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Introduction : Leadership for Dealing with Complex Changes

Kangas, Anni,Kujala, Johanna,Lönnqvist, Antti,Heikkinen, Anna,Laihonen, Harri

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7 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes CHAPTER 1 In oduc ion: Leade ship o Dealing wi h Complex Changes ANNI KANGAS, JOHANNA KUJALA, ANTTI LÖNNQVIST, ANNA HEIKKINEN & HARRI LAIHONEN T he wo ld is changing apidly. Many con empo a y change p ocesses a e inc easingly complex. The e ec s o clima e change, u banisa ion, ageing socie ies, he dynamics o global secu i y, o c ea ion o sus ainable condi ions o business de elopmen a e all phenomena ha canno be made o i any simple model. They ha e a numbe o bounda y-spanning componen s and a e dynamic and open o hei en i onmen s. This means ha leade s mus possess new kinds o knowledge and skills o unde s and and deal wi h such complex phenomena. To espond o he needs o a ious kinds o leade s ope a ing in hese complex en i onmen s, his book de elops a amewo k o leading change. This app oach is he e called he Leade ship o Change (LFC) amewo k and i builds on he ollowing h ee ideas: 1. Many con empo a y change p ocesses a e complex and sys emic. J This highligh s he capaci y o hink ac oss adi ional ins i u ional bounda ies and he abili y o see pa e ns and s uc u es beyond speci ic elemen s and e en s. 2. Issues and p oblems c ossing adi ional ins i u ional bounda ies canno be esol ed by a single ac o o sec o . Go e nmen s, businesses, ci il socie y ac o s, ci izens and consume s mus wo k oge he , nego ia e, and ag ee on no el ways o doing hings. J This s esses he need o unde s and how di e en socie al sec o s and ac o s unc ion and make sense o he wo ld, and how hey can wo k oge he . 3. Complex en i onmen s a e ma ked by ambigui y and unce ain y. J This emphasises he capaci y o emb ace unce ain y and use a ious sou ces o in o ma ion and knowledge o c ea e a sha ed unde s anding o he si ua ion a hand. 8 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes Wi h he g owing complexi y and ambigui y o leade ship con ex s, leade ship unc ions ha e become dispe sed. Leading change in a complex wo ld is o en a collec i e e o aking place bo h wi h and wi hou o mal leade s. This book is aimed a leade s as well as analys s o leade ship examining con empo a y change p ocesses om a ious posi ions. The book is no con ined o wha is known as leade ship s udies. I ins ead examines leade ship om a ansdisciplina y pe spec i e. T ansdisciplina i y means aking a holis ic app oach o leade ship; i no only uses knowledge om di e en disciplines bu displaces disciplina y hinking in i s examina ion o leade ship and change (e.g., Aal o, 2012, 16–19). The ansdisciplina y app oach is de eloped he e by examining and analysing a ious phenomena c ossing he adi ional ields o business and managemen , public adminis a ion, and poli ics. Ins ead o aking disciplina y discussions as he poin o depa u e, he chap e s p esen ed in his book a e uni ed by a se o concep s which p o ide a amewo k o enac ing and analysing leade ship: complex wo ld, ela ional leade ship, and dynamic change (see Figu e 1). Complex wo ld e e s o he idea ha he issues and sys ems comp ising socie y can be placed along a con inuum om simple o complex. Rela ional leade ship poin s o he idea ha leade ship canno be con ined o simple leade - ollowe ela ionships. I is no es ic ed o a single o mal leade o small g oup o leade s. Rela ionali y also app ecia es he wide social and en i onmen al con ex in which leade ship is enac ed. In con as o planned change, which is linea , o ganised, and e icien , dynamic change app ecia es he non-linea , ans-scala , and less p edic able ea u es o change. The LFC amewo k is i s and o emos an analy ical p ism. As illus a ed by Figu e 1, opics and issues can be placed di e en ly along he con inuum anging om simple o complica ed and u he o complex socie al p oblems. Al hough he wo ld appea s inc easingly complex, some o ganisa ional and leade ship issues emain ela i ely s aigh - o wa d and ou ine. The same applies o leade ship and i s ela ionali ies. Despi e he ob ious endency owa d plu al, lexible and e en leade less o ganising, many leade ship se ings a e hie a chical and leade -cen ic. As A ja Ropo eminds in he a e wo d chap e o his book (Ropo, Chap e 18), in imes o chao ic change, he oic and cha isma ic leade ship is o en sough o . The chap e s o 9 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes he book examine no only ela ional, bu also mo e leade -cen ic o en i