Systems Leadership and How to Master the Cross-Pressures That Make or Break Today's Companies

Since the start of this century, businesses have confronted a host of extreme disruptions and transitions, including technological upheavals, economic instability, geopolitical conflicts and wars, a worldwide pandemic, a global financial crisis, the increasing rise of activist investors, and fundamental changes in the socioeconomic structure of society. While business leaders in every era of modern history have faced disruptions, we’ve never before seen such a constant, unrelenting, and diverse blend of them.

Today’s leaders at all levels, from new startups to global giants, face cross-pressures from their bosses, investors, customers, peers, suppliers, and employees that their predecessors never did. And these stakeholders are sometimes far from aligned. Leaders face pressure to do opposing things at the same time, which can make them feel like no matter what they do or how well they do it, they are getting it all wrong. And these cross-pressures, while acutely felt, are rarely articulated in a way that makes them graspable and actionable.

Business leaders need to understand and balance the needs of internal and external stakeholders. They need to excel at short-term execution and long-term innovation. They need to hold employees accountable while treating them with respect and empathy. They must personify ambition and stewardship. And they need to balance these dualities as individuals — not just in their organizations.

To address this, I’ve spent the last eight years developing a new leadership framework with Jeff Immelt, the former CEO of General Electric. We call it Systems Leadership, and we’ve taught this in a course at Stanford since 2017.?

Systems Leadership is the ability to master processes and strategies from different perspectives at the same time: physical and digital, breadth of market and depth of market, short term and long term, what’s good for the company and what’s good for its ecosystem. Systems Leaders combine the IQ to understand their company’s technology and business model with the EQ to build effective teams and inspire them to new heights. They use short-term execution skills to hit their financial targets this year, while also driving changes that may not pay off for five or more years. They grasp the big picture and essential details simultaneously. They understand how all the elements of an organization affect both internal and external stakeholders, and how interactions internally and externally shape a company’s outcomes.

Systems Leadership begins with embracing how much you don’t know at any given moment, and moving forward with reasonable confidence but not delusional overconfidence. It’s not possible for anyone to be omniscient or memorize every detail of every aspect of their business. Systems Leaders, however, learn enough to have meaningful conversations with experts of all stripes. They learn how to ask the right questions, not necessarily how to answer all of them. Then they evaluate how the perspectives of those experts fit into the bigger picture of the company’s strategic priorities, as well as those of its ecosystem partners. Then, finally, they muster the self-confidence and courage to make decisions under extreme uncertainty.?

The name Systems Leadership is a play on “systems thinking,” a phrase often used by technologists, made popular by Peter Senge in his book The Fifth Discipline. In it, Senge stresses the interplay of actions and reactions between components of any kind of system, and the importance of studying those relationships holistically, not as isolated parts.?

Building on this, Jeff and I approached leadership not as a collection of discrete skills that one could learn in separate courses (finance, marketing, operations, and so on), but as a holistic, interdisciplinary path to figuring out the right things to do and then consistently accomplishing those goals.?

The goal is to give leaders a new language to discuss their biggest pain points and toughest trade-offs, and to show them how to address the cross-pressures they feel, instead of trying to wish away, steamroll, or run from them. Systems Leadership empowers leaders to be proactive instead of reactive, and it offers them a playbook for riding turbulent waves without drowning. In short, it takes leaders from chaos to clarity.

The gist of Systems Leadership is reframing and learning how to master five key dimensions of cross-pressures that I’ve gleaned from years of studying and interviewing leaders. These pressures, of course, don’t exist in silos. I believe the interdependence of these cross-pressures is a major reason why they feel so frustrating and complex. These dimensions are:

1. Priorities: The need to succeed at both execution and innovation.
2. People: The need to project both strength and empathy.
3. Sphere of Influence: The need to focus both internally and externally.
4. Geography: The need to think both locally and globally.
5. Purpose: The need to pursue both ambition and statesmanship.

Now, balancing these cross-pressures isn’t easy. But Systems Leadership is hard in the same sense that running a marathon, playing guitar, doing calculus, or driving on a highway are hard. For all of those competencies, the baseline of required innate talents isn’t very rare. The key is putting in consistent effort over time to learn and then master the necessary skills. It’s about practice much more than talent.

Over the coming weeks and months I’ll share more about what we’ve learned by studying some of the most compelling leaders we know from all over the world. These people come from both large and small companies. Some of them have achieved great success and some have struggled. But each has taught us lessons from which we can all learn.

Robert

About The Systems Leader:

A groundbreaking blueprint for mastering “cross-pressures” in a rapidly changing world, teaching leaders to execute?and?innovate, think locally?and?globally, and project ambition and?statesmanship alike—from a Stanford Graduate School of Business lecturer and consultant to some of the biggest and most innovative CEOs.

Actionable and powerful,?The Systems Leader?is a playbook for riding turbulent waves instead of drowning in them—and for taking readers from chaos to clarity.

About Robert:

Robert Siegel is a Lecturer in Management at the Stanford Graduate School of Business, a venture investor, and an operator.

At the Stanford Graduate School of Business he has taught nine different courses, authored over 115 business cases, and led research on companies including Google, Charles Schwab, Daimler, AB InBev, Box, Stripe, Target, AngelList, 23andMe, Majid Al Futtaim, Tableau, PayPal, Medium, Autodesk, Minted, Axel Springer and Michelin, amongst others.

Robert is a Venture Partner at Piva and a General Partner at XSeed Capital. He sits on the Board of Directors of Avochato and FindMine, and led investments in Zooz (acquired by PayU of Naspers), Hive, Lex Machina (acquired by LexisNexis of RELX Group?), CirroSecure (acquired by Palo Alto Networks), Nova Credit, The League (acquired by Match Group), Teapot (acquired by Stripe), Pixlee (acquired by Emplifi), and SIPX (acquired by ProQuest).

He is the author of The Systems Leader: Mastering the Cross-Pressures That Make or Break Today's Companies, and The Brains and Brawn Company: How Leading Organizations Blend the Best of Digital and Physical.?

He is the co-inventor of four patents and served as lead researcher for Andy Grove’s best-selling book, Only the Paranoid Survive.

Robert holds a BA from UC Berkeley and an MBA from Stanford University. He is married with three grown children.