Why Finding Effective Leaders Remains a Challenge

May 19, 2016 – Existing methods of identifying and developing leaders are failing, creating a gap between traditional ideas of leadership effectiveness and what it actually takes to drive sustained business performance, according to ManpowerGroup‘s Right Management just released ‘Most Likely to Lead’ report. Astoundingly, 87 percent of employers surveyed said they do not believe they have the future leaders needed to full critical roles.

According to the study, which also gathered research from The Conference Board, 41 percent of company leaders are unprepared to meet the business issues they will face over the next three to five years.

Empty Leadership Pipelines

Right Management also found that only 20 percent of managers identified as high performers successfully advance to higher levels of leadership — and a measly 13 percent of senior executives and human capital managers believe their organizations have ample leadership pipelines.

‘The CEO Succession Planning Survey,’ conducted by consulting firm AlixPartners and executive search firm Vardis, reached similar findings. Their report found that more than half of companies do not have a strong candidate prepared in the high risk, and not uncommon event, of a CEO transition. Of all respondents, 31 percent said they had no CEO successors identified, while 20 percent said their firm had just one successor identified.

Unevenness in succession planning is rampant among many leading companies, reports Hunt Scanlon Media, and when a top leader unexpectedly dies or becomes incapacitated is the generally the time boards of directors first discover their leadership deficiencies.

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Seventy four percent of HR leaders have identified leadership succession as a primary internal challenge they face, according to a survey by talent solutions provider Lumesse and research company Loudhouse. The identification of leaders is crucial to mitigate against the loss of critical talent in the future, something that 73 percent of respondents said is the biggest threat to their business over the next 12 months.

“In many organizations we still see future leaders selected on gut-feel, contacts, time in the job or simply right-place, right-time. It’s clear this model isn’t working,” said Mara Swan, ManpowerGroup executive vice president, global strategy and talent & global brand lead for Right Management.

It’s not all nature though says Right Management. The report identifies a set of highly focused, coachable leadership capabilities that will improve an organization’s ability to compete and win. These include the ability to manage, develop and inspire talent; to accelerate performance by building winning teams and a flexible infrastructure; and daring to lead so that leaders challenge the status quo and seize opportunity.

What Skills Are In Demand?

Right Management said that organizations are more likely to perform at their best when a leader develops the skills to:

Provide a shared vision for transformation — Effective leadership is about articulating a vision – one that gives employees the ‘why’ behind their contributions, engages their minds and hearts, and unites their efforts toward a common goal.

Navigate both a short and long term agenda — Achieving sustained performance requires leaders who can balance near-term revenue and cost concerns with longer-term strategies for business development.

Balance global consistency and local relevance — Effective leaders ensure the business operates from a consistent set of strategies while enabling the flexibility to adapt to local needs and cultures.

Inspire and mobilize the organization in transformation — Improving employee engagement is the key to creating a more competitive organization, and it starts at the top. Effective leaders help employees buy into the company’s direction. They understand the significance of their role in helping the company reach its goals.

Collaborate transversally — Increasingly, work gets done by sharing ideas across disciplines, across time zones, across cultures, and across companies. Leaders set the tone for enabling that level of collaboration.

Build high performing teams — Individual performance is necessary but not sufficient to drive organizational performance. Leaders need to address underperformance of teams and create the conditions for the different teams to perform.

Build organizational capability — Leaders need to insist on an infrastructure with appropriate systems, resources and processes in place to achieve strategic goals.

Why Finding Talent is a Struggle

Finding people with these desirable traits isn’t easy.

Due to demographic and societal shifts, companies are struggling to find people with the precise skills or combination of skills they need, according to the Right Management report. In 2015, over one third of employers worldwide said they were having trouble filling positions due to lack of suitable talent.

As the global demand for highly skilled labor continues to grow, the report suggests that leaders will need to align their talent strategies with their business strategies to ensure that they have the right people in place, and rethink old assumptions about work models, people practices and talent sources.

Numerous reports have recently surfaced about companies experiencing talent shortages.

ManpowerGroup’s ‘Talent Shortage Survey’ found that 32 percent of U.S. employers reported difficulties filling job vacancies due to talent shortages. Globally, the study found that the percentage of employers experiencing difficulties continues to rise, increasing from 36 percent in 2014 to 38 percent in 2015.

“Talent shortages are real and are not going away,” said Kip Wright, senior vice president, Manpower North America. “Despite impacts to competitiveness and productivity, our research shows fewer employers are trying to solve the problem through better talent strategies. As the struggle to find the right talent continues, and candidates with in-demand skills get the upper hand, employers will be under pressure to position themselves as ‘talent destinations’ to attract the best workers that will drive their business forward.”

According to the latest ‘Recruiter Nation Survey’ released by Jobvite56 percent of recruiters cite the lack of available skilled talent as a key stumbling block in hiring. The report, which polled over 1,400 executive recruiting and human resources professionals, also found that 95 percent of recruiters anticipate equal or increased competition for talent over the next year.

Contributed by Scott A. Scanlon, Editor-in-Chief, Hunt Scanlon Media

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