The 4th industrial revolution debate across Autonomous Leadership

I recently had a very interesting conversation with a PhD in behaviour science – we were actually debating the issues and positives across micromanagement, after he had read my blog, ‘Is micromanagement delusional or can it be effective’, whilst I wrote this blog back in 2015, there currently appears to be much discussion around leadership and the 4th industrial creation of autonomous leadership, some genius believes autonomous leadership is the answer to ineffective leadership.

I thought it was time to refresh my thinking and look into the negatives and positives, and why autonomous leadership should be deployed across business.

Most leaders want employees who take the initiative, get involved, make decisions and generate ideas. In fact, because your team is likely made up of educated, competent, seasoned employees (some of whom you may have hand-selected), it’s natural to expect that they would need a little direction to take the proverbial ball and run with it. You have a vested interest in their success because, when your team performs well, everyone wins.

Likewise, employees of all generations share a desire to work autonomously toward the communicated vision. No one wants to feel as if they’re operating under someone else’s thumb, especially team members who are smart, ambitious and motivated.

If autonomy is an essential ingredient for promoting employee engagement and motivation, and given that both leaders and employees desire empowered environments, what keeps leaders from encouraging self-sufficiency in their employees? The short answer is a skewed perception of reality.

The breakdown often begins when leaders don’t see their employees making decisions and taking action quickly enough, or in the same way the leader would do it. In this situation, you understandably might question the motivation behind the employee’s lack of autonomy. Some executives I’ve coached have told me they wonder if their employees don’t care, if they’re not ambitious or competent enough to do the job. They often assume their employees need or want more direction because they seem to require help or feedback before moving forward. In other words, leaders often feel the problem is with their employees, not them.

Autonomy in the workplace is hard to implement and easy to abuse. It requires managers and employees to trust each other and communicate on projects, which can be challenging in their own rights. Too often, a communication breakdown leads to micromanaging or missed deadlines.

By tapping into information-sharing channels and mutual trust, it’s possible to increase team autonomy in the workplace. Here are a few examples of companies channelling information well and how employees become more autonomous because of it.

Many leaders instinctively want complete visibility of their team.

This is a recipe for micromanagement.

Interesting statement by Dr David Rock from The NeuroLeadership Institute, when he said: “Although we may not think about it often, everyone experiences the workplace as a social system. People who feel betrayed or unrecognized at work, experience it as a neural impulse, as powerful and painful as a blow to the head.”

He goes on to say that employees tend to limit their commitment and engagement if they feel undervalued. “They become purely transactional employees, reluctant to give more of themselves to the company, because the social context stands in their way.”

This type of situation can be the root cause of a low-performing team. Think about times that you have been part of such a team. It quickly demotivates everyone, plus rectifying the situation is very difficult once it takes hold. Your managerial challenge is to provide conditions where such a situation is less likely to happen, and giving the team a measure of autonomy in how to carry out their work is key.

Based on research and anecdotal evidence, there’s no denying workplace autonomy promotes employee happiness. A workplace survey by Gensler concluded that employees given more choices are more satisfied and higher performing than counterparts with fewer freedoms. Autonomy often inspires a culture of innovation, and allows employees an opportunity to become more self-sufficient. For executives, this means less time overseeing daily operations and more time focused on strategy and growth. But for a company that still hasn’t shifted to an autonomous environment, the idea of giving employees so much freedom can be a little unsettling.

Autonomy is quickly becoming the norm. Employees not only desire greater control over their work style and environment — they expect it. By exercising the above suggestions, you can help create a culture of freedom and choice without sacrificing efficiency, productivity and structure.

In order to make your team more autonomous, you need to establish communication and trust. Without communication, you’re leaving your employees without a safety net while your employees are working in isolation

Let’s look at some of the disadvantages of employee empowerment:

Lack of experience increases risk

While the handing down of responsibility promises to improve speed, agility and productivity, a concern is that decisions are now being made by less experienced and less expert personnel. This can increase the number of mistakes made and put reputation at risk.

The risk of work practices falling into chaos must be tackled by proper training, and by ensuring that supervisors maintain organizational standards. These standards must incorporate an organization’s values and beliefs: care must be taken that employees do not work in accordance with individual values that may be divergent to the corporate mission and vision.

Potential for decreased efficiency

When people are given the autonomy to make their own decisions, those decisions cease to be uniform. This lack of coordination can lead to problems down the line.
It is also the case that autonomous employees may decide to work slower on days when they feel distracted or lack the energy to forge ahead. Where some workers are performing more productively than others, without being rewarded for doing so, internal friction can increase. If not dealt with, this can cause confrontation or a spiral to the bottom as all workers decide to work at the pace of the slowest and least productive team member.

Failing relationships

Empowerment inevitably leads to a flatter, more streamlined management structure. The risk here is that professional relationships become blurred, and boundaries of authority become broken. This might require greater control over employees, not less.

Accountability issues may arise, leading to a blame culture that, if left unchecked, will lead to further discontent and an environment of mistrust. In such a situation, it is likely that employees will decide to take less responsibility for fear of repercussions should things go wrong.

Poor decision-making
If a team lacks the individuals with skills commensurate to the project, tasks, and work required, decision-making will be poorer. This will be to the detriment of the organization, as poor solutions lead to decreasing productivity and internal conflict.

Are you really a leader if nobody is following?

As a leader, you should have an element of magnetism to your style. What do I mean by that? I mean that people should be drawn to you; they should want to be around you – by choice, that is, not because it’s their job to take your direction. The greatest leaders have a natural following of people that are pointed in the same direction; people that want to accomplish the same goals; people that want to be on your journey!

These relational principals apply across the board. Just because you’re in a leadership position doesn’t mean that you’ve attained perfection. You’re human. You’re going to make mistakes. You’re going to have questions, and people will respect you more for owning that. Your transparency and honesty open the doors for you to engage others and rely on their strengths and expertise. Your team will feel needed and valued by you, and they will likely jump into help compensate for your weaknesses.

In addition to being authentic about yourself, leaders should realise the importance of being open and honest about the state of their organization, current and future. Leaders should be clear and candid in their communication to give everyone an accurate assessment of what’s going on and what’s needed to improve. This openness and authenticity create understanding and direction, and it minimizes the chaos of uncertainty.

The truth of the matter is that we cannot all be the leader in charge.

The end result is that many people want to be led. They need someone who can be visionary and inspirational.

Perhaps there is some overlap with this and some of the other points already mentioned, but I thought it was important to say it in this particular way. The reason for that is because this puts the focus on understanding what your people need. To do this, you must get to know your people. You have to ask questions, listen and engage. This is a critical component to understanding people and meeting their needs.

Which brings me on to ‘we are a direct reflection of our experiences’ – the way we behave and not all organisational cultures are created equal. Your company’s behaviors and norms can be unhealthy and unsupportive. But take heart: your organisation has the power to build a high-performance culture. A high-performance culture has behaviors and norms that lead your organisation to achieve superior results by setting clear business goals, defining employees’ responsibilities, creating a trusting environment, and encouraging employees to continuously grow and reinvent themselves.

Employee engagement is a direct outcome of a high-performance company culture. Why? Because high-performance cultures clearly outline behaviors and norms that are healthy and supportive.

Employees clearly understand their culture and what is expected of them. They feel connected. They feel involved. They feel supported. And, therefore, they feel engaged. A company that takes its people seriously will have a business strategy, vision, mission and values.

It’s alarming to know that eighty-seven per cent of HR leaders state that company culture and engagement are their biggest challenges. It makes sense. There are several reasons culture and engagement are rising as relevant challenges for organisations. To start, employer branding has become more and more important. Employees are very much like customers. With the changes in the job market, employees have greater opportunities than they had in the past.

This puts employers in the position of having to actively attract employees, all while employees’ perceptions about work are changing. For the most part, employees no longer prioritise staying at a single job until retirement and instead are very uncommitted, they are more likely to choose a job that interests them and aligns with their own passion and values at a moment in time. Your organisation needs to regularly invest in culture to regularly see the resulting engaged employee base.

By providing training opportunities, the latest in technological advancements, managerial support, and an open mind about what makes a great workplace environment, companies can evolve to keep pace with employees’ expectations to really drive success. The key is that this is an ongoing process. Engagement doesn’t just happen – you have to focus employee needs over time and use that to drive a strong culture, a good way to achieve this is with an HR development plan, which has the engagement of senior leadership, management and the board of directors.

Final thought, by supporting people we employ or our family members to develop themselves so that we can each reach a state where we are conscious that the interior work is as important as our exterior communication skills.

By learning to deploy those skills to give individual context and insight to host other conversations, which would be vastly more helpful than the kind of conversation that happens in the superficial contextual layer.

