New Business Climate Requiring New Senior Leadership Type

August 17, 2021 – Businesses across the world are now at a post-pandemic inflection point with respect to their most precious commodity: their talent. According to a new report by Alix Partners, the immediate uncertainty and chaos, underpinned by personal and societal anxiety about the impact of COVID-19, will moderate as people return to work. “But they will do so with at least one major difference: employees will have significantly higher expectations of their employer,” the report said. “Leaders that are unable to meet the needs and demands of this ‘new normal employee’ will lose the competition for talent and ultimately limit their ability to grow and prosper. This is the post-pandemic talent reckoning.”

Disruption isn’t new, but the pace at which it is forcing change is significantly accelerating, according to the Alix Partners report. “This presents a clear and, in most cases, new challenge to leadership,” the study said. “How do you mitigate the impact of multiple disruptive forces while seizing the opportunities they present? This cognitive balancing act is challenging enough for an individual, let alone someone charged with leading an organization out of months of chaos and into an uncertain, changed world.”

Confronting the Disruption Paradox

Traditionally, many have admired leaders who paint a compelling vision of the future and put in strategies to deliver it. Now, those are just table stakes. Alix Partners says that CEOs who need to transform their organizations must master a set of new capabilities that on the one hand have always been characteristic of a few rare CEOs but in the highly disrupted world of today are no longer optional. “Values-based leaders who can authentically connect with many different stakeholder groups and who intentionally and with integrity balance people with profits will be the most effective at transforming their organizations and attracting and retaining the best people,” the firm said.

Leadership Itself is Being Disrupted

The requirements of leadership in today’s world of continuous disruption demand a complex combination of capabilities and skills. “In many respects these are skills that are hard to calibrate, tricky to nurture and have seldom been widely appreciated,” the Alix report said. “They are the epitome of the ‘je ne sais quoi’ of leadership. The disruption balancing act is but the tip of the iceberg. Political polarization and the resultant unsettling and uncertainty have put business leaders at the very center of their people’s lives.”

It is no surprise that, according to Edelman’s Trust Barometer, a person’s employer is now the most trusted institution in their life. The responsibility this places on the transformative leader is colossal. Not only must they provide a sense of security, but they have also become the modern ‘tribal leader/elder’ – personifying values and culture, and serving as role-model for both. While actively avoiding controversial topics for decades, CEOs and executive leaders are now expected to formulate and articulate their organization’s position on political and social issues. In many cases these are visceral and emotive topics, the likes of which businesses have typically approached with a ‘discretion is the better part of valor’ mindset. Taking an active stand is a non-negotiable for CEOs among their Millennial and Generation Z employees; failure to do so is no longer accepted.

The Generation Game

The other critical challenge facing leaders, particularly as we emerge from the pandemic, is the need to manage intergenerationally. It’s easy to generalize about generations. By and large, there are arguably more similarities than differences but there are nuances. Leaders need to appeal to each group according to their expectations. It’s true servant leadership, complicated by the need to be at the forefront of change in an organization. For many leaders this is a significant test of their talent – another reckoning, if you will.

The Four Principles

This new form of leadership – driven by multiple disruptions for the foreseeable future – is composed of four essential capabilities that each executive leader must master, according to the Alix Partners report. “Setting a compelling vision and effective strategy and holding people accountable is now expected,” said the firm. “The next level of leadership is built on these four capabilities:”

• Capture:  Leaders must capture the energy and imagination of their employees through their communications and visible actions, the alignment of their behaviors and decisions with their values, and their ability to put the purpose and mission of the organization into their own words.
• Connect: Leaders need to really listen to their employees, understand their needs and priorities, and not use a one-size-fits-all approach for anything. This is where they need to demonstrate they know how to balance people with profits.
• Cascade: Through their executive team and the next levels below them, CEOs need to cascade the right behaviors, based on the firm’s values and purpose, so that there is alignment with key decision-makers throughout the organization. These behaviors need to drive an organization system that rewards, selects, develops and recruits in an aligned manner, all driven from the top.
• Catalyze: CEOs will by definition then need to drive and accelerate the transformation of their organization, reinforcing a new or renewed culture. Their organization will transform – to some degree – and it is through this transformation that an effective antidote to disruption can be realized.

Authentic Leaders

“Authentic leadership was essential during the crisis and authentic leaders are better suited for this recovery,” said Andrew Wallace, managing partner of Leathwaite. “They are aware of their strengths, their limitations, and their emotions. They don’t hide their mistakes or weaknesses out of fear of looking weak. They are mission driven and they do the job in pursuit of results, not for their own power, money or ego. Authentic leaders lead with their heart, not just their minds, showing empathy and care for their employees. They listen to their teams and involve them, where possible, in decision making. And they focus on the long term, not just this recovery phase.”

