2018 saw the departure of a well-known CEO of a large listed company. Irrespective of the reasons for the departure, what is more interesting is the supreme control and command this individual had over his business empire, and the many issues this micromanagement caused. This style of leadership is no longer fit for purpose in the 21st century.
Many of the characteristics associated with CEOs – authoritative, forceful, dynamic, male, overpaid, powerful – belong in the past. The role of the CEO needs reinventing. The forward-looking CEO needs to lead in a more collaborative and emotionally intelligent way to achieve a sense of purpose in a world of uncertainty. This, critically, will enable leaders to deliver improved financial performance.
With increased regulatory scrutiny around conduct, CEOs must represent their company’s integrity and values. The leaders of today need to reflect the times and should look to the leaders of tomorrow to understand what is driving this profound cultural shift and what they can do to address it. Furthermore, the changing demands and expectations placed on CEOs speaks to a new workforce – something that HR directors need to grapple with, to work with the CEO to develop a people strategy which integrates into the corporate strategy, helping them to engage, attract and retain the top talent who can lead the organisation in the years to come.
Some of the most revered CEOs in corporate history have been very poor leaders. The characteristics that have brought plaudits are often incompatible with leadership. This is not a recipe for success in today’s more considered and inclusive environment. It is also not compatible in a workforce that increasingly values collaborative work, something critical in today’s globalised business world. Responsibility now expands over state boundaries. Accountability lasts for years through clawbacks and can be down to the activity of someone five layers down in your organisation. CEOs need to work closely with colleagues to fully grasp all the work streams being undertaken.
Inclusion is a vital tool to engendering a feeling of purpose. A little bit of humility goes a long way. Employees will respond positively to CEOs who admit that they are not always right and need help to succeed. Leaders need to learn when to balance decisiveness with togetherness. Inclusion is the natural bedfellow of diversity. By encouraging collaboration and bringing diversity you are going to get better results. Strengthened bonds between colleagues brings greater retention too.
Work-life balance is becoming more important. The leader who addresses this challenge will really stand out. Millennials prize work-life balance more than previous generations. Change is coming but the pace of change will be determined by how forward-looking today’s leaders are. Each business needs to ask themselves how they are going to attract future leaders.
How are leaders to adapt? It will not be easy as habits are deeply ingrained. First, they must commit to being better. Behavioural change is hard, and any leader must be willing to be coached. Leaders should also work in tandem with their HR director to identify and coach the company’s future leaders.
Leadership of tomorrow is about mentoring and inspiring others. It is about giving staff a sense of societal purpose. It is about listening and reflecting shared beliefs. There is so much hidden value stored in an inspired leader, and so much value destruction in a poor one, that it is essential that businesses invest in the leadership of today and tomorrow to future-proof their business.
Sally Talbot is HR practice leader at Per Ardua Associates