We nominally share a language with others; sometimes not even that. Language isn’t helping us bridge the divide of ideological differences effectively any more. Embodied dialogue methods, like constellations and storytelling, can open new perspectives in people’s minds.

I am not convinced in my lifetime that an intuitive or compassionate AI, or robot will even come close to this objective, we need better leadership to drive home performance and growth outcomes, based around passionate, committed and determined humans.

A great quote by John Maxwell, where he states:

“If you are leading others and you’re lonely, then you’re not doing it right. Think about it. If you’re all alone, that means nobody is following you. And if nobody is following you, then you’re not really leading.”

Emotional Intelligence and Your Survival through the 4th Industrial Revolution!

Many experts now believe that a person’s emotional intelligence quotient (EQ) may be more important than their IQ and is certainly a better predictor of success, quality of relationships, Meaningful Conversations and overall happiness.

I have written many blogs on the subject, some of my readers may even recall the balance of IQ vs EQ is it really necessary?

Emotion has long been something of a taboo subject in the workplace. It’s widely seen as inherently negative – it clouds decision-making; allegedly it’s a source of weakness; it should be left somewhere but certainly not at the office. But recent changes in business and the wider world have caused a seismic shift in how people view emotion and appreciate its power when used intelligently.

One of the root causes is that the composition of the workforce has changed vastly over a relatively short period. It has become far more diverse in terms of ethnicity, culture, religion, gender and sexuality. And a gap has opened up, especially between members of the older generations who run most organisations and the millennials and gen Z-ers who work for them when it comes to personal values and expectations of employment.

The Deloitte Global Millennial Survey 2019 has found that millennials (defined by the researchers as those born between January 1983 and December 1994) and gen Z-ers (born January 1995 to December 1999) are mistrustful of businesses that prioritise their own agendas over their impact on society.

Many respondents to the Deloitte Global Millennial Survey said they would cut immediate ties with any company that didn’t share their values.
With the active rise of EQ, The World Economic Forum now considers EQ a crucial skill for the fourth industrial revolution, while research has always shown that EQ improves decision-making and morale in organisations.


The Fourth Industrial Revolution introduces integrated adjustments to the way we interact with the world around us, including new advancements like the Internet of Things, the Internet of Systems, artificial intelligence, and more. We’re looking at not just technological assistance, but a flourishing form of technological assimilation

Move over, IQ; it’s not just about increased academia anymore. The Fourth Industrial Revolution will change how we interact with one another in conjunction with our technology, and it requires that we reconnect with our EQ (emotional quotient). As AI begins to make its way into the decision-making processes of modern business, emotional and social intelligence become two capabilities that can’t be automated yet – so more Meaningful and Purposeful Discussions…….?

In fewer than five years, more than a third (35%) of skills considered important today will have changed, according to this REPORT by The World Economic Forum. Amongst cognitive abilities such as complex problem solving and critical thinking, emotional intelligence – often referred to as ‘street smarts’ – has been identified as a crucial social skill that will be needed by all.

The report, based on the opinions of chief HR and strategy officers from leading global organisations, suggests that seismic advances in technology including artificial intelligence, advanced robotics and machine learning will revolutionise the way we live and work. As a result, organisations and employees will be under growing pressure to upgrade and fine-tune their skillsets to thrive, or even survive, in what is being termed The Fourth Industrial Revolution.

It’s one thing to have complex thinkers with lightning-fast computational skills and incomparable technical abilities, but it’s quite another to have an intercommunicating workforce that’s situationally aware and adaptive.

Consider the example of FedEx, which took EQ to heart when designing its leadership program. By focusing on building emotional intelligence into its management team, the company has yielded an 8-11 percent increase in core leadership competencies. Employees also made vast improvements in their decision-making and influencing abilities and experienced a marked improvement in their quality of life.

According to The World Economic report, by 2020 there will be a greater bidding war for employees with social abilities including persuasion and emotional intelligence compared to more limited technical skills like programming or equipment operation and control. Furthermore, professions previously seen as purely technical will see new demand for interpersonal skills, such as being able to communicate data effectively. Emotional intelligence is likely to be a major deciding factor in who will be able to adapt and flourish in these new roles.

In his books, ‘Emotional Intelligence: Why It Can Matter More than IQ and Working With Emotional Intelligence’, Daniel Goleman presents five categories of emotional intelligence. To hire candidates who will thrive in your workplace, look for those who have a handle on these five pillars:

1. Self-awareness: If a person has a healthy sense of self-awareness, he understands his own strengths and weaknesses, as well as how his actions affect others. A person who is self-aware is usually better able to handle and learn from constructive criticism than one who is not.

2. Self-regulation: A person with a high EQ can maturely reveal her emotions and exercise restraint when needed. Instead of squelching her feelings, she expresses them with restraint and control.

3. Motivation: Emotionally intelligent people are self-motivated. They’re not motivated simply by money or a title. They are usually resilient and optimistic when they encounter disappointment and driven by an inner ambition.

4. Empathy: A person who has empathy has compassion and an understanding of human nature that allows him to connect with other people on an emotional level. The ability to empathize allows a person to provide great service and respond genuinely to others’ concerns.

5. People skills: People who are emotionally intelligent are able to build rapport and trust quickly with others on their teams. They avoid power struggles and backstabbing. They usually enjoy other people and have the respect of others around them.

Daniel Goleman on the importance of emotional intelligence

Effective leadership requires mastering and blending both left- and right-brain thinking.

Accenture recently conducted a research study across 200 C-suite executives from France, Germany, Italy, Spain, the United Kingdom and the United States which indicated that pushing the C-suite to find new ways to lead, grow and sustain their organisations, demands a new type of leader to engage passion, principles and capabilities. Their expectation? Leaders who have a strong balance across analytics-led and human-centred skills.

This approach blends what’s traditionally been considered “left-brain” (scientific) skills that draw on data analysis and critical reasoning with “right-brain” (creative) skills that draw on areas like intuition and empathy. Bringing the two together intentionally to drive deeper levels of problem-solving and value creation is critical.

But the majority (89%) of today’s C-suite leaders hold business school, science, or technology degrees and have honed “left brain” skills—like critical reasoning, decision-making and results-orientation. Numbers. Data. Stats. The science of management, rooted in reasoning and proof points. This has served them well, and these capabilities will always be vital. But they are no longer sufficient.

Final thought. As the pace of change continues to accelerate and we head towards the Fourth Industrial Revolution, being able to identify and anticipate future skills requirements will be crucial. Those organisations and employees who embrace and prepare for the changes will be the biggest winners.

Look around you: Tech is being transfused into the veins of every industry. You need to make an educated guess as to how — and which — new technologies could impact your business and then act.

Rapid disruptive change is inevitable, and the assimilation of technology into every aspect of modern business is unavoidable.

The question is whether today’s business leaders can remain competitive in a technological world that’s rapidly and exponentially evolving. The tide is rising on the Fourth Industrial Revolution.

Guest-blog: Patrick Bailey – Diversification vs. focus-driven

Patrick Bailey

Adversity of any magnitude should make us stronger and fill us with life’s wisdom, however, strength in any form is born from adversity – I wrote ‘Freedom after the Sharks’ from adversity and set up a business in the double-dip of 2008 and 2009, many people have done the same and it is almost a universal theme in the lives of many of the world’s most eminent minds.

As Michelle Obama once said:
‘You should never view your challenges as a disadvantage. Instead, it’s important for you to understand that your experience facing and overcoming adversity is actually one of your biggest advantages.’

Determination, resilience, and persistence are the enabler for people to push past their adversities and prevail.
Overcoming adversity is one of our main challenges in life.
When we resolve to confront and overcome it, we become expert at dealing with it and consequently triumph over our day-to-day struggles.

Have you ever felt that your world is starting to fall apart because of how life tends to bombard you with seemingly impossible challenges?
Have you ever felt helpless and would rather spend your days feeling like a solitary zombie while the rest of the world doesn’t even care that you’re this close to almost losing your sanity?
Well, you’re not alone and the good news is, there are ways to properly deal with and overcome these obstacles.

Reality has a way of reminding us that no matter how hard you try and how good you treat people, you will always have those days, those times when you think the world is against you. During these moments, you often have the urge to either shut down or finally give up and think of the most foolish remedies available to you – both can have long-term damaging effects on you, emotionally and physically.

Today I have the pleasure of introducing another Guest Blogger, Patrick Bailey, who is a professional writer mainly in the fields of mental health, addiction, and living in recovery.

He attempts to stay on top of the latest news in the addiction and the mental health world and enjoys writing about these topics to break the stigma associated with them. His website is: www.patrickbaileys.com

Patrick is going to discuss with us today “Diversification vs. Focus-Driven”

When the Tough gets going, remember this motto: ‘Hibernation is not Survival’

There’s a prevailing rule in a bear market, and that is to play dead when the stock prices are plunging.

