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Developing leaders for the organisation of the future – Roundtable Report

30 July 2015     London
Hosted by theHRDIRECTOR.
Chaired by Jason Spiller.

DELEGATES
Conrad Bester, Hr Director UK & Talent Manager – Sasol Performance Chemicals
Penny Burnett, Head of HR – Volkswagen Group
Dr Sian Christina, Organisational Development Consultant – Imperial College
Michelle Billington, Head of Transformation & Culture – Veolia
Kosta Christofi, Senior Manager: Management/Leadership – Santander UK
Rachel Dalziel, Group Head of Talent Management – RSA
Kerry Evans, Head of HR – Carpetright
Victoria Basham, HR Manager – Lorne Stewart Plc
Phil Kenmore, Global Markets Director – Hay Group
Tania Lennon, UK Head of Leadership & Talent – Hay Group
Rose Lundie, Head of Leadership Development – National Trust
Dolina O’Neill, HR Business Partner – Barclays
Michael Woodhall, Manager, Leadership Development EMEA – Ford Motor Company

The fact that leadership needs to change is taken as read, but are organisations providing the foundations, support and development to make leaders future ready? The workplace is providing opportunity and challenges in equal measure. The demands of leading in a Volatile, Uncertain, Complex and Ambiguous world, the business imperative to increasingly operate internationally and the multi-generational workforce requires innovative and agile approaches to leadership development.

Leaders are under increasing pressure to make quick decisions and respond fast to change and demands at a time when businesses are operating in an increasingly transparent environment where scrutiny is intense. This demands that leaders operate consistently with an unstinting dedication to maintaining values and efficacy, to successfully manage the complexity of today’s matrix organisations. Linear career progression is also no longer relevant, as longevity of service cannot be relied upon, posing the question; how do you hold onto your future leaders, to ensure you see the return on your development investment? In such a dynamic and complex environment, there has never been more pressure on organisations to critically review how future leaders are identified, developed and retained.

In recent times, media attention on leadership has exposed the failure of some, which has fuelled unremitting negative media coverage. How damaged is the ambition for leadership, particularly in the eyes of young people entering the workplace and embarking on a career?

Kosta Christofi: It is certainly true that many institutions and organisations seem to have lost the trust of the public, and as an organisation, we are committed to redefining the values we live by, in order to really earn the trust of all we serve. The desire and appetite for true trust has to come from the very top in order for it to cascade right through any organisation. I see this commitment to real action at all levels of our leadership.

Dolina O’Neill: Values are hugely important and it’s all about working hard to regain trust and yes, it does start with your leadership, making that commitment and investment day-to-day, and to role model these values; respect and integrity. This too is key to attracting talent who embody these values. That’s a huge focus and opportunity for us as we embed that.

Ambition and reward, are key drivers of performance, is it really true that the new gens, unable to get on the property ladder and some with student debt, are otherwise motivated?

Phil Kenmore: There are changes in culture of course, but the new Generation does have expectations of career progression, and they can struggle with matrix organisations, where you may have to do sideways moves, and you may have to take time to learn different experiences that aren’t seen as leader progression. But unquestionably, they do have ambition. One challenge for most organisations is how to manage all the different generations in the workplace, and how to support leaders and managers to understand the needs, expectations and potentials in the different age groups. That I’m sure will be a key aspect of our discussion today, leadership capability that has a breadth of styles and skills and the ability to be agile. Yes leadership has been tainted as an ambition, but in my experience, most businesses are optimistic and determined to support good leadership and develop it for the future.

The other element that identifies gen y is that it is predicted that it will change jobs multiple times, not ideal for long term leadership development.

Michael Woodhall: At Ford, we have long had a “grow your own” approach, so we have recruited people who we think will want to stay and typically they do stay. Key to the strategy is to always demonstrate the opportunity for high potential people, to take on different roles and have different experiences, and this is an area where we have been particularly active and our levels of attrition are manageable as a result.

