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Peering into the Murky Crystal Ball – Part 3

In the final part of this special three-part series, Part 3 – The Imponderables, Executive Coach and freelance blogger for The Slade Report, David Simpson, offers some observations on the factors at play in determining the new normal. Catch up or recap here on Part 1 – The Inevitables and Part 2 – The Inconclusives.

The Imponderables

  1. Civic Unity or Selfish Disunity

Since the 50s we have seen a radical shift in attitudes about community. The reasons are many: changes in the nuclear family, urbanisation, greater media transparency, higher levels of education, multiculturalism and globalisation. “Shared values” have fragmented and once trusted institutions – government, the law, medicine, banking and church – have all come under fire. The meaning of good citizenship has changed. With the work day expanding and dual income families becoming the norm, time available for community involvement has evaporated. An obvious example is the membership decline of service clubs such as Rotary, Kiwanis and Lions.

It could be argued that human behaviour has been modified by technology (attention span, inward focus, susceptibility to web influence). It is hard to say if less human person to person contact leads to less empathy, but the time spent with individual handheld screens has certainly promulgated a first person/me first mentality.

One would hope that the COVID-19 crisis reminds us that we are all in this “humanity thing” together. It should have a bearing on how we manage the challenges of unemployment and what is deemed fair as the digital divide widens the gap between the haves and the have nots. The answer lies somewhere between full blown Socialism and Social Darwinism. Hopefully, enlightenment prevails over self-interest.

In the short term, I believe that we need to re-emphasise the subject of civics in our education system to teach what citizenship involves and why it is important.

  1. Environmental Action or On-going Inertia

The vast majority of the world’s inhabitants support more initiative on climate change. Whether most fully appreciate the cost or the effort required of real action is another matter. Powerful interests such as oil, auto and fast consumables wield significant influence in resistance. Putin’s oligarchs, the Saudi Royal Family and the likes of the Koch brothers are not going down without a fight. However, the collective action that has been required to get a significant percent of the global population to self-isolate for self-preservation may spur on a surge of activism in the sustainability movement.

Interestingly, the pandemic’s impact of virtualisation with downward pressure on petroleum use and overall consumption could be an unexpected first step in lowering of the global carbon footprint.

  1. Decline of America/Ascendancy of China

Trump has certainly done a good job burning off the goodwill the US has built up with its allies since 1945. America’s moral authority as crusader for democracy and guardian of the free world has been eroded in three and a half short years with poor statesmanship and bullying America First protectionism. It is hard to believe that the damage is irreparable if there is a return to more sane foreign policy and respected leadership. On the other hand, an extended Trump presidency could lead to a permanent loss of credibility as well as worldwide instability.

Despite being initially cast as the COVID-19 pariah, China is filling the foreign aid void left by America and is providing economic and technical assistance to the third world. Hey, they are even donating medical essentials to the US! Even if major trading partners push to repatriate some production, China will remain the global manufacturing and export powerhouse. If stoking of domestic consumption starts in earnest, it is only a matter of time before their GNP rivals the US. At the same time, the Chinese continue to build up military capability to offset the US as the international police force.

US sponsored democratic capitalism has always espoused the philosophy that a rising tide lifts all boats. It would be naïve to think that the People’s Republic has quite the same “win-win” attitude. China has shown they will follow their own path that is decidedly Chinese in its focus. If you dislike American hegemony, you will like the Chinese version even less.

  1. Globality or Nationalism

Have we reached the peak of globalisation or just a momentary pause? Given that we will undoubtedly be working through a recession at best, recovery not expansion will be the priority. The problems of supply chain and vulnerability to offshoring will stall any further plans to outsource overseas and the call to bring back jobs to address unemployment will be strong. The larger questions about consumerism – “Is it sustainable?” and “Can there be prosperity without growth?” – are likely to get more attention than they might have otherwise.

On the political side of globalism, does the lack of a coordinated approach to tackling the pandemic signal the need for greater cross border collaboration? Alternatively, do countries now conclude that they have no choice but to shut their borders and tend to their own backyard?

I hope it is a combination of both. Building redundancy into a worldwide health response capability must surely happen. The WHO or some repurposed alternative will have to be funded and provided the requisite authority to mitigate a disaster re-occurrence. It will require worldwide agreement (or at least consensus with the UN Security Council) to achieve it. Having something vitally serious to talk about in terms of collaboration is a real opportunity.

