World enterprise, according to growing body of research, is facing leadership crisis. Businesses are becoming too complex, too competitive and yes, too confused about the future to govern and manage effectively.
This issue of NZ Management is heavily focused on leadership because, in part, this time each year organisations like Leadership New Zealand and the Sir Peter Blake Trust promote Leadership Week. Coincidentally, new Global Leadership Forecast by the Pittsburgh-based DDI Group was released to this magazine ahead of general media distribution. Its findings suggest “leadership revolution” is needed to fix an increasingly serious global leadership problem. This tandem of events seemed like just cause to tackle the topic in detail.
An IBM global CEO study conducted in late 2009 found that half the chief executives from 60 different countries surveyed, doubted their organisation’s ability to handle the world’s increasingly “volatile and complex” business environment. And around 80 percent of them expected their operating world to become even more complex.
Now, 18 months later, DDI’s study reaches similar conclusions and worse. Leaders are not only finding life increasingly difficult, their organisations are simultaneously failing to school up sufficient next-level leaders and managers to take over.
The global financial crisis (GFC) and potent new smart technologies have combined to accelerate and exacerbate the problem. The speed with which the new information society is imposing itself is so great, and the transition to the next generation of better equipped leaders so slow, that the marketplace and society in general are confused and frustrated. People expect leaders to lead and now they are too often ill equipped.
Despite the plethora of early warnings, the world is not well prepared for the knowledge age. But then, neither was it for the industrial age. Preparation for an economic, social and environmental shift of such magnitude is understandably too much to ask, given our innate resistance to change.
But the degree of change taking place is what makes leadership so important. The differences between leadership and very competent management are rather more stark in today’s climate.
What then, should leaders be focusing on? People for one thing. The way people are led and managed hasn’t changed much in 50 years, even though their terms and conditions of employment have. More of us work from home or in some way remotely, yet human resource managers everywhere assume, for example, that young people are the most desirable and least costly employees.
Enterprise doesn’t seem to know what to do with older employees, despite the fact their numbers swell with every passing month. There are, for example, no policies or strategies for making people who have reached retirement age more productive. No moves are made to tap their knowledge and experience. Economies need leaders to think about people rather than processes in the knowledge age.
Then there is the enterprise itself. It was created for different age altogether. Wise and courageous leaders might think more proactively about new forms of organisations. Forms that would better fit the needs of different world. Organisations built, perhaps, on partnerships, alliances and more stakeholder participation and democracy.
Change has become, as the DDI research points out, the only constant in organisational life. Leaders are, or should be, change agents. The successful enterprise will become addicted to change. Good leaders channel change. Managers and teams deliver it.
The information and knowledge age is transforming enterprise at an unprecedented and accelerating pace. The ramifications of this transformation are everywhere. Leaders meanwhile are struggling to keep up. That is, on the face of it, frightening.
The problem, of course, is not insurmountable. It is question of understanding what true leadership is, what it can deliver and investing in its nurture and development. Leadership is not genetic – though some individuals are more natural leaders than others.
The evidence of need is everywhere apparent. And the greatest changes lie ahead. That tomorrow will be vastly different from today and not look anything like the most ambitious predictions is fairly certain. The future will, of course, be dominated by information and host of other re-shaping technologies.
Leaders will guide us to new destinations. They will also shape the form of the future. Enterprise and society must invest in the right leaders to ensure the ROI is what we want it to be. M
Reg Birchfield is NZ Management’s consulting editor and writer at large. [email protected]