Sian Christina: Cultures are different and so are perspectives, whether that be because of age-group, or indeed background. That reality is no different today than it was in the past. The big difference now is an awareness that quality and potential is there to be developed regardless of that. Businesses are much more aware of the potential of building and supporting diversity and providing equality. I think there is still a case that people are promoted on the basis of performance, and that is only one aspect of leadership potential. Not all high achievers are good leaders, and that I believe was causal to problems in the past.

Michelle Billington: Values must be at the heart of strategy. As an organisation, we’ve had a lot of change, and our values have helped build resilience during this. Of course, anyone can live a company’s values on a good day, but the challenge is to be able to demonstrate them on those tough days. Good leaders are the ones that are not autonomous, and are constantly looking to improve to maximise their impact.

Conrad Bester: Leadership is not – to coin a cliché – a “one-size-fits-all”, and we must guard against broad generalisations in the identification and development of employees with the potential to reach executive leadership levels. The approach should be different for different generational groups – older employees tend to be more organisationally committed to a specific employer, whereas younger employees will move more easily to different employers to achieve such career objectives. That does not mean they are disloyal, or using you whilst working for you. Leadership Development must note these different approaches and offer opportunities that will optimise the talent.

Rachel Dalziel: We are focused on succession planning and have a potential model right across our workforce. For me, a key lesson learnt is to make leadership fully-inclusive, and for organisations to equally support and develop future potential leaders, whatever their background.

Penny Burnett: Giving our leaders the space to think in leadership roles about the future is a challenge, when we all operate in a very targetdriven environment.

Rose Lundie: At National Trust there’s a strong commercial arm to the organisation and then a strong conservation arm and the needs and ambitions of the people can be quite different. A common factor though is once people join the Trust they tend to stay, our retention is pretty high. We have been focusing a lot of our time on succession planning and identifying potential and we now have about 85 percent of our employees with a ‘potential’ rating. We are spending time helping our managers have really good career conversations with employees, better understanding of what direction they want their career to go in and what skills they have that are transferrable.

Tania Lennon: Our 2030 research looked at how leadership will change in the future and the research suggests that leaders will increasingly have to build personal loyalty, so it’s less about the engagement people have with the brand, the centre of the organisation and more about their immediate experience with leadership. And that’s also where the values really come in. Do I see the people around me really living the values? Are they part of a coherent whole that I can identify with? We’re starting to see that trend. Also we did some research with one of our partners, Talent Q, hich found that 69 percent of graduates think they will be promoted on the basis of their technical skills. They discount the value of soft skills, the listening, the leading, the motivating. It makes you think about the models they are observing around them, and it also means it’s a lot harder when it comes to developing leaders and spotting people who have the potential and the talent, just getting them to understand the role of a leader and what it means in terms of skills and capabilities.

What are the significant trends and changes in business and the workforce that are affecting organisations of the future and what are the implications of this in how future leaders are being identified and developed?

Phil Kenmore: The challenge is to move away from thinking about today or indeed the next quarter, or the next year, and really visualising the business in ten years’ time, the type of leadership, the type of behaviours, how the business will be effected by technology, market trends, ways of operating. Digitalisation too is key, environmental impact on businesses, and general technology change – it’s building that future picture to plan that far ahead that is crucial.

Michael Woodhall: We find that we have to really encourage people to slow down, prioritise time and to reflect on their personal mastery, their true personal values, as well as corporate values. People still perceive a lot of long-term value in this approach, and our senior management team are strong advocates of this kind of approach, having been through it themselves. Also, there is definitely a place for other types of blended learning, but I do think there is something about self-awareness, which is hard to do effectively in an online, bite-sized way.

Kosta Christofi: I think it is important to recognise that some turnover of people can be a healthy thing for any organisation; the key to success is that the turnover is of the right people and at the right time. What you lose to other organisations with those who leave you, can gain with those who come to you, should be challenged and stretched of course, and it’s making sure they are stimulated, supported and developed – helping them to drive their own personal and professional development.

