LEADING THROUGH A PANDEMIC

We learn about leaders on a consistent basis. Whether it is by reading history books about infamous tyrants who rose to the top through deceit and treachery, or by skimming the headlines of the newspaper about how Elon Musk has successfully managed to establish 10 companies and on top of that send a Tesla orbiting around the earth’s atmosphere. By the pure nature of how our brain works, our system 1 part of the brain immediately paints the picture that the former, the infamous tyrants, were bad leaders, whilst the latter, Elon Musk, is an example of a good leader. Leaders in today’s day and age are not categorized by how many innocent lives they have taken or spared or how many temples they have built on the backs of slave labor. In today’s society effective leadership qualities are much more subtle and nuanced.  It is difficult to say whether effective leadership can be measured by how many people the leader has been able to pull out of poverty by providing jobs, by how much money was donated to charitable events, or perhaps by the consequences of new inventions?

  The one thing in common for the questions above is that they are rooted in a subjective perception of what people expect good and effective leaders to be, however, there are theories which can serve as a predictor of how a specific individual would perform as a leader. Many of the traits which are sought after in a leader are predominantly genetic, but nurture and environment still play a vital role in personality development (Passer & Smith, 2009. p.72-73). An important distinction to make is that even though an individual is predisposed to being a leader, it does not necessarily correspond to them being one (Passer & Smith, 2009. p.71; Bouchard et al., 1990; Plomin et al., 2007).

  Due to the current world situation with COVID-19 being an imminent threat to mainly S&M businesses, as most of them cannot afford to shut down completely for a given period of time, most activities have been adjusted to remote work wherever possible. This brings forth a new era where physical presence is no longer required. An era in which the boss looks down to check up on his workers on the factory floor, he or she just sees machines. Research shows that the paradigm shift the world is going through, along side the pandemic, was imminent and that robotic advancement and AI are set to displace common jobs in the near future (Smith, A., & Anderson, J., 2010). This technological advancement will not only change the types of jobs which will be available, but it will also force organizations to change in order to meet strategic flexibility and gain competitive advantage (Hitt, Keats & DeMarie, 1998). Human capital has become organizations’ main weapon to gain advantages and avoid bankruptcy, and thus having respected individuals fill the role of leadership is crucial (Manz & Sims, 2001; Weldy, 2009). Regardless of how quickly well-known, established organizations transition from being traditional hierarchic and bureaucratic to being more flexible, decentralized and horizontal in structure in order to deploy the untapped creative potential in employees, leaders still play a central role in any organization (Konradt, Andreßen & Ellwart, 2008; Wagner, 1995; Weldy, 2009). As COVID-19 came and changed business almost over-night, it shook the world.

  However, even in the midst of a crisis where the work we have and jobs we do have been altered, life must go on. So, too, must business with leaders at the front. Although leaders have an arsenal of strategies, judgment and reason to choose from to help employees and businesses to  cope with the changes that came with the pandemic, what if conditions have been altered to the extent where previously negotiated contracts and agreements are now proving to be questionable and the consequences catastrophic?

  That is why the following issues will be addressed in this article:

How can leaders lead through a pandemic using negotiation to preserve business and lead others even in times where physical contact is limited?

A brief overview over central terms and theories

  There has been a boom in understanding leadership and what goes into the term over the past few decades. The term has quickly become one of the most discussed and researched topics in the field of organizational behavior (McShane & Von Glinow, p.336). There are approximately 2.7 billion results where leadership is a keyword on Google alone. Google scholar, a search engine for academia, returns a whopping 4.4 million results for the same keyword. In other words, there is an ocean of different interpretations of what leadership is. However, the fine part about psychology – and moreover the psychology of persuasion – is that it is cross cultural and universal. In negotiating settings, the wiring of human beings is what is on the other side, and thus there are a few general rules that apply regardless of race, gender, ethnicity or religion. Due to the nature of the research question, there are primarily three topics that need elaborating. These are leader and leadership, negotiation, and the impact lack of physical contact has on an organization; its employees, leaders, and culture.  

  Discussing leader and leadership throughout history has been turbulent and it has been hard to draw lines between personality and behavior. There have been popular beliefs that great leaders were born and not socially constructed, as pointed out by Thomas Carlyle in his Great man theory (Helen L. Eckmann, 2005, Thomas Carlyle), however, the past few decades a new paradigm shift, where the five-factor model made its name in the research field of trait theory, observations of personality traits present across effective leaders have been made (Goldberg LR (January 1993)). As there are many different ways to describe human behavior, the model boils it down to essentially five broad terms in which they can describe the most salient aspects of personality (Personality and leadership, Goldberg (1990)).

