Influence, authority and the new psychology of leadership

From hybrid work to rapid technological disruption, leaders today face an environment defined by volatility. On our Think Ahead podcast, Sergei Guriev, Professor of Economics and Dean at London Business School, speaks with Niro Sivanathan, Professor of Organisational Behaviour at London Business School, and Diana Torres, Senior Managing Director at Teneo, to explore how influence and authority are reshaping modern leadership. What emerges is a portrait of leadership less rooted in hierarchy and more in trust, timing and the psychology of human behaviour.

Why uncertainty changes how we perceive strong leadership

Periods of instability sharpen our instinct to seek clarity. Niro’s research shows that when economic uncertainty rises, people are more drawn to leaders who project confidence and control. In moments when individuals feel a loss of agency, someone offering direction can feel deeply reassuring.

Yet not every situation is a crisis that demands firm command, said Diana, adding that in highly turbulent transformations, teams initially need a clear vision and focused priorities. But beyond this immediate stabilisation, sustainable progress depends on something more collaborative. Modern challenges are too complex to be solved through one person calling every shot. What’s more is that leaders who behave as if every moment requires unilateral authority risk overlooking vital knowledge and constraining innovation.

Trust as a leader’s greatest asset

If influence is the mechanism of leadership today, trust is its foundation. When teams trust their leaders, performance accelerates; ownership widens; and constructive challenge becomes possible. But trust is fragile, and leaders who rely heavily on directive authority often face harsher judgement when things go wrong, while those who lead with transparency and openness foster resilience even through difficult decisions.

Both guests highlight the same principle: people care not only about what leaders decide, but how and why they decide it. Explaining the rationale behind difficult choices and taking responsibility when mistakes occur are critical behaviours. Diana argues that accountability – especially when outcomes fall short – is one of the clearest markers of genuine leadership and one of the fastest ways to earn long-term credibility.

Leading across generations and expectations

Today’s workforce is multigenerational, globally distributed and shaped by very different expectations of work. Younger employees place a higher premium on autonomy, purpose and psychological safety. Traditional command and control styles rarely resonate in environments that rely on cross functional collaboration and rapid innovation.

This calls for leadership that is adaptive rather than fixed. As Niro describes it, the challenge is not choosing between being dominant or inclusive but knowing when each approach is appropriate. The qualities that help an organisation navigate an acute crisis are not the same ones that sustain creativity, growth or renewal. Diana added that leaders who can shift their style – combining clarity with empathy, direction with openness – are better equipped to meet the demands of today’s dynamic workplace.

A leadership model for a more complex world

The conversation points to a broader shift: leadership today is less about commanding from the front and more about creating the conditions in which others can excel. It requires clarity of vision, disciplined focus and the ability to empower teams – combined with humility, curiosity and a willingness to admit uncertainty.

Both Niro and Diana agree that trust will be the defining competitive advantage of the next decade. Leaders who communicate transparently, listen deeply and give their teams space to contribute will build organisations capable of thriving amid uncertainty.