From my associate Janice Giannini.

When relative power gets in the way of collective strength

The United States faces many serious challenges. Artificial intelligence is changing business, work, and national security. Global competition continues to intensify. Our national debt constrains future choices. Demographic changes are reshaping the workforce. Geopolitical instability requires strong alliances, economic strength, and capable leadership.

These challenges will only intensify, not disappear. The question for all of us is: Are we positioning ourselves to meet them or getting in our own way?

One place to look is talent.  The issue applies to organizations of every size. In a small business, where every person may represent a larger share of the company’s capacity, the consequences of overlooking or underusing talent can be more immediate.  Specifically, are we finding, developing, and using as much of the capability available to us as possible? Or are assumptions about status, power, merit, and who belongs where driving us to sub-optimize?

In a world where our margin for error is getting shrinking, systematically leaving capability unused is itself a strategic choice, even when we don’t realize we are making it.

When Relative Power Gets in the Way

A recent Economist article explored how “male honor” can discourage women’s employment in parts of the world. The economics appear counterintuitive. A woman working can increase family income and contribute to economic growth. Yet in some cultures, her employment can reduce a man’s perceived status because his ability to support the family without her earnings helps define his role.

The family can become better off economically while he feels worse off relative to others. That distinction has implications far beyond gender.

Suppose one person has historically had access to 80 out of 100 opportunities, while another has had access to only 20. Over time, both gain access to all 100. Both are better off. However, the first person’s relative advantage has disappeared. We can gain in absolute terms and still experience change as a loss because someone else gained more.

How often do individuals, organizations, or societies resist change because a loss of relative advantage feels like an absolute loss?

Most people are not intentionally trying to hold others back. We operate from assumptions shaped by experience, culture, and environment. Some become so familiar that we stop recognizing them as assumptions.

The problem comes when protecting what feels familiar costs us capability we need.

Merit Is Essential. Finding It Is Harder.

“Hire the best-qualified person” sounds straightforward. It is also the right objective.

The harder question is: How do we know who that is?

Research on hiring continues to show that subjective judgments can be influenced by race, gender, familiarity, and expectations about what a successful person in a particular role looks like. Not every difference in outcome is discrimination. However, good intentions alone do not guarantee an unbiased decision.

Experience, judgment, and leadership capability matter. So do characteristics that can’t be reduced to objective metrics.

The more subjective the decision, the more critical it is to ask:

• Do we understand what success requires before evaluating candidates, and are we evaluating demonstrated capability versus comfort with what traditional leadership looked like?
• Are we considering a broad enough talent pool?
• Are people receiving comparable opportunities to show what they can do?

While “Hire the best person” is the objective, we may still need processes that improve the probability of finding that person.

Measurement Creates Accountability

Collecting information about who gets hired, promoted, developed, or compensated does not require quotas or preferential treatment. It provides information.

We measure: financial results, customer satisfaction, safety, quality, employee turnover, and market share because assumptions are not sufficient. Why would talent systems be different?

If women hold 20% of a particular leadership role, the number alone does not tell us why.

The available qualified pool itself may be disproportionately male. Perhaps women enter the organization at comparable rates, but the system loses them later. Are they receiving comparable opportunities to develop and demonstrate their capabilities, take on challenging assignments, gain exposure to important customers or parts of the business, receive mentoring or sponsorship, advance, and receive recognition? In a small business, these opportunities may be less formal, but they are just as consequential. Or does the disparity have entirely legitimate explanations?

Data doesn’t answer questions; it tells us what questions to ask.

The answers to the pertinent questions can reveal a problem we did not see, or can also show that a problem we assumed existed doesn’t. Without visibility, accountability becomes much more difficult.

Deal With What Is True

Our political environment increasingly encourages us to choose between competing versions of reality. One perspective may treat unequal outcomes as proof of discrimination. Another may assume that eliminating explicitly discriminatory rules creates equal opportunity. Neither is necessarily true.

For example, some diversity initiatives may be overly bureaucratic, ideological, or too focused on demographic outcomes. If so, we need to acknowledge that. We also need to acknowledge that bias, unequal opportunity, and structural barriers did not disappear simply because laws changed.

If a system does not work, change it. If an approach unintentionally disadvantages another group, fix it. If a measurement no longer tells us anything useful, replace it. But eliminating imperfect systems without understanding the problem they were designed to address risks creating another problem.

The objective is not to preserve yesterday’s solution. We need to understand today’s reality well enough to design a better solution.

Strategy Is Only as Strong as the Capability to Execute It

This is where the issue moves directly into business strategy.

