Uncertainty and the Leadership Advantage

Yesterday’s decision from the Fed to keep interest rates unchanged, while signaling potential future cuts, garnered the expected: a mix of reactions and sentiment from the market. We’re seeing some initial volatility, but also glimmers of optimism. I’m not here to read the tea leaves; there are plenty of experts who will be doing that this week and I’ll certainly be listening with keen interest.

But what I’m reminded of right now is the notion that uncertainty can be driven by any number of factors. Economically those include consumer spending, inflationary pressures and global economic shifts. But what of the impacts of uncertainty on the people who are getting up every morning and just want to continue doing their jobs well, feed their families and maintain a sense of optimism? It’s those folks I have in mind today.

As organizational leaders, it’s essential to navigate the current challenges with resilience and strategic foresight, instilling calm and setting the right tone. In many ways it’s the ultimate leadership test to have the capacity to generate trust and offer guidance when the road is unclear. It’s in these times that good leaders not only respond to change, they funnel it into opportunity.

Over the course of my life, I’ve become something of an expert on embracing the unexpected. The need to get comfortable with being uncomfortable isn’t just a catchphrase, it’s essential for effective leadership, especially in today’s environment.

I also think it’s important to acknowledge that leading through uncertainty is not about having the answers. It’s about knowing which questions to ask. Questions are the bedrock of curiosity and curiosity drives learning and growth. Here are a few I’m asking myself today.

What actionable insights can I offer?

There are reliable strategies for guiding organizations through periods of uncertainty, ensuring sustained progress and resilience.

First, continue to communicate regularly and transparently. Economic challenges can create top and bottom line headaches but they might also yield opportunity. Taking steps to address both builds trust and creates a much-needed sense of security.

Second, adapt and innovate. Incorporating flexibility into your approach to problem solving helps your teams see more clearly and identify potential opportunity while navigating risk. Adaptation is key when obstacles keep popping up.

Third, encourage and support employee well-being. This is very important to me and the business that I run. We work hard to recognize stress triggers and address them proactively through appropriate resources, flexible work arrangements and open communication channels.

Am I setting the right tone?

I like to consider the wake I’m leaving behind, much like a boat does. In times of uncertainty, setting the right tone is crucial for maintaining morale. Leaders must strike a balance between optimism and realism, ensuring that their communication is both encouraging and grounded in reality. Leadership is as much a function of appearance as it is of behavior. Wherever there is ambiguity, people look to their leaders and sometimes peers for how to feel and behave. What to do?

Acknowledge that there are challenges. By acknowledging the reality of any situation, we put ourselves in a better position to prepare, strategize and get future fit.

Promote positivity. I’m not advocating that we wear rose colored goggles. The business landscape may be unpredictable right now, but we are nonetheless committed to our goals and confident in our ability to adapt and identify opportunities.

It’s time to collaborate. We’re very intentional in our organization about nurturing a culture where everyone’s input is valued. I believe in adopting a servant leader mindset at work and at home, regardless of the outside environment. But by working together and supporting each other, we build resilience and drive success.

What are the roles of empathy and clarity?

They are, simply put, essential leadership qualities. While it’s important to be transparent about potential difficulties, people don’t expect leaders to have all the answers. They do expect them to show up, listen and provide clear direction.

When leaders have a strong pulse on team sentiment, they can more easily create a place where everyone feels heard and supported. Leaders who can lead with empathy while clearly conveying a vision will keep their teams motivated and engaged.

Are we considering all key stakeholders?

Borrowing costs are rising, making it more costly to operate, expand and finance investment. It’s likely that our clients and yours are entering a period of strategic decision making and cost management. We can help guide them by opening up opportunities for diversification and helping them streamline processes, maintain operational efficiency and leverage technology. And as we do with our teams, recognize that our clients are also navigating their businesses through a potentially rocky time, and employ that empathy and clarity we just talked about in all interactions with them.

Perseverance not perfection

There are a lot of questions we can be asking right now. But in sum, I think it’s important to remember that strong leaders don’t wait for perfect conditions. They make progress, however small, despite discomfort or doubt. And in doing so, they show their teams that real growth doesn’t come from avoiding hardship, but from consistently choosing to face it.

And while that definitionally captures the essence of perseverance, it’s also important to consider its application in the current economic context.

We’re in a period of heightened uncertainty about the economic outlook. As we’ve covered, this requires leaders to maintain a long-term vision while adapting to short-term challenges. Perseverance in this context means continuously striving towards organizational goals despite economic fluctuations. Remember, each obstacle overcome builds the stamina to tackle the next. The key isn’t to eliminate discomfort, it’s to keep moving through it.

Read more Lessons from Leadership here.