  As mentioned, negotiation tactics and strategies leaders can choose from are applicable to most situations and humans. The only twist to the tale now is that we find ourselves in a time and place where negotiating losses will be at the table, and not new gains. For this, Kahneman and Tversky have done lifelong research on human behavior and which heuristics human beings tend to make, albeit irrational, to distance themselves from risk. Two of them, which are of high relevance when negotiating, are prospect theory and anchoring. Using the model of prospect theory to understand underlying human behavior when it comes to gains vs. losses, as well as anchoring properly to leave the opposition with a perception of reduced losses can be detrimental when leaders enter the table to handle lost business as a consequence of the pandemic (Passer & Smith, 2009), Kahneman, D., & Tversky, A. (1979) p.263-291; Dr. Sivanathan, 2020).

  Lack of physical contact in a workspace was unheard of before the internet blossomed. The internet has allowed us to be apart but still connected, and many digital companies encourage remote work. However, for the majority of organizations and businesses, COVID-19 imposed instant changes. This radical transformation of organizational structure has been proven difficult, not only in terms of business but also for employees. Employees, who are used to seeing their colleagues in a shared and safe environment, no longer can. Many businesses have had and will be forced to change their goals and vision to adjust to the pandemic. Leaders are able to help make this transition as pain free as possible by altering the existing culture to align with the new goals and vision set by the organization.

The importance of establishing a connection

  Defining what a good leader is may be difficult due to the subjectivity in what makes a person good in another person’s opinion. As mentioned, the concept of “leadership” is often vaguely described among the number of authors who have penned it down (Hassan, Asad & Yasuo, 2016), and thus several types of leaderships have been defined. Gary Yukl defines leadership as “the process of influencing others to understand and agree about what needs to be done and how to do it, and the process of facilitating individual and collective efforts to accomplish shared objectives.” In simpler terms, leadership concerns the ability to influence a group towards the achievement of goals. If the leader fails to reach these goals, there should be consequences. This makes the leadership role meaningful in the pursuit of reaching given metrics (Bang & Eidsbø Lindholm, p.19).  

  Organizations and corporations today are often multicultural and multinational, meaning that the employees of a given firm come from and/or live in different cultures, countries, backgrounds, and have different motivations as to why they are doing what they do. A difficult accomplishment for any organization is to get their employees onboard with the company’s vision. For any firm, there is great importance in coordinating their employers’ efforts and acts in order to achieve organizational objectives. The dynamic dance between coordinating and cooperating is an ongoing process within an organization, and a vital part of that process is to change a set of beliefs, attitudes and behaviors in ourselves, as well as motivate and encourage others to do the same. For this to happen effectively, having the skill to influence is central and sought after in leaders. In the field of organizational behavior, researchers have devoted their attention to sort an array of different influence tactics commonly found in businesses, organizations and corporations into a system (McShane & Von Glinow, p.290-292).

Although a definitive list is not agreed upon, one can divide the difference types of influence tactics in “hard” and “soft” tactics. Hard tactics include assertiveness, information control and upward appeal. They force behavior change through position power. Soft tactics, on the other hand, rely more on personal sources of power and include impression management, persuasion, and exchange (McShane & Von Glinow, p.298-299).

  The use of these tactics does not only vary in different situations, different leadership styles or personal traits, they also vary between genders. Past research on psychological gender differences indicates that women use communication as a tool to strengthen social connections and create relationships, whilst men use language to exert dominance to achieve tangible outcomes (Leaper, 1991; Maltz & Borker, 1982; Wood, 1996; Mason, 1994). In other words, men usually lean more towards hard tactics whilst women tend to go to with soft tactics. Researchers have suggested that the differences in communication styles put men at an advantage when interacting with others, as men speak less tentatively and more assertively, leaving the impression of being confident and capable as leaders (Lakoff, 1975).

The positive news, as more women are becoming leaders, is that the art of negotiating and influencing can be practiced, learned and deployed to even out the score between the genders (Merchant, 2012).  

