Australian Leaders Not Keeping Up With Changing Expectations

Six Degrees Executive (SDE) has recently released research on ‘The Future of Leadership’ in Australia and found what we expect from our leaders, at all levels, has changed. Tech disruption, the rising importance of a values-based culture and an acceptance of the differences between Gen X and Millennials, mean that the leadership styles that worked in the past, won’t necessarily work today.

At SDE we collectively interview over 10,000 candidates a year, which means we're privy to confronting information about the state of an organisation, the capability and impact of its leaders, the quality of development programs and the health of the leadership pipeline. The results we have uncovered are confronting, although given the information we are privy to, I personally did not find them surprising.

We've learned that so often people leave an organisation not because their salary isn't right or the fridge isn't fully stocked or even that their gym membership is not fully paid for, but because of a real disconnect that occurs between that person and their leader or the leadership of an organisation.

The research delves into the current state of leadership in Australia, finding significant gaps between how business leaders are currently operating and the values their employees are increasingly seeking.

Attributes that may have historically defined successful leaders, such as work ethic and a track record of success in the company are no longer regarded as indicators of a successful business leader, rather the minimum expectation.

The Leadership Crisis

Crisis is a big word and there was a lot of debate at Six Degrees as to whether it was the right word to use in this context. There are three reasons I believe this word is appropriate:

1. Only 8% strongly agree that we encourage the development of great leaders, indicating leadership expectations will continue to stay low without significant change.

2. If you think we are critical of today’s leaders, the leaders of tomorrow have been marked even harder. 92% of respondents do not feel that there is a strong pipeline of leaders in the Australian workplace. So, where’s the change going to come from?

3. Finally, my biggest concern is that only 11% strongly agree they respect the leaders in their organisation.

Understanding the Change

Our definition of strong leadership has radically changed; succeeding in business is not the same thing as being a good business leader.

Preferred traits such as team building and interpersonal communication skills saw current business leaders ranked poorly by respondents, with over a third of the respondents rating their leader’s ‘ability to communicate effectively’ as poor.

People want leaders who are authentic and focused on building the right team and culture. A culture that is flexible, diverse and inclusive. To do this, you need to be a good communicator and have strong emotional intelligence.

On top of the list for the future, and the source of much frustration now, is the need to be more creative and disruptive. This does not necessarily mean leading the innovation agenda, this means encouraging the right people to be more creative.

The Impact

The main impact? Talented team members look for opportunities elsewhere, especially Millennials. According to our research, 47% believe the consequence of poor leadership development, is a difficulty retaining talent. Of those who remain, 43% say the morale is poor which impacts both team productivity, and, in turn, the bottom line.

Then there is the reactive nature of recruitment. Most organisations only recruit when there is an immediate need. This tactic has sufficed in the past, but the competitive nature of the market and demand for top talent means businesses need to be smarter and more strategic about talent management, especially at the executive level. Organisations must put a talent strategy in place, one that is aligned to the organisation’s goals, and accounts for the skills and experience required to meet those goals.

A new standard

Talent Selection

At Six Degrees, we have gone through our own period of self-reflection about how we do things and what we offer our clients. We are mostly asked, by our clients, to assess technical aptitude or the relevance of experience.

However, our research has told us that to identify truly great leaders we should no longer judge purely on these criteria. We should hire and promote our leaders by assessing their integrity and authenticity, their team building capability and communication skills. These assessments cannot be made using just the traditional measures of success.

“The biggest gap is the lack of multi-skilled leaders. People specialise and that's what they're good at. These days, an enterprise leader has to be multi-skilled to be able to move in and out of different requirements and to make the links. Leaders today must work with pace and have the ability to transform themselves and the organisation.”

Preeti Bajaj, Vice President
Schneider-Electric

The future leader is creative and has diversified experience. Selecting leaders with diversified experience will become increasingly important as we progress. The ‘T-shaped’ example is a good representation of how this plays out. T-people have broader skills and knowledge and learn by linking different perspectives from different specialties. They are better at promoting diverse conversations that bring exceptional ideas to the surface, which in turn, encourages those around them to be creative.

Ultimately, this research has challenged us to challenge our clients about what they truly need to propel their business forward, versus what they think they need.

Leadership Development

If we follow the line of thinking, we cannot develop our leaders using the same tactics we have used in the past either. Traditional performance reviews are becoming outdated.

Instead, it’s all about mentoring and creating the right culture – a supportive, collaborative workplace that encourages brave decisions.

60% of our respondents said that a senior leadership mentor is the most important leadership development strategy.

“The younger generation are skilled in completely different careers. I’m  not going to exhaust myself in 'skilling-up' in everything that they have. I have to trust them. They up-skill me and in return I mentor them and work on their development”.

Fiona Lang, COO
BBC Worldwide

Most of our current leadership development effort and resources are spent developing current leaders, but with agreement that there isn’t a pipeline of leaders. Is this misguided?

Two-way mentoring was raised as an effective way to build leadership capability while learning from new generations. Having current senior leaders participate in this sends a clear message that leadership development is a priority.

Connecting with Millennials

Millennials currently make up 31% of the workforce and will make up the largest generation in the Australian workforce by 2025. Even more frightening is that Generation Z will be 3 in 10 workers by 2025; that’s 60% of the workforce (without even considering the Alphas –  yes, another generation!) Understanding the needs of both generations is vital.

As a society, we are not adapting quickly enough to changes in technology, nor doing enough to challenge the status quo. According to our research what we, universally, admire most in Millennials is their ability to adapt quickly to technology changes, and their ability to challenge the status quo.

What we require for the future and what Millennials bring to the workplace are perfectly aligned. We found that if organisations better utilise the skill set of the next generation they are less likely to move.

“There’s a real leadership opportunity to persuade the younger part of the workforce they can grow as the company changes… We want our people to be engaged and we want them to feel like they can see a future here."

Catherine Tanna, MD
Energy Australia

A good place to start is to challenge them to create a more efficient work environment. Millennials are not afraid of responsibility and accountability. Rather than adapting the workplace to meet their needs, let them take charge of this process, let them challenge the current way of doing things and automate through technology.

Organisations can leverage this mindset to engage, develop and retain future leaders.

How do you measure up?

Our research revealed that traditional structures and processes will not serve us in the future. We see this in our work every day. It is no longer enough to appoint leaders who are simply job proficient. The leader is not necessarily the smartest person in the room, but hires the smartest people and provides vision and inspiration for them to achieve their best.

Leadership is fundamentally changing and it has never been more evident.  Our people are telling us we don’t understand them, or we’re not listening, especially Millennials. I think it’s important for everyone to ask themselves, “how do I measure up in this day of authentic leadership?”, because that is what our people are expecting of us.

Paul Hallam

Managing Director

Six Degrees Executive

Paul Hallam is the founder and MD of Six Degrees Executive. With over twenty years in executive recruitment, Paul has managed the recruitment of high profile roles for companies such as Nike, The AFL and Village Roadshow. Paul is passionate about not only finding the leaders of today, but also ensuring there is the right framework and opportunities to build the leaders of tomorrow. Six Degrees Executive are at the forefront of working with companies in addressing the diversity problems in corporate Australia. Paul also works with local and indigenous not-for-profits with a particular focus on working with children.