Great Leaders Use a Crisis to Their Advantage. Here’s How to Do It.

Don’t Just Survive. Thrive.

In competitive bike racing, the riders start as a single group. Called a peloton (French for platoon), this group will stay together as a large mass for most of the race. By clustering together, only the few racers at the front will encounter the full effects of wind resistance. Everyone behind them can draft off the leader, reducing drag and saving energy.

Consequently, it’s very difficult for a lead racer to pull away from the peloton. Everyone else is able to maintain the same pace without working nearly as hard. The front racers are already exerting more energy and they simply don’t have enough to break away from the pack.

The peloton effect, however, reduces on hills, especially steep hills. Suddenly, everyone needs to work harder to ascend. And elite racers know that this is their key opportunity to break away and force those behind them to overcome the wind resistance to catch back up.

When all of the racers experience come under similar stress, the best recognize that it’s their opportunity to distance themselves from the group.

This same principle applies to leadership.

In stable times, the difference between leaders and managers is less evident. Companies focus on execution and incremental improvements. They’re largely content to maintain a steady business and stay within the peloton.

But when those steep hills come around, great leaders take advantage. They watch for major challenges, and then use these opportunities to distance themselves from their competition.

Great Leaders Adapt and Thrive.

“If you don’t like change, you’re going to like irrelevance even less.” — General Eric Shinseki

If there’s one thing we’ll remember about 2020, it’s change. Between a global pandemic, divisive politics, and widespread social unrest, few of us could maintain our assumptions of stability. In these situations, we all faced two choices: hunker down and try to survive or adapt and find a new way to thrive.

Of the companies that chose the former, one similarity became clear: they all tried to meet this turbulence with obsolete approaches. They reacted to the challenges of the future with yesterday’s logic.

Charles Darwin showed that survival is less dependent on strength than the ability to adapt within changing times. As our rate of change is unlikely to slow down anytime soon, those who try to meet these challenges by fixating on the past will certainly miss the future.

Great leaders see change as an opportunity. They position their organizations so that when change happens, they can quickly figure how to find the potential opportunity and exploit it to their advantage. They know that like any steep hill, it offers a unique opportunity to separate their team from the pack.

Whether this same combination of struggles will occur again, I don’t know. But I do know that it won’t be the last change that we see. And the underlying leadership techniques to help us move from crisis to opportunity will continue to be universal. Our challenge is to put in the effort now so that we’ll be better prepared to adapt and thrive through that next steep hill.

Set a Clear, Compelling Vision.

“Vision is the art of seeing what is invisible to others.” — Jonathan Swift

A compelling vision is a leader’s most powerful tool. It clarifies the contrast between what we are today and what we could be tomorrow. Done well, it creates a driving force to align and inspire actions across large numbers of people.

Without a strong vision, transformation efforts quickly dissolve into incompatible projects and poor investments. Everyone is working on something, but most of those efforts go off in a different direction, wasting people’s time and building frustration. When people lose sight of how their efforts support the overall vision, they quickly lose motivation.

A clear, compelling vision provides this alignment. It also simplifies every future decision. By clearly telling everyone where we need to go, future questions all come down to one thing: Is this in line with the vision?

As decisions become easier they can be pushed down throughout the organization. Speed improves and people take more ownership for execution.

Everyone has their own opinion on what makes up a strong vision. In my experience, it helps to shoot for the following:

• Attainable: Realistic enough that people can visualize a path to success.
• Bold: Inspires people to look beyond incremental change.
• Communicable: Easy to communicate. People need to be able to explain and understand within five minutes.
• Desirable: Appeals to people’s long-term interests. Otherwise good luck getting support.
• Encompassing: Supports individual initiative across the team and encourages everyone to contribute in their roles.
• Focused: Clear enough to help guide decision-making.

Above all, a good vision quickly creates understanding and interest. If you can’t describe it in five minutes and generate these two behaviors, try again.

Strengthen Your Connections.

“Empathy is being concerned about the human being and not just their output.” — Simon Sinek

It’s a common thought that the key to innovation is solving the customer’s problems. It’s not. It’s solving those problems that no one else even knows they have.

Everyone was happy communicating by telegram until Alexander Graham Bell came along and showed them the telephone. I remember going to lumber yards and hardware stores when I was a kid until Home Depot and Lowes combined the two and took over the industry. And few people were disappointed with their dollar coffees until Starbucks showed up and convinced us all to pay four times as much for a cup.

Innovation comes from recognizing problems and solutions when everyone else is content with the status quo. But contrary to some lines of thinking, these innovations don’t come from gifted visionaries locked in a room with nothing but their own prophetic vision. They come from detailed, empathetic communication with customers.

By putting ourselves in someone else’s shoes, we can better appreciate how they feel and act. By listening with empathy, we can better understand their stories. We can recognize the discrepancies that they’ve come to simply accept as a part of their lives.

I’ve often felt that for being so simple, listening well is an underutilized superpower. The best way to stay relevant in a changing world is to make this a top priority. Listen well. And listen with empathy.

Put Your Top Talent in the Right Areas.

“In every area of effectiveness within an organization, one feeds the opportunities and starves the problems.” — Peter Drucker, The Effective Executive

Every company has tails.

Anything you can measure follows along on a continuum from low to high, whether it’s height, weight, rate of defects, behavioral traits, and specific to this discussion, performance levels. The majority of these measurements follow a normal distribution, with a mean and standard deviation that shows 95% of people fall within two standard deviations of the average and 99.7% fall within three.

