Tough at the top
Busting leadership myths
Kiwi organisations are facing a growing number of leadership challenges as they move through the 21st century.
Intense media and social media scrutiny, evolving regulatory requirements, demographic changes and demands for greater sustainability are some of the elements creating a tough new set of demands.
Then there’s the digital revolution, which has fundamentally altered the way most companies interact with their suppliers and customers.
The task for today’s leaders is managing the turmoil of the present while creating a sustainable future and protecting – or in some cases re-establishing – the identity of their organisations.
Research by Deloitte shows organisations with strong leaders are 2.3 times more likely to financially outperform peers.
Conversely, organisations who are perceived to have ineffective leadership experience a 19.8 per cent equity discount. Organisations therefore see tangible business benefits from investing in leaders, and investors notice.
The substantial impact leaders have on business performance goes a long way to explaining the size of the leadership development market. Globally, its value is estimated at $58 billion–$87b and in New Zealand it is estimated at $145 million–$218m.
But despite the large amounts of money being spent in this area, there is a significant amount of scepticism. Deloitte’s 2016 human capital survey identifies leadership as the number two concern among HR and business leaders based in Australia and New Zealand.
This signals it is a priority issue on New Zealand’s executive agenda, not surprising, considering 40 per cent of respondents stated their current leadership programmes provided only some value and 24 per cent said they yielded little or no value.
Further results from the Australasian survey respondents revealed that just 24 per cent said they were excellent at providing leadership programmes for all levels (new, next generation, senior leaders).
What’s more, 60 per cent reported they were weak in providing focused leadership programmes for millennials.
These results suggest the leadership development world continues to be dominated by myths and fads and programmes that often promote superficial solutions which appear effective, but fail to help leaders learn and do not deliver measurable results.
Looking past the latest fads, there are a few steps that organisations can take to address the leadership issue.
Build leadership programmes on a foundation of evidence:
Insights from data can help organisations identify what makes successful leaders. Rigorous analysis should inform every step of the leadership development process, including candidate identification, development, coaching and career progression.
Use robust assessment to improve the return on leadership development spend:
The usual methods organisations use to identify leaders’ capabilities and development needs are via manager assessments and selfassessments. But these are subject to bias and lack objectivity. Highperforming companies employ third parties to carry out evidencebased, in-depth profiling of leaders and benchmarking, as this allows them to accurately pinpoint skill gaps and design effective and targeted learning programs.
Take a fresh, hard look at leadership development strategy:
High-performing companies don’t just outspend their competitors on leadership (by almost four times), but they also spend smarter. They develop an integrated system of leadership that includes a specific leadership strategy, assessments to measure individual and team capability, research-driven content and blended learning programmes with stretch assignments, intensive coaching and continuous opportunities for leadership development.
Identify leaders early:
Perhaps it’s the famous ‘she’ll be right’ attitude that gets Kiwi organisations in trouble. Andy Clayton
The ability to find great leaders as early as possible is an important way to deepen the leadership talent pool and promote dramatic change. The use of evidence and analytics can identify leaders who can be ‘‘fast-tracked’’ to roles where, on paper, they have little or no experience.
Identify and foster teams of leaders:
An important goal for most organisations is to develop new models of leadership teams, combining leaders of different generations and perspectives. For many organisations this is a new focus and will be critical in the future when they will need both teams of leaders and leaders who can drive and motivate teams.
Perhaps it’s the famous ‘‘she’ll be right’’ attitude that gets Kiwi organisations in trouble in terms of developing leaders. It’s often thought that great leaders are ‘‘naturals’’ and don’t have to work at it. But that is just another myth. Leadership can be the result of a deliberate plan combined with measurable evaluation. It’s something that can be worked at, not just reserved for the lucky few who get it at birth.