Building Confidence in Your Leadership Pipeline. Wednesday 12 th November discussion Summary

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1 The Human Age Series Talent Management Building Confidence in Your Leadership Pipeline Wednesday 12 th November 2014 discussion Summary

2 Introduction The Human Age Series is a calendar of quarterly events created for our most forward-thinking clients and associates. ManpowerGroup s global research points to four world of work mega-trends creating a seismic impact on organisations today: The purpose of our interactive events is to ensure our clients are kept on the pace with the latest developments, focusing on the impact world of work trends are having on their talent strategy. 1. Demographics & Talent Mismatch finding the right person in the right place at the right time is becoming increasingly challenging 2. Individual Choice Skilled employees have more power, unskilled employees are becoming increasingly marginalised 3. Rise of Customer Sophistication organisations are using global buying power to drive more value from suppliers 4. Technological Revolutions new ways of working increasing the importance of collaboration and coordination wednesday 12 th november 2014 talent management Rise of Customer Sophistication Theme: Building Confidence in Your Leadership Pipeline Senior business leaders from the following industries were present: Aviation, Business Services, Construction, Financial Services, Food Manufacturing, Government Services, Infrastructure, Professional Services, Technology, Telecommunications. Demographics & Talent Mismatch Individual Choice The critical impact of talent management Technological Revolutions In the Human Age, talent is receiving unprecedented recognition as a key determinant of business success. In fact, the critical impact of talent management on business growth and economic progress is forcing organisations to re-examine how they attract, develop, retain and engage employees. There is also growing consensus that having the right talent in place at the right time is the responsibility of everyone in top management, not just HR. At the same time, many organisations are facing a talent gap, with a lack of confidence in having the right people in place to become future leaders. With stalled leadership development investment in recent years, companies are now paying the price of not investing in building in a steady stream of ready-now leaders. Leadership development has now become a top priority. As the importance of talent as a crucial competitive differentiator continues to grow, business leaders and human resource professionals alike are under increasing pressure to drive business results by strategically investing in talent, particularly at leadership level. It s never been more timely to explore relevant, actionable strategies for addressing the biggest talent management challenges. ManpowerGroup I Human Age Series Commercial in Confidence I 1

3 Guest Speaker: Ian Symes, General Manager Right Management, UK & Ireland Only 13% of senior executives and human capital managers believe they have ample leadership pipelines Our guest speaker, Ian Symes opened the lunch by acknowledging that building a suitable talent pipeline is one of the biggest challenges for organisations today. Despite talent being a key differentiator in businesses, recent Right Management research has revealed only 13% of senior executives and human capital managers believe they have ample leadership pipelines. Rather than implementing a well considered talent strategy that leverages their talent, many are in a reactive mode. Yet the recognition exists that organisations that invest in their talent strategy see positive differences in the way they identify, attract and engage talent. The audience was encouraged to consider the approach they are taking to developing their own high potential talent (HiPos) and in building a talent pipeline that will create measurable business results and sustained market leadership. Ian reviewed some of the highlights from Right Management s Flux Report. (The research involved conducting 350 interviews in the UK & Ireland with 100 HR leaders and 250 business leaders). Flux Report Highlights - 62% think leadership skills are the most important to drive growth - 54% see the leaders of 2018 being promoted from within the organisation, 70% see this team as being younger than current leadership, and 66% see women taking up half of these roles - Only 13% of HR decision makers describe their approach to resource planning as largely proactive and strategic - 74% of organisations have undergone change in the last five years, 93% in the Public Sector - 72% of organisations say they are only able to plan one year ahead - 80% of line managers agree they have had to learn more and develop faster to succeed in their role - By 2018, 79% expect individuals to maintain and develop skill sets in simultaneous careers Impact of Flux Organisations were encouraged to embrace the following changes: 1) Leadership planning building strong leaders for an uncertain future 2) Resilience avoid change becoming unmanageable 3) Strategic workforce planning ensuring your workforce is up-skilled to build and deliver on expectations ManpowerGroup I Human Age Series Commercial in Confidence I 2

