Volatility. Uncertainty. Complexity. Ambiguity. These are four words that in English together are usually abbreviated to VUCA. And that sums up what many of us have experienced in the last three or so years. With the pandemic, broken logistics chains, new security policy situation after Russia's full-scale invasion of Ukraine and a different economic situation with higher inflation and interest rates.

Preparing for a crisis

Now we are all doing our best to navigate this changing world. But how can you as a leader prepare for the next crisis or strengthen yourself to deal with unpredictability. Because we need to count on things that can change. Again. Substantial. Fast. And it can start from far away. It could be political turmoil, a natural disaster or a reputation on social media. Or the cause is a tiny virus that spreads with enormous speed across our planet. Or something completely different.

Such premises require a certain approach on the part of leaders. It requires versatile leadership.

Being a dynamic leader in a VUCA world

A new study points out that it is about the ability to be dynamic, versatile and flexible. That is, leaders who understand when to accelerate or brake. Who understands when to step forward or back down. Who understands when to go down in detail or raise the gaze.

The new findings come from renowned American leadership experts Rob Kaiser and Ryne Sherman. And strengthens the image that effective leadership in a so-called VUCA world is to a large extent about being able to shift gears and not just continue in the usual ruts.

Instead, it is important to be able to adapt to the situation, the environment, the conditions, the assignment and the long-term goal. Much like driving a car - you can't drive straight ahead while keeping the accelerator fully pressed down. It is perhaps especially important for middle managers and decision-makers at the company management level.

Acting dynamically is of course easier said than done. The positive thing is that most people can develop their ability to relate in a versatile and flexible manner.

Well-developed self-awareness is essential

To succeed in this, the key is to acquire a good level of self-awareness.

Leaders with developed self-awareness have a nuanced view of their strengths and weaknesses. It's leaders who know what drives them and how they affect those around them, for better or for worse. Leaders with good self-awareness know how they are, for the most part, perceived by others.

With a developed sense of self-awareness, it is much easier to adapt one's way of behaving as a leader to help one's team and organisation. It becomes easier to know how to drive a car.

In addition to developing self-awareness, leaders should consciously step out of their comfort zone to become more versatile, e.g. by testing new contexts or tasks, striving to acquire different experiences and practising adapting their behaviour. A bit like practising driving different vehicles in different environments and under different conditions, if we are to continue with the car analogy.

How should one act in the event of a rapidly flaring crisis?

Developing your versatility over time will make you better at handling dynamics. But how should you act in the event of a rapidly flaring crisis or if you are faced with a completely new situation that shakes up existence?

Here are four pieces of advice from one of the world's leading leadership researchers, Amy Edmondson at Harvard Business School:

• Communicate transparently and communicate often.
  Don't pretend you know when it's obvious the situation is brand new to you too. Instead, show humility and admit you don't have all the answers. It creates security and builds trust.
• Act with urgency.
  Make decisions, even if you lack information and don't have a clear picture. It's natural to want more information; acting fast is sometimes the only way to get more information. Abstaining from decisions or lack of action can instead lead to increased insecurity and uncertainty among e.g. coworkers.
• Stick to values ​​and purpose, even when goals and situations change.
  Namely, they can act as beacons when everything else is rocking. Navigate your organisation's core values ​​when making decisions. And be open about what values ​​you act according to.
• Let go of power.
  Involve others, increase participation and let others have influence. It requires you to ask for help and be clear that you cannot handle the situation completely on your own.

More tips for leading effectively in a crisis

The Swedish crisis management expert Mats Bohman is on a similar track. When he previously participated in a webinar on crisis management arranged by us at Michaël Berglund, Mats talked about, among other things, the importance of trying to create a picture of the situation, to the best of your ability as much as possible. And to dare to make decisions even when a lot of information is missing.

Mats Bohman also gave other recommendations to leaders who need to deal with a crisis:

• Plan for several possible scenarios (e.g. three variants: a 'worst case scenario', a 'realistic best case scenario', a 'most likely scenario').
• Set goals for both handling and communication. Communicate these with employees to create action in the organisation.
• Create a log where you can continuously follow the most important factors, e.g. sales, liquidity, goods flow, personnel, and customer availability. Also, log which decisions are made and which measures are taken. Make assumptions based on the development, and log these assumptions. This way you get a clearer picture of the situation. Save the log.
• Continuously evaluate the situation, and take action accordingly.
• Get help if needed.

Patrik Peter

Managing Director Leadership Acceleration, Partner

Michaël Berglund