Thursday, January 29, 2009

Antidotes to Uncertainty: Adapt and Innovate

Financial history is a roller-coaster ride of ups and downs, bubbles and bursts, manias and panics, shocks and crashes.

---Niall Ferguson, The Ascent of Money

We are learning from our current worldwide financial crisis that the assessment of risk and uncertainty are two different concepts, two different thinking modes. Risk relates more to what we already know projected onto a number of future scenarios. As Niall Ferguson explains, risk is measureable uncertainty. That leaves real uncertainty as unmeasureable and thus as unknowable. Ferguson quotes John Maynard Keynes from his 1937 book General Theory: “There is no scientific basis upon which to form any calculable probability whatever. We simply do not know.” If only more of us were Ph.D. trained mathematicians!

Because surprises do happen despite our best efforts, leaders are in a bind. If the “long view” generated through strategic and scenario planning is limited (yet still relevant for mitigating risk), what can a leader do to off set disaster (uncertainty)? Darwin long ago gave us hints—adapt to our environment or perish. “The wild rewards the capable, adaptable and instinctive” explains Gino Ferri, professor at Laurentian University author of The Psychology of Wilderness Survival.

Anyone who has taken survival training knows that adapting is no easy matter. It’s down right scary. Leaders need some help!

Given the difficulty of figuring our how to adapt, one predominant message for leaders is to surround ourselves with great people who are diverse in expertise and who do not necessarily share our point-of-view. If “a team of rivals” worked well for Abraham Lincoln, as historian Doris Kearns Goodwin contends, then it should work now. This means reaching out to one’s broader network and replicating the “team of rivals” at other key nodes.

A second important message is to set up an environment for innovation. But, people can’t innovate well in an environment of fear. With daily job losses everywhere in the world, it’s hard not to feel anxious. The “team of rivals” approach fits well with setting the stage for novelty in thinking according to creativity researchers. The depth and breadth of knowledge elements available with minds from different disciplines and experiences increase the opportunity for unusual possibilities from which to choose---for real innovations. They suggest, in addition, that leaders consciously develop a positive emotional environment of surviving and thriving despite uncertainty to foster the creative spirit.

According to Teresa Amabile and others, there are spin-off bonuses to an emotionally positive work environment. The effect lasts for days. If the leader works at stoking the fires of hope and possibility, the positive feelings can last indefinitely, as well-documented in current brain research. These are greatly assisted by the joy individuals feel when generating ideas. It seems our brains and our beings thrive in such environments.

There is ample evidence from the history of long-lived organizations that adapting and innovating are central to survival. This is encouraging for all leaders grappling with the chaos we are facing.

Arie de Geus’s template for survival in a turbulent business environment provides further guidance. In his study of long-lived organizations (The Living Company), some more than 400 years old, he found four “habits”:

1. Sensitivity to the environment (learning and adapting)
2. Cohesion and identity (building a community with a cause)
3. Tolerance (ability to build constructive relationships with other entities within and outside itself)
4. Conservative financing (ability to govern its own growth and evolution effectively)

If, as Ferguson observes from his study of the history of money, that booms and busts are products, at root, of our emotional volatility, then, the lessons from surviving the “wild” can temper such ups and downs in our favour. This takes leadership of the right kind. Not greed. Not self interest. Not every “man” for himself. Instead, it heralds leadership which trumpets teamwork, respect for each other, including divergent views, and the certainty that together we can adapt, innovate, survive and prosper.

Monday, January 19, 2009

Barack Obama's Spirit Has Taken Hold of Me

The world’s in a big dance. Everyone is a belle at the ball of an unprecedented historical event. For those that get suspicious when walking into a room of smiling people, this must be unnerving. Yet, the warmth and goodwill swirling around our feet and heads seems infectious. Is it possible that the more generous feelings towards each other catalyzed by the arrival of Obama at our doorstep are manifesting themselves in all manner of acts of kindness?