4 Leadership imperative All high potentials are high performers, however research has identified only 20% of high performers have high potential for advancement The importance of developing future leaders was stressed, with a particular focus on the following areas: 1. Career development organisations must create a clearer link between the ambitions of the organisation and the careers paths within that vision. 2. Talent Management to identify the future workforce and business leaders in particular, organisations need to assess their people through regular talent audits and reviews. 3. Accelerating Leader Development leadership coaching can help move identified individuals into positions of greater responsibility with maximum efficiency. Building your Leadership Pipeline Ian then shifted his discussion to high potential talent programmes and creating a steady pipeline of ready now candidates. Three Common Pitfalls in Managing High Potential Programmes 1) Confusing high performance with high potential The question was raised how many times are individuals promoted on high performance alone? Ian noted that all high potentials are high performers, however research has identified only 20% of high performers have high potential for advancement. Selection based on past performance alone is not sufficient. Excluding high performers from the high potential list is not an easy decision to make however as it often requires providing disappointing feedback to valued employees. To avoid this trap, it was suggested HR could solicit management feedback to draw up a list of high potentials and then confirm this with a multi-trait assessment to ensure accurate selection. 2) Using outdated success models Ian observed Right Management regularly encounters companies using selection criteria that is five years (or more) old. To avoid this pitfall, the audience were encouraged to define critical traits for success in key roles over a 3 to 5 year horizon and focus on only 4-7 essential characteristics. 3) Failure to create a credible, trustworthy and structured development program. When the need for succession arises, some companies are not in a position to select an individual from within their high potential pool to fill the position. ManpowerGroup I Human Age Series Commercial in Confidence I 3

5 Building leadership capacity is perhaps the most pressing strategic imperative in business today Contemporary Challenges in HiPo programmes It was acknowledged that today s high potential programmes face numerous challenges including: - Too much time is often spent managing low performers, rather than helping HiPos reach their potential. - With an aging workforce, are we being too narrow-minded in identifying HiPos? (Is the traditional view of a HiPo being correct if a 45 year old has another 30 years to give?) - Our style of work has changed. With more cross-functional teams, how are individuals assessed and identified as high potential? Is your High Potential Programme Sending the Wrong Signals? Ian then reviewed several red flags to be aware of regarding HiPo programmes: - Trying to be fair at the expense of being strategic in selecting candidates. Some organisations mandate that available slots be distributed equitably across their business units. - Providing a ladder without any rungs. High potential development is often road-blocked by promotions made as a reward for past service rather than to expand the skills of top leadership candidates. - It was suggested that having succession management talent review meetings at business or enterprise level could be useful to ensure opportunities were made available for high potentials. - An internal disconnection - Ideally, HiPo selection criteria should flow from the organisation s business strategy and vision and be driven by the leadership team. Ian concluded by confirming that high potential and succession planning can be transformative and present great opportunities for HR to contribute to the success of organisations. He put forward that building leadership capacity is perhaps the most pressing strategic imperative in business today. Throughout his presentation, Ian highlighted results from two recent Right Management research reports: Talent Management: Accelerating Business Performance The Flux Report ManpowerGroup I Human Age Series Commercial in Confidence I 4

6 Discussion: facilitated by Ian Symes & James Hick (ManpowerGroup) We often associate leaders with longevity, yet society and the world of work has changed. We could be missing opportunities from talent who want to come and go... yet could still make great leaders What do future leaders look like? The audience discussion opened by focusing on what future leaders actually look like. The question was raised when we contemplate the kinds of leaders we want, are we considering how our customer experience is likely to change in the future? It was suggested there needs to be more emphasis on customer creativity when considering leadership. The need to have relationship building skills and to be able to connect on a customer level is vital. Yet with Generation Y likely to move jobs more frequently, it may become more challenging to find those who are able to truly connect with an equally more mobile customer base. At the same time, the speed at which customer needs evolve and change was acknowledged. - Are we too busy trying to guess what future leaders will look like when we don t know enough about what our future customers look like? - Should we be thinking short-term regarding future leaders or be looking five years over the horizon? It was noted that we often associate leaders with longevity, yet society and the world of work has changed. We could be missing opportunities from talent who want to come and go from an organisation yet could still make great leaders. The pitfalls of trying to pigeonhole and be too scientific regarding what future leaders should look like was also highlighted. In some cases, over-analysis can prevent leadership selection being made from a broader portfolio of talent. Inadequate leadership pipelines When discussing the lack of leadership pipelines that exists within some organisations, attendees questioned if the issues began developing over a decade ago. For some industries, historic recruiting of entry-level talent was focused primarily on graduates. Although more organisations now recruit entry-level talent from a wider variety of sources and experience, thereby enhancing the diversity of their talent base, the question was raised - have we lost a generation of talent without the breadth now required? Others noted a previous lack of investment in entry-level talent meant that despite being in a growth situation now, they lacked a suitable pipeline to select from. For yet other organisations, it was acknowledged that their go to market strategy had changed, so a number who were previously regarded as future leaders several years ago, were no longer suitable. ManpowerGroup I Human Age Series Commercial in Confidence I 5

