Global Study Indicates Future Organizational Leadership Crisis

According to a press release, IBM’s Global Human Capital Study shows organizations in every corner of the globe are concerned with their ability to develop future leaders: Asia Pacific (88%); Latin America (74%); Europe, Middle East and Africa, (74%); Japan (73%), and North America (69%).

While rotating employees across divisions and geographies is an important way to hone future leadership talent, the study found 36% of HR executives stated rotating leadership talent is a significant challenge in developing future leaders. Another key challenge cited by respondents was the generation gap – passing on knowledge from older to younger employees – cited by 28%.

Fifty-two percent of HR executives said another significant workforce-related challenge facing their organizations is the ability to rapidly develop skills to address current and/or future business needs. In addition, more than one-third of study participants (36%) stated their employee skills are not aligned with current organizational priorities.

Forty-seven percent of the organizations surveyed said that employee turnover has increased over the past two years, while only 16% said it has decreased. However, only 27% of respondents stated the inability to attract qualified candidates is a problem.

Retention was also less of a concern for the HR executives polled, as only 18% stated this is a high priority workforce issue. The study found respondents believe that despite the ongoing war for talent, they are more capable of attracting and retaining talent than their competitors. Almost 60% of HR executives surveyed said they are more effective at attracting and retaining talent than their peers, while only 10% stated they are less effective.

Only 14% of HR executives stated their workforce is very capable of adapting to change. The study identified three success factors organizations need to develop for an adaptable workforce:

• The ability to predict future skills: Successfully anticipating future business scenarios enables organizations to know what key competencies to target in advance of critical market shifts, however, only 13% of organizations said they have a very clear understanding of the skills they will require in the next three to five years.
• The ability to locate experts: The ability to apply existing knowledge and skills to new challenges is important. Only 13% of survey respondents said they are very capable of identifying individuals with specific expertise within the organization. More than 50% of companies that said they are “very effective” in locating experts by using some form of employee directory, while only 39% of all respondents reported using them.
• The ability to foster collaboration: According to the study, only 8% of companies said they are very effective in fostering collaboration. Organizational silos (42%) were cited by respondents as the leading barrier of collaboration in an organization, followed by time pressures (40%), misaligned performance measures (39%), and technology (28%).

The Global Human Capital Study titled “Unlocking the DNA of the Adaptable Workforce” was developed by IBM Global Business Services’ Human Capital Management practice and the IBM Institute for Business Value (IBV), with assistance from the Economist Intelligence Unit (EIU) and was conducted from February to July 2007. Over 400 human resource executives from 40 countries participated.