The New Reality - Developing Leaders is Key

A couple of years ago I attended a group breakfast hosted by Stanton Chase, an International Executive Search firm with its global headquarters in Dallas, Texas. The firm's global chairman, Steve Watson, is a longtime friend and business associate.

The purpose of the meeting was to present the results of a survey that was conducted by Stanton Chase and Birkman International to define the driving forces behind and status of the emerging shortage of executive leaders, engaged managers and skilled workers identified by McKinsey & Company more than ten years ago when they forecast that there would be a major "War for Talent" in the years ahead.

The report, based on a statistically valid sample of 37,000 executives and managers provides insight into the facts that are impacting the leadership ranks of all organizations:

·        The average tenure of a manager or skilled employee with their organization is less than four years in 2008 (compared to 15 years in 1980 and 10 years in 2000)

·        Over 54% of the individuals in the survey believe there is a significant shortage of quality leadership talent in the workforce at the present time and another 40% believe there will be a shortage in the near future. This indicates that over 90% of business leaders believe we have or will soon be facing an overwhelming shortage of individuals to fill key roles in our nation's businesses.

·        Almost half (48%) of the respondents believe that their organizations are significantly affected by this shortage at the senior management level in their organization.

·        Interesting is the finding that only 32% of the of the organizations, represented by the respondents, appear to be significantly concerned about the issue and about 25% of the respondents indicated their organizations were not concerned.

·        Approximately 36% of the respondents indicated their organizations are not prepared to deal with the emerging reality of the war for talent and another 49% are only 'moderately' prepared to deal with the issue.

This indicates that, while there is an overwhelming recognition of the battles ahead to hold, develop, and acquire needed talent, more than 85% of the organizations are not prepared to deal with the issue!

The report further concludes that nearly one third of the respondents believe their organization's leadership does not understand what needs to be done to attract, develop, and retain the new generations of employees who will fill leadership and skilled worker positions.

The report also reveals that more than 50% of the respondents indicated their organizations do not have 'talent acquisition maps' to guide their succession planning and major recruiting efforts. (A key question every board member should be asking)

Leadership Development

As we listened to the presentation and read the report, we were most interested in what was presented concerning the development of leadership within organizations. Surprisingly, the respondents representing 60% of the companies in the survey reported that their organizations have not implemented an adequate leadership development plan. We find this situation shocking which indicates to us that organizational leaders 1) don't recognize the need for such leadership development, 2) don't know how to develop such a plan, or 3) don't care about the future of their organizations.  Of considerable interest to us was the finding that the survey respondents believe the organizations' top needs include:

·        Identifying potential leaders and developing them (67%)

·        Retaining employees (54%)

·        Career management (51%)

·        Attracting new leadership or management (48%)Executive coaching (47%)

·        Team building (46%)

·        Hiring and selection decisions (45%)

The survey is silent with regard to the leadership development processes and programs that are in place or are being developed to address the top three needs listed above.

As the battle for talent rages with intensifying urgency, building and holding your own talent will become, we believe, the key factor in an organization's longer term success.

For several decades we have worked with organizations in the development of leaders at the team, functional and executive level. Based on our experiences we believe a strong team-oriented culture, based on a clear hierarchy of teams and a clear structure of goals, may well be the only way an organization can deal with each of the above identified needs.

If well done, this team-based culture should become the incubator from which future leaders emerge.

Copies of the "Business Implications of the New Reality 2008" can be obtained by contacting Stanton Chase or Birkman International. Thanks to both of these organizations for bringing focus to this war and giving us a clear battlefield picture of the many issues that must be addressed as our nation pursues victory and a significant role in the global marketplace, even though the findings for many leaders engaged in daily combat may not be pretty.