Why Uncertainty Is the Defining Leadership Skill of This Decade, with Rebecca Homkes

Speaker A: M welcome to the HCI family of podcasts where your source for personal, professional and organizational growth and development. We share our own original research, explore industry trends and interview executives and thought leaders from across the globe. Join us for practitioner oriented content around all things leadership, hr, talent management, organizational development and change management. Maximize your personal and organizational potential with the HCI family of podcasts. Rebecca Humkus, welcome to the conversation today.

Speaker B: Thank you so much for having me.

Speaker A: It is a real pleasure to be with you. You're joining us from New York, I'm south of Salt Lake City in Utah. And today we're going to be talking about why uncertainty is the defining leadership skill of this decade. And uh, certainly we live in complex times. Uh, disruption is the name of the game. Uh, we live in exponential change happening all around us. Societal, political, technological. The uh, workplace is shifting, the economy is shifting right under our feet. Uh, the world of work is changing all around us. And so being a leader has always been challenging of course, but um, being a leader now I think is extra challenging in trying to be there for your people and support your people and build your teams and your bench strength and while also producing results in this situation right now in this um, state is particularly challenging. And I think it's only going to become more challenging as the decade moves on. Uh, so this is what we're going to unpack and explore together today. As we get started. I wanted to share Rebecca's bio with everybody. Dr. Rebecca Homkus is high growth strategy specialist and the founder of a boutique consultancy firm advising CEOs and executive executive teams focused on growth and success through uncertainty. She is a faculty at Duke, Corporate Executive Education Lecturer at the London Business School, executive education advisor and faculty at the bcgu, and previous fellow at the London School of Economics center for economic performance. Dr. Humpkus is also the Director of the Young President's Organization Globe Active Learning Program, a former partner at Global GrowthX, a Silicon Valley investment ecosystem and innovation consultancy, and the faculty lead of Fintech Scale Up Accelerators. A global keynote speaker, she is a member of several advisory boards, directed the joint McKinsey Co LSE center for Economic Performance Global Management project from UH 2007 to 2014 and has regularly been featured in the Harvard Business Review, UH cnbc, Bloomberg, Fortune and Forbes. And as much as I just shared, that's only scratching the surface. There's so much about Rebecca's background, so many great accomplishments, many um, great accolades. You've done so many cool things. Uh, but I want to pause there. Anything that you would like to highlight, uh, by way of your background, m. Personal context or the work that you do before we launch on into this conversation?

Speaker B: No, not at all. I, um, spend every day working with CEOs and executive teams who want to grow. That's developing, executing and innovating on strategy, which of course increasingly means incorporating AI into that and specialize. Especially when there's times of extreme uncertainty.

Speaker A: Awesome. Yeah. And like I mentioned in the opening, uh, we live in those times, don't we? Extreme, Extreme uncertainty is the name of the game, uh, currently. Um, and I think one of the challenges, I mean, there's many challenges around uncertainty. But one of the challenges is we often find ourselves in the trap of analysis paralysis. Um, we like to bring in as much information as we can. We want to, you know, try to predict the future as best we can, but nobody has a crystal ball. Um, and there's infinite variables happening all around us. Um, and so, yeah, we often just get stuck in this analysis paralysis. Um, why is that so dangerous? And you know, of course I want to make data informed decisions and I don't want to make haphazard decisions. Um, but talk us through that a little bit.

