Why workforce strategy is the blueprint for adaptive leadership

This article is the second in a series on adaptability that explores how individuals, leaders, and organisations can build the capacity to navigate complexity and change. Following on from Adaptability - Strategic Capability We Can't Ignore, this article makes the case that adaptive leaders can't be developed through training alone - they must be enabled by a deliberate workforce strategy. It explores how role design, governance, performance systems, and culture can embed adaptability into everyday work, equipping leaders to navigate AI disruption with purpose.
 

AI is not a philosophical dilemma, it's a leadership problem

Artificial Intelligence is not a future threat-it's a present reality. Already, it is reshaping workforce structures, operational systems, and leadership expectations across Australia's public sector. This is not a discussion about AI governance, or the responsible use of AI in Government. In a workforce where disruption touches every role, every level, and every generation, this is a discussion about the capability for our leaders to adapt, and whether our systems support them to adapt at scale.

A recent Academy of Management Insights article captured this succinctly: 'What we thought was work protected by natural human abilities-white-collar work, cognitive work, even non-routine work-a lot of that is also doable by this kind of AI'. This raises a more fundamental question for the public sector and the future of work. We need to ask, not just who needs to adapt, but are we building the leadership conditions that make adaption possible for everyone?

Public sector transformation is often framed as a system challenge or a policy task. But increasingly, it's about what leadership enables. When Ronald Heifetz introduced the concept of adaptive leadership in Leadership Without Easy Answers (1994), he made a fundamental distinction between technical problems-those with known solutions-and adaptive challenges, which require experimentation, value shifts, and learning. AI is clearly the latter.

Adaptive leadership is not tied to formal authority or traditional hierarchy. In complex environments, it involves mobilising others to do the hard work of adaptation. It requires creating the conditions in which people can engage with disruption constructively-something more profound than simply following a change management plan. Northouse (2016) expands this thinking by describing adaptive leadership as helping people do the work they need to do in order to face challenges. It's a behavioural model - one that emphasises situational awareness, feedback, and support for people navigating change. In the context of AI disruption, it is essential.

As AI adoption accelerates, we are seeing tools such as generative AI, machine learning and natural language processing now being integrated into service delivery, policy analysis, and back-office functions. These technologies do more than automate tasks - they alter how knowledge is produced, how decisions are made, and how accountability is distributed. McKinsey's 2025 Superagency report found that staff are using AI tools up to three times more than their leaders expect but only 23% believe their leadership is equipped to navigate the associated change.

What adaptive leadership looks like

Adaptive leadership in the public sector involves recognising systemic disruption and uncertainty as part of the operating context; framing challenges in ways that engage multiple perspectives and avoid defaulting to technical fixes; creating space for learning, reflection, and failure in systems that often prioritise performance and certainty; and distributing leadership and decision-making across levels to surface insights and enable responsiveness.

Adaptive leadership needs to begin with the leader's own capacity to adapt - only then can they foster the conditions that enable others to do the same. Academic literature on the topic of adaptive leadership frequently suggests that adaptive leaders must demonstrate behavioural flexibility, collaborate across boundaries, and remain resilient under pressure. Therefore, if leaders are to be adaptive, they must also learn the skill of adaptibility - the ability to respond to change, navigate uncertainty, and remain open to new perspectives is foundational to adaptive leadership.

Leaders must help their teams shift from adhoc participants of AI transformation to active agents in shaping how these tools are used. We're not suggesting a wholesale rejection of public sector discipline. Rather, it calls for a shift in leadership assumptions that incorporates greater curiosity, a focus on helping teams interpret and navigate complexity, and a stronger foundation of trust. It also requires navigating tension. Adaptive leaders must hold steady in the discomfort of incomplete answers, manage competing demands, and preserve core values while letting go of outdated routines.

These capabilities can be supported - but only if they are designed for. That is, intentionally built into workforce structures, processes, and cultural norms rather than left to emerge by chance.

This is not about leadership programs. It's about leadership culture; one that creates the authorising environment for leaders to work differently - and for others to follow.

Enabling system-wide adaptation

Despite its relevance, adaptive leadership is not yet embedded in many public sector environments. Legacy hierarchies still dominate, with an emphasis on compliance, authority, and risk aversion. In these environments, it is difficult for leaders to regulate the 'heat in the system' - a term Heifetz uses to describe the productive tension needed for adaptive work. Too much heat creates distress and disengagement. Too little, and nothing changes.

Scott and Bender (2025), in The Role of Adaptive Leadership in Times of Crisis: A Systematic Review of Conceptual Framework, found that alignment between organisational strategy and leadership approaches is instrumental in enabling adaptive leadership. This is where workforce strategy plays a critical role in enabling an adaptive leadership culture. This includes governance that enables distributed decision-making; role design that integrates AI to automate routine tasks and free up capacity for high-value work; performance systems that recognise experimentation and learning; and cultural cues that support psychological safety, encourage reflection, and position failure as a catalyst for adaptation. 

In a world where disruption has completely redefined ways of working, workforce strategy is critical to establishing the conditions in which leadership culture thrives. Applying workforce strategy as an adaptive leadership technique enables leaders to align workforce structures with evolving capability requirements. It supports the assessment of which roles are likely to change, what new skills will be required, and how leadership layers need to shift to support innovation. But its influence extends beyond structure.

A well-designed workforce strategy drives cultural and behavioural change by reinforcing the mindsets and habits needed for adaptive leadership. It also underpins a compelling Employee Value Proposition (EVP), signalling to current and future employees that the organisation values flexibility, growth, and purpose. At its best, workforce strategy recognises the reciprocal relationship between capability and workforce design - capability drives workforce demand, while workforce design enables capability to be realised. This interdependence must be made explicit and actively managed if the public sector is to embed adaptive leadership at scale.

Workforce strategy also plays a role in ensuring that AI tools are implemented in a way that aligns with public service values and enhances service equity. In a world where disruption has completely redefined ways of working, workforce strategy is the lever for institutionalising adaptive leadership - not as a theory, but as a default setting.

A strategic priority for the public sector

Adaptive leadership is not a theoretical ideal - it is a practical necessity. As AI disruption accelerates, the demands on public sector leaders will only grow. Leaders must be equipped to move beyond compliance, navigate complexity, and create space for ongoing adaptation and growth. Leadership programs can introduce the concepts, but without the reinforcement of a comprehensive workforce strategy, the capability will fade. Workforce strategy provides the scaffolding - role design, mobility pathways, performance systems, and cultural settings - that enables leaders to practice adaptive behaviours in real contexts, not just learn about them in a classroom.

Embedding adaptive leadership therefore requires more than attendance at a course. It requires system-wide commitment. It requires coordinated investment in leadership development, alignment of performance frameworks with adaptive behaviours, and the deliberate design of organisational structures that support flexibility, knowledge flow, and learning. This integration ensures that adaptive leadership is a core element of the organisation's operating model.

The opportunity for the APS is clear. By embedding adaptive leadership within a coherent workforce strategy, the system can respond to AI disruption proactively; anticipating change, engaging stakeholders, and preserving public trust. The challenge lies in acting with urgency to design the conditions that make adaptability possible, sustainable, and system-wide