According to the 2018 Global Leadership Forecast prepared by The Conference Board, developing “Next-Gen” leaders is identified as the #1 challenge in today’s organizations.
Historically, we have come to see companies as the place where leadership development happens. General Electric, P&G, Siemens, Boehringer Ingelheim, PepsiCo, and almost any other Fortune 500 company has sent its executives to either their internal or external leadership institutes. As a result, in the business ecosystem made up of multiple such companies, there has always been a consistent supply of leaders, and the recruiting firms have built their business on finding such talent in the market.
We are already witnessing a significant disruption in the traditional business models as technology continues to evolve. I believe that disruptive technologies, the maturity of Artificial Intelligence, changing demographics, and shifts in the global balance of power will continue to challenge the conventional business models. Data already shows that “one out of three public companies will cease to exist in their current form over the next five years — a rate six times higher than 40 years ago … and only 44% of today’s industry leaders have held their position for at least five years, down from 77% a half-century ago.” (source: How to Thrive in the 2020s | Winning the ’20s | Boston Consulting Group).
As more companies become flat and have short life-spans, they will no longer be able to groom the leaders over time. Further, given the trend, the future business ecosystem will consist of only a few large companies — a situation that will exacerbate the leadership development crisis.
It is easy to hypothesize that the traditional approaches to grooming leaders from within will fail. What will then be the path to develop future leaders? What will be the rational, emotional, and political makeup of these leaders of the future? These are the questions I ponder upon daily, given my related, real-world experiences.
In my view, the future locus of leadership development will shift away from companies. Academia and individuals will increasingly take on the responsibility of developing future leaders.
One, companies will not only need to change the way they identify and develop leaders from within but also become adept at integrating “not groomed here” leaders to drive innovation, sustain competitive advantage, and survive over the long term. Further, as the pace of business increases, we will see a shortening of the on-ramping periods for new leaders. As a result, companies will have no choice but to invest in leadership coaches for these leaders to be able to perform effectively. Coaches who have both the business experience and the coaching training will be in high demand.
Two, if we agree that in the future, companies will have shortened life spans, they may no longer be the place where leadership development happens. In that scenario, K-12 Schools and Universities could become the training grounds for the leaders of the future, and shift their curriculums to become more experiential.
Three, and most importantly, each of us will need to prepare ourselves to be able to work effectively in such dynamic and hyper-paced work environments. Just like we hire coaches to help us learn swimming, prepare for childbirth, play golf, scuba dive or fly an airplane, we will need to hire coaches to navigate the work environment.
At an extreme, it is also possible to imagine that due to the radical impact of technological disruptions, particularly artificial intelligence and robotics, on organizational leadership and decision-making processes, the rubrics of leadership, as we know, today, might no longer remain relevant. What will then be the new rubric of leadership in the age of artificial intelligence? Should we train technology to lead? Would robots make better leaders than humans?