Mr. Wallace says that technology mindsets are in demand today. “While leaders don’t need to be the technical experts, they do need an appetite to explore and embrace the opportunities that technology offers,” he said. “Be that new technology that can provide competitive advantage in the products and services that firms offer their clients, or the efficiency gains that can make their boat go faster. Digital marketing opportunities, cyber-crime resilience, AI and robotics advancements, new social media channels are just some examples of that technology mindset that’s more in demand today.”

Switching from a crisis leadership lens to a growth and opportunistic one, according to Mr. Wallace, is now critical. “While there are many similarities between the two, like authenticity, empathy and a focus on culture, there is a need to focus more time on growth and ensure the longer term strategy is fit for this new world,” he said. “All major crises are unique, as are their roads to recovery. As it has been described before, we’ve all been through the same storm, but in different boats. Having the ability to adapt to this unique and new environment will be a critical differentiator between those who succeed and those who don’t. There remains a lot of unknowns and the impacts of COVID remains a disruptor to anything like a smooth recovery.  But continuing to get their employees to focus on the longer term, will be a key skill as well as a key challenge for leaders today.”

Modern Leaders

With the pandemic interrupting global supply chains, there has been a renewed focus on leaders who have successfully led end-to-end supply chains in times of chaos. “A lot of CEOs, CFOs and so forth have become wartime leaders, operating to transform organizations amidst unprecedented chaos and disruption,” said Kevin O’Neill, founder and managing partner; and industrial, private equity, and board and CEO practice leader for Acertitude. “We view our role as going well beyond completing searches. We’re working with CEOs and other senior leaders to help them shape the future of their organizations.”

Unifying Leaders

The successful modern leader will be called upon more than ever before to unify their companies around a distinctive purpose and rock-solid values, said Rick DeRose, founder and managing partner, technology practice, Acertitude. “When you take into consideration the impacts of COVID-19, DEI, ESG, social media, and the current political landscape, fusing a company together successfully will call upon an entirely new level of management skills,” he said.

Entrepreneurial Leaders

 “I have always been a student of business entrepreneurship,” said Ruben Moreno, HR practice lead for Blue Rock Search. “One leader who has always fascinated me is Henry Ford. His actions as a leader built a company and threatened its very existence when times changed. Why? Because all too often leaders are products of their times, and when times change, leaders cannot. And while the business climate is returning to normal, the work world is never going to look the same as it did in January 2021.”

So, to look back further in history, Mr. Moreno says leaders could learn something from our sixth president, John Quincy Adams. He said, “If your actions inspire others to dream more, learn more, do more, and become more, you are a leader.” To Mr. Moreno, this type of thinking is what servant-leaders embody. “They are there to help all in their organization transform and reach their potential,” he said. “Today, I believe that means creating a positive culture, guiding their company in their DEI journey, and working to create a sense of shared, positive purpose.”

“While every executive position requires something different, I believe there are a few must-have requirements,” Mr. Moreno said. “First, every Blue Rock Search client is looking for a good communicator. I define that as someone who listens well and demonstrates emotional intelligence when speaking. This is less a skillset than a mindset, but you need leaders who aren’t afraid to embrace new technology. If you have this mindset, you can figure out the skills you need to use any technology that comes your way – and who knows what will come?”

“Leaders also need higher levels of analytical abilities today, because every executive position is going to have data and reports to read, review and act upon,” he said. “Last of all, I think companies are looking for hires who have superior problem-solving skills, not just for the structured problems that go along with the job, but for all the unstructured problems that pop up along the way.”

Evolving Leaders

Normal is continuing to evolve and for most sectors will not be pre-2020 normal, said Rob Bowerman, founder and president of The Bowerman Group. “Leaders must demonstrate the ability to coalesce their internal and external partners around a clearly articulated vision for the future and strategy to achieve that vision,” he said. “Keen awareness of the global market and their organization’s positioning within their market is paramount, while also being aware of external factors such as political and environmental concerns.”

When asked what skill-sets are more in demand today, Mr. Bowerman said: “The ability to listen to internal and external partners and clients, then use that information to make sound decisions for the advancement of the business. Filter decisions from an empathetic and authentic point of view. Be nimble and able to flex processes, not in a reactionary way, but proactively to maximize revenue and resources.”

“We are in unprecedented times when it comes to changing workforce dynamics,” Mr. Bowerman said. “The demand for adaptability, compassion, cultural awareness, pitch-perfect messaging, and flawless reading and prediction of trends has never been higher. The top leaders are able to navigate these waters confidently and empower their teams to do the same.”

Adaptable Leaders

During the height of the pandemic, leaders of many organizations had to adapt to “crisis-mode” and adopt a highly directive style, in order to take quick, (and sometimes painful) decisions to safeguard their business, said Zarina Contractor, a partner at Wilton & Bain in London. “As COVID (hopefully!) starts to recede or at least become more manageable and global economies open up, we are experiencing an extremely buoyant labor market, particularly in sectors such as technology and professional services,” she said.