y- based, leade ship se ings. Fo example, leade ship exe cised by he heads o s a es o companies’ boa ds o di ec o s is close o he leade -cen ic end o he spec um while s akeholde coope a ion o cus ome alue c ea ion display ela ional ea u es o leade ship. The con ibu ions o he book also di e in hei unde s anding o change. The p ac ices o consume ci izens in educing ood was e, socie al ansi ions owa ds he ci cula economy, and he eme gence o new powe blocs in he in e na ional sys em a e all change p ocesses. Howe e , hey a e unde pinned by a di e en concep ualisa ion o change. Some change p ocesses can be planned, a leas o an ex en . In FIGURE 1. The Leade ship o Change amewo k o analysing leade ship in a complex wo ld ENTITY LEADERSHIP EMERGENT CHANGE COMPLEX PROBLEMS RELATIONAL LEADERSHIP PLANNED CHANGE SIMPLE PROBLEMS 10 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes o he cases, change is mo e eme gen . Read oge he , book conc e ises he LFC amewo k o unde s anding he leading o change in a complex wo ld. I hus in i es leade s and analys s o change and leade ship o conside how he speci ic p ocess o change hey a e dealing wi h si ua es along he h ee dimensions o simple s complex p oblems, en i y-based s ela ional leade ship, and planned s eme gen change. The ollowing sec ions explica e wha hese dimensions en ail. Complex Wo ld Complexi y e e s o sys emic, in e connec ed, and unp edic able asks and ope a ing en i onmen s (Nason, 2017). “Complex” is di e en om “complica ed”, as he la e in ol es many icky, echnical challenges. Fo example, building a compu e o an ae oplane is a highly complica ed ask equi ing much echnical skill, he igh componen s, machine y, ins uc ions, e c. Howe e , despi e hese di icul ies, i is possible o epea he p ocess exac ly he same way housands o imes in a ious loca ions. As He be Simon no es, e en going o he moon was complex only in he sense ha i challenged ou echnical capabili ies: “I was achie ed in an exceedingly coope a i e en i onmen , employing a single new o ganiza ion, NASA, ha was cha ged wi h a single, highly ope a ional goal. Wi h eno mous esou ces” (Simon, 1996, p. 139). In con as o “complica ed”, “complex” e e s o he in e connec edness and in e dependence o a ious ac o s. When a ac o y p oducing clo hes o global ma ke s collapses in Bangladesh killing hund eds o wo ke s, his may seem like an acciden . Howe e , i we make sense o he e en h ough he idea o complexi y, we a e p omp ed o see i in a mo e mul idimensional way: we can see ha people wo k in hese condi ions because o a sho age o o he jobs. This links he disas e o local employmen dynamics and he egula o y amewo k ha enabled a ac o y o ope a e in an unsa e building. We can u he connec he disas e o he dynamics o global ade in which he Bangladeshi ga men indus y can only su i e by o e ing he lowes o e heads. We can also see he link o consump ion p ac ices and habi s o consume s in Wes e n ma ke s. Ne e heless, i is no possible o 11 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes iden i y a linea pa h o cause and e ec om one e en o ano he . Ins ead, he ela ionships a e complex, mul idimensional, and in e ela ed. The e a e a ious ways o e e o complex and in e ac ing socie al challenges. They may be called “messes” (Acko , 1999), “g and challenges” (Fe a o, E zion & Gehman, 2017), o “commons p oblems” (Os om, 1990). A well-known concep used o desc ibe pa icula ly complex and icky leade ship and managemen con ex s is he concep o he “wicked p oblem” (Ri el & Webbe , 1973; Webe & Khademian, 2008). Wicked p oblems a e simul aneously uns uc u ed, c oss-cu ing, and elen less. Fo example, he ageing wo k o ce, which Hanna Salminen analyses in he chap e in his book can be conside ed a wicked p oblem (Salminen, Chap e 5). I is elen less because i is unlikely o e e be sol ed pe manen ly. The p oblem is uns uc u ed in he sense ha he ageing wo k o ce is connec ed o many o he ac o s, such as he business en i onmen , egula ion, he skill le el o he wo k o ce, global economic cycles, e c. These all ha e an impac on employmen policies and human esou ce managemen p ac ices. The ageing o wo k o ce is also c oss-cu ing, as i ela es o many s akeholde s wi h di e ing pe spec i es and po en ially con lic ing iews. Ano he good example o ambiguous and unp edic able social de elopmen s a e changes caused by digi alisa ion, which se e al chap e s in his book discuss. Digi alisa ion is a “mega end” which cu en ly a ec s – and will con inue o a ec – many sec o s o socie y. No pa o socie y is le una ec ed by digi alisa ion, as Ma i Nieminen a gues in his book. Nieminen analyses he ways in which digi alisa ion and he associa ed ans o ma ions o he global economy ha e ende ed he exis ing p inciples o in e na ional ax sys em ou da ed (Nieminen, Chap e 6). This olume also shows ha some business sec o s and indus ies, such as banking and insu ance sc u inised by Raimo Vou ilainen and Lasse Koskinen (Chap e 17), a e acing majo changes due o digi alisa ion. The in e ace be ween company and cus ome is mo ing o he In e ne , and he de elopmen o digi al echnologies enables many key asks o be ca ied ou au oma ically. This The e a e a ious ways o e e o complex and in e ac ing socie al challenges. 