6 Leadership Practices for Successfully Embracing and Harnessing Uncertainty
Key Takeaways:
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By embracing uncertainty, leaders become energized and agile, reclaiming their power and serving as an example for colleagues and peers.
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Harnessing uncertainty includes: taming apprehensions, envisioning the future, regulating expectations, experimenting nimbly, guiding choices, and collaborating frequently.
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Being able to move confidently through uncertainty and responding to ambiguity with adaptability will always be a winning skill since our world is constantly changing.
6 Leadership Practices for Successfully Embracing and Harnessing Uncertainty
Harnessing means capturing energy (harness wind and solar energy or harness personal energy), protecting oneself for safety (wearing a harness in dangerous settings), focusing attention (using harnesses to control animals), and driving change (harness racing). Harnessing uncertainty means turning the threat of not knowing the future into an opportunity for greater success by becoming more energized, psychologically safe, focused, and agile. Leaders who are able to harness uncertainty are those whose teams and organizations excel when others falter. Leaders who help their teams and organizations prepare for and embrace change are those who are able to consistently meet customer, investor, and community expectations. Leaders who win.
Among the continuum and dimensions of changes, perceptions, and reactions, it has been possible to identify leadership tasks and key leadership behaviors. In this section, the authors connect the tasks with behaviors and provide examples of leaders who have demonstrated these behaviors in times of great uncertainty:
One would be pardoned for responding to this list with the comment that none of these behaviors is unique to leading in times of great uncertainty. Good leaders must always be able to envision the future, guide choices, tame apprehension, etc. However, the particulars of what these behaviors look like does shift in times of uncertainty. More importantly, they become not just one of many important leadership behaviors but instead are pre-requisites for success to a degree that is not the case under less ambiguous circumstances. In other words, weakness in these behaviors can be fatal to individual careers and organization viability during times of uncertainty.
While many of the examples used to illustrate these behaviors are taken from the context of the extreme disruptions of 2020, they are useful and relevant even during more routine times. Awareness and attention to these behaviors can not only be a “cure” for extreme uncertainty, they can be “preventative” during times of more routine changes. Deliberately cultivating and strengthening these behaviors as an individual leader and in leadership development efforts improves day-to-day performance, avoids unexpected disruptions, and builds leadership “muscle” that can be more readily accessed when larger disruptions emerge. As such, these six leadership tips for harnessing uncertainty are not only descriptive of what has happened, but prescriptive in terms of would leaders could do in future uncertain situations.
Step 1: Envision the Future
The concept of envisioning the future is not new but takes on added importance and complexity during times of extended disruption and uncertainty. When major disruptions hit suddenly (pandemics, wars, even sudden changes to historical trade agreements, etc.), things that used to be seen as unknown begin to appear as incremental changes. As early warning signals begin to unfold, exceptional leaders react with purposeful curiosity as the first step to harnessing the potential uncertainty. That purposeful curiosity includes three phases:
Phase One: Information gathering: Exceptional leaders reach out to experts of all sorts to begin to imagine what impact the event will have in the short-, medium, and long-term. They look for areas where there may be new opportunities at least as much as they focus on where there are risks or dangers to the business.
Phase Two: Scenario development: They sift and sort the expert opinions and use them to develop their own point-of-view about what the future could hold. They include internal and external stakeholders in the process, sharing and testing multiple scenarios for how events could play out and how each scenario will impact their organization as well as which scenario they see as most likely.
Phase Three: Direction setting: This last phase is critical and somewhat delicate. As probability moves to reality, leaders must put a stake in the ground. In the midst of so many unknowns, leaders know that even the most likely scenario will probably be off the mark. They must convey confidence in a given direction while maintaining humility about what they do not know. They must inspire urgent, purposeful action while acknowledging that they will likely have to shift the direction of that action even after the work is underway.
In essence, envisioning the future is a leadership practice focused on addressing and molding the team’s perceptions of what a change could become or lead to.
