While the age-old question of whether business leaders are born with natural leadership characteristics or are later transformed rumbles on, analysis of the global workforce suggests that the business leaders of tomorrow will need additional skills compared to those of today.
Furthermore, a talent report compiled by business intelligence firm SHL cautions that the supply of future leaders will only be realised if organisations are serious about the need to drive development initiatives that ensure leadership potential translates into leadership success.
“Companies need to take a close look at their vision and mission objectives and identify employees with leadership potential to align with their goals,” says Stuart Hedley, business enablement director for Asia-Pacific, Middle East and Africa at SHL.
He adds that economic shifts towards Asia, social and political change, and accelerating technological and communications capabilities are driving an ever-greater demand for effective leadership. In future, he says, business leaders will need to focus more on building relationships, problem-solving, communication and responding positively to change. They will also need to think laterally and drive change while communicating effectively.
“Employers who identify individuals who exhibit key leadership characteristics still need to provide additional investment and development to realise their full leadership potential,” Hedley says. He adds that numerous studies have shown that well-led firms are those who are able to attract, retain, develop and engage the best talent – and are more likely to hit their business objectives.
To build a pipeline of leaders, Hedley says that it is vital for employers to look for ways to leverage leadership talent more effectively. They also need to put in place development programmes for those they hope to move into senior roles. According to research by the US Centre for Creative Leadership, important elements that create a leader include innate traits, experiences and training.
Through analysing a data set of 569,892 people, SHL says that globally, Hong Kong comes first in terms of leadership readiness for today. However, it drops to 20th place in leadership preparedness for the future. The mainland currently ranks outside the top 25 for current leadership readiness, but moves up to 25th place for future leadership preparation.
Across most geographic locations, banking, insurance and financial services sectors have the advantage of strong supplies of leadership for both today and tomorrow. Consumer goods, health care, telecoms and general business services are identified as weaker today, but well-positioned for the future.
Hedley says that to operate and deliver effective leaders, employers need to provide a balance of compensation, respect, empowerment, senior-leader brand recognition, ethics and integrity. “It’s really about drawing lines in the sand and putting in place the right employee brand proposition matched with the leadership talent needs of tomorrow,” he says, adding that remuneration alone rarely translates into a successful leadership and employer arrangement.
Fiona Yung, executive director at Tricor Executive Resources, shares a similar view on the future of leadership. “Companies need to have programmes in place that cover all leadership development and retention needs,” she says. “A lot of companies don’t realise the importance of leadership talent succession planning until it is too late.”
She says that in Hong Kong, multinational companies generally have better-defined leadership succession plans compared to local and family-run businesses. Still, she notes, there are multinational companies with senior leaders based in Hong Kong and the mainland who need to refer to their global head offices to approve decisions, which can diminish the sense of leadership responsibility.
In addition to grooming leadership talent and equipping them with technical skills, Yung believes it is essential to cultivate soft skills. “It is a given that any leader should have the technical abilities, but they also need to communicate, motivate and negotiate while operating in an increasingly multicultural environment,” she says.
Mark Enticott, managing director of talent recruitment firm Ambition Hong Kong, also emphasises the need for leadership development programmes. “Leadership development programmes are crucial for business to develop and move forward,” he says.
He believes that in addition to looking at their own business growth linked to leadership requirements, employers should look at wider industry developments and leadership initiatives in other sectors. He also supports the concept of sending potential leaders overseas and giving them the opportunity to learn from leaders outside their employers’ firms.
“Clear strategies that give paternal leaders the opportunity for job rotation and to develop their soft skills are an integral part of creating a pipeline of leadership talent,” he says. “When a person is promoted, companies should already have a backfill of next-generation leaders coming through and ready to move up to the next level.”