12 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes is likely o make many cu en employees edundan – while new jobs also eme ge. Vou ilainen and Koskinen sugges ha one o he conc e e implica ions o his o leade ship and managemen is ha businesses should in es in de eloping hei employe s’ abili ies o deal wi h change. In complex en i onmen s, each ac o is linked o many o he ac o s, which c ea es su p ising ou comes. Many con ex ual and ex a-con ex ual ac o s play a ole in change p ocesses, and unp edic able e en s may occu . Ambigui y and unce ain y a e hus an inhe en pa o he leade ship dynamics in complex se ings. Mo eo e , e en hough we can imagine he di ec ions in which socie ies, echnologies and ela ed oppo uni ies a e e ol ing, he u u e is unce ain and ull o su p ises: i is no clea wha will happen and when. The e o e, i is no easy o a gi en ac o o o esee he op imal cou se o ac ion. Changes need o be made, bu he e is unce ain y ega ding he ype, di ec ion, and iming o he ac ions o be unde aken. Tapio Jun unen and Si pa Vi a (Chap e 4) discuss his unce ain y in he con ex o secu i y go e nance. They show ha esilience poli ics has eme ged as a esponse o he pe cei ed inabili y o socie ies and go e nmen s o gua an ee secu i y h ough adi ional p e en i e and p oac i e secu i y policies in condi ions o complexi y. Mo eo e , Jun unen and Vi a a gue he ise o esilience hinking indica es a c isis o ans o ma ion o leade ship. One way o manage unce ain y is o build isions and s a egies on he bes a ailable in o ma ion, whe he ha comes om in e nal o ex e nal sou ces. Leade s also need o p o ide assu ances ha he equi ed knowledge, asse s, and capabili ies a e a ailable o enac he change. The chap e by Pasi-Heikki Rannis o and Anna Salo an a expands on his poin . Rannis o and Salo an a a gue ha while leading change e ec i ely equi es e alua ion, ew o ganisa ions ac ually e alua e hei change p ojec s. The au ho s also poin ou some ways in which e alua ion can be embedded in o ganisa ional change p ocesses (Rannis o & Salo an a, Chap e 10). This book also d aws inspi a ion om he wo k o schola s who ha e in oduced amewo ks ha enable us o make sense o e en s and changes aking place in complex en i onmen s. One such example is he VUCA amewo k, which is used o desc ibe complex and challenging leade ship con ex s (Benne & Lemoine, 2014; Elking on, an de S eege, 13 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes Glick-Smi h & Moss B een, 2017; Mack, Kha e, K äme & Bu ga z, 2016). VUCA s ands o ola ili y, unce ain y, complexi y and ambigui y: Vola ili y – The e is a likelihood o sudden and unexpec ed changes� Fo example, he e may be apid changes in he cos o esou ces due o unp edic able e en s� Unce ain y – Some hing impo an may (o may no ) happen – o example, due o some key s akeholde s’ decisions – bu hese e en s a e ha d o p edic � Complexi y – The p ocess includes many in e connec ed ac o s and a iables, so i is di icul o o esee he ou come o e en s� Ambigui y – When dealing wi h new si ua ions – o example, when en e ing an en i ely new ma ke – i may be di icul o unde s and he logic o how hings wo k� The ou VUCA cha ac e is ics a e nowadays qui e commonly u ilised in he wo k o leade s and manage s, as he e a e many unce ain ies and he wo ld seems o change quickly. A VUCA ype o en i onmen can be conside ed an ex eme con ex o leade ship and managemen . I is complex, as changing, and unp edic able. In such an en i onmen , i is e y di icul o know wha is likely o happen and wha would be he igh s ep o ake. The chap e by Mika Y jölä, Hannu Kuusela, Elina Nä änen, Timo Rin amäki and Hannu Saa ijä i (Chap e 8) expounds on his poin . The au ho s sugges ha in he VUCA en i onmen , leade s and manage s need simpli ying heu is ics o e e o in complex decision-making si ua ions. This a gumen is conc e ised wi h he help o he cus ome alue amewo k. This can be used o ensu e ha in he mids o changes, he o ganisa ion emains ele an o cus ome s – one o i s