A report by the Department for Business, Innovation and Skills (BIS) last year showed that nearly three quarters of organisations in England reported a deficit of management leadership skills. And this deficit is contributing to our productivity gap with countries like the US, Germany and Japan.
Leadership is key at all levels.
Here are five trends, which will have a big impact on businesses, which makes leadership even more important in 2013:
Uncertainty makes leadership harder but more important
The economic and business environment in 2013 will continue to be unpredictable. In our global survey of 700 leaders 72% reported a high or extremely high increase in uncertainty in their companies. Organisations are introducing more change initiatives than ever -as many as five each year. Our research has found that twice as many business leaders believe that "the ability to change" is a key challenge when compared with 2010.
An increased feeling of uncertainty can lead employees to lack confidence in one another and can have a de-railing effect on change programmes.
Developing first-line leaders is key
First-line leaders make up 50-60% of management on average and directly supervise as much as 80% of the workforce. They represent the most important group of leaders in an organisation, as they are involved in all aspects of a company from strategy to customer satisfaction. Developing first-line leaders (i.e. the first level of management) must be high on a company's agenda.
First-line leaders are generally promoted to their post based on technical skills and knowledge; but it is their people skills, which determine their effectiveness and success in their new leadership role. According to CIPD research, 85% of respondents claimed there was a lack of people skills among first-line leaders. Our research shows that you should invest a minimum one-third of your total leadership development budget in these employees.
People-leadership skills are vital in all employees
Our research shows that people leadership skills (i.e. the ability to lead people effectively) are three to four times more important to a leader's career success than other skills. Better performing companies report a much higher adoption of people-leadership practices.
We believe that effective leaders should become experts in four key people leadership areas:
Thinking like a leader
Coaching a team
Getting results through others
Employee engagement is still critical in 2013
According to Gallup's 'state of the global workplace' study, organisations with engaged employees tend to have significantly lower absenteeism, turnover and accidents with productivity and profitability being much higher.
Our research has found five core engagement needs and 25 engagement factors. A leader can make a big impact on the team and individual engagement, by knowing these factors and core needs.
Learners will require more thoughtful training
Just like in the workplace, employees also need more engagement in elements of their training.
A recent Forum survey of 700 leaders worldwide found that 91% of respondents felt that they had too much work, while 75% said they had little or no capacity to do more with less. Employees do not want to attend a one-off training day when they are pushed to work at full capacity, and still manage their regular workload.
Employees will appreciate learning that is relevant, practical, and challenging; boot camp training is out.
Graham Scrivener is the managing director of The Forum Corporation's Europe, Middle East and Africa division.
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