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The Changing Face Of Leadership

The Changing Face Of Leadership: 10
New Research Findings All Leaders
Need To Understand
Kathy CaprinoSenior Contributor
I cover career, executive and personal growth, leadership and women's issues.
now more than ever, they need to be able to identify and develop other digitallysavvy leaders.
Organizations with more women in leadership are 1.4 times more likely to have
sustained, profitable growth.
Part of the series “Today’s True Leadership”
Diversity and collaboration in leadership are needed today
One of the questions I hear frequently from emerging and current leaders is this: “How has
leadership changed from 10 years ago and what do I need to understand about running a
successful enterprise that I don’t know today?
A recent study attempts to address this question in a fuller way than ever before. Jointly
published by DDI, The Conference Board, and EY, the Global Leadership Forecast 2018 is
one of the most expansive leadership research projects ever conducted. Integrating data
from more than 28,000 leaders and HR professionals at 2,488 organizations around the
world, the report offers insight into the state of global leadership and provides evidencebased recommendations for organizations to change their people strategies to meet
upcoming challenges.
Evan Sinar, Ph.D., Chief Scientist and Vice President at DDI, leads the company’s global
research on leadership and people strategies, and shares with us below the key findings
from this latest study. DDI is a global leadership company that helps organizations
transform the way they hire, promote, and develop leaders at every level.
Today In: Leadership
Here’s what Dr. Sinar shares on the key findings about leadership today:
Kathy Caprino: From this study, what are you seeing as the ways in which leadership
overall has changed in the past 10 years?
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Evan Sinar: The Global Leadership Forecast 2018 is the eighth edition of the study, which
we’ve published every few years going back to 1999. As a general trend, we’ve seen a
continued slippage in leadership bench strength (ready-now leaders who can step in to
replace those who retire or move on) – in 2018, only 14% of companies have a strong
bench, the lowest number we’ve ever seen. More specifically, we’ve seen digital
transformation and the constant threat of disruption having a profound impact on leadership
at every level.
While not every leader needs to be a technical expert, leaders do need to be able to
understand the impact of digital tech on their business and more importantly, predict the
impact of technology in the future. They also need to be highly adaptable, hypercollaborative, and able to leverage data to make better decisions. And now more than ever,
they need to be able to identify and develop other digitally-savvy leaders.
Caprino: What are the 10 most critical findings of this study?
Sinar: In brief, here were 10 of the most important data points that came out of the study:
#1: CEO concerns about talent
CEOs are incredibly worried about the leaders they’ll need to drive enterprise success.
Only 14% of CEOs say they have the talent they need to execute their business strategies.
#2: Need for digital leadership skill
Digital leadership skills are becoming increasingly critical. Companies who have the most
digitally-capable leaders financially outperform the average by 50%.
#3: Why gender diversity improves profitability
The value of gender diversity continues to be proven. Organizations with more women in
leadership are 1.4 times more likely to have sustained, profitable growth.
#4: Develop leadership potential earlier
Organizations need to take a broader view of what it means to have “leadership potential,”
and start developing leadership potential earlier in careers. Organizations that extend
development of high-potential talent below senior levels are 4.2 times more likely to
financially outperform those that don’t.
#5: Value Gen X more
Most companies are overlooking the value of Gen X. As the first generation to grow up
with video games, they are nearly as digitally savvy as millennials, but also excel in more
conventional leadership skills associated with Baby Boomers, such as building talent and
driving execution.
#6: Tech leaders are failing
Four out of ten tech leaders are failing, which is the highest leadership failure rate of any
industry. The high failure rate is likely due to the fact that the industry puts little effort into
developing its leaders. In fact, 32 percent of tech leaders reported that they never meet with
their manager to have performance discussions.
#7: Senior leaders need greater alignment
Leadership is being redefined as a team sport. As companies increasingly rely on teams, we
found three areas where it’s critical for senior leaders to be aligned: energy and
development passion, future-focused leader skills, and views on company culture. A lack of
alignment in these three areas quickly derails a senior team.
#8: HR needs developed skill in “people analytics”
Using data to make decisions about people—known as “people analytics”—is becoming an
incredibly important skill for HR. However, only 18% of organizations are managing to
implement advanced people analytics.
#9: The 3 cultural shifts needed most
Organizations need to focus on three cultural factors to improve their leaders’ ability
to respond to disruption:
Inform decisions through data and analytics
Integrate multiple and diverse perspectives to drive change
Embrace failure in pursuit of innovation
#10: Do-it-yourself leadership growth doesn’t cut it
Too many organizations are taking a “do it yourself” approach to leadership development,
which usually begins and ends with giving leaders access to a generic self-study resources.
