Five leadership qualities that will help organizations reinvent themselves in the face of climate, technology, and societal megatrends.
Most business leaders today have realized that we are living in an era of “great reconfiguration.” This is a time when entire industries, economies, and societies are changing dramatically. However, due to the pressure of short-term challenges, few leaders can truly comprehend the scale of these changes. Even fewer understand the transformation their organization requires and the leadership skills they need to develop to be effective right now.
What has changed?
Today’s leaders face a unique combination of circumstances. In the short term, there is inflation, supply chain disruptions, wars in Ukraine and the Middle East, the risk of recession, and labor market instability. In the long term, there are powerful megatrends: climate change, technological transformation, demographic shifts, social instability, and global fragmentation.
What makes this moment unique is that megatrends increasingly trigger and exacerbate crises. Leaders must therefore respond to both the present and the future. They must transform their organizations to address megatrends while using current crises as catalysts to accelerate change.
The scale of the transformation is unprecedented.
The changes required to succeed in a megatrend world are unlike anything leaders have faced before. For example, the transition to a sustainable economy requires a complete reconfiguration of industrial systems: how we produce food, how we move, how we build, power, and create products. This will affect companies across all sectors, from energy and transportation to agriculture and manufacturing.
This transformation involves massive changes on both the demand and supply sides, requires the coordinated actions of thousands of interdependent players, and must occur quickly and on a global scale.
Technological changes
Technological transformation requires rethinking not only business models, but also the organization of work itself. Artificial intelligence, autonomous vehicles, machine learning, automated content creation tools — all of this is changing entire industries. Quantum computing, blockchain, and industry-specific tech innovations require teams to redefine the value they create and how they achieve it.
New scale and dynamics of transformations
Not only has the need for change become universal, but the nature of transformation itself has changed. The scale, the speed, the involvement of multiple stakeholders, the impact on audiences that were rarely considered before.
The ability to constantly transform
Systemic change requires leaders and organizations to adapt and evolve continuously, rather than to reform once and for all. To survive and grow, organizations must continually rethink their roles and ways of working.
Five Traits of a Transformational Leader
Based on global research and work with companies, five key qualities have been identified that distinguish transformational leaders.
- They shape the understanding of the world — to see how an organization can create value in a new, more complex system. This requires engaging multiple perspectives, analyzing political, economic, and technological factors, and explaining the big picture in simple terms.
- They set radical goals — create ambitions that make the organization the author of its own story. Such goals focus on significant problems that the company can solve and require the team to go beyond the usual.
- Achieve results — Transformational leaders don’t just inspire, they personally engage in change. They create new systems, rethink metrics, processes, and approaches so that the organization can surpass itself and realize its ambitions.
- They act as catalysts - attract key talent and bring together the diverse resources needed to solve complex problems.
- Maintain the team's energy — ensure sustainable development, learning and engagement throughout the transformation and beyond.
These qualities are important not only for directors and top managers, but also for everyone who can influence change – from line managers to leaders without formal status. Transformational leadership is a skill available to anyone who is ready to take responsibility for the future.
How to Make Big Decisions—and Stick to Them
Transformational leaders make many critical decisions: how to structure the organization, what technologies to implement, what assets to sell or keep. This is often the most difficult part of leadership.
Effective practices:
- Rely on megatrends. Focus on what you know for sure: global shifts are a fact. Rely on them when formulating decisions.
- Consider all sides. Involve different viewpoints, encourage alternative opinions. Strategic simulations and role models (devil's advocate) help evaluate the consequences of decisions.
- Calculate the cost of inaction. In situations of uncertainty, inaction is often more dangerous than action. Formulate what will happen if nothing changes - this will increase the motivation to act.
How to Gain Support and Maintain Focus
- Involve a wide range of stakeholders. Justify to your board, investors, partners, employees why the decision is important. Be honest about the effort, timeline, and tradeoffs.
- Put the customer at the center. Prioritize steps that directly impact customer experience. This mobilizes the entire organization.
- Get people involved. Explain how the changes will impact employees and empower them to become active participants in the transformation.
The ability to move forward
- Be realistic. Accept that change will take time.
- Keep the message alive. Regularly remind why all this is being done. Demonstrate progress on key metrics.
- Separate strategy and tactics. Mistakes at the tactical level do not mean failure of the global goal. Correct the course, but do not abandon the direction.
Self-sustaining leadership system
The five qualities of a transformational leader form an interconnected system. Working on one aspect strengthens the others. Ignoring any one of them can weaken the effectiveness of the leadership as a whole:
- Without understanding the world, you risk choosing an irrelevant goal.
- Without a radical goal, an organization will not move beyond its comfortable limits.
- Without results, ambitions lose strength and people lose motivation.
- Without the role of a catalyst, you will not attract the necessary resources.
- Without the support of the team’s energy, the process will fizzle out.
The good news is that developing any one of these aspects positively influences the others. For example, by acting as a catalyst, a leader not only attracts talent, but also helps the team better understand the world, formulate ambitions, and achieve more.
Leadership as a challenge and an opportunity
Today's challenges are so complex and interconnected that most organizations will have to transform constantly. For some, it's a matter of survival; for others, it's a chance for a qualitative leap. However, not all companies have the necessary leadership potential. Many do not realize the scale of the leadership deficit, and current leaders often have neither the time nor the support.
Yet, despite all the reasons for delay, the challenge for leaders now is to overcome the limitations of the system and lead the transformation. This is the essence of leadership: shape the future for others.