After all, the market almost always corrects itself. Stocks operate on a cycle — sometimes up, sometimes down — except, of course, in cases when the economy is undergoing a recession.

Hibernation is different from inactivity, however. You just park your money in treasury bills or certificates of deposits for the moment.

But is hibernation a good tactic for your business during an economic slowdown?

Diversification vs. Focus-Driven

This has been the subject of debate.

Startups that manage to grow will often hit a fork in the road where they can no longer grow with their current set up.

Now, they have to make a choice: diversify their portfolio or bolster their product while they take a more focus-driven approach.

Instead of diversifying, they just ensure that their processes and workflow are more efficient, they automate to limit disruption and enhance the customer experience to guarantee client loyalty.

However, while you may see your bottom-line increase, it could just be temporary. That’s because you are not adding products or service value to your business.

Diversification doesn’t immediately produce results either. There’s no guarantee it will ever deliver the outcome you anticipate.

When the economy is in transition, you will find many competitors fighting over the scraps. This is a high-stakes game that could spell success or the end of your business. However, the alternative is no less disastrous.

The other option is not doing anything. When you pin the future of your company entirely on the hope that the economy will get better, you have the wrong strategy.

If you do decide to diversify, here are some quick tips to cut your risks:

  1. Don’t veer away too much from your core competency. Diversification doesn’t always mean being different. That’s oversimplifying its definition. Knowing your core competence will give you insight into how other capabilities tie together. Your main goal should be to create a new product or service that is still tied to your core competency in order to bring in new customers.
  2. Don’t forget your loyal customers. In fact, you need to align your strategies by boosting the value of your core business. You then retain the same customers and offer them another product that matches another — but still related — need.
  3. Put money into your marketing efforts. Ads and promotions are typically the first things to be sacrificed by companies that are scrimping on the budget. However, you need to make people aware that you have a new product. Even in an economic slowdown, people still buy. That’s consumer resiliency. You need to funnel these customers to your company by showing them that you are the answer to their most nagging questions.
  4. Timing is everything. Still aligning your diversification with your core competencies, you need to know when to change tack and when to sit it out. Before deciding to diversify, you need to bolster your core business to make sure you don’t lose focus. When the revenues have plateaued, then it’s time to shore up your business and add value by creating another product or service.
  5. Watch out for your cash flow. Revisit your inventory and your credit policies. When the times are tough, you may need to borrow in order to infuse new capital into your endeavors. However, no bank will offer you a lifeline when you have a shot credit and lousy financial prospects.

The Best Defense is a Good Offense

There’s a saying in sports and even in war: The best defense is a good offense.

This strategy will allow you to take back control of the situation. Rather than wait for the next hammer to fall, you change your approach and bring the fight to the enemy.

This is a scary part, especially when the economic landscape is very fluid. However, there are numerous success stories of businesses that found some opportunities when they decided to go on the offensive rather than wait the economy out.

Of course, there’s no guarantee that this result in a better outcome, but it’s a lot better than playing dead while you wait for the economy to turn.

Here are some quick tips on how to go on offense from defense:

  1. Diversify. If you are putting all your eggs in one basket, chances are you will lose money if most of them crack. Businesses that rely only on one product will be badly hit during a slowdown.
  2. Think outside the box. It doesn’t even matter if you are earning less with your new business than you were with the old one. Expanding your network is the only way to learn and earn. Step out of your comfort zone and attend some industry trade shows.
  3. Reinforce relationships. This is a good way to let your clients know that you can be trusted even when the times are bleak. Don’t cut corners on the quality of your work, and don’t use the economy as an excuse for missing deliveries. In the same vein, get in touch with your suppliers to reassure them that work will continue (although the volume likely will be down).
  4. Cut fat. Sometimes the only way to take flight is if your business isn’t as heavy. This is a good opportunity to revisit your operations and trim the fat. You will find that your employees won’t be inflexible when you institute changes. They know that the market is very challenging, and they will be more apt to help.
  5. Form an advisory board. It seems paradoxical to suggest this when the item above tells you to cut fat. But if done correctly, the board can become a rich repository of ideas with which you can follow-through as you go about diversifying your products and services.
  6. Automation and analytics. Automating your workflow can boost your efficiency. Big data analytics are already being used by companies in order to improve customer experience. Analytics will give you insight into the minds and behaviors of your clients. This, in turn, will help you come up with a product that truly addresses their needs.
  7. Ask for help. If you are a member of any industry associations, this is the right time to touch base. The government also has some assistance to offer — in terms of technology transfer or financial assistance — to help you keep your head above water.

Lastly, you need to understand that there’s life beyond your business. Too often, you see CEOs with failed marriages and broken families because they prioritized their careers at the expense of spouses and children.

You hear of executives becoming addicted to the drug fentanyl, heroin, or alcohol to help them cope. They equate the failure of the business to their value as an individual.

However, there are more important things in life than being a successful CEO.

Life is all about challenges. Life will push you down if you refuse to push back. It doesn’t matter how many times you stumble. What’s important is how many times you get back up.

Take advantage of the economic slowdown to take stock of what’s important to you.
Bond with the kids, rekindle the romance with your spouse, visit your parents and siblings.
You just might realize that it doesn’t matter if you see yourself as a failure; you will be a hero in your kids’ eyes.

You can contact Patrick Bailey:

Email: bailey patrick780 @gmail.com (remove spaces)
Blog: http://patrickbaileys.com
Twitter: https://twitter.com/Pat_Bailey80
LinkedIn: www.linkedin.com/in/patrick-bailey-writer

Not-for-Profit Directorships – It’s not a charity!

Roger Phare

Today, non-profit organisations in the United States control upward of $1.5 trillion in assets and are increasingly relied upon to help address society’s ills.

Corporations are not alone in focusing on governance; rigorous oversight of management and performance is increasingly important for non-profits too.

The corporate-governance debate globally is spreading from the for-profit to the non-profit world.

To improve the governance of non-profits, boards must venture beyond the traditional focus on raising funds, selecting CEOs, and setting high-level policy.

The litmus test of the chief executive’s leadership is not the ability to solve problems alone but the capacity to articulate key questions and guide a collaborative effort to formulate answers.

Theory and law dictate that the board of directors is responsible to govern your organization. Typically, new boards of directors in a new organization work hands-on, almost as partners — or as a “working board” — with the chief executive. A wise CEO will see Board members almost as strategic partners, rather than as a necessary evil that corporations must have.

It is important if you are building a board with the right set of tasks in mind. Boards have multiple roles, from fundraising to caretaking, governance, and oversight. Just like any company or corporation, it is important to do an assessment. Understand the skills that your particular non-profit needs to fulfil your mission.

Putting together an outstanding non-profit board is easier said than done, and it takes a lot of precision. Not everyone makes a great board member, so it’s acceptable to be picky when it comes to putting together a non-profit board.

Board challenges are something that many non-profits struggle with, and there’s no easy solution. We often hear horror stories of board takeovers—when the non-profit leadership is “overthrown” by its board of directors.

We welcome back Roger Phare as our guest blogger who is an accomplished Global Executive Director, equipped with a commanding track record over the past 38 years of bringing sound judgement and a strong commercial perspective to IT businesses, from ‘Mainframe to Mobile’.

Roger has been fortunate to have been part of the commercial computing lifespan. With a market driven approach, which he has strategically supported, a number of organisations, both at significant Board, Executive and Regional Directorship and responsibilities. An expert in corporate governance and compliance and risk management; enjoying challenging the status quo and providing independent advice to Boards whilst maintaining sound judgment, impartiality and with integrity.

Roger is going to talk to us about ‘Not-for-Profit Directorships – It’s not a charity!’

Thank you Geoff, the blog heading might seem like an oxymoron (or perhaps even a paradox for those of the literary-minded fraternity). After all, surely Not-for- Profit (NFP) organisations are charities; a fact that very few would dispute. At board level, however, the leadership, governance and compliance responsibilities are on at least an equal footing with commercial businesses of equivalent size and complexity.

I mentioned in a previous blog that that the term “Not-for-Profit” is a misnomer; in reality the correct term would be more likely “Not-for-Dividend”. In other words there is nothing at all wrong with, in fact commendable that, a charitable organisation makes an operational monetary surplus. The major difference is that the surplus is not distributed to external shareholders but channelled back into the organisation for ongoing initiatives. The governance and risk at board level is substantial and yet directors are often voluntary – pro-bono if you like.

The issue is not just one of payment but the value and importance placed upon such roles. At a recent business event I overheard a young professional discussing board opportunities. The individual was alluding to a recent application they had made to become a voluntary director on a NFP board. They went on to say that they hoped it would give them experience to apply for “proper” board positions in the future and – wait for it – if they made mistakes along it didn’t really matter because it was only voluntary! The concept of “free” having little or no “value” is the problem.

