Imagine sitting in a Pick n Pay executive meeting in 2018. Revenue is still flowing. Millions of customers are still walking through the doors. The brand remains one of the most recognised in South Africa. The dashboards are largely green and nothing suggests the business is in crisis.
Yet with hindsight, we know something important was already changing. Not performance. Confidence. Not in the people leading the business but confidence in the assumptions underpinning it. The assumption that customers would continue to perceive value, that the store network remained competitive, that operating costs could continue increasing without affecting market position and that competitors would not fundamentally reshape customer expectations.
None of these assumptions failed overnight. And that is precisely the point. Organisations rarely encounter performance problems overnight. More often, the assumptions that support performance gradually erode. Performance decline is simply the delayed manifestation of those changing assumptions. This is one of the most important lessons in modern leadership.
Most executive teams spend enormous amounts of time managing performance. Revenue. Margins. Market share. Project status. Operational targets. These metrics matter. But they all share the same limitation. They are lagging indicators. They tell leadership what has happened and very little about what is likely to happen next.
The organisations that consistently outperform understand something different. They recognise that while performance is a lagging indicator, confidence is a leading one. And confidence isn’t a feeling. It’s a leadership assessment of whether the assumptions underpinning future performance remain valid. That distinction changes everything.
A project can be green while confidence is deteriorating. A strategy can appear sound while the assumptions supporting it are becoming less valid over time. A business can be performing well while its future competitiveness is quietly eroding. The danger is that most organisations are not structured to see this. Executive reviews are designed to confirm progress. Board packs are designed to explain performance. Reporting frameworks are designed to provide assurance. Very few are designed to test confidence. As a result, leadership teams often spend significant time discussing outcomes and comparatively little time discussing uncertainty. Yet uncertainty is where future performance is ultimately determined.
The highest-performing organisations approach leadership differently. They don’t simply review results. They interrogate assumptions. Instead of asking: “Are we on track?” They ask: “What could realistically prevent us from delivering?” Instead of asking: “What are the current results?” They ask: “What assumptions are those results dependent on?” Instead of asking: “What happened?” They ask: “What is changing? And perhaps most importantly “What decision would we regret not making today?” These questions shift leadership conversations from hindsight to foresight, from reporting to decision-making and from explaining outcomes to influencing them.
Every major business failure is preceded by a period where confidence should have fallen, but didn’t. Pick n Pay is one example. Eskom is another. The crisis didn’t begin when load shedding became a national reality. It began when confidence in the assumptions underpinning generation capacity should have changed. The same principle applies across industries. Major failures are rarely caused by a sudden absence of information. More often, they occur because assumptions erode faster than leadership recognises and by the time performance reflects the problem, the opportunity to influence the outcome has already narrowed.
This is why risk leadership is evolving. The purpose of risk is not to maintain registers. Nor is it to satisfy governance requirements. Its purpose is to improve decision quality under conditions of uncertainty. As Sanjar Bhana, 2nd Vice President of IRMSA, argues, the real question leaders should be asking is: “How confident are we that we will deliver what we have committed to?” That’s a fundamentally different question from reviewing status reports. And it’s a far more valuable one. Because the role of leadership is not to predict the future. It’s to recognise declining confidence while there is still time to act.
The organisations that thrive over the next decade won’t necessarily be those with the fanciest dashboards, the most reports or the most data. They will be the organisations that identify eroding assumptions earlier. The one’s that confront uncertainty sooner and make better decisions while they still have options.
That is where BarnOwl creates value. Performance tells leaders what has happened. BarnOwl helps them understand what is likely to happen next. By integrating risks, controls, incidents, actions and leading indicators, BarnOwl provides early visibility into the assumptions, conditions and exposures that ultimately determine future performance and organisational confidence.
Because performance tells you where you’ve been. Confidence tells you whether you’re still on course to get where you’re going.