Accenture Banking Blog

Imagine a boat weathering a storm at sea. The passengers are panicking and even the experienced crew look a bit worried and start to bicker. But the captain doesn’t panic, argue with the crew or stubbornly stick to the course. The captain is the one that calms everyone down, turns the boat around and brings everyone safely home with the help of the crew.

That storm is akin to the disruptive and transformational change that many companies face today. And leading that transformation requires developing and inspiring confidence in the face of uncertainty–just like the captain of the boat, weathering a storm.

The rapid changes of the 21st century, especially in technology, are the big disruptions that are driving uncertainty and creating both the greatest threats and opportunities for businesses.

While most people think of disruption as a ‘big bang’ event that wipes out a company or entire industry–such as Woolworths or steel manufacturing–those are quite rare, just like shipwrecks. The more common is kind is ‘compressive disruption’, which is akin to being battered by the waves over and over. In mature industries, new entrants to market nibble away at existing companies’ margins, gradually squeezing them.

At Accenture, we studied nearly 800 publicly listed companies in the UK and their exposure to disruption, and found that more than half of British businesses are currently experiencing disruption. A further 40 per cent are estimated to be susceptible in the future. That’s most of our economy either in the storm or on the edge.

Most CEOs today are fully aware of disruption. They know they need to innovate and have launched digital capabilities. For most big businesses, the real challenge is that turning the boat around takes time, especially if you’re an oil tanker when the new entrants are speedboats.

Scaling innovation is really challenging for a large business with complex legacy systems and beliefs set in stone. Turning the boat around is a balancing act between reinventing these valuable businesses and releasing new growth, and scaling the new off the back of the things you’re good at. We call this balancing act the ‘wise pivot’.

In order to lead in an uncertain and disrupted world, you have to build agility within your business, not just manage one great transformation. Agility is not the same as ‘Agile’ like SCRUM or SAFE. It’s the ability to respond effectively to disruption, opportunity and theat. Truly agile organisations have twice the probability of top quartile financial results and saw a 10-points higher EBITDA growth from 2007 to 2017 versus their peer group.

Truly agile organisations are both fast and stable. Only being one of these–fast or stable–is not enough. Crucially, these businesses lower uncertainty through scanning the horizon and seeking diverse viewpoints. They take action by experimenting with a range of options, and use an iterative approach to learn from success and failure alike.

Both transformation and agility are required in the face of uncertainty and they both demand great vision, leadership and trust. The captain must have a clear vision to get the ship home safely. Our research shows that vision has a three to four times greater link to business benefits than any other factor in transformational change.

Yet, a successful transformation cannot be led by one captain alone. It is not just the CEO and executive team; it’s about creating leaders at all levels of the business. Leadership at all levels has double the impact on business performance than any other factor during transformational change. It is up to HR professionals and leaders to create the time and support for good change leadership.

Even with great vision and leadership, uncertainty can still create fear and anxiety. Fear and anxiety can create some of the biggest challenges to making transformation successful–85 per cent of transformations that fail do so because of pre-existing organisation dynamics, especially a lack of trust.

Trust and psychological safety are the antidotes to fear. They encourage and support innovation, problem solving, learning and behaviour change. When the storm blows in and you need to transform, trust needs to be already in place.

Last but not the least, how do leaders continue to inspire confidence in the face of rapidly changing work? There is no uncertainty quite like job insecurity. Put bluntly, when we get the crew safe to shore, are the robots going to take away their jobs?

It looks pretty unlikely. Our analysis shows that 38 per cent of worker hours can be automated by technology, but 51 per cent of hours are more ‘augmentable’ by technology. In addition, two thirds of executives in the UK believe that intelligent technologies will, in fact, increase the number of roles.

Our research with the World Economic Forum shows two thirds of workers want to reskill, but only 3 per cent are significantly increasing investments in learning. This needs to be addressed. Investing in continuous learning of market-relevant skills will raise the confidence of our people and the agility of our businesses. Whereas mind-sets and skills were once a brake on transformation, they can become the enabler of agility.

Even if you are constrained in your learning investments, engage your people on their own journey. For those that want to, give them some time and space to learn. Allow them to get back into the habit of learning all the time. Put learning back into the hands of your people–allow them to learn together and curate their own content.

So, in order to lead transformation, develop and inspire confidence in the face of uncertainty, three steps are key:

  • Making a wise pivot for transformation and true agility
  • Making sure vision, leadership at all levels and trust are in place
  • Helping your people have a stake in the future, especially with new skills

While uncertainty has always been with us on any voyage, new storms of disruption will keep coming in the future. Disruption and uncertainty are our reality, not the problem.

As HR professionals and leaders we need to respond. So get your crew ready, set a course and good luck on all your voyages ahead!

To find out more about how lead the transformation in the face of uncertainty, please contact me here, or @andyyoungACN.