How to swim in the new waters of leadership

David Foster Wallace’s legendary commencement speech to the 2005 graduating class of Kenyon College opened with this story:

“There are these two young fish swimming along and they happen to meet an older fish swimming the other way, who nods at them and says, ‘Morning, boys. How’s the water?’ And the two young fish swim on for a bit, and then eventually one of them looks over at the other and goes ‘What the hell is water?”

One of the most important lessons in Wallace’s remarks follows soon after the metaphor ends: “The most obvious, important realities are often the ones that are hardest to see and talk about.”

So, let’s talk about the obvious and important realities. Leadership, at least the way it is traditionally practiced, is not working. The water has changed.

I ask you to hang in here with me. This is too important for a three-point list in an 800-world article. Understanding the shifts required to lead in the future is crucial for swimming in the new waters of leadership.

What has and has not changed?

The good news is that the role and purpose of leadership has not changed. Effective leadership continues—and will continue—to be defined by the ability to influence the actions and outcomes of others to deliver positive results.

The bad news is that thirty-nine percent of CEOs believe that their organization’s business model will not survive the next 10 years unless something changes according to the PwC 2023 CEO survey. Only 12% of CEOs have confidence in the leaders on their bench. Leaders increasingly doubt the ability of their executive teams to work together, lead change, and be a role model for the right culture. The confidence of the next generation leaders in their executive teams continues to fall and threatens retention.

To be sure, we have experienced similar changes and challenges to those we are facing today before. Generational shifts are nothing new. The same can be said for technological innovation, geopolitical upheaval, economic downturns, worker shortages, inflation, societal values shifts, and even culture wars.

We haven’t, however, experienced the scale and scope of so many changes occurring at once in at least 50 years … if ever.

Leaders must prepare and engage their teams to flourish in a world where anything and everything can change all at once without a moment’s notice. It is the equivalent of totally rebuilding your car while driving and simultaneously fearing that your competitors are flying supersonic jets.

Leadership: From what to what?

Leaders must make the following six shifts to bring their team and credit union with them into the future.

  1. From leadership as an earned position to leadership as a calling fulfilled through continuous growth.

Those who choose a life of religious service and social activism often speak of being “called.” It is a sense of duty that exists regardless of individual vocation.

Organizations, on the other hand, typically frame the ascension to leadership in terms of a promotion or advancement. Selection, at least initially, is often based on performance in a non-leadership role. The best member service representative gets the job as the member service supervisor. Promotions into broader leadership roles are often based on assumed success in an expanded role based on success in a more limited role.

There is nothing wrong with this as long as two things are present:

  • Everyone realizes that every new leadership opportunity is a new job rather than an extension of the old one.
  • The motivation to lead is for the right reasons. A desire to serve, help people grow, improve the environment, or act as a role model are good reasons. Wanting more money, authority, or to have your way.
  1. From seeing results and relationships separately to embracing results and relationships as connected and intertwined.

Think of a leader, teacher, mentor, or coach who meant a great deal to you. Did that person expect more of you or less of you? When she or he expected more, were you more likely or less likely to give every ounce of effort to meet or exceed those expectations? Was their influence based on their position or on the relationship?

Even if their influence began based on their position, well over 95% of the responses to those three questions acknowledged the power of relationships to produce results. Compliance with expectations can be mandated. Commitment to exceed expectations is volunteered. Volunteered commitment is inspired by strong relationships.

  1. From training people for today to developing them for the future.

Gartner found that the total number of skills needed to do a job have been increasing 10% per year since 2017. The World Economic Forum has stated that 44% of workers’ skills will be disrupted by 2028.

Yes, we still need people to perform the jobs of today. AI, robotics, and machine learning are advancing at a rate that we must also develop people for organizations and work as they will be. It is imperative for your credit union’s ability to remain relevant in the marketplace. It is also essential for attracting and retaining the talent you need to flourish.

  1. From change as an event to which we must adapt to change as a habit to be pursued.

Social psychologist Kurt Lewin’s three-step change model laid the foundation for change management thinking since its publication in 1947. It was based on the idea that you unfreeze the undesired behavior, change it, and refreeze the new behavior.

That was sufficient in a world where change is slower and more predictable. Today, the pace of change leaves little time to refreeze a new behavior or process. We are often left with something that resembles JELL-O nailed to the wall.

The alternative is for leaders to develop change as a habit to be developed and pursued. The environment demands that we continually be better, faster, cheaper, and friendlier in pursuit of remaining relevant. If we want things to be better, they must be different. If we want things to be perpetually different, change must become a habit.

  1. From transformation as a mechanical process toward nurturing healthy metamorphosis as an organic destiny.

Business transformation, at least the way it is sold by most consulting firms, is a largely reactive and mechanical process powered by specific processes and activities. Its goals are to use digital tools more effectively, develop the capacity to scale the operation, meet the challenges of disruptive competitors, and/or capture operational efficiencies.

The problem is that business transformation rarely achieves its desired goals or creates sustainable solutions. Research published by McKinsey & Associates puts the number of successes at fewer than one-third.

Let’s compare that to the fate of caterpillars.

About 2 percent of butterfly eggs live to become adult butterflies. The other 98% succumb to predators, disease, herbicides, weather, parasitoids, insecticides, and other natural causes of death.

Comparatively speaking, the one-third success rate of business transformations looks excellent. Except for this: Every caterpillar that survives metamorphosis becomes either a butterfly or a moth. There is no other option. Caterpillars do not become Lady Bugs, and the only thing that gets in their way are factors beyond their control.

This doesn’t mean that raising butterflies—or leading organizations—in a controlled environment is the answer. Current research suggests that monarch butterflies raised in captivity are weaker than those that must survive the wild. Likewise, competition makes your credit union stronger. Transforming how we operate is not going away.

The point is that nurturing a healthy metamorphosis creates organizations that are constantly learning and growing. A culture that proactively learns and grows is better equipped to adapt and flourish in the face of unpredictability and complexity.

  1. Leadership as distinct levels and steps to leadership as integrated dimensions.

We teach leadership as distinct levels and numerical steps. It is a linear approach that serves us well in predictable, orderly environments. On the surface, this works.

Look closer and we see intense unpredictability, unending uncertainty, extreme complexity, and relentless change. The paradigm for leadership going forward is the String Theory of physics not linear equations of standard math.

Leaders must deliver results for the credit union, amazing experiences for members, and a compelling culture that engages the team while simultaneously preparing for the future. They must influence up, down, and sideways across the credit union. Most important, they must do all these things even when they are not physically present.

To accomplish all of these requires mastering and then seamlessly moving between the dimensions of personal, interpersonal, organizational, developmental, change, and transformational leadership.

Predictions about the future of credit unions typically focus on things—technology, hyper-personalized services, member experience, and the list goes on. These will all be important, and they will all require leadership. The “things” don’t change unless leaders change.

The days of sustaining the status quo are gone. True leaders relish this challenge. They distinguish themselves by their ability to swim in the new waters of leadership.

Randy Pennington

Randy Pennington

Randy Pennington is an award-winning author, speaker, and leading authority on helping organizations achieve positive results in a world of accelerating change. He is author of the award-winning books Make ... Web: Details