IMD OWP22 PostEvent Report

1 OW P 2 2 RESET FOR SUSTAINABLE AND INCLUSIVE GROWTH

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06 FOREWORD 08 SUSTAINABILITY

Jean-François Manzoni 54 Keynote: Purpose fueled by sustainability: the only package for future success 58

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Q&A: CHANGE BEGINS WITH ME Ben Bryant

IN DEFENSE OF DEMOCRACY David Bach

Q&A: SUCCEEDING IN TECHNOLOGY ENTREPRENEURSHIP Jim Pulcrano Q&A: DON’T BLAME IT ON THE TECH Öykü Işik Q&A: REBUILDING ORGANIZATIONS TO BE RESILIENT Michael Wade WELLBEING Keynote: “Your brain is your biggest asset: live by design, not by default” Q&A: EMBRACING MINDFULNESS TO HELP YOUR TEAMS Anand Narasimhan “We will grow through our people” - how two Danish firms strengthen their top teams at OWP HOW TO OPTIMIZE THE OWP JOURNEY FOR REAL IMPACT David Bach

Q&A: LEADING IN THE NEWNORMAL Shlomo Ben-Hur and Nik Kinley

Q&A: HOWTO ENABLE YOUR FAMILY BUSINESS TO THRIVE Peter Vogel

18 DIGITAL

62 COURAGE: PRACTICAL SOLUTIONS TO HARD PEOPLE PROBLEMS Heather Cairns-Lee and John Weeks

102 HOW TO BE

SUSTAINABILITY FOR PROFIT AND PLANET Julia Binder and Michael Wade

CUSTOMER-LED Seán Meehan

22 Q&A: NAVIGATING THE FUTURE OF CLIMATE CHANGE REGULATION Karl Schmedders 26 Q&A: HOW TO BOOST FINANCE FOR CLIMATE TECH START-UPS Salvatore Cantale 30 DIVERSITY, EQUITY & INCLUSION 34 MANAGING TRICKY LEADERSHIP SITUATIONS Alyson Meister 38 DIVIDE OR INCLUDE? LEADING THROUGH LANGUAGE Heather Cairns-Lee

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Q&A: HOW TO LEAD IN TIMES OF UNCERTAINTY Martin Fellenz

Q&A: TURNING STRATEGY INTO SUCCESS Niccolò Pisani

Q&A: THE POWER OF INFORMATION AND INCENTIVES Karl Schmedders

EFFECTIVEBOARD GOVERNANCE IS ESSENTIALFORSUCCESS Didier Cossin INNOVATION Keynote: Care for your workforce and communities to nurture a sustainable business

158 IMPACT STORY

COMMON SENSE OR COMMON PRACTICE? Heather Cairns-Lee and Sameh Abadir

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STRATEGY Keynote: From heffalumps to invading apes, it’s time to create a “crisis management culture”

Q&A: HOW TO INNOVATE AND COLLABORATE Louise Muhdi

Q&A: LEADING SUPPLY CHAIN AFTER THE BIGGEST DISRUPTION Carlos Cordon

Q&A: BECOMING AN ALIEN: UNLOCK YOUR

CREATIVITY Cyril Bouquet

44 LEADERSHIP

90 Q&A: ALIGNING GROWTH AND PERFORMACE Niccolò Pisani

NAVIGATING THE OPEN ENTERPRISE SYSTEM

Keynote: “Don’t be a bottleneck to change; CEOs must trust the next generation”

Mark Greeven and Patrick Reinmoeller

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400+ EXECUTIVES 30+ NATIONALITIES 15+ INDUSTRIES 40+WORLD- CLASS FACULTY 5 INSPIRING& INTENSE DAYS

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“NEURONS THAT FIRE TOGETHER, WIRE TOGETHER.”

Regularly revisit your OWP notes and reflections to maximize the impact of your learning for you and your organization.

I am encouraging you now to revisit your session notes regularly in the coming weeks and months to really help those neurons to wire together, so that you can reap the greatest benefits from the intense OWP learning experience. This post-event report, based on many of the leading-edge insights shared by our faculty, seeks to provide a further support for you as you bring your new insights to life. We hope you find it a useful companion for your ongoing OWP journey. All the best to you, and until next time,

I was touched by the reflection of one of our participants this week, who shared the insight that, as leaders, we need to strike the balance between patience and impatience: to make sure we are focused both on the long-term game of delivering on our purpose, while also recognizing the need to act with urgency, given the complexity and severity of the challenges we face. Dr. Sahar Nasr’s advice, during her keynote session, to never give up on what you believe in – your principles and ethics as a leader – also resonated deeply as the world strives to adapt to this period of unprecedented uncertainty and disruption.

Dear OWP participant, The June 2022 edition of our signature program Orchestrating Winning Performance felt like the beginning of a new era: a return to the full, in- person experience of this extraordinary week of learning, sharing, and networking. Spurred by the challenges of the pandemic, IMD has found powerful new ways to deliver real impact and learning through the flexibility of the “OWP liVe” virtual program, but there is nothing quite like the buzz of more than 400 international executives congregating at our base camp in Lausanne. It was an inspiring, energizing week. We were honored to host you and your teams as we explored ways to reset for sustainable and inclusive growth.

