6 Leadership Development Trends for 2015

Deloitte recently released a new research study that demonstrates a surprising gap between what’s being said and what’s being done by business executives – a problem that derives mostly from the lack of focus in leadership development. Still, during the last few years leadership development programs have received their fair share of criticism – this piece from CLO Media examines each and every problem attributed to this kind of skill training.

Even though in the last decade companies would allocate more funds than ever to train their executives, a 2012 poll by the Center for Public Leadership at Harvard University showed that as many as 70% of Americans blame leadership crisis as a factor in the national economic decline. Considered against this puzzling situation – where the demand for leadership skills is on the rise and leadership development programs often fail to deliver their promised results – what is the future of leadership development?

70% of Americans blame leadership crisis as a factor in the national economic decline.

Leadership Development in 2014 

Before we go on to unveil the future trends, let’s have a look at what was happening on the leadership training scene this year. Among the most innovative leadership strategies being taught all over the world was the so-called “endogenous resourcing”, standing for the myriad techniques for unlocking employees’ hidden potential.

Apart from this trend, we saw the rise of management policies that foster sustainability and a slow transition from the autocratic, control-and-command management style to its more democratic variety – both demonstrating how the human side of business has become a growing factor in the success of leadership as employed by many global brands.

Having examined the present, let’s now direct our gaze to the future – here are 6 innovative leadership development practices that we will see spreading in the upcoming year.

The human side of business has become a growing factor in the success of leadership as employed by many global brands.

1. Generational Difference Management

One of the most important developments of the global leadership scene is the rise of Millennials, who will now obtain more leadership positions with high level responsibilities. Aon Hewitt

Top Companies for Leaders report points out that in the near future, organizations will need to learn how to mitigate the generational differences, which will arise once Millennials get hold of executive jobs, and how to develop new strategies to benefit from the strengths of this generation.

Millennials are generally described as team-players and high achievers. They’re independent, but like to follow rules – they’re confident, but trust authority. They are the only generation that has grown up completely immersed in technology, so it’s only natural that their leadership style will be completely different than the one endorsed by Generation Y.

This trend is already visible in one of the best practices around – at Johnson&Johnson, who created an affinity group called Millennials to provide leadership development opportunities to this generation and new exposure designed to help in the overall development of all employees.

2. Small Companies Will Invest More

Bersin by Deloitte recently published a 2014 Leadership Development Factbook, where one of the main trends observed on the American market was the curious fact that the biggest investment boost for training leaders came from small businesses. As it turns out, in 2013 an average small company would spend 23% more on leadership development initiatives – and this tendency is likely to continue in the upcoming year.

Organizations will need to learn how to mitigate the generational differences, which will arise once Millennials get hold of executive jobs, and how to develop new strategies to benefit from the strengths of this generation.

The growth of investment was noted in all organizational structures – from small and mid-sized companies to large, multinational organizations. This essentially means that there is a growing global awareness of how leadership models changed in the 21st century and a firm recognition of the value brought by leadership development programs – investing in development will be seen as an excellent way to build the capabilities needed for the future.

3. A Globalized Approach

The Global Leadership Forecast 2015, Ready-Now Leaders: Meeting Tomorrow’s Business Challenges conducted by DDI, a talent management consultancy, revealed that one of the growing concerns is the ability of executives to lead across countries and cultures, regardless of the company’s size. “In an increasingly globalized world, it is still an issue for almost any size of organization,” says Simon Mitchell, UK general manager for DDI.

He adds: “Businesses must recognize that managers and leaders that operate outside of the home market or as part of a team that stretches across borders need specific skills and qualities such as coping with ambiguity, having clear and effective interactions and making decisions in unfamiliar environments become increasingly challenging when operating across border.”

4. “Emerging Leaders” Will Get More Funding

The report produced by Bersin by Deloitte also pointed out that today, many companies struggle to fill leadership gaps found on all levels of organization. The trend for detecting potential leaders and nurturing them in the development of their skills will be crucial in the upcoming year as companies will grow more and more committed to developing new leaders.

Together with their growing commitment will go more funding – the study showed that today, the so-called “emerging leaders” get a smashing 17% of the overall leadership development budget! Investing in future leaders is and will be recognized as the opportunity for building potential pipeline at every level of leadership.

5. The Rise of Collective Leadership

Among the trends mentioned in a report entitled Future Trends in Leadership Development published by the Center for Creative Leadership is the decline of the “heroic leader” and the successive rise of a new form of leadership – a collective one. While in collective imagination leadership still often means individual, the situation is changing due to the new environment – full of the so-called “adaptive challenges” that negate the possibility of an individual coming up with the best solutions to complex problems.

The report points out that some organizations are already embracing this new view of innovation as a phenomenon not initiated by an individual but a whole social network. This change will be fully embraced once Millennials take hold of leadership positions – the new approach will require a radical transition in thinking.

6. Focus on Vertical Development

The Center for Creative Leadership report also mentioned a future trend, which is directly related to the future training programs – they are expected to be less about realizing a certain competency model and more about the vertical development. While competency-based models belong the the domain of horizontal development, vertical development concentrates on the stages that people go through as they grow mentally.

What does it mean in practice? New training programs will allow leaders to think in a more complex way and develop a new mind-set that will in turn help to initiate new leadership styles. Those leadership styles will be more collaborative and participatory than before – they will all flourish thanks to the skills and knowledge acquired in revamped leadership development programs in 2015.

The Future of Leadership Development

DDI’s Simon Mitchel is convinced that leadership development has a bright future, mainly due to the complexity of the contemporary economic reality: “Many leaders feel unprepared for the world around them, and this is a troubling situation. This is partly because of the characteristics of the world that leaders operate in: volatile, uncertain, complex and ambiguous. These traits are unlikely to change in the foreseeable future, and yet less than two-thirds of leaders are confident they can meet the challenge.”

Companies with high leadership qualities were six times more likely to be among the top 20 financial performers of all organizations.

The DDI report itself emphasized the role of leadership development for the future growth of organizations all over the world. Companies with high leadership qualities were six times more likely to be among the top 20 financial performers of all organizations and those boasting high levels of leader engagement and retention, as well as leadership quality, were nine times more likely to outperform their peers financially.

That being said, the future of leadership development strategies will reflect how companies deal with new leadership challenges and economic realities.