Speaker B: Yeah, it's a real trap because when we're facing uncertainty, which it's cliche to say, John, but uncertainty is the new certainty. We need to stop hearing phrases with leadership teams about when they return to X or returning to Y. Like we're not returning to anything. Right. We are in the situation, environment we're in and we need to get great at that. And I think that's one word phrasing that we need to kind of move away from is that when facing uncertainty, I see three common responses. The first is actually just what I call delusion in that we've made a plan, we've communicated the plan, and we, we have an entire generation of leaders that were raised in the notion of that once you have a plan and you've made a commitment, you must hold your commitments. And this is becoming very damaging in the current time because they'll say, well, I've already communicated the plan. The board already knows the plan. I've heard as silly things as well. We've already printed the posters with the new strategy. We got to keep going. And it sounds silly, but this is what established executives are saying. And that's delusion. We need to move beyond the notion that once we've made a strategy or set of plans, we got it right, we have to move away from that notion. But the second one is what you flagged is this paralysis where we always give an artificial deadline of when we'll supposedly have more certainty. Now let's wait till after the tariff decision, let's wait till after the war ends. And these are artificial deadlines. We will not necessarily have more certainty when those happen. And the thing about these holding patterns, why they're so damaging is it's not just because you're moving slower. The real reason this constant paralysis is damaging to growth is that uh, growth and performance are a muscle way. And every time you delay and delay execution, you're actually losing the muscle at the team. And it's kind of like if you work out every day and then you stop working out and go to the gym tomorrow expecting a great workout, it's going to be terrible if you took three months off. And that's what we're doing to our teams. So the notion is we need to make decisions based on beliefs, not waiting for established facts. Now making decisions based on beliefs can still be data informed. We use data to articulate, uh, our beliefs, to test our beliefs. But once we've got a belief, we need to move into something called parallel pathing. Well, I'm testing my belief while I am executing, but I'm going to get feedback and as I get feedback I'm going to adjust and go as I work. So making decisions based on beliefs, not established facts, can include data. But I've also got to start moving. That's why I say we've got to embrace this notion of parallel pathing and move away from everything must be sequential, right?

Speaker A: Yeah. I love the parallel pathing. And there's a lot of talk around simply doing scenario based planning, data informed scenario planning. Obviously we don't, we don't know the future, we don't know which scenario is going to play out. All of our scenarios might be wrong. Um, and, and just because we scenario plan today doesn't mean, you know, what we're planning for today is going to play out six months from now or a year from now. Right. The tariffs, you know, the situation might change, the war might change, the, you know, um, a thousand variables might change, you know, and so we just don't change.

Speaker B: Yeah. And what I found m about scenario planning is that we tend to think about what could go wrong and that when we do scenarios and kind of we ask what could happen, we tend to default into risks. And if you listen to it, we sometimes speak about scenarios as risk or kind of challenges that we need to overcome, which is scenario planning is great as long as you think about the kickers as well as the killers, if there's a bell curve, if you kind of think about all of the probability set coming in a bell curve, we tend to, the only extreme scenarios we tend to think about are the killers. And actually where we need to practice and build that brain aptitude is those, what would I call, the kickers. So yes, those scenarios where there's extreme upside as well. So scenario planning is great, but you've got to take it to the next step. Uh, too many teams do scenario planning. They feel good about themselves because they have ideated and then they go to execute a linear plan. But once you've done the scenario plan, you've got to go to the next step as a team and say, okay, based on these scenarios, what are the two or three critical beliefs we're going to take? What are the scenarios that we want to start building capability for or actually executing towards and then start moving from it. So scenario planning is a. Yes. And do the scenario planning and take it to the next step of articulating a belief that you can start acting on.

Speaker A: Yeah. And let's talk, uh, for just a minute about these linear plans. Um, so like the five year strategic plan. Right. The bread and, the bread and butter of, of management and leadership for the last forever. Right. Um, and I talk with leaders all the time about, you know, their, their plans and you know, we, we, I mean it's great to have a plan and it's, I guess it's better to have a plan than to not have any plan. And, and certainly that is where we used to be. We used to be, you know, in a place where nobody had strategic plans. And so then we started to have five year plans. And then, and then we started to have five year rolling strategic plans, which is better because it's more adaptive. Um, but, but we're in a situation now where I still, I still find, um, so many executives who kind of just like what you just said, they're like, well, we have our five year strategic plan. Like, and you know, now we have to pivot. But, but this pivot isn't on the roadmap. It's not on our strategic plan. So we can't do it. So we have, you know, we have to, we have to um, just follow our plan. And if we follow our plan, there's safety in our plan. Um, and maybe there's safety in your plan, but there also could be extreme danger in your plan because you're delusional. Like you said, you're uh, head in the sand, ignoring everything that's happening around you.

