Fast Forward Five Years – Leadership Development in the Future

By Shannan Simms, PhD, Principal Consultant, Organizational Change Management

VUCA 2.0 – it’s a VUCA, VUCA World.

Thinking about the future is an intellectual exercise – unless you’re a prophet, and then it’s a prediction. I don’t claim to have the gift of foresight like Nostradamus, so for me, thinking where we’ll be in five years is really about logic and scenario planning.

We know we live in a VUCA world. It’s volatile, uncertain, complex, and ambiguous. Our world is turbulent, and the scale of turbulence is exponentially greater than past generations. The more data we get, the more ambiguous circumstances appear. The more technology advancements we experience, the more complex actions become. The more we try to predict the market, the more unpredictable and volatile it seems. 

And in five years the world will be exponentially VUCA - VUCA 2.0 if you will!

We’ll see artificial intelligence, machine learning, and robot assisted platforms reshape how we do work. We’ll see the Internet of Things and big data re-shape marketing and consumer engagement, and drive continued heated debates about privacy. We’ll have almost eight billion people on this planet of which 80% are predicted to have a digital presence with upwards of 90% carrying a supercomputer in their pocket.

Who is actually doing the work will change as well. In 2017 we saw Generation Z start to enter the workforce; by 2023 they may start to assume managerial roles. Millennials currently comprise the largest percentage of the workforce; and in five years 45% of Millennial workers will be minorities. Generational composition will rise to five generations working side-by-side as Boomers and Generation X work longer into traditional retirement years. 

The world is becoming more uncertain and complex and our workforce is becoming more diverse. To successfully lead in the future, leaders, at all levels of the organization, will need to leverage two discrete, but interconnected, skills: agility and inclusion.

Agility – think, understand, and act quickly.
For leader development, the word of the day – or rather the decade – is agility. Worley, Williams, and Lawler (2014) explain in The Agility Factor that agility is a dynamic organizational capability that allows response to rapidly shifting environments. The goal is to make quicker, better decisions. This agility, as an organizational capability, starts as an individual competency. Agility is about being in an uncertain situation with ambiguous information and still being able to perform, keeping your head, and moving out against a clear direction. 

Leaders have to see around corners and move their people forward toward a goal. When the circumstances are uncertain, or the situation complex, or the data conflicting, stress increases. Leadership development needs to focus on preparing leaders on how to maintain and develop their mental, people, change, and strategic agility.

But being agile isn’t enough. Leader’s will need to engage and include diverse talent to find the best answers to complex questions, quickly; and create work environments where diverse talent want to stay and invest.


From diversity to inclusion - focusing on diversity of thought.
Deloitte’s 2018 Global Human Capital Trends research found that 78% of respondents believe diversity and inclusion provides a competitive advantage . Having a diverse executive board results in higher return on equity and higher earnings before interest and taxes (EBIT). Having a woman Board member leads to upwards of 26% growth in terms of share price, return on equity, and book value. Diversity results in more innovative ideas and 80% of workers indicate inclusion is important when choosing an employer.

We hear the words ‘diversity’ and ‘inclusion’ and can automatically think about risk, or quotas or compliance. But inclusion isn’t about programs; it’s about experience. Deloitte’s 2018 Shift Forward study found that 75% of respondents believe inclusive environments help the discovery of new perspectives. New perspectives and novel approaches are needed to address the complex, uncertain, and ambiguous situations companies will experience in VUCA 2.0.

But it isn’t just about solving the future tough problems. Employee engagement and retention are directly tied to inclusive environments; and inclusive environments are created by inclusive leaders. People want leaders and peers to display inclusive behaviors on a daily basis in practical and tangible ways.

From new hire to C-suite – it’s about the experience.
Agile and inclusive leaders are developed through experience. Being able to deal with uncertainty is a complex and dynamic process triggered by both personal predisposition and context. This process should start with the first assignment a new hire experiences. The most effective leadership development efforts follow a 70-20-10 rule. To develop agility and inclusive behaviors and skills, organizations will need to focus on experiential learning from the first team assignment (70%), supported by deliberate coaching and mentoring (20%), and reinforced by formal training and performance assessments (10%).

Could anything change this direction for leadership development?
From my perspective the only thing that could really change this direction is if we reach the era of singularity sooner than 2045; or if Nostradamus’ end of the world prediction for 2022 comes true. If either of those events happen, we’re going to need a lot of agility and inclusion to rethink leadership for the new era.


Sources
  Bennet, K., Verwey, A., & Van der Merwe, L. (2016). Exploring the notion of a ‘capability for uncertainty’ and the implications for leader development. SA Journal of Industrial Psychology, 42(1).
  Quantumrun Website (2018). What 2023 will look like. Retrieved from https://www.quantumrun.com/future-timeline/2023
  Jenkins, R. (2018). Reasons to be an inclusive leader. Inc. Retrieved from https://www.inc.com/ryan-jenkins/6-reasons-to-be-an-inclusive-leader.html
  Worley, C. G., Williams, T., & Lawler, E. E. (2014). The Agility Factor: Building adaptable organizations for superior performance. San Francisco, CA: John Wiley & Sons. Agarwal, D., Bersin, J., Lahiri, G., Schwartz, J., & Volini, E. (2018). Introduction: The rise of the social enterprise; 2018 Global Human Capital Trends. Deloitte Insights. Retrieved from https://www2.deloitte.com/insights/us/en/focus/human-capital-trends/2018/introduction.html
  Barta, T., Kleiner, M., Neumann, T. (2012, April). Is there a payoff from top-team diversity? McKinsey Quarterly. Retrieved from https://www.mckinsey.com/business-functions/organization/our-insights/is-there-a-payoff-from-top-team-diversity
  Curtis, M., Schmid, C, & Struber, M. (2012). Gender diversity and corporate performance. Credit Suisse Research Institute. Retrieved from https://www.calstrs.com/sites/main/files/file-attachments/csri_gender_diversity_and_corporate_performance.pdf
  Jenkins, R. (2018). Reasons to be an inclusive leader. Inc. Retrieved from https://www.inc.com/ryan-jenkins/6-reasons-to-be-an-inclusive-leader.html
  Deloitte website (2018). Re-defining Leadership: the Inclusion Imperative. Retrieved from https://www2.deloitte.com/content/dam/Deloitte/us/Documents/about-deloitte/us-shift-forward.pdf
  Bennet, K., Verwey, A., & Van der Merwe, L. (2016). Exploring the notion of a ‘capability for uncertainty’ and the implications for leader development. SA Journal of Industrial Psychology, 42(1)