Now I am not proposing that Not-for-Profit Directors are necessarily paid at the highest commercial rates; there does need to be a good amount of desire and passion to be involved with the sector which means there is in-effect, a subsidised participation. I have long held the view that the NFP sector should consider the concept of “paid volunteers” (there’s that oxymoron thing again) for all roles within the organisation. What does this mean? Well – currently NFP’s have two types of staffing – paid and voluntary. Voluntary means no payment (other than direct expenses) and this leads to issues such as talent pool availability plus difficulties in selection of one candidate over another.

If, union rules permitting, all staff were paid volunteers i.e all paid but at say, 50% of market rates then this overcome a good number of the issues currently faced. At board level an experienced director could value the 50% subsidy as their pro-bono contribution, yet still be able to justify the time, effort and corporate responsibility required within their portfolio.

With this approach, charity could well begin at home….

We hope you enjoyed this blog!

You can contact Roger Phare via LinkedIn: Roger Phare on LinkedIn
or by email: roger phare @ gmail .com (remove all spaces)

Do we need AI, if humans can grow in development?

It seems like every day there is a new article or story about artificial intelligence (AI). AI is going to take over all of the jobs. AI is going to do all of the repetitive, menial tasks carried out by admins on a daily basis. AI is going to rise up and take over. AI is not going to take over but instead be natively baked into all systems to produce more human interactions.

For all the things AI is allegedly going to do, it can already do a lot right now, such as automation, custom searches, security interventions, analysis and prediction on data, serve as a digital assistant, perform algorithm-based machine learning and more.

It will be a good number of years before we get AI doing everything for us, the real question is can humans survive without AI?

Does anyone recall the Trachtenberg speed system of basic mathematics?

The Trachtenberg Speed System of Basic Mathematics is a system of mental mathematics which in part did not require the use of multiplication tables to be able to multiply. The method was created over seventy years ago. The main idea behind the Trachtenberg Speed System of Basic Mathematics is that there must be an easier way to do multiplication, division, squaring numbers and finding square roots, especially if you want to do it mentally.

Jakow Trachtenberg spent years in a Nazi concentration camp and to escape the horrors he found refuge in his mind developing these methods. Some of the methods are not new and have been used for thousands of years. This is why there is some similarity between the Trachtenberg System and Vedic math for instance. However, Jackow felt that even these methods could be simplified further. Unlike Vedic math and other systems like Bill Handley’s excellent Speed Math where the method you choose to calculate the answer depends on the numbers you are using, the Trachtenberg System scales up from single digit multiplication to multiplying with massive numbers with no change in the method.

Multiplication is done without multiplication tables “Can you multiply 5132437201 times 4522736502785 in seventy seconds? One young boy (grammar school-no calculator) did successfully by using the Trachtenberg Speed System of Basic Mathematics.

So, with human intelligence why do we need AI, AGI, deep learning or machine learning?

Faster than a calculator, Arthur Benjamin discusses the speed of mathematics TEDxOxford

Albert Einstein is widely regarded as a genius, but how did he get that way? Many researchers have assumed that it took a very special brain to come up with the theory of relativity and other stunning insights that form the foundation of modern physics. A study of 14 newly discovered photographs of Einstein’s brain, which was preserved for study after his death, concludes that the brain was indeed highly unusual in many ways. But researchers still don’t know exactly how the brain’s extra folds and convolutions translated into Einstein’s amazing abilities.

Experts say Einstein programmed his own brain, that he had a special brain when the field of physics was ripe for new insights, that he had the right brain in the right place at the right time.

Can we all program our brains for advancement, does our civilisation really need our brains rely on AI/AGI?

Artificial intelligence is incredibly advanced, at least, at certain tasks. AI has defeated world champions in chess, Go, and now poker. But can artificial intelligence actually think?

The answer is complicated, largely because intelligence is complicated. One can be book-smart, street-smart, emotionally gifted, wise, rational, or experienced; it’s rare and difficult to be intelligent in all of these ways. Intelligence has many sources and our brains don’t respond to them all the same way. Thus, the quest to develop artificial intelligence begets numerous challenges, not the least of which is what we don’t understand about human intelligence.

Still, the human brain is our best lead when it comes to creating AI. Human brains consist of billions of connected neurons that transmit information to one another and areas designated to functions such as memory, language, and thought. The human brain is dynamic, and just as we build muscle, we can enhance our cognitive abilities we can learn. So can AI, thanks to the development of artificial neural networks (ANN), a type of machine learning algorithm in which nodes simulate neurons that compute and distribute information. AI such as AlphaGo, the program that beat the world champion at Go last year, uses ANNs not only to compute statistical probabilities and outcomes of various moves, but to adjust strategy based on what the other player does.

Facebook, Amazon, Netflix, Microsoft, and Google all employ deep learning, which expands on traditional ANNs by adding layers to the information input/output. More layers allow for more representations of and links between data. This resembles human thinking when we process input, we do so in something akin to layers. For example, when we watch a football game on television, we take in the basic information about what’s happening in a given moment, but we also take in a lot more: who’s on the field (and who’s not), what plays are being run and why, individual match-ups, how the game fits into existing data or history (does one team frequently beat the other? Is the centre forward passing the ball or scoring?), how the refs are calling the game, and other details. In processing this information we employ memory, pattern recognition, statistical and strategic analysis, comparison, prediction, and other cognitive capabilities. Deep learning attempts to capture those layers.

You’re probably already familiar with deep learning algorithms. Have you ever wondered how Facebook knows to place on your page an ad for rain boots after you got caught in a downpour? Or how it manages to recommend a page immediately after you’ve liked a related page? Facebook’s DeepText algorithm can process thousands of posts, in dozens of different languages, each second. It can also distinguish between Purple Rain and the reason you need galoshes.

Deep learning can be used with faces, identifying family members who attended an anniversary or employees who thought they attended that rave on the down-low. These algorithms can also recognise objects in context such a program that could identify the alphabet blocks on the living room floor, as well as the pile of kids’ books and the bouncy seat. Think about the conclusions that could be drawn from that snapshot, and then used for targeted advertising, among other things.
Google uses Recurrent Neural Networks (RNNs) to facilitate image recognition and language translation. This enables Google Translate to go beyond a typical one-to-one conversion by allowing the program to make connections between languages it wasn’t specifically programmed to understand. Even if Google Translate isn’t specifically coded for translating Icelandic into Vietnamese, it can do so by finding commonalities in the two tongues and then developing its own language which functions as an interlingua, enabling the translation.

Machine thinking has been tied to language ever since Alan Turing’s seminal 1950 publication “Computing Machinery and Intelligence.” This paper described the Turing Test—a measure of whether a machine can think. In the Turing Test, a human engages in a text-based chat with an entity it can’t see. If that entity is a computer program and it can make the human believe he’s talking to another human, it has passed the test.

But what about IBM’s Watson, which thrashed the top two human contestants in Jeopardy?

Watson’s dominance relies on access to massive and instantly accessible amounts of information, as well as its computation of answers’ probable correctness.

Why humans will always be smarter than AI…..

This concept of context is one that is central to Hofstadter’s lifetime of work to figure out AI. In a seminal 1995 essay he examines an earlier treatise on pattern recognition by Russian researcher Mikhail Bongard, a Russian researcher, and comes to the conclusion that perception goes beyond simply matching known patterns:

… in strong contrast to the usual tacit assumption that the quintessence of visual perception is the activity of dividing a complex scene into its separate constituent objects followed by the activity of attaching standard labels to the now-separated objects (ie, the identification of the component objects as members of various pre-established categories, such as ‘car’, ‘dog’, ‘house’, ‘hammer’, ‘airplane’, etc)

… perception is far more than the recognition of members of already-established categories — it involves the spontaneous manufacture of new categories at arbitrary levels of abstraction.
For Booking.com, those new categories could be defined in advance, but a more general-purpose AI would have to be capable of defining its own categories. That’s a goal Hofstadter has spent six decades working towards, and is still not even close.

In her BuzzFeed article, Katie Notopoulos goes on to explain that this is not the first time that Facebook’s recallbration of the algorithms driving its newsfeeds has resulted in anomalous behavior. Today, it’s commenting on posts that leads to content being overpromoted. Back in the summer of 2016 it was people posting simple text posts. What’s interesting is that the solution was not a new tweak to the algorithm. It was Facebook users who adjusted — people learned to post text posts and that made them less rare.

And that’s always going to be the case. People will always be faster to adjust than computers, because that’s what humans are optimized to do. Maybe sometime many years in the future, computers will catch up with humanity’s ability to define new categories — but in the meantime, humans will have learned how to harness computing to augment their own native capabilities. That’s why we will always stay smarter than AI.

