Crash Course in Crisis Leadership

comes to being a prepared leader. We're talking about Erica H James. She's dean of the Wharton School at the University of Pennsylvania. She joins US now via zoom from Philadelphia. You've heard it before, but it's worth repeating. New Book along, written along with Lynn Perry Wootton, is the prepared leader emerged from any crisis more resilient than before. Erica, it's good to have you on a Bloomberg Business Week. How are you? I'm great, Tim Carol, thanks for having me.

Thanks so much for joining us. So you know, I know that you and Um Lynn wouldn't have done decades of research into leadership. What is the sort of common thread that ties all leaders together, whether we're talking about leaders of companies, leaders of business schools or or leaders of countries. Well, there's more than just one common thread, but I think there are a couple that are really important. One is a focus on what you're trying to achieve.

What's the outcome? WHAT'S THE VISION? What's the direction that you want to take your organization, Your City, Your Unit Um? And then the second is the ability to communicate effectively so that people buy into what it is you are asking them to do in order to get to that outcome or get to that vision. So communication of your outcome or desired end goal are the two things that are common among all leaders. has there been any kind

of rethink on leadership coming off the COVID pandemic? I do think, you know, all leaders kind of took a real deep look at themselves and and and their strategies and how they deal with employer employees, especially as I feel like employees still a bit in the driver's seat at this point, when you've got a lot of workers are still saying I'm going to work at home, why I don't want to come back to the office. Um. But tell us about kind of the impact of the pandemic.

I think the pandemic rocked everyone's world and you know what we thought to be true? The safety was which we thought are our universe operated in, was all sort of thrown up in in in the wind. Uh. So I do think that leaders are thinking about their responsibilities differently.

I think they're thinking about their outcomes differently, I think they're thinking about their people differently and to your point, Carol Um, that rethink is being pushed a lot by employees and recognizing that they are in the driver's seat.

They have a lot that they want to contribute, but they want to contribute in their own way and under their own terms, and I think leaders are now trying to come to terms with how do we manage in an environment where, you know, they were in charge, they set the rules, they set the policies and now have to be flexible to changing demographic and changing interests of their key stakeholders. Isn't this a good thing? Isn't this a great thing? It is a great thing and it

will be a great thing over time. I think right now we're caught up in this middle stage where we're not quite sure where to exert influence and pressure and where to pull back. And until we sort of normalize Um, the flexibility, until we normalize what you know, the need to listen to a variety of stakeholders and and add their and put into the equation of our decision making, we're going to still be going through a pretty rocky period,

I would argue, for a couple of years actually. You know, it is interesting too, when I think about a crisis like I hit you right and you're in the midst of it, you've got to deal with it and you're running around, you know, putting out fires and so on and so forth. But there are crisis that you know, as a result, stay with a company or a leader for a long time. How do you think about that? So in our work we talked about two different kinds

of crisis. We talked about the sudden crisis, which is, as you describe, something that sort of happens out of the blue, we didn't really anticipate it, and oftentimes it's an externally imposed threat. So you know, the weather conditions in Puerto Rico right now are a crisis for that region of the world. Um At, a Paris attack is

a crisis that happens pretty suddenly. And yet the kinds of crisis that we tend to deal with on a day to day basis but never really invest in learning how to manage them well, or what we call smoldering crises. Those are those things that are internal to the organization, oftentimes the function of poor decision making or in attention to particular issues, that just bubble onto the surface for quite some time until they erupt into something pretty significant.

And I think both of both kinds of crises matter and we need to be responsive to them, but we tend to we in the UH, you know, create practices around the sudden crisis and less so about around the small green ones. We do want to get back to our guest. We're talking with Erica James, dean of the Wharton School at the University of Pennsylvania. She and her co writer have a new book out with Lynn Perry Wooden. It is called the prepared it's been a long day.

The prepared leader emerged from any crisis more resilient than before. Um Erica, one thing I wanted to ask you. We're always interested in particular leaders and I'm curious what leaders you looked at uh in terms of what do you say? Well, I was just gonna I'm so sorry to interrupt your carrol. There are there are some really good Um blurbs on the back of the book from familiar leaders. Ross brewer over at Walgreens, boots alliance, at bastion, Delta, James Gorman, chairman,

and Ce old Morgan Stanley. So I mean they've read the book. Yeah, but we're wondering about lessons like, you know, who specifically we should be looking at? Yeah, Erica, like it's just in this world it's so phone to get some specific examples of like kind of leaders that you guys have looked at who have come under pressure and had maybe their leadership tested. Yeah, well, I mean you named three terrific ones, all of whom were leading tremendously