Speaker B: So much so. And actually one of the traps I look out for is one of the scariest things that a leader can say to me is if they tell me they're in heads down execution mode, you're going to get in trouble for me if you tell me that. Because we pride ourselves on being in heads and execution mode. But being in heads and execution mode means I'm just going to implement the plan where I need leaders in heads up learning mode. Yes, I have a framework or a parameter of things that I'm executing, but I'm open to my beliefs being wrong, I'm open to getting new insights. And I've been really thinking about this a lot is that agility is a methodology. We often think, oh, you can have a strategy or you can be agile. That's not the case at all. Agility is based on methodology. The most agile companies have their beliefs. They have methodologies for how they test their beliefs, beliefs, they have parameters about how they build change into their strategy. So we need to stop assuming that having a strategy and being agile are opposite. They actually live together. You know, the definition of agility is making good decisions quickly aligned with strategy. So there was one of the, you know, very famous generals who used the phrase, John, that it was, you know, plans are worthless, but planning is everything. And that's still kind of true for strategies. You know, my personal belief is five years is a bit too long. Um, and I work with some of the biggest companies in the world. The big energy company, cpg. Three years tends to be about the sweet spot, but you need to do rolling strategies. So one cycle, three years, two cycles, six years. But I'm also open right to this parallel pathing. As I learn, I might deprioritize something and put something back up. And practically a little change you can make that makes a big difference is when you get together with your teams to review your strategy. We tend to start these review meetings with the question, are we on track to plan? That tends to be how we start our review meetings. And what I found is that asking that question, you're taking the implicit assumption there was only one track and we got it right the first time. And that's not the assumption you should have. But the scarier thing if you're a leader is that when you start a meeting with the question, are we on track to plan? If I'm someone on your team, I might be coming to that meeting with a lesson, with an insight, with something I'm learning from my customers with a change I want to make. But now that you've asked that question to start, I'm now going to backtrack into defensive mode and justify how I'm going to get back on track. So we actually close growth mindsets of our teams when we start every meeting asking about whether or not we're on track to plan. So I like to start with, has this situation changed? I'm giving this purposeful pause to say, has there been a shift? I'm welcome to the learnings and a lot of times it hasn't. Great, let's go talk about the plan. But that's something that we really need to integrate. Just that one question in at the start of our meeting, can I ask,

Speaker A: like, how do you approach leaders who seem pretty dug in to, to their, to their plan, like their five year plan? Like I was talking with a leader recently, they were very, I mean and I, uh, should say they've been very successful. Like their organization's successful. They've done a very good job with their strategy, they've done a very good job with their execution. And in part because of that success, you know, they are very confident in their approach and they're very confident in, you know, like the heads down mode that you're talking about. Like they have their five year plan and they're like in year three of execute. So they're, they're, they're not even revisiting anything. They're, they're just in execute mode, um, and they have been in execute mode for multiple years. And they're like in my mind, that kind of blows my mind. Uh, like I'm like, how are you not constantly revisiting? And like you said, maybe things haven't changed and maybe, maybe you are just going to continue to execute. But it seems like you have to at least be continually opening yourself up to the possibility and having those conversations and revisiting. Um, because you can find yourself in extreme danger if you're constantly head down in execute mode. Uh, and then things pop up and all of a sudden you find yourself surprised, uh, because what you planned five years ago may have no relevance. I mean it could potentially have very little relevance. You know, five years down the line, um, and you could execute the crap out of that plan. Like you, I mean you could have the best execution ever and still, you know, fail because, because it's just not relevant anymore. Like, so how do you approach that when you, when you're talking to leaders