Final thought, perhaps the major limitation of AI can be captured by a single letter: G. While we have AI, we don’t have AGI—artificial general intelligence (sometimes referred to as “strong” or “full” AI). The difference is that AI can excel at a single task or game, but it can’t extrapolate strategies or techniques and apply them to other scenarios or domains you could probably beat AlphaGo at Tic Tac Toe. This limitation parallels human skills of critical thinking or synthesis—we can apply knowledge about a specific historical movement to a new fashion trend or use effective marketing techniques in a conversation with a boss about a raise because we can see the overlaps. AI has restrictions, for now.

Some believe we’ll never truly have AGI; others believe it’s simply a matter of time (and money). Last year, Kimera unveiled Nigel, a program it bills as the first AGI. Since the beta hasn’t been released to the public, it’s impossible to assess those claims, but we’ll be watching closely. In the meantime, AI will keep learning just as we do: by watching YouTube videos and by reading books. Whether that’s comforting or frightening is another question.

Stephen Hawking on AI replacing humans:

‘The genie is out of the bottle. We need to move forward on artificial intelligence development but we also need to be mindful of its very real dangers. I fear that AI may replace humans altogether. If people design computer viruses, someone will design AI that replicates itself. This will be a new form of life that will outperform humans.’

From an interview with Wired, November 2017

Disruptive change is inevitable – Change is constant

Change is inevitable.

More and more organisations today face a dynamic and changing environment. The oft-heard rallying cry in today’s organisations is “Change or die.” Survival in today’s global economy requires organisations to be flexible and adapt readily to the ever-changing marketplace. Change has become the norm. It is as necessary for organisations to pay as much attention to the psychological and social aspects of change as they do to the technological aspects.

We live in an era of risk and instability. Globalisation, new technologies, and greater transparency have combined to upend the business environment and give many CEOs a deep sense of unease. Just look at the numbers. Since 1980 the volatility of business operating margins, largely static since the 1950s, has more than doubled, as has the size of the gap between winners (companies with high operating margins) and losers (those with low ones).

Change is the one true constant in business, especially when it comes to operating a business. Having defined processes in place to effectively manage change can help companies sustain success.

In today’s business environment, knowing how to successfully navigate these changes and develop appropriate and effective processes to properly manage such change is a must. It’s virtually impossible for organisations to make sound strategic decisions and completely accomplish objectives when deprived of strong change management strategies. This is especially true in the world of project, program and portfolio management, where obstacles and ambiguity are inevitable at every juncture.

Companies all over the world find that they have to continually make changes to the way they work in order to stay ahead of the game, be profitable, and be relevant. Oftentimes, the changes could be externally mandated, internally conceived, or both, but the reality is that companies do have to evolve, change, or die. The global landscape is changing: businesses are moving to take advantage of new markets; organisations are restructuring to operate better, given the current market dynamic; competition is causing companies to radically change the way they do business.

The old business is not coming back – this is not just a statistic, it is a fact.

Companies operate in an increasingly complex world: Business environments are more diverse, dynamic, and interconnected than ever – and far less predictable. A study I read recently suggests that 75% of the S&P 500 will turn over in the next 15 years.

Many businesses that “have done things the same way for years” are affected by disruptive change: the economy changes, the competition changes, products change, technology changes, customers change, employees change, vendors change, buying methods change, delivery methods change.

Disruptive change is coming, and the only question is whether companies are going to cause it or fall victim to it. Disruption is not easy, to create or to confront it.

Businesses need to grow continuously in one way or another to achieve and maintain success. Growth comes by making positive changes that promote growth and by responding correctly to external changes.

Organisations throughout the world and across the global markets also recognise the need to embrace ‘nimbleness’ and ‘agility’ if they are to survive in the long run. The ever-changing landscape, globalisation, global dynamics, make it inevitable that companies have to evolve fast, repeatedly, and in a continuously improving manner in order to comply with regulations, collaborate with customers, and stay ahead of competition.

Whilst awareness of the challenges associated with change is prevalent, there is also compelling evidence of the long-term benefit of being great at driving organisational change. Therefore, it is expedient to look at some of the reasons why change is difficult, so that we can deliberately tackle the reasons for change complexity.

Sustaining success depends on an organisation’s ability to adapt

Why can some companies take advantage of any change the market brings, while others struggle with market-necessitated modification? The reasons why will differ for each organisation, but the question is definitely worth asking especially in light of the fact that the pace of change is accelerating at the fastest rate in recorded history.

Most companies find it hard to transform themselves in difficult circumstances. Corporate transformation under pressure.

Leadership needs to have a mindset that although change ability (agility, resilience) is essential for the survival and growth of many companies, there needs to be a concerted effort to build capacity to lead change effectively, and to purposefully build a change friendly culture in a systemic manner. This means that change leadership or sponsorship becomes a leadership competency that is recruited for and developed in leaders in the same way that it is done for other competencies such as decision-making.
Companies most likely to be successful in making change work to their advantage are the ones that no longer view change as a discrete event to be managed, but as a constant opportunity to evolve the business.

Change readiness is the new change management: change readiness is the ability to continuously initiate and respond to change in ways that create advantage, minimise risk, and sustain performance.

Organisations, and the people within them, must constantly re-invent themselves to remain competitive. Sustaining success depends on an organization’s ability to adapt to a changing environment.

Senior executives recognise that in order to compete optimally in the current and future landscapes, their companies will be expected to do more for less in a more dynamic landscape with issues of globalisation, new market opportunities, and new ways of doing business. There is a recognition that the changes are going to increase and the demands for business benefits realisation will also increase. It is therefore no longer optional for leaders to increase their ability to successfully implement strategies by increasing their ability to manage change and in fact leveraging this change management skill to become a competitive advantage.

If you’re struggling or your market is down, change management is especially critical because growing companies are not afforded the time to weather the storm of down markets or decreased demand. Offensive change when the company is doing well is a whole lot easier to manage than defensive change.
With this sentiment, I am not suggesting that you overhaul your business entirely change your mission, vision, and values or abandon your product strategy with every minor bump in the road. I am suggesting, however, that the best companies the ones that experience exceptional long-term success are able to quickly recognise the need to change and make the tweaks necessary to help their business continue its growth trajectory.

Here are three tips that can help the journey of change easier:

  • Top down support from the CEO level down to the senior executives below the CEO is what ultimately drives successful change. When the changes are major, you need to create a burning platform scenario that will encourage a sense of urgency.
  • Clear, consistent, and transparent communication by all executives is critical to explain why the change is necessary. Throughout the change process, it’s important to regularly and clearly communicate the reasons for change and reinforce that message to your team so they understand why you’re taking the hill in front of you.
  • Quickly identify the senior team members who don’t buy in and encourage and support them to leave the company if they refuse to embrace change. This means you may lose some very good people who helped you get to where you are, but those people won’t be as valuable going forward if they aren’t willing to help you get to where you need to be.

Final thought on the subject – business is a little like the growth rings on a tree. Every year, something changes it could be your product, your top competitors, your customers’ preferences, or any number of things. The best companies adapt to those changes, reinvent themselves when change requires it, and find a way to grow – in good times and bad.

Successful organisations foster a positive attitude toward change by anticipating it and purposefully planning for change. Change must be addressed in an intentional, goal-oriented manner. Change is something that people should do, not something that is done to them. People are more comfortable with change when they participate in planning for or implementing it because they gain some sense of control which reduces their fears.

As George Soros once said:

‘Market fundamentalists recognize that the role of the state in the economy is always disruptive, inefficient, and generally has negative connotations. This leads them to believe that the market mechanism can take care of all the problems.’

Why Leadership Matters

As all leaders experience the highest of highs and the lowest of lows, you will know you have been tested in ways that you never expected. And yet, somehow, we all prevail. Despite the frustrations, anger and fear, you will have learned a lot about yourself. You will be be forced to recognise your own weaknesses and eccentricities, and discover reserves of strength that you had not known existed. In the process, you will become less judgmental and more accepting of yourself and of others.

Leadership forces you to stay true to yourself and to recognise when you are at your best and when you are at your worst; the important thing is to stay focused and keep moving forward. You will learn that overcoming adversity is what brings the most satisfaction, and that achievements are made more meaningful by the struggle it took to achieve them.
Leadership will conquer, the most profound truth of your individual journey’s. Courage, drive, determination, resilience, imagination, energy and the right team, you will find success.
Winston Churchill once said:

“This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.”

A single brain sometimes cannot take decisions alone. One needs the assistance and guidance of others as well to accomplish the tasks within the desired time frame. In a team, every member contributes to his level best to achieve the assigned targets. The team members must be compatible with each other to avoid unnecessary conflicts and misunderstandings.

