I have previously shared marketing trends in the post-epidemic era. In this article, I take reference from the recent report on “New leadership for a new era of thriving organizations” published by McKinsey & Company to discuss the transformation of leaders in the new era. What is the role of a leader in an era when turmoil and chaos are the norm?

We are in an era full of unknown challenges and opportunities. The climate crisis, the post-pandemic world and changing social values continue to disrupt individuals and businesses. Globalization and geopolitics are changing world power relations, while technological advances are constantly changing the way we live and work. Different from the standard business model in the past, the enterprise has changed from the era of individual leaders to the era of networked leadership teams, focusing on the collaborative network of self-management teams, focusing on creating value, and embracing a more open culture for sustainable growth. Therefore, leaders in the new era must reposition, change their way of thinking, rethink the way of interaction and cooperation in the leadership team, and even reconceive the business model of enterprises and industries.

To embrace the new era, the following are five areas in which new leaders need to rethink and make changes.

1) Beyond profit

In the past, companies aimed at profit, which was of course necessary, but today companies must go beyond profit to create value and impact for all stakeholders, including contributing to society and the planet. Leaders must have foresight, bold visions and courage to pursue, so that the whole enterprise embraces the same goals and visions.

Take Netflix, for example. Fifteen years ago its business was mainly shipping DVDs to customers’ homes. Five years ago, co-founder and then-CEO Reed Hastings articulated a very different vision: the dream of owning a global entertainment distribution company that provides distribution channels for film production and entertainment.

Netflix’s leaders embed vision and purpose deeply into the company’s culture. Netflix successfully creates value for all stakeholders, including its customers, investors, creatives, and production staff. 44% of its total business came from production in 2019, the company’s revenue has tripled in 6 years, its earnings have grown 32 times, and its stock price has risen 57%, compared with the S&P 500’s 11%.

2) Be real and human

Today’s leaders must break through from being professionals and show their true self. This is actually more difficult than expected. Leaders need to learn, recognize and acknowledge their deeper inner self and not be afraid to reveal their essence. Corporate teams need to get to know and connect with each other, openly and frankly share values, beliefs, hopes and fears, thereby creating a sense of belonging and furthering the potential of the team.

3) Build collaborative teams

The new way of managing a business is to build a network of autonomous teams that work together in a transparent, trusting and collaborative manner, providing companies with an organizational structure that is more adaptable to change. What used to be a top-down command from leaders must now be transformed into empowering and self-managing teams that facilitate linkages and collaboration across sectors. Leaders need to relinquish authority and adopt an open mind while empowering teams, promoting transparency and collaboration.

Aon, which started through acquisitions, was already a consortium of disciplines each seeking to grow their business, leading to duplication and lack of coordination. Therefore, Aon’s leaders launched Aon United to carry out large-scale innovation to meet customer needs. It took Aon several years to fully adapt to the new collaboration model, training more than 10,000 colleagues, with the goal of changing old ways of thinking and behavior, and forming a collaborative network across regions and product lines.

Aon successfully built a collaborative network enterprise, united 60 sub-brands, covered 120 countries and regions, and increased its market value from US$6 billion in 2005 to US$50 billion in 2020.

In the next article, we will continue to discuss two other areas that leaders in the new era need to rethink and make changes

Ref: New leadership in an era of thriving organizations | McKinsey