It’s been more than a decade since the first alarm about a shortage of leaders. Who can forget the countless surveys that indicated a significant decline in the confidence in leadership bench strength, or the reports that leadership skills gaps were a top concern among talent management professionals and CEOs alike?

Common causes leading up to leadership-shortage concerns included recruiting wars for talent, the retirement of many baby boomers, changes in the nature of work, and poor organizational practices identifying, selecting, and developing talent.

Sadly, new surveys report the leadership-skills gap still exists. The concern seems to have spread further around the globe, and the World Economic Forum on the global outlook for 2015 identified the lack of leadership as the No. 3 challenge over the next 12–18 months. Out of 1,767 respondents to the Survey on the Global Agenda, 86% agree there is still a leadership crisis.

This paper shares findings from 2 research studies designed to explore the leadership gap. In the first study, we surveyed 2,239 leaders from 24 organizations in 3 countries. We found that crucial leadership skills in organizations are insufficient for meeting current and future needs.

The second study was conducted by APQC, a member-based nonprofit and one of the world’s leading proponents of business benchmarking, best practices, and knowledge management research. This study explored the potential drivers behind the continued shortage and showed that certain leadership and business trends are contributing factors to this deficit. APQC’s special report also provided recommendations for organizations that want to bridge the gap between where they are and where they need to be as they adjust and reinvent themselves.

Businesses, government agencies, nonprofits, and educational organizations need leaders who can effectively navigate complex and changing situations. Organizations need to ask “Who do we have?” and “What do they need to do?” as well as “Are they equipped to do it?”

We also conducted a research study to determine if the current level and type of leadership skills are sufficient to meet organizational needs.

The project was designed to address the following 3 questions:

What leadership skills and perspectives are critical for success, now and in the future?

• How strong are current leaders in these critical skills and perspectives?

• How aligned is today’s leadership with what will be the most important skills and perspectives in the future?

A leadership gap or deficit may have one of 2 causes: lack of mastery of the required competencies or lack of focus on necessary skills. The first is a matter of degree; the second is a matter of substance. Either can be a problem in both the short and long term.

Organizations  — and individual leaders — want to avoid a discrepancy between areas of strength and areas of need; however, the data from our study indicates that organizations today are experiencing a current leadership deficit and can expect a leadership gap in the future.

Today’s leadership capacity is insufficient to meet future leadership requirements. The 4 most important future skills — inspiring commitment, leading employees, strategic planning, and change management — are among the weakest competencies for today’s leaders.

The leadership gap appears notably in high-priority, high-stakes areas. Other areas where there is a significant gap between the needed and existing skill levels are employee development and self-awareness.


What Can Be Done
When important competencies are found to be weak spots, targeted development initiatives can be put into place. The 24 companies that used our Leadership Gap Indicator were able to use their specific data to better understand particular strengths, challenges, current leadership deficits, and anticipated future leadership gaps.
The research has raised the alarm about the limitations of current leadership skills, identified
high-priority competencies, and flagged areas of particular concern. This information can help senior management facilitate conversations about the identification, development, and retention of key leadership talent. Research findings can also help organizations address the need for leadership development in a way that is current and realistic.
Organizations can also take these 5 steps to help bridge the gap:
Perform a needs assessment. Identify the capabilities that managers need now and in the future to execute and sustain the organization’s strategy. Our Leadership Gap Indicator is one way to determine organizational needs and leadership gaps.
Create a leadership strategy. A clear understanding of the leadership behaviors and business goals allows executives to develop a leadership strategy. In turn, development initiatives can be aligned with the operational needs.
Develop clear, specific goals and strategies for individual leadership development. Assess managers’ strengths and weaknesses as leaders against the core competencies identified in the needs assessment. Other assessments — including 360-degree feedback tools — can be helpful in evaluating individuals’ strengths and development needs. Be sure to factor in feedback, coaching, and assessment towards goal attainment.
Create systems. Excel at recruiting, identifying, and developing talent as well as performance management and retention.
Evaluate. Build in systems for measuring how these efforts are paying off› across the organization. What additional resources are needed? What metrics are in place to assess impact?
The sooner organizations understand the reality of their leadership situation, the quicker they can move to adapt by refocusing leadership development efforts and rethinking recruitment priorities. To increase leadership capacity, organizations need to take both a strategic and a tactical approach.
On the individual and tactical level, managers need to align the development experiences of managers with organizational objectives. Want ideas for developing the 7 key competencies with the largest future leadership gap, or more details on our research findings? Read the complete white paper, available for download below.

Previous Work:

This white paper is an extension of the previous work — The Leadership Gap: What you need, and don’t have, when it comes to leadership talent

Published: September 2015
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