The LEWIS Advisory Board (or LAB) has consulted with many global leaders from all walks of life since its foundation. This book aggregates and paraphrases their feedback on how the world is changing and how leadership, in all its forms, is evolving.
In the past 25 years, the world’s leadership culture has shifted on its axis. It used to be an overwhelmingly male, heterosexual, patient, predictable, factual, planned, white, long-term, Western-orientated, technology-leveraged, deflationary, structured, left-brained rational, broadcast, top-down, militarily symmetric world.
Now, leadership is operating in an inverted, unreal, amoral, impatient, inflationary, selfish, spiritual, irrational, gender-fluid, polysexual, asymmetric, strategically multipolar, everywhere-facing, bottom-up, information-soaked, multi-racial, androgynous, fluid, opinionated, rapidly moving, asymmetric world.
The rapid change has exposed real leadership failure. Since the turn of the century, we have learnt that around the world, our corporate leaders have illegally avoided taxes,1 lied about emissions in the car industry,2 rigged interest rates,3 sheltered customers from taxes,4 laundered Mexican drug money,5 presided over an offshore banking system that was larger than anyone ever thought,6 forced good companies into closure7 and destroyed pension funds as they themselves grew wealthier.8 Collectively, they oversaw unprecedented destruction of wealth and the collapse of the financial system,9 and watched as life savings placed into investment funds set up by leaders of unimpeachable integrity turned out to be Ponzi schemes.10 Our spiritual leaders have covered up sex abuse in the Church.11 Our charity leaders have sexually abused the vulnerable.12 Our child welfare leaders have permitted child abuse.13 Our political leaders have allowed an epidemic of gun crime.14 They have cheated on their expenses,15 admitted sexually inappropriate behaviour,16 started ruinously expensive unpopular wars17 on the basis of false information18 and were taken completely by surprise by the Brexit vote.19 Our education leaders have presided over exam cheating20 and sexual harassment.21 Our defence industry leaders have settled claims relating to the bribery of government officials.22 Our leaders of public utilities have poisoned customers.23 Our entertainment leaders are facing multiple allegations of sexual harassment and abuse.24 Our leading broadcasters have falsely accused political figures of being child abusers,25 while allowing actual abusers to commit crimes on their premises.26 Meanwhile, our sporting leaders have been caught cheating and doping.27 Our medical leaders have chronically mistreated patients.28 Our human rights lawyers have been struck off for misconduct and dishonesty,29 while our military leaders have admitted using torture30 and our service personnel have died through their negligence.31
These events sound unlikely, unbelievable, even impossible, but they all happened. Outside of the cataclysmic events of the world wars, it is difficult to remember a time when leadership has appeared more thoroughly and completely discredited. If you are starting to feel as if this is a knife to the throat, then you might like this book. It is not anti-leadership. Quite the contrary. It is against bad leadership. It’s not interested in blame or retribution. It searches for the truth.
What do these events have in common? Did they lack professionally qualified university-educated leaders? If not, why didn’t they notice what was happening? Were they distracted by too much or too little information? Did they know they were doing wrong? Did they lack the imagination to see the effects of this? Did they feel they couldn’t speak out? Did they think they would just get away with it? Did their size play a part? Did it matter that they were led mainly by middle-aged men? What role did technology play? Finally, is there a pattern here? We know good leaders, great leaders, are out there. Leaders with integrity, courage, wisdom. Inclusive leaders. Leaders who change the lives of the many. Leaders who think. Thinking is an underrated activity. So, we need to find the best modern leaders by studying the worst. By studying failure. So, in summary, this book:
In our daily work over the past 20 years, we the authors have witnessed a growing confusion in the leadership forums of the world. This is true whether they be boardrooms, governing councils, committees or government cabinets. A failure to understand the polarities caused by technological change has resulted in a toxic brew of conflict. This is creating an almost revolutionary atmosphere that threatens to overwhelm leaders. Leadership frequently appears to be in crisis as a seemingly endless sequence of revelations undermines respect for leaders.
There has thus never been a greater need for leadership to evolve. This book asserts that there is an imbalance in leadership thinking. It is too steeped in Western Reductionist thinking.
In the context of The Leadership Lab, we define Western Reductionist thinking as the tendency to apply narrow logic, data, key performance indicators (KPIs) and quantitative thinking. There are reasons for this, such as the constant overload of data, the interruptions, causing rising impatience and ever-greater leadership expectations.
The rationalism of Western Reductionism has been a great servant for scientific progress. The ability to compare, contrast and analyse has often been associated with so-called left-brain thinking. It allows us to drill down into data, which, by its very nature, is historic. This tends to be more short-term, quantitative and tactical. It also tends to be more often associated with a ‘masculine’ way of thinking.
