Leading through complexity: A decision-making framework to support future leadership

Future leadership has a different algorithm: context, capability, capacity.

Managing complexity is our responsibility as leaders.

In our fast-paced environment, leaders spend 40% of their time making decisions (McKinsey, 2023). This is amidst an operating environment that sees our reference points changing constantly. In a world where capability requirements can barely stay ahead of skills obsolescence. And decision-making fatigue blurs a leader’s capacity to impact.

Do we have the decision-making framework in place to support our executives?

The Model of Leadership™ provides a structured decision-making framework to help leaders navigate complexity and de-risk leadership blind spots. Decision velocity can overwhelm leaders, so it is critical to outline the anchors that allow efficient and effective choices to be connected to data, evidenced by science, and relevant to everyday outcomes.

According to a recent study of more than 14,000 employees and business leaders across 17 countries by Oracle and NYT best-selling author Seth Stephens-Davidowitz,

• 85% of business leaders have suffered from “decision distress” in the past year,
• 74% of those surveyed disclosed that the number of decisions they make daily has multiplied tenfold in the last three years, and
• 59% admitted facing a ‘decision dilemma’ – the struggle of not knowing which decision to make – more than once every single day.

Research published in Harvard Business Review reveals that more often than not, executives accept roles without ever having discussed decision making in interviews (2024). While the model applies to all decision making, at Future Leadership, we especially use this model when we are making tough decisions about talent.

Why a New Talent Model?

Traditional leadership frameworks often overemphasise past performance (what someone has done) while overlooking future potential (what someone could do under new or more complex conditions). The model by Future Leadership™ addresses this gap by recognising three interlocking elements that predict a leader’s future success:

1. Context – the operating environment and role-specific demands.
2. Capability (Performance) – the knowledge, skills, and mindsets leaders have acquired.
3. Capacity (Potential) – the ability to handle complexity, learn rapidly, and adapt.

By broadening the lens from “what have you done before?” to “how might you think, learn, and perform under evolving conditions?” this model offers a practical, research-based approach for forecasting leadership effectiveness.

Context: The Crucible for Leadership

Context sets the stage in which leaders operate. It includes:

• Macro environment –industry disruptions, emerging technologies, societal shifts, growth stage, organisational culture and values.
• Micro environment – role requirements, level of work, technical expertise needed, and the team’s levels of diversity and inclusion.

Leaders who thrive in one context might struggle in another. For instance, an executive in a fast-paced tech company may excel in driving innovation and rapid growth, whereas a leader in a large, established corporation might be more adept at managing complex hierarchies and ensuring operational stability. Research reported by the Harvard Business Review (2018) has shown that organisations using context-based approaches to leadership selection are 3x more likely to see a better fit than those using generic “one-size-fits-all” models.

Implication: Organisations should tailor their evaluation and development efforts to each leadership role’s unique context. In short, a strong candidate is not just “well-rounded” but “well-suited” to the specific challenges ahead.

Capability: What Leaders Bring to the Table

Capability refers to the knowledge, skills, behaviours, and mindsets leaders have developed and demonstrated over time. It includes:

• History of achievement – evidence of sustained performance.
• Critical Experiences – exposure to pivotal roles, projects, or challenges.
• Capabilities – an umbrella term for transferrable skills, mindsets, and behaviours (mapped to our future capability framework).
• Reputation – how a leader is perceived by peers, direct reports, and external stakeholders.
• Style – refers to the distinct approach a leader uses to guide, motivate, and influence others, shaped by factors such as personality, values, and context.

Crucially, capabilities are transferrable across roles and contexts, though application in new or complex environments is not always guaranteed. From a predictive standpoint, past performance matters most when a leader has had prior experience with similar challenges. However, as roles become more complex, an over-reliance on past success can be misleading if the future task environment is vastly different.

Implication: Evaluate a leader’s proven capabilities alongside their willingness (and readiness) to flex these capabilities under different scenarios. Past achievements are important, but capability must be seen in context.

