I recently facilitated at an event entitled ‘Thinking The Unthinkable’, where an elite group of luminaries were invited to discuss if, and how, corporate leadership needs to change in the face of hitherto unforeseen happenings that are disrupting not only the world in which we live, but also the world in which we work.
Speaking at the event were the authors of a report on this topic Nik Gowing and Chris Langdon, who’s research to date has concluded that, amongst other findings, “Unthinkable” events since 2014 have revealed a new leadership fragility at the highest levels and the pace of change in 2016 shows that the uncertainties are greater than ever. Is this the “new normal?”
The discussion aimed to explore whether the ‘luminaries’ (leaders from business and the armed forces) feel that businesses and leaders are adequately prepared for events that are unforeseen, unthinkable or even unpalatable!
Views were varied and spanned a spectrum from, “Unforeseen events have been happening from the beginning of time and we wouldn’t be here if we hadn’t coped”, to a sense that the overwhelming knock on geopolitical effect caused by conflict in the Middle East and mass migration had left the business world searching for answers!
One of the most interesting points made was about how Risk Functions in the majority of organisations are focused on risks associated with the 2008 global financial crisis e.g. financial risk, regulatory risk and reputational risk.
Research indicates that 80% of organisations place little or no focus on strategic risk. i.e. Risks associated with their current products, strategy and market position.
Whilst unthinkable events inevitably affect strategy, it’s the inability of organisations and leaders to disrupt themselves that is a potential show stopper in the digital age.
US headquartered giants such as Blackberry and Blockbuster were cited as examples of companies who patently failed to manage strategic risk. They held on to a belief, until it was too late, that their products and services would be valued in the long term. The stark reality is that Blockbuster were valued at $4.8 billion in 2000 and filed for bankruptcy in 2010!
Disrupting their business model would have meant purchasing Netflix which they were offered for $50 million in 2000.
Blockbuster is a prime example of how human beings and organisations are prone to cognitive dissonance or the state of having inconsistent thoughts, beliefs, or attitudes, especially relating to behavioural decisions and attitude change when facing up to outcomes they would rather ignore.
In short – leaders and organisations need to urgently develop new mindsets, cultures and behaviours or the unthinkable may just happen to them.
If you would like to know more, get in touch with us for a free consultation on how we can help your business performance and strategy.
Darrell Burberry – Natural Direction Facilitator
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