Several examples from the current pandemic stand out:
Khaldoon al-Mubarak, Managing Director and Group CEO of Mubadala, a $230B sovereign wealth fund for Abu Dhabi, spent mornings on the phone with Asia, afternoons with Europe, and evenings with North America. He tapped experts in business, investment, and health leaders around the world before concluding that the world had the resources to beat the pandemic and that it offered huge opportunity to diversify his country’s resources away from oil. Instead of minimizing risk by reducing investments in 2020 as many other sovereign wealth firms did during this period, his willingness to embrace risk has allowed the fund to diversify faster than during a standard economy (Jones & Gottfried, 2020).
Facing huge demand and public pressure to increase production, leaders of paper product manufacturers went through a similar process in March. As they evaluated actual usage (v. demand), potential additional capacity, costs of warehousing extra product, and health risks to their workforce, most increased production only modestly if at all (Corkery & Maheshwari, 2020). In this case, there was no need for a change to current production, no opportunities to be gained by increasing it, only higher costs that would erode profits not offer new growth opportunities (Lemieux, April 13, 2020). Looking into the future for paper production revealed that while there may be shifts in where toilet paper was consumed, resisting pressure to increase production was the scenario that would best maintain profitability.
Step 2: Guide Choices
The most-likely scenario developed as a leader envisions the future becomes the public foundation for guiding choices moving forward. Leaders must translate the scenario into clear short-term goals and help each individual identify how their work contributes to the achievement of that short-term goal. The leadership practice of guiding choices aims to influence the reactions of the team to (their perceptions of) a change, and to purposefully widening and qualifying the options. As the leaders focus their teams on the choices within their control and let go of the choices outside their control, employees feel empowered again to act.
At the same time, privately they hold open alternate scenarios and continue to reassess these scenarios. The intensity of the information gathering does not abate just because they have set a direction. They understand that the environment remains fluid and as they have access to additional information in the external world and as they see the results of actions, they have decided to take that different scenarios may emerge as more promising. As they hold these scenarios open and even continue to develop other scenarios, they guide choices in two critical ways. First, they make adjustments to the short-term goals based on new information. Second, they make decisions that keep as many promising future scenarios open as possible. This ability to tolerate ambiguity, continually reassess future scenarios, and guide the organization forward in a fluid, agile way ensures the best possible outcome.
Again, several examples from the current pandemic stand out:
Carol Tome’, who became CEO of UPS in the middle of the pandemic, has created focus and direction to guide choices. With surging volumes, critical safety concerns, and existing initiatives, she led the executive team through a process to focus on key priorities and become “Better not bigger.” As she explains “the leadership team is at the bottom of the pyramid because we bear the weight for the actions that we take and the decisions that we make. We bear that weight so that we can free up our associates who are at the top of the pyramid, so that they can take care of the customers. If you bear the weight, you can free up people to do the right thing, to give the best experience (Pressman, October 19, 2020).”
Another example comes from Nike, who had already been moving towards more direct-to-consumer digital sales but saw an opportunity in the pandemic to accelerate that move. The initial impact of the pandemic had a significant impact on sales and by mid-summer, retail sales had declined by almost 40%. At the same time, digital sales had grown by 75% and by July, CEO Jon Donahoe was doubling-down on a “Consumer Direct Offense (Thomas, July 22, 2020).” Layoffs announced at the time were connected not to the pandemic but to a stronger pivot towards an existing strategy (Arcieri, July 9, 2020). This clear direction, relatively early in the pandemic, helped guide choices throughout the company. Initiatives to grow digital sales were supported by a growing digital ecosystem that included apps (some offered for free during the pandemic), a creative #playinside #playfortheworld advertising campaign, and opportunities for regular people to interact with Nike sponsored athletes.
More broadly, leading CEOs in many industries without essential workers have actively worked to harness the uncertainty about where to work. When the virus first hit, companies around the world complied with government shutdowns but leading companies took a further step with clear guidance about who could work remotely and for how long. This clear messaging allowed employees to move forward with putting a specific disruptive event (working from home today/this week/this month) into a foreseeable pattern (working from home for six months) that provided stability and context for both work and personal decision-making. These same companies, and many others, used this short-term “experiment” to envision and test future patterns (how we might work in the future).
