TORONTO--(BUSINESS WIRE)--Only 15 per cent of business executives worldwide have confidence in their company’s own top leadership to successfully manage disruption, including unexpected events like pandemics, technological advances, shifting demographics and climate change. The lack of confidence is striking as 95 per cent of executives also believe that managing disruption well is critical for companies to succeed in turbulent times.
The findings come in a new global analysis from Odgers Berndtson, a leading global executive search firm, which concludes there is a worldwide crisis of confidence in top business leaders which will force successful companies to “reinvent leadership” for the modern world. This is particularly important now as, according to Harvard Business Review Analytic Services (HBR-AS), senior executives around the world believe managing disruption well is not only critical to success in the organization, but also brings “discernible competitive edge.”
“The quality of leadership is critical to the success of companies, especially when they are faced with an unexpected external threat to their business,” said Eric Beaudan, Global Head, Leadership Practice, Odgers Berndtson. “The recent outbreak of the Coronavirus is yet another example of how challenging it can be to lead an organization in today’s rapidly changing, global ecosystem. Leadership’s ability to respond to these emerging risks will be critical to their organization’s success.”
Using a methodology developed with HBR-AS, the firm today launches the first Odgers Berndtson Leadership Confidence Index. Using data from almost 2,000 senior executives, managers and board members of companies with sales from $50 million to $5 billion around the world, this gives a first measure of confidence in the ability of top leaders to drive success in changing times.
In its report, Odgers Berndtson notes that 88 per cent of senior managers and executives expect disruption to increase over the next five years, and almost as many (85 per cent) say it has already had an impact on their organizations. With only 16 per cent of senior managers reporting that their company’s top leadership has managed disruption well to date, even fewer (15 per cent) are confident they will do well in the future. The majority (61 per cent) are tentative but a quarter (24 per cent) are actively worried – with similar results across all global regions.
This crisis of confidence appears most stark when it comes to individual roles and leaders, notably chief executives. While 85 per cent of respondents believe the CEO has the most critical role to play, 40 per cent express doubts that the person in the top role will manage disruption well over the next five years. Similarly, the Index shows confidence is also lacking in all C-suite roles – including key top jobs such as finance, human resources and technology – and that there are clear differences between the top 15 per cent of leaders, who inspire the most confidence, and the rest.
The Index also identifies the qualities and traits senior executives need most to thrive in changing times. “The quality of leadership has never been more important,” Kester Scrope, Chief Executive Officer, Odgers Berndtson. “For the first time, this Index shines a unique light on the attributes leaders need most to develop confident organizations aligned to the modern world.”
The Index also compares companies that score highly on confidence in their top leaders with those that don’t. Confident companies are the most positive about their leadership’s courage, vision and curiosity, plus their ability to drive a sense of purpose, trust and collaboration.
Odgers Berndtson believes an evolution in leadership is required for companies to thrive in a world of complexity and uncertainty, combining the drive, adaptability and curiosity required for constant change, with the vision and courage to lead change, and resilience to stay the course. Leaders need a mindset to cope with change, and the humility to move on from old command and control structures.
“In the study, we’ve found that just because leaders have been successful in the past, and might be a good CEO, CFO, CIO or CHRO today, doesn't mean they have the skillset, mindset or capabilities to help us confront future change and challenges,” continued Beaudan. “Today’s successful leaders need to have a healthy attitude towards change and this behaviour must be taught, modelled and practiced throughout the organization.”
“Talent development is among the top priorities and responsibilities for the board and for senior executives. It's not just an HR issue; it's not just a CEO issue; it's a business survival issue,” concluded Beaudan.
*Additional key findings from the Index can be found here
Note to editors
For this study, we defined disruption as the unsettling forces that can impact an organization’s strategic direction and challenge its operational capabilities, such as emerging technology, competition from unexpected quarters, the impact of climate change, regulatory oversight, innovative business models, rising customer expectations and shifting demographics.
About the Odgers Berndtson Leadership Confidence Index
The Odgers Berndtson Leadership Confidence Index is believed to be the first measure of confidence in global business leaders and their ability to manage through disruption and drive success.
The methodology has been developed by Odgers Berndtson with Harvard Business Review Analytic Services (HBR-AS). Our analysis is based on responses to a study of 1,890 senior executives, representing companies with revenues ranging from $50 million to over $5 billion.
The Index provides a single measure of confidence in leadership’s ability to succeed through disruption by combining the responses to questions examining 44 attributes and activities of leadership. The Index also measures confidence in leadership skills, experiences, motivations and behaviours. Companies with high and low confidence scores are compared to highlight those leadership activities and attributes that are found to a much greater degree in organizations that feel positive about future success.
About Odgers Berndtson
Odgers Berndtson is a leading global executive search and leadership advisory firm with more than 250 partners in 29 countries. We provide our clients with a broad range of integrated talent solutions – including executive search, executive interim, and leadership assessment services – to help them grow and compete in today's challenging environment. We also invest in the development of Canada's up-and-coming leaders with unique programs, such as CEOx1Day and the CFO Leadership Program in partnership with the Rotman School of Management.