Michelle Billington: Agreed, I believe a good leader and those with that potential, will ultimately be concerned about maximising their talent and strengths, and by doing this, we are able to put the onus on employees that are fully engaged for sustainability, and that deliver outputs that substantially contribute to achieving business objectives.

Sian Christina: It’s a more diverse world for sure, and leadership is very different to how it was. You don’t have to be in an office for eight hours a day. A colleague has just been on expedition to Greenland and was able to keep on top of her team back in London, so it should be easy to work in Surbiton say, just as successfully. So remote and flexible working, the new workforce realities, should not be a dis-enabler to developing leaders or indeed leaderships itself. Communication is easy and readily available to all.

Penny Burnett: We’ve done some work at Volkswagen just recently, understanding what people really want from flexible working, across the whole of the business, and actually it’s much more fundamental than just wanting to work remotely. It’s about childcare and other life realities, which are a significant part of everyone who works and wants a meaningful career.

Rachel Dalziel: Agreed, and it’s about building collaboration to making that a reality, understanding strengths and creating the flexibility for opportunities, to give somebody more of a stretching challenge on say a project, has significant wins and paybacks, and identifying growth and leadership potential can then be based on achievement, rather than just potential.

Conrad Bester: We see matrix and project organisational designs more and more, with many senior employees fulfilling multi-portfolio type roles, for example. It is, however, not just about finding the right people to do the actual job content, but also finding leaders that have, or can be developed, to suddenly change job scope and focus. The more complex a company becomes, for instance ours has a presence in 22 countries, the more you also have to deal with understanding local cultures, and you will find different views of organisational life. Leadership and succession planning needs to take all of these intricacies into consideration.

Tania Lennon: The whole idea of succession planning is fundamentally the culture to change, to become something much more dynamic. We are seeing a much sharper and bigger jump between roles, and this is particularly a result of digitalisation, forcing fast decision making, and responsiveness. So the gap between people doing those roles very well and the skills you need, widens more rapidly – the complexity is a big challenge.

As organisations increasingly adopt flatter, decentralised frameworks, career paths are no longer linear, as multi-directional movement meets the complex needs of a multigenerational workforce. How will an effective workforce structure of the future reflect this increased need for flexibility?

Dolina O’Neill: We are continuing to simplify our organisation, and we recognise that having too many layers creates bureaucracy, duplication and weak lines of communication. People can lose sight of where their career can go within these complex structures, and part of this work includes looking at what the business will look like in the future and what future capabilities we will look for in our people. What do we have in terms of capability versus what we will need in the future will help us to identify opportunity to change and bridge any gaps. When you have a flatter structure it pushes people out of their comfort zone so they have to think differently about the way they work together to be successful.

Phil Kenmore: If people are moving in a matrix then moving in a sideways or a more jagged career path, they need to have that sense of “what does success look like”. For example, if I’m in a very operational job then that actually is more of a strategy or policy role, I might be very successful today, but I could go into that job and actually fail, because I haven’t understood what success looks like, and the organisation needs to help me have the capability and understanding.

Penny Burnett: The most important aspect in all this; is about the conversations that we have with people about their future careers. Whether it’s with their direct line manager, interfacing with HR, whether it’s how we’ve assessed them, all of that needs to build a picture because the worst thing you can do is to put somebody into a role that they are just not right for. We have a lot of conversations with people to help them understand their potential and skill-set and therefore, their best fit for a role, not only for them, but for the business as well.

Phil Kenmore: Agreed, sometimes people take an upwards promotion because they think that’s what they need for career progression, but actually, often it’s their expertise that gives them their value and happiness, rather than a generalised leadership role. Sometimes that transition can be a very big shift in self-image for people, and often it’s not successful. KOSTA CHRISTOFI: That’s part of a duty of care, and I concur, it’s about manager and colleague having good quality, ongoing career conversations. My last two promotions in Santander were for roles which did not exist when I joined, and this shows we are big enough to be a major player in our sector, but also the right size to be agile and dynamic.

