This week in our blog post series the native Indian and the US American World Business Dialogue Ambassador Harsh Dhanuka is sharing his thoughts about the meaning of Responsible Leadership during the Corona pandemic! Find out how he characterizes Responsible Leadership in the 21st century. Including how leaders should decide in complex and confusing situations, taking into account the interests of stakeholders, the environment, and society.
And also, why education is the best investment that any parent can make for their child according to his father and how it’s thriving him to make his life a journey of constant learning.
What does it mean to be a Responsible Leader in today’s world?
We all can fairly assume, we know what responsible means. After all, it’s a pretty common term. You’re financially responsible if you follow financial disciplines like budgeting, having an emergency fund, and saving for retirement. You’re a responsible parent when you make sure your child goes to school, gets regular medical checkups, etc. So responsible leadership seems pretty obvious — or is it?
The increasing dynamic and complexity of the daily business, a variety of lifestyles and beliefs about what is right or wrong, as well as differing legal regulations make the task of leading responsibly in a globalizing economy more difficult, complex, and uncertain. In addition to this, grand challenges like global warming, rising inequality, global migration, and poverty, put pressure not only on governments and international organizations but also on business firms to contribute to a sustainable future for people and the planet.
As a consequence of the above, those in leadership positions at firms find themselves increasingly facing demands to assume responsibility, not only toward shareholders but also toward society and the environment.
I will be addressing some key questions to the concept of Responsible Leadership here, including
- What are the characteristics of a Responsible Leader in the 21st century?
- How can he or she make decisions in complex and confusing situations, taking into account the interests of stakeholders, the environment, and society?
- Responsible Leadership – How it can be learned and how to act accordingly.
Being “Responsible” means different things in different contexts
In ordered contexts, being responsible is pretty concrete and measurable. If you follow the rules (e.g. sticking to the speed limit while driving) or follow proven best practices you are responsible. Here responsibility is about compliance, governance, and following established or conventional wisdom. In the complicated domain, responsibility is about making informed decisions, consulting the right experts (no-one’s ever been fired for consulting with McKinsey), or making sure decisions are made based on solid evidence. It’s about considering various perspectives and/or solutions, and weighing up the pros and cons in order to make the right decision. It’s about considering scenarios, preparing for various eventualities, and charting the “safest” course. Being responsible here rests on the assumption that one can predict and prepare for future outcomes; that there are right solutions to problems and your task is to choose the best, most sustainable option and then plan properly so ensure that budgets aren’t overrun and deadlines aren’t missed. A Responsible Leader needs to be able to lead under any circumstance, be able to foresee the potential hindrances likely to arise, address any abnormal situation after evaluating and considering the viewpoints of all concerned parties, and most importantly, do not seek personal gains. For a responsible leader, it becomes mandatory to seek overall upliftment of not only the organization but its employees in particular. Not to stretch it long, but qualities such as getting work done with the best of the limited resources available become imperative here.
But what does responsible mean in complex contexts where we don’t fully understand the problem, where there are no solutions or right answers and the rich, non-linear interactions and inter-weavings between agents make it impossible to predict the future? Even the most well-intentioned and well thought through solution could have the complete opposite effect of what we intended. Therefore, some of the things that would be deemed responsible in ordered contexts (e.g. implementing expert solutions or rule compliance), might actually be irresponsible in complexity. In complexity, responsibility involves ensuring that interventions are “safe-to-fail” (e.g. small & local), having amplification and damping strategies and ALWAYS ensuring that you have adequate feedback mechanisms in place to monitor the impact of your actions. It also involves spreading your risk across multiple, diverse (even contradictory), and sometimes oblique experimental interventions and being ready to learn from failure. Complexity being responsible rests on the assumption that the system is unpredictable; that we have no clear understanding of the problem or how the system is interconnected; that there are no rules or best practices to follow, and that listening to experts could lead us down the wrong path. It’s about “crossing a river by feeling the stones” and acknowledging that there is no safe and reliable bridge that we can use.
While understanding complex contexts, always, decision making falls like a sword with two ends into the hands of the responsible leaders, and their job remains to weigh which end will cause a deeper cut overall. Say, in recent times of the Covid-19 pandemic, which has forced the most businesses to cut roles, temporarily and permanently, how can the leaders decide whom to retain and whom to let go of. Let me explain this by way of an example. It is possible that a mid-level worker has been contributing to the company for 10 years, but a recent hire has shown at par excellence, and also forms a great new asset to the company. But, for the manager, there is no tunnel with a light on both ends. In such kind of situations, the stakeholders’ standpoint comes into play. The questions the manager will need to ask is, who is likely to continue for the long term with the company, and who has been goodwill to the company. I am not referring that the new hire should be discarded, but all I am trying to wonder is that if we look at the social dynamics, out of the two, who is more capable of finding an alternate way of making money? This is the foremost question we need to ask.
My father once told me, “Education is the best investment any parent can make for their child. No money or asset will benefit them as much as education.” I always abide by these words of wisdom and thrive to make my life a journey, a journey of constant learning. One cannot become a responsible leader simply by reading a book, or by listening to an expert’s advice. It is a skill, which one self-imparts by employing the learnings, and making mistakes to verify their learnings.
Every leader, in whatsoever function he might be performing, needs to stress on the importance of being not just a good leader, but be a responsible one to set an example to other leaders, in other business functions, and other industries. I say that we cannot, in fact, no one can generalize the definition of a responsible leader, which can perform well in any scenario. But what can be normalized is the mindset and the thinking towards achieving that goal.
My final opinion on defining responsible leadership will be, ‘A responsible leader is one who has the courage to take unprecedented decisions for the overall good and better of the company and its stakeholders, whilst also maintaining employee interest.’
In this 21st century, there is a lot more to just being the head of a team. These include exposure to a lot of intangible virtues including the “ability to administer, presence to inspire, charisma to lead, and fortitude to persist in the face of challenge.”
I hope my perspective helped your thoughts on this topic. Please feel free to leave your comments or buzz me up for further discussions.
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