But what leaders really want is a personalized experience and the opportunity to learn from
internal and external mentors and their fellow-leaders.
Caprino: What finding was the biggest surprise and the most controversial (going against
what many believe about leadership success today)?
Sinar: One of the most controversial subjects we studied is the impact of performance
ratings. Many people dread the annual performance review discussion, which are often
focused on ratings. We found that when performance ratings were eliminated, there was a
small boost in effectiveness. However, eliminating performance ratings was tied to a
sizeable increase in leader quality and bench strength, and also led to more gender diversity
in leadership.
It’s somewhat surprising, because eliminating ratings seems to go against the wisdom of
making data-driven decisions. But what’s important is not the ratings themselves, but the
fact that many organizations replaced ratings with a conversation focused on future
development and growth. So regardless of whether you eliminate ratings, leaders should be
having more conversations about development.
Caprino: Tell us more about the findings regarding the impact of women in leadership?
Sinar: As we have found in the past, our research showed that having more women in
leadership is linked to better financial performance. Organizations that fill at least 20% of
senior leadership roles with women and have at least 30% women overall are 1.4 times
more likely to experience sustained, profitable growth.
Furthermore, the data showed about why having more women leads to better profitability.
It’s not because women necessarily have superior skills. Instead, the key is that the
organizations have built inclusive cultures that enable everyone to thrive. Organizations
with greater gender diversity reported higher levels of collaboration, higher quality
leadership, greater agility, and more likely to experiment in pursuit of innovative
Caprino: What about the decline in reputation of HR and the changes needed within that
Sinar: The biggest reason HR’s reputation is worsening is that HR professionals are
struggling to keep up with digital transformation. HR leaders lagged far behind leaders in
every other functional area on skills that are key in a digital environment, such as using
data to guide decisions and anticipating high-speed change.
Conversely, those HR professionals who are succeeding at applying analytics to their jobs
are bringing a lot of value to their employers, and are 6.3 times more likely to report having
new advancement opportunities.
The lesson is clear for HR: Gain digital and analytics skills now to boost your own career
and be seen as a more strategic and valuable business partner in your organization.
Caprino: According to the study, the impact of mentorship on success for employees and
leaders has been significant - what do we need to know about that?
Sinar: The most important lesson about mentoring is that it’s a mistake to leave mentoring
to chance. Organizations that have a formal mentoring culture have 20% lower turnover,
46% higher leader quality, and can immediately fill 23% more roles immediately. Formal
mentoring programs were also associated with greater financial success. They also enable
organizations to capture significantly more of their vital knowledge before it gets lost as
senior employees retire or leave the organization, a major and growing problem for many
Despite the benefits, only about a third of organizations offer formal mentoring. In fact, six
in 10 leaders say they’ve never had a mentor, and a third of senior leaders say they’ve never
mentored anyone. The good news, however, is that mentoring is growing among
Millennials, with nearly 50% saying they’ve had a mentor. Interestingly, Gen X seems to
particularly crave mentorship from outside their organization, which they aren’t getting
enough of.
Caprino: What is the impact of having a purpose-driven culture on the success of the
Sinar: In today’s disruptive business environment, people need purpose to drive their work
and focus more than ever. In fact, our partner organization EY found in a 2017 study that
96% of leaders said that purpose was important to their job satisfaction. In the Global
Leadership Forecast 2018, we found that organizations that operated without a purposedriven culture, or even a purpose statement, financially underperformed the average by
In organizations that at least have a purpose statement, twice as many leaders say they get
meaning from work, and their energy levels are 60% higher. In truly purpose-driven
cultures beyond simply having a statement, leaders weave purpose into the fabric of
work.These companies financially outperform the market average by 42%, and a strong
culture build on trust, loyalty, and a sense of working toward a common goal.
Caprino: What should every leader and emerging leader take away from this study that
will help them succeed at a higher level?
Sinar: No matter what business function you work in, leaders today need to understand the
impact of technology on their business. You don’t have to be a technical expert, but you do
need to be able to predict both opportunities and potential negative effects of technology.
Part of being a great leader in the digital era also depends on developing other leaders.
Success in today’s world depends on how leaders perform as a team. The unpredictable and
rapidly changing business landscape means you need to have people with a variety of
skillsets and mindsets who can quickly step in to show leadership in response to a variety
of challenges. It’s become more important than ever that part of your job as a leader is to be
a talent scout and a mentor who develops other leaders.
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