One of the truly unique benefits of the OWP structure is that, with more than 40 faculty and experts delivering sessions across the full spectrum of business-critical issues, each OWP participant can tailor their learning journey according to their specific needs. At the same time, OWP creates the space in and around sessions to enable diverse people to connect, network, and share perspectives. This means that organizations can empower different teams or individuals to address multiple challenges and opportunities at OWP, while building up their professional networks for future collaboration. To make sure you make the most out of your time at OWP, I wanted to remind you of something I shared with you in Lausanne: neurons that fire together, wire together.

JEAN-FRANÇOIS MANZONI Nestlé Professor of Leadership & Organizational Development and President, IMD

OWP22 highlights

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Sustain- ability

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“THISOWP PROGRAM ISGOING TOBUILDME INTOA FUTURE CEO ANDABETTER LEADER INMY ORGANIZATIONOR INOTHER ORGANIZATIONS.” FAROOKHANIFA Quality Control Supervisor, Siniora Food Industries

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KEYNOTE

PURPOSE FUELED BY SUSTAINABILITY: THE ONLY PACKAGE FOR FUTURE SUCCESS

Sustainability must take center stage in any company’s purpose and CEOs should make big bets on the future to give their organizations the best chance of success, says Tetra Pak CEO Adolfo Orive, offering four leadership traits to drive sustainability- led transformations in a disruptive world.

Keynote highlights

This demands a change in mindset for many CEOs and companies, Adolfo Orive told participants in IMD’s Orchestrating Winning Performance program in his keynote address: to stop seeing sustainability and economic success as a trade-off between conflicting goals, and to see them as necessary and complementary factors in today’s world.

“Sustainability cannot be part of the agenda. It has to be the agenda,” he said. “It doesn’t matter which industry you are in, what type of business you are, who are your customers; sustainability is the agenda that needs to be part of your purpose and part of what you do every day.” He explored five key themes that inform his approach to driving the world’s leading food processing and packaging solutions company as it faces up to the challenges in the industry, such as climate change, circularity, and food insecurity.

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KEYNOTE

“COMPANIES IN THE FUTURE WILL FIND IT DIFFICULT TO OPERATE IF THEY DO NOT HAVE A STRONG SUSTAINABILITY AGENDA SUPPORTED BY FACTS. SUSTAINABILITY HAS BECOME THE LICENCE TO OPERATE.”

“Sustainability used to be ‘either-or’: We focus on sustainability or focus on growth or innovation, but we cannot do everything. That dialogue is no longer valid. Sustainability is an ‘and’, and we need to make sure we change that mindset.” In the context of the food industry, he said the situation was “even more complex”, balancing areas such as a food security, climate change, circularity, and biodiversity.

“We are seeing the end of the era of globalization in the way it has been,” he argued. “The future will be more regionalized and customized. It will also be about different speeds in how the world will evolve and different countries will evolve […] not just about how to balance global versus local, but how to create an organization that is ready for a multi- speed world.” IT’S GETTING HARDER, BUT LEADERS MUST GET BETTER Finally, he said that decision-makers had to evolve their leadership skills to ensure they were equipped for an environment that was not going to “get easier”. “We need to get better,” he said. “We need to unlearn and to learn. What took us here, we can assume most probably, will not take us into the future.” Having joined Tetra Pak in 1993 as a commercial director in his native Mexico, he drew on close to three decades of international leadership roles to share an ABCD of leadership lessons for orchestrating a sustainability- led transformation: Authenticity, Balance, Collaboration, and Diversity.

SUSTAINABILITY IS THE AGENDA, NOT JUST ANOTHER BOX TO TICK “Companies in the future will find it difficult to operate if they do not have a strong sustainability agenda supported by facts,” he said. “Sustainability has become the license to operate.” However, there also needs to be a strong business case for any sustainability-led transformation, he said, adding that more and more CEOs are seeing future competitive advantages in sustainability. THERE IS NO EITHER/OR ANYMORE While some business leaders might continue to view investing in sustainability and growth or innovation as a trade-off, he said executives should focus instead on finding the sweet spot between ‘doing well’ and ‘doing good’.

MAKE BIG BETS ON THE FUTURE Leaders must find a way to join the dots in a highly complex present, while also anticipating and taking risks on future opportunities to carve out competitive advantage. “More today than in the past, the role of CEOs is taking the big bets for the future,” he said. “CEOs need to bet today on what is going to be the future for companies 10 to 15 years from now.” When calculating these big bets in the food industry, he highlighted four indicators to watch: consumer trends centered on convenience, nutrition, and hyper- customization; digital platforms and factories; faster, smarter, and more sustainable tech; and game-changing business models and value sources, such as new sources of protein and lab- grown meat. THE WORLD IS MORE DIVERSE AND MULTI- SPEED THANWE THOUGHT Understanding the markets in which companies operate is crucial. This means grasping global themes and forces, while also appreciating the nuances of regional landscapes.

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BE REAL Be authentic and transparent in qualitative and quantitative terms about what your company is doing and what is achievable. That also means being upfront and honest about any shortcomings or vulnerabilities.

STRIKE A BALANCE We should not strive for perfection in one particular area, given all the variables at play. Rather, CEOs should seek to balance multiple variables – balance the long- and short-term, balance the heart and mind, balance profit and purpose. “We need to unlearn and to learn. What took us here, we can assume most probably, will not take us into the future.”

WORKWITH UNCONVENTIONAL PARTNERS

TAP INTO DIVERSITY “Companies become stronger when you really create the mechanisms inside the company to make it grow,” he explained. “Diversity will be even more important in the future. In order to tap into that richness, we need to embed this into our culture.”

