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Less than one-third of organizations believe leadership development has significant business impact, according to Brandon Hall Group’s 2019-2020 Leadership Development Study. Less than 60 percent of organizations believe their leaders possess the competencies and emotional intelligence to successfully drive business goals over the next two years.
The biggest causes of insufficient leadership are inadequate succession management and ineffective identification of high potentials, which will get the heaviest investment in leadership development in 2020 after years of neglect, according to our HCM Outlook 2020 report. Approximately 60 percent of organizations believe their talent pipelines are not large or deep enough, and less than half of organizations believe the pipeline reflects the diversity of their organizations, their markets, and their customers.
Employers must, in some cases, radically transform their approach to leadership to be successful in the 2020s. Failure to do so will have significant negative impact on:
- Business growth
- Employee engagement
- Employee retention
- Employer brand and ability to attract top talent
- Ability to be competitive
Top-Down Failure
Traditional top-down leadership has failed, and organizations hanging onto that model will struggle to survive. We see leadership evolving into a shared leadership model, with a heavy focus on collaboration through teams and fueled by greater inclusion of diverse talent and a culture of continuous learning.
To build a leadership development program that has substantial business impact, organizations must answer several critical questions, including:
- What type of leaders do we need to make our organization successful in the 2020s?
- Do we have a pipeline of high-potential employees who can become the leaders we need to drive business results?
- How do we accelerate the evolution of leadership development to address the ambiguity and complexity of business in the digital age?
- How do we build a culture of collaboration that embraces the shared leadership needed to navigate new challenges through collective wisdom and innovation?
- How do we hire and develop learning-agile employees who can grow into new and emerging roles for which skills and competencies currently don’t exist?
The Best People
The top concern among business and human capital management leaders heading into 2020 is retaining the best people. That starts with strong leadership and developing the next generation of leaders. The top barrier impeding leadership development programs from reaching their full potential is the belief that leaders have limited time to learn.
Embedded in that statement is the reality that leadership development (and learning as a whole) is still event-centric in many organizations. Leaders (and everyone else) should always be learning. Leadership development should be experiential, on-the-job, and through stretch assignments and action learning projects. Too often, that does not happen; almost 40 percent of research respondents said their current learning modalities are insufficient to support a strong learning and development (L&D) program.
Leadership is always critical, but perhaps never more so than now as the fourth industrial revolution gains speed and we face unprecedented change in how businesses operate and work gets done.
Radical Transformation
The workforce is changing rapidly and employers must go into overdrive to catch up. The soon-to-be-majority Millennial and Gen Z workforce was raised on collaboration and social connections. They expect to have access to leaders at all levels and to have their opinions heard. They are focused on building experience throughout their careers, and not necessarily along a traditional vertical path. This requires employers to reinvent their approach to leadership and career development.
Shared Leadership for the Win
Only through the inclusion of diverse leadership talent at all levels of the enterprise can businesses succeed in the future world of work. All levels of leaders—from individual contributors and subject matter experts to front-line leaders and cross-functional team leaders in addition to traditional leadership positions—should share in leadership depending on the capabilities and expertise required.
A core competency for senior leaders will be understanding the different types of leaders that need to be leveraged in different situations and bringing those people to collaborate to solve critical business challenges.
A culture of shared leadership requires a growth mindset, where employees understand the need to adapt to challenges by learning and setting new goals. All experiences and talents must be valued. Employees must feel safe to express their ideas and perspectives. A shared leadership environment is one in which people can “think out loud” and aren’t afraid to make or admit a mistake or change their minds or positions if influenced by colleagues’ ideas or experiences. This psychological safety enables collaboration that drives better decisions.
To download a free copy of Brandon Hall Group’s research summary, “Rethinking the Learning & Development Budget,” click here.
Claude Werder is the vice president of Research Operations and Principal HCM Analyst at Brandon Hall Group. The firm’s vision is to inspire a better workplace experience, and its mission is to empower excellence in organizations around the world through its research and tools. Brandon Hall Group has five human capital management (HCM) practices and produces the Brandon Hall Group HCM Excellence Awards and the annual HCM Excellence Conference, in West Palm Beach, FL, February 4-6, 2020.