On the national level, I hope that this will finally get us discussing more seriously how oppositional politics have gone too far. Representing one’s supporters is a commitment, but not the exclusive one. In the most basic terms, elected officials are responsible to all citizens, not just the ones who voted for them. Building back the muscle memory of bipartisan cooperation
– at least in areas of general public interest (disaster relief, infrastructure)
– can only translate to better preparedness when crisis hits again. Here’s to the positive side of nationalism: We stand as nation together, but also as a willing member of the world family when necessary.

The fact that WFH has given me occasion to reflect on these matters encourages me to believe that better minds than mine are also thinking them through. It is said that you should never waste a good crisis.

 
I certainly hope that is true.

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Peering into the Murky Crystal Ball – Part 2

In Part 2 – The Inconclusives, the second in this special three-part series, Executive Coach and freelance blogger for The Slade Report, David Simpson, offers some observations on the factors at play in determining the new normal. In case you missed it, click here for Part 1 – The Inevitables.

The Inconclusives

  1. Objective Truth or Limbaugh’s Four Pillars of Deceit

The explosion of on-line information sources and the Balkanization of media reporting in the 24/7 news cycle has ushered in an era of “believe what you want to believe” versus a focus on objective truth (that is self-evident). Nowhere is this more apparent than in post Trump America, but greater reliance on partisan narratives is a worldwide phenomenon.

A significant portion of the US population believe academia, science, government and the fake news media are the enemy of the people, perpetrating hoaxes (like global warming) to limit personal freedom. Playing fast and loose with the “facts” has somehow been accepted as a part of modern life. Digestible sound bites have become the currency of political debate.

The notion of using technology as a filter to factor out bias in order to provide a truly objective reporting of the facts is an interesting one… but raises the following questions: “How many are actually seeking that objectivity?” and  “How many would remain perfectly comfortable having their own preconceptions reinforced?”

  1. Urbanisation or the Escape to the Country

Up until March it was a foregone conclusion that cities would continue to grow. Being under home lockdown, particularly in urban centres most vulnerable to the virus, has many of those in self-quarantine questioning the expense and inconvenience of big city living. As well, those who have decamped to more rural situations for distancing reasons have been reacquainted with the advantages of a slower pace.

If the move to a more virtual mobile lifestyle does in fact become a reality and workers are actively discouraged from commuting to their desks, the choice of domicile opens up. If you can work from anywhere and have anything delivered to your door, do you need to live in Detroit, Dusseldorf or Doha?

In this scenario the less salubrious urban centres will see an exodus of mobile workers. Those of cultural or historic significance like New York, Paris and Shanghai would likely maintain their appeal, but less as commercial hubs and more as experiential destinations (or idylls for the rich and famous).

  1. Domestication of Manufacturing

The world’s over reliance on China’s production capacity and the supply chain vulnerabilities that exist when a Wuhan occurs have been brought to light. This has led nations to start to challenge their assumptions about “just in time” inventory control, access to essential goods and services as well as the prudence of strategic stockpiling.

Ironically, the Trump MAGA cry of “I’m bringing back manufacturing jobs to America” may gain some broader currency courtesy of COVID-19. It seems unlikely that car making will return to Australia, steel plants to the US or cheap garment making to Italy. Nevertheless, the local production of small run, vital commodities like pharmaceuticals, food products and precision engineered components might become viable again if access to them is seen as critical. Resistance due to higher cost may be somewhat mitigated if high unemployment levels put downward pressure on labour rates. Having said that, with the advent of micro manufacturing, turnkey robotics and 3D printing, it is unlikely that such installations would require much physical manpower.

Continue reading: Part 3 – The Imponderables

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Peering into the Murky Crystal Ball – Part 1

In Part 1 – The Inevitables, the first in this special three-part series, Executive Coach and freelance blogger for The Slade Report, David Simpson, offers some observations on the factors at play in determining the new normal. David has been a past CEO of global organisations, working in cities across North America, South Africa, China, Japan and Australia. A little bit of distance is often a good thing, and now he also has time to recast lessons from the past and paint us some future scenarios.

What the world is going through currently is a once in a generation, if not a lifetime, occurrence. Historically tsunami-like impact events bring about significant change because they are a shock to the system. Odds are that the future won’t look like the old normal.

The following long form blog looks at the impact of automation on employment, the cost/benefit of urban living and the fragmentation/partisanship in representative government. These and other topics have been for conjecture for some time, but these and other questions have been brought into sharp relief by COVID-19.

To echo our mate, Peter Thomas, the COVID-19 pandemic has pushed several emergent social trends into hyper-drive. Given the world’s inability to cope comfortably with the pace of change, even before lockdown, predicting the outcomes of the “new normal” is exceedingly difficult. In order to make some sense of it for my own peace of mind, I am attempting to articulate some of the apparent dynamics at play and the perplexing questions they raise.