Two-thirds of companies say they have succession plans in place for their top tier leaders, but only 15 percent say they have strong successors ready to take on these business critical roles. How can organisations reverse this situation to mitigate against the upward trend of hiring external talent to leadership roles?

Kosta Christofi: I would like to challenge that premise to a degree – I think there’s something healthy about bringing people in from outside. There are certain things like; cost savings and a whole range of benefits with sourcing within, but I think that should be offset with a balanced approach to take in from outside.

Dolina O’Neill: Yes, it is all about balance, putting the right people in the right job, but also hiring for attitude is a very compelling value.

Michelle Billington: Now that we have brought three separate parts of the company together, we have more scope to develop successors across our company sectors, and we created Veolia University, which opens up the business to role rotation for people across the business, giving them exposure to the vast breadth and depth of the merged company. We created a new set of values, which we were due to cascade down to every level of the organisation, but the CEO took a wise decision to first focus our energy on embedding the values at senior level, delaying cascading to all levels by approximately 12 months. But when we did it company-wide, this delay really paid off.

So what about this statistic, only 15 percent of employers saying they have strong succession?

Phil Kenmore: It seems very low, but I believe it’s the ‘ready now’ part that very few organisations have in place, especially big corporates. What organisations tend to do is see a gap coming up and second the best they have to fill them, which leaves gaps elsewhere. So ‘ready now’ is actually becoming the sort of almost unattainable goal for many.

Then there is the pressures of the ageing workforce, the squeezed middle and new gens setting their own agenda.

Sian Christina: A massive challenge for us! I think there’s an element of the need to recognise that we are in for the long-term and that the succession planning piece starts with your apprentices and graduates, looking at your existing workforce requirements which then makes talent and potential spotting absolutely critical of course, but also more relevant and effective. It’s not an overnight quick fix, it’s not for tomorrow, it has to be a constant work-in-progress.

Rose Lundie: That 15 percent figure certainly resonates and we are doing a lot of work with those on succession plans – our most senior roles in particular – so we will not leave the organisation exposed should executive team members retire or leave the organisation. We are now able to assess those who are on succession plans and target their development accordingly.

Penny Burnett: We do succession planning and we have really improved over the last three-to five years with this process. We still have hotspots and we have a limited number of people available to consider. So timing is always an issue, as change is rapid and unavoidable, and always has an impact on the plan.

Michael Woodhall: We’ve tended to encourage people to take on roles outside their comfort zone to support their development, rather than follow a strict “job-to-person fit”. We have regions that are shrinking and other regions that are expanding very rapidly and, in the rapidly expanding regions, you can get that breadth of experience very quickly. In some of the shrinking regions, it is more difficult.

Rachel Dalziel: I think the question for me is, how do you create that experiential learning for people when companies are shrinking their global footprint? I wonder how I should get my organisation into a space of taking more risks on people to allow them to make those moves.

So how does the reality of the multi-generational workforce impact on how future leaders are developed, as well as how existing leaders are provided with ongoing development and support?

Tania Lennon: We pulled together a global sample of five million participants. The global was important, because my concern was, is this just a UK or indeed, a Western issue? If generations are shaped by common experiences, could we really say that China or India experienced the same? So with this database of five million, we looked at the differences in experiences of the workplace and the expectations that people have of their leaders and their work. What was really surprising was, in terms of the expectations of leaders, there were no differences whatsoever. So it comes back to the point that many of you have made that people want to be treated – surprise, surprise – as an individual. However, linking back to your question, Jason, it shows differences around career management. When Generation Z came into the workplace they had lots of really positive expectations and experiences. Then there was this big drop with Generation Y, followed by a really slow build up, until we got to the traditionalists moving into semi-retirement or retirement, and they were perfectly happy again. So we did some analysis and asked, is this really about generations, or is it about the workplace today or is it about age?

