Damned If We Do or Don’t: The Decision Paralysis of Large Organisations
The digital age has brought about somewhat broad definitions of leaders and laggards as the race towards dominance in the new binary landscape unfolds. Fall within the prior group and you’re only somewhat safe from the threats of ever-lurking disruption. Considered a laggard and you’ve got little if any chance of surviving the digital jungle that threatens to mortally wound even the most well-established business.
It’s a case of shape up or ship out as younger, more nimble and tenacious challengers arise from an uncertain terrain, ready to do battle and dethrone hitherto dominant operators.
Interestingly however, such blunt wake up calls, coupled with the countless reports, studies, anecdotes, soundbites, projections and statistics involving digital transformation are producing a mixed bag of reactions from “the top”.
It appears that many decision-makers are feeling at least a little disoriented in their new surroundings and left almost incapable of making any discernible move to hold their ground against new challengers. But perhaps it is too early to distinguish between the leaders and laggards in a time of such uncertainty. After all, leadership in the event of major uncertainty requires more than a knee jerk reaction and a good measure of circumspection.
Having the courage not to follow the crowd is another virtue that can serve you well. Yet, the truth about humans is that most tend to calculate their best response to an uncertainty by mimicking the reactions of others. This almost intuitively seems like a bad idea in the given context.
“Uncertainty is not an indication of poor leadership; it underscores the need for leadership.”
– Andy Stanley
So how does a seasoned and battle-weary old guard fend off threats from a young, bright-eyed and sometimes annoyingly bushy-tailed startup generation that so relentlessly pushes the transform or die doctrine?
Well, incumbents happen to have much stacking in their favour: customers, historic data, an often well-established brand, financial resources and experience that come with being in the trenches for years. Further, these companies have the same access to all the technologies, trends and ideas their millennial counterparts do, making it appear all the more that the odds are indeed stacked in their favour.
But what these companies don’t seem to have is the mindset that permeates the typical startup company or entrepreneurial thinker. For all their wealth in tangible resources, established companies come with established norms and established cultures that are hard to break through. People tend to hold on the familiar in the face of widespread change and look to their chains of command for their next move. In turn, decision-makers who are unwilling to let go of their place in the hierarchy depend on the existence of such chains of command to sustain their positions.
“An open-minded and diverse population that readily shares information, encourages experimentation, accepts failures and dispenses with formality and hierarchy is what makes Silicon Valley the successful hub that it is.”
– Vivek Wadhwa
And who can blame them? In reality, flattened hierarchies and democratised decision-making may sound like the stuff of a socialist utopia, but as we know, these lofty ideals don’t always translate well in reality. This is perhaps what is leaving so many decision-makers inert when it comes to leading in the new digital space. Bartering the certainty and comfort that comes with tightly structured chains of command for the unknowable outcomes of dispensing with formalities might just be too big of an ask.
So Where to From Here, Captain?
According to Sabine Bendiek, CEO of Microsoft Germany. “Digitization, which should enable all progress, must also include all people. It is important to use the positive mood of the employees, to actively counteract fears and to point out future opportunities for all. This is best achieved in a culture of trust in which employees are actively involved in the transformation process.” This quote, coming from one of the world’s biggest software companies, encapsulates both the fears and opportunities that are keeping change averse leaders up at night.
The idea that you’re damned if you do or damned if you don’t seems to be paralysing companies from making any decisive move towards transforming the hierarchies that no longer serve their best interests. One thing’s for sure though; there isn’t a heck of a lot of time left for circumspection and those that dig their heads in the sand will inevitably face the realities of disruption, even if digging their heads in the sand delays that disruption for just a little longer.
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