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“There’s something happening here, what it is ain’t exactly clear…”
~ “For What it’s Worth,” Stephen Stills
We used to comfortably measure change in decades. The conservatism of the 1950s and 1980s gave way to the creative innovation of the 1960s and 1990s. But in the world we’ve entered, the volatility and speed of events will have us managing a decades-worth of change annually. I will remember 2025 as the year that the US military’s concept of VUCA fully manifested – the moment we’re living and leading through is truly volatile, uncertain, complex, and ambiguous.
From the dozens of conversations I had with CEOs, senior leaders, and boards late in 2025, one observation stands out: businesses of all stripes are struggling to deliver the results their best-laid plans were designed to produce.
As leaders, it’s our responsibility to bind together an organization’s people and resources to produce a desired result—and how we’ve been doing that is no longer working. It’s one of the big reasons we’re all so tired. The hamster wheel we’re running on is no longer producing the desired results.
I’ve heard the wheel – a company’s process for turning strategy into results – described in many ways: operating model, system, cadence, the how, structure, governance, etc. However you talk about yours, it is some combination of ensuring you have the right capabilities and effective processes for:
The operating system you work within should be designed in alignment with, and in service of, your business model and strategy. As strategy becomes more fluid and changeable in the disruptive 2020s, we must be more proactive in evolving how we lead and operate. A lot of companies and teams are running on a hamster wheel that was constructed in the wake of COVID. And while it may have been well-suited to that unique moment, it’s failing us now.
Our response to this VUCA world cannot be run faster! The smarter choice? Get off the wheel; examine it anew in context of your ambitions, current reality, and strategy; and then, reimagine and redesign.
In my experience, there is no one-size-fits-all approach to operating a complex enterprise or engaging, aligning, and empowering an organization. The best answer in business, just as in life is: it depends.
Great leadership is always contextual and situational, so what works will vary. But if leading through the volatility of 2025 taught me anything, it’s this: leaders and organizations have to become masters of experimentation, testing-and-learning new approaches continuously. What works today may get wobbly tomorrow.
I wish I could provide you useful details on how to conduct an effective operating review or better integrate strategy development and capital allocation. I’ve seen practices that work brilliantly for a particular business or team but, given the uniqueness of your own context and situation, your strengths and weaknesses as a leader, and the dynamism of the marketplace, I doubt describing them would provide you much value.
So instead of talking about specific approaches, let’s focus on some principles that can anchor effective operating models in 2026.
The Oxford Dictionary defines a principle as: a fundamental truth or proposition that serves as the foundation for a system of belief or behavior or for a chain of reasoning. I’ve become a big fan of using principles to guide the thinking and actions of a team or organization.
I learned the power of principles from Kevin Johnson during his tenure as CEO at Starbucks. Kevin is one of most strategic leaders I’ve ever seen close-up. He formulated the “Growth at Scale” strategy, and it fueled global growth, enhanced customer experience, delivered new innovation, and grew Starbucks’s market cap by more than $30B during his tenure.
Kevin believes that articulating clear principles gives leaders and managers the freedom to do what’s right while ensuring that their efforts are aligned with enterprise strategy. Clear, cogent, and compelling principles empower your people, giving them agency to unleash their leadership while ensuring alignment.
As you reimagine and redesign your operating model for this VUCA moment, use these three principles as a compass and measuring stick. They will help you meet the moment.
We’re all walking briskly in the fog—it’s hard to see the horizon, let alone anticipate how events around us will unfold. No one knows what the world is going to look like next year at this time. The collapse of the planning horizon is creating a crisis of clarity and, unfortunately, as human beings we are wired to pour our fears into an information vacuum. Failing to communicate clearly exacts a cost as people shadow box with their fears and focus their attention inward, increasing friction across organizational boundaries. Both hamper quality and productivity.
Sharpen your focus, choices, and messaging. Ensure senior leadership is speaking with one voice about your enterprise ambitions, as well as the current (and future) realities in your marketplace. Get real about your organization as well. You can’t afford to believe the myths—your operating system will fail if designed for capabilities or a culture you don’t have. Ensure your operating model creates forums for leaders to talk about what stands in the way of execution.