Step 3: Tame Apprehension
Individual purpose and contribution are just some of the needs employees need met in order to fully engage. Trusting relationships, feeling part of a team, and a stable predictable work experience are also important (Emmett et al., June 29, 2020). In normal times leaders need to inspire and connect with employees. In times of extreme uncertainty, the need for this is greater and the barriers are more numerous. The leadership practice of taming apprehensions is directed at managing the teams’ perception of the changes, and also potentially at the teams’ reactions. While leaders may need to tame their own apprehensions and at least make preliminary efforts to tame the immediate concerns of the workforce earlier in the process, the substantive work of taming apprehension can only be done once the initial direction through the crisis has been arrived at.
Leaders need to take two key actions to tame apprehension:
Listen and empathize: in order to tame apprehension, leaders must first understand it. Given a radical new world and/or a new direction that may have adverse impacts on employees or those they work with, what are their biggest concerns. In the current pandemic is it job security, health concerns, finding a space to work, adapting to new technology requirements, etc. Before a leader can tame apprehension, they must understand it.
Respond in a practical and positive way: Once leaders understand the concerns, they need to provide practical solutions and communicate them in a positive, hopeful way (while being realistic).
Several examples from the current world situation stand out. Marvin Ellison understands the concerns of front-line essential workers in a way that many CEOs don’t. As a former retail security guard who worked his way up through various retail chains, he has maintained a closeness to the needs of associates and customers. That empathy has translated into over $750,000,000 in special bonuses to front-line workers, additional paid sick leave for higher-risk associates, and free medical advice for any associate. Lowe’s is among hundreds of companies, large and small, who made significant adjustments to reduce fears for their workers. From covering all out-of-pocket medical expenses to reducing work expectations for employees caring for sick or out-of-school family members, from committing to no layoffs or pay cuts to removing limits on sick days, from installing makeshift protective barriers to limited retail hours, leaders around the globe listened and responded to a wide variety of fears to support employees, protect their health, and maintain engagement as much as possible (Gallucci & Seetharaman, April 13, 2020). Some companies, like American Airlines (transporting medical supplies, military mail, and packages instead of passengers) and Ford (producing ventilators, face shields, and disposable respirators instead of cars and trucks) (Rock, 2021). In Germany, McDonalds partnered with Aldi to temporarily “lease” employees so they could continue to work and receive salaries (Neerman, March 20, 2020).
Another example of listening and responding positively and realistically comes out of the United States’ Black Lives Matter movement, also in 2020. While many companies’ responses were seen as mere lip service, Levi’s Straus & Co.’s President and CEO, Chip Bergh, was one of a handful of leaders who listened, empathized, and then took meaningful, positive action. He spoke clearly and directly about the pain employees and customers experienced because of ongoing inequality, made substantive contributions to groups leading cultural change, and published (for the first time in the company’s 167-year history) Levi’s diversity statistics and a plan to fix them (Beheshti, June 18, 2020).
Step 4: Regulate Expectations
While taming apprehensions is critical to harnessing uncertainty, it must be paired with regulating expectations. There are hard realities of limited resources and unknown futures that cannot be wished away. Great leaders are clear about the limits of what they can influence, and they remind people of the truths they don’t want to acknowledge. They deliberately work to fight the instinctive desire others may have to opt only for the most realistic scenarios by sharing objective data for a range of scenarios. They remind people of the uncertainty of the future even while laying out a clear path forward and projecting optimism that collectively, the organization can transcend the challenges it is facing. As they share both the bad news and the good news in an open way, they generate trust with both internal and external stakeholders. The leadership practice of regulating expectations takes the facts of any changes into consideration and then moves its focus to how these changes are perceived. Taming apprehensions includes a leader’s ability to alter the perceptions of a change from a threat to an opportunity, and then to engage the team in ceasing this.
