Leadership has emerged as the second most important challenge for companies globally, according to the Global Human Capital Trends 2015 study by Deloitte. Only six percent of organizations believe their leadership pipeline is “very ready”, according to the study. This staggeringly small number reflects on the need of organizations to invest strategically in this area. The criticality of this is also going to increase because of the changing nature of work, and evolving expectations from leaders.
In such an uncertain environment, businesses cannot possibly have clear roadmaps, but what leaders need is to have a clear sense of purpose, be agile, responsive and innovative, in order to build the capability of leading a diverse multi-generational workforce, dominated by millennials. By 2025, 75 percent of the global workforce will be millennials, and this 75 percent of the workforce will have different expectations than usual. To give an example, for 25 percent millennials, seven months of work define loyalty to an organization, according to a generational divide study by Ultimate Software and The Center for Generational Kinetics. Henceforth, it is important that the future leaders build leadership capacity for the future workforce.
Volunteerism at workplace
“People, like volunteers, want to serve an organization for a limited time, and it is the purpose and vision of the organization that attracts them,” says D Shivakumar, Chairman & CEO, Pepsico, India Region. For leaders, it is important to have a clarity of purpose of the organization, and then to communicate it to the workforce. If the purpose and vision of the organization resonates among people, then they feel empowered, develop a greater sense of belonging to the organization, and are motivated to work. And even if people decide to leave, they will always be great ambassadors and/or will decide to come back.
It circles down to having an ‘ask and inspire’ leadership style, where leaders role model the behaviors and change they expect to foresee in their workforce, and facilitate a flat, open and transparent culture where people are empowered to engage in conversations, give feedback, and get their feedback acted upon.
Create the feeling of institution
D Shivakumar, Chairman & CEO, PepsiCo, India Region
It is critical for leaders to role model the behaviors of team work and collaboration in people, and create the feeling of institution in their people
Not only has the business environment changed, there is change, volatility and uncertainty even in the nature of work, and in the workforce of today. People today, take far more risks with their careers. The feeling of being a part of an institution is not something that comes naturally to many. People are inherently individualistic in nature and it is leadership that has to build the feeling of institution. It can only be done by role modeling the behavior they seek in their employees and future leaders – specifically collaboration and team work.
Having stated that, it is important for organizations to also comprehend and accept the reality behind the psyche of today’s workforce. Organizations need to think of people more as volunteers, and less as employees. People, like volunteers, want to serve an organization for a limited time, and it is the purpose and vision of the organization that attracts them. These volunteers seek a transparent, open, risk-taking environment where failure is celebrated as much as success. If such an environment is provided to them, they will be engaged and will most definitely come back; and even if they don’t, will become great ambassadors wherever they go.
The role of HR becomes really critical in creating that culture deploying the right levers. HR gives a lot more focus to achieving ‘process excellence’, and falls short on achieving ‘people excellence’ – process excellence encompassing operations and administration, and people excellence including people strategy and strategic workforce planning. And strategic implies working aligned with the business strategy. To draw a parallel of an organization with an airplane – the leadership team is the crew, the CEO is the pilot, the CFO is the co-pilot, and the CHRO is the navigator who tells the organization which direction to fly and puts it on track and that is what’s called true north in terms of the values of the company.
Developing leaders to take on the next curve
Dr. Alfredo Behrens, Professor, Global Leadership, FIA – Sao Paulo
To have distributed leadership, it is essential to unlock the potential of young leaders by exposing them to challenges that are attuned to their competencies
Positive leadership has remained the same since time immemorial. So has the development of fledgling leaders within an organization. To develop leaders who are ready to take on the next curve, people have to be gradually exposed to challenges attuned to their competencies. Potential leaders should be offered challenges where they are responsible for results, guiding their own people and their own teams, perhaps even managing a budget. This type of development is critical for having distributed leadership, something which also attracts interesting people into the company.
However, self-managed teams may conceal the toxicity of poor leaders. To curb this, I would suggest allowing people to choose the team they want to work with. Granting some autonomy while developing leaders is important. Surely there are jobs to be done which can be allocated to the young leaders and then get out of their way. The challenge will unlock potential of the young leaders as well as that of their collaborators. Although encouraging the possibility of migration from team to team may expose the organization to the loss of talent to the competition, but that is not worse than holding back people who do not want to be with you. The migration to the competition might reflect better on the social allocation of talent. All organizations would get the most fitting talent.
Also, the best fit sought when recruiting and selecting is not only about skills. Orientation towards teamwork, resilience and perseverance are also desired qualities and they cannot be taught. I recommend that more effort be put into recruiting creatively, focusing the effort on environments where those qualities are likely to be more dense. Recruiting among the disadvantaged may also help organizations find the non-teachable qualities they want.
Leadership organizations outperform ordinary organizations
Dr. Ashok K Balyan, CEO of Reliance Group's Oil & Gas Business
The HR function plays a critical role in developing leaders who have competencies for the future.
Business uncertainties have been ever-present, but the intensity and impact of VUCA in the recenttimes has been unprecedented. Most of these uncertainties emerge from the outside environment and majority of companies struggle to deal with them. Forward looking companies look for opportunities in these uncertainties to drive ahead. Companies need to build a leadership team that has the ability to analyze trends in the industry early and even has the foresight to analyze future trends, and then innovate and drive business transformation.
Leadership organizations outperform ordinary organizations and HR plays a critical role in creating a work culture wherein it develops people to have leadership acumen with competencies for the future. Unfortunately HR has many times not come up to the expectation and has lacked in competence, will and ownership. To build that competence, HR leaders must talk business language and must understand all important aspects of business including finance, technology etc. Strategic partnership of HR leaders with CEO's/Business leaders would evolve only when HR leadership is able to weave this business understanding with required HR interventions to create an enabling environment where the whole organization culture is aligned with the business objectives.