The Inevitables

  1. Institutionalisation of Unemployment

No matter the rate of recovery post COVID-19, the percent of jobless will remain high for some time. Sections of commerce (e.g. travel, retail) will be decimated and unable to hire. Other businesses contending with the public’s reduced appetite for consumption (see new depression mentality below) will need to manage cost and be hesitant to staff except where necessary. Additionally, the work from home experience has likely identified unnecessary areas of operation that can be shed, so many furloughed employees may not be asked back.

This is occurring at a time when the impact of AI and machine learning is starting to appear on the radar. The significant displacement of manpower in areas like transport due to self-driving vehicles and routine customer service delivery using intelligent bots is already anticipated. However, the professional ranks are not immune either. If a medical database with appropriate sensing tech can deliver a superior diagnosis or a virtual judiciary can deliver fairer and more reasoned verdicts, is there not going to be redundancy in the high paid ranks as well?

These may be considered distant development that will be resisted with scepticism because of a belief in the superiority of human intellect and the importance of face to face contact in important decision making. But after two months of isolation and the normalisation of Zoom interaction, the progression from telemedicine to avatar advice and counsel may have been given a kick along by the virus.

Whatever happens, we will need to refresh our thinking about people without jobs. It is hard to imagine new areas of endeavour that will come on stream to soak up those displaced by automation. If there are not enough paying jobs to go around, we will have to find ways to share the wealth or deal with massive civil unrest.

The number of people who would never have considered being on the dole, but have subsequently applied due to the lockdown, has exploded. A renewed appreciation for a social safety net is certain. The JobKeeper/JobSeeker programs portend to greater consideration of the basic minimum income concept, how it might be managed and how it could be funded.

  1. The New Depression Mentality

If the lessons of the late 1920s offer any insight, it is that a prolonged severe downturn leads the population to greater frugality. Boomers who have seen their super funds plunge will be more cautious. Gen X, Y and Millennials who have been encouraged to spend everything they earn will now have a real appreciation for the notion of “saving for a rainy day”.

In the short term, as many climb out from under credit card bills/overdrafts, they will, out of necessity, postpone or forego many normal routine purchases. This forced belt tightening may in turn habituate a predisposition to thrift.

On top of all this, the massive government debt incurred in coping with quarantine will necessitate a heavying up of the tax burden across the board so there will be less free cash flow along with a growing “save first” mentality. This in turn takes the consumption driver out of the economy limiting a V shape bounce back. On the upside, the availability of greater personal saving (no doubt sitting in “easy to access” savings accounts at zero interest) could make investment capital plentiful (and cheap) for growth industries.

  1. Accelerated Virtualisation

Experience with video conference as a way of communicating and working is now ubiquitous. Concerns about WFH productivity loss have been largely neutralised and caused many to question the cost/benefit of “being in the office”. The effect on office rentals, commuting and even residential location is potentially enormous.

Likewise, any resistance to e-commerce has been ploughed over with late adopters sampling Amazon, Uber Eats, Netflix and video yoga. The slow demise of bricks and mortar retail has been put into high gear with “on the margin” department stores like Myer and Nieman Marcus heading to the retail boneyard. There will many storefront causalities when the dust settles.

With the hammering that tourism has taken, it is conceivable that VR travel will come into its own. (i.e. “Walk along the Boulevards of Paris without the worry of infection from the French.”) Regulating intellectual property rights will become even more complex when digital service expands to virtual experience.

It goes without saying that the power of GAFA (Google, Amazon Facebook and Apple) along with other tech giants like Microsoft, Netflix and Alibaba has increased as a result of the shutdown. It is in their self-interest to be pushing virtuality even further. Anti-trust pressure will almost certainly be brought to bear, but if the busting up of Standard Oil is anything to go by, the component parts of these firms will become individually more powerful if demerged, basically defeating the purpose.

  1. Recognition of Systemic Faults

Clearly the pandemic has highlighted the world’s lack of readiness for a global health disaster. The response has been slow, mixed and uncoordinated. The WHO seems at the mercy of its major funders, under-empowered and overly focussed on third world Ebola type problems. There is some debate about whether the health experts had response plans in place. If so, they were ignored, or stripped of support and put on the back burner. In the wake of the crisis the scientific community has done a good job, sharing information and collaborating on solutions while treading the thin line of fact versus politic interest. The hope is that we learn from best practice and are better prepared for next time.