7 Significant leadership skills For future leaders to be agile, they need to possess breadth, possessing multiple skills, alongside the ability to adjust and be innovative It was put forward that for some industries, the key leadership skills required today, are the same skills needed in 10 years time. In addition to possessing technical skills, high potentials must also display vital soft skills such as the ability to deal with change and ambiguity and to demonstrate resilience and agility. For other organisations, the qualities of entrepreneurship and the ability to take risks were marked as being an essential part of their DNA. The question was raised if the definition of high potential has changed. For future leaders to be agile, they need to possess breadth, possessing multiple skills, alongside the ability to adjust and be innovative. To develop breadth within an organisation, it was noted that a culture of trust is needed as it involves convincing the business to take risks and promote people, despite their experience. It was acknowledged that this could prove difficult for larger businesses. Brand perception Attendees from the Public Sector discussed some of their challenges in attracting the right talent, despite the investment now being made in this area. While the recognition exists of the need to appeal to innovative people with a different skill set to those they have traditionally attracted, drawing this type of talent is proving difficult due to the brand perception that working for government services has. Regarding EVP, one attendee noted a challenge that well known brands often face: when talent think they know you, but in reality may only focus on one aspect of your business. This makes it difficult to attract much needed skills required for lesser known parts of the organisation. Developing future leaders Attendees discussed the changes that were being made to senior leadership to cultivate diversity, introduce fresh thinking and to match the innovation taking place within their businesses. Some are working more closely with younger talent who are viewed as high potential to begin development earlier in their careers, even applying principles from high potential programmes to their graduate schemes. The need to provide exposure to strategic activities was discussed. One attendee shared ideas their organisation was considering to introduce a pseudo management level, providing development opportunities to junior talent. This would involve a 6-8 month secondment, offering them a chance to see what future leadership could look like if they were to remain with the company. ManpowerGroup I Human Age Series Commercial in Confidence I 6

8 Partnering with others to share and retain high potential talent Today s youngsters are prioritising life experiences as much as developing their careers. Therefore providing the opportunity to move around not only allows talent to gain more breadth, but can also aid retention To attract and retain suitable talent, a partnership approach is being taken by some. In the Public Sector, for example, rather than expecting to retain talent long-term, certain boroughs are partnering with other boroughs to provide the opportunity to move and progress careers. The possibility of other organisations offering high potential talent the opportunity to gain wider experience by partnering with others was discussed. An attendee from a company with sister operations in overseas locations noted that sharing and moving talent can prove to be a talent drain. It was also acknowledged that in general, more talent are willing to make a transformative move by relocating to a new country rather than moving locally within the UK. On the other hand, other attendees discussed the benefits of moving high potential talent across different parts of their business (both locally and internationally). It was noted that today s youngsters are prioritising life experiences as much as developing their careers. Therefore providing the opportunity to move around not only allows talent to gain more breadth, but can also aid retention. Individual Choice - What can you offer high potential talent? It was recognised that there has been a total structural change in the workforce and individuals are exercising their personal choice more than ever before. In attracting high potential talent and developing future leaders therefore, more consideration needs to be given to what organisations can actually offer talent in return. - What quality of life experience can be offered? - What customised development programmes will be available? - How do organisations provide more work/life balance? One attendee noted, If we don t hone in on the individual in everything we do, we won t attract the best people. As the social models of living and working change, their impact on talent management will increase. The requirement for businesses to adapt to different generational needs was also put forward as a growing challenge facing HR. At the same time, the danger was raised that it s easy to presume what each generation wants (particularly Millennials), without actually asking them what they want. An attendee concluded, People need to own their own careers. It s all about allowing them to create their own aspirations within the framework of what s possible, then providing the support and mentoring to help. ManpowerGroup I Human Age Series Commercial in Confidence I 7

9 Conclusion Developing a robust talent strategy and actively creating a leadership pipeline has become more critical than ever for all forward-looking organisations Our audience was made up of individuals from a wide range of industries and organisation sizes. Not surprisingly, the viewpoints and experiences shared were equally as diverse. While building future leadership is a shared HR concern across most organisations today, it s obvious that tackling this complex challenge cannot be met with a one size fits all approach. What is clear is that developing a robust talent strategy and actively creating a leadership pipeline has become more critical than ever for all forward-looking organisations. The need for future leaders to demonstrate breadth, agility, resilience and innovation will likely become even more important as the world of work continues to evolve. ManpowerGroup I Human Age Series Commercial in Confidence I 8