Developing Strong Leaders in a Risk Averse Environment
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This document discusses developing strong leadership in risk-averse environments. It begins by defining risk-taking and courage, then addresses the costs of not taking risks for both individuals and organizations. These costs include increased anxiety, lack of growth, and risk of becoming stuck in routines. The document provides techniques for assessing and increasing risk tolerance in teams and organizations, including identifying fears, framing risks appropriately, and establishing communities of practice to support risk-taking. It emphasizes the importance of courageous conversations to surface issues and conflicts. Overall, the document argues that effective leadership requires embracing risks, conflicts and adaptive changes rather than avoiding them.
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Developing Strong Leaders in a Risk Averse Environment
- 1. Developing Strong Leaders in a Risk Averse Environment Terry Rodriguez, EdD
- 2. AGENDA • Define courage and risk-taking • Self assessment – risk taking strengths and opportunities • Identify cost of not taking action – individuals and organizations • Learn/review skills for effectively taking risks • Courageous conversations • Assess your organization’s adaptability • Action steps 2
- 3. OUTCOMES • Apply adaptive leadership techniques • Able to assess obstacles in your team and organization that prevent risk taking • Methods to support team in taking more risks and adaptive behavior • Create action plan for unresolved conflict • Use team and organization learning practices 3
- 4. LEADERSHIP 4
- 5. RISK? Propensity to evade any loss contingency, even a very small one Risk Aversion: "Risk aversion becomes apparent when an individual is faced with even the slightest of dangers." 5
- 6. WHAT DO RISK AVERSE BEHAVIORS LOOK LIKE? What are the costs to organizations? 6
- 7. THE COST OF NOT TAKING RISKS: INDIVIDUALS [T]he damage comes when people are marinating in anticipation … which can last for months or years. It’s the anxiety over the future that has the worst effect. ~ Dr. Robert Sapolsky “ “ 7
- 8. THE COST OF NOT TAKING RISKS: INDIVIDUALS … the building blocks of psychological stress - a feeling as if you have no control over the adversities in your life… no predictive information. Create outlets for the frustrations caused by the stressors, if you have no social support. ~ Dr. Robert Sapolsky “ “ 8
- 9. PLATEAUS-MENTAL DEVELOPMENT 9 Socialized Mind Self-Authoring Mind Self Transforming Mind
- 10. COURAGE There's something which impels us to show our inner souls. The more courageous we are, the more we succeed in explaining what we know. ~ Maya Angelou “ “ 10
- 11. Dr. Maya Angelou
- 12. WHAT IS BELOW THE SURFACE? 12
- 13. PRACTICE COURAGE: LEADERS ,. BRAINSTORM: What different activities, relationships or processes help you support your team in gaining the courage to act? Every time you make the hard, correct decision you become a bit more courageous and every time you make the easy, wrong decision you become a bit more cowardly. If you are CEO, these choices will lead to a courageous or cowardly company. ~Ben Horwitz “ “ 13
- 14. LEADERSHIP AND DANGER To act outside the narrow confines of your job description, when progress requires it, lies close to the heart of leadership, and to its danger. “ “ ~Marty Linsky, Leadership on the Line 14
- 15. THE NEW NORMAL: ORGANIZATIONS • Uncertain future • Inadequate information • Change as a constant • Adaptive challenges • no easy answers • difficult learning • new stakeholders The people involved must solve, not authority. 15
- 16. DISTINGUISHING LEADERSHIP AND AUTHORITY Source: Cambridge Leadership Associates-Marty Linsky Beyond this line – Begin to disappoint expectations and take risks Dancing on the edge of authority-into- leadership territory 16
- 17. THINK OF A COURAGEOUS ACT • What made it courageous? • What prompted you to act? • How fearful was the situation (low, medium, high)? • What did you do? • How did others react? • How did you feel? • What surprised you? • What did you learn? Page 1 in your workbook 17
- 18. MISSED LEADERSHIP OPPORTUNITIES • What opportunities have you forgone? • What prevented you from taking action? • What scripts were playing in your mind? • Where, when and from whom did these occur? • What might help you find your voice? Page 3 in your workbook 18
- 19. REQUIRES NEW LEADERSHIP PRACTICES Focus more on adaptation, less on execution Run experiments, don’t just solve problems (failure as a learning opportunity) Practice internal and external interdependence, not just autonomy (unusual collaborations Don’t avoid conflict, surface issues–don’t just resolve it Invent new practices, don’t just adopt best practices Take care of yourself, don’t just sacrifice self for the cause 19 Source: Cambridge Leadership Associates-Marty Linsky