“Everything you post or share now has to be fact- based, and you need to be able to commit to that – not greenwashing,” he said. “CEOs and organizations that, in the past, didn’t allow people to be vulnerable, that were so concerned about failures and exposing themselves, will fail. A CEO and leader that is vulnerable is stronger than CEOs who are distant and protect themselves.”

Collaboration can be a game changer as it allows leaders to pool multiple perspectives and competencies. Think beyond the “traditional”, he said, and engage with unconventional partners, including start-ups and academic institutions. “Widen your horizons as much as you can.”

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DIGITAL SUSTAINABILITY FOR PROFIT AND PLANET

The megatrends of digitization and sustainability are reshaping the business world. By combining both concepts, executives can improve their organizational performance as well as contribute to the future health of the planet. Through “digital sustainability”, leaders no longer have to choose.

Traditionally managed separately, there is an increasing realization that today’s core transformational drivers of digitalization and sustainability must be seen in combination, not isolation. In fact, the European Commission has identified the “European Green Deal” and a “Europe fit for the Digital Age” as its two top priorities – and has acknowledged the important intersection

On the other hand, digital technologies have shown to play a very important role in supporting the transformation toward sustainability. Consider, for instance, how digital technologies have enabled the on-going electrification of the mobility industry, by overcoming infrastructure, charging and customer adoption challenges.

Digitalization intersects with sustainability in two important ways. On the one hand, the environmental, social, and economic impacts of digital technologies raise important questions related to sustainability. Take, for example, the issue of digital pollution, where digital technologies have been found to account for approximately 4% of global CO 2 emissions; or consider the role of social media in the spread of fake news with its destabilizing effect on social cohesion and democratic systems.

by referring to it as the “twin transformation”.

MICHAEL WADE Professor of Innovation and Strategy

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ACTION POINTS

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SEE BETTER Use digital technologies to bring transparency into your organization and supply chain.

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UNDERSTAND BETTER Use digital technologies to analyze and measure your sustainability performance.

ACT BETTER Use digital technologies to improve and scale your sustainability performance.

JULIA BINDER Professor of Sustainable Innovation and Business Transformation

gas emissions, recycling, or reducing packaging (we refer to this as a planet focus). Can both performance and planet objectives be achieved simultaneously? On the surface, they can appear non-complementary. A focus on the planet may come at the expense of performance due to increased compliance costs, or lower efficiency due to additional processing steps or reduced output. At

the same time, a singular focus on performance often results in negative impacts on the planet. We believe that digital tools and technologies, if used in a smart way, can benefit both organizational performance and the planet. We refer to this combination as digital sustainability.

FOCUS ON PERFORMANCE AND PLANET Digitization has largely been focused on economic benefits such as reduced costs, increased revenues, and enhanced agility, with relatively little attention paid to environmental impacts (we call this a performance focus). Sustainability, by contrast, is focused on benefits to the environment, for example, by lowering greenhouse

RECOMMENDED READING

CORPORATE RESPONSIBILITY IN THE DIGITAL ERA By Michael Wade (MIT Sloan Management Review, April 28, 2020)

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Q&A →Sustainability Following dire warnings from scientific experts, companies can expect greater regulation as policymakers act to protect the future of the planet. Executives must adapt now. NAVIGATING THE FUTURE OF CLIMATE CHANGE REGULATION WHAT IS YOUR HOT TOPIC? Due to the increased threat of climate change, the latest Inter-governmental Panel on Climate Change (IPCC) report calls for greater regulation. Companies must take action now to be fully aware of what these new regulations will look like and how they can prepare for a changed regulatory landscape. WHY DOES THIS MATTER NOW? The latest IPCC report presents some dire warnings and calls for immediate responses to climate change. Some new regulations around the world are coming and there are many new initiatives from companies. Forward- looking managers want to get ready now.

“The cumulative scientific evidence is unequivocal: Climate change is a threat to human well-being and planetary health. Any further delay in concerted anticipatory global action on adaptation and mitigation will miss a brief and rapidly closing window of opportunity to secure a liveable and sustainable future for all.” Climate Change 2022: Summary for Policymakers, IPCC

KARL SCHMEDDERS Professor of Finance

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ACTION POINTS

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Improve your company’s emission measures.

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Make a concrete plan for emissions reductions and offsets.

Change incentive schemes within your organization.

RECOMMENDED READING

THE REALITY OF CLIMATE FINANCIAL RISK By Karl Schmedders and Rick Van Der Ploeg (Project Syndicate, September 13, 2021)

WHAT IS YOUR SOLUTION? Executives and organizations should plan for more and higher carbon emissions costs. First, it is important to update and improve your estimates for your scope 1, 2, 3 emissions. Then, companies should develop an idea to reduce these emissions, while also recognizing any technical boundaries and evaluating offsetting options. Finally, leaders should change the incentive systems within their organizations to motivate employees to become more proactive across all of these issues.

CARBON TAXES NEED TO EXPLODE TO DEAL WITH THE ‘MOTHER OF ALL EXTERNALITIES’ By Karl Schmedders (I by IMD, March 28, 2022) HOW TO AVOID A CLIMATE DISASTER: THE SOLUTIONS WE HAVE AND THE BREAKTHROUGHS WE NEED By Bill Gates (Random House, August 23, 2022)

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Q&A →Sustainability HOW TO BOOST WHAT IS YOURHOT TOPIC? Climate tech start-ups and sustainable finance will play a crucial role in tackling climate WHY DOES IT MATTER NOW? Climate change is one of the hottest topics for governments,

change. Still, even after all the talk, only a fraction of the needed capital has been invested in this important area. The financial world needs to embrace more ways to incentivize new companies and technologies.

