Modern leadership in times of disruption

Pandemics, inflation, artificial intelligence and a permanently changing world of work – disruptions no longer seem to be an exception, but a permanent condition.

But how should we deal with it? How much adaptability can be demanded of workers? What does all this change amount to?

These are the questions that drive many of us. First and foremost, managers in companies must develop and communicate an attitude that can guarantee them and their employees both the ability to act and mental health.

In this blog post, we discuss what such an attitude can look like, what skills modern leadership requires, and what opportunities are hidden behind ongoing disruptions.

1. Modern leadership in uncertain times

Even before the pandemic, many employees and managers were tired of the ongoing reorganizations and ever-changing technological frameworks. The uncertainties of the pandemic had resulted in employee capacity to keep up with change being only 50% of pre-pandemic levels (Gartner).

Instead of a phase of relaxation, however, the pandemic was followed by economic uncertainties, which are now in turn apparently being surpassed by disruptions caused by artificial intelligence.

The fact that managers have to moderate permanent change in these uncertain times is a real challenge. At the same time, however, it can be stated that modern management can fulfill this task.

A modern management style includes, for example, not simply imposing new requirements top-down. If you really want to take your employees along with you when it comes to change, you should respond to their individual expectations, wishes and abilities.

Modern leadership should create spaces for employees within which they can act with a minimum of creative freedom and personal responsibility. Current examples show that this approach is demonstrably more successful than a purely top-down prescription:

2. Change Management Strategies

Rowland, Thorley, and Brauckmann provide insight into how large-scale, long-term, and complex change processes can be successfully implemented in companies in the Harvard Business Review.

There, they find that change management executives are too often focused on the what (e.g., a new strategy) rather than the how (i.e., exactly how to implement that strategy internally).

The authors distinguish between four models, two of which have repeatedly proved problematic:

  • Direct change processes: The management level defines very precisely the what and the how of the change and carries out strict controls during implementation. Communication takes place unilaterally.
  • Change through self-organization: While the management level sets the direction of change centrally, the implementation and use of appropriate resources is left entirely to the local sites. The motto is “try everything and see what sticks.”

Both of these approaches have proven to be less than successful in reality. The authors state in this regard:

“Directive and self-organizing change are most common in stories of low success in complex change, with self-organization always negatively correlated with change outcomes. Such simplistic approaches, while most prevalent in our research, will not suffice in today’s dynamic, interconnected world.”

Approaches that give employees greater freedom in implementing or even helping to shape changes are therefore more promising:

  • “Masterful Change.” The direction of change is set by the management level. At the same time, a lot of time is invested in communicating these changes and refining them together with the employees. The employees are given freedom in their implementation, for which they are provided with supportive framework conditions.
  • Emergent change: Here, the direction of change is only loosely determined by the management level. Instead, leadership focuses on core elements and allows independent experimentation by employees combined with rapid feedback loops and ongoing observation and support.

While these two approaches differ in terms of the precise targets set by senior management, they are united by a high level of communication, cooperation and trust.

3. Modern leadership, change and artificial intelligence

While the lessons from these different approaches are generally important for modern leaders, they may have unprecedented relevance with respect to upcoming change processes in the context of AI.

On the one hand, AI technologies will lead to widespread changes that must be implemented across the enterprise. This requires change management that is equal to the size and complexity of this task.

On the other hand, artificial intelligence is accelerating an already existing trend in the world of work, in which people expect more meaning from their work. Part of this dynamic is a reduction in purely administrative, executive tasks, which could be rapidly accelerated by AI.

As a consequence, more capacities are freed up for strategic and interpersonal tasks. This applies to employees as well as managers, who according to a survey spend 54% of their time on administrative tasks.

Against this backdrop, emotional, social, communicative and strategic skills take on a new significance – skills that are indispensable in modern leadership.

4. Implications for HR

HR staff naturally have a good overview of the internal structure of their companies and therefore also of the change processes taking place within them. Above all, they know the different employees and have a feeling for their current needs and problems.

HR should therefore be a direct point of contact for management when it comes to establishing large-scale change processes in collaboration with employees.

Part of these processes – as was clear from the case studies above – is to establish communication structures and feedback loops that are so important for successful change management. However, change processes also include monitoring employee workload and satisfaction and taking action where necessary.

In the age of ongoing disruption, human resources will therefore continue to play a central role in the future.

5. HR Consulting around organizational change

Are you facing organizational or technological change processes in your company? Then an outside view can contribute valuable insights into how these processes should be structured and implemented.