There’s nothing wrong with this of itself, except that it’s not enough. It can miss the insights that come from parenthetic or more inclusive so-called right-brain thinking. This focuses on the irrational – belief, faith or trust. It encompasses more long-term strategic values such as community, spirit and purpose. It encompasses looking forward and using imagination rather than facts.
Scientists have, of course, shown that the left and the right sides of the brain are not the exclusive provenance of these processes. They work in tandem more than previously thought. Similarly, a masculine way of thinking and a feminine way of thinking are complementary and perhaps overlap. What is clear is that using only one part of the brain or one type of thinking leads to less than optimal results.
There is a powerful movement to balance gender in leadership and we applaud it, but only as a first step. What is the point, however, of having equal representation if all genders are encouraged to think in the same drill-down analytical way? We should be looking for balance. A parenthetical complements the deep-dive view. Leadership should be capable of all types of thinking, regardless of its gender.
The pressure on leaders to perform commercially and operationally has never been greater. They are held to higher expectations and subject to almost permanent comment through social media. Their organizations have never been more transparent. Almost every aspect of their personal and professional lives is visible.
On top of this, their vision is often obscured by either too much or too little information. Consequently, we’ve seen them blindsided by events, where drill-down data research has strongly indicated one outcome only for another to happen.
One reason this happens is because behaviour is not always logical. We also follow values. It’s no use, for instance, arguing that Brexit will force the rest of Europe to reform in the British style. That might be logical to some, but the values of Europe encompass more than just logic. Continental Europeans were far more affected by the catastrophe of war and are more motivated to seek unity and commonality.
We suggest that too many leaders don’t get out and talk to people enough. Leaders travel constantly and easily, but going somewhere is not the same as truly understanding it. People can’t easily follow someone who lacks a broad-based understanding. What’s required is something the military calls situational awareness or fluency. In other words, they need to understand that how people feel is also what is actually happening. It doesn’t just depend on data. Real leadership combines both logic and emotion, both short- and long-term thinking.
Leaders often struggle to knit these capabilities together. Their background usually is degree educated – steeped in the Western Reductionist tradition. This does not recognize softer skills as important in reaching their full potential. This also means they cannot draw out the potential in others either. If a leader wants success, it requires the building of trust that entices others to follow. Currently, only 18 per cent of people believe business leaders are truthful.32
Change happens whether people are aware of it or not. Taken individually, the changes we’ve seen since the turn of the century would be a challenge for leadership. When taken all together, it is bewildering. It’s becoming hard for leaders to make sense of what appears to be an increasingly disorderly world. This is particularly the case with their current skills of logic, analysis and comparison. There is, however, a clear pattern to change and we can no longer lead by analysing the dots separately; we must learn to join them up.
One of the tasks that humans will always be better at than computers is imagination. We can blend temperature, sound, emotions and aromas to interpret atmosphere. We can link behaviours and situations to create understanding. We can dream. We can empathize. We have curiosity.
Leadership has become increasingly ‘professionalized’ and classically educated, with more formal qualifications, academically and technically. Of course, this helps, but we must guard against a belief that this type of education is all that is needed. Leaders may be unnecessarily excluding those who come from different educational backgrounds. Education is changing fast, too.
All leadership improvement, especially post qualification, starts with the humility to admit ignorance. This is a powerful indicator of real leadership. Curiosity matters; in fact, it’s a key leadership resource. Asking questions such as: ‘Why did that happen?’, ‘Why do we do it that way?’ and ‘What if we did it a different way?’ is not a sign of weakness.
On the contrary, the ignorance of potential failure through overconfidence has led directly to the collapse of many organizations. We will explore this in detail in Chapter 7. Failure is always the parent to success. How many tasks or skills have we all tried and failed? Toddlers taking their first few steps before falling may get up again by instinct, but later failure is overcome by determination, encouragement, even a sense of fun. Success owes more to determination and attitude than to skill alone.
This is not a call for soft, woolly thinking. Drilling down into quantitative detail is part of where the answer lies. The reverse is also true. Joining the dots is hard. It requires going against familiar analytical processes. There is, however, little point to arriving at the top of the mountain if all you can see is the detail of the square foot of ground under your feet. The view is the whole point. Leaders need this to show the vision and not just give direction. This can only be achieved if all faculties are devoted to the task, for instance analytical thinking, yes, but imagination, curiosity and emotion as well.
Our own methods, prejudices and biases determine our view of the landscape and our view of others. The solution is a different way of thinking that includes more of the insights available to us in the 21st century. You might be an expert in any field of endeavour, but this is a profundity, not a parenthesis. What do we mean by this? The Western Reductionist model becomes more and more efficient until it reaches its ultimate incarnation – the algorithm. This serves only the most relevant information based on what you have already consumed. This means that our knowledge becomes deepened and exaggerated. At face value, this appears to be a great strength, but the opposite is true. By excluding all but the most obviously relevant information we exclude the ostensibly irrelevant. It is this that is most often the source of leadership vulnerability – the thing that no-one sees coming, because no-one imagined it.