  Influence – the psychology of persuasion - is linked with interaction and establishing rapport through psychological closeness to others. One could argue that it is hard to form a connection when you cannot even shake hands with the opposing party in times of COVID-19. Emotional contagion might be diluted through the pixels on the screen, and bonding – which develops through each person’s awareness of a collective sentiment – might become problematic when staff and leaders fail to meet regularly (McShane & Von Glinow, p.256-257).

  When choosing a communication channel, there are primarily four factors one should consider: Synchronicity, social presence, social acceptance, and media richness. The four factors depend on which objective one has (McShane & Von Glinow, p.257). However, the channels that are best suited for influencing others is social presence along with synchronicity. A communication channel, such as face-to-face interactions, has the highest social presence and media richness. Face-to-face interactions are also synchronous, as both sender and receiver are actively involved in the conversation at the same time. Creating closeness and awareness to others becomes more efficient when communication is instant, and thus trust is more easily established. Although face-to-face can be simulated through cameras, a vital component which is harder to pick up on through virtual contact is nonverbal communication, i.e. body language. Frank Lowky, the cofounder of Westfield Group sums it up by saying that telephones are “too cold” for negotiating. “From a voice I don’t get all the cues I need. I go by touch and feel and I need to see the other person.” (McShane & Von Glinow, p.324).

   F. Lowky’s statement stems from the fact that most information is communicated nonverbally. The information and messages we send to the receiver are subconscious. Nonverbal communication is of great importance when negotiating because body language is universal and hardwired across cultures (McShane & Von Glinow, p.255). Through poor connectivity, input lag or bad image quality, the natural flow of negotiation gets distorted, and these subtle ques of facial expressions and other indicators – which for negotiators can be detrimental to overall success – can be left unseen. By eliminating or limiting either vocal or visual cues and synchronicity in negotiations, the chances of an efficient outcome drops substantially (Swaab, Medvec & Diermeier, 2006).

  Body language is of greater importance during difficult times, as negotiating tends to become emotional. Emotional negotiation (i.e. irrational) is often unwanted and business leaders should guard against it. One should rather transmit neurological telepathy to enforce a sense of calmness and stability to enhance rationality. This is because negative emotions generally have negative consequences for negotiations due to the tendency to make systematic errors when processing information. Furthermore, humans tend to label others by their behavior, which can reflect negatively in negotiations if the prospector is under impact of negative emotions (Dr. Sivanathan,2020; Ross, 1977).

  Human beings are not perfectly rational (McShane & Von Glinow, p.184). Especially not in times when one is negotiating losses – a treacherous territory leaders find themselves in during the current situation. As pointed out by Dr Sivanathan, professor at London Business School, the impact of COVID-19 has and will continue to affect existing deals, transportation, shipping and supply chains. In other words, the external environment is causing conflict on business level (McShane & Von Glinow, p.304). Business leaders now find themselves in dispute with not only customers but also employees, and this has a profound effect on human behavior where we tend to deviate from rationality (Dr. Sivanathan, 2020). Daniel Kahneman and Amos Tversky systematically uncovered, throughout most of their career life, the ways humans perceive loss and gain. This is known as the prospect theory (Passer & Smith, 2009; Kahneman, D., & Tversky, A. (1979) p.263-291).

  The prospect theory, in its essence, proves that the utility one draws from making gains is disproportionate to the disutility one draws from making losses. According to Dr. Sivanathan, some studies show a 2:1 ratio in the amount of disutility humans experience with losses compared to gains. This phenomenon is also commonly observed in game theory, where players gravitate towards the lesser equilibrium due to the pain associated with (potential) loss (Nax, 2015).  Another observation made by Kahneman and Tversky in the prospect theory was that in negotiations, outcomes are evaluated, compared and coded relative to reference points. In most negotiations there are counteroffers following an initial offer. Kahneman (1992) suggests that an anchoring-and-adjustment process should be initialized when negotiating, so the initial offer (anchor) serves as a reference point for adjustments and counteroffers (The Effects of Anchor Points and Reference Points on Negotiation Processes and Outcomes, (Kahneman, 1992; Neale & Bazerman, 1991)).  

  For a business leader who is facing an uphill battle negotiating losses, it is significant to understand the circumstances before entering a negotiation, be it with business partners or employees. Using a communication channel with high social presence and synchronicity, along with understanding and managing the underlying emotions times of recession bring with them, can be detrimental factors when leaders discuss and negotiate contracts, offers and projects. However, it is important to remember that the power of influence and art of negotiating for leaders go far beyond just sealing a deal. It also serves as a fundamental function in inspiring and motivating employees, allocating resources where they see best fit and enabling others to contribute toward the success and effectiveness of the organizations of which they are members  (McShane & Von Glinow, p.336). So, who makes for a good leader?

