Rebecca Ray, Senior Vice President at The Conference Board and co-author of the report is of opinion that “Building a culture that supports engagement, employee training, leadership development, and high performance is something companies can control, and is making the difference between growing market share and simply surviving in 2014. Moreover, if the focus of individual companies is sustained, Human Capital may well be the engine that revives economic growth.”
The CEO Challenge 2014 findings also emphasise the importance of management performance, with improving leadership development programs – now ranked fifth globally and up five places from the previous year’s survey. European CEOs placed this at number one when it comes to strategies for building human capital.
For most participating CEOs the focus is on developing what is already in place, with nine out of the top 10 human capital strategies focusing on current employees, including providing training and development, raising employee engagement and increasing efforts to retain critical talent. Mirroring this, the creation of a strong internal talent pipeline (or in our view talent waves) rather than seeking to recruit externally is considered a priority.
According to de Vries and Korotov (2010) leadership development cannot happen by chance if the standards of excellence and versatility for mastering today’s complex business environment are to be achieved. Many senior executives still hold on to the idea that the Human Resources department is primarily responsible for developing their organisation’s future leaders. Leader development efforts that produce the best leaders are those in which senior leaders plan the initiative and take an active part as coaches, mentors, teachers and role models. Effective leadership is not just an event – it is an on-going journey for both emerging leaders and senior management.
According to Van der Merwe and Verwey (2012) organisations have traditionally focussed on developing individuals so that they can become better leaders, which gave rise to the concept of leader development. They are of opinion that it does not make sense for organisations to only focus on developing individual leaders. There is a growing recognition that the emphasis should be on developing leadership as a collective. They envisage that the future might very likely be about developing leadership communities and networks of leaders.
In our view, nurturing leadership talent should not follow a “one size fits all” approach, but rather a “fit for purpose approach” which work on an inside-out principle (e.g. intra-personal, interpersonal, organisational, and external community). The learning process must be collaborative in nature and include a development philosophy that allows for formal learning that is supported by reflection, coaching / mentoring, as well as action learning, in order to create sustainable and transferable learning application in the workplace.
There is no doubt in our minds that nurturing of the right leadership talent is a key priority for organisations. It is concerning however; in how many instances leadership development happens by chance and still follows a “one size fits all” approach. Data about employees becomes talent intelligence when more than just administrative information about an individual is gathered and stored.
Nik Kinley and Shlomo Ben-Hur (2013) are of the opinion that the challenge most companies face is that their information about talent does not always provide the required intelligence when it comes to hiring, developing and promoting people. According to them, talent intelligence is the understanding organisations have about the skills, expertise and qualities of their people. Companies can only make good talent decisions if they know what they need, what they have and what is available.
Talent intelligence will therefor enable organisations to make deliberate choices about pro-actively attracting the right talent and developing this talent to address current and future needs and requirements. Talent intelligence will also increase organisations’ effectiveness with navigating leadership talent through the various transitioning phases pacing individuals’ readiness for placement for the shorter as well as longer term.