NGOs, and companies. At the moment, 49% of all the technologies that we will need to combat climate change are still not being discovered, with the new breed of climate tech start-ups facing unique financial challenges.

FINANCE FOR CLIMATE TECH START-UPS

Through more innovative sustainable financing, a more supportive environment can be created to encourage the development of the technologies required to tackle climate change.

SALVATORE CANTALE Professor of Finance

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ACTION POINTS

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INVEST TIME If investing your money is too much at this moment, at least invest some of your time to get familiar with the topic. This sector is fascinating! TRY SOME AVAILABLE SOLUTIONS! If your company does emit some greenhouse gases, why not consider using some of the solutions available from one of the many companies already in the field? For start-ups, commercial success is often a good by-product that could be leveraged to obtain capital. STAYONTHE LOOKOUT Many great investment opportunities are hidden in this sector. As Larry Fink, BlackRock CEO, once said: “The next 1,000 unicorns? They’ll be businesses developing green hydrogen, green agriculture, green steel and green cement.”

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RECOMMENDED READING

WHAT IS YOUR SOLUTION? In my view, there could be two alternative non- mutually exclusive solutions to facilitate the financing of these start-ups. 1. The sector is new and too fragmented. We need to develop a more comprehensive end- to-end approach to structure the ecosystem around start-ups. Want to get a glimpse of an interesting approach trying to address this issue? Look at the excellent work done by Third Derivative! 2. Given the risk involved with these start-ups, the set of investors willing to risk their funds is limited. We need to develop new ways to strip and slice the risk of a set of projects to offer a more comprehensive distribution of portfolio returns. This could attract more investors and capital.

THE NET-ZERO CHALLENGE: GLOBAL CLIMATE ACTION AT A CROSSROADS (PART 1) (WEF and Boston Consulting Group, December 11, 2019)

ENERGY TRANSITION INVESTMENT TRENDS 2022 (BloombergNEF, January 2022)

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Diversity equity& inclusion

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“IWAS SUPER INTERESTED BECAUSE OF THE VARIETYOR DIVERSITYOF ATTENDANCE.” KARINE LE HEIGET Global HR, TDK Electronics Corporation

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MANAGING TRICKY LEADERSHIP SITUATIONS

Diversity can boost performance, but only if the workplace feels inclusive for all. Executives can foster more inclusion by tackling micro-aggressions that undermine and alienate people who might not feel part of the ‘dominant tribe’.

In today’s global and increasingly uncertain

The ability to work across difference and create inclusive environments is more critical than ever. Research shows that companies can enhance performance through diversity as long as there is an inclusive environment for people to thrive in. Micro-aggressions – the small and seemingly invisible experience of jokes, comments, or slights that can hurt, humiliate, and disengage employees – can play a crucial role in making workplaces feel less inclusive and stifling the

power of diversity. At the same time, allies and advocates can play a supportive role in empowering diverse workforces.

environment, it is imperative to not only understand and embrace difference, but to create the space for “invisible” and “visible” diversity to thrive. By exploring and unpacking real-life examples of tricky diversity, equity, and inclusion scenarios, and by applying practical tools and techniques to support curious and courageous conversations that can bridge differences, executives can create psychological safety and bring out the best from the diverse individuals in their teams.

ALYSON MEISTER Professor of Leadership and Organizational Behavior

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ACTION POINTS

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To support those navigating micro- agressions at work, it’s important to constantly develop the five Cs of being an ally: consciousness, competence, curiosity, courage, and compassion.

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Leaders should actively develop the five Cs in their own approach.

The culture of the organization must also be underpinned by the five Cs.

RECOMMENDED READING

BIAS, INTERRUPTED – CREATING INCLUSION FOR REAL AND FOR GOOD By Joan C. Williams (Harvard Business Review Press, November 16, 2021) THE REAL-TIME IMPACT OF MICRO-AGGRESSIONS By Malissa Alinor (Harvard Business Review, May 17, 2022)

WHAT ARE MICRO-AGGRESSIONS? Micro-exclusions or micro-aggressions can include intentional and unintentional micro-assaults, micro-insults, and micro- invalidations that communicate hostile, derogatory, or negative attitudes. For example, talking over someone in a meeting or using patronizing language.

MIND THEMICRO-INEQUITY: FOSTERING INCLUSION INTEAMS

ANDORGANIZATIONS By Josefine van Zanten and Alyson Meister (I by IMD, February 2020)

HOWWOMENMANAGE THE GENDERNORMSOF LEADERSHIP ByWei Zheng, Ronit Kark and Alyson Meister (Harvard Business Review, November 28, 2018)

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DIVIDE OR INCLUDE? LEADING THROUGH LANGUAGE

Leaders have the ability to include or divide through language: Becoming aware of the pervasive nature of language and its impact enables leaders to be intentional about their language to create more inclusive cultures and communities in which people can thrive.

Diversity of thought, experience, and background is the spark that fuels new ideas and progress. We live in a world that is increasingly diverse, yet also increasingly polarized. In order to create inclusive societies that prosper and progress, it is important to use language sensitively and intentionally to bridge differences.

Yet, a 2020 report of 5,000 citizens in India, the US, Brazil, Germany and the UK shows that engaging in respectful dialogue with those who hold different perspectives, especially on topics of politics, race and sexual orientation, is rare and problematic. If people talk only with those who hold similar perspectives, they create echo chambers which justifies their own beliefs and does little to bridge differences.