The causes of leadership failure are usually the issues no-one planned for, because no-one foresaw them. No-one thought the systemic failure of the entire banking system was possible, for instance. In November 2008, HM The Queen asked some British economists why it had happened. Six months later they provided a three-page document, signed by some of the country’s top thinkers, blaming ‘a failure of the collective imagination of many bright people’.33 They just didn’t see it coming and they failed to imagine it was possible. How many leaders are at risk of a similar situation today?
The leader is responsible for the thinking culture of the entire organization. In this way, they can liberate the latent human talent and engender the trust that is essential for success. This is especially important because the 21st century poses complex and multi-dimensional problems. It demands creativity and imagination, but this can’t thrive if we don’t respect its origins or pre-conditions.
Why do leaders leave aside so many useful techniques? The short-term values of efficiency and performance are highly prized. It’s impossible to get these without long-term qualities such as passion, joy, forgiveness, empathy, courage (above all), compassion, belief and humour. These are long-term goals that never seem to be credibly addressed. This is the hallmark of Western Reductionist thinking. The quantitative is revered while the qualitative is belittled because it can’t be measured. Our job is to show leaders how and why they should engage in this inclusive thinking – to access all the tools, people and forces at their disposal.
By doing this, they will learn how to knit together both the left and right processes of the brain and marry the quantitative to the qualitative and the short- to the long-term. They should develop binocular vision: instead of a quantitative, mathematical lens, they should open the other eye to the qualitative evidence as well. Yes, we want the microscope that drills down into data but we also need a telescope that gives a view of the landscape and even of the stars.
We need to cast our view internally as well as externally. Achieving true awareness of the situation involves us looking at our own motives for action. Are we leading teams with our values? What are our values? Does it matter that we behave morally? This is not to exclude quantitative analysis, but we believe we can create a more emulsive approach where the dynamism of leadership combines the oil and water of logic and emotion. The purpose is permanent learning, not snapshot by snapshot.
Leaders need to check their vectors. Is the organization excessively ‘male’ and patriarchal in its thinking? It’s not just women who think feminism is a good idea. You might prefer hard thinking, muscular ideas, rigid targets, cold calculations, but what room does this leave for values that drive others – passion, joy and love? This is not just about having women on leadership boards, especially if they only replicate masculine thinking. Ask yourself what range of subjects your leadership board could discuss. Numbers? Research? What would happen if you wanted to discuss passion and purpose? Would you be shown the door? Can’t compassion and care be a corporate value, too? Or does that need to be coldly referred to as corporate social responsibility (CSR)? When we refer to people as human resources (HR) or corporate responsibility (CR), a little piece of the personal and human element disappears.
Harnessing potential also requires an understanding that all competence follows preference – people get good at what they like doing. This means that the process in business is supposed to be fun. Is your leadership fun? Is it fun following you?
This is not inconsistent with vaulting ambition and growth. We must be careful to ensure that the traditional ‘Alpha male’ approach creates the actuality of speed and progress, rather than just the mere illusion of it. Bigger does not create better, but better can create bigger. We have seen countless incidences of leaders travelling so fast they can taste nothing and where everything is measured by size, volume, scale: how many clicks, sales, news stories, shareholders. It leads to recklessness.
Top-down, Alpha-male leadership often asks the wrong question and gets the wrong answer. It’s important, however, to allow bottom-up access to the success. This is not just in monetary terms. Everyone wants to share success and to own it. Part of the reason is that we confuse confidence with competence. We revere and reward the overconfident and dismiss those who carefully double check everything. Leaders need to ask: Is someone who double checks things in your organization an asset or a neurotic?
We must also have a process for adapting to change. If there is no evolution, then the stage is set for revolution. With a process, change can be an ally. Without it, change creates ‘events’ that drain time and trust. Events then become like architecture. First we shape them, then they shape us. Leaders shape events and then are subsequently shaped by them.
What we’re talking about here is intellectual and emotional suppleness. We should be able to switch between the two. It’s a quality that young people have in abundance. They ask: What is the purpose of this organization or community? What is its story? Profitability is not enough. An organization’s success may be measured in how influential, trusted and followed it is and whether it serves a relevant purpose. Leaders must understand the values their teams follow. They have to follow the followers.
This is as true in politics as in other areas of leadership. As a leader, what is your purpose? Leadership is nothing if not a moral crusade. Good leaders must have spiritual virtues – not just commercial, not just technical, not just transactional. This speaks to the Harvard Business School definition of business – ‘the management of social relationships for profit where profit may be financial’. It’s about social relationships.
All leaders say they want more intelligent people, but how many recognize the different types of intelligence?34 The more skills or experiences leaders have, the greater the level of connection they will display to their team.