Personality traits of a leader

  There is a myriad of different personality traits which have been described over the years.

These are traits such as: curious, suspicious, talkative, anxious, and sociable. By organizing these traits into smaller clusters, experts believe they have been able to pull the fundamentals out of approximately 17,000 words which can describe an individual’s personality, and have created a model which boils down to five broad personality dimensions. The result, which to this day is the most respected and researched model, is the five-factor (Big Five) model (FFM). This model describes how five major personality traits are linked and highly correlated to leadership (Northouse, 2007, p.22; McShane & Von Glinow), and is often used to define human personality at the highest level of organization. The big five personality traits are: openness to experience, conscientiousness, extroversion, agreeableness and neuroticism (Goldberg, 1993). Depending on an individual’s composition of these traits, one can get a general understanding on how they will perform on certain tasks and positions (McShane & Von Glinow, p.41). For leaders who play a role where negotiating is of importance, traits such as extroversion, which is characterized as having more social relationships, greater social support and more positive emotions are beneficial (Passer & Smith, 2009; p.87, Nettle (2006)). Along with extroversion, conscientiousness is seen as the strongest predictor of great leaders (McShane & Von Glinow, p.351). Other traits of importance are agreeableness and neuroticism, where women tend to score higher, but lower scores tend to be preferable in business settings (Personality and Individual Differences, 2007). However, being more agreeable has its advantages as it establishes trust (McShane & Von Glinow, p.39), and people do business with people they trust. Establishing trust is also highly linked with the ability to lead (McShane & Von Glinow, p.341). There is also an array of different traits which go beyond the scope of FFM which have been studies and can serve as attributes of effective leaders, however, they tend to be vaguely defined and/or can be sorted within the five terms in the FFM model. Examples would be Gary Yukl’s (1998) theories of effective leadership where he points out that high energy (read: extroversion) and high tolerance of stress (read: neuroticism) are properties effective leaders possess (Bang & Eidsbø Lindholm, p.20).

  Knowing how well you score on the different traits showcased in the FFM model can be beneficial to not only aspiring leaders, but also employees. As stated earlier, women tend to score higher on agreeableness. Jordan Peterson, a clinical psychiatrist, has pointed out in numerous interviews that his female clients have been able to get a substantial raise in salary by simply being less agreeable in negotiations (Z. Williams, The Guardian, J. Peterson, 2020). In a leadership setting, this can equal to more profit for your organization when negotiating new deals.

  For leaders, knowing where your personality tends to gravitate in the FFM can expose weaknesses and strengths about one’s personality relative to a specific job. For instance, if a leader scores low on conscientiousness, it might make the individual react proactively by ordering tasks to initiate structure, which is a trait found in effective leadership (Bang & Eidsbø; Lindholm). Although leaders have a central role of negotiating and exploring new business opportunities, they may also have a managerial and/or transformational role in an organization (McShane & Von Glinow, p.337)

Reaching goals through shaping culture

  A central role a leader within an organization is to help shape the culture to align with the company’s vision (McShane & Von Glinow, p.334). A vision can be defined by a challenging, distant and abstract goal and in order to reach these goals, motivation, meaning through stories, empowerment and other vehicles that transcend plain language need to be used by leaders (Organizational Behavior, p.339). For employees to buy into the abstract concept of “vision”, surveys have reported that one of the most important characteristics a leader can have is being consistent between the leader’s words and actions. They walk the talk. In other words, employees value their leaders being orderly and dutiful (read: conscientious). Furthermore, some experts believe that charisma (read: extroversion) plays a central part in a leadership role, however, charisma is not seen as inherently good nor bad. Inevitably what leaders want to accomplish is altering existing behaviors and beliefs within an organization to better align with the company’s future goals and visions through influence and persuasion (McShane & Von Glinow, p.340-343). Times like these, with COVID-19, impose a double-edged sword. On one side, the lack of physical presence of leaders, and as Jungian analyst Robert Moore would put it; king-energy (Moore & Gillette, 1991), can take away employees’ confidence in the work that they do if the employees’ lack psychological and work-related maturity. On the other hand, working remotely enforces full transparency, and real-time feedback can make employees work more effectively, a phenomenon referred to as the Hawthorne effect (Wickström & Bendix, 2000). It all depends on the individual. For the former, having a leader who is more supportive during the times of a pandemic can be beneficial, and for the latter, task oriented work is preferred (Bang & Eidsbø Lindholm, Hersey & Blanchard, 1982, p.151).