The explanation that best fits the data was age and career stage. There’s something that happens when people come into the workplace, when they are testing out different career experiences. From there they move into what Donald Super calls “the establishment phase of their career”. All of a sudden, they have decided on a career path. There seems to be a need for us to have more open dialogue about career and changing career patterns, because we’ve got less hierarchy, flatter structures, more matrix, more network structures, less identity with organisations, the decline of the importance of the logo or brand and the nature of careers themselves are changing. Therefore, the way we need to manage those is changing. The analysis suggests it seems to be particularly impacting on Generation Y and Generation X. So that just gives you a flavour for the research, I wonder if that resonates with you?

Penny Burnett: We have been mapping out career pathways. We did a survey just recently, to understand how well the career pathways had been used and we surveyed about 150 people, it came back very positively. We invested some time with our field force people last year to launch the career pathways for them, because working out in a field and being geographically remote, there’s that disconnect. Our survey suggested that investing the time in launching the programme, in talking to the field force about it paid dividends.

Michael Woodhall: Whatever stage of career people are at, again, that factor in the drive to learn and develop is the quality of conversations they have with line management. And I think it is also true that not all line managers feel comfortable having these kinds of conversation. This year we rolled out face-to-face training to help supervisors support competency assessments and development discussions, after internal research showed that this was an area of demand. One of the key success factors was the deployment of a“leaders as teachers” approach, rather than relying on external people coming in.

Dolina O’Neill: We did a really interesting exercise where a few of our senior leaders recorded examples of what a good performance conversation looks like and the importance of having regular quality conversations. This was a fantastic example of role-modelling and generated a lot of interest across the business.

Penny Burnett: It also goes back to hiring for attitude, it’s about looking for potential and fit and those straightforward conversations.

Michael Woodhall: We rolled out the latest round of support of leaders as teachers model and it’s a model that’s working well for us at the moment.

What about inclusivity and equality in leadership development? Many of the organisations around the table will be operating in countries that have a very different set of values and cultures than the UK.

Phil Kenmore: Every generation wants the same things from its leaders, much of which we have talked about today. The thing that we have experienced with many organisations when we’ve done work around diversity and inclusion is, it’s never too late, no-one’s ever too old to be helped to have a better understanding of inclusivity, for example.

Conrad Bester: If you take countries like Qatar and Nigeria, they have some form of local employment quotas, international employers based there must meet. That requires different strategies to ensure future leadership talent, than merely relocating them from elsewhere. The generations before Y are generally in a lifelong tenure with the same employer culture. Now, young Japanese, for example, are no longer focussed on being with one employer for the rest of their careers.

Tania Lennon: So there’s two points that I would pick up there. The first is around the investment in employee development. I was looking at a study in South Korea which was measuring the impact of turnover. What this found was that the investment in training and development was not a factor in driving a negative impact on performance as a result of turnover. However, in matrix organisations, turnover had a negative impact on performance, with a greater impact the more matrixed the organisation was. Given the rise of matrix organisations, it is likely that turnover will have an even greater negative effect on performance than it has in the past. This connects with the second element which is, do we actually need to think about organisations differently, addressing the fluidity around organisational boundaries, such as developing your leaders through secondments and projects elsewhere and being comfortable with the ebb and flow of people?

Is a lack of retention with gen y an issue that employers will just have to adjust to?

Victoria Basham: Balance is critical – there has been some game changers that need to be considered in succession planning. Will the abolition of the DRA create a potential for stagnation? At the other end of the scale, there is the challenge of retaining young talent into the organisation. Employer brand is crucial for the latter, but the over-all planning is about agility and innovation.

Kosta Christofi: Agreed, Gen Y is less likely to be tied in and will be off more readily than older colleagues, but it’s really important to align an individual’s career with the aspirations of the business, to stimulate their interest and inspire them to greatness for both themselves and their employer. This should be, of course, relevant for everyone across the generations, regardless of their background and culture.

