Executive intelligence for winning in volatile, uncertain, complex and ambiguous markets (2)

Fight or Flight?

Studies into Executive Instincts during an economic crisis show that there are two basic categories: there is the Retreat Instinct driven by the fear of loss, failure and devastation and there is the Advancement Instinct fuelled by Informed Confidence, Insightful Engagement and Measured Optimism. A review of the last century of Economic Crisis, from the 1929-33 Wall Street Crash, to 1973-74 Oil Crash, the 1987 Black Monday, 1997 Asian Crisis, 2001 Dotcom Crisis, the 2008 Subprime Crisis, 2015 China Black Monday, right up to the 2016 Global Oil Price Crash, points to one well established fact: the Emotion of Fear has done more to destroy business initiative than over-confidence and optimism has done to push business leaders off the proverbial financial cliff.

Executives will always find reasons to support their fear or optimism. This will then become a self-fulfilling prophecy as their instincts for action drives the activities that create the future they fear or the one they have confidence in. While instincts for actions maybe similar, Retreat Instincts and fear creates panic actions leading to rushed asset sales, unstructured and inhuman layoffs, shrinking of product and service portfolio and ultimately poor priced market exits.

Executive Advancement Instincts usually leads to deeper levels of innovation and radical thinking to match the disruptions, which for most cases leads to reinvention of the business revenue and product mix, mergers and acquisition, unprecedented business transformations to drive efficiencies, measured and informed rightsizing, intelligent talent sourcing and outsourcing, creation of new market spaces and segments etc.

Once Executives demonstrate the corresponding actions from either of these two instincts, the organisational emotional wavelength has been set. While the Retreat Instincts and Actions guarantee that managers and employees across the organisation become increasingly de-motivated and business momentum grinds to a chaotic halt, Advancement Instincts drives the workforce to rally around new radical strategies and reinventions, leaders are inspired to create the sense of urgency necessary to breakout into new territory, managers confront the brutal realities and employees are mobilised to support broad-based actions that allow the organisation respond quickly and adjust to shorter decision making cycles. In the end, Executives and Organisations with Advancement Instincts do much better.

Take Charge

So how do we demonstrate Advancement Instincts?

1. Executives must simply believe in their potential and that of their organisation and people to succeed and thrive in these Volatile, Uncertain, Complex and Ambiguous Operating Environments;

2. Executives must engage in Aggressive, Radical and Flexible Strategic Reviews in continual iterations. These reviews must be supported by ever deepening industry, business and environmental insights and perspectives;

3. Executives must develop and implement an agile, radical and responsive Business Model for creating New Sources of Revenue, Doing More with Less and Improving Cost and Margin Leadership;

4. Executives must provide Strategic Change Readiness and Leadership sponsorship to drive organisation-wide sense of urgency supported by clear short term action plans;

5. Executives must get off Cruise Control. When a Pilot is in a storm, he is not in cruise control, he is in charge. He is on top of all the navigational instruments and monitoring every flight success indicator. In the same way, business leaders need to institute a Strategic War Room Scenario all year long;

6. Executives must realign the Organisation (Structure, Systems and Processes and People) to the New Realities;

7. Executives must realign HR and People to the new capabilities required to excel in the New Realities;

8. Executives must take personal responsibility for seamless execution, insist on realism, drive follow through, force a culture of performance, discipline and result orientation, and keep everyone focused throughout the Crisis;

9. Executives must create quick wins and drive iterations of celebrations and recognition to inspire commitment, no matter how small the wins are;

10. Executives must saturate the organisation with positive, bold, confidence communication – literally drown out the fear.

I believe that if Executives and Organisations do what is necessary, regardless of the external turbulence, they will ride the wave and, at the other end, more resilient, more successful and more mature corporations of enduring impact and excellence will emerge.

Bolaji Olagunju