Those outside of these groups reside in the tails. And those tails represent our biggest opportunities.

This normal or Gaussian distribution is easy to use, so people default to it for most measurements. But while normal distributions tend to fit nicely in statistics textbooks, they often fall short in reality. Increasing income inequality doesn’t fit this model as the massive amount of wealth within a small number of people is too far from average to accurately represent within a normal distribution. This also holds true for major natural events, economic opportunities, and identifying the impact of top performers.

Instead of a normal distribution, top performers tend to fall within a power law distribution. As Vilfredo Pareto and his famous pea pods showed us, the vast majority of output comes from a minority of inputs. Those within the upper tail of a power curve increase output exponentially, not through the established standard deviation.

This was somewhat of a detour here, but the main point is that top performers deliver far more value than your average performer. And unless you’re using them to your greatest advantage, you’re limiting your company’s ability to grow.

Now pause for a minute and make two lists. First, what people deliver the greatest value in your organization? Second, what roles deliver the greatest value?

Very rarely do these two lists overlap.

Most companies manage performance on a normal distribution. They don’t recognize the scale of opportunity in their top performers. Consequently, their assignments often focus on solving problems. And while this is important, it only restores yesterday’s status. It doesn’t produce growth. It doesn’t move us forward into the future.

Great opportunities and great performers both lie in the upper tail. If the competition is matching these, can you afford to do any less?

If the competition is doing this with their top performers, can you afford to do it with any less?

Experiment. Fail. Learn. Then Be Ready to Scale.

“I don’t think that you can invent on behalf of customers unless you’re willing to think long-term, because a lot of invention doesn’t work. If you’re going to invent, it means you’re going to experiment, and if you’re going to experiment, you’re going to fail, and if you’re going to fail, you have to think long term.” — Jeff Bezos

Dr. Charles Sidney Burwell was a cardiologist who specialized in circulation changes associated with heart disease. He was also the dean of Harvard Medical School from 1935 to 1949. In a famous address to students at the medical school, he said, “Half of what we are going to teach you is wrong, and half of it is right. Our problem is that we don’t know which half is which.”

Innovation is similar. We have a lot of good ideas. We just don’t know which ones will work out. Which is why it’s critical to make small bets and experiment.

I’m partial to using minimum viable products to quickly prototype different ideas and accelerate our build-measure-learn feedback loops. Increased feedback cycles bring quicker iterations. Quicker iterations accelerate pivot decision points. All of which encourages the team to do one of two things: improve an idea or kill it off quickly. As Tom Peters put it, “Test fast, fail fast, adjust fast.”

But experimentation is only part of the process. Once we demonstrate the viability of an idea, we need to be ready to scale it. If you’re not willing to double down and move forward, there’s little point in experimenting in the first place.

This doesn’t mean that we need to bet the company on every half-proven idea. But it does mean that we should be thinking of the next steps as we experiment. We should design our tests so that they’re quickly validating theories and ideas that move us forward. In the wise words of Ernest Rutherford, “If your experiment needs statistics, you ought to have a done a better experiment.”

Unleash the Collective Genius of Your Team.

“Empowerment programs appeared to be a reaction to the fact that we had actively disempowered people.” — Captain L. David Marquet, Turn the Ship Around!

I don’t like the idea of someone else trying to empower me. It seems condescending. As though I need their help to step up and add value.

People generally want to contribute. They want to add value towards a meaningful goal. It’s just that too often management gets in their way.

With hundreds of pages of rulebooks, operating instructions, and process requirements, we’ve indoctrinated people to turn off their brains and follow instructions. Or we’ve showed people that the safe way of doing things is the current way of doing them. So it doesn’t pay to try something new, even if it might be better.

Instead of empowering people, maybe we should just focus on not disempowering them. And to do this, management needs to give up some control. Former GE CEO Jack Welsh made this point well,

“The old organization was built on control, but the world has changed. The world is moving at such a pace that control has become a limitation. It slows you down. You’ve got to balance freedom with some control, but you’ve got to have more freedom than you ever dreamed of.”

The planned crisis never occurs. We won’t know where the next change will happen or how it will affect our companies. But we do know that whether it drives us into irrelevance or we thrive and emerge as a leader will depend on the responsiveness of our people. And no company can be responsive when they’re held hostage by standard procedures and bureaucratic decisions.

Give people control until it makes you uncomfortable. Then give them a little more.

Be Optimistic about the Future.

“Perpetual optimism is a force multiplier.” — Colin Powell

Just as the best cyclists look forward to the hills, great leaders see change as an opportunity. They’re constantly looking for the chance to exploit a situation and increase their advantage. Because of this, great leaders promote a sense of optimism about the future.

Optimism doesn’t mean blindly believing that everything will work out. That produces the same resignation as hopeless despair, neither instills a motive to drive ourselves and those around us to create something better. Instead, great leaders are hopeful and maintain a positive outlook for the future of the world. When others see this, they can’t help but share that perspective.

It’s easy to focus on what’s going wrong and what we can no longer do. It’s much more effective to focus on what we can do. One mindset keeps us looking back, the other gives us actions to move forward.

The past year won’t be the last one full of turmoil and change. But whatever happens, remain optimistic. Optimistic leaders are better leaders. They help inspire those around them to be better versions of themselves.

There’s no better type of leadership to which we should all aspire.