How Leadership Style Can Be an Asset (or Liability) in a VUCA World

Leaders today face a barrage of challenges: geopolitical instability, tariff wars, climate change, pandemics, inflation, and supply chain disruptions. These VUCA (Volatile, Uncertain, Complex, Ambiguous) conditions can leave anyone feeling overwhelmed. But there’s one critical tool that leaders can control and leverage for success: their leadership style. Surprisingly, this resource is both free and entirely within their grasp.

The 2010 book Multipliers by Liz Wiseman comes to mind. It outlines how certain leadership approaches can amplify a team’s intelligence and capability, while others diminish it. In a VUCA world, your leadership style can be the differentiator between thriving and barely surviving.

Boosting Employee Engagement: The Critical Role of Leadership

Employee engagement—the extent to which employees are emotionally and intellectually committed to their work—is a powerful lever for organizational resilience. Highly engaged employees are less likely to feel stress and more likely to thrive both at work and in life. Yet only 23% of employees globally are engaged.

A leader’s style directly influences engagement. Research shows that managers account for 70% of the variance in team engagement. Engaged managers foster cultures where employees feel valued, empowered, and inspired to contribute their best.

The Significant Costs of Disengagement

Disengagement isn’t just a cultural issue; it’s a financial one. Low employee engagement costs organizations millions annually. Using Shelley Smith’s Engagement ROI Calculator, let’s consider the example of a 50-employee company with an average annual salary of $65,000. If just 20% of employees are disengaged, the cost of lost productivity, turnover, and absenteeism can exceed $575,000 per year. This staggering figure illustrates how disengagement eats away at profitability and growth.

Leadership: The Multiplier Effect

Liz Wiseman’s research distinguishes between two types of leaders: “Multipliers” and “Diminishers.” Multipliers unlock the full potential of their teams, fostering cultures of innovation and collaboration. They see intelligence as something that grows when shared and intentionally build environments that amplify everyone’s contributions. Conversely, Diminishers hoard control, stifling creativity and leaving talent underutilized.

Take K.R. Sridhar, CEO of Bloom Energy, as an example. When a star scientist issued an ultimatum, Sridhar prioritized team collaboration over individual ego. The result? The team rallied, hit their targets, and demonstrated that shared intelligence trumps individual brilliance.

Key Differences: Multipliers vs. Diminishers

Multipliers:

• Talent Magnets: Attract and fully utilize diverse talents.
• Liberators: Create safe spaces for bold thinking and risk-taking.
• Challengers: Push teams to stretch beyond their comfort zones.
• Debate Makers: Encourage rigorous, inclusive discussions.
• Investors: Delegate ownership and accountability.

Diminishers:

• Empire Builders: Hoard resources and underutilize talent.
• Tyrants: Suppress creativity through fear.
• Know-It-Alls: Dominate decisions without input.
• Micromanagers: Stifle autonomy by over-controlling processes.

Becoming a Multiplier: Practical Steps

To shift toward a multiplier mindset, leaders must:

1. Adopt a Growth Perspective: Assume that intelligence and capability can expand. Ask not “Is this person smart?” but “In what ways is this person smart?”
2. Foster Psychological Safety: Encourage risk-taking by creating a culture where mistakes are seen as learning opportunities.
3. Engage in Active Listening: Prioritize team members’ ideas over your own.
4. Delegate with Trust: Give others ownership of outcomes and avoid the temptation to micromanage.
5. Provide Constructive Challenges: Frame stretch goals that push teams to innovate and grow.

Over the years I've led teams with a wide variety of personality types and I know firsthand the benefits of this approach. In today’s increasingly polarized world, it’s easy to focus on our differences, but asking questions like “In what ways is this person smart?” helps us connect and bring out the best in our teams.

The Hexal AG Case Study

A powerful example of the multiplier mindset comes from Hexal AG, a Germany-based pharmaceutical company. There, leadership fostered a culture where roles weren’t rigidly defined, allowing talent to flow to the right opportunities. One customer service assistant identified inefficiencies in the workflow and took it upon herself to create a web-based tracking system. Her initiative streamlined processes across the team, saving time and reducing errors. By empowering employees to act on their insights, Hexal AG unlocked innovation that contributed to the company’s $7.6 billion valuation when it was sold to Novartis.

Quantifying the ROI of Employee Engagement

Investing in engagement delivers measurable returns. Highly engaged teams outperform others on key metrics:

• Profitability: Companies with engaged teams see 23% higher profitability.
• Productivity: Engaged employees are 18% more productive.
• Retention: Engaged employees are 43% less likely to leave.

Moreover, effective leadership reduces the costs of turnover and absenteeism. For instance, the cost of replacing a disengaged employee earning $65,000 can exceed $19,000 when factoring in recruitment, training, and lost productivity.

Measuring and Tracking Employee Engagement

To track engagement, consider tools like customized opinion surveys that assess factors like satisfaction, clarity of expectations, and perceptions of leadership. Collect data by department, location, or manager to identify pockets of disengagement and address root causes.

Conclusion

In a VUCA world, leaders can’t control external forces, but they can control how they lead. By adopting a multiplier mindset, fostering engagement, and prioritizing people over ego, leaders can transform uncertainty into opportunity. As Wiseman’s research reminds us, leadership style isn’t just a personal trait—it’s a strategic asset. Use it wisely, and your team will follow suit.

Let's Discuss

How have you seen leadership style impact engagement and productivity in your organization?

What do you think it takes to foster psychological safety and bring out the best in diverse teams?

Are you a “Multiplier,” or have you worked with one? What was that experience like?

I’d love to hear your thoughts and experiences—let’s start a conversation!

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