03.11
WHAT LEADERSHIP IDEAL IS NECESSARY FOR COMPANIES TO SUCCEED IN THE NEW COMPLEX REALITY?
The role of leadership is undergoing significant changes in recent years. This is largely due to the global challenges we face and the shift in societal values that is a consequence of these challenges, which naturally reflects internally within and around organizations and among their stakeholders.
One could argue that the way leaders are selected and evaluated often seems out of sync with the extensive changes that leaders must navigate and operate within. The majority of traditional methods for leadership assessment and selection often reflect a too generic and outdated view of the leadership role.
The assessment tools and paradigms are generally based on theories, and frameworks that are 40-50 years old and are built on previous experiences and culture that do not necessarily align with today's diversity needs, potentially limiting the inclusion of different leadership types and perspectives as well as limiting the focus on soft skills and behavioral competences. Basically, they lack adaptation to modern work environment: the principle is typically that the role of a leader is to lead a company that develops linearly, and is characterized by a structure that is fundamentally systemically hierarchical. Focus is typically on the individual leader's own performance, even though successful leadership is often about building and strengthening well-functioning, and highly collaborative, and innovative teams. This can result in an incomplete picture of the leader’s actual ability to inspire and impact the team in a complex environment.
The challenge is that companies today are an integrated part of a dynamic ecosystem that extends far beyond the linear fundamental principle of business operations. Complexity and unpredictability are now parameters that are central to business operations. This means that companies, leaders, and organizations today must manage a wide range of uncontrollable factors in play, where the ability to navigate an unpredictable multidimensional context is an indispensable requirement for the company's survival, innovation, and development. Companies can no longer be run as systemic hierarchies focused on short-term and narrowly defined performance goals created to optimize in a linear business context limited to direct value chain optimization.
The question we must ask is: What kind of leadership ideal is necessary for companies to succeed in this new complex reality?
A shift in values
In a complex world, it becomes clear that traditional hierarchies are losing their significance. Instead, we see new leadership models emerging.
The ideal leader of tomorrow is not necessarily the authoritarian figure who dictates orders from the top of the hierarchy. Instead, we see a leader who is more for the group than for the individual performance, where the focus is on creating a psychologically safe and inclusive culture.
The successful leader of tomorrow must understand that the organization’s collective knowledge, innovation, and cohesion are fundamental to the company's future success. Collaboration, knowledge sharing, and community are critical factors, and these can only be expressed when the leader is able to facilitate rather than monitor and control. In other words, we need to move away from the old-fashioned "command-and-control" leader who leads upward and pleases upward.
Leadership as a reflection of global challenges and societal values
The leadership qualities we must seek should, as mentioned, reflect the global challenges we face and the shift in societal values that follows. These are qualities that enable understanding and prioritizing the value of the whole person, the sense of community within the organization, and the company’s broader role in a much larger societal ecosystem, rather than a narrow focus on an individual performance-driven culture. It is the ability to see that the organization’s true value lies in its diversity and the perspectives that these differences bring.
The leader must be able to harness and build upon all the strengths and contributions within the organization, rather than enforcing uniformity or insisting on top-down coordination. The modern leadership ideal requires integrity, humility, and self-awareness. A leader should be able to foster security and transparency, be open to criticism, and have the courage to show vulnerability. These qualities are not only essential for the leader’s personal growth but are also key to creating a fearless, trust-based organization where employees feel seen, heard, and valued, and where joy, creativity, and innovation can thrive fully.
We need qualities such as empathy, the ability to listen, an awareness of details and mood, and the skill to engage and balance a myriad of needs, desires, ideas, and dreams each day. The ability to communicate clearly and to inspire now defines leadership. This outside-in approach, where the leader puts themselves on the line and directs ambition toward the team rather than their own ego, breaks with the notion of power as a means of control and a singular focus on personal status. The power, and the privilege that comes with it, lie in the opportunity to facilitate and create the necessary space for free thinking and creativity, thereby fostering self-leadership and responsibility throughout the organization.
Instead of traditional power-driven leaders who practice leadership based on hierarchical power, autocratic authority, surveillance, distancing, and manipulation, we should prioritize selecting and developing leaders who, through humble charisma and natural, unpretentious authority, and genuine interest in people, support and develop employees rather than merely exercising power.
Moving away from the “Dark Triad of Leadership"
The leader’s approach to power is, as described, a key difference between the new and the old leadership styles. Autocratic and authoritarian leadership can create an environment of fear and control, detrimental to innovation and employee well-being. This is disastrous for an organization, as the greatest asset for a company in today’s complex and unpredictable world is highly skilled employees with knowledge, motivation, visions, and insight.
A number of international studies indicate that the traditional power-driven leadership role, which has been predominant since the industrialization and is still seen in many companies, often includes traits associated with psychopathy, narcissism, and Machiavellianism – commonly referred to as the “Dark Triad of leadership".
