Growth economies are making a proverbial splash on the business world and the ripple effect will leave no organization untouched. While conventional business philosophies will help some leaders navigate the rough waters, truly succeeding in this rapidly changing landscape, goes far beyond any business school curriculum.
Whether you’re a leader of a startup or a Fortune 500 company, we are all grappling with rapid and borderless news cycles, accelerating urbanization, new technologies, the creation of global marketplaces, and an abundance of cheap capital. In the midst of it all, we are working to solve the same core problem: how can we be relevant in a fast-paced world?
Some will turn to business school principles for the answers, but finding solutions for this deep-seated question goes beyond a change in operations, technology adoption and business structure. It requires a less tangible solution. Leaders and companies seeking to be relevant must adopt a growth mindset and culture—the foresight, courage and ingenuity to identify and take hold of novel opportunities and do it sustainably.
The Western powerhouses that have historically dominated the world economy are “passing the baton” of global economic leadership to the growth economies of Asia, the Middle East, Africa, and Latin America. These economies are turning the business world on its head. It’s phenomenal to consider these regions have contributed more than 80 percent1 of global economic growth since the 2008 financial crisis. By 2050, they will dominate the world’s top 10 economies2.
In addition to where the world is doing business, we’re experiencing major shifts in how business is done. Digital, mobile and social media are transforming the customer experience, disrupting industries and businesses and creating new ones, and workforce skills and demographics need to change in tandem. The growth of mobile technology and solutions in Asia and Africa alone is staggering. It is fundamentally changing not just payments but whole systems of social and business interaction.
The bottom line is the world is changing. Fast. Leaders with a growth mindset want to amplify strategic choices and fuel innovation. They know with a clear purpose and by keeping people at the core, they can use the external environment to their advantage. Leaders inspired by unleashed potential, new terrain and competitive possibilities, and who are undeterred by the challenges that accompany it, will be the ones who succeed.
At its core, a growth mindset is a deeply engrained belief that influences how decisions are made. Those with a growth mindset feel emboldened by challenges; they perceive them as opportunities to expand their point of view, learn something new, and better themselves from the experience. And by doing so, they find profitable business growth in even the most difficult environments.
On the contrary, those lacking this mindset are threatened and paralyzed by uncertainty. Take for example, Carol Dweck’s case study of fixed mindset CEOs in Mindset: The New Psychology of Success. In the book, she explains how the fixed mindset helps us understand where egos come from and why they become self-defeating. Referencing fixed mindset CEOs, Dweck says they start believing some people are superior, and have a need to prove and display their superiority by using their subordinates to feed this need, rather than fostering the development of their workers3. By not embracing diversity of thinking or inviting controversial views, in the end, fixed mindset leaders have sacrificed the long term success of their companies or worse, drove them to extinction.
In order to incite meaningful change and remain competitive on the expanding global stage, successful leaders do not fall victim to a finite mindset. They must continue to seek alpha, agitate for growth and have a bias toward relentless execution.
Really successful leaders say it takes ‘1,000 good decisions’. What this refers to is the cumulative effect over time of out-competing the opposition making the highest quality decision at every turn. An open growth mindset applied consistently across a business portfolio and sustainably over time, will lead to exponential growth. Like the power of compound interest, growth decision on growth decision on growth decision and so on, across an organization, will lead to accelerating competitive advantage.
Though the concept of a growth mindset is simple in nature, fostering this mentality consistently among employees is a challenge. Mercer research conducted among 800 organizations, across 57 countries and 26 industries, found only two in five employees say their company has a compelling, differentiated value proposition. Based on this research, Mercer developed the Thrive Model: How to Win in an Age of Disruption. This model emphasizes that in changing times, organizations need to develop a ‘growth-focused’ culture or growth mindset – empower their employees, focus on inclusiveness, connectedness, and innovation4.
For leaders, advancing and nurturing this perspective must be a priority. Studies indicate employees in a growth mindset culture expressed 47 percent more trust in their company than those in fixed mindset companies; are 34 percent more likely to feel a sense of ownership and commitment to the future of their company; are 65 percent more in agreement that their companies support risk taking; and are 49 percent more in agreement that their companies foster innovation5.
Developing a growth mindset and culture starts with talking about it. Passion is contagious. Great leaders inspire others by sharing their visions. Through a compelling storytelling approach, leaders can provoke change not by executive order, but by standing for something bigger, going beyond the profit narratives and articulating the why. As Simon Sinek said, “If you talk about what you believe, you will attract people who believe what you believe.”
The potential inherent in being relevant to our changing world is extraordinary. Growth economies account for 90 percent of the global population under the age of 306, which means 85 percent of the global work-age population will be in growth economies by 20307. It’s no wonder growth economy multinationals on the Global Fortune 500 list increased by 240 percent between 2005 and 20138; or that these markets are set to account for nearly 60 percent of the world’s GDP by 20309.
Having a growth mindset opens doors to opportunities in existing markets and to many new frontiers. Companies, and leaders, who anticipate and meet market needs in the rapidly growing corners of the world will reach and inspire many more people. They will demonstrate their value—not just at home, but across the globe.
To quote Rwandan author Bangambiki Habyarimana, “Break to pieces whatever indoctrination and programming that holds you hostage. The world is yours. Get possession of it.” Today’s business leaders have the opportunity to create a future that was previously inconceivable. As technology and globalization dissolve the boundaries between us, we must also dissolve the boundaries of our own thinking. The time for a growth mindset and culture is now.
Sources:
1 International Monetary Fund. (2016, February 04). The Role of Emerging Markets in a New Global Partnership for Growth by IMF Managing Director Christine Lagarde.
https://www.imf.org/en/News/Articles/2015/09/28/04/53/sp020416#P27_3292
2 PWC. (2015). The World in 2050 Will the shift in global economic power continue?.
https://www.pwc.com/gx/en/issues/the-economy/assets/world-in-2050-february-2015.pdf
3 Dweck, Carol S. Mindset: The New Psychology of Success. New York: Ballantine Books, 2007. Print.
4 Mercer. (2017). Thrive Model: How to Win in an Age of Disruption.
https://www.mercersignatureevents.com/ASIAHR2017/hongkong/agenda.html
5 Senn Delaney. (2014). New Study Findings, Why Fostering a Growth Mindset in Organizations Matters
http://knowledge.senndelaney.com/docs/thought_papers/pdf/stanford_agilitystudy_hart.pdf
6 Euromonitor International. (2014, May 30). Emerging Markets Account for 90% of the Global Population Aged Under 30.
http://blog.euromonitor.com/2014/05/emergingmarkets-account-for-90-of-the-global-population-aged-under-30.html
7 Lam, David. (2014). The Demography of the Labor Force in Emerging Markets.
https://www.kansascityfed.org/publicat/sympos/2014/2014Lam.pdf
8 GE Reports. (2014, June 20). The Rise of Emerging Market Startups.
https://www.ge.com/reports/post/93343731983/the-rise-of-emerging-market-startups/
9 OECD. (2010, May 26) Economy: Developing countries set to account for nearly 60% of world GDP by 2030, according to new estimates.
http://www.oecd.org/dev/pgd/economydevelopingcountriessettoaccountfornearly60ofworldgdpby2030accordingtonewestimates.html
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