When setting leadership development frameworks, what are the key considerations and the essential composite parts to meet future needs? Additionally, with delivery increasingly autonomous and digital, how can you ensure that the programmes are used correctly and are effective?

Phil Kenmore: It’s about context and I think the classroom experience is becoming much derided, but it still has its place. Counter to that, there’s also a trend that’s emerging for much more mixed leadership development. Inevitably, there’s increasingly more delivery of content online through virtual interactions, whether it’s straight online training or whether it’s actual virtually-led training. But combining this with how you build behavioural change through experience and experiential interactions is a crucial balance. I think lots of organisations are using the University concept internally, to deliver content and then utilise smaller, more focused measurable behavioural change elements, which are about experimenting, bringing people into new experiences. Bringing people together in a traditional sense, should never be completely superseded by digital content delivery. For example, I’m convinced that say, doing fairly high mass level leadership development – middle management/front line management level – provides consistency of the messages you are giving, and also allows you to tailor and personalise content to suit needs, in context.

Is leadership development going to have to be more personalised and bespoke?

Dolina O’Neill: Our Global Leadership Curriculum offers a range of leadership courses both web-based and classroom. If we are looking to create some leadership up-skilling, for a volume cohorts and up-skill on foundation leadership skills for example on; Change, Performance Management and Coaching. Not only will our leaders be up-skilled, but they have a network of peers to learn from moving forward.

Kosta Christofi: Before a manager can grow a better relationship with their colleague, I would go back a step and say they need to develop and enhance their own relationship with themselves. The leadership programmes I have introduced contains three essential stages: Stage one is your own mind-set; Stage two is about how to value, guide and inspire your team to be the best they can be and; Stage three is about translating and implementing strategy within your business. Emotional Intelligence is no longer some vague and woolly “nice- to-have” for a select few: it is a fundamental and crucial commercial skill set.

Michael Woodhall: We are doing a lot of work at the moment to change the conversation from training to learning and fully implement blended learning as a framework for all our people. A lot of success can be attributed to the level of trust that develops between peers during these offsite programmes. You do see change, you see people becoming aware of their personal triggers and being in a space to behave differently.

Rose Lundie: Our core leadership development programme is face-to-face and has proved to be very effective. We put whole teams through the programme and the leader of the team has to lead the team through three one day workshops. The team gets the opportunity to really talk to their leader about what they want from them, what they currently get from them, the shift that they want to see. The leader is expected to share more about their values and what is important to them and be far more conscious of their leadership impact. We encourage them to think about their self-limiting beliefs, what gets in the way of them being a great leader, how they can be at their best more of the time. It is not just the leader, but all the team members working through this and it needs to be constructive.

Kosta Christofi: I take my cohorts through an eight month programme together, 20 people, and the levels of trust and openness that grow over that time are incredible: a lot of them continue that community and cohort through social media, and the learning grows as the honesty grows.

With technology taking centre stage in l&d generally, what is the most effective way of providing leadership development on technology platforms?

Phil Kenmore: Organisations that are succeeding on these platforms are adopting a mix of really good learning management; balancing flexible, virtual training technology, mixed with some personal experiential learning. In terms of platforms, this is really developing pace and we’re seeing big, influential global groups successfully managing virtual instructor-led training through software like Adobe Connect, where you can have virtual training with breakout sessions and moderation. But I reiterate, you need to strike a manageable and sustainable balance with scheduling time for teams to be together. If you focus on the individual as a person, and what their learning agenda is and you’ve got the technology that supports that, so your LMS is more personalised, it allows you to build curricular for the individual, and you can actually have something that is far more adaptive. Now it’s more about the journey of the individual. In terms of behavioural change, online content, practising virtually with virtual training and then some experiential sessions does work, we’ve proved it works and we’ve seen it work, but you have to plan it right for the level of jobs and, once again, for context.

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