Leadership Under Fire: How Leaders Navigate VUCA Conditions and Business Uncertainty
Dr. Anirudh Agrawal
Professor
“The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.”
Martin Luther King
Military leaders like George S. Patton, Sam Manekshaw or corporate leaders like Steve Jobs, Elon Musk or Ratan Tata and political leaders like Pandit Nehru, Sheikh Mujibur Rahman have displayed characteristics that reflect the kind of leadership that defines Leadership under Fire. Leadership under Fire most often implies leadership facing an extremely uncertain environment, high risk of failure and tremendous pressure to deliver, where the staff is vulnerable and the staff is unsure about the leadership’s abilities to deliver.
Leadership under fire is the leadership that is required to lead, make decisions and ensure the survival of organisations under extreme VUCA conditions. As a professor of Management, our greatest goal as a teacher is to transform students into leaders who have tenacity to weather extreme pressure situations, perform under VUCA conditions and deliver organisational goals with empathy and gain the confidence of staff and compatriots. While the goal is well-formulated, we as professors struggle to develop and deliver leaders who perform under such conditions. In this blog, I try to list a few characteristics that may help develop leaders who can lead under fire.
Empathy:
While empathy is discussed widely in management academia, it is seldom practised inside the classroom or in workplaces. Empathy helps leaders understand their team and their staff better. Leaders who understand the limits, capabilities and abilities of their team and staff have the foresight to manage uncertainty and get the best out of the team when under pressure. Leaders must ensure that their human management leadership maintains proper notes to map each individual’s strengths and capabilities under pressure.
Financial Prudence:
Business uncertainties can be managed through investment overdrive or through financial prudence. Financial prudence doesn’t necessarily mean to be a miser or capital accumulator; it simply means to ensure that each buck leads to corporate value creation. For example, as someone under tremendous business uncertainty, should I rent a room in a normal hotel or at a seven-star suite and ensure that each buck saved is invested into developing capabilities and resources to manage business uncertainty? Investment overdrive is another strategy to lead to uncertainty. Organisation during uncertainty increases debt and uses capital to diversify sources of income and tries to thrive on price or demand.
Reorganising Under Uncertainty:
Organisations face tremendous business uncertainty due to loss of clients, change in market, wars, change in public policies, change in politics or technology disruption. Under such conditions, leaders have to reorganise their organisation and make tough calls. Re-organising organisations may imply turning regular employees into soldiers at war. Soldiers at war are normal human beings, but fighting against an enemy that could be a business risk, uncertainty or disruption or policy changes, using meagre resources and far outside their comfort zone. Staff need to be informed, organised and primed for such situations through leadership, communication and structures that ensure their confidence in leadership. Google and Meta senior management held frequent town halls to boost morale, explicitly discussing layoffs among other strategies. Such management strategies help get more out of employees.
Decide, Implement and Learn:
Organisations invest way too much time in meetings, developing strategies and convincing too many stakeholders at the risk of making wrong or riskier decisions. We have seen that leaders who are willing to take quick decisions and implements that decision and learn from their outcomes are likely to lead better than those who spend way too much time convincing stakeholders or developing an organised strategy. We have seen larger organisations take longer decisions, steering the entire organisation towards uncertainty. Instead, organisations should form empowered entrepreneurial teams within large organisations and work like entrepreneurs beyond duty hours. These teams should focus on solutions, make decisions, implement and learn.
Value and Ethics Over Money:
Under uncertainty, human character developed around ethics, values and corporate governance makes a better leader than those who take calls purely based on monetary compulsions or shareholder compulsions. The Daimler Chrysler Merger looked fine on paper and created fairly good shareholder value, but it did not align with the core product and engineering values of Mercedes-Benz. Over a period of time, both the firms decided to part ways despite showing fairly higher financial value than they would have shown individually.
Leaders who ensure empathy for their staff, financial prudence with a focus on corporate value, reorganisation under uncertainty to manage disruption, who believe in quick decisions, implementations and learnings from those outcomes within the umbrella of strong values and ethics tend to do well and perform well when under fire.