New Leadership - the New Way of Leadership

1. New Leadership Definition - what does Leadership 4.0 mean?
2. Why is it time for companies to introduce new leadership approaches?
3. What is a VUCA world and what does it have to do with New Leadership?
4. How are New Work and New Leadership related?
5. What advantages does the New-Leadership approach bring?
6. Introducing Leadership 4.0 - this is how it works
7. What tools can companies use to change to New Leadership?
8. That's why you should rely on New Leadership

For some time now, it has been almost impossible to avoid topics like New Work, New Management, and New Leadership. What is behind these (supposed) buzzwords that are unsettling the business world?

Our guest author Julia Kiener takes a look at the topic of “New Leadership” or “Leadership 4.0” for you and explains what exactly this means. She also shows you why future-proof companies should think about new leadership approaches, how to introduce these, and what advantages (and challenges) go along with a new leadership style.

New Leadership Definition - what does Leadership 4.0 mean?

To understand New Leadership as such, Julia first takes a step back and looks at how leadership is still understood in many companies today and what the differences are to the New Leadership approach.

The “classic” leadership that came into our working world with industrialization around 1800 (yes, some of our executives are still living in the 19th century) mainly focuses on two groups. On the one hand, there are those who give the commands, have control, and make decisions - also called executives. On the other hand, there are those who take on the executive role, accept tasks and act as order recipients - also called employees.

Although a lot has changed since the first industrial revolution, particularly the nature of work - technologies, machines and last but not least, digitalization - the classic decision hierarchies have remained in many companies. Even today, there exist in many companies, the for us no less learned structures of executives who distribute work packages, and employees who do their job.

The New Leadership approach, also called Leadership 4.0 or Digital Leadership, works differently and relies on synergies and self-motivation. While a classic leader delegates and controls work orders, a vision is formulated to the employees in the new form of leadership, trust is placed in them and they are empowered to make agile decisions and take responsibility.

In summary, New Leadership or a manager acting according to New Leadership principles is much more a coach who enables and supports the professional and personal development of the employees. The focus is on the person.

“This may work in start-ups, but certainly not in established companies or even in industrial companies”, I can hear you thinking. Caught?

Why is it time for companies to introduce new leadership approaches?

The Brazilian entrepreneur Ricardo Semler, CEO and majority owner of the Semco Group, already brought industrial democracy to his company in the 80s. His employees basically decide everything themselves - from working hours to salary. The satisfaction of the employees is extremely high, according to Semler. In an interview he mentioned that the annual number of employees quitting was only two percent, while the average for the same industry was about 25 percent.

What has been working for Semler for decades could also be an opportunity for other companies thanks to the rapid digitalization of recent years. More and more agility is required and topics such as New Work, New Management and New Leadership have been put on the table. Organizations increasingly have to react to the changes in the globalized world. The past years have once again shown us that we live in a so-called VUCA world.

What is a VUCA world and what does it have to do with New Leadership?

The term VUCA was originally coined by the US military. The acronym is made up from the following words and describes the fast pace of our modern world:

• Volatility (dt. Volatility/fluctuations)
• Uncertainty (dt. uncertainty)
• Complexity (dt. complexity)
• Ambiguity (dt. ambiguity)

In a nutshell, this means: We as a society are in constant change. Not only we as people have to get used to this and adapt quickly, but also companies and management boards. And in order to act agilely and react quickly to customer needs, a flexible organization is required that detaches itself from rigid constructs - like learned hierarchy levels.

How are New Work and New Leadership related?

In principle, New Work and New Leadership are closely related. If the working world and the demands of the customers transform, the leadership style and organizations inevitably have to change as well. In both cases, the change must take place primarily within the team. Following, we will show you why.

New structures can be a challenge and require patience. After all, the mentality of employees not to take an active part and to act as “subordinates” is a behavioral pattern learned over years or decades. And as you know, learned habits cannot simply be switched off after just one workshop, but can only be replaced by new ones through training - that is, constant practice and repetition.

An example of our new demands and how they can also be translated into organizations and a new form of leadership are the topics of transparency and information flow. Due to the rapid and constant upheaval, we live in an increasingly technologized world. We are used to always being up to date and have developed the urge to always get all the information in order to form our own picture of situations.

