As CEO of AESC, I come face-to-face with business leaders around the world on a regular basis. C-suite leaders regularly share with me common challenges in their industries and organizations, from a lack of diversity to the struggle to innovate in an increasingly complex and ever-shifting business environment. As a result, I recently discussed those top challenges of today.
But what about tomorrow’s challenges? What will the top concerns of C-suite leaders look like in five years and how can executives begin to prepare now? In an AESC report last year, "Executive Talent 2020," business leaders worldwide from across sectors and geographies predicted their top challenges in five years:
- Aging demographics
- Competition for talent
- Shortage of technical expertise
- Lack of key successors
With aging demographics as the number one business challenge forecasted for global executives in five years, organizational leaders are anxious about the baby-boomer generation retiring en masse and not enough successors prepared to take on leadership roles. This concern combined with an increasingly global business environment that requires heightened cultural awareness and localized knowledge, as well as the need for more technical and digital expertise, means the competition for top talent will only intensify over the next five years.
1. Create a succession plan now.
Aging leadership is a reality in developed markets worldwide, and the generation that follows baby boomers, Generation X, is much smaller. Most organizations are also flatter with a smaller middle management layer to tap into than in the past, creating additional challenges in developing successors. It is imperative that today’s business leaders identify both Gen X and millennial talent prepared to take on C-suite roles in their organizations over the next five to 10 years.
A healthy succession plan assesses the organization’s current needs with its long-term strategic vision. It then aligns current capabilities with future needs and identifies where there are talent gaps. Once those gaps have been identified, then the plan takes into consideration the current workforce that can be developed to fill those roles as well as where talent will need to be tapped externally. If you already have a succession plan, ensure it is regularly updated to align with your business strategies.
2. Expose your senior team to cross-cultural and cross-border opportunities.
In today’s competitive business environment, there is a premium on cultural dexterity and international experience. Digital transformation continues to collapse borders, eliminate the need for physical offices and connect teams scattered around the globe. While digital processes bridge geographies like never before, today’s leaders must understand cultural nuances, connect with a diverse workforce, customers and shareholders, and have insight into the unique factors of localized markets.
Today’s most successful brands reflect the diversity of our world, and today’s most successful leaders are empathetic and culturally aware. There is no better way for organizational leaders to develop these abilities than to have a broad range of experiences across different geographies and cultures.
3. Ensure a compelling employer brand.
Competition for top talent is fierce and will only become more intense with the looming generational transition of leadership. If organizational leaders want the best and the brightest tomorrow, they must have an employer brand that both attracts and retains top talent now.
Leaders must ask, what does their organization’s culture look like now and what does it need to look like tomorrow to align with their long-term vision? Are they fostering a diverse culture where individuals are empowered under a common mission? Does the mission of the organization include an articulation of the firm’s “social purpose” and/or commitment to their community? Are they fully leveraging digital to achieve true enterprise-wide digital transformation? All of this matters when attracting and retaining top talent, and it matters even more to the next generation.
4. Foster a digital culture.
With a shortage of technical talent, organizational leaders can develop cross-functional talent with the right digital expertise to lead tomorrow by ensuring digital is leveraged across functions and throughout the organization, including HR, which can play a bigger role in digital skills and process development. True enterprise-wide digital transformation, however, is not an easy feat. It takes the right leader who can rally a diverse, multi-generational workforce under a common vision for true enterprise-wide digital transformation to take place.
To get the right balance, senior management needs to understand the language of IT and technical talent must have a strong business foundation. Digital training at all levels throughout the organization can help develop tomorrow’s leaders with the right digital expertise, and prioritization at board level can only help ensure a robust plan to get there.
This article was originally published on Forbes.