On a particular Friday in May, executives from globally renowned corporations participated in an unconventional video meeting. They were instantly taken back to the catastrophic Atlanta Olympics in July 1996 that was struck my a deadly pipe bomb incident after a week of smooth proceedings. The crucial concern raised by Edouard Getaz, a movie producer turned leadership coach, was whether the games should go on.
The executives spent several hours in a simulation exercise during which they listened to audio tapes and watched video clippings of the key personnel at the time – from the FBI to the International Olympic Committee – to determine the best next steps amidst the crisis. The participants separated into groups to discuss, try out their propositions and acquire feedback.
Getaz’s firm, InsideRisk, provides these in-depth leadership training programmes to executives of companies such as Airbus, Richemont and HSBC. These programmes aim to provoke authentic emotional reactions to potential business crises.
As leaders of the corporate world grapple with a multitude of adversities, such as the pandemic, economic instability, political disturbances, and disturbances in supply chain, these practical, immersive coaching techniques are rising in popularity. Corporations recognise the importance of maintaining their reputation and possessing the expertise to effectively guide their companies through crises, given the tight regulation, elevated expectations for corporate conduct and transparency, and the speed at which negative news can spread on social media platforms.
“Crisis management and leadership coaching are merging”, Getaz states. He believes that experiential learning, which is deeply rooted in neuroscience and behavioural economics, is a necessity in the contemporary business milieu and that conventional teaching and training strategies “are ineffective”.
Getaz’s ultimate intention for such practical training is to stimulate “cognitive breakthroughs”. He wants to eliminate the era of instructing via PowerPoint slides that prioritise academic theories and business methodologies rather than presenting real-life situations.
The idea behind these training sessions is that realistic, high-stakes situations assist executives in carving out practical solutions for problems and enhance their decision-making capacity in stressful times. Participants engage in learning that, according to providers, results in a higher retention of knowledge. Immediate feedback allows executives to learn swiftly and modify their methodologies as needed. Role-playing and virtual reality training in simulated scenarios also adds an element of enjoyment to the process.
Mastering the ability to handle any given circumstance is a pivotal development for top-tier talent and high potentials, points out Getaz. He wishes for leaders to gain insight and learn from the experiences of those who have faced high-pressure situations. As the classic MBA program experience is being increasingly questioned, learning methods are concurrently evolving.
MBA programs, widely considered to cover fundamental business areas such as finance, marketing, accounting, strategy, and organisational behaviour, have long been respected. These programs often provide rich networking and internship prospects, leading to secured employment. However, the fast-paced evolution of technology and disruption of traditional business models are rendering many MBA curriculums obsolete by the time students step into the professional world, according to some business executives. Coupled with intensive admission processes, high course fees, and lengthy programs, these are some of the challenges faced by MBA students.
Practical experience specifically relevant to a position can be deemed more valuable than theoretical knowledge by employers. Consequently, online courses, specialised certifications, and immersive training opportunities have grown popular and are often favoured as they offer more precise, flexible education at a cheaper cost, usually covered by employers.
Alternatives such as these can be especially helpful for seasoned executives faced with high-stakes decision-making. Corporations can customise courses to suit their specific requirements and delve deeper into the skills needed at different leadership levels.
David Novak, ex-CEO and chairman of Yum Brands, mentions in his new publication ‘How Leaders Learn’, that we gain insights by taking action. He adds that traditional classroom learning does not consistently yield self-awareness around the obstacles that hinder our personal growth and receptiveness to new ideas and experiences. This becomes an especially formidable obstacle for anyone, especially in light of the ongoing radical changes we face.
Offering his perspective, Bret Hood, a former FBI special agent and expert on financial crime who’s now a leadership consultant, believes that experiential learning immerses you in unexpected decisions. He attests that he was compelled to assess his objectivity and ethicality from an entirely different perspective.
Contrary to my initial belief that I would always uphold legal standards and make faultless choices, these experiences have shown me that circumstances, stress, and seemingly minor factors like personal affinity can influence my decision-making, both consciously and unconsciously, argues one executive.
He also underscores the potential drawbacks. Recognising the conflict between one’s perfect self-concept and the actual self can be deeply unsettling for some. Such incidents can shatter our self-perception and can be highly distressing, he remarks.
Scholars at University of Sydney’s Business School and Judge Business School at Cambridge emphasise that a sequence of events often creates considerably more reputational harm than one-off situations highlighted in “war game” training exercises. They reference the string of production and safety failures experienced by Boeing following the crashes of its 737 Max fleet.
Corporations have increasingly started to utilise in-house experiential training. For instance, in Britain’s financial sector, the Bank of England enforces routine “fire drill” tasks for boards.
“Proactive and successful companies regularly scrutinize their crisis management procedures through simulated emergencies like system shutdowns, loss of data, and cyber threats,” says Joe Garner, the ex-chief of HSBC’s UK retail division and of Openreach, BT’s infrastructure wing, currently an executive trainer. He adds, “The most effective simulations are highly realistic, incorporating elements such as simulated media interviews for the CEO. Personally, I found these drills eminently practical, gaining numerous insights from them.”
The highest efficacy is achieved when the simulations are observed and critiqued by proficient professionals who can offer constructive feedback on the team’s performance under stress, he informs.
While stressing that no training can completely equip an executive for the high-stress decisions sometimes needed at 2am amidst a crisis, he assures that like every skill, crisis management also enhances with practice.
He underlines the optimum results are seen when theoretical training and practical simulations can be directly applied to real world scenarios, and observes that there has been no shortage of such opportunities. He concludes, “Events like the 2008 financial crisis, the Covid pandemic, and Brexit offer plentiful practical training for the current generation of CEOs. © Financial Times Ltd 2024
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