A 2021 study from the UK, aptly named “The Diversity and Confusion Report”, showed that between 16% and 30% of people actively avoid talking about issues such as gender, religion, sexuality, race or disability for fear of saying the wrong thing.

HEATHER CAIRNS-LEE Adjunct Professor of Leadership

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97 % of people agree that language or words can influence or reinforce power dynamics in the workplace, while 87 % of people believe it is important for workplace discussions to focus on how language can evolve to be equitable or inclusive, according to the 2021 Language of Diversity report.

spokesman was removed from his job in 2017 for using the “N-word”, and Greg Clarke, Chairman of the English Football Association, resigned in 2020 for using “unacceptable” language while talking to members of parliament.

Words shape perceptions and actions. At the same time, many words have gendered, racist, or exclusionary associations and cause micro-aggressions. These are commonplace verbal slights that may communicate negative attitudes towards culturally marginalized groups. Consider how the gendered association of the phrase “Chairman of the Board”

favors men rather than women, or how hearing derogatory jokes about “people like you” affects a sense of belonging.

LANGUAGE AS AN ENABLER OF INCLUSION Global organizations influence society, and so it is useful that their leaders recognize language as a key enabler to creating respectful, inclusive cultures. At the same time, recognition of the importance of language to divide has resulted in serious consequences for the use of offensive language. For example, Netflix’s chief

LANGUAGE MATTERS A critical role of leaders is to frame experience, shape meaning, and engage people through their words and actions. It is, therefore, essential that they are attentive to how they lead through language and especially to the impact of their words. In short, words matter.

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ACTION POINTS

1 Language is used to determine who fits in – evident in the with, hire, and rely on people with similar experience and backgrounds. How does your language reveal your biases? 2 Inclusive language includes words and phrases that avoid biases, slang, and expressions that discriminate against groups of people based on race, gender, socioeconomic status, and ability. Developing guidelines for inclusive language serves two objectives: It educates people on the significance of language and it provides alternatives to exclusionary or derogatory words – this gives people language to speak up against bias. 3 Language evolves to convey and reflect changes in society. To be an effective ally, it is important to be curious and informed about shifting linguistic changes and ask when unsure of how to address a colleague or an issue. Guidelines are helpful, but no checklist will provide immunity to linguistic blunders. When those happen, as they inevitably will, be REAL: Recognize, Explore, Apologize, and Learn. 4 The quintessentially human tendency for language can be enhanced with AI tools that identify inclusive or exclusionary language. For example, Textio’s insights can reveal language patterns evident in performance feedback or employer branding. common mantra to hire for “cultural fit”. The language of cultural fit replicates the affinity bias – which is the tendency to connect

RECOMMENDED READING

THE LANGUAGE OF DIVERSITY (Institute for Public Relations, November 8, 2021)

When leaders are aware of the ways in which their language can include or divide, they can be intentional about how they communicate and role model language to create cultures of inclusion rather than division.

THE DIVERSITYANDCONFUSIONREPORT By Malissa Alinor (The Unmistakables, 2021)

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Leader- ship

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“LEADERSHIP TOME IS TO IMPROVE HOWTODEALWITH PEOPLE, HOWTO IMPROVE YOURCOMPANY IN TERMSOF STRATEGYANDREVENUE, HOW TO IMPROVE YOURSELF, AND HOWYOUCONTRIBUTEMORE TOYOURCOMPANYANDYOUR COUNTRY.” RAEDAL-RASHED Senior General Manager, National Water Company (Saudi Arabia)

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KEYNOTE

“DON’TBEABOTTLENECK TOCHANGE; CEOS MUST TRUST THE NEXT GENERATION”

Business leaders must “accept the new reality”, Holcim CEO Jan Jenisch says, arguing that organizations have no choice but to embrace megatrends such as digitalization, diversity, and sustainability to earn their place in the future.

Keynote highlights

Faced with fast-moving megatrends of the Fourth Industrial Revolution, Jenisch said, CEOs have a responsibility to create the conditions for innovators and the next generation to transform industries – and then to get out of their way. “We need to transform to have our place in the world tomorrow. We need to make it happen and to make it happen very fast,” he told Orchestrating Winning Performance participants during his keynote address.

“As CEOs of the company, we have to accept the reality of these needed changes,” he said. “There are too many CEOs trying to be in the driver’s seat. My job is to understand the importance of this, to understand that I should not be the bottleneck, and to delegate this to the next generation.”

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KEYNOTE

For Holcim, this means building more with less at the construction phase, for example, by reusing demolition materials and decarbonizing its products, making buildings more energy efficient when they are in use, and transitioning to a circular construction economy. There is also a need to lobby for new national building norms and standards to encourage greater uptake of sustainable solutions in the industry and to change consumer behaviors. At Holcim, Jenisch has the additional challenge of changing the culture of a traditional, 110-year-old company, for example, to attract and retain more diverse pools of talent. Currently, women make up 15% of Holcim’s global workforce and 30% of executive committee positions. “Diverse teams work so much better,” he said. Jenisch shared six reflections for business leaders faced with juggling similar challenges in Digitalization, diversity, and sustainability are reshaping our world, Jenisch said. CEOs and organizations that do not accept this, and do not act quickly enough to adapt, will not have a place in tomorrow’s world, he argued. DO NOT BE THE BOTTLENECK OF CHANGE It is not the job of the CEO to be in the driver’s seat for every innovation or to be the expert on all the latest trends. Instead, Jenisch emphasized the importance of enabling and empowering talent with the right know-how to lead the charge in the transformation of organizations. AGILITY AND SPEED OVER PERFECTION There is no point in waiting for the ideal solution for the complex challenges of an ever- changing world, especially when it comes to megatrends such as a digitalization, diversity, and sustainability. organizational transformation. ACCEPT THE NEWREALITY

