Changes in the business environment and how they affect you

I was asked the other day how trends in the business environment are affecting managers. Where to start …

Business complexity is increasing exponentially, so understanding the big picture and using systems thinking are becoming more important. Risks are increasing, too, so you need to know how to build a sound risk culture to protect your organisation and its assets. And the pace of change is quickening.

Each of these three factors mean that you won’t–you can’t–always know the answer. Many problems you face and will face are new and many are unpredictable. You probably can’t do what you’ve always done, or even what you did before in a similar situation that worked, because so much will have changed in the meantime.

This means you need to be good at problem solving and coming up with unique and unexpected solutions to problems and situations, ways to meet customer demands, and ways to respond to a changing marketplace. This has three implications:

  1. You need to know how to ask the right questions, questions that help you explore and analyse situations.
  2. You need to know how to apply the scientific method and use data so you can get a good grip on situations.
  3. Learning to think in scenarios is probably a good idea.

New and disruptive business models, share price volatility and diminishing corporate profits may all put your organisation at risk. Therefore, you want to protect your career and see yourself as ‘Me Inc’:

  1. Develop solid, wide and deep networks.
  2. Build a professional image (on social media, with your professional bodies and networks, in your organisation, with suppliers and customers, etc.).
  3. Keep your skill base up-to-date.
  4. Broaden your experience base.

Organisations are likely to increasingly move to capabilities-based competition: creating value and competitive advantage through capabilities in processes rather than through capable functions. We’re likely to see more strategic alliances, too: collaborating with non-competitor organisations to combine strengths to produce a better product or service. And the supply chain is becoming more important.

These three factors mean:

  1. Big picture and systems thinking is important. Get in the habit of considering the upstream and downstream implications of every your action and decision.
  2. You’re likely to find yourself working in cross-functional teams, so hone your people and team-working skills.

Cheap wages are moving from China to Cambodia, Eastern Europe and South America. This means you can benefit from polishing your cultural intelligence, learning about other cultures and learning to work, virtually and actually, with people from other cultures.

Employees and the way they work are changing. Baby Boomers are moving out, Generations X and Y are taking over and Generation Z is entering the workforce, making it age-diverse as well as culturally-diverse and life-style diverse. People’s motivations for working, what they want from work and how they work are vastly more diverse than was the case even 10 or 15 years ago.

The changing workforce means we’re seeing more team-working, more flexible working and more virtual working. Jobs themselves are changing: we’re seeing more cross-functional team work, as mentioned above, more projects and more fixed-term contracts. We’re seeing roles, more than jobs–roles are looser and more open, not as prescribed and rigid as jobs.

This means the way you lead and manage people is changing. Here’s what I think is really important:

  • skilful leadership
  • skilful communication
  • engaging with team members in terms of motivating and coaching
  • flexibility in your management and leadership style
  • clear, logical thinking informed by an understanding of the big picture issues of the environment you’re operating in externally and internally.

Since industry isn’t spending a lot of time and money on learning and development, you’re probably left to your own devices to keep upgrading your skills and knowledge. All while being, no doubt, mind-bogglingly busy in your day-to-day role. A big ask.

This means applying the learning cycle is a good idea, lest you get caught up on the treadmill and fail to improve yourself, your performance or your work procedures.

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