Several examples from the current pandemic stand out. At an individual level, managers everywhere are having to manage the expectations of their teams on a regular basis. One leader in hospitality looking to fill a role talks very candidly about the state of the business and the short-term prospects so that candidates come in with a clear understanding about what to expect while also sharing her passion for the company and the reasons she believes the company will survive and grow in the long run. Another leader in a consulting firm regularly shares revenue projections, updates on government subsidies, and the point at which layoffs will have to kick in while also highlighting the pivots the firm is making to adapt.
Managing expectations of external stakeholders is equally important. One firm that navigated that challenge well was Airbnb. Beginning the year by losing half the company’s market value is not the typical path to an IPO, but Airbnb just completed a highly successful IPO. Founder and CEO Brian Chesky’s has inspired trust by regulating expectations and being clear about the uncertainties ahead. His track record of overcoming obstacles as varied as accusations of racism, increased regulations, and safety concerns directly and transparently—including a personal apology to hosts this spring—contributed to their ability to successfully IPO. Most observers credit a combination of quick action and the ability to tell a compelling story to the investment community about how their recovery is different than others in the industry and how the pandemic actually accelerates their vision of a future where people “live anywhere.” (Griffith, December 10, 2020)
Step 5: Experiment Nimbly
Continuous reinvention is the key to any company’s long-term viability but during periods of extreme uncertainty, the ability to experiment nimbly—and sometimes radically—can be the key to survival. Extreme uncertainty, as in the current pandemic, can require changes to business models, service delivery, and work conditions. Additionally, it brought a myriad of changes to how we eat, shop, heal, celebrate, learn, mourn, worship, and socialize which offer both risks and opportunities for individuals and organizations. The leadership practice of experimenting nimbly focuses on managing, directing and motivating the team’s reactions to (perceptions of) changes. It must incorporate an understanding of the emotional reactions of the team, which may otherwise leave the team in a fight-flight-or-freeze-mode, to foster an environment in which experimentation is the norm and the making of errors are truly accepted as necessary for getting through the uncertainty.
Uncertain settings often give rise to incredible innovation of ideas and solutions as all of the sudden the risks of not experimenting so far outweigh the risks of experimentation. Great leaders are both predisposed to engage in experiments and know how to encourage and guide the experimentation of others. They encourage their teams to experiment by trying things they have not tried before. They encourage others to explore new ways to approach old (or new) problems. They celebrate what works and learn from what does not. They put existing resources to new uses.
The results of these experiments, along with additional data as the situation progresses, feeds back into scenario planning and direction setting, at times shifting the direction of the organization by degrees or pivots.
Several examples from the current pandemic stand out. The old adage “necessity is the mother of invention” certainly played out in the arts as performers around the world began radically experimenting with ways to deliver performances. What began in many cases as free concerts designed to maintain contact with their audiences or honor first responders evolved to a wide variety of virtual experiences: concerts, dance parties, lectures, livestreams, pay-per-view, virtual lessons, personal performances, etc. Late night comedy hosts engaged their families in producing their nightly shows. Artists changed media or posted works in online galleries. Movies went straight to Netflix. Museums produced virtual tours. Groups gathered on Zoom to practice and perform together. But the arts lived on and were important sources of solace to many.
In India, with the world’s second largest population, the government’s Department of Telecom reached out to the telecom operators for support in getting the message out. In early March, with less than 50 confirmed cases in India, the government asked telecom operators to play a 30-second message on how to stop the spread of the virus instead of the normal ringtone. As the pandemic unfolded, the message was updated and proved a simple and powerful way to disseminate health information in a country where even the country’s 26% illiterate population mostly have a phone in their pocket (Pandey, June 16, 2020).
