"How many people will report to me? And who will I report to?” These two queries pertaining to the span of control and reporting structure, arguably rank amongst the top three, whenever leaders are considering new opportunities (the third obviously being ‘what’s in it for me’). But as the world moves from a complicated (but mostly predictable) environment to complex and unpredictable ecosystems, “authority-based” management frameworks are fast becoming obsolete.
Authority-based models measure growth in terms of resources ‘under command’. Matter of fact, in highly structured and traditional organizations like the Armed Forces or the Government, resources are often the only metric of growth, because monetary compensation does not vary dramatically between ranks. So while a Captain commands 200 men, a Colonel leads 800 and a Brigadier controls 3000, there isn’t a wide variance in their compensation. Leaders in bureaucracy too, measure their growth in terms of budgets, the relevance of their posts, perks and powers. This penchant for equating professional growth with increasing control over resources serves well in environments that are unchanging, insular and stable.
This is because, in old-school business models such as manufacturing, construction, education or government — experience has a high premium. For example, in a complex refinery, the experience can mean the difference between life and death. Veterans would know how to deal with black swan events and would, therefore, be pre-allotted the resources needed to tackle those situations. Authority-based leadership frameworks dominated management thought till late 80’s when most businesses were oriented towards standard products and services.
However, the advent of new businesses models based on Information Technology and other ‘knowledge’ industries required traditional “authority-based” constructs to be modified. Solutions such as ERPs or ‘just-in-time’ manufacturing needed flexibility and customization. In addition, every project required a different combination of skill-sets and leaders needed to assemble project-based teams. This led to a ‘coach style’ of leadership where the leader augments his/her own integral resources with those ‘on loan’ or assigned from other teams. Think about a high school football coach. She is probably not an extremely good player of the game herself but has the ability to tweak out the best from individual players and the team as a whole, by instilling basic discipline, teamwork, strategy, and tactics. Some authoritative leaders leverage their core competence and transform into a ‘coaching’ style of leadership where the stature of the leader is based on their undisputed knowledge of the subject and their ability to meld a team consisting of internal and external resources.
But the VUCA world requires a completely new style of leadership. And to understand that, we must first grasp the difference between “incremental transformation” of the business ecosystem over the past decades and the “disruptive revolution” that is happening now.
SAP was founded by breakaway entrepreneurs from IBM. Infosys was founded by breakaway entrepreneurs from Patni Computers and even Kiran Shaw of Biocon learnt her ropes in enzyme formulations from – believe it or not – beer breweries. The common thread of all these stories is that the leaders possessed core competence of a certain discipline, but were stifled in their current environments and created their own tableaus to overcome those limitations. They were past “players” of the game who attained moral authority over their teams because of their own prowess of the domain. That moral authority mutated into a leadership position because the leaders enabled their followers to achieve far more than what the latter could have, in a purely authoritative environment. Exactly like great coaches do!
But the disruptive model of the VUCA world changed all that. Elon Musk did not come from an automotive background. Jeff Bezos was not a bookseller. Uber founder Travis Kalanick had no expertise in mass transportation, and Brian Chesky took AirBnB from ideation to USD 20Bn valuation in less than a decade without any expertise in the hospitality industry. While management gurus have dissected the platform models of these new disruptive businesses threadbare, many missed the seismic changes in the management styles of disruptive models. Several traditional businesses scurried to emulate the technology and business process frameworks of disruptive newcomers without appreciating that the challenger’s competitive advantage lay in their leadership styles – not their technologies.
Businesses which flourish in the VUCA world focus on ‘core interactions’ not ‘core competence’.
For instance, Google only controls a few elements of their ecosystem, gmail, search, maps and of course, bottomless customer knowledge. They happily allow hundreds of other apps which compete with Google music, movies, hangouts, docs etc. to co-exist in the same ecosystem without feeling insecure. Similarly, Apple leverages the power of millions of developers who thrive in their ecosystem, without demanding employer-like control over them. This is a philosophical paradigm shift where ‘control’ is not the bedrock of management.
As Gen Stanley McChrystal points out in his book “Team of Teams” — operating in a VUCA environment with a diverse team, requires a leadership style that focuses on creating the right environment, rather than giving the right plans.
For example, think how a gardener tends her orchard. She realizes that her primary task is to focus on the fertility of the soil, availability of nutrients, ensuring adequate space between different kinds of saplings. She recognizes the growth pattern of each species and arranges to plant them so that each sapling gets sufficient sunlight and one plant’s growth does not overshadow another. She also knows that her crucial task is to remove the pests and insects which can damage the plants. Most importantly she knows that each plant will grow at its own pace and while she can experiment with grafting different plants to bring out hybrid vigor, there is no point in shouting at a plant or comparing growth rates between different species.
A gardener leader knows each plant will grow at its own pace and her primary task is to create the right environment for it. This model is bewildering for “authoritative” or “coaching” leaders who try to enforce vibrancy by copying the best practices of gardener-led companies without practicing gardener leadership. That’s a bit like sticking mission statement posters in a garden, urging the plants to grow faster. The plants don’t care about posters.
Leaders will have to learn to lead without authority. While this is not a new concept per se, most paradigm shifts are recognized and parroted, but not acted upon for decades, especially by older organizations, at times leading to their demise. Traditional organizations are dominated by authoritative and coach leaders who manage using materialistic frameworks based on the carrot and stick. But disrupters achieve agility by creating opportunities of personal happiness. They attain competitive advantage by offering noble causes and social happiness in work environments.
Learning to lead without authority is difficult, especially for those leaders who have led with authority all their life. But there is no choice now. The workforce of the future cannot be led by authority. Most leaders in their 40’s to 50’s will agree that their children are averse to authority and respond much better to environmental incentives. Especially when it comes to performance, millennials have different motivation paradigms than previous generations. So the first step towards leading without authority is to realize that most of the future workforce is exactly like our own children. When they wouldn’t accept dictatorial authority from their own parent’s, why would they accept that from their bosses?