Capacity: Matching “the Size of the Person” to “the Size of the Role”

Perhaps the most distinguishing feature of the Future Leadership Model is its focus on Capacity, defined as a leader’s potential to handle increasing levels of complexity, ambiguity, and challenge. It encompasses:

• Motivation – what drives a leader, and how do they channel their energy and maintain well-being under pressure?
• Learning Agility – willingness and ability to learn (and unlearn) quickly, especially in first-time, tough, or rapidly changing conditions.
• Cognitive Aptitude – refers to high cognitive aptitude that can embrace multiple perspectives and strategically navigate complex environments, ensuring a leader remains motivated and effective even in challenging situations.
• Dealing with complexity – how leaders think, interpret, and make sense of the world around them. Leaders at more advanced stages are likelier to navigate paradox, embrace multiple perspectives, and adapt to fluid scenarios.
• Derailers – the traits or behaviours that can hinder a leader’s effectiveness, such as an inability to manage stress, poor interpersonal skills, or resistance to feedback.

As Forbes noted in 2022, “What sets excellent leaders apart is the way they embrace and work with complexity. It’s not what you know, but how you think.” Leaders must expand their mindsets—becoming more collaborative, self-aware, and better able to think strategically. Doing so fosters the vertical development necessary to handle new leadership demands as organisations evolve.

Implication: When selecting or developing a leader, it’s not enough to ask, “Have they done it before?” We must ask, “Can they grow in complexity to meet the new challenge?” If there’s a mismatch between the complexity of the role and the leader’s current stage of development, performance likely suffers.

Piecing It Together

The Model of Leadership™ underscores that true leadership success is more than past achievements. At its core, it’s about:

• Context – understanding the unique organisational and role environment.
• Capability – leveraging existing strengths, history of achievement, and transferable skills.
• Capacity – ensuring the leader can handle complexity, learn quickly, and stay motivated even in unfamiliar territory.

These three elements interact. A leader with ample capacity but no relevant background may still thrive if they learn swiftly. Conversely, a leader with a stellar track record may falter in a new, high-complexity environment if they lack the capacity to adapt. Equally, context drives which capabilities matter most and highlights the level of complexity a leader must manage.

Leadership Implications for Organisations

Selection and Assessment

1. Context-Driven Selection: Clarify the role scope, complexity, and cultural nuances before shortlisting.
2. Objective Tools and Subjective Insight: Combine psychometric measures that gauge cognitive capacity, personality, and motivation with the informed judgment of seasoned hiring professionals.
3. Predictive Validity: Look for reliable, validated tools that measure learning agility and capacity for complexity.

Leadership Development

1. Personalised Growth Journeys: Move beyond cookie-cutter programs. Leaders at different stages of development need different types of challenges and experiences.
2. Emphasis on Vertical Development: Encourage leaders to expand their mindsets—by seeking out diverse teams, practicing perspective-taking, and reflecting on how they make meaning of challenges.
3. Feedback and Mentoring: Provide continuous feedback loops and coaching to help leaders integrate new learning and refine their approach.

Sustainability and Future-Readiness

1. Build a Portfolio, Not Just a Pipeline: As the Harvard Business Review (2018) suggests, organisations should see leadership talent as a diverse portfolio. Develop multiple potential successors capable of handling different environments.
2. Systems Perspective: Recognise that leadership capacity shapes, and is shaped by, organisational culture, performance management, and strategic direction.
3. Ongoing Assessment: Because roles and contexts shift, leadership assessments should be revisited regularly.

As organisations face unprecedented levels of disruption, Future Leadership’s Model of Leadership provides a roadmap to identify and grow leaders who can thrive both now and in the future. By accounting for Context, Capability, and Capacity, this model captures the complexity of modern leadership demands and highlights the critical importance of ongoing development.

Ultimately, leadership is not solely about what you have accomplished; it is about who you are becoming. Equipped with the right mix of context-specific insights, track record analysis, and capacity-building strategies, leaders—and the organisations they serve—will be far more prepared to succeed in the face of uncertainty and seize the opportunities that lie ahead.

References

• Adult Development Theory: Kegan, Lacey, Bob Anderson, Jennifer Garvey Berger (1994)
• Learning Agility: De Meuse (2017)
• Complexity Mindset: Forbes (2022, 2020), HBR (2018, 2024), Bain & Company, McKinsey & Co
• Cognitive Ability & Leadership: Dragoni et al. (2011), Hou et al. (2022), Adams et al. (2018)
• The Decision Dilemma: Oracle and Seth Stephens-Davidowitz (2023)