Leaders with these traits typically appear preoccupied with their own success, which negatively affects employee well-being and motivation. Equally important, this behavior is stifling to all creativity and innovation within the organization. Leaders who monitor, practice micromanagement, and criticize their organization and employees drain the courage and desire of the organization to take risks – the courage that is crucial for innovation, development, and learning.
To navigate effectively in the new global challenges and societal trends, we need leaders who possess self-awareness and the ability to keep themselves in check. These are leaders who identify cultural bearers and build upon them, focusing on regenerative leadership. They see the company as an organism rather than a production unit and understand that “rocking” the details can lead to the collapse of the community. These are leaders who instill courage in individual employees to be themselves and to contribute in their unique way. In other words, the leader is the beacon of culture, with the primary task of ensuring that the culture, the values, and the adaptability do not wane.
We must challenge the principle that leadership should be a reward and recognition for selfish generalists in a system where those who conform to the performance culture and the demand for self-optimization – and who are capable of asserting themselves at the expense of the majority and the group – receive recognition and reward.
It is necessary to demand that leaders and leadership teams orient themselves more towards the outside world and less towards themselves. This also means that individual leaders within a leadership team should orient themselves more towards the group and group dynamics than towards themselves. If this orientation towards the outside world is not prioritized, leaders will lose the respect of their environment. The result is a less strong workplace culture and, consequently, worse results and missed opportunities for the company.
To move away from the old leadership style and role, and thus challenge the "Dark Triad of leadership", it is essential to minimize the power distance in relation to leadership. When the power distance is large, employees will not challenge or be critical of those in power, and they expect power holders to dictate what employees should do. An organization with a large power distance is often characterized by insecurity, poor mental working environment, management by fear, a focus on individual performance rewards, and similar issues, which are directly harmful to psychological safety, openness, teamwork, self-leadership, motivation, innovation, and idea generation, thus creating a total blockage against a leadership approach that sees that the organization’s true value lies in its diversity and the perspectives that these differences bring.
Focus on the self-sustaining organization
In the effort to minimize the power distance and strengthen the idea of self-sustaining organizations, servant leadership is a leadership approach worth examining.
Servant leadership has its roots in the 1970s and is about putting employees first and creating a community where everyone feels included and respected. In servant leadership, the leader is seen as a facilitator who takes responsibility for employees' well-being and development. Employees reporting to servant leaders typically experience greater job satisfaction because these employees are seen as whole people with the freedom to practice self-leadership and take initiatives, rather than merely being viewed as production units. Servant leadership is particularly applicable in companies that wish to build strong, self-sustaining organizations capable of navigating complex social and economic landscapes. This approach is used by companies such as Marriott Hotels, Maersk, Novo Nordisk, and Lego, all of which prioritize sustainability as a strategic focus area.
The leader as a facilitator in a complex ecosystem
To fully understand the leadership ideal of tomorrow, it is necessary to take a deeper look at the very context in which leaders must navigate and function. What is it in the environment that necessitates modern leadership to distance itself from autocratic and authoritarian "top-down" leadership and thus confront the concept of the "alpha leader"?
The answer can be found in the complexity, uncertainty, unpredictability, and multi-stakeholder ecosystem that the organization is expected to succeed in. Complexity theory (Complex Adaptive Systems, CAS) can help articulate this.
From a leadership perspective, complexity theory is an approach to understanding and leading organizations that operate in uncertain, dynamic, and interconnected environments. Unlike traditional leadership, which often assumes that organizations can be controlled, and results predicted, complexity theory recognizes that organizations are complex, adaptive systems where individual actors (people, teams, departments) interact in ways that lead to new behavioral patterns and outcomes, often beyond direct control. This is precisely the world that leaders of tomorrow must relate to and be able to navigate. According to the complexity theory, this requires leaders to understand that results are not always linear or predictable. Minor actions can lead to significant changes, while substantial efforts may sometimes have limited visible effects.
Fundamentally, leaders must ensure that the organization is characterized by continuous adaptability and innovation capabilities and dynamically evolving processes rather than rigid hierarchical and systemic control. Thus, the leadership focus shifts from being "command-and-control" to being facilitative. And with the facilitator role come new demands for skills, abilities, and capabilities as previously outlined.
A new narrative on leadership
We thus return to the question of how we select and develop leaders. Due to the complexity, uncertainty, unpredictability, and multi-stakeholder ecosystem that organizations are expected to succeed in, we must challenge the tendency to hire leaders who reflect ourselves. Leaders should be evaluated and hired based on their ability to function effectively as facilitators, motivators, and cultural beacons in the new complex world that the organization is part of.
We must avoid having leadership roles filled by those who merely fit into a stereotypical image of the "strong and powerful" leader, as this inevitably creates an echo chamber and prevents the organization from developing and adapting in a complex and unpredictable world in constant change.
The modern leadership role requires not only professional qualifications but also soft skills, significant human insight and self-awareness. To develop future leaders, we must create a new narrative about what leadership entails. Leadership is no longer about controlling and monitoring people; rather, it is about being an authentic and present resource for them. Through understanding, empathy, and collaboration, the modern leader can create an organization that thrives in harmony and ensures sustainable growth for both people and the company.