Less than 1 in 5 businesses say existing leaders are “very effective” at meeting business goals. What’s more, 84% of companies predict a shortfall of leaders capable of driving their business forward in the next five years. And all of this is taking place in the midst of a generational transfer of power. Over 10,000 baby boomers are retiring every day, whereas millennials will make up roughly 75% of the workforce by 2025.
As change abounds, it’s important to build trust, double down on leadership, and magnify the strengths that each person has to offer.
Short-Term Profits vs Long-Term Value
Corporate leaders are under pressure to deliver results in a short space of time: New research shows that 78% of CEOs have a 90-day window to prove themselves.
However, this sort of near-term time preference can be damaging to performance and brand reputation, as 76% say their business leaders cite the importance of shifting from short-term profit delivery to long-term value creation.
Nonetheless, less than 5% of CEOs successfully make the shift to a long-term time horizon.
The impetus, then, is on CEOs and senior leadership teams to develop strategies that will lead to long-term brand value creation, rather than short-term profitability. This means focusing on talent brand reputation, culture, and employee experience, which can inspire action across the business.
The Culture You Have vs the Culture You Need
Smart leaders know that culture is key to success. And so to create a culture that is authentic to your company vision and business strategy, you need to distinguish between the culture you have and the culture you need.
How does this work?
Well, leaders will often look at the existing culture and articulate an employer brand based on the best aspects of this environment. This might seem like a logical approach, but your current culture isn’t going to get you where you want to go in the future.
Instead, the real question to ask is, “What kind of culture do we need to deliver on our company vision and business strategy?”
Leaders can then identify the cultural behaviors they want to retain, remove, or introduce. This helps prioritize sustainable values and characteristics that are uniquely suited to meet the goals of the organization.
Employees at the Heart of Efforts
Employee experience impacts more than just wellbeing and retention; there’s a direct correlation between employee engagement and higher revenue. In fact, a multinational study from ADP suggests companies that prioritize employee experience can see revenue 2.5 times higher than that of competitors.
Consequently, leaders need to put employee experience at the heart of their business strategy. This means creating inclusive and supportive environments where people can find true impact, purpose, and belonging.
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Whether that means prioritizing mental health or finding new ways to facilitate remote working, leaders must constantly adapt their strategy to show up in ways that people expect.
Leaders must also increasingly focus on citizenship — that is, doing something for a reason beyond making profit. Think social responsibility, diversity and inclusion, ethical supply chain management, and more. Citizenship is especially critical given that 50% of millennials would take a pay cut to work for an organization that matches their values.
It’s no longer enough to win on salary alone. People want to know where your business stands on political, social, and environmental issues. Smart leaders need to build an employer brand where material and conscious needs are met by addressing issues of citizenship with clear, coherent and consistent messaging.
Emphasizing Learning and Development
According to the latest data, only 29% of employees consider themselves happy with the advancement opportunities available to them in their existing role. Hence, a successful leader isn’t someone that just rules from the top but uplift and inspire those around them to access elevated opportunities..
As Charlie Johnston, senior vice president of people and communities at Cisco, recently told me, “We’re working on Cisco School, which is the idea that everyone in the company, regardless of level, is actually a leader. We’ve historically said that leadership has a title, but we’re playing with the idea that leadership is going to be democratized.”
To scale a culture, leaders must design new experiences around learning, development, career progression, recognition and reward. This could mean creating support groups for the underrepresented or designing education and learning initiatives for early careers talent.
At the same time, leaders must be able to facilitate open dialogue, allow for structured feedback, take criticism on the chin, and track feedback to continually improve processes. In doing so, they can help employees succeed by creating clear pathways for opportunity, promotion, and fulfillment.
This hallmark of a true leader is not about how many followers you have; it’s about how many leaders you create.