important organizations. UH, during the during the pandemic. You know that the transportation industry was thrown for a loop in the middle of the pandemic, and so what was you know, at bastion leading Delta through that? I remember talking with the colleague a Delta who said, Erica, this was the day that our revenue basically went to zero, which meant nobody was flying anywhere on Delta Airlines and that's a

pretty tough place to come back from. Uh. So I he is a CEO that I admire tremendously and what he's been able to do both in terms of, you know, through the pandemic, managing all of the different mandates around mask wearing, not mask, not mask wearing, that the political dynamic that is a part of that conversation, managing the Um the passengers on the plane and increased fighting and all sorts of stuff, and they handled that as well as could be expected under the circumstances and I think

part of what we saw in his leadership, for example, was a willingness to be really authentic, to talk very clearly about what they their decision making, why they were making their decisions. UH, set new guidelines, allow other people in the organization to come forward with their ideas and thoughts for for managing the situation and just sort of being in the throes of this with employees to get better.

Dean James, I'm wondering if you know in your classroom you can identify, just by interacting with students who are going to be the next CEO Su a fair question. Good question. UH, no pressure. The students are listening and right yes, Um, it's it's hard to know for sure, but clearly there are people who have this spark about them, who are very articulate and what it is they're trying to achieve for their life or what problem they're trying to solve, and you can tell that they will be

in a significant leadership role. Whether they are CEO or whether they're an entrepreneur. That's more difficult to predict, but there are some people who are just so clearly focused on contributing good into the world in some way that you know that they're going to rise to some significant level in society. It's so I mean I'm just trying to think right now about people I was in school with who have, you know, mostly high school at this point, who have gone on to incredible careers that I would

never have guessed for them. And what what really, you know, surprised me about them and if they had that that leadership style, well, well, well, just to build on Tim like I think you know, is it fair to say, Erica, that people can have qualities that would make them initially put them in a position to lead something, but then it comes to maybe leaders who can do well when everything's doing well, versus the leader who all of a

sudden is faced with a test or a major crisis. Well, I love that question, and one of the reasons is we tend to think that our title informs how effective we will be in a time of crisis, and that's not often the case and in fact sometimes it's the people who are more quiet, who are more reserved, who are readily going about their work, uh, and who aren't the most boastful or or aggressive members of your community that are paying attention to what's going on in the world,

are paying attention to what's going on in their organization and it's that insight and that very quiet perspective that allows them to stand up in times of crisis. So the leader then needs to identify those people in the organization, and it's not always that people can hold a particular c suite title that are going to be the most effective. How about this wine? Sorry, Tim that's the brain. All of a sudden, like has kicked in. Um, women versus men?

Are there any qualities or any generalities that we can make that women being better in crisis management or men being better in crisis management? Yeah, well, recognizing that, to use your word, these are generalities, but one of the things that we observed in writing the prepared leader is because the focus in our book was using the pandemic as a thread throughout all different types of crises, what we saw was women who brought to the pandemic a

humanity and a recognition. Yes, there were health related issues that needed to be addressed, but there were also a level of emotional issues and interpersonal, dynamic issues that were part of this crisis that women brought to the forefront and surfaced in a ways, in a way that many

people seem to appreciate. So that's not to say that men can't or didn't do that, but generally some of the characteristics that typically describe women and women's leadership found value in this particular crisis, which I think informs how we should think about the needs that are necessary for

for leaders going forward. Before we let you go, just what's one leadership lesson you can leave with our listeners and our viewers at the end of the day here, I think the most important thing is to remember that people are the are at the heart of what you're doing. You're running a company which is not just the brick

and mortar. It is actually the people you are working for, people your your your shareholders, your customer Mers, your clients, and understanding what it is they need and being responsive to those needs is really, really critical, and sometimes it's very easy to get sidetracked by other things that are actually less, less Germane, but may sort of capture your attention and we lose side of the fact that we need to be responsive to the people in our organizations,

both our employees and our customers. Some great advice to wrap up on this Wednesday. Hey, Erica. Thank you so much, Erica. James Diana the Morton School at the University of Pennsylvania. Check out her new book written with Lynn Perry Wooten. The prepared leader emerged from any crisis more resilient than before. It's basically like learned from the crisis. Yeah, it's cool, but you know, she's also she's a professor, but she's also a board member. She's on Morgan Stanley's board. She's

on Morgan, she's on survey monkey's board too. So she's got a lot of practical experience as well, privy to a lot of probably interesting conversations in times of real stress Um. That will do it for the this fed Wednesday for Tim Stanovic and the Hol Bloomberg Business Week team of a good and safe evening. This is Bloomberg Radio