People + Strategy Journal

Winter 2021

Executive Roundtable

Leading amid uncertainty is a fact of life for technology executives, whose industries face constant disruption. Here three leaders share lessons about managing when the path ahead isn’t clear.

By Adam Bryant
Executive Roundtable

​When Leading in the Fog Is a Fact of Life

Leading amid uncertainty is a fact of life for technology executives, whose industries face constant disruption. What lessons can they share for leaders in other sectors? Adam Bryant, Executive Roundtable Editor, interviewed three current and former CEOs with deep experience in managing when the path ahead isn’t clear. Their comments were edited for space and woven together in a roundtable format.

Participants
  • Abe Ankumah, CEO of Nyansa
  • John Donovan, former CEO of AT&T Communications
  • Penny Herscher, veteran Silicon Valley board director and CEO

People + Strategy: To be a technology executive requires a certain comfort level with leading in a fog, given the constant disruption. Have you always been comfortable in those environments?

Penny Herscher: Many people get drawn to being a technology executive because their first interest is the technology itself. I don’t think you end up as CEO of a technology company unless you find the whole space fascinating, including the underlying rate of change. That in itself grounds you, and it’s what draws people in. It certainly drew me in.

I have always found change much more interesting than stability. Part of what makes technology so fascinating is that it’s never stable. You have to be looking at three, six, nine, twelve months ahead in a somewhat paranoid fashion to be able to respond to how fast things are going to change. If you don’t enjoy that, you don’t become a tech executive.

Abe Ankumah: I’ve always had a mindset of being willing to learn and being prepared to undergo change. My parents were entrepreneurs, and I’ve lived in the San Francisco Bay Area for a long time now, and there’s a little bit of a rush that comes with change. I’m comfortable with uncertainty and knowing that the only constant is change.
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Abe Ankumah

“The cultural foundation starts by admitting what you know and don’t know, and being clear about the incremental steps you’re going to take to get more information and learn about the market. ”
—Abe Ankumah, CEO of Nyansa

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The best way to deal with change is to think about your customers. In so many ways, we use customers as the folks who illuminate the path ahead of us. And you can’t take the need to change personally. If you have to shift direction or adapt an idea or manage through that fog, it’s not an attack on your ability.

John Donovan: I remember my dad saying to me when I was a teenager, “Take risks in your 20s and don’t say no to opportunities; just gain the experience.” I’m the eighth of 11 kids. After the first two stayed in Pittsburgh for school, he said, “You can go to any school you want as long as it’s not here.” He wanted us to experience the world. When he dropped us off at college, he said, “We’ve done our part. Now things are on you.” You make mistakes but you pick yourself up and you recover.

In the beginning, I had this tremendous discomfort around ambiguity. But then I came to understand that if something is hard, there’s going to be a benefit on the other side of it. And then I just started to get comfortable. By the time you fast-forward 20 years in your career, it’s very much the Steph Curry effect, which says that when you get in the zone, there’s no shot that’s too far away. You’re not going to panic, and you have the clarity.

P+S: Were there specific moments that come to mind when it felt like leading in the fog?

Donovan: After a big hurricane, I went out to meet with the teams who were going to be working 20 hours a day to get critical infrastructure back up. Every company has its protocols about how business is conducted, and those are guideposts. The first time you realize you are in charge is the day that you tell someone to do something that’s completely different than what’s been done in the past. 

As I spent more time with our teams, I came to understand that some of our business processes weren’t as empathetic as they should have been. When I addressed one particular team, I told them, “You have no set budget. You’re all experienced. You’ve done this before. Make the right choices. The second thing is take care of your safety first. You have to have your brothers’ and sisters’ backs every day, because you should never feel like you’re alone in this environment.”

To me, that was a big and empowering moment to realize that most of the scripts that companies use in crises don’t capture the human element of how people feel and how you address those emotions and feelings. In uncertainty and in chaos and in business pivots, those things are all underappreciated.

P+S: One challenge for leaders who are navigating the fog is facing employees at all-hands meetings who ask you how you know the plan is going to work.

Herscher: Employees do that all the time. When the dot-com bubble burst and I was running a company called Simplex, I decided that the only way we’re going to raise enough capital to continue to grow was to go public. I had board members and employees saying, “How do you know you can do it?” I basically said, “Because I can sell. I know that if you put me in front of investors, I can share the story with them and they’ll see how exciting it is.” Half the board thought I was crazy, but I was right.

CEOs who can sell are good at telling a story. They’re good at up leveling the vision and strategy and weaving it into a story so that other people can understand it, relate to it, connect to the story and believe. When you’re a CEO, you’re not selling product. You’re selling the concept of your company. 

Ankumah: I try to set the direction without being overly prescriptive. People respond well to leaders who are humble enough to say, “Here’s what I know, here’s what I don’t know and here’s what we have to work on together.”

It’s also about creating a culture in which, from time to time, I say to my leadership team, “If we were to all leave and rehire ourselves again and come in without any history or emotional attachments to a particular way of solving the problem, how would we do it?”

This is something that Andy Grove at Intel used to say. It’s about mentally firing ourselves so we can walk through the door again and ask ourselves what we would do differently. It crystallizes a frame of reference and reminder not to feel so personally attached to things. 

The cultural foundation starts by admitting what you know and don’t know, and being clear about the incremental steps you’re going to take to get more information and learn about the market. It goes back to working with your customers to illuminate the way.

