Recruiting Difficulties: Is There a Global Leadership Shortage?

Today we are joined by Adam Canwell, the Global Leader for EY’s leadership offering in Melbourne, Australia to discuss their recent Global Leadership Forecast survey.

For the full results of the survey, click here.
Recruiting Daily Advisor: What are people strategies and what role do they play?
Canwell: Any effective people strategy looks at both the size and shape of the workforce. The size is two dimensional based on how many people are needed (workers, contingent workers, or even bots) and how they should be organized to create agile, cross-functioning teams.
The shape of the workforce refers to the skills, capabilities, mind-set, and sense of purpose that are needed to help deliver the organization’s strategy and compete in today’s environment. Once determined, it’s vital to translate that people strategy into an effective leadership strategy, identifying the skills, capabilities, and mind-set needed by company leaders to deliver the organization’s strategy that was laid out.
Not many organizations have a well-articulated people strategy, and even smaller numbers have a well-articulated leadership strategy.
Recruiting Daily Advisor: What is the primary reason for leadership shortages worldwide?
Canwell: All organizations are facing change, disruption, demands for transparency, and increased competition. There’s no hiding from the pervasive and rapid pace of change for every organization’s leaders and for governments, resulting in complexity. Given that scenario, it’s not surprising that there’s a gap in leadership capability. The challenge is to keep that gap small between where you are now and where you need to go.
Recruiting Daily Advisor: How can organizations address this shortage?
Canwell: Multinational organizations are so complex that each leadership position is increasingly challenging. Yet, the talent available is shrinking in several major economies.
Organizations must make significant investments in building the right leadership capability. Many invest in a tactical way—e.g., high-potential programs and mass leadership programs run by different parts of the HR organization, each business unit commissioning its own leadership program, and hiring in its own silo. The parts don’t talk to each other. So, the first point we would say is you must have an integrated leadership strategy that looks at a definition of what great leadership is and then systematically invest in a more structured, cohesive way. You must have an integrated leadership strategy to tackle the leadership shortage.
On top of not having a “joined up” leadership strategy there are two key areas that need to be focused on.  The first question is to ask yourself if you are hiring or promoting the right people. You need to identify the right people through your recruitment process. You need to hire those who have the capacity to grow so they can build new capabilities—agility is the key. You must hire for potential as much as for someone’s current capability.
Secondly, you need to create an environment where all leaders are continuously growing and developing. Most organizations are spending less on the development of leaders. In the 1970s, when you were promoted to become a general manager, you would be taken out of the office and sent on rigorous training for a month on the key skills you needed to be a successful general manager. Nowadays, you might get an e-mail from the chief executive saying “Good Luck.” It’s extremely important to offer more support for leaders as they transition into new roles. This isn’t just a training game. You need to genuinely create cultures across organizations where people are learning and developing every day, so they are open about the development process, giving each other feedback and learning from each other.
Recruiting Daily Advisor: Your research discusses purpose-driven companies. Can you explain that concept?
Canwell: Purpose needs to be a core driver of business strategy and decision making. When we refer to purpose, we are defining why the organization exists. What is its strong, compelling, and long-term purpose that addresses multiple stakeholders? It’s not just about how the organization makes money. Why it exists is what makes it viable across a wide population. For us, purpose ‘is an aspirational reason for being that is grounded in humanity and which inspires a call to action” (EY Beacon Institute).
Once articulated, purpose needs to be brought to life by leaders to build the commitment of people across their organization. Our Global Leadership Forecast survey shows that organizations need leaders to visibly bring that purpose to life with their behavior and interaction with people across the organization. That will help to drive engagement in all their employees. Engagement will lead to much greater productivity from employees, which drives much greater performance overall.
Recruiting Daily Advisor:  The research shows that purpose-driven companies outperform the market by 42%. Why is that?
Canwell: We had a lot of research before this survey that showed the value of bringing purpose to life across the organization. As mentioned before, people who work for organizations they believe in become more engaged, committed, and more productive. They give more of themselves.  Also, customers want to buy services or products from organizations whose mission they believe. If you’re loud and clear about your purpose in the market, you can connect to your customers and they will spend more money with you. The combination of more engaged employees and more connected customers drives financial performance. That’s the reasoning behind 42% outperformance of purposeful organization where leaders really bring the purpose to life.
Recruiting Daily Advisor:  In your study, you mention the importance of formalized mentoring. Can you expand on that?
Canwell: The best way to learn is to mess something up and learn from your mistake. It takes time to have that experience and to weave what you learned from that mistake into your practice. You absolutely do have to learn that way. One good way to accelerate the process is to learn from people who had similar experience before, who made their own mistakes, and who can share those lessons with you. Such mentorship is tagged with a more senior leader, but it could be someone outside the organization, or colleagues or retired, former leaders who have more experience than you have and who are willing to be open and share their experience.
Tomorrow we will continue our interview with Canwell on recruiting and leadership.
Adam L. Canwell is a Partner, People Advisory Services, Ernst & Young and a global leader of EY’s leadership offering based in Melbourne, Australia. He has more than 20 years’ experience in providing people advisory services to clients. He has delivered transformation programs across multiple product and service industries – working with FTSE 100 (or their equivalent) organizations. Adam has an MSc in coaching and consulting for change from HEC at Oxford University and an M.A. (Oxon) Politics, Philosophy and Economics from Oxford University.

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