Every team should have a team leader who can hold their team together and extract the best out of the team members. The team leader should be such that every individual draw inspiration from them and seek their advice and guidance whenever required. A leader should be a role model for his team members and a great mentor.

I had the pleasure of meeting Brendan Hall for lunch recently – he led the Spirit of Australia crew to overall victory in the Clipper 2009-10 Race, when aged 28. It was the second of three times the trophy has gone to an Australian team.

Recruiter 360 TV – Brendan Hall, Author of “Team Spirit” and winning Clipper round the world captain

Following the win, Brendan wrote the book “Team Spirit”, based on his race insights into the teamwork, leadership, skill, courage and focus required for performance.

Talking to Brendan he discussed how his team had just faced the ultimate challenge and one that they could never have been prepared for but circumstances dictated that they sail across the world’s largest ocean at a particularly fearsome time of year, on their own.

‘They had pulled together in the true sense of teamwork, and kept each other safe.’ ‘I feel it was their greatest achievement, and it was mine by association as I had got them to the point where they could take on that challenge. Ultimately that experience and those qualities led to our overall result.’

His crew were the same raw materials that every other boat had. They had characters and influential people and its leaders, together they made a great leadership team. The approach Brendan took was to empower everybody throughout the race and the goal was to get to a point where Brendan was redundant on deck and he could concentrate on everything else, the weather routing and the navigation.

A true team leader plays an important role in guiding the team members and motivating them to stay focused. One who sets a goal and objective for the team. Every team is formed for a purpose.
The leader alone should not set the goal, suggestions should be invited from one and all and issues must be discussed on an open forum. He must make his team members well aware of their roles and responsibilities. He must understand his team members well. The duties and responsibilities must be assigned as per their interest and specialization for them to accept the challenge willingly.

Never impose things on them.
Encourage the team members to help each other. Create a positive ambience at the workplace. Avoid playing politics or provoking individuals to fight. Make sure that the team members do not fight among themselves. In case of a conflict, don’t add fuel to the fire, rather try to resolve the fight immediately. Listen to both the parties before coming to any conclusion. Try to come to an alternative feasible for all.

The following 5 reasons summarise the importance of teamwork and why it matters:

Teamwork motivates unity in the workplace
A teamwork environment promotes an atmosphere that fosters friendship and loyalty. These close-knit relationships motivate employees in parallel and align them to work harder, cooperate and be supportive of one another.

Individuals possess diverse talents, weaknesses, communication skills, strengths, and habits. Therefore, when a teamwork environment is not encouraged this can pose many challenges towards achieving the overall goals and objectives. This creates an environment where employees become focused on promoting their own achievements and competing against their fellow colleagues. Ultimately, this can lead to an unhealthy and inefficient working environment.
When teamwork is working the whole team would be motivated and working toward the same goal in harmony.

Teamwork offers differing perspectives and feedback
Good teamwork structures provide your organization with a diversity of thought, creativity, perspectives, opportunities, and problem-solving approaches. A proper team environment allows individuals to brainstorm collectively, which in turn increases their success to problem solve and arrive at solutions more efficiently and effectively.

Effective teams also allow the initiative to innovate, in turn creating a competitive edge to accomplish goals and objectives. Sharing differing opinions and experiences strengthens accountability and can help make effective decisions faster, than when done alone.

Team effort increases output by having quick feedback and multiple sets of skills come into play to support your work. You can do the stages of designing, planning, and implementation much more efficiently when a team is functioning well.

Teamwork provides improved efficiency and productivity
When incorporating teamwork strategies, you become more efficient and productive. This is because it allows the workload to be shared, reducing the pressure on individuals, and ensure tasks are completed within a set time frame. It also allows goals to be more attainable, enhances the optimization of performance, improves job satisfaction and increases work pace.

Ultimately, when a group of individuals works together, compared to one person working alone, they promote a more efficient work output and are able to complete tasks faster due to many minds intertwined on the same goals and objectives of the business.

Teamwork provides great learning opportunities
Working in a team enables us to learn from one another’s mistakes. You are able to avoid future errors, gain insight from differing perspectives, and learn new concepts from more experienced colleagues.

In addition, individuals can expand their skill sets, discover fresh ideas from newer colleagues and therefore ascertain more effective approaches and solutions towards the tasks at hand. This active engagement generates the future articulation, encouragement and innovative capacity to problem solve and generate ideas more effectively and efficiently.

Teamwork promotes workplace synergy
Mutual support shared goals, cooperation and encouragement provide workplace synergy. With this, team members are able to feel a greater sense of accomplishment, are collectively responsible for outcomes achieved and feed individuals with the incentive to perform at higher levels.

When team members are aware of their own responsibilities and roles, as well as the significance of their output being relied upon by the rest of their team, team members will be driven to share the same vision, values, and goals. The result creates a workplace environment based on fellowship, trust, support, respect, and cooperation.

Final thoughts
Leadership is a necessary element to promoting teamwork in an organisation. When leaders are great, there is a lot of positive teamwork and many benefits. However, when leaders are poor there can be negative consequences that are completely opposite to the benefits of teamwork.

In business, leaders have the responsibility to do what they reasonably can to promote a good team environment. Practicing team-oriented leadership strategies can do a lot to usher in a sense of teamwork among professional team members. It is up to the leaders to make sure teams are functioning to their highest capacity. Although it sounds like a large responsibility, the benefits of promoting teamwork are incredible!

Henry Ford once said:

“Coming together is a beginning; keeping together is progress; working together is success. Failure is simply the opportunity to begin again, this time more intelligently. Whether you think you can, or you think you can’t – you’re right. Anyone who stops learning is old, whether at twenty or eighty.”

Have we forgotten leadership and the foundation of business planning?

One of the questions I hear frequently from emerging and current leaders is this one: “How has leadership changed from 10 years ago and what do I need to understand about running a successful enterprise that I don’t know today?”

Well the reason is simple: only 14 Percent of CEOs Have the Leadership Talent to Execute Their Strategy.

The data in Global Leadership Forecast 2018 shows that organisations with effective leadership talent outperform their peers. Yet very few organizations manage this high-value asset in an integrated, cohesive way.
Even after spending more than $50 billion annually* on developing their leaders, many companies still don’t have the bench strength to meet their future business goals. And despite the spending, investments are often fragmented and see a lack of returns.
Leadership models and development programs abound; few ties to business goals. Worse yet, there’s scant evidence that they actually work. What’s needed is a coherent, integrated leadership strategy.
A well-crafted blueprint ensures that companies have the right talent, at the right cost, and with the right capabilities to deliver today and into the future. Yet, this report found less than one-third of the HR professionals surveyed feel their organisations have an effective leadership strategy. Companies that do have such strategies in place report better returns on their investment in talent. They consistently feature deeper leader bench strength and stronger leaders at all levels.

Many leaders are living under an identity crisis. They are uncertain about how to lead in a more diverse, transient, multigenerational environment that requires them to embrace diversity of thought – and they fail to see the potential opportunities this represents to both workplace and marketplace success.

When leaders become too comfortable with a one-size-fits-all approach to leadership, they conversely become uncomfortable with the uncertainty and change that more successful leaders embrace as part of the job. Complacent leaders are at risk of becoming irrelevant because they are unable or unwilling to course correct their style, approach and attitude to the environment of change they must lead through.

Leaders fail in their primary role and responsibility of enabling the full potential in people and the business they serve because they don’t know the difference between substitution and evolution. Instead of leading the organization and its people to continually evolve, they get stuck in a cycle of complacency and the substitution of activities associated with it. As a result, the company cannot grow or its growth cannot be sustained.

The result is a major shortfall in competent, clued up global leaders.

According to a 2017 report by Price Waterhouse Coopers, 75 percent of hiring managers believe leadership skills are hard to find in new recruits. And a Deloitte study found a whopping 87 percent of companies aren’t effective at building global leaders.

What could be more vital to a company’s long-term health than the choice and cultivation of its future leaders? And yet, while companies maintain meticulous lists of candidates who could at a moment’s notice step into the shoes of a key executive, an alarming number of newly minted leaders fail spectacularly, ill prepared to do the jobs for which they supposedly have been groomed.

Look at Coca-Cola’s M. Douglas Ivester, longtime CFO and Robert Goizueta’s second in command, who became CEO after Goizueta’s death. Ivester was forced to resign in two and a half years, thanks to a serious slide in the company’s share price, some bad public-relations moves, and the poor handling of a product contamination scare in Europe.

Or consider Mattel’s Jill Barad, whose winning track record in marketing catapulted her into the top job—but didn’t give her insight into the financial and strategic aspects of running a large corporation.

Ivester and Barad failed, in part, because although each was accomplished in at least one area of management, neither had mastered more general competencies such as public relations, designing and managing acquisitions, building consensus, and supporting multiple constituencies. They’re not alone. The problem is not just that the shoes of the departed are too big; it’s that succession planning, as traditionally conceived and executed, is too narrow and hidebound to uncover and correct skill gaps that can derail even the most promising young executives.

