musk, our aim should be to bring hope and share a vision. A hope that, even with the threat of diminishing resources in our businesses, we are up to the task of conceiving novel and exciting alternatives that, even if it looks different than in the past, are able to meet the needs of our people. And a vision, not just to increase shareholder value or to be the leaders in our field, but something aspirational.
A commitment to lift eyes and hearts with a big vision, maybe not for interplanetary travel, but at least to let your Enterprise boldly go where it has not gone before, not as a tourist, but as the captain of your ship. Because if you’re not moving forward, you’re moving backward, there’s no sitting on the fence, its one or the other.
6 Ways To Lead In The Multi-leader Economy
Why business leaders today compete for mindshare among their employees, and how they can lead.
I recently attended an event where a CEO delivered the company’s annual results and outlined its future strategy. He closed the talk with some inspirational content to get the team excited about the year ahead.
While I listened to this business leader speak, I also had my eye on the audience. While the content was relevant and inspiring, the narrative and delivery was off. This was evident in the audience, who seemed disengaged – most had their faces in their phones. These employees, who should be inspired by their leader, were simply biding their time, waiting for the next speaker.
Was it because they’re generally rude, disengaged people? Not at all. In fact, they were a phenomenally switched-on crowd when we presented to them. So why weren’t they listening intently to the proverbial captain of the ship?
Leadership competition hotting up
I believe it’s because leaders today are competing for the attention of those they lead. People are exposed to hundreds of potential leaders in their daily lives, and that number grows daily as the internet brings a whole host of outside influence into reach.
While many of these influencers are not tasked with leading, per se, great leaders seldom have to force a following. They naturally build one through an innate ability. They achieve this by delivering inspiring and engaging content on a regular basis via platforms like Facebook, Twitter, LinkedIn, YouTube, podcasts or TED.com.
And it’s not just inspirational visionaries like Jobs or Branson who people listen to today. Anyone with a strong message can self-publish to spark debate, inspire or influence.
Understand the new dynamic
Accordingly, whenever a leader steps up to deliver something relevant to their team, they need to be aware that in the past 24 hours their audience has probably watched people like Simon Sinek, Mel Robbins or Will Smith deliver a message that could spark a different way of thinking.
If you’re a business leader and have not considered the possibility that your team is also being influenced and, often, led by a host of other leaders, then you’re in for a tough time. The reality is that leaders now face fierce competition, and as the head of an organisation you need to take charge and own that space.
Here’s how you can take the lead in leadership:
1. Maintain face-to-face engagements
This is still the best way to work, especially when talking about important matters. I have a standing one-hour meeting with my team every three weeks. I open this session with a 10-15 minute talk on a specific topic I feel is important. The remaining time is used for open discussion. These sessions have been incredibly powerful, because it’s an opportunity for everyone to have their say, share their views and contribute to growing the business and the team, together.
2. Write narrative that catalyses conversation
This pertains to the content of your engagements. This needs to be something that’s not only on your agenda, but also on your employees’ agenda. People need both answers and guidance, but when leaders and teams can work on both aspects together, magic happens.
3. Deliver with conviction
Leaders often throw out a concern, hoping that it gets resolved. You can’t do that. Leaders need to stand up and deliver with passion to galvanise their teams. Sure, be part of the conversation, and ensure that your team knows how important it this, but understand that it’s more than just a conversation.
4. Get them to challenge you
The proverbial ‘open door policy’ requires employees to walk up to the door. Our regular team session offers me the opportunity to ask everyone, collectively, about their thoughts on a subject. I’m basically standing at the open door and asking them to come in, and not just randomly, but to discuss something pertinent.
5. Make the changes required
After listening to your team, take action. Due to the influence of social media, society today is plagued by “ask-holes” – people who ask for advice or ideas, but never action them. Leaders need to listen and take action. Not that you should do everything you team asks, of course, but listening is the first step to understanding, and action needs to follow.
6. Rinse, repeat
Effective leadership is not an annual speaking engagement. It requires constant work to keep teams focused on the business. The biggest failure in most businesses is a lack of communication, which is something leaders need to constantly work on.