We also need to ask: What’s the price of a mistake under your leadership? Victory and defeat are just learning signs. They’re not the ‘be all and end all’. If failure is not acceptable, how do we spur imagination and vision?
Our goals here are to replace the analytically, economically efficient with a more balanced approach. We aim to point out that capital excess with a deficit of purpose will ultimately lead to failure. This book is a gesticulating arm that points to the hidden inefficiencies and growing disillusionment with leadership. We’ve been shaken to our foundations over the past decade: the financial crisis, Brexit, numerous terrorist events and the results of the 2016 US presidential election. The landscape today is different from what many expected and predicted. So, how did the experts miss it every time? We think there is another way of seeing the landscape more clearly so we are not blindsided again.
Sometimes we see what looks like chaos, but what is chaos except a pattern we have yet to understand? Now is the time to ask, because a new world with new leaders is emerging. It will have different forces, different infrastructures, different centres, different priorities and different objectives. Now is the time to develop a better understanding of the world, to know what is actually happening instead of assuming we already know.
It is the moment to acquire situational fluency to see the facts in a wider perspective. Then we may have some hope of what is required for success in this new fluid environment. This is the ability to respond to, and anticipate, events because we are fluent with the global trends and drivers.
To help leaders achieve this greater fluency, we held a series of conversations throughout 2017 and 2018 called the LEWIS Advisory Board (LAB). The purpose of the LAB was to convey a sharper, more accurate image of reality, even if it is not what we’d like it to be. It was also to listen to successful leaders explain how they see the world and make business decisions. We held these meetings around the world. We were privileged to hear many opinions and witness great ingenuity and determination. While not all leaders agreed on every one of the points raised here, there was great consensus about the problems.
What we found were brave leaders prepared to throw themselves back into situations time and time again. They were often coping with extreme pressure and risk. Some had a narrow view of the world on some issues and yet were ahead of the curve on others. They could, for instance, still believe that ‘all the jobs are moving to China’ even as the Chinese begin to invest in manufacturing facilities in places such as the United States and Mexico. They can have extraordinary insight into the behaviour of their clients and broader customer trends, but be blindsided by more macro forces and trends. A macro view in itself isn’t very helpful for a CEO who is running a specific business with a narrow focus. The question is how to bring the two together in a way that will help others improve their ability to navigate the fast-changing global landscape.
This book therefore seeks to provide leaders with the additional insight and understanding that come from joining things up, for instance between the corporation and the rest of humanity. We wanted to review countries with a joint narrative rather than looking at them in isolation. We want to understand the future as a function of the past. We want the generations to understand each other better.
For this reason, we’ve taken soundings from many perspectives. We asked many leaders from both the LAB and others all over the world to help. We’ve sought views and opinions from politicians and business people on our changing world. We’ve talked to artists and admirals, to strategic consultants and scientists. We’ve spoken with politicians and entrepreneurs. These have been from all industries, nationalities, genders and age groups.
We’ve referenced these people at the back of the book, but the terms under which they were interviewed were ‘Chatham House’ so there have been no attributions. The idea was quite simple. What if we created a top-down, bottom-up snapshot of what was happening that would be diverse, wide-ranging and interesting? This would especially be geared towards leaders of all types so that they could build situational fluency with the technical, cultural, economic and geopolitical world in which they work. We also wanted to make the book accessible for lay people. Many of the changes occurring go much wider in society and affect all aspects of life and its many relationships.
An obstacle to writing a book with ambitious goals is what structure to use. So many of the problems we describe are interconnected and ‘join the dots’. Many of the changes also have paradoxical effects depending on who you are, what your situation is and where on the planet you are. These effects are sometimes good and bad at the same time. A physicist might say they were quantum super-positioned.
Should we organize the analysis by country, by trend, by problem or by leadership lesson? Our hypothesis is that our over-reliance on analytical, reductive thinking is part of the problem. This is because the changes we’re seeing are often paradoxical. So, we’ve tried to avoid an overly structured analysis. We are, after all, trying to show the bigger picture. Once we have this, the leadership response is obvious.
The LAB Kythera is our response to this challenge (Figure 0.1). It is a thinking tool that was inspired by the Greek Antikythera.35 This highly complex device was discovered on a shipwreck in the Peloponnese in 1900 and is now considered to be the very first computer in history. It was used to calculate the exact position of the stars, the moon and other celestial bodies. It is a calendar, a predictor of eclipses, a foreteller of moon phases. It even indicated the timing of Hellenic athletic games. It is remarkable because it was unimaginable that it could possibly date to somewhere between 205 BC and 87 BC. Astronomical clocks did not appear in Western Europe until the 14th century. Mechanical calculators like this did not arrive in Europe until the 16th century. The Kythera, therefore, captures the notion that unimaginable, and even impossible, things are indeed possible.