It is a double-whammy: Low economic growth and high uncertainty. For many businesses, these are testing times. The commercial challenges are obvious and in our faces, day-to-day. And the responses they demand are generally well understood, too: Innovation, efficiency and adaptability are the rallying cries of the besieged. But there is something else, as well. The challenge of these times lies not just in these responses they demand, but in the fact that they also make these solutions harder to achieve. Because tough times and uncertainty also change the way people behave. And not in a good way.
Behind the immediate commercial challenges, then, hard times also breed certain cultural dynamics within businesses. These cultural changes are usually less noticeable than the commercial ones, yet as such they tend to be more insidious. They can become like cultural toxins, lurking beneath the surface of day-to-day operations, while poisoning a business’ ability to respond effectively. Indeed, tough times have been shown to breed a whole host of negative behaviours, many of which are the polar opposites of innovation, efficiency and adaptability.
The Seven Cultural Toxins
The most personally obvious toxin for most people is stress. Unsurprisingly, levels of stress in senior leaders have repeatedly been found to higher in tough and uncertain times, and while stress can have all sorts of impacts on people, few of them are positive. Rare is the leader made better by stress.
Then there is gossip and political behaviours – both of which have been found to increase with higher levels of ambiguity and lower business optimism. And the foundations undermined by gossip and political behaviour are trust and collaboration.
Similarly, hard times tend to also see an increase in silo-ed operating. People become more head-down and focused on just achieving their immediate objectives, and less willing to do anything – like helping others - that places pressure on their resources.
And related to this, there is the danger of a descent into detail. As hard times tend to increase focus on delivery and targets, so leaders can all too easily find themselves more drawn into the detail of delivery. Everyone seems to step down a level as delegation becomes derailed, and strategic thinking forgotten.
Finally, come three toxins that all undermine decision-making. First, is that group-think – the tendency for debate and dissenting voices to be supressed – becomes far more common. Second, is that decisions tend to be driven more by short-term pressures. And third, are changes to the pace of decision-making. Businesses tend to show one of two responses here, with leaders becoming either more rapid, or more risk-averse and slower. This is sometimes entirely appropriate to the times, but it also increases the likelihood that leaders will drift into being too fast or too slow.
So these are the seven most common leadership toxins spread by tough times and uncertainty. Not all businesses will experience all of them, but most will be touched by some of them. And unchecked, they act like poison to businesses’ ability to respond effectively to the commercial challenges they face. Trust can fall; collaboration drop; and the quality of decisions wavers. There are things businesses can do though, to counter these toxins, and five things stand out.
- 1.Increase Clarity. Ambiguity breeds gossip and politicking, and reduces collaboration and cohesion. So one basic thing leaders can do is to counter ambiguity by providing certainty. To ensure everyone understands what the challenges are, and what the businesses response will be. And to make sure everyone knows where the business is heading, who is accountable for what, and what needs to happen next. Recent events have thus witnessed an upsurge in firms proving communications support to the leaders, helping them shape, message and cascade their clarity to their businesses.
- 2.Strengthen Voice and Insight. Possibly the most insidious toxin is the tendency for people to stop speaking up and speaking out. It’s hard to notice, but it stifles information flow and robs leaders of the insight and opinions they need to make good decisions. This is why at the same time as being clear about what is required and where the business is heading, leaders also need to show greater curiosity about options and opinions and greater tolerance for challenge. And they need to be systematic in how they do this to ensure that they have the best possible intelligence available.
- 3.Focus on Collaboration. Heightened stakes tend to focus people on their own objectives, at the expense of collaboration. The solution lies partially in the clarity mentioned before, but businesses are also increasingly taking a more systematic approach to driving collaboration. Formal or facilitated reviews of key cross-unit collaborations are becoming more common, unpicking relationships within and between teams in an effort to drive more efficient and effective functioning.
- 4.Driving Delegation. There is nothing wrong in people become more focused on meeting their targets, per se. But witnessed in all too many businesses is a tendency for leaders to overdo this – to get dragged down into the detail of delivery in order to ensure their targets are met. This has two key negative impacts. It leaves leaders with less time for strategy and innovation, and decreases employee empowerment and engagement. Which is why an increasing number of businesses have included in their response to these troubled times brief, focused development interventions aimed at driving better levels of delegation.
- 5.Foster Resilience. Finally, a core challenge for leaders is to be able to manage not just their own levels of stress, but also that of their people. The consistency of leaders’ behaviour has been shown to be especially important here, and realising this, more and more businesses are helping leaders identify and better manage their ‘pressure points’ - the situations that for them can drive uncharacteristic and unhelpful behaviours. And the other side of this, higher levels of stress can reduce leaders’ ability to notice and help the stress levels in their team, as well. And so there are an increasing number of tools becoming available to help leaders manage and improve the resilience levels in their people.
These are not all the cultural toxins to be found, nor all the responses that can be made. What is important here is just that organisations become more alert to the spread of these toxins, more aware of their vulnerability to them, and more proactive in addressing them. Firms have to focus on the commercial challenges tough and uncertain times can create. But if they are to meet these commercial challenges, or at least avoid the cultural scars that can be left by them, they need to also start facing up to the cultural toxins and challenges that can be spread with them, too.