As a sample of one, I have found myself taking unusual steps towards helping others. The acts of kindness have come out of the blue as if they landed on me from afar and I just had to pass them on. These actions are in addition to my normal pattern of “being there” for others. I suspect that millions upon millions of others are also finding themselves leaning more towards others than is typical.

We appear to be witnessing the favorable impact of an inspiring leader. This is encouraging. Although we face extremely difficult times, just maybe our collective willpower will enable us to get ahead of the curve.

Historian Niall Ferguson who has been on a round of interviews about his new book The Ascent of Money paints different scenarios for the future, some quite grim. But he does believe that innovation and collaboration globally can get us through.

These we know are powered by our imaginations and feelings of goodwill. Barack Obama has given us a nudge. Provided he keeps up his end of the bargain, and we have no reason not to believe he means what he says, we may find that the flywheel of change and transformation gains traction and speed quickly.

Monday, January 05, 2009

"I'm here to listen and learn" is an Obama refrain: Is he for real?

When I happened upon a CBC documentary on Barack Obama’s visit to Africa in August 2006, I couldn’t help think---is he for real? Over and over again he said to the ordinary folks, “I am here to listen and learn.” Frankly, I couldn’t believe my ears. The words almost sounded strange because they have not been commonly used by George W. Bush. “I’m the decider” has been more his style and phraseology.

After too many years of that kind of rigid leadership, I view Barack Obama through slightly jaded eyes. It is not that I don’t want to believe in what he is saying and how well he has put together a transition team. It’s just going to take some getting used to. The natural tendency is to not let one’s expectations rise too high in case they are dashed!

But, to use the well-worn phrase, I am “cautiously optimistic”. Scientists likely identify with my feelings. When President-elect Obama announced Steven Chu, a Nobel-prize winning physicist as his Energy Secretary, according to various media reports, most let out a collective sigh of relief.

Obama’s words on the role of science in his administration no doubt came as a happy shock. “My administration will value science.” “We will make decisions based on facts and we understand that the facts demand bold action.” Yikes! Can he really mean this? After years of ideology trumping science and non-scientists over-ruling scientists, is Obama really going to stay the course of not omitting inconvenient facts if they don’t suit his position?

A look back into Obama’s history yields some hope, literally. His book Dreams from My Father is chock full of clues. Barack Obama’s mother set the stage for his values. Obama describes his mother as “a lonely witness for secular humanism, a soldier for the New Deal, Peace Corps, (and) position-paper liberalism.” His father’s birthplace in Kenya provided concrete evidence of the struggles of ordinary folks. He also witnessed the poverty, the corruption and the constant battle for security in Indonesia where he lived for a while with his mother and her second husband. Empathy for the little people appears to have been “bred in his bones”.

Obama tells story after story of observing the challenges of people in his travels and most significantly through his efforts at becoming an effective community organizer. This is a guy who went around interviewing people in a down and out area of Chicago to find out what they wanted to change to make their lives better. Various mentors took Barack Obama under their wings and slowly but surely helped him through the extremely frustrating challenge of community development. My head tells me that no one would hang in for as long as Obama did without being truly sincere in his quest to help, to listen and learn.

In his words, he describes the apathy he encountered in a neighborhood and the insights that arose from such an experience: “As it was, many had already given up the hope that politics could actually improve their lives…” “Yet what concerned me wasn’t just the damage loose talked caused efforts at coalition building, or the emotional pain it caused others. It was the distance between our talk and our action, the effect it was having on us as individuals and as a people.” “The continuing struggle to align word and action” and the role of self-esteem in rising out of despair, “led me into organizing.”

Now, he has been given a chance to align word with action on the world stage. This deeply curious and reflective leader has a huge agenda and also a strong foundation where he has learned what matters at the feet of ordinary/extraordinary people.

I will watch with great anticipation. His lessons of triumph and failure will be a backdrop for learning more about how to succeed as a leader in our current world of chaos and opportunity.