“All these areas are not fully developed,” he said. “You cannot wait for the final outcome or the perfect plan. You had better keep on ‘doing’ today, and improve step by step, otherwise you are going to be too late.” PARTNERSHIPS ARE KEY Holcim has fostered more than 500 start-up partnerships in an open ecosystem to innovate new ideas for the sustainable future of building. “These trends are very complex, especially sustainability,” Jenisch said. “We need partners to decarbonize our operation. We need partners to develop the solutions – we cannot do this alone.” “Companies normally like to do everything by themselves and take a strong lead, keeping the knowhow inside,” he added. “For sustainability, you need more of an open network and to partner with people who know how to make it happen.”

“YOU CANNOT WAIT FOR THE FINAL OUTCOME OR THE PERFECT PLAN. YOU HAD BETTER KEEP ON ‘DOING’ TODAY, AND IMPROVE STEP BY STEP,

OTHERWISE YOU ARE GOING TO BE TOO LATE.”

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“THE CULTURE OF YOUR ORGANIZATION, THE PURPOSE OF YOUR COMPANY, THE WAY YOU DO TEAMWORK AND THE WAY YOU WORKWITHOUT HIERARCHIES – THAT IS REALLY KEY FOR THE FUTURE.”

“You can only make it happen if you have a modern company, with no hierarchies, where everyone can speak up – if they are 25 years old or 60 years old,” he said. FOCUS ON CULTURE AND TALENT With about 70,000 employees across 60 countries, maintaining a common purpose and culture is crucial for a company the size of Holcim – and others.

EMPOWER PEOPLE THROUGH FLAT ORGANIZATIONS The days of top-down,

traditional organizations are numbered because such structures stifle talent, diversity and innovation, he said.

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Q&A →Leadership CHANGE BEGINS WITH ME WHAT IS YOURHOT TOPIC? How and why should leaders engage in their own transformation. As Austrian neurologist and psychiatrist Viktor Frankl would say: “When we are no longer able to change a situation, we are challenged to change ourselves.” WHY DOES IT MATTER NOW? Human beings have always searched for meaning and purpose in their professional (and personal) lives. Our generation, and the next generations of leaders, live in an unprecedented time of excess uncertainty, anxiety, and confusion. Things are changing around us so

stop, reflect, and integrate these different selves. This requires a continuous and ongoing commitment to transformation. The concept of “the real me” is being replaced by the concept of “the evolving me”. This evolution will be a combination of growth, learning, outer change, and inner transformation. That transformation is a combination of looking forward (exploring, becoming lost, defining intentions), as well as looking back to discover what keeps us where we are (our routines, roles, expectations, beliefs, assumptions).

fast, that our own agency as leaders is reactive, and keeping up. More than ever before we are being split into different selves, so we need to learn how to

In today’s volatile environment, leaders should treat their own transformation journeys as an ongoing evolution.

BEN BRYANT Professor of Leadership and Organization

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ACTION POINTS

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Know where you have come from: What are the experiences, relationships, and roles that have made you who you are today? What themes start to emerge in your narrative of where you have come from? Challenge yourself: What do you want to leave behind, what do you want to move towards, and what do you want to hang on to? Find the edge. Talking about change is different to committing to change. This is what makes the edge so terrifying and exciting at the same time. What can inspire us to take the leap and engage with our own transformation?

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RECOMMENDED READING

STRANGERS TO OURSELVES: DISCOVERING THE ADAPTIVE UNCONSCIOUSNESS Timothy Wilson (Harvard University Press, 2004) THE BODY KEEPS THE SCORE: BRAIN, MIND, AND BODY IN THE HEALING OF TRAUMA Bessel van der Kolk (Penguin, 2015) THE EXPECTATIONEFFECT: HOW YOURMINDSETCANTRANSFORM YOUR LIFE David Robson (Canongate Books, 2022)

WHAT IS YOUR SOLUTION? The solution is not a set of behaviors, but rather a shift in the sense of being. Such solutions begin with a construction of leadership narratives and then learning to actively rewrite those narratives. What parts of ourselves are we trying to join together? What parts of ourselves do we need to leave behind? What parts of ourselves do we need to discover or resurface? What parts of ourselves do we need to hang on to?

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Q&A →Leadership LEADING IN THE NEWNORMAL WHAT IS YOURHOT TOPIC? How executives can lead through a world defined by uncertainty, industry changes, and macroeconomic challenges. WHYDOES IT MATTERNOW? The pressures facing leaders are greater than ever before, so much so that they are creating two fundamental leadership challenges. First, the old rules of leadership – traditional leadership models – just don’t work as well as they used to. And second, leaders

are increasingly having to operate using their instincts, which is fine except our instincts are not always right and acting on them can be a bit like gambling.

Traditional styles of leadership are becoming less effective. Focusing on the impact you have as a leader and on creating the right working environment can help your organization navigate the new normal.

SHLOMO BEN-HUR Professor of Leadership, Organization and Corporate Learning

NIK KINLEY Director, YSC Consulting

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ACTION POINTS

1

Focus on what you can.

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Focus on your impact.

Create behavioral loops that drive the responses you need.

