The Future of Leadership in 2024

January 24, 2024

Nigel Girling

Head of Professional Qualifications
Image showing a double exposure of a person and an office building with the words The Future of Leadership

Part 1: Talent Wars

Attracting and retaining good people used to be fairly simple. You advertised a job, paid a reasonable wage and loads of people applied. You short-listed, interviewed and then picked the best one.

Easy life.

But not a life familiar to most leaders and organizations today.

Thousands of organizations have unfilled vacancies in critical areas. Research conducted in 2023 by Manpower Group explored the shortage of talent across 41 countries and found broadly similar challenges everywhere. There just aren’t enough good people to fill all the jobs we need to fill.

It doesn’t take a genius to see some likely outcomes.

• Organizations will be forced to fight each other for those talented people.

• That will probably trigger rising costs as salaries become inflated for key roles – which will probably exert downward pressure on other wages to compensate.

• Individuals who know their skills are in the greatest demand will know they have leverage – and will use it as a bargaining chip.

• Leaders of those individuals may find they are less valuable to the organization than their own immediate reports – with many possible outcomes.

In less than 10 years, the percentage of organizations struggling to recruit has risen from 36% to 77% – and is broadly similar across all sectors and sizes of employer. Japan experiences the greatest shortages for highly-skilled roles at 85%, with the UK sitting 8th at 80%.

Unsurprisingly, IT and Technology skills are the area of greatest shortage, but the supposedly softer areas of collaboration, reasoning, curiosity and resilience are not far behind.

So, what are you doing to prepare and respond? If this isn’t high on your list of priorities, it should be.

Part 2) Leaders and Wellbeing

There has been a lot of talk recently on the subject of Wellbeing and Mental Health.

Most of us by now should realize the extent to which both issues affect performance, attitude, relationships and engagement. Good leaders also understand that they themselves have a very significant affect on the wellbeing of the people they lead. Indirectly, that then affects the families and friends of those individuals too. The ripples travel far.

This is not a small or insignificant issue. Nor is it something that can be relegated to the bottom of an agenda for a management meeting or simply added to the pile of things for which the HR function is responsible.

As leaders, we need to consider how our behaviour, decisions, attitudes, approach and priorities affect the people around us. Extensive research by a range of leading institutions and professional organizations such as Samaritans, The World Health Organization (WHO), the Royal College of Psychiatrists and Oxford University’s Wellbeing Research Centre has shown that causes, impacts and remedies follow predictable patterns.

A study by the WHO in late 2022 indicated a number of recurring causes of poor mental health & wellbeing in the workplace, including:

• under-use of skills or being under-skilled for a role
• excessive workloads or pace & understaffing
• long, unsocial or inflexible hours
• lack of control over job design or workload
• unsafe or poor physical working conditions
• organizational culture that enables negative behaviours
• limited support from colleagues or authoritarian supervision
• violence, harassment or bullying
• discrimination and exclusion
• unclear job role
• under- or over-promotion
• job insecurity, inadequate pay, or poor investment in career development
• conflicting home/work demands

From even a cursory review of this list, it is apparent that the majority relate to the leadership of the organization.

Why is this happening and why now?

There is no doubt that three years of a global pandemic has amplified the challenges. Many are distributed, working from home or communicating virtually. Secondly, the place of work is in transition and in several ways:

Organizations are re-engineering the way they operate

This is increasing the insecurity many feel and making the future of any individual uncertain in so many ways. The drive to reduce costs and increase returns is pushing many organizations to downsize, automate, sub-contract or relocate. Those who do not may still increase pressure on productivity and targets to compensate.

Technology is removing or reducing the need for human input to many operations

There are many job roles and skillsets which feel under threat, adding to the anxiety. The exponential growth in the capabilities of Artificial Intelligence (AI) adds impetus. Typically, it will be those in the least skilled roles who will feel the effects most and soonest. Often these are the people least well-equipped to respond, retrain or adapt. A lot may simply fall off the employee roster. Long-term unemployability is a likely outcome for many in that category.

Globalization is making it easier for organizations to get work done in lower-cost economies

Which may be good news for developing countries, but very negative for those in the upper end of the G20, who may not be able to afford to employ workers in their own home country if they wish to remain competitive.

What else is driving this?

These few root-causes are just a subset of a much longer list and are mostly at the macro level. If we bring it down to the local level we start to bring in the leadership approach and attitudes of first line and middle leaders.

Many will be pushed – and often incentivised – by their own managers to drive up productivity and reduce costs – and so the bucket-chain will continue, with each passing the buck(et) down until the last bucket comes up empty. The prevailing attitudes of senior leaders shape the approach of leaders and managers all the way down the line. They also shape the culture of the organization, its purpose and priorities. All of these issues can serve to either engage and enthuse – or to distance people from their work, team and leaders. We know that feeling disconnected alone is a major cause of poor performance and wellbeing.

So now what?

Leaders and organizations need to start looking at the longer term.

Tactics that might increase productivity and profits for a short while might ultimately sow the seeds of an organization’s demise. If the power is moving into the hands of talented employees – and believe me it is – then managing the workplace like a Victorian factory full of workers who need a job is foolhardy. Talented and capable people will migrate to more enlightened organizations and leaders and fast. They will take with them the competitive heart, ideas, energy and innovation – and probably give them to a competitor.

Organizations need to remember that shareholders are not their only stakeholder

If the frantic rush to generate returns disengages the talent and damages the health and wellbeing of the people, there will be no returns before very long.

Supply chains, customers, regulators, employees and communities all have the power to make or break an organization – and they won’t be afraid to use it.

Untrained managers cannot lead successful and sustainable organizations

The competitive organizations of tomorrow will have a cohort of trained, highly-skilled leaders who will have access to coaching and to professional development & qualifications.

The major nations who are under-performing have many similarities. A key one of these is that they typically don’t take the profession of management seriously enough. A society which recognizes that teachers, accountants, doctors, lawyers and pilots must be professionally qualified before being allowed to operate – yet thinks literally anyone can be a leader with no professional training in the role – is asking for trouble. Usually trouble quickly finds it.

2024 needs to be the year of great leadership.

Are you ready?

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