General George W. Casey, who served as Chief of Staff of the US Army efforts in Iraq, told a recent Gordon Institute of Business Science (GIBS) forum that the current unpredictable global political and economic climate requires leaders of vision, courage and character.
"We need leaders with vision, who are able to point the way ahead, see around corners and anticipate things that others don't and have the courage to take decisions for the future," Casey said.
Leadership in a VUCA world
Casey addressed the gathering on strategy and leadership in a Volatile, Uncertain, Complex and Ambiguous (VUCA) global system. The term was coined by the US Army War College in the late 1980s to describe a post-Soviet Union world. He said volatility and complexity is now common to both business and the military.
Drawing on leadership lessons learnt during his time in Iraq, he explained that while VUCA circumstances impede a leader's ability to understand, communicate and act decisively, how leaders react to these situations differs vastly.
While some leaders make the assumption that as circumstances will change, any attempt at planning is futile. Others are so overwhelmed by the volatility, complexity and uncertainty they face that they are unable to act at all. A third, and much smaller group, are able to impose their will on the environment by "building a deep understanding of their situation and crafting a strategy for success."
Casey called this the VUCA Paradox: In order to be successful, leaders have to accept that their environment is going to be volatile, complex and ambiguous, but not allow external factors to determine their ultimate success.
He identified three potential scenarios for increased global volatility:
- A significant cyber-attack on a country's financial system, which he said was "only a matter of time."
- Another global economic crisis: "We are now so connected and haven't resolved many of the issues from the previous financial crisis"; and
- A major terrorist attack with a chemical, biological or radiological weapon of mass destruction.
Casey, who undertook a major reform of the US Army during his tenure, said the United States and Europe are currently in an era of persistent conflict with groups who have global capability to inflict strategic damage on states. "There is no better innovation driver than war as people are focused," he said.
Traits of effective leaders
Effective leaders are those who are able to develop a comprehensive understanding of their external operating environment, devise a clear vision and strategy for success, and then develop the organisation to execute it. Taking the time to build consensus and commitment within the organisation is as important as devising an effective strategy. "The essence of winning people over is the commitment to a common goal and to executing a strategy," he explained.
The distinctive behavior of leaders is what makes companies successful and outperform their industry peers: "We have to be able to trust leaders to do the right thing in difficult circumstances. It is the glue that holds the entire organisation together," he said. Building an environment where everyone feels that they are an integral part of the team means group commitment to a common goal and setting aside personal ambitions on order to commit to excellence. "While leaders have to be courageous enough to make decisions on their own, support from the organisation is crucial to success," Casey said.
Successful leaders are those who take care of themselves - intellectually, physically and emotionally: "As a leader the weight of the world is on your shoulders. You have to be emotionally, intellectually and physically fit in order to be effective," Casey explained. He said leaders must make time on a daily basis to read, exercise, sleep and think in order to get fresh ideas and insights.
Lessons for business from the military
Casey said while the military is not nearly as efficient as business when it comes to cost controls, business lacks a true understanding of strategy and vision, and the ability to decide exactly what needs to be accomplished.
Business should improve its efforts to invest in people's professional development in order to gain their loyalty, Casey said. "People want feedback and they want to be inspired, which is not unreasonable."