Key to any experimentation is the learning that follows. In Taiwan, the government led by President Tsai Ing-wen is widely seen as leading one of the best government responses globally. A number of factors play into that response, but key among them is lessons learned during the SARS outbreak in 2003. The learnings from having experienced a similar pandemic resulted in early and aggressive monitoring of the outbreak in nearby Wuhan, followed by aggressive contract tracing and isolation that contained the virus that helped the country avoid the large-scale lockdowns that so many other nations experienced. It also anticipated other disruptions, monitoring commodity demand and ensuring adequate availability of medical grade masks. These actions resulted in Taiwan being the only country in the world to post positive economic growth in 2020 (Everington, December 4, 2020).
Step 6: Collaborate Frequently
In a radically new situation, the more partners you have, the more information and alternatives you can explore. Exceptional leaders have broad and deep networks that they use regularly. In times of radical uncertainty, they rely more heavily on those networks to learn and adapt. They learn from and with others by testing ideas, coming together to solve shared problems, and share learnings. They invite their advice and their ideas. They are open to joint solutions. The leadership practice of frequent collaboration addresses the reactions of the team to (perceptions of) changes, and insists on keeping fearful emotional reactions at bay, and engage actively and constructively in - even unproven and potentially frightening - new ways of working together with internal and external stakeholders.
Several examples from the current pandemic stand out:
For hospitality, Covid-19 has been devastating. Given the sudden and complete impact on travel as the world shut down in early 2020, Hyatt executives had to take immediate action to ensure liquidity. Furloughs bought time for a strategic approach to widespread staffing cuts. At the same time, they began preparing for ways to restore confidence and safety for both the workforce and guests. Conversations with medical, other travel industry leaders, and even architects about how to safely resume operations allowed hotels to gradually reopen in various parts of the world.
They helped leaders in these adjacent industries learn from each other’s experiments and prepare for emerging developments like rapid tests, air travel bubbles, and plan together to safely resume conferences and other travel as soon as possible.
Perhaps the most highly touted collaboration of the current pandemic has been in medical care as doctors and scientists around the world came together in unprecedented ways to speed up vaccine development and share learnings about treatments as quickly and broadly as possible. From large pharmaceuticals partnering with start-ups and governments to speed up vaccine development to doctors sharing lessons learned on blogs and informal networks to virtual reality videos demonstrating coronavirus treatments, the global medical and scientific community has collaborated in unprecedented ways to try and “flatten the curve.”
Change is - and probably always has been - an inevitable part of the human experience. And we may be increasingly aware of the fact that this is so. Our contexts, including those in which we operate as leaders, are increasingly difficult to predict, as are the consequences for ourselves, our teams and our organizations.
As leaders develop the skills that allow them to envision the future, guide choices, tame apprehension, regulate expectations, experiment nimbly, and collaborate frequently, they will be able to channel the pressures of change to create positive outcomes for their teams and organizations. Even more importantly, organizations who are able to create routines and processes that encourage, develop, and enable these behaviors in their leaders will lead out in meeting evolving customer needs and shareholder expectations.
This article is an excerpt originally from a chapter in Role of Leadership in Facilitating Healing and Renewal in Times of Organizational Trauma and Change (Advances in Human Resources Management and Organizational Development) published by IGI Global and compiled by Lynda Byrd-Poller (Author, Editor), Jennifer L. Farmer (Editor), Valerie Ford (Editor).
REFERENCES
Arcieri, K. (2020). Nike levels up digital game in wake of coronavirus hit.
Corkery, M., & Maheshwari, S. (2020). Is There Really a Toilet Paper Shortage? New York Times.
Everington, K. (2020). Taiwan president ranked in Bloomberg 50 for crushing Covid. Taiwan News.
Jones, R., & Gottfried, M. (2020). Abu Dhabi’s $230 Billion Man Bet the World Would Overcome Covid-19. The Wall Street Journal.
Lemieux, P. (2020). Toilet Paper: Increasing Marginal Cost. The Library of Economics and Liberty.
Neerman, P. (2020). Aldi to employ redundant McDonald’s staff. Food.
Pandey, G. (2020). Covid-19: The woman who has become India’s ‘corona voice. BBC News.
Pressman, A. (2020). The holidays used to be UPS’s busiest time. Then came COVID-19.