“This means that the workforce has more options than they perhaps had previously, and that certain skillsets are in high demand,” Ms. Contractor said. “In order to attract and retain the best talent, as well as successfully adapt their organization to the new way of working, leaders today need to move away from that tough, directive style towards a more flexible and collaborative one. They need to recognize that working patterns have changed irrevocably and that performance should be measured on output rather than hours, thus empowering every worker to take ownership for their area or tasks and hopefully creating a more motivated and loyal employee base.”

“The individuals leading businesses which have bounced back quickest- or even found ways to turn the pandemic to their advantage – tend to be those who are able to build a strong, diverse cohort of people below them who can help to make decisions and implement strategy across the organization- rather than being a very top-down model,” Ms. Contractor said. “They should also be focused on the future, and how to continuously drive innovation and evolution, to be ready to face potential new challenges or create/capitalize on new opportunities quickly and effectively.”

Fundamental Leaders

“While the COVID19 pandemic has forever change the landscape of work and employee expectations of employers, the fundamentals of what separates good from great leaders remains the same,” said Nat Schiffer, managing director at The Christopher Group. “Great leaders understand themselves (strengths and skills), build teams that have complementary strengths that balance their opportunities; they are authentic, passionate, empathetic, they live their values, and those values align with their organizations and employees are recognized and rewarded for following them – great leaders walk their talk.”

“We believe that post-pandemic world has raised the bar for all leaders at all levels, the factors that separated good from great have now become table stakes for all leaders who wish to successfully attract and retain the talent necessary to moving forward in our VUCA world,” Mr. Schiffer said. “Simply saying the right things – ‘people are our most important asset’ – must be backed by behavior that demonstrates this is true in tangible ways that employee can see and feel.”

Post-Pandemic Leaders

“The leadership skill-set that is now in demand, or maybe more appropriately required, in today’s post-pandemic world revolves around those characteristics that separate good from great leaders,” said Tobin Anselmi, talent management practice leader and managing partner at The Christopher Group. “These include high levels of self-awareness, authenticity, innovation and passion, the ability to relate and connect with a wide range of people and the many different generations of employees in today’s workforces that have different expectations of employers. Today’s leaders need to have an anchor firmly grounded in who they are and what they believe and value – what behaviors will be encouraged and rewarded in their organizations. It’s the ability to balance results (profits) with people and creating an organizational culture that engages all employees to be and bring their best, true selves to work every day.”

Upskilling leaders at all levels in their organization is critical, Mr. Anselmi added. “Leaders at all levels will need to up their game and organizations will need to support them in addressing the new, higher expectations that employees have for them and their work environment (culture, workspace, location, etc.),” he said. “This support will need to take many forms from training and development, to clarification and/or articulation of values and expectations for performance management “at work” – wherever that is. In today’s more distributed workforce, leaders will need the capability to attract, develop, retain, engage and lead all associates at all levels of the enterprise, particularly front line workers and new entries to the workforce.”

Empathetic Leaders

Empathy will be needed to transition the work force back into offices, said Carol Hartman, founder of Hartman Group Consulting. “Many workers will be ecstatic to switch back, others will resist,” she said. “While many people successfully were remote employees, that should not be the only data point employers will look at for workforce planning. It is unlikely that remote working for most companies creates the interactions, team synergies, career development of younger staff and allow for appropriate technology investments to be optimized.”

“The world has made a major shift in almost every aspect and continued changes will be required,” Ms. Hartman said. “Courage from leaders to make choices to serve the greater good of society will become essential. Managing workforce and customer expectations during a global health crisis while some are pressuring this to be a political battlefield will require extreme leadership.”

According to Ms. Hartman, COVID is the biggest issue for leaders today. “I think there will be many unexpected retirements in the coming quarters,” she said. “Many leaders are fatigued by the COVID workforce challenges, are near retirement and have set up their own remote work setting in the home they plan to retire to. I believe that when they are required to return to office, the prospect of that is less appealing than retiring. We are in for much more change over the next year, especially as COVID surges among the unvaccinated.”

Inspiring Leaders

“We are hoping to continue seeing the business climate trend towards a ‘return to normal,’ but this seems to be a daily moving target,” said David Peterson, managing partner, Direct Recruiters. “With that in mind, and assuming that the business climate trends towards what will be our new normal, the types of leaders best suited to guide companies moving forward will be transformational and inspiring. The pandemic has put leaders in a challenging situation where being adaptable and resilient are key in keeping employees motivated, and overcoming obstacles that most of us couldn’t even imagine prior to 2020.”

“A trend we are seeing in the hiring landscape is the demand for every leader to have exceptional abilities to attract extraordinary talent for their organizations,” Mr. Peterson said. “These individuals need to be able to manage leadership as a primary ROI, delegate, listen and embrace change for their companies. At the same time, these leaders must focus on honesty, integrity, humility and personal wellness.”

Related: Skills Gap Points to Why We Need to Invest in People

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media