The coronavirus pandemic was the ultimate leadership test for company executives. The crisis has underscored the need for leaders who can deal with uncertainty and have the ability to discovery opportunities for recovery and growth.
Many business schools have established executive education programs that help leaders handle a crisis. Leadership at all times requires calm and foresight, but crisis situations confront leaders with challenges that go well beyond the normal scope of their business.
“They do not necessarily require new or different skills but leaders need to be aware of the challenges they are faced with: decisions have to be made under uncertainty, ambiguity, time pressure and complexity,” says Jan Hagen, professor of management practice at ESMT Berlin.
High reliability organizations have developed frameworks that address these challenges and allow their leaders and teams to maintain control in these situations. Key elements are structured and iterative decision making processes, open communication, maintaining situational awareness and good workload management.
Like every major crisis, the COVID pandemic initially sparked great interest in crisis leadership training from companies. ESMT Berlin offered a new series of online sessions to help leaders navigate through times of crisis and beyond. For example, the Leading Through the Crisis Certificate is a distance learning program for top executives.
Additionally, ESMT Berlin offers the open enrolment program Leadership Under Pressure. The main takeaways are how to stay relevant to the emerging situation, create space for discussions on pressing issues, how to encourage engagement, enhance knowledge and foster team spirit.
“Going forward we anticipate that the interest in crisis leadership will wane — until the next crisis hits,” says Hagen.
He stresses that the lessons learnt will be valuable long beyond the pandemic. “Good crisis management will not only allow a company to survive a critical situation but also provide it with learning opportunities on all levels for thriving afterwards,” says Hagen. “If no learning takes place, the likelihood for future problems increases.”
Every business will have to deal with crises
Nandu Nandkishore, professor of marketing strategy at the Indian School of Business, agrees. “Every business will encounter and have to learn to deal with crises, repeatedly,” he says. “The root cause may be a product quality or compliance issue, or a change in the regulatory or competitive environment, or a ‘black swan’ event like COVID. Irrespective of the cause, learning to handle crises is a key skill.”
With this in mind, ISB has started offering the “Leadership in the Era of Crisis” course. This program helps participants to lead themselves and virtual teams more effectively, create a workplace that enables peak performance, and to make complex decisions against the backdrop of uncertainty.
Ultimately, participants will be aiming to ensure that their organization comes out of the crisis in a stronger position. “A badly managed crisis can mean the end of a promising career,” says Nandkishore. “On the other hand, the ability to manage crises successfully is a key qualification to be a successful CEO.”
Crisis leadership skills make great managers
Allison Wheeler-Héau, director of open programs at the UK’s Cambridge Judge Business School, agrees that crisis leadership skills are widely recognized as an important managerial attribute, so executives and other leaders who improve their ability to manage through adverse situations are well-placed to advance up the career ladder faster.
“Sound crisis leadership can be a competitive advantage for an organization, and we have seen during the pandemic that some companies made great strides in spite of the upheaval,” she says. “By the same token, poor crisis leadership can cause organizations to flounder as better-led rivals move ahead.”
The key takeaways of the Transformational Leadership in Turbulent Times program at Cambridge include motivating employees, adapting one’s own leadership style to meet employees’ needs, and improving managerial decision-making.
Another option is the “Crisis Leadership and Human Behavior” program at London Business School. Participants will learn about the main ways in which people’s behavior can show bias in a crisis, and how this can be mitigated and leveraged to improve outcomes.
“The executives will be given a framework focused on human decision-making, communication and learning, before, during and after crises,” says David Faro, associate professor of marketing at LBS.
“The relevance of crisis leadership may indeed lose its appeal as we enter the recovery mode of the pandemic – and this would come at a cost,” he says. “Good leaders need to prepare their organizations and society for future crises, if they are to be in a strong position to respond when the unexpected happens. You don’t want to be playing catch-up in an emergency.”