As we come out of an unprecedented year, the world's business leaders must take advantage of the opportunity to change the world of business for the better. Even before the pandemic, we saw low levels of engagement, purpose, passion for work, productivity and performance. There were even toxic workplaces where, for example, in the case of a French telecoms company, leaders were sued because they created a deliberate culture of fear that led to 19 suicides.
We need a big shift in organisations and at all levels of the society – we need a new renaissance. A renaissance of humanism, with social and economic justice, where we have the right and responsibility to build more humane workplaces and society through ethics based on human values. So how do we do that?
At an individual level, we need to move away from fear and a mindset of scarcity and adopt a focus on unity, connection, collaboration and compassion. At the corporate level, the shift is needed to create a high-performing, happier, healthier and more purposeful workplace that can navigate the pandemic and thrive in a post-Covid world.
The world has shifted – this is a new game now that requires a new approach to management and leadership. We need radical, new, humane leaders and managers to move away from hierarchical command and control, micromanagement and toxic organisational cultures where people are treated as cogs in the machine or numbers on a spreadsheet. We need to invert the pyramids with one leader at the top, some managers underneath and then everybody else. This perpetuates lower levels of mindset and organisational cultures. We need to move towards a leadership based on trust, transparency, meritocracy, purpose and compassion – making a difference for all stakeholders and the world as culture resides in the hearts and minds of people, not within the walls of office buildings.
With our thoughts, emotions and behaviours, we all create ripples. Leaders create the biggest ripples and can play a critical role in creating new, more humane organisations that will speed up the recovery. For a long time, the dominant leadership approach has been based around the pursuit of short-term financial targets and cost control, with powerful chief executives deploying human resources as they seek to maximise returns. Concerns for welfare, or for society, were assumed to be an optional extra, with leaders supposed to choose between profits and conscience.
There is a lot of evidence from my and others’ research that this approach is seriously flawed – from both business and social and environmental perspectives. It is interesting that, as a result of the global pandemic, business leaders are now challenging this paradigm; it is not just a few gurus and academics.
We have seen polarised responses to the Covid crisis from leaders. From those where staff welfare was made a priority, to those who started cutting jobs and costs, while maximising government support.
Smart leaders know that to look after staff in a crisis is to create a powerful asset for recovery. They understand the importance of emotional as well as economic recovery and that the two are intimately linked. Team members who were supported by their leaders through a period of insecurity and fear will redouble their efforts once recovery begins. This is the essence of humane leadership.
Most leaders do not realise the extent of impact they have on individuals, entire organisations and the wider society. To make the world of business better this year and in the years to come, the following five new year resolutions would help leaders to achieve that ambition:
- Move away from a controlling mindset to an empowering one with a caring organisational culture.
- Refrain from setting strict rules and work towards establishing principles and purpose to guide decisions and actions.
- Replace excessive time spent on issuing instructions with time spent on creating collaborative teams.
- Instead of focusing on overseeing transactions, spend time and effort on building alliances.
- Instead of maximising profits in the short term, focus on serving all stakeholders.
This monumental shift in the business model and leadership approach may be daunting, but it is also tremendously exciting. No longer do we have to choose between purpose and profit. Organisations can do well and do good, but this largely depends on leaders’ mindset and actions. It is time to choose them wisely.
Vlatka Hlupic is professor of leadership and organisational transformation at Hult Ashridge Executive Education, and CEO of The Management Shift Consulting