Want To Achieve Greatness? Force Everyone Out Of Their Comfort Zones
Diverse teams are better performing teams, but only when they are inclusive.
Working in a diverse team feels uncomfortable and that’s why we perform better. Discomfort arouses our brain, which leads to better performance.
Diverse teams are smarter teams. They have higher rates of innovation, error detection and creative problem solving. In environments that possess diverse stakeholders, being able to have different perspectives in the room may even enable more alignment with varied customer needs.
Being able to think from different perspectives actually lights up areas of the brain, such as the emotional centres needed for perspective taking that would previously not be activated in similar or non-diverse groups.
In a nutshell, you use more of your brain when you encourage different perspectives by including different views in the room. However, work done at the NeuroLeadership Institute has proven that this only works when diverse teams are inclusive, and this still remains a key challenge in business today.
When we consider the amount of diversity present in the modern workplace and the addition of more diverse thinking as a result of globalisation and the use of virtual work teams, it’s clear that the ability to unlock the power of diversity is just waiting to be unleashed.
Here’s how you can unlock this powerful performance driver.
The Social Brain
Despite the rich sources of diversity present in most workplaces, companies are still often unable to leverage the different perspectives available to them in driving business goals. Recent breakthroughs in neuroscience have enabled us to understand why. The major breakthrough has centred around the basic needs of the social brain.
We have an instinctual need to continually define whether we are within an in-group or an out-group. This is an evolutionary remnant of the brain that enabled us to strive to remain within a herd or group where we had access to social support structures, food and potential mates. If we were part of the out-group it could literally have meant life or death. We are therefore hypersensitive to feelings of exclusion as it affected our survival.
The brain is further hardwired for threat and unconsciously scans our environments for threats five times a second. This means, coupled with our life or death need for group affiliation, we are hypersensitive to finding sameness and a need for in-group inclusion.
When we heard a rustle in a bush it was safer to assume that it may be a lion than a gust of wind. It is this threat detection network that has kept us alive until today. The challenge is that society has developed faster than our brains. In times of uncertainty we often jump to what is more threatening.
Some of the ways that this plays out is when we leave someone out of an email and they begin to wonder why they were left out. The problem is that it’s easy to unconsciously exclude someone if we are not actively including. The trouble occurs when we incorrectly use physical proxies to define in-group and out-group, as this is the most readily available evidence used unconsciously by the brain.
Barriers to Inclusion
A study done between a diverse group and non-diverse group demonstrates how this plays out in the work place. Both groups completed a challenging task and were asked how they felt they did as a team after the exercise.
The effectiveness of the team and how they perceived effectiveness were both measured in the study. It’s no surprise that the diverse team did better in the completion of the problem-solving task, but what is surprising is that they felt they did not do well. In contrast, the non-diverse team did worse, but felt that they had done well.
Working in a diverse team feels uncomfortable and that’s why we perform better. Discomfort arouses our brain, which leads to better performance. It feels easier to work in a team where we feel at ease in sameness, but in that environment we are more prone to groupthink and are less effective.
We can’t assume that when we place diverse teams together we will automatically reap the rewards of higher team performance. As discussed, we’re hardwired for sameness and if we’re not actively including, we may be unconsciously excluding.
If we want diversity to become a silver bullet, we need to actively make efforts to find common ground amongst disparate team members. This in turn will build team cohesion and create a sense of unity, including reminders of a shared purpose and shared goals. Many global businesses put an emphasis on a shared corporate culture that supersedes individual difference.
It’s the same mechanism that is used in science fiction films that bond individuals together against a common alien invasion. It can also be used to describe why we felt such a great sense of accomplishment during the 2010 World Cup as we banded together as a nation.
We must also make sure we uplift all team members by sharing credit widely when available and recognising performance. The last thing we can do to further inclusion is to create clarity for teams. By removing ambiguity, we allow individuals to not jump to conclusions about their membership within groups and calm their minds so they can use their mental capacity to focus on the task at hand.
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