Insights: 3 ways bold leadership can help businesses capitalise on opportunities

The Middle East is at an exciting inflexion point, poised to enjoy a significant period of accelerated growth.

According to the World Bank, the region’s GDP is projected to outpace the global average by 1.5 per cent over the next five years, buoyed by visionary leaders with sky-high ambitions — from Saudi Vision 2030 to We the UAE 2031.

Earlier this year, as part of Russell Reynolds Associates’ Global Leadership Monitor, we surveyed 2,700 business leaders in over 40 countries: board directors, CEOs, C-suite executives, and next-generation leaders. When we asked them to name the top threats to their business, only 51 per cent of Middle Eastern leaders cited economic uncertainty versus 64 per cent globally. Only 42 per cent in the Middle East cited technological change, compared to 53 per cent globally.

These numbers tell us that business leaders across the Middle East are less worried about the twin threats of technological disruption and economic uncertainty than their global counterparts. They are forward-thinking. They are embracing the latest technology, such as artificial intelligence. And they are ready to deploy capital to see their boldest plans through to fruition.

But thriving in this brave new world will require bold changes in leadership styles.

To be innovative, you need to be agile and cut through bureaucracy, and you need to foster the right kind of culture, where people are open, fearless and empowered to take (calculated) risks and make tough decisions.

Here are three things leaders can do to ensure their businesses are more agile and innovative, at this pivotal moment of opportunity.

Continue to transform towards a culture of innovation

Traditionally, businesses in the Middle East have tended to be hierarchical in structure, and conservative in approach. Recently, we’ve seen a noticeable shift at the board and CEO levels to adopt more modern and flexible styles of leadership.

Yet, despite advancements at the highest ranks, this appetite for innovation, allowing failures and risk-taking hasn’t always trickled down to the lower rungs of the corporate ladder.

This matters, because hierarchy is the enemy of agility, collaboration and speed. In hierarchical organisations, leaders below the CEO hesitate to make decisions, because they’re scared of making mistakes and upsetting those above them. This means crucial decisions can only be taken by those at the top, which inevitably slows everything down. Left unchecked, this can create an ‘execution gap’ between the bold visions coming from the CEO, and what happens on the ground.

To counter this, it can be helpful to empower leaders further down the ‘food chain’ to think and act for themselves—without fear of reprisal, should things go wrong. To innovate, you have to be prepared to fail and learn. You need to let people know they have your permission to innovate.

Accelerate investment in leadership development

Another key finding from the monitor is that 69 per cent of leaders in the Middle East would be ready to take a job at a different organisation immediately — and their number one reason is a lack of career progression.

In a competitive talent landscape, the best organisations are those that invest heavily in the development of their internal talent. Encouragingly, we’re seeing more investment in leadership development across the Middle East. Rather than hiring and firing, there is a growing focus on nurturing the next generation of local leaders, family members or expatriates into the organisation, with investments to make sure they are ready for their current role and are prepared for the next step.

This is a positive shift. Investing in talent development is a critical first step towards creating a more resilient, forward-thinking and proactive organisation. To keep pace with global trends in a fast-changing world, you need to instil a culture of continuous learning and belonging.

Continue to evolve board governance to ensure good leadership

Diversity is the lifeblood of innovation, and it starts with your board. When your board is filled with people who all think, act, and see the world through the same lens, it leads to ‘groupthink’—especially when the board is dominated by members with the same background and experience. We know from both our research and our professional experience that diverse boards make better decisions and drive better outcomes. That may include adding more independent members to the board.

At the same time, it’s important to be clear about where the balance of power lies between the board and the C-suite.

The role of the board should be to approve the strategy, not to set it. The role of the board should be to encourage and support cultural transformation, not drive it.

While board governance is improving, it needs to change faster. The efficiency of board and committee meetings, the selection of independent board members, and the quality and diversity inside the boardroom can all be improved, but it will take time.  Those who embrace and accelerate this change now can gain a crucial competitive advantage over their rivals, at this pivotal moment of opportunity.

Nicolas Manset is the head of the Middle East, and Jan Cron is the managing director and partner at Russell Reynolds Associates.

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