Our world of unpredictable and uncontrollable change presents a huge leadership challenge.  How can we survive and even thrive when our environment turns against us?

Bob Miller was the CEO of Rocky Roads Corporation, the dominant regional provider of rocks used for building roads.  After 18 highly profitable years, they suddenly dropped behind two competitors. Due to a combination of unforeseen changes, sales plunged from $60mm to $30 mm.  They went from $6mm profit to a loss of $2mm in only two years. Bob hired a firm that helps companies thrive in a changing environment. After one year of working together, Rocky Roads reached break-even.  In two years, they climbed to a $7 million profit. Their engagement levels are now higher than the “good years,” and Bob enjoys his job more than ever.

Become a Flexible, Adaptive, Learning Organization

The pivitol point was when Bob’s mindset changed.  He realized that what led to success in the past often doesn’t work today.  The primary leadership driven characteristics needed to thrive now are:

1. Flexibility – The willingness to change or compromise.

2. Adaptability – The ability to utilize flexibility to meet the demands of new conditions.

3. Learnability – The ability to quickly learn new knowledge and skills that are required to meet the demands of new conditions.

As a leader, implementing these traits, as allow you to become a Flexible, Adaptive, Learning Organization (FALO).  A FALO provides a unique competitive edge in an unstable environment. The key mindset shift by the leaders is to focus on the things that lie in your area of control rather than constantly reacting to things out of your control.   Instead of things getting easier, you get better!

How do you develop a FALO?

Below is a five-step process to creating a FALO

1. Shift your mindset from solving problems via processes and technologies to solving people problems first.  All business problems (including process and technology problems) are people problems at their root since people select, develop, operate and manage your processes and technologies.  The perfect processes and technologies with the wrong people or with people who are not using them properly will never work. A process and technology focus is a convenient distraction away from the more challenging arena of human beings.  However, starting with processes and technologies is treating the symptoms, not the cause. Your solutions will always be suboptimal with this approach.

Step 2: Create a personal development mindset as an organizational strategy
The key to your growth as a leader is your personal growth and development.  We take ourselves with us everywhere we go, and your self-awareness, skills and character traits are your only tools.  It’s critical to realize that these elements of personal growth are developed not inborn.  Certainly, you have inborn gifts.  However, none are very useful until they’ve been developed over time.  

History’s most successful CEOs such as Jack Welch of GE, Lou Gerstner of IBM and Ray Dalio of Bridgewater shared a common leadership philosophy. They recognized that as people work on their personal development, they contribute far more productivity, collaboration, and positive energy/engagement as benefits.  Each of these benefits enhances the others to create a multiplier effect throughout the organization.  As people develop, they also adapt much better to ongoing life challenges. The organization’s knowledge and skills (learning) increase while becoming more flexible and adaptive.

Step 3: Develop a culture that supports ongoing personal development

Developing a strategy of personal growth requires that you develop a culture that supports this strategy.  Organizations frequently fail to execute their strategies due to lacking a culture that supports these strategies.  Peter Drucker said that “Culture eats strategy for lunch.”

Google provides one of many examples of an organization that focuses on culture as a key driver of its success.  Here are their “three principles for a top-notch culture.

 

  1. Mission that matters – A clear mission and vision statement to motivate and unify employees.
  2. Transparency of Leaders – A crucial element to build safety, trust and collaboration that requires openness and vulnerability.  
  3. Giving everyone a voice – Aperspective that values everyone’s opinion and point of view.

Do these principles apply to other companies?  Yes, in fact, it’s more difficult to apply these principles in large organizations like Google due to increased layers of complexity

 

Step 4: Starting with the leadership, take an open, honest inventory of weaknesses
A weakness is any habitual behavior that impairs your effectiveness, which prevents you from becoming who you want to be. Having weaknesses is an unavoidable part of being human.  The key is to deliberately identify and acknowledge these habits rather than trying to hide or cover-up. Your weaknesses are obvious to others anyway, so attempting to deny or hide them impairs our growth and relationships.   

The authenticity of leaders about their weaknesses builds trust and respect and creates a culture where people feel safe to do the same.  Research and experience consistently demonstrate the importance of people safe feeling safe. People won’t allow themselves to be open about their weaknesses until they feel safe from ridicule or punishment.  

Step 5: Commit to a process of ongoing improvement
The key is that the leaders’ commit with both their hearts (emotions) and minds (thoughts).  Developing new habits that serve you better than the old ones requires committed effort over time.  Demonstrating this commitment helps develop a culture of people committed to their personal and professional growth.  

It’s also important to develop a culture of constructive feedback and encouragement since you often don’t realize when you revert to old habits. Ongoing improvement is difficult without a culture that supports people making a consistent effort.   

 Developing a FALO is not complicated.  It starts with a mindset shift from focusing on the external environment to focusing on the source of your success and power—the ongoing development of human beings.  You can try to control your external environment or adapt to meet (or exceed) the demands. Which approach will you choose?