Leadership is the number one issue organizations around the world face today.
85% of companies surveyed by a team at Deloitte rated the issue as “urgent or important” – more so than things like talent acquisition, retention and engagement. But less than 15% of those same companies could say they did an excellent job of developing global leaders.
The report went on to surmise that “the capability gap for building great leaders has widened in every region of the world.”
Without their own pool of potential leaders to develop and nurture, organizations are forced to recruit externally. This comes at a higher price, and often with mixed results.
So why exactly are organizations struggling to produce new leaders?
Well, one problem is simply that leaders are retiring without leaving behind an adequate pool of successors. Employees are moving from role to role and job to job more and more. Expecting an organization to produce a pool of leaders-in-waiting is no longer feasible.
Secondly, when they are developing future leaders, they’re usually going about it in the wrong ways.
With a workforce comprised of five generations (Baby Boomers, Generation X, Generation Y or Millennials, and the now emerging Generation Z, also known as iGen or Generation 2020), the idea of what makes a good leader is in a state of flux. Traditional leadership—the kind Baby Boomers will be most familiar with—was consensus-driven, and structured by routines and processes like appraisals. The boss in the big office delivered orders and his workers carried them out.
But this kind of top-down, information sharing, decision making and development modelling is becoming increasingly ineffective.
Essentially, the very idea of what it is to be a leader is changing.
We now have to think about leadership at all levels. All employees at all levels in the organization need to be informed, enabled and empowered to move company goals. Agile and innovative, modern leaders must be informed by data, enabled by the right tools and empowered by authority.
What kinds of tools do we mean? Well, they could include creating a shared ownership or autonomy (engaging employees in a shared ownership approach, where both parties are vested in the success of the organization), training managers to coach (especially at mid-level) and building personalized development programs.
A Harris poll conducted on behalf of Saba found that nearly 70% of employed U.S. adults consider themselves leaders, regardless of their job title. There’s a growing sense that people are itching to lead, irrespective of whether it comes with the traditional leader name tag. Younger generations are more expectant. You give them the opportunity first, and then they prove their worth. The workplace is shifting too rapidly for people to sit patiently and earn their stripes.
So where do we find these new leaders?
Perhaps predictably, you'll often find these new leadership models in practice in newer industries. In digital, for example. Digital industries are invariably places brimming with young, dynamic talent with new ideas and new ways of thinking.
These are places where traditional top-down hierarchies have never really existed. Places where old-fashioned leaders never had the chance to implement old-fashioned ways of thinking.
How exactly do you accommodate leadership at all levels? How do you ensure it's implemented?
For one, organizations need to focus on discovering talent in the early stages of their career.
Deloitte suggests that senior executives “create a culture that broadens the opportunity for leaders to develop in new ways.” They should continuously put potential leaders in “positions that stretch them beyond their current skillsets.”
Ram Charan's Leadership Pipeline is also a useful tool for identifying leaders at all levels. It's a six-passage process where individuals may, over the course of their career, move from managing themselves to managing an entire organization.
Leaders progress through six key transitions, or "passages," in order to succeed. Stages include managing yourself, managing others, managing managers, functional manager, group manager and business manager. Each leader needs different skillsets and values and to develop them over time.
But before you implement more complex models, you need to lay the foundations.
The whole process starts with knowing what mindset you want your future leaders to have, and how you want to help them develop.
Mindset is an approach someone adopts in response to, or in the face of tasks, challenges and opportunities. We’re talking about someone's application of their experience, their learning agility and their ability to develop and deploy abilities. Mindset isn’t about which university someone went to.
Mindset can influence nearly every aspect of a person’s working life, and it’s becoming just as important as skillset. If organizations really want to embrace the new world of work, mindset is their key to successfully navigating it.
As more organizations dismantle their traditional hierarchies, and as more traditional leaders retire, the need to establish a leaders-at-all-levels culture grows significantly. To attract and retain the top talent of the future, leadership at all levels must become a strategic imperative. How organizations do it is something they need to take their own lead on.
Need assistance with leadership training and coaching? Contact Hudson.