Why global confidence in business leaders is declining
The quality and suitability of local leadership within both the business and political arenas has been a hotly debated topic for some time now, and of late has received much media publicity.
A recent survey by Reputation Institute, a global consultancy firm indicates that South African's are losing confidence in the leadership of the private sector. As opposed to innovation and service which ranked highly in the survey, leadership is considered to be the least important aspect of a company's reputation.
This problem is not confined exclusively to South Africa however. Globally, organisational leaders are not being given the growth opportunities to reach their full potential. Great leadership doesn't happen by accident. Organistions need to start listening to their leaders and make the right development investments if they want different results. Higher quality leadership equates to superior business performance.
DDI's Global Leadership Forecast released last year indicates that despite a heightened focus on developing leadership talent, with 75% of the executives surveyed indicating that improving leadership talent is a top priority, a mere 40% of the respondents were satisfied with what their organisations were actually doing to assist them with their growth requirements.
One of the areas where organisations are falling short is that they are not thinking long-term and are neglecting succession management in their talent development strategies. With HR professionals indicating that one in three succession candidates fail, organisations should be asking themselves whether they have the quantity and quality of leaders they will need to run their companies in three or five years time.
The ineffectiveness of current business leaders is compounded by the fact that many organisations are not in touch with the skill sets required by modern business leaders. The skill-set necessary to function optimally as a business leader has changed dramatically over the years and will continue to do so. Right now organisations should be focusing on developing leadership skill sets for the future with current leaders needing to spend more time being 'talent managers'.
Although formal training or classroom learning is effective as a development method and will always have its place in a development programme, organisations are not incorporating enough job rotations or project team assignments into their programmes which have proven to be one of the most effective ways in which adults learn. What emerges from DDI's research is a clear message that executives want more opportunities to learn on the job, allowing for networking and collaboration. Unfortunately senior management seldom takes responsibility for making this happen. This together with a distinct lack of inside coaching opportunities will hinder any attempt to create and cascade a leadership culture.
Despite having dynamic, multi-faceted leadership development programmes in place, selecting the right leaders still remains crucial. What makes a good leader as opposed to a great one, often comes down to whether the person in question is passionate about leading.
DDI's research shows that 53% of the leaders in the top three performing companies it surveyed indicated that they had the passion to lead. If a leader is passionate about what they do, they in turn will instil passion among the people they lead, making it part of a common vision.
Employee engagement and empowerment are important factors in determining organisational success. Engaged and empowered employees feel a sense of purpose and are committed to a vision. Leaders will not create this if they don't have a sense of meaning in their own roles and therefore should first take stock of their own purpose, to recognise the unique contribution they can make, taking into account that every leader has their own leadership style.
Considering it is these few people who are held ultimately responsible for success or failure and have the power to influence the whole organisation, making an investment to increase the odds of success among a small group of key individuals can hardly be seen as an expensive exercise.
There is no question that the payoff for organisations that revolutionise their leadership practices is enormous. Although South Africa can boast of many great business leaders, organisations should be thinking of future leadership and have progressive workplace-based programmes in place to ensure leadership development that will ultimately increase organisational success.
Irwin van Stavel is Senior Partner and Managing Executive at LRMG.