main s akeholde s. Rela ional Leade ship One o he key a gumen s o his book is ha in a complex wo ld, educ ionis app oaches o leade ship a e no su icien . In con ex s whe e mul iple ac o s a e in ol ed, no single ac o holds all he powe , capabili y, 14 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes o compe ence o make decisions on behal o o he s. Ins ead o op-down, hie a chical managemen p ocesses, he LFC amewo k highligh s he leade ship oles o a a ie y o ac o s. Many chap e s in his book examine how ac o s such as on line employees, cus ome s, o o he s akeholde s enac leade ship. I u he examines how c oss-sec o collabo a ion can c ea e a g ea e collec i e capaci y o add ess wicked p oblems and complex issues such as global sus ainabili y challenges. In hei chap e , Anna Heikkinen, Je e Nieminen, Johanna Kujala, Hannele Mäkelä, A i Jokinen and Ou i Leh onen (Chap e 2) de elop his poin in he con ex o s akeholde engagemen . Examining u ban ecosys em se ices – pa ks, ec ea ional o es s, u ban ga dens – he au ho s cha ac e ise s akeholde engagemen as an open and pa icipa o y dialogue be ween a ious human – and also non-human –s akeholde s. Complex se ings can be cha ac e ised by di e se and po en ially con lic ing in e es s, objec i es, and pe spec i es. This has implica ions o leade ship. When mul iple s akeholde s a e in ol ed, i is likely ha con lic s o in e es a ise. As a consequence, nego ia ions, co-ope a ion, and collabo a ion a e needed. The chap e by Paula Rossi de elops his poin u he . Rossi sugges s iewing leading change as a e lexi e p ac ice whe e con lic s and clashing pe spec i es a e explo ed and app ecia ed (Rossi, Chap e 9). The LFC amewo k highligh s he need o conside leade ship in a ela ional way. This enables co-ope a ion ac oss sec o s and he pooling o he s eng hs o di e en ly posi ioned indi iduals and o ganisa ions in sol ing global challenges. I also challenges he s a us o human beings as cen al playe s in change p ocesses, as he chap e by Heikkinen e al. (Chap e 2) shows. Howe e , leade ship is usually de ined as he human capaci y o in luence o he s, o as he abili y o guide o di ec o he s. O en, leade ship is seen as a pe sonal skill o ai possessed by an indi idual, o as he capabili y o compe ence o a eam o o ganisa ion. Resea ch o en dis inguishes be ween leade ship s udies a he indi idual (mic o), o ganisa ional (meso), and socie al (me a) le els. A he indi idual le el, leade ship li e a u e examines leade ship om a ious iewpoin s, such as leade ship oles (e.g., isiona y, con ibu o , ac ician, acili a o ) o ac o s (e.g., s a egic, communica i e, pe sonal, mo i a ional). A he meso le el, esea ch o en ocuses on o ganisa ional pe o mance and 15 Leading Change in a Complex Wo ld: T ansdisciplina y Pe spec i es In oduc ion: Leade ship o Dealing wi h Complex Changes seeks o de e mine how indi idual a ibu es, such as communica ion skills, a e u ned in o o ganisa ional compe ences and ou comes. In addi ion o o ganisa ional esul s, i is also impo an o unde s and he p ocesses leading o hem. I is possible in many o ganisa ions o dis inguish bo h op-down and bo om-up leade ship p ocesses. In he o me , op managemen – such as a company’s boa d o di ec o s (see Ruohonen, Chap e 13) – ou lines he ision and de ines he s a egies o he o ganisa ion o ollow. In he la e , s a egies a e mo e eme gen and allow membe s o he o ganisa ion and socie al s akeholde s o pa icipa e in de ining wha is seen as impo an and aluable (see Kujala, Leh imäki & F eeman, Chap e 7; Y jölä e al., Chap e 8). A he socie al o me a le el, he mos c i ical leade ship challenge ela es o global sus ainabili y. The Uni ed Na ions ha e se 17 sus ainable de elopmen goals (SDGs) ha all socie ies and o ganisa ions ac oss he plane should ake se iously o ensu e he p esen gene a ion lea es he Ea h in a li eable s a e o u u e gene a ions: (1) no po e y, (2) ze o hunge , (3) good heal h and well-being, (4) quali y educa ion, (5) gende equali y, (6) clean wa e and sani a ion, (7) a o dable and clean ene gy, (8) decen wo k and economic g ow h, (9) indus y, inno a ion and in as uc u e, (10) educed inequali y, (11) sus ainable ci ies and communi ies, (12) esponsible consump ion and p oduc ion, (13) clima e ac ion, (14) li e below wa e , (15) li e on land, (16) peace, jus ice and s ong ins i u ions, and (17) pa ne ships o he goals (Uni ed Na ions, 2015). Mee ing he global challenges posed by he SDGs means ha leade s o a ious o ganisa ions mus hink beyond he simplis ic economic alue so en enched in ou cu en hinking. 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