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John Donovan “You’ve been selected, elected or chosen to be the person right now making these decisions. And if you weren’t the best one to do it, someone else would be in your chair. How do you step up and organize your thinking to get through the other side of this? ”
—John Donovan, former CEO of AT&T Communications

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P+S: Some leaders show up in those tough moments at all hands-meetings and some leaders retreat to the shadows.

Donovan: The question is, how do you feel when you should be in the game and you’re not? If you’re in a town hall and you weren’t asked the hardest questions, how do you feel? Like you dodged a bullet? These are the real subtleties of leadership. If you leave a town hall and you didn’t get the hard question, then you didn’t dodge a bullet; you became less of a leader.

I would always sit with a couple of colleagues before a town hall and tell them to give me a list of all the questions that people are going to be hesitant to ask. And then I made sure those questions were read first. It’s part of building trust. 

P+S: If you were to give advice on leading in the fog to a leadership team at a big legacy company that was struggling with predictability, what would be your advice to them?

Herscher: You have to have a conversation about your comfort with risk, because you’re taking on a level of risk with any path you choose. Be very clear about the immediate risks and long-term risks that you face.

The second thing is to be comfortable laying out alternative scenarios. Face your risk. You might say that if A or B happens, then you’re going to run out of cash. If C happens, we’re going to be okay. Then you walk the leadership team through what you believe are the three or four top choices for how to proceed in each situation. How bad are they and how would you respond?

My observation is that many leadership teams aren’t comfortable doing broad scenario what-ifs. It makes them uncomfortable. On one of my boards, I asked, “What if XYZ happens and you’re out of cash in October? What are you going to do?” Just asking the question is so powerful for the leadership team. If you don’t ask the question, they don’t go through all the logic of how it might happen, and then think about how to prevent it by managing to other priorities.

It’s as if you have to ask the leadership team, “Are you comfortable asking each other these scary questions?” Because once you can name them, they’re not quite so frightening. I find that more conservative leadership teams typically don’t want to look at the bad possible scenarios. It’s easier not to think about it. But if you’re facing a difficult, scary situation, thinking through the worst that can happen helps you prepare to prevent that worst thing from happening.

Donovan: The most important thing is to realize that every business leader during the course of their 20 or 30 years of serving in leadership roles is going to have these moments when you’re in the eye of the tornado. You’re going to have them. They’re always going to feel bigger than the last one, but you do come out the other side.

Some people have the idea that somehow they have to always know what to do. They don’t. You just have to be the best leader you can be. 

You’ve been selected, elected or chosen to be the person right now making these decisions. And if you weren’t the best one to do it, someone else would be in your chair. How do you step up and organize your thinking to get through the other side of this?
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Penny Herscher“CEOs who can sell are good at telling a story. They’re good at up leveling the vision and strategy and weaving it into a story so that other people can understand it, relate to it, connect to the story and believe.”
—Penny Herscher, veteran Silicon Valley board director and CEO 

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P+S: Moments of ambiguity are balancing acts of confidence and humility for leaders. How do you think about that?

Donovan: There’s a rail on each side. One is that you’ve got to be genuine, and when you don’t know, you have to say that you don’t know. That way, you can learn and make sure you’re not falsely heading down a path that you’ve committed to. On the other side, you have to be followable. You have to have enough clarity that people say, “Yeah, that’s a good plan.” 

I made a decision to help a friend who’s in a business serving restaurants, and his was the most devastated business that I could ever imagine. I told him, this is a Rubik’s cube, and the game is not over. It’s the beginning. Someone gave you a blank sheet of paper, and everything that’s happened is now experience and nothing more. Let’s build a company from scratch starting today.

He’s completely reshaped the business. He became the leader instead of the victim. That’s the mindset. Anybody who looks at COVID-19 who doesn’t say this is a great opportunity is not thinking about it the right way. The biggest impediment you have is your rearview mirror. Tear it off, because it’s only going to disserve you because you’re going to be looking to regain the stability you had in the past. 

P+S: Any advice for HR professionals specifically about leading in the fog?

Ankumah: You have to spend time thinking about how your transformation should influence your talent strategy. What often happens with companies that have been wildly successful doing a certain thing is that employees wonder why they need to change if they’ve been so successful. The right talent strategy will team up the current people on your team who deeply understand the existing business with people recruited from the outside who understand the fundamental drivers of the new direction you’re headed.

At the end of the day, it’s all about the people, and the fundamental challenge is leveraging the mix of people who are looking inward to optimize the current business and those who are looking outward at new directions and opportunities. You also might have to fundamentally change the things you’re trying to measure, given your new priorities.

If you keep measuring the old things that made you successful but you’re trying to change to something else, that’s clearly a disconnect. It’s one thing to give lip service to the idea of change. It’s another to say that we’re trying to change, this is why, this is how we’re driving change and this is the scorecard we’re going to use to measure that change, along with the right incentives and reward systems to drive that change.

P+S: Penny, you mentioned earlier the importance of leadership teams discussing worst-case scenarios and planning for them. What is the role of HR leaders in these discussions?

Herscher: The strongest HR leaders ensure that the real conversation is happening in the room with the leadership team and making sure that some people aren’t being shut down so they can’t express their concern about the fog. You also can’t have those discussions happening in a back room without the whole leadership team being included. Strong HR leaders who also act as coaches make sure the whole leadership team is engaged in the conversation.