However, Harvard Business School released some research into the factors that contribute to a leader’s success or failure, the findings found that certain companies do succeed in developing deep and enduring bench strength by approaching succession planning as more than the mechanical process of updating a list. Indeed, they’ve combined two practices: succession planning and leadership development, to create a long-term process for managing the talent roster across their organisations. In most companies, the two practices reside in separate functional silos, but they are natural allies because they share a vital and fundamental goal: getting the right skills in the right place.

A final thought: to succeed in the 21st century workplace and marketplace, leaders must come out from under their identity crisis and embrace diversity of thought so that those they lead can overcome their own identity crises and reach their full potential. They must embrace risk and change as opportunities that others may fail to see as such. And they especially must understand the difference between substitution and evolution: one leads to the trap of complacency, the other leads to a path of growth and continued success. In the end, the wise leader knows their subject matter expertise and specifically what their leadership (identity) solves for – in support of the organisation’s evolution.

Perhaps the underlying lesson is that good succession management is possible only in an organisational culture that encourages candor and risk taking at the executive level. It depends on a willingness to differentiate individual performance and a corporate culture in which the truth is valued more than politeness.

A.P. J. Abdul Kalam once said:

“When we tackle obstacles, we find hidden reserves of courage and resilience we did not know we had. And it is only when we are faced with failure do we realise that these resources were always there within us. We only need to find them and move on with our lives.”

Guest-blog: Roger Phare – A Nod to the NED – the key dynamic of the modern board

We welcome back Roger Phare as our guest-blogger, who is an accomplished Global Executive Director, equipped with a commanding track record over the past 37 years of bringing sound judgment and a strong commercial perspective to IT businesses, from ‘Mainframe to Mobile’.

Roger has been fortunate to have been part of the commercial computing lifespan. With a market-driven approach, which he has strategically supported, a number of organizations, both at significant Board, Executive and Regional Directorship and responsibilities. An expert in corporate governance and compliance and risk management; enjoying challenging the status quo and providing independent advice to Boards whilst maintaining sound judgment, impartiality and with integrity.

In the third of this series (view Part I and Part II ), we are going to look at the role of the Non-Executive Director (“NED”), which is a highly debated subject in today’s modern board.

To provide some background, before I hand you over to Roger, as an Independent Non-Executive Director and Executive Advisor on several companies, I talk with experience across the list of attributes required of a non-executive director, which is so long, precise and contradictory that there cannot be a single board member in the world who fully fits the criteria.

They need to be: supportive, intelligent, interesting, well-rounded and mature, funny, entrepreneurial, steady, objective yet passionate, independent, curious, challenging, and more. They also need to have a financial background and real-life business experience, a strong moral compass, and be first-class all-rounders with specific industry skills.

Chairmen and chief executives should use their NEDs to provide general counsel – and a different perspective – on matters of concern. They should also seek their guidance on particular issues before they are raised at board meetings.
Indeed, some of the main specialist roles of a non-executive director will be carried out in a board sub-committee (particularly the remuneration and audit committees), especially in listed companies.

The key responsibilities of NEDs can be said to include the following:
Strategic direction
As ‘an outsider’, the non-executive director may have a clearer or wider view of external factors affecting the company and its business environment than the executive directors.
The normal role of the NED in strategy formation is therefore to provide a creative and informed contribution and to act as a constructive critic in looking at the objectives and plans devised by the chief executive and the executive team.

Monitoring performance
Non-executive directors should take responsibility for monitoring the performance of executive management, especially with regard to the progress made towards achieving the determined company strategy and objectives. They have a prime role in appointing, and where necessary removing, executive directors and in succession planning.

Remuneration
Non-executive directors are also responsible for determining appropriate levels of remuneration of executive directors. In large companies, this is carried out by a remuneration committee, the objective of which is to ensure there is an independent process for setting the remuneration of executive directors.

Communication
The company and its board can benefit from outside contacts and opinions. An important function for NEDs, therefore, can be to help connect the business and board with networks of potentially useful people and organizations. In some cases, a NED will be called upon to represent the company externally.

Risk
NEDs should satisfy themselves on the integrity of financial information and that financial controls and systems of risk management are robust and defensible.

Audit
It is the duty of the whole board to ensure that the company accounts properly to its shareholders by presenting a true and fair reflection of its actions and financial performance and that the necessary internal control systems are put into place and monitored regularly and rigorously.
A NED has an important part to play in fulfilling this responsibility, whether or not a formal audit committee (composed of NEDs) of the board has been constituted.

Now I would like to hand over to Roger!

Thank you, Geoff, today I would like to discuss the role and ‘A Nod to the NED – the key dynamic of the modern board’.

Of all the Board positions the Non-Executive Director (NED) role is undoubtedly the most confusing. Not so much as to the expected outcomes of growth, compliance, shareholder returns and social responsibility but more as to the background and dynamics of the modern NED.

Why confusing?

Surely the NED role is the most historically formulated, culturally cultivated and legislatively defined of all board member roles.

Yet instead of being well defined and well-structured the NED requirement seems to be all over the place.

Part of the issue is that demand has rapidly increased due to factors such as legislation, compliance and business growth. This has spread the net further afield and created a demand over and above the previous norm.

The result of this demand there has seen “NED Membership” organizations springing up. I recently read as part of a membership promotion the following excerpt:

“If you have the right amount of experience to offer, you could become a Non-Executive Director. This could be an especially good option if you are approaching retirement because it can be a useful way to earn money without the pressures of being involved in the day-to-day decision making of a business.”

Whoa! This conjures up images of geriatric un-prepared old-boys rolling up for a four-hour board meeting; pontificating and story-telling before retiring to their local club for a large brandy and an afternoon nap in a dark leather padded armchair!

Nothing could be further from the truth for the modern NED. Guidance around “day to day” decision making is a critical part of the NED role. Four hours in the Boardroom can equate to four days spread pre and post-meeting guiding and assisting the CEO & executive team. It is serious business.

A related problem is that somehow a “one size fits all” approach to NED requirements has become the prevailing attitude. Other than “Chair” type roles it seems that there is little demarcation in the nature of the role nor organization in which the NED is required.

Contributing to this is the definition of organization types. Most understand the concept of listed or private organizations and the duties, responsibilities and remuneration levels required by and from the NED’s. When community organizations are brought into the mix then things really go off the rails.

It starts with the concept of “Not for Profit”, equating with the concept that NED roles being “Volunteer”. To start with, Not for Profit organizations should be re-branded “Not for Dividend”. In other words, they need to be governed and run the same way commercial organizations operate with a view to making a surplus; the only difference is that those surpluses are distributed to beneficiaries rather than shareholders.

This topic is probably the subject of a whole new thread but the point is that community organizations need directors with the same level of skill and due diligence as those in the commercial world.
The question is when an ad appears that asks for applications for a NED “Volunteer, expenses only”, who is going to apply?
Yes, there is a small percentage of experienced and talented individuals who are prepared to provide their time on a “pro bono” basis and these people are to be commended. Simply having time on one’s hands and looking for an activity is not necessarily a qualification for a board position.
Even worse, to a degree, is the concept of applying for volunteer positions to “gain experience” as a Board member. This can lead to frustration and disappointment for all parties.

Yet it is not all doom and gloom. Demand for high-quality Non-Executive Directors is increasing and it is generally acknowledged that the keys to success are the right recruitment, support, training and ongoing engagement. With these factors in place, NED’s can add significant value to all types and size of business.

So, here’s a nod to the new breed NED – exciting times ahead!

Roger Phare

You can contact Roger Phare via LinkedIn: Roger Phare on LinkedIn
or by email:
roger phare @ gmail .com
(remove all spaces)

Does shareholder value rule business?

What is the purpose of a corporation?

It’s remarkable that after a century of management theorising, there is no agreed upon answer.

Common-sense tells us that the purpose of a business is to make money.
A conversation with almost any businessman or economist shows it to be so.
Why else would a company be in business? Many experts agree: The Economist has recently declared that the goal of maximizing shareholder value, i.e. making money for shareholders, is “the biggest idea in business.” Today, “shareholder value rules business.”

Yet two distinguished Harvard Business School professors – Joseph L. Bower and Lynn S. Paine – recently declared in Harvard Business Review that maximizing shareholder value is “the error at the heart of corporate leadership.”
It is “flawed in its assumptions, confused as a matter of law, and damaging in practice.”
Bower has long held this view: back in 1970, he told NPR that maximizing shareholder value was “pernicious nonsense.”