RECOMMENDED READING

WHAT IS YOUR SOLUTION? We observe that traditional leadership models are being replaced by approaches that focus less on what leaders need to do and more on the actual impact they have, and how they can create a working environment that drives the behaviors and results that their business needs. By understanding where leaders’ instincts come from – and how the underlying code in our brains is formed – leaders can use this knowledge to better harness and improve their instincts.

LEADERSHIPOS Nik Kinley and Shlomo Ben-Hur (Palgrave Macmillan, 2019)

CHANGING EMPLOYEE BEHAVIOUR: A PRACTICAL GUIDE FOR MANAGERS Nik Kinley and Shlomo Ben-Hur (Palgrave Macmillan, 2015)

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→Leadership

COURAGE: PRACTICAL SOLUTIONS TO HARD PEOPLE PROBLEMS

For high-performance leaders, courage is the quality that enables everything else. But finding the courage to speak up, do the right thing, innovate, give feedback, ensure fairness, and foster inclusion is easier said than done.

Leadership takes courage: courage to address uncertainty, courage to foster inclusion, and courage to address people problems. Aristotle claimed that courage is the leadership quality that enables everything else. Contrary to popular belief, it is not reserved for extraordinary people. Whilst there may be no playbook for courage, it is a teachable and learnable skill, and most people have the capacity to be courageous. We have witnessed extraordinary courage in the past two years: courage and resilience to deal with the

emerging and unpredictable COVID-19 pandemic. Think of the scientists who invented new vaccines, the World Health Organization supporting the world’s sensemaking of vaccine protocols and supply, and the medical staff who have tirelessly dealt with patients. We have also witnessed courage in the aftermath of George Floyd’s death and the ensuing discussions about race, as well as the courage of leaders and people around the world in maintaining resilience and a sense of hope as they make respond to these extraordinary situations.

These events have required shifts in ways of interacting, working, learning, and living, and these shifts have provided an opportunity for people to practice courage in meeting these challenges.

HEATHER CAIRNS-LEE Adjunct Professor of Leadership

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ACTION POINTS

1

Interrupt the negativity bias to focus on positive outcomes that are possible by acting courageously provides a counter- argument to fear.

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Change your emotional state to provide the impetus for action. When people are anxious, the common advice is usually to calm down. However ,this may be difficult to achieve. Research , however, suggests that reframing anxiety as excitement – the positive emotion that embraces risks and enables action – is helpful for reframing challenges as opportunities rather than threats. Create a visible cue to remind people that courage is an invitation for growth and possibility.

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JOHNWEEKS Professor of Leadership and Organizational Behavior

While courage can embolden people to speak up or take action, we find that many people have an internal commitment to avoiding the possible risks of using courage. This competing commitment is motivated by the desire to stay safe, protected from risks of social alienation or psychological risks of embarrassment. When people understand the competing commitment to safety, the choice between staying in their familiar comfort zone or moving to their “stretch”

zone becomes explicit and actionable. This competing commitment to safety is influenced by negativity bias, which is the tendency to register and dwell on negative stimuli more readily than positive events. Put simply and to quote Baumeister, “bad is stronger than good”. Given this, what can leaders do to foster more courage? Just as people might exercise their muscles with regular workouts, we can think of courage as a muscle that can be developed by taking small steps of courage on a regular basis with the following practices.

ENCOURAGING EVERYDAY COURAGE Yet courage is also practiced in more ordinary, everyday situations: speaking up in a meeting, challenging the status quo, setting boundaries with a team, making a presentation despite a fear of public speaking, managing difficult stakeholders, or asking for a promotion or raise when you believe it is deserved. It is this everyday workplace courage that requires attention and practice in individuals and teams.

RECOMMENDED READING

THE COURAGE TOBE CANDID Jim Detert and Evan Bruno (MIT Sloan Management Review, summer 2021)

CULTIVATING EVERYDAY COURAGE Jim Detert (Harvard Business Review, November-December 2018)

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Q&A →Leadership HOW TO LEAD IN TIMES OF UNCERTAINTY WHAT IS YOURHOT TOPIC? How can executives successfully lead, engage, and support people during times of uncertainty? How can leaders strengthen their own resilience and resilience in others? How can we unpack the nature of uncertainty and identify the different challenges it poses for the “task” and “people” dimensions of leadership? WHYDOES IT MATTERNOW? In an era of polycrisis, uncertainty abounds. But common views of uncertainty often reduce it to a purely informational deficit that can be addressed with more or better data (or better analysis). As such, the more subjective impact of uncertainty is ignored or brushed off as part of these information management challenges. However, for leaders, the impact of

uncertainty on people is of central concern and must be actively attended to.

Leading in uncertain times has become one of the defining challenges for executives. It’s important to recognize that uncertainty does not just disrupt tasks, it also poses an identity threat to people and teams.

MARTIN FELLENZ Adjunct Professor of Leadership and Organizational Behavior

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ACTION POINTS

1

Recognize the range of impacts that uncertainty can have on tasks, processes, people, and organizations.

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Co-creating narratives with your followers is crucial to help make sense of and give meaning to your situation.

No one can just talk their way into the future. The more these narratives are collectively enacted, tested, revised, and replaced, the more you and your followers are shaping and creating your desired future.

