Difficult times like these can stress the skills of the most experienced leader. It’s tempting to look to experts for guidance in creating a path to safety and prosperity for our companies and our families. Yet there are so many experts, how to chose among them – and how useful will their advice be? Can we be our own best expert in prospering in our current economic environment?

Key Leadership Skill: Choosing the Right Experts

Choosing the right experts to help us requires either blind luck or an understanding of the decision-making environment we face. Given that few of us want to risk anything beyond discretionary cash to blind luck, let’s review the characteristics of today’s economy and see if we can identify the right decision-making environment:

• The economy is being hit by bad news frequently, often from a new direction. In other words, we’ve identified some causes, but not all of them, and we keep seeing new, unexpected effects.
• The mechanisms that were supposed to keep our economy under control failed to do so.
• The Secretary of the Treasury and the Chairman of the Federal Reserve were surprised at how rapidly things got out of control.
• Someone has a problem with every corrective action that is suggested.
• The turbulence is worldwide, therefore not all of the emerging problems can be addressed within the US.

I’m sure we can create a much longer list, but how do these items stack up against the four decision-making environments in Table 1?

• Simple is where we write procedures and let our workers handle the situation without our involvement.
• Complicated is where we have people with special knowledge determine the right way to do things. This is the realm of our managers and our run-of–the-mill outside consultants.
• Complex is where tough decisions are made. We are stepping into the wilderness with no path to follow, but hopefully we have some tools like a compass to set our direction. This is where we look to leaders (especially ourselves) and to consultants who specialize in the process of identifying the right questions. Once we see a pattern and know the right questions, we can agonize over developing answers that we hope will work for us. This is easier to do if we have created a vision of where we want to go.
• Chaos is a decision-making realm in which we must do something NOW without knowing for sure it will help, otherwise, our situation is likely to get worse. There is no time to study the issues in a committee, there’s a grizzly bear standing right in front of us and we suspect there’s a cliff nearby.

It appears that our economy has slipped into the world of chaos. Turbulence is growing and none of the measures taken to date show much evidence of taming the beast. We don’t know what is going to happen in the next several months or year, so we can’t know with any surety what we should do to prosper during this period. What we hope is that our leaders will see something emerging from the chaos with enough clarity that they can turn that action-area into something merely complex, where tough decisions can be made that will lead to more stability.

Seasoned Leaders Will Look for Diverse Expertise

What we need are experts that can help us envision what might happen to our economy, our industry and our market and how to profit from it. Unless you are an extremely unusual person, it’s not likely you can be your own best expert in all these areas. Even if you think you can, it helps to get the opinions of other experts.

Given the unknowable nature of this recession, we will do best accessing the expertise of a wide variety of sources to help our businesses. Betting solely on folks who are experts in our industry is likely to blind us to how other areas of the economy and the markets may impact us. We are not likely to recognize disruptive events and emerging patterns that will impact our market and our industry.

In this time where more disruptive events are likely to appear, reach out widely in seeking expert advice. Get opinions from multiple experts on the economy, your industry, your customers’ industries and your market before building your business plans. Recognize that no one has the inside tract on what is going to happen and anyone who claims to know is likely to be allowing their own expertise to delude them. Above all, seek out the support of an expert explorer of chaotic environments, typically an experienced and broadly-trained executive coach.

Seasoned leaders will not attempt to go it alone. They will regularly seek out experts with diverse opinions and a wide range of backgrounds to enrich their thoughts on how their vision and company may be affected by the chaotic economy. Risk management may be the ultimate competition advantage through this recession.

(note: We will emerge from chaos regardless of whether the government makes the “right” decisions now. The question is whether we will emerge from chaos in the near term - or as much as a decade from now. That is what happened in the Great Depression of the 1930’s - and that is a condition I hope we do not repeat.)

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Reference

Snowden, D. and Boone, M. A leader’s framework for decision-making. Harvard Business Review, Nov. 2007, 85(11). pp 69-76.