- 20. HOW WE TAKE ACTION • Consequences of NOT taking action • Identify fears • Worst that can happen • Aligned with values • Calculated risk or reckless action • Inform your boss • Present your view - open not frowning 20
- 21. METHODS TO REDUCE RISK : INDIVIDUALS • Understand the risk • Analyze the consequences • Frame the risk - pilot project, experiment • Monitor/report out • Share the risk - allies • Identify and manage worst case scenario 21
- 22. COURAGEOUS CONVERSATIONS CAMBRIDGE LEADERSHIP ASSOCIATES-MARTY LINSKY Adaptive Ask Might lose and challenge other, but potential to move forward Confronting Conflict-Debate How are you seen? What do they think you want? Own point of view Little progress Diagnostic Inquiry 22
- 23. COURAGEOUS CONVERSATION Think of a conflict that you have been avoiding and would like to address: • What values in conflict? • What might other person be afraid of losing? • What might you lose? • What have you done? • What do you really want? • What relationship do I want? • Listen! Empathy! Respect! Role play how you will begin your dialogue and work through obstacles to understanding their viewpoint: • Are you willing to modify your request or viewpoint-Why or why not? • What resolution is possible? 23
- 24. HOW RISK AVERSE IS YOUR ORGANIZATION? Threat of the un- discussed What mental model keeps this alive? What kept issue from being discussed? Unintended consequences currently and in future? How does it block team or organization learning? What do we want to do? 24
- 25. Reflection/continuous learning in DNA Leadership capacity developed Independent judgement Shared responsibility for future Elephants named FIVE CHARACTERISTICS OF ADAPTIVE ORGANIZATIONS Source: CLA -Marty Linsky25
- 26. ORGANIZATIONAL COURAGE 1) How do you bring courage and demonstrate it for others? 2) How does your organization support courage – examples? 3) What can be done to teach how your organization demonstrates courage? 26
- 27. CREATE COMMUNITIES OF PRACTICE • Bring together people who want to create change and learn from each other • Provide support for taking risks, courageous conversations • Celebrate risk taking, courage, “lessons learned” in visible manner 27
- 28. OD CONVERSATIONS Open conversation Learn from each other Common interests Knowledge/ practice PROJECT TEAM AND STAFF/OPS MEETINGS Specific goals Milestones Schedules Formal/ hierarchy
- 29. SMALL PAYOFF BIG HARDEASEofIMPLEMENTATIONEASY SHORT TERM WINS PAYOFF MATRIX Page 10 in your workbook 29
- 30. …[the] challenge of leadership, when trying to generate adaptive change is to work with differences, passions and conflicts [and] harness their energy. ~ Marty Linsky “ “ 30
- 31. MY LEADERSHIP ACTION PLAN Integrate what you have learned! Page 11 in your workbook 31
Editor's Notes
- What can I do to make my setting/team/organization the best and most fertile ground possible for the growth of leaders?
- The study of more < 600 people found that a shocking 8 percent of employees estimate their avoidance costs their organization more than $10,000. ORGANIZATIONS The "Customer Experience" is Compromised: Team dysfunction is felt by the customer --poor quality and reduced service delivery. The "Best and Brightest" Leave: continuous conflict avoidance is the departure of your best people. Brand Value Weakens: Over time, a firm's brand value weakens, too. http://www.inc.com/james-kerr/6-bad-things-that-happen-when-leaders-avoid-conflict.html
- Dr. Sapolsky-leading neuroscientist: Esp. bad for brain: Stress releases hormones : catecholamines and glucocorticoids response to short term danger/stress BUT hormones stay and affect cognitive function-harm prefrontal cortex: decline ins lang and math ability and weakens working memory and attention regulation and change from thoughtful smart people to prefrontal cortex directing you and easily distracted Dr. Sapolsky-leading neuroscientist: Esp bad for brain: Stress releases hormones : catecholamines and glucocorticoids response to short term danger/stress BUT hormones stay ---- affect cognitive function-harm prefrontal cortex: decline in lang and math ability and weakens working memory and attention regulation 2 and change from thoughtful smart people to prefrontal cortex directing you and easily distracted
- INDIVIDUALS: One in 20 estimates that over the course of a drawn-out silent conflict, they waste time ruminating about the problem for more than 6 months. Communications Become Strained: A conflict that goes unresolved Teamwork Diminishes: As communications become strained within a team, cooperation and teamwork will lessen and animosity will build. Productivity Suffers
- Robert Kegan and Lisa Laskow Leahey have written in Immunity to Change: 3 plateaus in adult mental development: Socialized Mind: Shaped by our loyalties-59% Team player Faithful Follower Aligning Seeks Direction Reliant Self-Authoring Mind-can step back-34% Agenda-driving Leader learns to lead Own compass. Own frame Problem solving Independent Self-Transforming Mind-can step back and see own limits of thinking 7% Meta-Leader Leader learns to lead Multiframe-holds contradictions Problem finding Interdependent
