In the third decade of the 21st century, positions of power in major organizations will be held by people who graduated after the year 2000. Some of these will barely be aware of memories from the 20th century.
Right now, key leaders of the next decade are already working in our organizations, climbing up the corporate ladder and developing skill sets that will allow them to reach the level of responsibility they aspire to. One of the challenges companies face today is how to identify individuals with a calling for driving growth over the coming years. Arguably there’s nothing new about this challenge: replacing management is part of an organization’s routine dynamics right from its start up.
Many experts share the view that this process now has its own characteristics which companies must manage with great care as their mid-term sustainability depends on it. Nowadays selecting and training managerial talent is quite different from how it was done in our recent past owing to the rising pace of changes we face. In evolving markets, managers evolve. In disruptively changing business environments, leaders are transformed more radically.
Somewhat naively, some of today’s top CEOs think of their successors as people rather like themselves, but with the spirit of someone 15 to 20 years younger. In contrast, other CEOs, who deeply value the businesses they dedicated years of their lives to, are aware these must be led by other individuals different from themselves, if these businesses are to survive.
For some clues on emerging managerial skills, it’s worth reviewing the profiles of the top CEOs today. Their successors will be different from themselves, but these leaders have already foreseen some traits that are certain to set the trend over the next few years. A Harvard University study presents us the top CEOs ranked globally.
The analysis is based on financial performance indicators, such as returns on investment and value creation, but other variables are also measured, such as the company’s medium and long term strategic prognosis. Additionally the study incorporates criteria on the environment, good governance, citizenship, social responsibility and leadership among others, according to data provided by the Reputation Institute.
In the 2016 edition, Lars Rebien Sorensen of Novo Nordisk is ranked first, followed by Martin Sorrell of WPP and then Pablo Isla, President of Inditex. Of the traits common to these CEOs, we’d like to draw attention to:
- Ability to understand the environment in which the business activity is developed. Everyone knows their respective businesses in depth, but they are not just experts in a particular sector of activity. The index penalizes those who are merely great specialists to reward those managers who revitalize more; such managers possess a broad vision of society’s problems and expectations as well as truly diverse interests. Sorrell, for example, believes that the biggest challenge for CEOs is addressing volatility, which includes major geopolitical issues.
- Highly sensitive to the sustainability of their respective ventures, obviously from the economic point of view, but also from others like social, environmental, etc.
- Balanced personalities. Contrasting with managers of the past who typically possessed brilliant vision and meticulous logic that served to achieve goals, Pablo Isla instead stresses the need to balance reason with emotions. He asserts that in order to lead, one must be very rational, yet he acknowledges that time has taught him to be less rational and more emotional. In his particular case, running a company with 150,000 employees called for the ability to appeal to people's emotions—something that’s essential for creating an environment which enables innovation.