This year, BSL is 30. Thirty is a good age for reflection: not too old to dwell overly on the past, but yet with a lot of learning under its belt upon which to build the future. Because after all, BSL is both a learning institution and a future-thinking organization. BSL’s Aileen Ionescu-Somers reflects on new ways of doing business and the requisite leadership qualities for the future.
So many organizations, even the best minds out there, find it very difficult to predict the future. History is rife with poor predictions. The most glaring case in recent memory, though (apart from certain presidential elections!), was evidenced by a declaration by the IMF in 2007, just before the 2008 financial collapse, when the IMF declared: “Overall risk to the (world economic) outlook seems less threatening than six months ago.” Not only did the IMF get it wrong. Most of the world’s multitude of economists, financiers, leaders and governments also did.
In some ways, this is a direct result of globalization. With it, the world became more complex and change accelerated. All the indicators show that the future will be even more unpredictable and uncertain than before. Yet, business does not like uncertainty. Uncertainty is associated with fear, anxiety and pessimism. Uncertainty can be the bearer of bad news. Stock markets are allergic to uncertainty. Business executives in global multinationals work so hard on cancelling out uncertainties that a senior executive told me once that “innovation does not come from big companies”, and that new ideas and “out of the box” innovations are often dead in global corporations before they are born.
Uncertainty breeds risk averse corporate cultures and risk mitigating instincts amongst managers. And the consequence is that we forget about the opportunities out there. Despite the feeling that there is a lot of bad news around, there are great things happening in the world. It is not fake news that life expectancy is still increasing. It is not fake news that income continues to go up for most of the world’s increasing population, and that illiteracy and poverty levels continue to go down.
These positive developments are actually huge opportunities for unleashing future potential for technological opportunity and development. And indeed, nowadays, much innovation is driven by technology. How accessible technology has become for ordinary citizens in my lifetime! The pace is set to increase exponentially over the course of our BSL student’s lifetimes. The future offers huge opportunities, giving future generations an unprecedented ability to do everything in new ways.
However, the down side is that with growing inequality, increasing numbers of now angry and vocal people feel left out. Indeed, they are either choosing not to participate – or are not empowered to participate – in building a better and more inclusive society. Another downside is the growing fragility of the complexity we have created in the world. When what happens in one place very rapidly affects everything else, this is what we call systemic risk.
System risks can convert into real life situations and then the system can start to break down; this is what we call systemic shock. By now, we have all either observed or experienced systemic shock first hand. We see it in financial crises, health risks such as ebola/pandemics, and in the major challenges related to migration in today’s world. Today, systemic risks and shocks are set to become much more virulent because of the interweaving of societies and sub-systems, re-enforced by technologies and accelerated by “just-in-time” management systems that push resilience and responsibility to its limits. As a result, the new realities we are living with are collapsing biodiversity, climate change, more pandemics, more financial crises…and ever more destructive systemic shocks.
Therefore, we need a new awareness of how to deal with these new realities. We need to understand how we can mobilize ourselves differently and come together as a community to manage systemic risks. We need to lessen the negative impacts of systemic shock and capture business opportunity for the greater good of society and celebrate new ways of doing business. How do we weave this complex tapestry together? How do we think about complex systems in entirely new ways? That is not only the challenge of scholars, but it is the challenge of all individuals engaged in thinking about the future. Business leaders are no exception.
Since business leaders are pragmatic, they need both frameworks and tools to guide their thinking. The UN Sustainable Development Goals (SDGs), for example, present business with a framework for understanding and mitigating future systemic risk. Our BSL students are more than familiar with the SDGs, and what they represent. They are also familiar with the Gap Frame research, the conceptual basis for BSL’s thought leadership. The Gap-Frame is a normative framework that translates the SGDs into relevant issues and indicators for business. This BSL/University of St. Gallen research provides companies with a tool that helps translate the SDGs into workable steps to manage systemic risks around globalization more effectively and to achieve specific targets and objectives.
So the conceptual research at BSL closely relates to the SDGs, and I hope I have made the point that the SDGs relate to both systemic risk and shock mitigation. But they also relate to business opportunities. The SDGs are an underlying theme for the BSL Gap Frame Innovation Week (GFW) which we ran 4 times in the 2016/17 academic year. Indeed, some of our students and even our faculty are far from their comfort zones during those weeks. During the GFWs, our students choose a problematic global issue linked to the SDGs and develop a start-up or innovation initiative to contribute to dealing with the problem. The GFW presents our students with a small concentrated “piece of the action” on leadership learning for the future.
And what are the key facets of leadership learning for the future? There can be no doubt that professional business acumen and expertise are as important as they ever were, if not more. But a sense of purpose directed by an ethical compass and a developed sense of both local and global responsible citizenship are also key prerequisites. The latter leads to levels of global knowledge and understanding that are also essential to, I would say, the very survival of organizations of the future.
We have recognized at BSL that much leadership learning today is reasonably strong on developing hard business acumen and expertise, but focuses too little on multiple other essential albeit “softer” aspects of leadership learning. With this in mind, we can ask ourselves: What will be one of the most important traits of a future leader? I would say, “curiosity”. The global business leader of today has to have a high level of global knowledge and understanding. Without curiosity, we will not have an effective or indeed knowledgeable leader. The SDGs, the BSL Gap Frame research and the BSL Gap Frame Week, provide current and future business leaders with routes or paths to satisfy curiosity, take action on what is learnt, direct ethical compasses, glean global knowledge and understanding from local and global committed citizenship and – actually – to prepare our students for their future.
For example, during our last BSL GFW on governance issues, our activities brought deeper knowledge and recognition to our students that the world’s governance systems are fossilized and cannot begin to cope with the changes that are currently happening and that will happen in the future. To celebrate new ways of doing business for the future, we simply have to develop new ways of managing the planet collaboratively, using collective wisdom. As I have pointed out at the beginning of each GFW, truly amazing things can happen when individuals come together to change their future.
Author: Dr. Aileen Ionescu-Somers
Active in thought leadership, consulting, applied research, teaching and supervising DBA candidates in sustainability & responsibility.