Speaker B: at a highest level? John, this Is the difference between a performance company and a growth company and they're not the same is that some of the companies that struggle the most with growing through uncertainty are those who really pride themselves on high performance culture. Because a high performance culture is having clear targets, executing the targets, recognizing rewarding, working hard and hitting the targets. And in successful high growth companies you can have plans that are tracking green that we turn off because they're no longer the most important strategic priority. And I've got to reallocate resources and this is a fundamentally different cultural thing. So again, if you pride yourself on being high performance, ask am I recognized rewarding hard work and hitting numbers? Am I recognizing rewarding, finding insights, adapting for those insights and executing that way. Now ideally I meet the leader before the next strategy cycle so we can build the beliefs in but if not, I just like to ask a very simple question is that ah, if we, we tend to sometimes argue about whether or not a strategy is a good idea and we have too many biases, we have too many frames, the human brain is actually not great at ah, doing strategy, just wasn't really built to do that. And so if you switch the question from is this a good idea? Then we're going to, because we're working on it, we think it's a good idea. And instead ask well, what would have to be true for this strategy to be a great idea? Like what are the variables in the external world, what are the variables in the internal world that all of those variables would have to be true for this to be a great idea. And you switch a conversation which can be emotive and defensive and framed with biases to very practical, like let's just make a list on a flip chart, external and internal, all of the variables that these variables would need to be true for this plan to be a great idea. They want to go through them one by one and ask is this true or can we make it true? And the ones that we don't know we need to test. And that can kind of free something because again it's going to be an emotive conversation if it's something that I'm currently executing.

Speaker A: Yeah, yeah, I love that. And so yeah, I think just being open to having those conversations is always going to be very uh, key.

Speaker B: The number one differentiate in all of this stuff is learning velocity, right? And I was actually having conversations this morning about what sets apart these great CEOs and it came up from I was working with different, different reporters in an event and it was this very clear Common denominator is that like it's the learning velocity. And this is the biggest differentiator in high growth companies. If I look at all the work I've done, all of the research, but more importantly, working directly with teams over more than a decade, the number one differentiator of high growth is learning velocity. Organizations that learn faster, organizations that grow faster. But becoming a learning organization is a different mindset in a different culture. Because I always take the assumption I probably don't have it completely right, here's what I need to test and learn to get it even more right. Whereas a classic assumption is it's right enough. Now it's all about execution. And I would like more folks to move past that. Execution absolutely matters, but not if we're executing the wrong things.

Speaker A: Yeah, yeah, absolutely. Um, I know one thing you talk a lot about is the chaos tax. Yeah, talk to us a little bit about that. You know how, how do leaders accidentally pay this chaos tax task through paralysis, over planning, risk aversion. I mean these are natural things that we all, you know, as humans we tend to, to do and leaders tend to do this. Um, what, you know, talk to us more about that.

Speaker B: Look, chaos has a cost. I cannot be blunter than that. Like when certainty increases in its numbers, in its speed of change, we get into chaos. And the chaos caused is paralysis and decision making. The chaos cost is this delayed decision making. The chaos cost is kind of over resourcing because we're too afraid to make a commitment to three priorities. So we resource 10 of them, wanting to get one of them right. But it means we're starving everything of what it needs. But we also lose trust and credibility when as a leader we're not making commitments and we're not communicating, we're always waiting. We lose some of that trust and credibility in the team, which means we lose our best team members who want to go to another organization as well. So one of the biggest things leaders need to do is commit to not paying the chaos cost, which is I'm going to get great at testing beliefs, then I'm going to make choices based on beliefs. I'm going to identify what I call my no regret moves is that we always have no regret moves. And a no regret move means even if I got my belief wrong, I won't regret making it. I'm going to isolate my kickers and killers versus just looking at everything. But one thing more practically I found John, is that we need to stop moving tools that make things good or bad. Like I don't use swats anymore. I don't do headwinds and tailwinds. Any strategic or management tool that asks you to classify things as good or bad is actually really damaging for a growth mindset. Because now I'm saying, okay, I've got these things that are good, but all of these things that are bad. Every trend in the market is a series of growth opportunities. It's just prioritizing which ones we want to do. So as a leader, chaos has a cost. You are paying it. If you're not being very explicit and committed to not. So you first got to make the commitment not to pay it, then build structures and methodologies across your organization so you do not have to pay this as others are. Ah.

Speaker A: And, and how do you start to move from kind of this, this performance mind, this performance culture, this performance mindset which is good? I mean, everyone wants a high performance, um, output. Right? But there, there's something fundamentally different, as you've described, about performance culture versus a learning culture versus, um, that constant stretching, um, and challenging and leaning into the noise, the chaos, the opportunity. Because again, we, we use the noise, the chaos. These are all negative terms, but they also are synonymous with opportunity and growth.

