global sector leader, investment banking & capital markets
This Week in Leadership (June 14 - June 20)
Why remote workers are quitting their jobs en masse. Plus, the five questions all CEOs want answered during job interviews.
A recent headline in Barron’s announced it quite plainly: “Bitcoin Storms Wall Street.” And, no kidding, the cryptocurrency has jumped in value more than 10 times since the start of the year, making this year’s stock market gain look boring. Last week, it joined the financial world’s mainstream when US regulators approved the trading of bitcoin futures. This week, one of the world's largest derivatives markets, the CBOE Futures Exchange, started offering investors bitcoin-related products, with other exchanges around the world likely following suit soon.
At this kind of pace, experts say, both the currency and blockchain, the technology behind it, represent a clear threat to the way many businesses may operate in the future. And yet many corporate leaders may be still be clueless about it all. “Things are moving so fast that decisions are being made with incomplete information,” says John Petzold, senior client partner, global leader, CXO Optimization at Korn Ferry.
To some degree, however, CEOs and others can rely on various formulas from the past to deal with disruptions, even on this level. Here’s a brief roadmap:
A popular acronym for the current scenario, for example, is VUCA, which stands for volatility, uncertainty, complexity, and ambiguity. It is all the things that make life hard for business chiefs. “Management is about dealing with or surviving VUCA, while leadership is about transforming it entirely,” says Kevin Cashman, senior client partner, Korn Ferry Leadership and Talent Consulting. Specifically, that means transforming each of the VUCA problems: volatility to vision, uncertainty to understanding, complexity to clarity, and ambiguity to agility. “We do not need to manage change, we need to accelerate change into new realities,” Cashman says.
An example of changing VUCA comes from the financial crisis. “Some institutions were severely weakened, or in collapse, but there were some firms that found themselves in positions of relative strength,” says Leslie Gordon, head of Korn Ferry’s Investment Banking and Capital Markets practice. Banking powerhouse J.P. Morgan, for one, saw an opportunity to move into other areas left open by struggling firms. “They saw opportunity in a moment of disruption.”
Speed, meanwhile, is necessary during a crisis, but it isn’t the only thing leaders need. They also need to be able to work within an interconnected partnership of experts. Incomplete information is one thing, but what is an absolute must-do is to work with all the key functional areas inside a company. In the case of bitcoin, the chief information officer can’t make decisions without first consulting with the financial risk experts, says Petzold. That’s because bitcoin straddles a technological innovation with a financial one. “The leadership element means having a balance between the leadership piece and the technical pieces, and getting the right people in the right roles at the right time,” says Petzold.
Of course, just because the leader knows what to do, doesn’t mean that the organization is ready. In the end, navigating disruptive technology well is an all-in effort. “Many top leaders are capable of navigating change, but it is very hard when you get further down the organization,” says Melissa Swift, global leader for Digital Solutions at Korn Ferry.
For this reason, workforce management is changing, with the generalist reemerging to replace the dedicated narrow specialist—and with companies encouraging workers to craft the scope of their own positions. “It is something that smart employees have always done,” Swift says. This approach works best when the employee population understands the company’s goals, and where the employees are allowed to make decisions. “Our research shows that to compete effectively, empowerment and alignment are the most important things,” says Swift. “They are also the most difficult.”