Title:
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Leaders' adaptation to adversity in a volatile, uncertain, complex, and ambiguous business environment : a critical realist view
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Recent studies have shown that a significant number of leaders are not able to successfully adapt to adversity within today's increasingly volatile, uncertain, complex, and ambiguous business environment. Adversity is one of the most challenging leadership issues to date, but fragmented research results prevent researchers and practitioners from forming a comprehensive view of the factors that influence leaders' adaptation to it. This study addresses three questions in respect of the above research gap, namely: What is the nature of adversity? How can leaders adapt to adversity? What are the main factors influencing leaders' task adaptive performance? The study shows that burnout is increasingly recognised as adversity in leadership triggered by volatile, uncertain, complex, and ambiguous conditions. Leaders affected by a high level of the impact of adversity (magnitude, probability and relevance) and a low level of sense-making of adversity have increased burnout risks. Another contribution of this study is that leaders knowing this explanation are better prepared to prevent, anticipate or deal with adversity in order to avoid negative effects, and to see the positive side of adversity as a chance for learning and personal growth. There is also evidence that a higher level of burnout can decrease the leaders' psychological capital. The main theoretical contribution of this study is that the mechanisms of psychological capital and authentic leadership can improve leaders' task adaptive performance. These mechanisms are affected by the condition of burnout. Whereby a high level of the mechanism of the impact of adversity can directly decrease task adaptive performance. Further conditions which affects these mechanisms are sense-making of adversity, self-reflection and conscientiousness. The limitations of these findings are also discussed and the possible directions for future research are outlined.
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