2012 Feared to See Leadership Shortages
Many executives foresee leadership shortages in the year ahead and are looking at programs to accelerate leadership development within their companies, according to new research from Deloitte.
The Deloitte report, “Talent Edge 2020: Redrafting Talent Strategies for the Uneven Recovery,” identifies a number of significant trends driving corporate talent strategies and tracks how companies are responding to shifting economic realities.
“The standout findings from our research are two-fold: the near universal agreement about the existing and potentially growing shortage of executive leadership and the significant regional differences in talent needs around the globe,” said Alice Kwan, principal, Deloitte Consulting LLP and talent services leader.
“Talent leaders in today’s business environment are taking responsibility for their futures by focusing investments and capabilities on rebuilding and developing new talent programs for leaders and critical employees within their organizations.”
According to the report, companies seek new sources of growth in a stalled economy. In a ranking of top strategic priorities, 38 percent of surveyed executives picked improving top- and bottom-line performance, followed by expanding into global and new markets at 33 percent.
Executives look to strengthen leadership development pipelines and programs, the report added. Approximately one-third (30 percent) of executives surveyed ranked developing leaders and succession planning as today’s top talent priority—the highest of any response in the survey. Additionally, 29 percent predicted this specific issue will likely remain the top talent concern over the next three years.
As talent demands expand globally, pressure is building to create talent strategies that can both scale (for size and efficiency) and focus on regional markets: Asia Pacific (APAC) executives face urgent needs with significant shortages anticipated in research & development (68 percent), operations (64 percent) and strategy and planning (62 percent).
Survey participants in the Americas see executive leadership and operations as the main talent gaps (both 56 percent), while business leaders in the Europe, the Middle East and Africa (EMEA) region are far less concerned about shortfalls in talent.
Corporate talent programs are falling short on performance and investment, the report showed. Only 17 percent of executives surveyed believe their talent programs are “world-class across the board;” 83 percent acknowledge that significant improvements need to be made in their organizations. Executives that regard their talent efforts “world-class” are more likely to report —by margins of 20 percentage points or more—that their companies are investing in these programs at a “high” level.
Executives are aligning their talent management practices to identify and develop new leaders, create effective succession plans and build global workforces, the survey further showed.
A majority of executives surveyed say performance management (73 percent), talent assessment (72 percent) and high-potential employee development (71 percent) are core talent priorities that will increase over the next 12 months. These priorities clearly dominate new hiring initiatives across the board, including the hiring of experienced managers, new campus hires and contract/part time workers – a data point consistent with the high levels of unemployment in developed countries worldwide.
“Ultimately, building leading talent programs requires investment,” adds Kwan.
“Our research confirms that while less than 1-in-5 surveyed executives self-identified their organizations as talent leaders, more than 4-in-5 acknowledge the need for significant improvements and investments. Today’s top talent organizations are not sitting back and waiting for a slow recovery to solve their talent challenges. These executives are more likely to invest (by a two to one margin) across the board on talent priorities and initiatives.”
“Talent Edge 2020: Redrafting Talent Strategies for the Uneven Recovery” is the third in a series of “Talent Edge 2020” reports. The “Talent Edge 2020” longitudinal survey series was preceded by the “Managing Talent in a Turbulent Economy” longitudinal survey series from 2009-2010.
The “Talent Edge 2020” survey series is conducted in collaboration with Forbes Insights to identify important trends driving corporate talent strategies and track how companies are responding to shifting economic realities. The survey included 376 senior executives and talent managers at large companies (annual sales +$500 million) worldwide, across a range of major industries.