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Design an operating model that continually creates clarity for the organization.
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Now is not the time to be sloppy in communicating strategy—you need more than a PowerPoint deck offering broad notions of strategy and financial targets. What’s required now is a clear, cogent, and compelling story about your strategy and a strategic plan that lets the organization understand what must happen, by whom, by when and why. Make sure that senior leadership is collectively and continuously telling the same story. Just as boats use horns in a fog, we need to use our collective voices to lead loudly.
When I started working with executive teams more than thirty years ago, it was common for companies to develop five or even 10-year strategies. Today, planning with those time horizons is magical thinking. Dwight D. Eisenhower famously said, “Plans are worthless, but planning is everything.” Planning helps you think through options, determining and articulating critical work. But don’t spend too long on the planning process or your assumptions may be outdated by the time you begin to execute.
Instead, put more time and energy into ensuring a robust management process that brings together those responsible for execution with those responsible for strategic direction. Make sure they’re talking. Look at the quality and output of your team or organization as part of a disciplined review process, analyzing data, and understanding the stories about what happened and why. Make sure these insights inform your strategy and the execution engine. Integrate test-and-learn – trying things out to identify what works and what can scale – into your concept of planning.
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Design an operating model with a disciplined “plan-do-reflect” cycle and helps maintain the conditions for candor.
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Don’t forget that the effectiveness of your operating model is predicated on a culture of candor which allows the flow of information, insights, and ideas without friction, dilution, or fiction. Unfortunately, candor is a challenge for too many teams and organizations. And really, this isn’t all that surprising; adding uncertainty and stress onto a hierarchical political system is not a great recipe for creating the psychological safety.
Your hamster wheel is not just decision-rights and meeting cadence – it’s also about how people interact. Your operating system should help build trusting, collaborative relationships across teams, units, and silos.
Leadership is the essential ingredient to enterprise success—and making sure it’s focused on the right things is mission critical. In a hyper-competitive VUCA world, leaders need to spend a hell of a lot more time making sense of things, observing the shifting winds and figuring out how to understand, adapt, and navigate. Setting direction and strategy is requiring more time and energy which means enterprise leaders need to get out of the weeds by empowering others to do more.
Leverage your operating model to distribute leadership: engaging, aligning, and empowering next generation talent to get critical work done. Enterprise leaders can only elevate by tapping into more of your organization’s capacity. Next generation leaders bring creativity and more native experience with new technologies – integrating these capabilities with the wisdom and pattern recognition of senior leadership will give you a faster path to the future.
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Design an operating model that effectively distributes leadership, freeing up enterprise leaders to make sense of a changing world, set direction, and create the conditions for business success.
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You can effectively empower – sharing responsibility and authority with the next layer of leadership – by creating new mechanisms to be informed, provide input, or make certain decisions throughout the lifecycle of an initiative. A good operating system should help you mix the various strengths and perspectives at every level powerfully and effectively.
Beyond strategy, enterprise leaders are also responsible to create the conditions for enterprise success. John Gibson, the brilliant CEO of Paychex, taught me that executive leaders need to work on the business, not in the business. Your operating model must enable senior leadership to gain an elevated and complete perspective of your business, organization, and talent, operating at an enterprise level while ensuring accountability for results.
An operating system that doesn’t foster a performance culture is impotent. We’re entering an era where organizations won’t be able to afford mediocre talent – as AI inevitably reduces the number of necessary employees, the ones remaining better be strong performers. The operating model must help create clarity, candor, and consequences to fuel accountability.
A few years ago I adopted the mantra: If I’m doing tomorrow what I did yesterday, I’m probably doing it wrong. It was meant to help me respond to our changing world, recognizing that intentional adaptation is critical to on-going career success. One of my New Year’s resolutions is to redesign the hamster wheel my business uses to produce results, boldly questioning how we run things, where I focus my time and attention, and how we create the conditions for success. Guided by the three principles of Create Clarity; Manage More, Plan Less; and Elevate Leadership, we will test-and-learn our way to successfully navigating this next transformative year.
I hope you find success in 2026 doing the same.
Bob Marcus is a senior member of Russell Reynolds Associates’ Leadership Advisory practice. He is based in New York.