Failing Fast vs Failing Slow at Management

Leadership is a team sport and is complex and evolving, so one size most definitely does not fit all problems.

Many managers make a common mistake: carrying on with what has worked for them in the past, irrespective of the change around them. Typically, these managers will be used to operating when times are good - when time, information and resources are abundant and everyone feels comfortable. The reality is that the good times don't go on forever. Inevitably, people make mistakes, poor business decisions get made, the macro or micro market turns against you, your largest clients leave you, or a competitor poaches one of your most talented salespeople, etc. At times like this, the people who are only effective peacetime operators are quickly found wanting. Unfortunately, unless the manager quickly adapts to the new reality, the impact on everyone around the peacetime managers will be severe and damaging.

"The number-one way that executives fail is by continuing to do their old job rather than moving on to their new job."

Ben Horowitz

Sometimes, a good old command-and-control leadership style—shunned when times are good and people's feelings seem to be the most important thing—is acceptable and best for the team's and business's survival. For example, if your house is on fire, barking orders to get people safely out of the structure is the most effective way. Coaching people out of the house will lead to casualties.

Context is crucial.

Situational awareness is critical.

Adapting Leadership Styles

In the future, when you reflect on your career, the hope is that there will be more ups than downs, more wins than losses, lasting friendships will have formed, and professionally speaking, you will leave things in better shape than when you found them. Looking back at the first half of my career, which consisted of over twenty years working in top-tier professional and financial services organisations, I can confidently claim it was successful. However, my professional journey was anything but smooth, as during that time, the modern global economies went through several bouts of significant turmoil, such as the dot.com boom and bust and the global financial crisis. Looking back, I can categorically say that my ability to adapt to these situations was essential in my transition from a junior manager to becoming a successful leader. The career-changing wartime events that helped shape my professional success include:

• Accounting fraud and bankruptcy - Enron 2001

• Global financial crisis - 2008 to 2010

• The collapse in revenues for fixed-income markets - 2016

And, of course, the most recent significant event must be the global COVID-19 pandemic and the lockdowns that have impacted almost everyone's way of life. Fortunately, not every crisis you will experience during your career will be of the magnitude of COVID-19. They will fall somewhere along the peacetime to wartime continuum. Ben Horowitz, in the book The Hard Thing About Hard Things, defines the two extremes:

Peacetime: Running a business during peacetime is when you have a large advantage over the competition in your core market.

Wartime: Running a business during wartime is when a company fends off an imminent existential threat.

He explains, "Peacetime and wartime management techniques can be both highly effective when employed in the right situation, but they are different." Using the earlier example of a house on fire, a wartime management approach should be used to safely get people out of the burning home. A peacetime approach that accepts mistakes and views them as learning opportunities would not safely get people away from the flames.

Navigating Organisational Climates

Whilst Horrowitz describes the most extreme situations, I like the war versus peace analogy and have used it with my coaching clients and, before that, to mobilise teams to respond to conditions such as an upset client or mitigate a material risk management weakness. Wartime management is managing a team when there are no easy answers. Here are examples of some common crises that will require you to adopt a wartime approach:

When you hear about Leader as Coach being the most desirable way to lead or A company replaced all of its managers with coaches, I guarantee that these decision-makers are experiencing a peacetime boom. It is a myth that one-size-fits-all when it comes to management and leadership.

The command and control styles are more likely to succeed when facing compressed time frames that require acting quickly using imperfect information. This is shown in the bottom left quadrant of the diagram below. Suppose you have an angry client, an incoming large client opportunity, an unexpected change to a project, or a trading algorithm that isn't executing as anticipated. In that case, you must mobilise to address the opportunity or tackle the issue. Post-mortems and other reviews should take place after the event to ensure learning opportunities are captured and shared. This is because the primary criterion for success is to act rapidly.

In contrast, the secondary success criteria of learning should occur after the event. When the timescales extend, you are more likely to be in peacetime. Hence, coaching to learn is more effective, as displayed in the top right quadrant below.

Managers fail fast by not recognising they are at war. This is peacetime management taking place without considering the situational context, i.e., in the top left quadrant.

Managers will fail slowly by not returning from the constant firefighting modes of wartime. These managers are constantly going from one crisis to another because, even though the future issues are apparent to most people, the managers never proactively address the problems and hence avoid the inevitable. There are many reasons for this situation arising. Often, the managers are rewarded for what they publicly and loudly fix rather than for what they quietly deal with without much fanfare. Others may enjoy the rush of running around with their hair on fire.

Context is crucial.

Situational awareness is critical.

Leadership is a team sport and is complex and evolving, so one size most definitely does not fit all problems.

We all need more than one tool in our managerial toolkit.

📫 - A quote that I am currently pondering

"You can't stumble if you're not in motion."

Richard Carlton, 3M

🤔 - If you did have the answer to this question, what would it be?

What are you pretending not to know?