Five essential skills for future-ready leaders

What are the leadership skills needed to be future-ready? During a recent conversation, a German multinational conglomerate expressed that one of its biggest challenges is preparing its people for what’s next, before it’s too late. It’s not alone. IBM’s Global C-suite study of 13,000 participants from 98 countries and 20 industries highlights that over 70% of C-suite executives share a similar sentiment.

Digital technology advancement, geopolitical tensions, rising competitive threats, and societal change create an operating environment unprecedented in dynamism, speed, and scope. Few will argue against the need for significant upskilling to meet these demands. But organizations, leery of resourcing missteps, crave increased clarity about their talent development investments.

In our work with colleagues at Thunderbird School of Global Management, spanning hundreds of enterprises in the private and public sectors, five competencies stand apart. Collectively, they underscore the relevance shift from discrete knowledge to targeted learning capacity. What you know and can repeat in static settings is quickly giving way to how you can come to know and act intelligently in unstable settings.

Growth and global mindset

Performance in nearly every metric – creativity, engagement, discipline, fulfillment – improves when effective mindset positioning is employed. Belief in one’s own and others’ ability to grow and develop is core to stretching from a current capacity state to a desired future state. Sidestepping the common mindset (in which your best prospect is to become the average of your operating environment), a growth orientation encourages curiosity and next-level commitment. Effectively assessing for and building growth mindset positioning capacity is the foundation on which all other growth dimensions build.

In addition to growth orientation, the future-ready mindset is global. This involves being comfortable, and thriving, in uncomfortable situations. Differences become opportunities to build bridges, rather than chasms to avoid. The global mindset is inclusive and capable of quickly detecting key intellectual, psychological, and social factors to successfully build trust and span borders, cultures, and backgrounds. Rigorous tools like the Global Mindset Inventory can help individuals and teams to better define, measure, and develop in this area.

Innovation and adaptive capacity

Given the current era’s speed of change, innovation and adaptive capacity are essential. In just fifteen years, Apple rose from near bankruptcy to become the most highly regarded brand in the world. During that same period, IBM plummeted from one of the top three most highly regarded brands to nearly dropping out of the top fifteen. General Electric fell out of the rankings altogether after spending several years in the top five. Google went from being unranked to being second globally.

Similarly, in just ten years, a large glut of products went from being non-existent to being deeply rooted within the consumer landscape: iPad, Instagram, and Slack all strike as significant examples. Go back one more decade and the world was still yet to see the emergence of any smartphones, functional WiFi, social media platforms, podcasts, on-demand streaming services, or any of the AI, or machine learning capabilities heavily present in the world we live in today. This pace of innovation has significantly altered the trajectory for the world of business. In fact, the average age of companies in the S&P 500 has fallen from 61 in 1958 to less than 20 years today.

Firms that develop for and deeply support innovation and adaptive capacity unleash a cadre of skilled conduits for valuable ideas (Washburn, N. T & Hunsaker, B. T, 2011)[1] (Hunsaker B. T. 2020) [2] Transcending the underwhelming organizational mold of isolated, one-way innovation efforts, future-ready firms attract and intentionally develop people who effectively observe and scan their surroundings for promising opportunities, test them to identify their distinct advantages, and skillfully win their adoption. As operating environments grow more dynamic, the premium for investing in innovation and adaptive capacity skills increases.

Strategic savvy

Innovation is not in itself a strategy, but rather the mechanism for achieving a change in either magnitude, activity, or direction. Innovation propels the action but doesn’t determine it. Strategy does. So, connecting the two is key.

Traditional approaches to strategy focus on goal-setting and plan-formation, but largely assume industry boundaries and constraints, and economic stability. As a consequence, many popular approaches for formulating strategy are ill-suited to inform leaders faced with navigating dynamic operating environments. Therefore, a process of retooling is in order. This strategic savviness begins with reorienting our focus from what is stable to what is changing, including related challenges and rising opportunities, and broadening our previously narrow concept of the assets likely to drive unique value going forward. Then, ‘hiring’ innovation to power the prescribed magnitude, activity, or direction change – likely resulting in gaining the advantage.

Action agility with execution precision

Realizing the value from advantages depends on the quality of their execution. Future-ready leaders are nimble – they’re comfortable with iterative implementation – and they are disciplined – they apply resources precisely in relation to iterative feedback. This helps future-ready leaders to significantly outpace their peers’ execution efforts, which average just 60% of initiative potential.

To aid their implementation efforts, future-ready leaders make quick, deep use of intelligent insights and effect mechanisms to catalyze execution efforts. This approach differs from traditional managerial controls, which tend to be negatively rigid and focus on regulating effort quantity, concentrating power, and insulating personal interests. Whereas the dominant interest of a catalyst is to positively diffuse power to those responsible for carrying out an initiative – boosting execution outcomes through input quality. Think of the difference between two vehicles of the same make and model, but one has a control governor set at 50 kph. An understanding of the tools for and commitment to iterative decisive execution is key when perfect information isn’t available before action is required.

Data and technological intelligence

A working fluency with data and technology, including its power and limitations, allows the future-ready leader to harness the necessary connectivity to gather reliable information and convert this to powerful insights that improve decisions. Leaders high in this skill are less likely to be surprised by disruptive forces and more likely to channel them for optimization gains. While valuable in itself, this skill is also transcendent for its ability to aid and influence the other four skills. Increasingly, its importance cannot be overstated.

Conclusion

These five leadership skills provide professionals with the capacity to: thrive in uncomfortable situations; know when and how to change for the better; employ targeted innovation to drive that change; purposefully iterate and precisely capture more value from their execution; and embrace purposeful data and technology to increase decision clarity, optimization, and opportunity, fusing high-touch ideals and high-tech capabilities to effectively advance when others hesitate or retreat.

Future-ready leaders also know that ‘future-ready’ is not a steady-state but rather a continual process of becoming and refining. They know that learning is always the answer because the leadership skills of tomorrow will always evolve.

Tom Hunsaker is Associate Dean of Innovation for the Thunderbird School of Global Management. Tom’s work has been recommended reading in leading universities, applied by thousands of enterprises and their leaders, is published in top practitioner outlets such as Harvard Business Review and MIT Sloan Review, scholarly journals, and has been featured in popular press globally. He is the author, most recently, of Bridger: What World-Class Innovators Do.

Mary Teagarden is Associate Dean, Faculty & Administration for the Thunderbird School of Global Management. Mary’s work has designed and delivered a wide variety of executive development programs. Her work has been featured in the popular press including the Financial Times and the Wall Street Journal. Mary’s research has been published in top practitioner outlets such as Harvard Business Review, MIT Sloan Review, Organizational Dynamics, Human Resource Management and the Journal of World Business.

[1] The concept of Innovation Bridgers was first introduced in Harvard Business Review. Washburn, N. T., & Hunsaker, B. T. (2011). Finding great ideas in emerging markets. Harvard Business Review, 89(9), 115-120.

[2] Innovation Bridgers: The new talent imperative. Thunderbird International Business Review, 62(4), 385-392. Hunsaker, B. T. (2020).

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