- Courageous derived from corage, meaning "heart, innermost feelings, or temper." Possessing or displaying courage; able to face and deal with danger or fear without flinching
- What stops people from taking risks? Dependence on authority Embarrassment-criticized Fear Left out of decision making Lose job Make enemies Stand out Not likely to be followed Stuck in dead end job Not a team player
- Andreessen Horowitz backs bold entrepreneurs who move fast, think big, and are committed to building the next major franchises in technology. Founded by Marc Andreessen and Ben Horowitz, Leaders use different strategies to overcome fear. Brainstorm different activities, relationships or processes that help you support your team in gaining the courage to follow through Every time you make the hard, correct decision you become a bit more courageous and every time you make the easy, wrong decision you become a bit more cowardly. If you are CEO, these choices will lead to a courageous or cowardly company. Ben Horwitz
- Industry research, for example, shows that companies spent more than $24 billion on leadership and management training worldwide in 2013, an increase of 15% from 2012. leadership development begins with a real business challenge that leaders need to solve, instead of with a hypothetical case study or simulation. In order to succeed, they have to act, reach outside of their comfort zone, and adapt their approach. Cargill, one of the world’s largest global agricultural processing and distribution companies, for high-potential managers called “Leading in a Complex World.” Participants identified a challenging and complex problem in their business or function (e.g., product pricing, operational efficiency, customer service, etc.). Then assigned to meet with people on the front lines of the issue both inside and outside the company (innovators, “future‐seers,” provocateurs, and stakeholders whose voices aren’t normally heard) to open up their thinking Then each manager required to carry out at least one safe-to-fail experiment. The small-scale project would test a possible solution in a low-risk way, in 100 days or less, and without the pressure of having to be right. Of the 75 participants, 80% completed their projects -produced tangible results . One experiment: 2.6% reduction in work orders, which = $342,000 over 3 months. Leadership Development Should Focus on Experiments Ron Ashkenas Robert Hausmann APRIL 12, 2016
- Changing values or priorities or external changes driving need for change? Where am I in organization –well positioned in organization? and my perspective? Relevant parties-their perspective? Internal contradictions of values and mission with actual operations? Who loses? Factions? What strategies do I have? What strategies am I unwilling to try-why? HOW TO MOVE FROM UP THE PLATEAUS OF DEVELOPMENT IS THE QUESTION IMMUNITY TO CHANGE Competing Values Not doing what you say Not aware of scripts
- Beyond this line – Begin to disappoint expectations and take risks Dancing on the edge of authority into leadership territory Need to help people through disequilibrium as you are driving change People will experience loss How much heat can you turn up—allow you to move forward but not have an explosion Authority forces people but adaptive leadership risk involved-don’t know all the answers up front=people might get upset JULIE Gilbert Best Buy-Linsky
- Research: The Innovator’s DNA, Bezos about the crucial role experimentation plays at Amazon. “Experiments are key to innovation because they rarely turn out as you expect and you learn so much,” “We’ve tried to reduce the cost of doing experiments so that we can do more of them. If you can increase the number of experiments you try from a hundred to a thousand, you dramatically increase the number of innovations you produce.” Innovators like Bezos see the world as a laboratory. They continually seek to answer those “what-if” questions as they search for new solutions. Fortune Insiders /17/2015 Focus more on adaptation, less on execution Run experiments, (failure as a learning opportunity) Practice internal and external interdependence, (unusual collaborations, sacrificing credit) Don’t avoid conflict, surface issues--not just resolve it Invent new practices, not just adopt best practices Take care of yourself, not just sacrifice self for the cause
- Need to think how Fear-talk to others and admit fear-and still act Realize worst probably won’t occur Did not think through-stubborn
- Diagnostic Inquiry: What is most important? What losses? Adaptive Ask: Risk taking that helps relationship move Diagnosis is one of most important skills as you gain perspective and look at big picture-not immediately jump to action
- Cycle involves observation diagnosis intervention reflection change or adapt?
- How do you bring courage to work and demonstrate it for others? How does your organization support courage—examples? What can be done to teach how your organization demonstrates courage?