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Three leadership imperatives for 2012

One of my friends from Indonesia, the second in charge of one of the Asia's largest companies, called me in tears at the start of the recession in 2008. "The market is a cruel master," he said, "and people will suffer." Then his voice became steel, and he declared: "Our company, on the other hand, will seize these opportunities and transform itself into a world leader. The economy is giving us a gift, and we will not refuse it."

His dual-mindedness captures what leaders need to do during economic gloom. On the one hand, show compassion for those people who are displaced. Help those who need it.

On the other hand, you need to change yourself and your company immediately. If you don't, the market -- that cruel master -- will steal your customers away, hire your star employees, and force you to play catch up. I made a similar prediction last year, and at the risk of saying "I told you so," read what has happened.

The speed of change is increasing, and 2012 will be even more of a change-or-get-left-behind year. There are three leadership imperatives that you need to implement right away. Doing so will position you, and your organization, for success in the next decade.

1. Test assumptions, try small experiments, and place small bets. If you see echoes of Eric Ries' The Lean Startup and Peter Sims' Little Bets, you're right. Validated learning is a driver of future value, yet most leaders don't know how to learn. In the next year, your ability to learn, and learn fast, will be tested as never before.

2. Supercharge your negotiation ability. The market is having trouble valuing companies, homes, and talent. In times like these, negotiation skills are critical. If you're still thinking "good cop-bad cop" and "win-win," then your negotiation skills are lingering in the 1990s. Read Getting More immediately, and do what author Stuart Diamond says to do -- especially on how to connect with people rather than bargaining ranges.

3. Create your tribe as a network of individual start-ups. I spent part of the last year studying start-ups (such as Airbnb, mentioned in a blog post last year, and the main thing that hit me was that jobs are created around individuals' passions and unique skills. It's as if each person is a company, and the start-up is a massive joint venture effort between all of them. This model moves so fast, can innovate so easily, and is so nimble, that it leaves big companies with bloated rulebooks in the dust. Unlocking people's potential requires building a culture that embraces learning, risk-taking and changing the world. A good first step is to learn to identify the hallmarks of a world-changing corporate culture, and see what improvements you can make between now and the end of March. (I'm doing a webinar later in January with G5 Leadership on great cultures -- free to readers of this blog if you sign up here.)

The question facing leaders at the start of 2012 is: will this be a breakout year, or will you fall behind? The days of having an average year are over.

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