The 10 challenges facing today’s leadership teams
It’s tough at the top of an organisation. Sure, the view is better, you can see a bit farther – but the air is thinner. It’s colder. And often lonely.
Our work with top teams suggests that they are facing a period of unprecedented challenges, here are some of them:
1. Running the business and transforming it
The need to drive top line growth and operational efficiency yet at the same time, transform the business into a more agile, consumer focussed organisation.
2. Trying to reduce complexity in an increasingly inter-connected, volatile world
Companies today, on average, set themselves 6 times as many performance requirements as they did 50 years ago. Back then, CEOs committed to 4 to 7 performance imperatives; today they commit to 25 to 40 (Reference: BCG Perspectives, 2011). Most of these requirements are deeply inter-connected and some are even in conflict.
3. Managing membership of multiple teams
Every member of a top team runs their own directorate. They are also members of other cross-functional teams. Many often undertake a non-executive directorship. Managing memberships of multiple teams can be a real challenge for executives. Those that do it well have a mindset of ‘Leading out’ from the top team as opposed to ‘Reporting in’.
4. Consumers and employees demanding greater transparency and more authentic conversation
The 2015 Edelman Trust Barometer found that countries with higher trust levels overall also show a greater willingness to trust new business innovations. Consumers and employees, particularly new generations in the workforce now demand an unprecedented level of transparency, immediacy of communication and trust. And they have powerful ways to protest if they don’t get it, which can damage an organisation’s reputation.
5. Balancing family needs with significant travel and business demands
Many executives are ex-pats whose family have travelled to a different country with them. Be it settling children in new school or supporting a spouse in establishing themselves in a new community, these are responsibilities not often talked about in the boardroom that can put a tremendous strain on executives. Their ability to renew their own energy and create the capacity to do work is key for survival.
6. Rapidly increasing virtual and remote working
Whilst most headquarters will have an executive floor, in our experience it is very rarely fully occupied. Conference calls, telepresence, virtual meetings are the norm – requiring a different quality of engagement and personal focus.
7. Managing a multi-generational workplace
Lynda Gratton’s (2011) research on the future of work predicts that over the next two decades, many companies will have potentially 5 distinct generations in the workforce. She argues that generations fight for a number of reasons: they don’t understand each other, they have differential access to resources and power, their working style and use of technology is in conflict, or they are not really sharing knowledge and experience with each other. It is the job of the top team to lead this inter-generational workforce and create a competitive advantage from it.
8. Senior leadership teams are typically not as diverse as they could be
Be it gender balance, race or the balance between extraverts to introverts – the reality is that most top teams are not as diverse as they could and should be. Our experience in working with those teams that have managed to create diversity in membership suggests that they are either brilliant or terrible. There is no middle ground. The differentiating factor is the extent to which they have built capability to lead inclusively – lowering the cost of speaking out and raising the cost of silence.
9. Executive development is mostly done at the individual level, not collective
Many companies have exquisite high potential programmes, designed to accelerate the development of those that have been designated as having the potential to become future leaders of the organisation. We don’t take any issue with this – but we do take issue with the fact that in most organisations – development is done at the individual level, not collective. Executives are groomed for individual brilliance. When we look outside business to those high performing teams in the health service, military and competitive sports – they all have one thing in common: they train together.
10. The major challenges are not in the individual parts but in the interconnections between them
We work with very few top teams where the individuals are not exceptionally talented. They have worked seriously hard to get to where they are. Consequently, we often find situations where a team has brilliant individuals who are collectively, average. We believe that the challenges lie not with the individuals, but in the space between them, their stakeholders and their extended leadership teams.