Perhaps the bigger vulnerability in crisis is the intensification of partisanship in Western democracy and the resistance to intra and inter-governmental cooperation. The US is the most obvious example of adversarialism, but Brexit and the bushfire relief response show that entrenched political divisions are not unique to America. China’s initial withholding of epidemiological information is classic “look after your own interests first” in a global context.

The willingness for ScoMo to engage with State Premiers effectively and the cooperating Democratic and Republican US Governors are certainly encouraging. But the mainstreaming of the populist radical right around the world and politically correct intransigence on the left are creating roadblocks to effective non-partisan action even when emergencies occur. Will the pandemic convince voters of the need for their politicians to cooperate more willingly for the overall public good? That is the billion-dollar question.

Continue reading: Part 2 – The Inconclusives

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Who you hire today, determines what is possible tomorrow!

Slade Group through its sister company TRANSEARCH International Australia, recently brought Dr John O. Burdett to Melbourne for a series of seminars on topics such as “How to measure culture”, “Tomorrow will be different – Will you?”, and “Why hiring the best candidate may be the biggest recruitment mistake you will ever make”.

On the last topic John says there are 3 undeniable truths about executive hiring – they are:

  1. The continuing lack of top talent is a major impediment to business growth.
  2. Far too few of those who make key selection decisions have been fully trained (or trained at all) in the hiring process.
  3. If you don’t know what you are looking for – only an optimist standing on stilts would believe that they might actually find it.

Considering the business risk involved – some recruitment decisions amount to betting the business – this is no small matter. Even if the hiring decision doesn’t amount to “betting the business” 20x annual salary is a good benchmark for the cost of getting it wrong.

Seven statements that (if any are true) strongly suggest that you need to revisit your approach to talent acquisition.

  1. Although we have a general sense of the culture we are moving towards, a more disciplined approach, e.g., a systematic assessment of where we are and where we need to be, is not something we have access to.
  2. Role-specific leadership competencies do not figure prominently in our hiring process.
  3. We have a job description and develop a specification for the position, but rarely do we build a robust scorecard.
  4. Few of those who make hiring decisions have been trained in conducting the evidence-based interview.
  5. We recognise the importance of the team but, for the most part, lack the tools to unbundle what sort of team we are hiring into.
  6. Rather than validate statements made during the interview, the reference check simply follows up on referees provided by the candidate.
  7. We invest time and effort in executive integration. What we lack is an integration workbook allowing leaders, who are new to the business, to take ownership of their own integration.

Who you hire today, determines what is possible tomorrow!

If you would like to discuss any of the above with me – please give me a call on 03 9235 5100 or email me at gslade@sladegroup.com.au.

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The two types of trust

Being genuinely interested in everyone you meet may be second nature to those of us in the executive search business, but contrary to the popular saying, the reverse isn’t always true. In London for an AESC conference recently, I met John Niland. John is best-known as a conference speaker on doing higher value work and for the last 15 years, has been coaching others to achieve success. He has a particular passion for supporting independent professionals to adapt and thrive in today’s challenging economies. In the following article he makes some valid points about the nature of trust – applicable to all of us, no matter what business you are in.

Geoff Slade

1. Cognitive trust and Affective trust

To win wholehearted trust from another person, you need to win both their head and their heart. However, not everyone we meet places equal reliance on these two faculties.

Some people (and cultures) are primarily cognitive. When building trust, they look for evidence that is factual: e.g. evidence of credibility, track-record, process, reliability, tangible results and useful insights. If you can answer their questions specifically (or guide them to ask better questions) then you build trust.

Other people (and cultures) are primarily affective. They first decide if they like you or not, then they listen to what you have to say. Bombarding them with evidence of your credibility is unnecessary and may even be counter-productive. Their decision to trust is intuitive rather than rational … and is often uncannily accurate. They take in your body language, your attentiveness to them and a host of non-verbal cues.

While most people will use both dimensions (i.e. cognitive and affective), in practice the majority of people have a tendency to rely more heavily on one dimension than the other. For example, in large organisations, the greater the likelihood that trust-building is cognitive… at least in northern Europe. But beware of stereotypes: I have come across senior managers in finance who build trust affectively, just as many freelance professionals are as cognitive as you can find on the planet.

In a team environment, affective trust tends to win out. If team members like each other, this generally makes for greater performance and mutual support than if they simply cognitively respect each other. However, in many teams, it’s worth noting that cognitive respect plays a big part in whether one professional likes another or not. So it’s always worth considering both dimensions… not just the one that most reflects you!

2. Trusting yourself

How do your build trust? Cognitively (via the head) or affectively (via the heart)? Which is your primary mode of trust-building?

