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While it’s been somewhat of a cliché seemingly for decades, it turns out people really are an organization’s most important asset.
Of the things that keep C-Suite leaders awake at night, it’s not recession, globalization, labor relations or data security. Among all the scary scenarios executives might see in their sleep, a new global report found that “people strategies” ranks as the scariest.
The recently released “Global Leadership Forecast 2018: 25 Research Insights to Fuel Your People Strategy” revealed that senior executives rank developing next-gen leaders and failure to attract and retain top talent as their biggest challenges in the coming years by a wide margin. And only 14% of CEOs said they believe they have the leadership talent to execute their strategy.
Produced in collaboration among DDI, The Conference Board and EY, the 2018 Global Leadership Forecast (GLF) is in its eighth edition since DDI first published it in 1999. This year, the forecast includes data from 25,812 leaders and 2,547 HR professionals at 2,488 organizations across 26 industries worldwide.
“If you're deeply concerned about your organization's lack of leadership capability, you are in the clear majority," said Evan Sinar, chief scientist and vice president of DDI, and lead author of the GLF. He explained that the tremendous amount of data collected shows that as digital disruption continues to transform the workplace, employers face a massive leadership shortage worldwide.
“The good news, however, is that the research also reveals a clear road map of how organizations can start changing their people strategies today to excel tomorrow,” Sinar said.
The full report delivers 25 insights about corporate leadership around the world. Among these insights, six leadership mega-trends emerged:
- Digital is reshaping the workforce
- Data is creating a more inclusive, agile and fair workplace
- A diverse, purpose-driven culture defines success
- DIY doesn't work
- Finding new sources of leadership potential is crucial
- HR is losing its influence.
On the HR-influence front, on average companies excelling at people analytics are 3.1 times likelier to outperform their peers financially. But as HR's digital skills continue to lag, attempts to adopt people analytics are increasingly failing, according to the report.
Plus, in the past three years the report found that HR’s reputation has gotten worse, with more leaders now believing that HR is simply a “reactor” that executes commands rather than an “anticipator” that develops a people strategy that enables the organization's business strategy.
One of the primary challenges is that HR fails to develop digital skills on pace with technology advances, which undermines their ability and reputation to drive digital transformation across the workforce.
“Leadership, particularly in the current digital era, is of critical importance to our clients,” said Adam Canwell, partner, people advisory services, Ernst & Young Australia. “It is a top agenda item for CEOs and boards, who are looking for insights on how to embrace disruption to connect people and possibilities.”