CHIPS Articles: Leadership in the 21st Century Environment — A Proposed Framework

The strategic environment of the 21st century has been characterized as volatile, uncertain, complex and ambiguous (V.U.C.A) as new technologies, developments, disruptions, change and transformation continue to accelerate. These trends profoundly impact the ability of any organization to remain relevant and competitive. We are now entering a period where our existing views of leadership need to be reconsidered to pace these changes and our ensure superiority and competitive advantage.

Often leadership gets confused with management, which are quite different but also closely related.

Management focuses on the planning, structuring and efficient execution of an activity, task or project to achieve a set of outcomes — it is highly organized, monitored and controlled to get the final product or result.

Leadership is the other side of the coin and is about inspiring and motivating people in organizations to go well beyond where they thought possible, making their greatest accomplishments; these can change the game or shift paradigms to a higher level of performance, efficiency and effectiveness — essentially transforming institutions to achieve their utmost in meeting their most challenging goals and objectives.

Leadership depends on different and complex factors rooted in psychology and sociology, but ultimately focuses on what leaders know, how they think, and how they both communicate and send appropriate signals to build trust and mutual respect.

Leadership is about creating an environment in their organizations which unleashes full human potential, one guiding and inspiring coalitions of participants to achieve great things. Struggling to provide leadership in an increasingly V.U.C.A. environment, leaders require new ways of looking at the world i.e., shifting their models to better adapt to and anticipate an uncertain and accelerating future, one by its very nature approaching chaos.

A framework is proposed as shown in Figure 1 integrating 7 key concepts necessary for leaders to succeed in this 21st century V.U.C.A. environment. The elements of this framework form a system of thought, captured as a: Strategic, Complex, Adaptive, Innovative, Learning, and Emergent System (SCAILES). This framework leverages, extends and broadens concepts grounded in complex adaptive systems’ (CAS) theory. SCAILES takes CAS to a new level and makes it more accessible, by addressing needed anticipatory and innovative capabilities, focused on learning, as the pre-requisite for future success. The SCAILES framework is described below:

Strategic: To succeed and achieve a desired culture of strategic thinking, leaders and their organizations need to be able to see the big picture and think holistically about how dynamic inputs affect one another. Strategic thinking is about anticipating the future based on what is known, and considering the possibilities and probabilities of each long term outcome. Strategic thinking links the past to the present, as well as to the future, as a single continuum of dynamic interactions. It links the big picture view to the tactical level. Strategic thinking helps leaders to step back and think-through plans and decisions, connecting future outcomes to today’s tactical actions, and develop a credible path to achieve a desired state.

Complex: Complexity refers to the numbers of elements one considers when thinking through problems, issues or situations, to help create well-informed strategies, plans and decisions. Organizations and technologically advanced systems are increasingly complex, and their dynamic, turbulent nature creates significant leadership challenges. Leaders must try to navigate what is known, while accounting for what might not be known i.e., unknown unknowns. These are an important consideration, especially in a VUCA environment, requiring discerning judgment and wisdom. Leaders must realize the networked nature of complexity, and how its various elements are interdependent and all striving to achieve a proper equilibrium.

Adaptive: As the VUCA environment continues to change, leaders and their organizations must adeptly sense environments and be aware of changes which may influence their actions, behaviors, plans, strategies and investments. With awareness ingrained in leaders’ minds and in their organizations, there must be an ability to react effectively and efficiently to stay ahead of environmental changes. This requires leaders and their organizations to be agile, flexible and adaptive. In bureaucratic organizations, with rigid processes, guidelines, workflows etc., this is very difficult and can be a “system constraint” in the fast paced competitive environment.

Innovative: Innovative leaders and their organizations place a premium on learning, knowledge and the ability to think creatively to catalyze new thoughts and connections which result in novel ideas and concepts. Innovations occur in an environment where there is an explicit need, and where it is safe to experiment and fail, summed up by “fail safe, fail fast, fail often.” Leaders focus on fostering organizations which accelerate learning and the development of break-through ideas and concepts which make real and substantial differences.

