In today’s challenging economy, leaders at all levels are facing enormous challenges when it comes to achieving and sustaining breakthrough operating results. Globalization, economic change, more stringent regulation, and tougher governance make realizing shareholder value increasingly difficult. But there is another challenge: In a breakthrough executive trends global research study I conducted with my colleague, Bonnie Hagemann, which was published by Pearson in 2011, we clearly confirmed that identifying and developing high-potential and emerging leaders is and will continue to be one of the top business issues facing CEOs; 40 to 70 percent of all executives in most organizations will become eligible for retirement in the next five years.

In our increasingly knowledge-driven world economy, organizations are right to fear this imminent brain drain, suspecting that, when executives leave the firm, business may follow. Yet high-potentials and emerging leaders—those most likely to rise to fill those highest positions—account for less than 8 to 10 percent of the talent pool. That’s in the United States. In other countries, like Canada, Australia, the United Kingdom, Japan, and China, and in just about every country except India and various countries in Africa and South America, this issue is as pronounced as it is in the United States, if not more so. Therefore, identifying, developing, and retaining such rare talent truly is a mission-critical global challenge for CEOs, senior executives, managers, and HR directors.

Given this indisputable global business challenge, the implication for current and emerging leaders is clear: the demand for outstanding leaders will soon surpass the current supply and therefore if you are a current leader or emerging leader there will be massive opportunities for you to seize if you are poised and ready. Regardless of your own desire to ascend up the ladder, one thing is certain: all organizations will be asking more of their leaders with expectations, demands, and pressure increasing not decreasing. The demand for truly outstanding leaders has never been higher and organizations are “raising the bar” as they must in order to compete successfully on the global stage.

But, where are the truly outstanding leaders in business? As I travel the globe meeting with senior executive teams, coaching executives and speaking to various management groups, it is clear to me that there are in fact very few outstanding leaders in the world of business. There are many very good leaders and there is a vast supply of good leaders. The distribution of outstanding leadership, just like anything else, follows the shape of a bell-shaped curve. I always knew this. Everyone has always known this. But nobody really cared because being a good leader has always been good enough to keep a position and deliver to the basic requirements of that position. But, things are changing-quickly. The bell-shaped curve needs to be replaced with a positively-skewed distribution where all organizations possess a larger percentage of “very good” and “outstanding” leaders at a minimum just to be able to compete.

I had suspected the need for this critical shift for a couple of years but it became very clear in 2011 as we were interviewing executives as part of our Trends in Executive Development Research Study (Pearson, 2011) which I co-authored with my colleague, Bonnie Hagemann. Beyond the actual research, qualitatively, it is interesting to note that roughly 9 times out of 10 when I ask an executive to identify a great leader in their lives who had a positive impact on them and helped shape their values, they mention a former teacher, coach, parent, grandparent or friend as opposed to a business leader. It is an unfortunate statement but true statement that most of us in the world of business can much more quickly identify the poor managers we have had rather than the great ones.

But why is this? I believe it is pretty clear that many managers are promoted before they are ready to assume leadership roles. Many managers are not adequately trained, coached and mentored by more seasoned executives who often can share stories and insights that can dramatically shorten a manager’s learning curve. More than anything else, I believe the speed and pace of change in business—technology shifts, demographic shifts and a more demanding operating environment represent massive challenges to most leaders and frankly very few possess both a strong “inner-core” of values, character, beliefs, thoughts and emotions and “outer- core” set of leadership competencies that are truly required to successful navigate these challenges. In the end, we have too many executives beginning to derail or have already derailed because of character flaws or at a minimum just sheer immaturity.

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