Saturday, August 29, 2009

7 Leadership Principles for 2010

As we get ready to emerge from the recession this time, we should learn from this near-death experience. If this recovery should sustain, which means that we shall not have an inflationary run, absurd interest rates and countries going bankrupt in the near future, the way we conduct ourselves must change. So far, it seems that we have learnt little, and waiting, like little boys, to return to life as usual.

The only way we can move forward is by accepting that there will be no return to life as usual. We must move forward, not back, and that includes not trying to replicate past templates. Bonus et al included, we should not wait around to banks get back to their old ways soon and start buying houses beyond our pay. We should save and not go back to our free-spending days. Businesses must focus on create value, and not just sustain themselves on easy credit or the naivety of investors. But, before anything else, we must acknowledge that we have this terrible habit not to learn, and must start changing ourselves at this time.

There is no hope that this is going to happen, without some inspired leadership. Leadership is a much abused word now. It passes off for positions unearned - like a CEO is a leader whoever he is. The underlying meritocratic assumption may not work. For many reasons, including that we are usually looking for wrong qualifications and because the world has changed. We must start with acknowledging that leadership is not what the leaders do, but it is what is expected of leaders. And, what is expected of the leaders is changing fast and thick, and in a sense, 2010 will usher us into a brave new world altogether.

So, what are those leadership principles for post-recession world? I tried to list out my thoughts here:

Principle 1: Optimism without Abundance

2010 will turn a new page in our history, where we must learn to live with scarcity. That actually is an understatement: We shall have to accept scarcity as a way of life. Our culture at this time is constructed around abundance, and we know scarcity as bad, abundance as good, in a rather straightforward way. The leaders tomorrow have to be optimistic and positive about an age without abundance and bring the faith back in the our human nature, which excels at the time of trouble. In Governance, Business and Education, the leaders have to show us the way to increase our resource efficiencies, cut waste and be happy without the opulence that marked our last few decades.

Principle 2: Leadership As A State of Mind

While we have got used to a fairly predictable world, and particularly accepted the idea about a stable end-of-history world since the end of Cold War, uncertainty will now be back with a vengeance. The political instability will rise. Inflation will be back, sovereign states will fail on their obligations. To survive, we shall need leadership as a state of mind instead of leader as an individual. The successful leaders will bring the leaders out from all of us and get us into a 24x7 leadership.

Principle 3: The Short Long Term

While the abundance allow us to focus on immediate term, the scarcity necessarily forces us to think long term - at least till the end of the tunnel. This will define the new ethos of leadership - thinking beyond the immediate term - and focusing on projects and ideas which did not seem to matter in short run.

Principle 4: Knowing the Limits of Cognition

We thought we knew best, but we don't. The recession was not just a market failure. It was a failure of the models and statistics and all the analytical tools, and a return to pure guts and people instincts. Our last century successes were mostly about overcoming our physical limitations by use of technology, and we have built a system of thinking supplementing our quest of physical ability. The recession showed us that we were not very good at handling our cognitive limitations though; we built systems that often fail and do not serve us well most of the time. The new leadership thinking will be focused upon questioning what we believe now and building abilities to overcome our cognitive limitations.

Principle 5: The Multi-local World

Globalization has taken a hit, though the international trade must keep its momentum and peace must prevail. The difference in this new world will be that we must acknowledge the diversity of the world and allow the local cultures, beliefs and customs to foster. No more of export of democracy, this means; rather accepting the fact that India and China will soon become two huge consumption markets and getting ready to know their ways.

Principle 6: The Citizen Leader

There is a low level of trust on leadership, after we have so badly let down. So, after 2009, it will be age of citizen leader rather than the celebrity leader. We shall trust those, who like Gandhi or Martin Luther King will walk and suffer, and less of those like Churchill and Kennedy who will charm and dazzle.

Principle 7: The Continuous Leadership

In this fractured, uncertain, scarcity-driven world, we shall need faith. And, that will make us want leaders who show us a complete way of living our life, not just discreet and often incomplete functions of getting rich or making cool staff. We shall need leaders as a model for our lives and we shall have fewer, but continuous and complete, leaders to provide that.

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