Organizations which can routinely develop novel solutions through collective intelligence, rooted in knowledge and effective and efficient social networks built on mutual trust and respect, will achieve a cultural nirvana. In the 21st century VUCA environment, generating game-changers or disruptive innovations that establish completely new paradigms, or “off-sets” for distinctive competitive advantage, represent the Holy Grail to stakeholders and customers, specifically the Department of the Navy.

Learning: Learning is the foundational skill of the 21st century — it not only affects what one knows but also how thinking takes place. In the future, knowledge dominance will determine outcomes. Learning to think strategically, creatively, critically, analytically and in terms of systems and networks is foundational to effective organizations. Accelerating learning both individually and collectively could not be more important, especially in a VUCA environment. It takes place by associating something new with what is already known, extending existing knowledge. New knowledge demands asking insightful questions, coupled to foresight, to create a better understanding.

Spending time to make sense of complexity, and to think through meanings and implications, can build new neural connections. These new connections foster even more possibilities for catalyzing new associations, i.e., accelerating learning. Along these lines, prototyping and experimenting are very powerful ways to learn something new.

Continuous learning enhances one’s ability to think and contribute meaningfully; it is also inspiring, self-fulfilling and ultimately self-actualizing. Experiential learning, where knowledge is applied in context, i.e., hands-on, builds personal and organizational growth and development, and wider results. Newly emerging serious games, virtual, collaborative experiences, including Massive Open Online Courseware (MOOCs) and, especially, Massive Multiplayer On-line War Game Leveraging the Internet (MMOWGLI) pioneered by the Navy, provide platforms offering great potential to accelerate learning. They do so through deep engagement and immersion in a collaborative setting to achieve deeper understanding, context and perspective.

Emergence: To unleash human potential, leaders in the 21st century must create an environment that enables the unbridled emergence of new ideas, concepts and perspectives. Leaders must set the tone, so that employees feel encouraged and possess safety of voice, perceiving a sense of openness and trust for meaningful dialogue and exchange as the norm. Just as in the rich and lush conditions of an ecosystem or rainforest, where nature can thrive in near-perfect balance, leaders create the right expectations and open-minded conditions allowing new ideas to emerge.

Leaders set the stage for their environment and the culture that comes with it — emergence occurs when a genuine interest in generating productive ideas and solutions arises, and with an expressed appreciation based on the merit of ideas regardless of their source i.e., a meritocracy instead of a more traditional hierarchy. Diversity of thought and perspective, applying different lenses and backgrounds to a problem, often plays a key role in enabling the emergence of the most novel and meaningful ideas. The role of leaders is to set the stage, create the right environment, ask the right questions, and then ‘let go’ to catalyze productive and meaningful exchange to achieve great outcomes.

System: Successful leaders think in terms of open and collaborative systems, which foster internal and external interactions, exchanges and, ultimately, synergy to create dynamic learning and innovative social environments. Leaders must think in terms of interconnected and interdependent systems, loosely coupled and able to easily adapt.

Leaders must also realize that thinking itself is a complex system that evolves new thoughts and ideas in response to influential factors. Understanding these influential factors is critical to understanding the basis of thoughts and ideas i.e., the biases and emotions of our thinking. Ultimately, the ability of leaders to consider the wide range of possibilities and their inherent probabilities, think them through, and consider their potential implications provides the basis for the insights, foresights and capabilities necessary to take action and succeed.

The SCAILES framework is a new way to think about leadership amidst the growing challenges of the 21st century VUCA environment. Leaders and organizations that can stay acutely aware, anticipate, ideate, and lean forward in their connectedness, thinking and learning will set the example for others to follow. These organizations exemplars of thought leadership and leadership-in-action, and will have a distinct competitive advantage as the uncertainties, disruptions and nonlinearities of the 21st century unfold.