Ask Alto : What is strategic empathy, and why is it a key leadership skill in 2025?
In times of disruption, the “soft skill” of strategic empathy might be the most important thing a leadership team can cultivate.
In late December 2024, OpenAI released a new artificial intelligence model called o3, and provided startling benchmark test results that suggest a large advance over what was previously thought to be state-of-the-art in AI, according to at least one expert.
On January 7, 2025, wildfires roared across the Los Angeles area, killing at least 27 people and destroying thousands of structures. The fires are being reported as linked to climate change.
And on January 20, Donald Trump marked his inauguration as United States president by rescinding 78 of former President Joe Biden’s executive actions and signing dozens of orders, memorandums and proclamations of his own.
It’s early in the year, but not too early to say that 2025 is bringing significant disruption to the world and to business, and it’s bringing those changes faster than many people can cope with. “Before we have a chance to respond to one disruption, another one hits us, such is the speed of change,” writes Costa Markides, Professor of Strategy and Entrepreneurship at the London School of Business (LSB).
Markides points out that continuous disruption requires continuous readiness and continuous change at a strategic level – and that for employees, this can feel like fighting battle after battle. In these circumstances, agility and resilience are often suggested as essential leadership qualities, writes another LSB expert, Randall S. Peterson, Professor of Organisational Behaviour.
Empathy is also often mentioned as a key leadership skill. But Peterson says it’s important to distinguish between cognitive empathy (rationally understanding other people’s emotions), which is helpful, and affective empathy (feeling what they feel), which is not.
Enter the concept of strategic empathy
Strategic empathy was described first as a military or diplomatic concept. In a 2018 book, former National Security Advisor and retired Lt. Gen. H.R. McMaster, called for leaders to embrace strategic empathy, which he defined as “the skill of understanding what drives and constrains one’s adversary”. He was writing in the context of the way the US had conducted itself during the Cold War – but strategic empathy can work in business too.
What is strategic empathy?
Empathy is defined as “the ability to recognise, understand, and share the thoughts and feelings of another person, animal, or fictional character.” It’s been a core concept in psychology since the early 20th century – and is widely bandied around as a crucial part of being human.
But empathy has some elements that are less widely understood, which are central to developing it as a leadership skill. Writing in Æther: A Journal Of Strategic Airpower & Spacepower, Robert S. Hinck and Sean Cullen say: “Empathy is distinct from concepts like sympathy or compassion [which] imply a prosocial and benevolent attitude toward others… Empathy does not inherently require such positive regard… one can empathise with another person’s situation, mindset, and/or emotions without sharing, agreeing, or approving of their perspective.”
Stephen Kohler, Audira Lab’s founder & CEO, suggests that empathy and pragmatism are not mutually exclusive. “The best leaders understand that navigating difficult times require them to tap into both… to acknowledge the harsh realities of business while keeping in mind the people those decisions affect. True leadership requires balancing compassion with decisiveness.”
Empathy, used strategically, is an attempt to understand another person’s perspectives to craft a response that advances one’s own interests. In a business context, that means being able to use an understanding of others – including team members, customers, and competitors – to make decisions that benefit the organisation.
Why is strategic empathy important for companies in 2025?
A study by the Centre for Creative Leadership looked at data from 6,731 mid- to upper-middle-level managers in 38 countries and found that empathetic leadership was positively related to job performance, particularly among middle managers and above. And managers who were rated as empathetic by subordinates were rated as high performing by their own boss. In addition to better job performance, strategic empathy can bring these benefits:
• The ability to deal with rapid change: In the case of AI adoption, employee resistance and fears can be addressed empathically, while still doing the technological work needed.
• Competitive advantage: Strategic empathy can help businesses to understand their competitors and better anticipate market trends. And understanding customer needs and motivations can lead to improved products and services.
• Hybrid and remote work: Empathy is crucial for maintaining team cohesion and productivity in virtual work environments.
• Informed decisions: By understanding different perspectives, leaders can make more informed decisions that consider a range of factors.
• Strategic communication: Leaders need empathy to communicate strategic objectives clearly and to make sure that their audience’s responses are understood and taken seriously.
Most importantly, leaders in times of chaos and unpredictability need people around them who can follow them when a change in direction is needed. That takes trust – and trust can be built by building mutual understanding.
What do leaders need to do to become strategically empathic?
Strategic empathy requires a balance of cognitive and emotional understanding. It’s about both understanding how people think (cognitive) and how they feel (affective). As always in leadership, the first step is self-reflection and taking the feedback of other people seriously.
The Center for Creative Leadership suggests these four concrete steps that leaders can take:
1. Watch for signs of burnout in others: Leaders who are skilled at strategic empathy can recognise signs of overwork in others before burnout becomes an issue that results in disengagement or turnover. This might mean taking a few extra minutes each week to check in with team members and gauge how they’re handling their current workload.
2. Show sincere interest in the needs, hopes, and dreams of other people: Part of leading with empathy involves working to understand the unique needs and goals of each team member and how to best match work assignments so that both performance and employee satisfaction are in the mix.
3. Demonstrate a willingness to help an employee with personal problems: Empathetic leaders understand that their team members are dynamic individuals who are shouldering personal problems while having to maintain their professional responsibilities. They see it as part of their role to lead and support those team members.
4. Show compassion when other people disclose a personal loss: Even if a leader can’t relate to the specific loss that team member experiences, they can act empathetically and let the employee know they’re supported.
And how to build strategic empathy in the organisation?
• Invest in training and develop a coaching culture: Provide training on emotional intelligence, AI literacy, and communication skills. Implement a coaching approach to leadership that supports team development.
• Encourage active listening: This entails thinking about the feeling behind what is being said. The emotion gives evidence of the real intent of the conversation, which allows the listener to respond appropriately. Active listening involves minimising one’s own internal chat about how to respond to what is being said.
• Promote diverse perspectives: Create a culture that values different viewpoints and experiences.
• Value qualitative data: Balance data-driven decision making with qualitative insights and human intuition.
• Foster a culture of curiosity: Develop a culture that values self-reflection and iterative learning.
• Prioritise human-centric approaches: Ensure the focus is always on people as well as profit.
• Model empathetic behaviour: Leaders must display empathetic behaviour to encourage it in their organisation. Talking about it helps too: many managers focus on task-oriented skills such as monitoring and planning; leaders need to be clear that understanding, caring, and developing others is just as important, if not more important.
In the end, it’s about kindness
While leading the company Ashley Stewart after a run-in with bankruptcy, author James Rhee became convinced that kindness was key to success. He writes: “Fundamentally, kindness involves helping other living beings embrace their agency. Think back to how your favourite childhood teacher or coach made you feel. Chances are they saw your potential in ways you couldn’t. They pushed you to see it, too. In return, you did your best for them. You couldn’t bear the idea of disappointing them, but more important—as they likely told you—was you not disappointing yourself. And when you fell short, they forgave you. There was grace.”
FURTHER READING
Ask Alto: How to make AI work in your organisation
Ask Alto : How leadership can tackle burnout
AltoPartners Guide to Diversity, Equity and Inclusion: Cultural competence and diversity initiatives
Written by Renee Moodie