Embracing change, becoming better leaders

In this time of accelerating change, we’re seeing transformations in our products, services, experiences – and also in the business operating models that underpin them. 

At the Macquarie Perspective event, Emergent CEO Holly Ransom described the shift from efficiency to effectiveness in successful businesses. From standard processes and ‘command and control’ hierarchies to crowdsourcing, empowerment and autonomy. 

We’re now focusing on outcomes, not outputs – and leading small, nimble teams willing to embrace variability within guardrails, rather than large monoliths. 

So, what does this mean for the way we lead? 

“We’re all in the business of leading change in ourselves and in others.” 

Kristen Hansen, founder of EnHansen Performance, showed how understanding how we think can help us shift from being managers to agile leaders of change and performance. 

And this is grounded in neuroscience. Our pre-frontal cortex, responsible for rational thought, language and decisions, is only capable of four peak hours of activity in a day. Our amygdala controls our fight, flight or freeze response – and if we’re in a threat state, it can impact our ability to make decisions.

Source: EnHansen Performance

Given we subconsciously scan our environment for threat or reward five times a second, this means our perceptions are rapidly affecting our ability to take risks, generate insights, solve problems and innovate. In a threat state, we may feel anxious, frustrated, overwhelmed – less connected, and less able to gain that sudden understanding of a complex situation. 

“So many things can create a threat state at any point in time. Amazing leaders can turn it into a reward state,” explained Kristen. 

You can reframe threat as an opportunity – it’s all about perception. She suggested a 30 second circuit break: breathe, label the emotion you’re feeling, and then re-appraise the situation. “How can you look at it differently, what can you learn from it or be thankful for about it?”

A leader can impact up to 70% of the culture and climate in their team and organisation, and that in turn impacts up to 30% of the performance.
Pia Lee, LIW

As a leader, you can use coaching conversations to encourage others to find the right solution. “Ask, don’t tell: what is your thinking around this situation? What haven’t you tried yet? Where do you want to get to?” 

This approach also works with clients. “By asking questions, you empower them to have insights and motivate them into action,” said Kristen. 

“How do you make your employees feel like they operate within a circle of safety?” 

Start With Why’s David Mead also discussed the importance of creating the right environment for trust and collaboration. “It’s the role of leaders to eliminate any internal dangers: things that make people feel emotionally unsafe, like they don’t belong.” 

When people spend their time protecting themselves from each other (and from you) – the natural human response is fear, paranoia and self-interest. “But when we trust and co-operate, we get naturally higher results.” 

David believes a great leader is like a great parent. “It’s not a rank or position, but a choice we make to take care of the person to our left or right, to put their needs before our own, and educate them to be better than we are.” 

This idea of a psychological circle of safety is central to getting the most from diverse teams. “Diverse teams with psychological safety outperform homogenous teams every day,” said Holly. She re-framed the author Tim Ferris’ claim ‘you are the average of the five people you most associate with’ as “the hallmark of great leaders will be the diversity of the five people they spend the most time with.” 

“Put ‘be-ing’ before ‘do-ing’. You can’t control what happens in the world, but you can control what happens in your mind.” 

In the age of VUCA (Volatility, Uncertainty, Complexity and Ambiguity), many team members may feel worn out or frustrated. They’re doing the things that used to work for them, but no longer finding success. 

Leading Initiatives Worldwide (LIW) CEO Pia Lee shared the three conditions business leaders need to create for a more adaptable culture. 

  • Clarity – how well do you and your team understand what your organisation and your customer is trying to achieve, and why?
  • Climate – do you have the right structure, processes, resources and culture to do this?
  • Competence – do you have the right skills, technical knowledge and behaviours? 

She gave the example of a Formula 1 pitstop – these three things have to come together perfectly to get it done in less than two seconds. 

For a business to be able to navigate the three horizons of growth concurrently – defend core business, nurture emerging businesses and create new businesses – its leaders need to establish the right environment to embrace change and perform at their best. 

“Research tells us a leader can impact up to 70 per cent of the culture and climate in their team and organisation, and that in turn impacts up to 30 per cent of the performance,” Pia said. 

By creating a common language of leadership, you can empower people at every level to make decisions and develop their talents. And this is the key to a thriving, effective business where people want to do great work and feel like they belong.

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Unless stated otherwise, this material has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL & Australian Credit Licence 237502 ("Macquarie") for general discussion purposes only, without taking into account your personal objectives, financial situation or needs. Before acting on this general information, you must consider its appropriateness having regard to your own objectives, financial situation and needs. The information provided is not intended to replace or serve as a substitute for any accounting, tax or other professional advice, consultation or service.