In Times of Volatility

Friends,

 This week, a man in his early 80s told me that he thought this was the most uncertain week he had experienced since he was a young man during World War II.  He pointed to many aspects of this great volatility: Hurricane Ike, Lehman Brothers’ bankruptcy; governmental takeovers of Fannie Mae, Freddie Mac, and AIG; another volatile, toss-up presidential election; the Detroit mayoral mess; crazy fuel prices, rising unemployment, the ongoing mortgage crisis, and a nearly crashing Wall Street.  Yikes!

 Perhaps in your local world, you could point to added uncertainty and volatility.  Our lives change and get crazy.  In bunches, come graduations, marriages, illnesses and death, layoffs and sweeping changes at work.  What would you assert to be the key guiding principles of leadership in highly volatile times?  I’d suggest these:

 1.    Be more visible.  I remember running at night in downtown Savannah last fall.  I got clear directions from the concierge, but my confidence fell away and uncertainty swirled as I took my first steps in a dark and strange city.  I quickly found patrol cars circling the streets like bees at a cider mill.  My anxiety level fell completely away.  Likewise, the presence of Treasury Secretary Paulson this past week has been important for (as the candidates love to say) “Wall Street and Main Street.”

2.    Interpret reality in a larger context.  President Bush has continually tried to put the insecurity (and suffering) of Iraq into some sensible context.  It hasn’t been credible to all, but he has been consistent and vocal.  My wife continually worked to assure people during the Detroit mayoral crisis that there was a legal process, and that it would be followed.  Parents explain to children in divorce that there is a bigger picture, and that they will still be loved.  Explanations are not easy to hear in tough times, but they are essential to lower anxiety so people can continue to function and attend to their work.

3.    Focus people’s attention on things that make a difference.   This is perhaps hardest.  During crisis people want their authority figures to protect them – to be visible and to be reassuring.  People look for painless, external, authority-created answers – what Ronald Heifetz calls “technical fixes” in his book Leadership Without Easy Answers.  Buying 80% of AIG is a technical fix.  But, beneath the technical problems and fixes are almost always difficult issues that must be faced.  And in this financial crisis, there’s plenty of work to go around: for labor and management, for borrowers and lenders, for regulators and the regulated.  Great leadership points people to do that work.

 You might gauge the level of uncertainty and volatility in the places you lead.  If it’s high, you can bet people are distracted from the work.  And it falls to you to be present, to interpret, and to focus them back on the work at hand.  Let me know what you think, as you…

 Lead with your best self,

Dan