Jack Welch, who in his tenure as CEO of GE from 1981 to 2001 was seen as the uber-hero of maximizing shareholder value, has been even harsher.
In 2009, he famously declared that shareholder value is “the dumbest idea in the world. Shareholder value is a result, not a strategy… your main constituencies are your employees, your customers and your products.

Managers and investors should not set share price increases as their overarching goal… Short-term profits should be allied with an increase in the long-term value of a company.”

But despite these denunciations, the “pernicious nonsense” of shareholder value has spread.
Shareholder value thinking, say Bower and Paine, “is now pervasive in the financial community and much of the business world. It has led to a set of behaviours by many actors on a wide range of topics, from performance measurement and executive compensation to shareholder rights, the role of directors, and corporate responsibility.”

There are thus two opposing schools of thought: Shareholder value is either the best idea in business and the worst idea in the world. Which is it?

Corporate strategy on the other hand, is the overall plan of contemporary management practice, CEOs have been obsessed with diversification since the early 1960s, because almost no consensus exists about what corporate strategy is, much less about how a company should formulate it.

A diversified company has two levels of strategy: business unit (or competitive) strategy and corporate (or companywide) strategy.
Competitive strategy concerns how to create competitive advantage in each of the businesses in which a company competes.
Corporate strategy concerns two different questions: what businesses the corporation should be in and how the corporate office should manage the array of business units.

Corporate strategy is what makes the corporate whole add up to more than the sum of its business unit parts.
The track record of corporate strategies has been dismal.
A study of the diversification records of 33 large, prestigious U.S. companies over the 1950–1986 period, found that most of them had divested many more acquisitions than they had kept.
The corporate strategies of most companies have dissipated instead of created shareholder value.

The need to rethink corporate strategy could hardly be more urgent. By taking over companies and breaking them up, corporate raiders thrive on failed corporate strategy.
Fueled by junk bond financing and growing acceptability, raiders can expose any company to takeover, no matter how large or blue chip.

Recognising past diversification mistakes, some companies have initiated large-scale restructuring programs. Others have done nothing at all. Whatever the response, the strategic questions persist. Those who have restructured must decide what to do next to avoid repeating the past; those who have done nothing must awake to their vulnerability. To survive, companies must understand what good corporate strategy is.

Many post-Enron discussions about corporate governance have focused almost exclusively on the responsibilities of directors and the structure of boards and shareholders.
This is hardly surprising – after all, a company’s survival ultimately depends on the effectiveness of its board’s decision-making processes.
But boards don’t exist in a vacuum. Ultimately, board structures and decision-making cultures will depend on a company’s unique circumstances.
Large companies may also operate different levels of boards throughout their businesses. The complexity of large international organisations with many subsidiaries makes the issue of management information and decision-making more complex, and the need for directors of such vast organisations to have early-warning systems is a must.

The board of directors in any organisation is responsible for its operational, strategic and financial performance, as well as its conduct.
Boards exercise their responsibilities by clearly setting out the policy guidelines within which they expect the management to operate. They will set out the short- and long-term objectives of the organisation and a system for ensuring that the management acts in accordance with these directions.

They will also put procedures in place for measuring progress towards corporate objectives. There is therefore a clear difference between the main responsibilities of directors and managers.
In his recent book, “Corporate Governance and Chairmanship: A Personal View”, Sir Adrian Cadbury distinguishes between direction and management: “It is the job of the board to set the ends – that is to say, to define what the company is in business for – and it is the job of the executive to decide the means by which those ends are best achieved.”
They must do so, however, within rules of conduct and limits of risk that have been set by the board.

Can your board answer the following strategic questions:

· Who are our stakeholders?
· What are our stakeholders’ stakes?
· What opportunities and challenges do stakeholders present?
· What economic, legal, ethical, and social responsibilities does our organisation have towards our various stakeholders?
· What strategies or actions should we take to best manage stakeholder challenges and opportunities?
· Do you have a system for managing relationships with stakeholders?
· How do you measure results? What metrics do you use to assess and gauge stakeholder relationships?
· In a crisis how quickly can you communicate with your relevant stakeholders?
· Do you know the various methods to engage with stakeholders and when not to use it?
· Can you state how much you are spending on each stakeholder group and what your ROI is?
· Have you developed a set of rules and practices on how best to manage the process of building stakeholder reputation with each stakeholder group?

Once you have answered the above questions, then you should attempt these:

I. What strategies or actions should our firm take to best manage stakeholder challenges and opportunities?
II. Should we deal directly or indirectly with stakeholders?
III. Should we take the offense or the defence in dealing with stakeholders?
IV. Should we accommodate, negotiate, manipulate or resist stakeholder overtures?
V. Should we employ a combination of the above strategies or pursue a singular course of action?

Shareholder value: Has been called the driving force of 21st-century business.

What value do shareholders bring to the companies they invest in? Are most shareholders interested in what is best for the company, or are they in it only for the financial performance of the company’s shares?

Regenerative Capitalism is an alternative framework for capitalism that embodies a deeper purpose than merely optimising financial returns, with the goal of promoting the long-term health and well-being of our human communities and the planet.
Aligned with our latest understanding of how the universe actually works, the collaboratively created framework illuminates eight key principles backed by solid science and transdiciplinary scholarship.

Adam Smith, the founder of capitalism, said that everyone should do what is best for themself.
However, Professor Nash, portrayed in the movie “A Beautiful Mind”, starring Russell Crowe, stated that “Adam Smith was wrong!”
Commercial organizations can only succeed if everybody is doing what is best for themselves while simultaneously doing what’s best for the whole group.

Beginning in the 1990s, we witnessed extreme egocentric behavior among public companies who were motivated solely by their own financial gains. Several studies prove that self-centered and egocentric companies perform poorly as compared to companies who focus on developing innovative products, delivering value for the customer, and motivating their employees to be more productive and successful.
How can these companies deliver value to their customers or suppliers if they are only looking at their own bottom line? Too much focus on shareholder value, measured by quarterly reports, is one of the primary reasons that public companies are not realizing their full potential and that the West has been in financial chaos for the past six years.
Companies that outperform the rest – over time – build their success on a performance-based culture, driven from the outside in.

Most executives agree that it’s important to create value for the customer. The problem is that despite the good intentions of the senior management team, this mindset often doesn’t travel farther than the company core values posted in the reception lobby of the corporate headquarters.
You know the classic four: honesty, engagement, customer focus, and collaboration.
If you exchanged one company’s value statement for the values posted in the lobby of the corporate headquarters across the street, would anyone notice? Or are the values posted in the lobby of the neighboring company the same four?

Professor Solow, winner of the Nobel Prize for his theory on economic growth, found that only a portion of financial growth in the world comes from companies making money out of money.
Instead, the majority of financial growth comes from companies actually producing a product, developing a new service, or changing the way we conduct business.
Corporate leaders need to do more than shuffle numbers on a balance sheet.
Consider Steve Job’s unrelenting focus on product innovation and what Apple was able to achieve by creating the iPad, iPhone, and iPod. As we know, iTunes has literally changed the entire music industry!

The obsession with maximizing shareholder value has also impacted the way that companies approach negotiations with their customers and suppliers.

To solve the world’s economic crisis, we need brave CEOs and leaders to step up and declare, “I don’t care what the share value will be for the next two years. We might not make a profit during this period. But we are going to focus all our resources on product research and development with the goal to create the best product the world has ever seen.
We’re here to change the world! We are fully committed to delivering value and a return on investment to our shareholders. Yet it may not be in the next 30 days or even the next three quarters. I am asking our investors to look at us with a long-term view. I am asking them to stand by us and risk a much larger return on their investment if they will agree to fund the innovation required to develop a market-changing product.”

If you left Sharpies under the statement of core values that hangs in the lobby of your company, what kind of graffiti would you find scribbled on your values statement? What would your customers and suppliers write? Your corporate values are better articulated by your employees, customers, and strategic partners than by your management team and board of directors.
If there is a disconnect between your formal statement of values and the graffiti, you have work to do.

If you can build a product that will truly change the world, like Steve Jobs did several times, your shareholder value will take care of itself. Your problems will be protecting your distribution channels, defending your intellectual property, and retaining your talent. Which set of problems would you prefer? I think the answer is obvious – to hell with shareholder value.

Experience tells us that listening to your stakeholders and strive to meet their expectations—difficult or not.
Ensuring they are feeling heard, valued, and appreciated grows trust, support and credibility. Building relationships and understanding motivation takes time and effort but will make your job easier in the long run. Companies are more successful when everyone is on board and on the same page!

A famous quote by Dennis Muilenburg:

 “As we continue to drive the benefits of integrating our enterprise skills, capabilities, and experience – what we call operating as ‘One Boeing’ – we will find new and better ways to engage and inspire employees, deliver innovation that drives customer success, and produce results to fuel future growth and prosperity for all our stakeholders.”