The 2018 Global Leadership Forecast by DDI found that 65% of CEOs believe their top challenge is developing the next generation of leadership for their organization. And 60% believe their organizations are failing to attract and retain top talent. How are you preparing the next generation of leadership?
I’ve been helping organizations develop their leadership pipelines for almost 20 years. Why are so few ready with their next generation of leadership? What has failed and what can we do about it? I believe the next generation of leadership will be different from others. Millennials and GenXers require different skills to be effective in their management roles.
We have failed to develop the next generation of leadership because we have failed to include management training in our leadership development programs. Our universities and business schools have created a generation of leadership who have a very limited view of what it takes to succeed in business. Many have catered to what organizations want to hear and foregone what the next generation of leaders need to do to excel.
They are not alone in this. Look at today’s stock market and you can see short term investors who are destroying the value in our organizations. “What have you done for me lately” is a war cry of many investors. I want my investments to pay me big today and then big again tomorrow.
This is cycle of wealth destruction will cripple the global economy for years to come. Public companies’ executives are under tremendous pressure to produce extraordinary results as they struggle to recreate themselves into smarter, agile, and more anticipatory organizations.
Privately held organizations have a different set of challenges. They must compete for the best and brightest for their organizations. In the past, these organization cultivated cultures that could compete with large organizations by providing higher levels of customer satisfaction. They spent their time creating outstanding customer experiences long before it was trendy or cool. Today, this is expected, or demanded, might be more accurate.
It used to be better, faster, cheaper: pick any two. Today we live in an age of the raging customer. An individual with some social media skills can impact organizations and people in ways unimaginable, even five years ago. Many companies have been slow to respond to these changes in their markets. Commoditization is happening everywhere. The empowered customer is a hard trend. We will never return to how things were.
What does this mean to you and your organization? How do you prepare your team for this changing business environment? Why do I start by sharing these issues as we talk about the next generation of leadership? I believe the best leadership development programs incorporate the changing business environment in their training and activities first. Does yours?
Is the next generation of leadership being prepared for success? Millennials and GenXers are going to have to deal with a rapidly changing business environment. The answer you hear from many executive leaders is technology will take care of this. Artificial intelligence, advanced analytics, and the Internet of Things is going to transform our world. They are today’s silver bullet of choice for many corporate titans.
You might remember some of the other silver bullets leaders have used in the past; reengineering, quality management, vendor management programs, CRM, and paperless offices, to name just a few. What leaders forget to consider is who will implement these changes. They forget it’s all about the people, not about the tools they choose to use. To get the best ROI from your people, you must invest in your people. Are you?
A final thought I’d share with you is that a certain percentage of your team members will invest in their own future. You might even be one of those people. Many early stage entrepreneurs tell me this is a good thing, it keeps their costs down. Good in theory, bad in execution. The more people invest in themselves, the more valuable they become in the market. This drives up their compensation and accelerates their career options, while driving down their loyalty to you.
You invest more time on an exit survey than you did on them the whole time they were with your company, then try to diagnose the problem. And wonder why your best people keep leaving!
One of my favorite early leadership lessons from Warren Buffett is called the law of unintended consequences. Put simply, it says everything we do has consequences, some we intend and others we don’t. Even doing nothing has consequences. So, choose your actions carefully.
I believe we must prepare your next generation of leadership for succession success. Next week, I start sharing what you can do to help your teams succeed.