On June 21, 2013, in the Huairou District on the outskirts of Beijing, an American CEO, Chip Starnes of Specialty Medical Supplies, was taken hostage by the company’s local workers. Perhaps a modern day “shot heard round the world” with regard to the inversion of power in the workplace, this event may serve as a wakeup call for CEOs in companies everywhere.
With the seismic demographic shift in the global workforce and the dramatic increase in empowerment of workers, the “clear-and-present” call to action is about the urgent need for managers to adapt to a culture of inclusive leadership. As this dramatic incident illustrates, there is danger in failing to do so. Fortunately, for most organizations, that danger will generally be less a hostage situation than an erosion in the social compact between worker and employer.
The body of knowledge around leadership likely dates back to the Stone Age—when size and strength were the prerequisites for leading. Over the years, the notion of leadership has been analyzed endlessly, most often focusing on the personal traits, behaviors, and experiences of those engaged in leadership roles. But effective leadership is inexorably connected to the context, and today the dramatic change under way in the workforce demands a new perspective on how leaders must lead.
For the most part, the evolving best practices related to leadership have been “inside out.” The focus over the last century has been primarily on the traditional “command-and-control” culture where managers and their organizations seem comfortable. Historically, titled supervisors called the shots and the minions saluted. If followers responded without too much pushback, this was better. Title trumped reason; seniority often dominated ingenuity.
Hierarchical management has existed literally for centuries—feudal empires and a multitude of corporate dynasties have survived, even thrived, on the notion that leaders lead and everyone else follows. But a seismic demographic shift in the global workplace has caused an inversion of power. A confluence of contextual factors has changed the game. And, Inclusive Leadership may be the antidote.
How has the workplace changed? The context within which leaders lead has become profoundly different for a variety of reasons:
• The Internet has given everyone a voice and the means and the power to participate
• Gen Yers, who are by nature “participative,” have entered the workforce en masse and 46% of them are multicultural
• The globalization of the workforce and customer base has created the ability for a broader reach while revealing diverse needs and multiple voices
• New technologies have provided new channels and pathways for communicating that take place with or without formal leaders.
Any one of these factors, alone, would be challenging, but not revolutionary. It is the confluence of these factors—which Sandy Hoffman, Chief Diversity Office at Cisco, calls “the collision points” that require inclusion—occurring while 132 companies on the Fortune Global 500 list are headquartered in the U.S. China (at 89) and Japan (at 62) are not far behind.
Those that continue to hold the top spots on the Fortune 500 Global and Fortune 500 lists represent primarily legacy firms (with the exception of Apple). But there is more to the story. Only 67 companies appeared on the lists in both 1955 and 2011. Many have fallen off the lists, succumbing to the lethal combination of the web 2.0 revolution, financial crises, and the never-diminishing effect of Moore’s law—the reality that the pace of change is now exponential. Many have also fallen off the face of the earth—iconic firms like Compaq, Woolworth’s, and Standard Oil, among others, no longer exist. Why? They failed to adapt their culture to the changing landscape, internally and externally, and they failed to recognize that their past success did not guarantee future success. Regardless of how brilliant their leaders may have been at one point, the turbulent environment in which leaders found themselves meant that they could be knocked from their perches—or off the face of the earth—in mere months.
The demographic evolution that has been taking place in America and elsewhere over the past several years has had an irrevocable impact on the types of leaders needed to move businesses forward successfully. But there is a significant gap between the types of leaders needed and those currently at the helm of most organizations.
Most recently, the economic climate in the U.S. caused many organizations to move into survival mode, shifting their attention away from initiatives that could capture the voices and reap the innovation of their diverse workforces. As the economy shows signs of improvement, some organizations have come back to the realization that without engaged employees whose efforts can yield engaged customers bottom lines won’t budge.
So what it will take for a business leader to succeed in the 21st century is vastly different from what it took to succeed in the past. For leaders to ensure that businesses compete effectively in an increasingly diverse global economy, they must now be firmly focused on business initiatives that will result in more engaged employees and, in turn, more engaged and loyal customers.
NOW: It’s About Including People
Becoming an inclusive leader is not about counting—it’s about including. While many of us have learned that counting people, alone, doesn’t work, we’ve also learned that including people does. It doesn’t matter how many pink, purple, or green people you have on staff if leadership is not capturing the insights, input, and innovations of those people. Inclusion is the new business imperative. Inclusion is what will lead to real business growth on a global scale.
Inclusive leaders know that their success depends on the input of people. They know that it is critical to ensure that all of their employees have a voice. Many great ideas can emerge from the mailroom as well as the boardroom!
In summary, consider the following in evaluating the opportunity to shift the culture of leadership within your organization to be more inclusive:
• Significant environment shifts—demographics, technology, and globalization—are having a dramatic impact on the workplace and the old ways of leading no longer work. Inclusive leaders must exhibit new traits and behaviors to drive their companies to success.
• Past performance no longer predicts future success; continual innovation is a must and benefits from input from a wide range of perspectives
• Command and control leadership behaviors from yesteryear will not lead to the levels of engagement required for companies to succeed in today’s business environment
• A global economy — regardless of whether your company is a global business—is having profound implications on how people should be managed and led
• These massive shifts require a concerted, and continued, effort from leaders who are committed to being inclusive