Susan Silvano, CMI
With the bulk of Baby Boomers reaching 65 by 2010, who in today’s leaner workforce is being groomed to lead tomorrow’s companies?
Deregulation, restructuring, fuel supplies and environmental standards create a challenging business environment for the power industry. Coupled with the continuous need to both build and maintain facilities, it takes creative and tenacious leadership to deliver shareholder value.
With a majority of today’s leaders nearing retirement age, companies must start shaping their leadership resources today.
A 2000 General Accounting Office report titled “Senior Executive Service: Retirement Trends Underscore the Importance of Succession Planning” stated that “retirement eligibility in the executive ranks will climb at a rate of 18 percent between 1998 and 2005.” The report concluded that succession planning was a critical issue that should be included as a part of strategic goals.
With the year 2010 on the horizon, many senior executives will have their eyes on retirement. The Forbes “2004 Special Report on 2004 CEO Compensation” listed 500 of the highest paid executives. The youngest was 38 years of age. The greatest concentration of executives, 53 percent, was between the ages of 53 and 61. The largest decline followed age 61. The oldest CEO was 85.
How will this report look in 2010? Where are the leaders of tomorrow going to come from? What leadership and communication styles will be needed? Are there going to be more companies competing for the top leadership talent? An obvious answer is that the leadership pool will be leaner. Regardless, the companies that prepare today by identifying and developing their leaders will be better prepared to meet the business environment of 2010.
What are the basic leadership attributes that companies should look for?
“General intelligence, interpersonal effectiveness, impulse control, and the ability to rapidly analyze and make decisions on complex issues,” said Ken Pederson, PhD., president of Michigan-based Executive Talent Management, LLC. “You can identify real leaders very early. They consistently learn the role faster and make a quicker impact than their peers.”
Dr. Pederson also considers the leadership requirements of a modern organization: “Technology and the evolution of what work is will force companies to replace Boomers with different types of leaders-potentially a more flexible, technically savvy and efficient leadership cadre.”
First-line employees who show leadership potential are often candidates for early supervisory positions. It is assumed that these individuals will advance through the ranks during their careers to serve in senior positions. However, many employees who advance to first-line supervisors don’t excel as leaders because they lack the required strengths. These employees might make a greater contribution by serving as role models for less experienced employees. To support this culture, a company has to value and acknowledge its senior non-supervisory employees by adequately recognizing, training, and compensating them.
The key to effective corporate succession planning is identifying and developing the leaders of tomorrow early in their careers. Dr. Pederson stated, “Early identification of high potential employees, coupled with targeted coaching and diversified experiences, allows them to cope with the demands of rapid career expansion and provides the corporation with resources which will be ready when needed.”
Employees who are taught basic interaction and communications skills will demonstrate leadership qualities much earlier. Programs that help individuals to identify their own personal styles-like CMI’s own “Kingdomality” program-can assist both companies and employees in today’s corporate kingdoms to work successfully with others who look at the world differently. Assessment of individual styles and strengths provides the basis for career development to benefit an organization’s mission.
Preston Johnson Jr., senior vice president for human resources and shared services for CenterPoint Energy in Houston, Texas, states that his company is currently providing individual assessments, skill gap analyses, development planning and coaching for both “first and second tier” potential leaders, in order to prepare them for the future.
Johnson stated, “We’re especially concerned about the potential talent gap since over 35 percent of our organization will become retirement eligible in the next five years. We have a burning platform business mandate from the board of directors to our senior leadership team to further build our future leadership capability and readiness. It is a business and competitive imperative.”
Business challenges will always require more of corporate leaders. One of today’s great challenges is to provide companies with the leadership required to drive them to success in 2010. Early leadership identification and development is the key to success.
To learn your leadership style and how to best develop your employee’s potential, go to www.kingdomality.com and take the personal preference profile. EL&P’s own Kathleen Davis has taken the profile herself. She was awarded the title of “discoverer,” described as “an insatiable explorer of people, places, things and ideas.” Silvano is president of Career Management International (CMI).