A study reveals skills essential to effective leadership and the steps needed to develop them.
by Diana Thomas
January 24, 2010
A growing number of organizations are facing an unpleasant truth: They simply don’t have the talent they need to lead them into the future.<br /><br />Rumblings about this glaring gap in leadership talent began to surface nearly a decade ago and have grown louder and stronger over time. Fueled by real-world experiences, organizations around the globe are discovering their leadership pipeline is filled with people who are deficient in the skills and capacities needed for long-term success. Add layoffs and early retirements to the mix and industries face a potent recipe for a full-blown leadership crisis.<br /><br />How profound is the leadership talent gap, and what are the steps organizations can take to bridge it? Researchers with the Center for Creative Leadership (CCL) set out to answer those questions in a study called “Understanding the Leadership Gap.” During a three-year period, they surveyed more than 2,200 executives from across the U.S., India and Singapore to explore the factors most critical for present and future success and measure how today’s leaders stack up.<br /><br /><strong>The Skills That Organizations Need</strong><br />As a first step, study participants were asked to rate the importance of 20 key leadership skills and perspectives.<br /><ul><li>Balancing personal life and work: Balancing work and personal priorities so that neither is neglected.</li><li>Being a quick learner: Quickly picking up new technical or business knowledge.</li><li>Building and mending relationships: Responding to co-workers and external parties diplomatically.</li><li>Compassion and sensitivity: Showing understanding of human needs.</li><li>Composure: Remaining calm during difficult times.</li><li>Confronting people: Acting resolutely when dealing with problems.</li><li>Culturally adaptable: Adjusting to ethnic and regional expectations regarding human resource practices and effective team processes.</li><li>Decisiveness: Preferring doing or acting over thinking about the situation.</li><li>Doing whatever it takes: Persevering under adverse conditions.</li><li>Employee development: Coaching and encouraging employees to develop in their careers.</li><li>Inspiring commitment: Recognizing and rewarding employees’ achievements.</li><li>Leading people: Directing and motivating people.</li><li>Managing change: Using effective strategies to facilitate organizational change.</li><li>Managing one’s career: Using professional relationships, such as networking, coaching and mentoring, to promote one’s career.</li><li>Participative management: Involving others, such as by listening, communicating and informing, in critical initiatives.</li><li>Putting people at ease: Displaying warmth and using humor appropriately.</li><li>Resourcefulness: Working effectively with top management.</li><li>Respecting individuals’ differences: Effectively working with and treating people of varying backgrounds, culture, gender, age, educational background and perspectives fairly.</li><li>Self-awareness: Recognizing personal limits and strengths.</li><li>Strategic planning:Translating vision into realistic business strategies, including long-term objectives.</li></ul>Researchers found the results were consistent, regardless of the country, industry or organizational level of the respondent. Executives from businesses, government agencies, nonprofits and educational organizations all agreed they need the same thing: leaders who can effectively navigate complex, changing situations and get the job done.<br /><br />Eight key competencies were determined to be particularly critical to future success and ranked in order of significance:<br />1. Leading people.<br />2. Strategic planning.<br />3. Managing change.<br />4. Inspiring commitment.<br />5. Resourcefulness.<br />6. Doing whatever it takes.<br />7. Being a quick learner.<br />8. Participative management skills.<br /><br />With the exception of participative management skills, respondents rated the same set of competencies critical to current success as well. The only difference was a matter of degree. The study showed each competency was expected to increase in importance over time, becoming even more critical for future leaders than for those leading organizations today. <br /><br /><strong>Defining the Current Leadership Deficit</strong><br />To measure whether today’s leaders demonstrate the skills most needed by organizations here and now, researchers asked survey respondents how individuals in their own organization stack up against the leadership competencies featured in the study. The results show the current leadership gap is broad, deep and consistent across all countries, industries and leadership levels.<br /><br />Survey respondents reported their current leadership as lagging behind in all 20 competency categories. Even if nothing were to change in the future, today’s leaders are not as skilled as they should be to manage common challenges effectively. Among the largest skills gaps are managing change, developing employees, planning strategically and managing one’s own career. <br /><br /><strong>Defining the Future Leadership Gap</strong><br />The final element of the research involved determining how aligned today’s leaders are with the skills that survey respondents identified as vital to their future effectiveness. Again, regardless of the country, organization type or level of the leader, the results were the same. Today’s leaders were found to be inadequately prepared for the future. <br /><br />The leadership gap is most profound in high-priority, high-stakes competencies. In fact, the four future skills ranked most important by survey respondents were found to be among the weakest for today’s leaders: leading people, strategic planning, inspiring commitment and managing change.<br /><br />Conversely, the survey showed that many leaders exhibit strengths in areas that are not high on the list of skills needed for future success. Organizations report their greatest bench strength in building and mending relationships, compassion and sensitivity, cultural adaptability, respecting individual differences, composure and self-awareness. <br /><br />Only four areas were considered on track, with the current level of strength matching the level of importance: being a quick learner, resourcefulness, participative management and doing whatever it takes.<br /><br /><strong>Bridging the Gap</strong><br />The most effective organizations will use this information to adapt and refocus. Here are five common-sense steps learning and development departments can use to bridge the chasm between current leadership talent and future leadership needs.<br /><br />1. Perform a needs assessment for the organization. Evaluate the challenges an organization faces and identify the specific capabilities managers need to be able to meet them, both today and in the future. <br /><br />2. Create a leadership strategy. Discuss and clarify strategy to identify, develop and retain leaders with the capabilities the organization needs. One way to do this is to use leadership gap assessment data to fuel a vital dialogue about whether an organization needs to evolve its corporate culture, modify its leadership development curriculum or change its hiring practices. Those discussions serve as a launching pad for a new global leadership model that links people to performance, breaking down organizational silos and creating a common understanding of what it takes to work effectively and collaboratively across boundaries.<br /><br />3. Develop specific goals and tactics for individual leadership development. After creating a leadership strategy, determine how to bring that plan to life and target energies and investment. A learning and development department may need to teach strategic skills, define and encourage rotational assignments, create a forum managers can use to exchange creative ideas and solutions or pursue other effective tactics for developing a leadership team.<br /><br />4. Create systems. Determine whether the organization possesses the underlying systems and processes needed in order to excel at recruiting, identifying and developing talent, retaining top employees and managing performance management. This may include revamping job descriptions, changing where and how recruitment is performed and developing a new incentive plan more closely aligned with a firm’s strategy.<br /><br />5. Evaluate. Routinely measure how efforts are paying off across the organization. What additional resources are needed? What metrics are in place to assess impact? <br /><br />There is no doubt the leadership talent gap exists and there is no time to waste in bridging it. Knowledge is the first step. So take the time to identify the specific gaps in leadership capacity that the organization faces. Doing so can bring a new focus to hiring and development decisions, improve the return on talent investment and help to achieve breakthrough performance.