RECOMMENDED READING

DON’T LET POWERCORRUPT YOU: HOWTO EXERCISE INFLUENCE WITHOUT LOSINGYOUR MORAL COMPASS Julie Battilana and Tiziana Casciaro (Harvard Business Review, September- October 2021) MANAGERS CAN’T DO IT ALL: IT’S TIME TO REINVENT THEIR ROLE FOR THE NEWWORLD OF WORK Diane Gherson and Lynda Gratton (Harvard Business Review, March- April 2022) HOW TO BE A GOOD BOSS IN A BAD ECONOMY Robert I. Sutton (Harvard Business Review, June 2009)

WHAT IS YOUR SOLUTION? Leaders who recognize that uncertainty is not just a disruptor of tasks, but also a source of identity threat to individuals and groups can respond more comprehensively and constructively to it. Separating the objective and subjective impacts of uncertainty can guide leaders to more effective management responses, as well as more impactful leadership approaches in volatile and troubling times.

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Q&A →Leadership THE POWER OF INFORMATION AND INCENTIVES WHAT IS YOURHOT TOPIC? Too many organizations are only insufficiently grasping a central idea of psychology and economics: Humans have agency: they choose what they do. WHYDOES IT MATTERNOW? Leaders report frequently that attracting and retaining talent is a serious challenge for their organizations. At the same time, many companies are far behind on their self-defined sustainability goals. We can understand both issues through the lens of economics.

By better understanding what motivates and drives their employees, organizations can develop better incentive schemes to boost performance and retain talent.

KARL SCHMEDDERS Professor of Finance

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ACTION POINTS

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Decide on goals for your employees.

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Determine which incentives will motivate employees to work towards these goals.

Set those incentives.

RECOMMENDED READING

WHAT IS YOUR SOLUTION? Executives must better understand the interests of their employees and what motivates them to come to work. Such an improved understanding will enable them to design better incentive schemes for their employees. This step will improve both their employees’ performance and their motivation to remain with the organization.

THE POWEROF INCENTIVES Jovana Poznan (Medium, 17 December, 2017)

THE PSYCHOLOGY OF HUMAN MISJUDGMENT Charles T. Munger

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COMMON SENSE OR COMMON PRACTICE?

To borrow a much-used metaphor from the last two years, responding to uncertainty has arguably become the “new normal”. How can leaders respond to the rapid changes and crises of the “new normal”?

In recent years, society has experienced a veritable “tsunami” of challenges and rapid changes. The COVID-19 pandemic infected every country with deadly consequences and fundamentally transformed the way people live and work. The US presidential transfer of power from Donald Trump to Joe Biden was beleaguered with controversy and a stampede on Capitol Hill that questioned the very nature of democracy.

Just as the world anticipated a steadier state in early 2022, COVID-19 transmuted into monkeypox, Russia sent shockwaves through the world by sending troops into the Ukraine, and stock markets plummeted to their lowest levels in years. These geopolitical events have challenged the very notions of safety and predictability in society, saturating leadership with unprecedented challenges and complexity.

HEATHER CAIRNS-LEE Adjunct Professor of Leadership

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ACTION POINTS

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Consider how bias and noise – unwanted variables – may be affecting the way decisions are framed. This impacts what is noticed and, importantly, what is overlooked. It is often the overlooked noise that leads to unintended and unwanted consequences. Use smart conversations to optimize the interests of all by empowering people to speak up and challenge assumptions, the status quo, and perceptions of risk. This may involve making some short- term trade-offs in the service of long- term gains. Create a culture that actively seeks to learn frommistakes and challenging situations. It is the ability to learn that enables people and organizations to adapt with agility. Clear, consistent communication that includes all stakeholders, shares the available information, and conveys hope is key for managing volatile and unpredictable events.

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SAMEH ABADIR Professor of Leadership and Negotiation

Yet being able to do this and stay calm in the midst of threat requires the willingness to be inclusive to ensure all information is available and considered to make optimal decisions. Leaders who manage this, such as Naohiro Masuda, the superintendent of the Fukushima Daini nuclear plant in Japan, balance calm confidence and a realistic appraisal of the situation to provide a cool analysis of the emerging situation with humility and empathy to offer hope and motivation. When leaders combine the agility, adaptability, and cohesion of a small team with the power and resources of a large organization through what we call “smart conversations”, they can create extraordinary results by building on the wisdom of the crowd.

making. This framing and noise can result in breakdowns in communication, sometimes with tragic consequences and resulting in sub- optimal solutions. Awareness of the subtle, but pervasive, ways that framing, bias, and noise affect decisions is crucial for leaders. This awareness helps them to develop decision and conversational hygiene to reduce unwanted unpredictability in rapidly changing times or during crisis. We know from research on crisis or accidents that it is vital for leaders to engage in collective sensemaking to develop an emerging picture of the unknown that can be tested. This enables the collective to learn from and adapt to the evolving situation.

LEADERSHIPAS SENSEMAKING Nevertheless, the task of leadership is to make sense of rapidly changing events, set a direction amidst uncertainty, and provide a sense of hope and safety to organizations. Certainly, to lead in this volatile, uncertain, complex, and ambiguous (VUCA) world requires skills of sensemaking, navigation, communication, and complex stakeholder management. It also requires common sense. However, common sense is often not common practice due to the ways that people frame decisions, and the common biases and “noise” – unpredictable unwanted variability – that affect decision-

RECOMMENDED READING

THE TWOROLES LEADERSMUST PLAY INACRISIS Sameh Abadir (MIT Sloan Management Review, 22 September, 2020) TOOLKIT FOR STRATEGIC LEADING THROUGH A CRISIS Sameh Abadir and Niccolò Pisani (I by IMD, 4 April, 2022)

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