Strategy is ultimately about choices: where to compete, what matters most, what we will invest in, and what capabilities we will need to succeed. Every strategy therefore contains assumptions about talent, which ideally compels us to consider:

• Do we have the people capable of executing it?
• Where will the next generation of leaders, innovators and problem-solvers come from?
• What capabilities will we need five or ten years from now that we may not have today?
• Are our assumptions about who has potential broad enough to find them?

A sound strategy can still fail if the organization does not have or does not recognize the capability required to execute it.

Talent is a strategic asset.

That is true regardless of company size. A large organization may have thousands of people from whom to build capability. A small business has less room for error: one overlooked employee, poor hire, underdeveloped successor, or unrecognized idea can materially affect its ability to compete.

Talent connects business performance to something larger. Companies create much of the economic capacity that supports technological leadership, scientific advancement, employment, tax revenue, national defense, and the United States’ ability to compete globally.

Through the lens of talent, what matters is:  who companies hire and develop, whose ideas receive attention, who gets the challenging assignments that prepare them for greater responsibility, and who leaves because the organization never learned how to use what they could contribute.

Every organization is one small part of the country’s capability system. The smaller the organization, the fewer people it can afford to overlook; the larger the organization, the greater the consequences. Across millions of organizations, those decisions accumulate into national strength, or national capacity left unrealized.

How organizations identify, develop, and deploy talent therefore affects not only their own competitiveness, but ultimately ours as a nation.

The Demographics Make This Strategic

Women represent roughly half of the U.S. population.

Non-Hispanic white men, historically disproportionately represented in many positions of organizational leadership, represent roughly 28% of the population today.

Those numbers say nothing about any individual’s qualifications. Nor should population percentages determine what a company’s workforce or leadership team looks like. They tell us something different. They tell us where the available talent increasingly resides.

If our traditional image of who looks like a leader, engineer, executive, entrepreneur, or high-potential employee comes from a much narrower segment of the population than the country we actually have, we risk looking for tomorrow’s capability through yesterday’s lens.

And the issue extends well beyond women. Consider what happens when?

• Race, gender, geography, or background influences whose potential we recognize
• Immigration barriers prevent exceptionally talented people from elsewhere from  bringing their knowledge, ideas, and businesses to the US
• Educational barriers prevent capable children from accessing opportunities

In every case, the strategic consequence is similar: Capability exists. We fail to see it, develop it, or use it. This is economic capacity left unrealized.

What Are We Trying to Optimize?

Unintentionally, are we asking too many questions about relative position: Who gained? Who lost? Which group has too much influence? Which group deserves more?  While these questions do matter at times, they can also keep us focused on dividing existing opportunity rather than expanding collective capability.

What could change if leaders asked?

• Where is the talent we are not finding or developing?
• What assumptions might cause us to overlook it?
• What barriers actually improve performance, and which preserve tradition?
• What capabilities will our strategy require that we do not have today?
• Where has the language of merit unintentionally protected existing advantages?
• What would we design differently if our objective were strengthening the organization, and ultimately the country, for the next 10, 20 or 30 years?

These questions create a different conversation. And they move us from defending positions to solving problems.

Leadership Starts With the Part of the System We Influence

No one expects an individual business leader, owner, or CEO to solve the country’s challenges. However, they can influence the systems for which they are responsible: what their organizations measure, who they develop, which assumptions they test, what capabilities they build, and how broadly they search for talent.

That is where strategy becomes action. Perhaps the most pertinent question to ask:

Within the part of the system I influence, am I increasing our capacity to meet what is coming or unintentionally constraining it?

The Bigger Picture Test

The United States will need extraordinary capability to navigate the environment ahead. We will need STRONG:

• Businesses,
• Institutions and national leadership,
• Scientists, engineers, entrepreneurs, educators, healthcare professionals, tradespeople, military personnel, and
• Capabilities we cannot yet anticipate.

We will need the best talent possible: women and men, people from different backgrounds and economic circumstances, people born here and, where it strengthens our country, people who choose to bring their capabilities here.

We do not know from where the next extraordinary idea, leader, or breakthrough will come. Why would we unnecessarily narrow the possibilities? This requires clarity about how high our standards need to be, and argues for meeting or exceeding them across the board.

Find the talent. Develop it. Measure whether our systems work. Remove barriers that do not improve results. Expect performance. Correct what does not work. Keep learning.

Most importantly, always keep the larger strategic objective in view.  The issue is not relative gain. It is collective strength, growth and sustainability, in a world where our margin for error is getting smaller.

When preserving relative power becomes more important than expanding collective capability, we eventually all pay the price.

Our children and grandchildren will inherit the economic, technological, geopolitical, and national-security environment we help create.

Perhaps the question for every leader and every one of us is:

Am I doing all I can, within my sphere of influence, to help leave future generations the strongest country our collective talent can build?