In the world of business, particularly at the executive level, the term “vulnerability” often carries a connotation of weakness. Traditionally, leaders are seen as figures of unwavering strength and certainty. However, embracing vulnerability could be one of the most strategic moves a leader can make, significantly impacting the bottom line of their company.
Embracing Uncertainty in Leadership
For the C-Suite, the realm of decision-making is fraught with uncertainty and unpredictability. Any major decision, whether choosing a partner, selecting a project for investment or selecting a message for a major marketing campaign, must be made with painfully limited information. In such circumstances, statistics show a stark reality: Only 10-20 percent of features in most apps are actually utilized by users, around the same fraction of startups that secure venture capital funding return a profit to their investors. We see the Pareto-Law in action. This high-risk environment underscores the necessity for CEOs and other leaders to be open to reevaluating decisions and directions continuously.
Overcoming the Sunk Cost Fallacy
Many organizations continue to pour resources into non-performing projects well past the point of viability. Why? One key factor is the cultural aversion to admitting defeat or error. This reluctance stems from a misconception that every investment must yield returns, a fallacy that often leads to greater losses. Promoting a culture where it is safe to voice doubts or concerns can help identify faltering projects before they drain more resources.
Ask yourself: What percentage of your organization’s projects are eventually stopped?
Leadership and the Culture of Perfection
As an executive, your actions and attitudes are likely to set the tone for the entire organization. If you present yourself as infallible, a comfortable position for anyone, you inadvertently establish a company culture where perfection is the goal, and criticism becomes the enemy. In these environments, employees often hesitate to speak up or question existing practices, especially when it involves criticizing current projects.
Often, this leads to a false sense of harmony. And when criticism does occasionally emerge, it brings significant drama, leaving behind a mess that requires considerable cleanup.
For success, an organization requires its employees to consistently identify weaknesses and take action without getting entangled in interpersonal conflicts. Viewing failure to find the best solution on the first try as a part of the job rather than a personal fault is crucial.
Fostering a Culture of Constructive Criticism
Here are three ingredients to cultivating a culture where tough feedback is leveraged as a strength rather than shunned as a weakness:
Lead by example. Demonstrate humility and openness to feedback. Show that you value input through your actions, whether that means revising strategies or openly discussing your own learning curves. If you make it a habit to look for one thing every day where you can do the following, you will provide a positive example to everyone around you:
- Ask for advice from your subordinates
- Openly admit that you don’t know something
- Openly admit a failure
It’s very important what kind of internal stance you take when making these statements. If you follow this advice, be sure that people will pay attention and they will know how you actually evaluate these statements yourself—as a failure or as a service to your organization for not letting a problem fester for too long.
Establish formats for safe negative feedback. Whenever we want to change a culture, introducing a new structure or format that integrates the new element into your culture is useful. One such format for altering people’s stance towards negative feedback is called “ritual dissent,” a method developed by Dave Snowden.
Here’s the process in a nutshell: Person A presents a project plan, a business idea, or something else they’d like to evaluate to a small group and asks them to treat it as if it were a potentially harmful idea. Their task is to discuss amongst themselves, identify as many flaws as possible and metaphorically tear the idea apart.
Person A faces away from the group so they can’t see his/her reactions and don’t communicate with him/her directly. Instead, A listens in on their discussion, capturing all the critical points they raise that elicit a reaction and ignoring the others. Afterward, there is no discussion of the points raised. A has gathered the feedback he/she needed and will decide what to do with it.
In this setup, the face of the presenter is hidden, encouraging more candid feedback. Since the group talks among themselves rather than addressing the presenter directly, it allows the presenter to truly absorb their points without becoming defensive. Snowden’s method prevents premature consensus and superficial discussions within groups.
But what is even more interesting, once you ask participants to reflect on what they experienced during the ritual dissent and why the invitation to “destroy” an idea may be useful, something most people find uncomfortable at first, they figure out on their own why criticism is so useful. This often marks the start of many fruitful conversations and the first step in transforming an organization’s culture from one that avoids feedback to one that actively seeks it.
Invite diverse perspectives. Now you are showing your own vulnerability and creating multiple opportunities for giving and receiving negative feedback within your organization. But there is a final way to ensure that your organization doesn’t hear criticism: by remaining confined within your own walls.
“Get out of the building”—this famous advice for entrepreneurs from Steve Blanc, a professor of entrepreneurship at Stanford, is critical.
As their leader, you need to ensure your organization builds a network of people who can provide an external viewpoint. These could be current or potential clients, users of your products, or other experts. Some may need to sign NDAs and receive some form of compensation.
Yes, you are asking people to provide negative feedback to your organization and may even pay them for it. However, the return on this investment is significant because it helps you differentiate good ideas from ineffective ones. Most companies and leaders won’t do it, they are afraid. However, those that do have a sustainable competitive advantage.
Incorporating vulnerability into your leadership style isn’t about showing weakness, but rather about fostering a transparent and adaptable corporate culture that can weather the storms of the business world. By embracing tough feedback, you not only enhance your company’s agility but also its ability to innovate and grow in a healthy, sustainable way. Leaders who understand the value of vulnerability position their companies to thrive in an unpredictable market, proving that sometimes, the greatest strength lies in acknowledging our limitations.