Speaker B: Chaotic environments open up all of these new growth opportunities. And chaotic environments are amazing because when uncertainty and chaos are high, honesty gets high too. And consumers and customers are much more honest about what they value and what they don't value and the feedback loops in the market. So again, uncertainty is a great time to grow because it's a great time to learn. Because when uncertainty is high, honesty gets high as well. So as a team, there's like a hard, I, uh, call like the hardware and the software. The hardware is processes and tools. We have great processes for tracking goals. But do you have tools where folks can track beliefs? And so where is a place they're capturing insights, they're learning from other people's insights. We've got to give tools and structures there. And then on the software, who are we recognizing Rewarding? You can make this shift in a couple of months. If your employee shoutouts and town halls move from recognizing the guy that came in and worked over the weekend or worked really hard, and instead you recognize reward the team that made a shift, that stopped doing something. Celebrate change and recognize, Reward, learning and change. If you do that, three town halls in a row, you're going to start building this shift. So I found who we recognize reward is the best way to make the shift the fastest.

Speaker A: Yeah. And maybe, maybe this opens things up to a little Bit of like controversy here, but, but you know, some of the things that I think kind of fit with what you're just talking about. So this, you know, who, who you know, uh, worked over the weekend or whatever. But we have a lot of these return to office mandates. You have kind of the butts and seats leadership. Right. So, so people wandering, you know, uh, the wandering around the halls checking who's at their desk style of leadership, um, and kind of facetime in the office style of leadership. Now certainly there's value in being in person and individuals need to understand like you need to be seen, you need to be heard, you need to help people understand what contributions you're making. There's all of this around individuals progressing in their career and making contributions in their team and having, having influence and all that. And that's a whole other conversation. But um, but when we're, when we're thinking about performance, uh, and not just performative performance but like real performance, um, and how that's valued and how that's signaled in the organization and then versus you know, actual growth and actual learning and how that's valued and how that's signaled within the organization. Um, I don't know any thoughts on like how, how you talk with, with executives and leaders, uh, about how those types of things can get reinforced. You know, I, I, I'm wondering, I'm one please. Yeah, yeah. I'm wondering about how like we might inadvertently undermine our desire towards a learning culture. Um, you know, because we might be pushing towards some of these other things that yeah, might, might undermine our efforts

Speaker B: because we are obsessed with tracking, we are obsessed with the stoplight system of our metrics. And there is a, there is an importance to that. Shifting from, starting from are we on track to plan to has a situation changed when I as a CEO am giving a talk or a town hall or just running a meeting with my team? Am I saying here are the two or three insights I want to learn this week? We tend to just say it is like X or Y. We've been kind of trained as leaders. We must know the answers. The job of leaders is to ask the questions. And so shifting into the weekly meeting from what do we do? What do we need to do? But what did we learn last week? What do we need to learn that shift, adding those very two quick agenda points and then role modeling. Here's how I'm testing my assumptions. These micro shifts make a much bigger impact across an organization than any top down mandate.

Speaker A: Yeah, yeah, absolutely. Well Rebecca, I know at the time. I. I know we, uh, could probably go on for a really long time

Speaker B: hours on these topics.

Speaker A: Such a fascinating conversation, but I probably need to let you go and let you get on with your busy day. But before we wrap things up for today, I wanted to give you a chance to share with the audience how they can connect with you, find out more about your work, and then give us a final word for today.

Speaker B: Would love that. Yes. So I wrote a book called Survive, Reset, Thrive, Leading Breakthrough Growth Strategy in Volatile Times, which is available on Amazon or wherever you buy books. And you can also go to my website, Rebecca hump guest.com where I also write a monthly blog that covers a lot of these topics. You can subscribe to there. So either check out the book Survive, Reset, Thrive or just head to rebeccahumkist.com awesome.

Speaker A: Again, Rebecca, thank you so much. It's been a real pleasure. I encourage the audience to reach out, get connected, find out more about what Rebecca can do for you. Check out the book and as always, I hope everyone can stay healthy and safe, that you can find meaning and purpose at work each and every day. And I hope you all have a great week. M thanks for joining us for this episode of the podcast. We hope you stay healthy and safe and please join us again soon.