Perhaps the person that it’s most important to trust is yourself. This is usually expressed as confidence: confident people have trust in themselves. Indeed, in some languages (such as French), the same word ‘confiance’ means both trust and confidence.

If a person is not particularly confident, then they struggle to trust themselves. So they furiously prepare for meetings, feel anxious in negotiations, worry about the future, avoid difficult conversations, postpone decisions, have difficulty with business-development and often with personal relationships, too.

Most people would agree that confidence is built though action, rather than by reflection. Certainly this is likely to be true for cognitive trust-builders. By creating their own track-record in dealing with scary situations, they see increasing evidence that they can trust themselves.

However, for those who build trust affectively (or intuitively), how do they deal with low self-confidence and lack of trust in themselves? In my coaching work, I see that affective trust-builders often have a harder time overcoming a poor reputation with themselves. Unlike the cognitive trust-builders, they cannot easily grow self-confidence through affirmative action… because they don’t like themselves very much to begin with.

Self-worth is about liking ourselves – with or without the evidence. It’s not the same as self-esteem and certainly not the same as confidence. It’s a fundamental pre-requisite for career-development, for charging better fees and raising the value of our work.

 

John Niland is a Brussels based management consultant. john@vco-global.com

This article was originally published on TRANSEARCH Executive Leadership Insights.

Republished with kind permission from TRANSEARCH International Australia.

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The 5 things keeping Senior Executives awake are not what you might think

What happens when you bring together a group of Australia’s top business leaders to consider the big issues? Current media headlines would have you think the TPP, China FTA, a lumpy economy, risk, governance, or the AUD would be front of mind.

In fact the headline challenges turn out to be multi-generational workforce management, the link between organisational culture and productivity, immigration, regional development, and security – both information and personal.

Economic growth, fresh political leadership and national security also featured in the discussion hosted by TRANSEARCH International Australia.

Less publicised issues also got a good hearing around the table; the debate from the over 50s corner heated up when the conversation focused on understanding the work expectations of the next generation: “We have a young team in their 20s… they’re so distracted by what’s on their phone!” and “Young women are driven, they are totally underestimated. They’re probably going to shock us all…” (46% of the participants at the TRANSEARCH Boardroom Lunch were women).

Are we too complacent about our security? Cyber security and bio security were perceived to be greater threats for Australia than brutal terrorism. The feeling around the boardroom table was that we are well protected but complacent.  Two CEOs with insider knowledge feel that at best we’re well protected, at worst we’re living in a fool’s paradise, blind to the Dark Side. A security expert amongst the group highlighted that executive protection is also soft in Australia: executives could be held for ransom as is common in other parts of the world. There’s also a very fine line between genuine concerns about security and those motivated by pitching fear based on xenophobia and racism.

A stable economic environment may have benefited professionals, but our group was careful to consider opportunities for those who also do a valuable job that is not ‘sexy work’. The truck drivers, process workers and administration employees who will be a necessary part of the future workforce.

Purpose and Meaning is understood to override salary and job titles, and many recognise that people need, regardless of their age “an understanding of where they fit in”. Brand, engagement and corporate culture, were some of the real reasons behind why people do what they do. We talked about creating very good ‘whys’ as a great way of attracting good people and engaging employees, regardless of generation stereotypes. The fact that some younger employees don’t worry so much about risk was also raised as a positive. It allows them to risk exploring new ventures and they are much quicker to recognise opportunities. As one participant said, “What a gift!”

On the subject of risk one executive stated, “I hold traditional values about personal privacy, but my son said to me, ‘technology has made privacy irrelevant.’”

Participants went on to talk about opening our borders and welcoming diversity at the executive table. We cannot underestimate the importance of finding the right immigration solution, they said. We need to consider populating our country with skilled and educated migrants, make resources available and provide humanitarian support to displaced refugees.

Focusing on regional centres, education was raised as a way of supporting regional growth. “Successful cities are diverse, safe educational centres. Education is something Australia does well,” it was said. Success stories, such as Deakin in Geelong and Monash in Bendigo mean more young people are making lifestyle choices to leave the big cities, or not to leave regional areas for the city.

In support of our bright young stars in Australia, we heard from one executive who was mentoring MBA students. These start-ups with their own businesses don’t have a lot of capital, but they are positive and have great ideas. Raising capital has been a problem, so where is the connection between entrepreneurs and investors? Some thought we need a Silicon Valley in Australia. All agreed employment growth will come from these new businesses, from those people who want to have a go. If we don’t support them, they will go abroad to places like the USA to get a break.

If you had any preconceptions about what’s been on the minds of our senior executives, I’m pleased to report it isn’t all negative. They do seem to be getting some sleep.

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