These days, certain situations occur with an ever-greater frequency: companies often create vicious cycles in which capable leaders become overwhelmed. Those same leaders, therefore, have less time to train new leaders who can temporarily replace them in their absences. A longer-term result is that, when the time comes for a new generation to take the helm, the pool of possible successors is filled with less experienced and ill-prepared candidates. And this is all about millennial leadership.
This type of feedback loop can put the company’s central operations and strategic growth at risk and is a primary reason why organizations should devote time and resources to the development of new leaders.
The lack of a strategic view regarding the preparation of new leadership thus feeds on itself, and, in the long term, a persistent leadership gap will inevitably lead to an evident decline in the size and quality of the organization’s pool of potential new leaders.
Re-evaluate your leadership strategy before you are forced to
Gaps in leadership, even when strategic planning has been carefully thought and laid out, can lead to severe consequences and a failure to attain the organization’s goals. The absence of strategic leadership and a pool of new leaders to aid in the implementation of company goals will prevent those targets from being transformed into reality.
According to Tsun-yan Hsieh and Sara Yik, both consultants at McKinsey, many companies discover the gaps in their leadership only when attempting to execute the strategies that they had intended to put in place.
This point raises another fundamental question regarding strategy and leadership: how it is possible to develop potential candidates for leadership positions? This leads us to the question, “who will be the new leaders”?
Learn more about some of the approaches successful companies have taken to deal with this question.
Identifying leadership gaps and the need for new leaders
One possible approach is to weigh a company’s strategic options against its ability to execute new opportunities and other forms of innovative performance – in other words, the quality of its leadership. We have used some examples below from the article in McKinsey’s blog. A successful North American conglomerate routinely conducts discussions that factor in strategic and leadership issues. Any consideration of a strategic initiative invariably includes the question, “Who, exactly, will implement it?” If the company does not have enough leaders who are capable of taking on the task, the plan is put on hold.
Another case concerns the successful global expansion strategy of a human resources firm. The company implemented an initiative that included identifying the pool of leadership that would be required to drive innovative performance over five years in the areas of the execution and expansion of existing businesses.
In that case, the company evaluated its leadership gap by comparing its prerequisites with the quality of its current leadership bank. Thus, it was able to make a series of strategic decisions that identified, among other things, the need to hire and train new leaders.
>> Recommended: Leadership and motivation: 3 exercises to bring out your best
The case of a leading Asian firm
Our third and final case involves developing a route to achieve a predetermined strategic goal. The various alternatives under analysis each considered the participation of leaders to head specific projects, how many would be required, in what combination, and for how long.
This leading food company, based in Asia, aspired to maintain its dominant position in its region. The firm already had a portfolio of five established, well-positioned national brands, and it perceived at least three distinct options to achieve its goal:
- A cautious approach when launching a new brand, first through a pilot project in a similar overseas market before introducing the product in their home region;
- Focusing on its primary area of interest (China), initially rolling out and strengthening the new brand in a particular city, and then using that experience as a springboard to take the same brand to other regions of the Chinese market; and
- Develop a new leading figure in one of the regional markets, finding local points of sale and creating brand recognition, then using that opening to launch the other five brands in the long run.
What may be missing in the development of new leaders
In another article by McKinsey, Claudio Feser, Nicolai Nielsen, and Michael Rennie evaluated the four most significant actions for the successful development of new leaders.
Their research led to a recent poll by Fortune magazine in which only 7 percent of CEOs stated that they believe that their companies are building effective global leaders, and only 10 percent said that their leadership-development initiatives have a clear business impact.
The circumstances surrounding the effectiveness of a leadership development program are related to how that program is scaled, with no crucial single factor delineating the difference between success and failure. Regardless, it is nevertheless possible to identify the most significant actions in such a process.
>> Recommended: Preparing for a Difficult Conversation at Work
Key Factors for the Development of a New Leader
According to the article, there are four critical factors in the development of new leaders, each of which has some more important related actions, as you will see below:
- Focus on the behaviors that matter the most, according to the context: define the attitudes and mindset that are most important to the performance of a new leader (weight 8.1); determine what changes are necessary to a new leader’s pattern of thinking and behavior (weight 5.5); simulate strategies based on the capacities and skills required of those new leaders (weight 5.4);
- Ensure sufficient reach throughout the organization: participate in the development of new leadership across the company as a whole (weight 6.9); share the same leadership model across all sectors and levels of the company (weight 6.4);
- The transfer of learning and knowledge: Encourage employees to practice new attitudes and behaviors that contribute to the development of new and better leaders (weight 6.1); relate content to projects that require effort on the part of the participants, in such a manner that they will need to apply their newfound learning to innovative concepts and unfamiliar situations (weight 4.6);
- Reinforce changes using calls for innovation: review current leadership building mechanisms, prioritizing intervention models (weight 5.9); adapt all areas (including recruitment, evaluation and development, etc.) to the leadership model (weight 5.6); develop and maintain an updated model with the most desirable behaviors for each in-company leadership program (weight 4.9).
>> Recommended: Performance Management – Great Bosses Versus Great Leaders
Characteristics of new leaders
The current business environment involves the hiring of professionals who are profoundly connected to the use of new communication technologies and social networks: Generation Y or the millennials, and companies should remodel their concepts to maintain their engagement with their employees.
Although a particular company may see this sort of change as a shock to its standards and values, it is fundamental to make room for changing horizons, and new possibilities, and to understand the behavior of the younger generations. After all, they will be the organization’s future leaders.
Creating training programs that sensitize new leaders to the role of managers, while embracing gender diversity among leaders is an excellent way to start implementing changes to your business environment.
When it comes to adapting to the constant changes and transformations in the marketplace, you can always rely on management software such as Runrun.it. Sign up for a free trial now and start on the path to modernizing your business: http://runrun.it