Classic “bottlenecks” and sole decisions by the management board, without letting the employees participate or - even better - involving them in processes, clash with this. What otherwise inevitably leads to discontent can be prevented through transparent communication and participation in restructuring. Where employees are actively involved, totally new perspectives and initiatives often arise.

Speaking of initiative and participation: We humans increasingly want to see the meaning in our work and be perceived as individuals. Modern leaders should therefore view their employees as such and be aware of the various needs and requirements for work and team leads. Because only satisfied employees, who are more than a personnel number for their superiors, willingly face the challenges within the company, continue to develop, and take on responsibility - also beyond their tasks defined in their employment contract.

What advantages does the New-Leadership approach bring?

I have already listed many for you. However, the most important (economic) aspect is quite simple: More success for the company. When New Leadership replaces rigid leadership structures, flexibility in teams is promoted, which in turn leads to faster decision-making processes, which supports the faster adaptation to changing customer desires.

Because, employment psychologists and experts agree: The best goals are achieved when teams are satisfied, open, and involved. Appreciation and participation are key because linking positive emotions with one's own work leads to open communication at eye level, strengthens cohesion, and lowers the frustration level.

Leadership 4.0 offers the opportunity to motivate one's own employees at a new level through the transformation from the manager to the enabler of one's own people. And appreciative, transparent communication at eye level has another side effect: it not only creates a positive atmosphere, but also emotional security. Because backing - even when something goes wrong - is essential for the full development of employees in their working environment.

Introducing Leadership 4.0 - this is how it works

You're thinking: “Sounds great, but where do we start?”. Understandable, because what sounds like a good idea on paper is not easy to implement in every company overnight. Terms like Change Management and cultural change seem big and powerful.

I always advise companies that want to make changes to their organizational structures to brace themselves for the future of the working world, to bring in external consultants. These usually bring a lot of experience, methods, and examples that can set initial impulses and offer long-term mentoring of the management, but also of the employees.

You can see how we at Pommes al dente tackle the topic of - as we call it - iterative change management in the exemplary timeline below. Iterative change management also includes changing thinking from classic leadership to trust-based Leadership 4.0.

The most important aspect that should not be neglected in any change process is voluntariness. But in general, it never fails, because the desire for change would not arise if first people in the company did not give impulses. Ideally, these are even the managers who, by reinterpreting their role - away from the “task-distributing” towards the “enabler” - are leading by example.

However, “pilot groups” should be established in larger companies, which have, for example, previously undergone a kind of internal application process. They are the ones who develop new processes and ways of working in connection with the external consultancy.

It is important to focus on a heterogenous group here - consisting of executives, employees of various positions and experience levels. They should represent a representation for the entire company - not just for individual sub-areas.

What tools can companies use to change to New Leadership?

There are numerous New-Work-Tools for collaboration that may assist introducing New Work working methods. These include Collaboration-Tools like Asana  or Miro that allow for digital collaboration on projects. We use both tools in the collaborative work with our customers, but also in our own team. Asana offers the option to bundle work packages in a clear manner and at the same time make the status of projects visible at a glance.

Miro on the other hand, can be used creatively and works perfectly for location-independent brainstorming. As an alternative, I also like to use MURAL. Both tools, by the way, have many templates at hand, which I use to design playful getting-to-know rounds in workshops or to work on topic blocks together.

A first step towards a newly lived leadership culture can also be to introduce tools for employee surveys. Leapsome for example, offers more than vacation or capacity planning, but combines functions like employee interviews, goals and OKR, onboarding, meetings, employee surveys and more. Similar tools can be found in the HR-Category of OMR Reviews.

That's why you should rely on New Leadership

New Leadership is part of New Work and thus part of a change process that cannot be implemented overnight. However, the opportunities to become a coach of your own team as a leader and thus promote the personal development of the employees and contribute to the success of your own organization show that it is worth it.

Organizations adapted to the VUCA world can also act more flexibly and respond faster to changes.

External consultants can support the journey towards lived New Leadership with the help of methods, thoughts and mentoring. Like all challenges, the key is communication - within teams, but also across organizations.