DDI has recently published their 2014-2015 Global Leadership Forecast. This involved more than 13,000 leaders and 1500 HR professionals globally, report on wide ranging leadership topics. The Global Leadership Forecast has been conducted since 1999 and the longitudinal nature of the research makes it particularly unique and insightful. In The Conference Board CEO Challenge®, over 1000 CEO’s globally reported that human capital remains their top business challenge and identifies leaders and leadership as the most critical enabler. However, leaders in DDI‘s study report that they are not ready to deal with the human capital challenge! Only 27% of leaders claimed readiness to deal with this issue. This is sobering reading.
Despite significant focus and investment over the last ten years in leadership development, DDI’s Global Leadership Forecast continues to report significant gaps in the quality and capability of leaders. Only 40% of leaders globally (up marginally from 38% in 2011) report that their organisations have high quality leadership and only 2/3rd of them are confident in their own abilities to meet the challenges they are facing. More strikingly, only 25% of HR professionals surveyed have confidence in the quality of the leaders in their organisations, unchanged from the last global survey in 2011. The survey prior, in 2009, also showed such low ratings. These statistics suggest leadership capacity has stalled.
Some of this can be explained by increasing expectations and complexity but, in the end, it doesn’t matter. Leadership has to meet the expectations of the role and confront the things that both enable and impede success. In fact, there is a real likelihood that expectations will continue to rise. Critical skill areas identified include: coaching and developing others, identifying future talent, managing and successfully introducing change, inspiring others, fostering creativity and innovation and leading across countries and cultures. Leaders’ self-reported effectiveness across these areas ranges from a low of only 1/3rd rating themselves effective to a high of only 2/3rd reporting feeling equipped with the skills they need. In reviewing leadership development approaches, the overwhelming majority of leaders report dissatisfaction with their organisation's development offerings; only 37% rating the quality of leadership development efforts as high in their organisation. This suggests that we need to think differently about how we address leaders’ development needs.
Much has been written about blended learning approaches and ensuring a learning journey approach underpins efforts in this area. The data showed that organisations with high-quality development put a far greater emphasis on formal development methods and learning from others, with a lower than expected percentage being reported as ‘on the job’ learning. The feedback found that the ratio that correlated with the highest quality development is 52:27:21, with 52% on the job, 27% learning from others and 21% through formal learning methods. This contrasts to the often adopted ratio of 70:20:10, so often used as a guiding principle for the design and development of learning solutions. Given the importance of leadership in guiding development, it is not surprising to see leaders report that their commitment to staying in their roles is influenced by their experience with a development minded manager and the organisation’s approach to leadership development. Yet only 36% of leaders reported having an up-to-date development plan! Leaders also report a lack of involvement in their development by their own manager (33%), HR (48%) and senior management (46%). Specifically, a focus on growing your own leaders pays off richly. The research shows that organisations that fill a larger percentage of their positions internally have significantly higher leadership strength and financial performance than organisations that don’t.
Given the human capital challenges we are facing, leadership development and preparation should not be viewed as a discretionary activity or left to chance. It must be embraced with the same rigour that we apply to any other business process.
Other interesting topics in the DDI’s survey include a review of the changing role of HR, global vs local leadership development initiatives, and a review of the data collected from different generations, leadership levels and also between the genders. For a more detailed review of the DDI Global Leadership Forecast 14-15 and additional topics covered, please click here
Christien Winter is a Director at Sheffield, a leading HR consulting firm and the Affiliate Office for DDI in New Zealand.