  A challenging but effective way of transforming an organization is by altering the culture, and this change often comes with replacing leaders. As pointed out, there should be consequences connected to leadership. Leaders are especially powerful when it comes to changing an organization’s culture as leaders provide a compelling role for employees to follow (McShane & Von Glinow, p.401), creating a form of guruism. An important observation to make is that culture is embedded in the mind of the organization’s employees, and thus employees play a fundamental role in shaping and maintaining culture. Leaders, when wanting to steer the culture in a certain direction, should prioritize hiring new employees who have values which are compatible with the culture and/or cultural changes the company is undergoing. This process is more commonly known as the attraction-selection-attrition (ASA) theory. In its essence the theory states that organizations have a natural tendency to attract, select and hold on to people with personality characteristics and values that are in line with the organization’s character, resulting in a stronger culture as the organization becomes more homogeneous. In today’s digital world, corporations such as GAFA (Google, Amazon, Facebook, Apple) use thorough selection processes when deciding to hire. This holds true for other S&M companies as well. The selection procedures often include behavioral and personality tests to make sure the candidate is fit for the job in a holistic way and not only in terms of their skills ((McShane & Von Glinow, p.403; Myrvang, 2020).  

  Additionally, the power of language has a profound effect on culture. An example would be framing a situation or problem optimally as opposed to sub optimally (McShane & Von Glinow, p.311). In the instance of a leader trying to shape a culture of self-motivated individuals, naming them “journey travelers” as opposed to “employees” when posting job advertisements, frames the candidates in a positive light as opposed to negative, and this can enforce a set of behaviors that are wanted from the leader. This effect is called the framing effect and was first researched by Amos Tversky and Daniel Kahneman (1979). It demonstrates that individual decisions are systematically affected by the way in which questions or requests are presented (Max H. Bazerman, 1984). By framing a specific task, offer, request or mission positively, the frequency of the asked participants to choose the positive frame as opposed to the negative is substantially higher (Tversky & Kahneman, 1981). For a leader in search of new employees, this can mean a greater pool of candidates to choose from.

  For a leader seeking to keep and/or alter an organization’s culture during times of limited physical contact, it is important to remember that although culture is concrete in the form of artifacts and symbols, it predominantly exists in the mind’s of employees. By reminding them of the company’s vision and, as a leader, deploying words into action, it can have a ssourgnificant impact on employees by ensuring them that they have a leader to follow during a pandemic – a lead which is aligned with wanted culture and vision.  

Conclusion

During times of recession it is important to minimize the damage done to business and the people involved in business. As a leader one should be aware of the emotional stressors and consequences hard times bring with them in order to have strategic business leverage when entering tough negotiations. If a business loses all or most of its clients, contracts and enquiries, the ultimate consequence will be downsizing. This is not a pleasant situation to find oneself in, be it as a leader or an employee. A leader should therefore not neglect the importance of minimizing the economic losses during COVID-19. Leaders should rather do their best to stay calm and not let their emotions get the better of them (read: neuroticism) in order to increase the likelihood of having a desirable outcome. By understanding human behavior and how it tends to deviate from rationality due to humans’ innate way of processing information quickly (read: system 1), it can save organizations business. These are just of a few of the many challenges leaders face on a daily basis and in times of greater stress and crisis, in particular. Times like this global pandemic ultimately serve to separate the chaff from the wheat. Truly strong leaders will not only survive such times, but may even thrive. Though chaos often presents great danger, it also presents great opportunity for leaders with the right mindset and practical skills to take advantage of it. The strongest organizations have the strongest leaders, and these can now adapt to the changing market situation by filling niches and supply shortages which are not present when the market is stable. In short, those leaders who have understood and integrated the principles described in this paper are now in a position to overcome the challenge and achieve personal and organizational success. Those who have not may take this event as an opportunity to learn and improve their leadership skills for the next chaotic upheaval. As the old saying goes, knowledge is power, and everyone reading this paper can at least take away one simple lesson. The best leaders arm themselves with the best knowledge and always stand ready to face the unknown. The future belongs to those who prepare for it today.