leading in a global environment 2010 best companies for leadership june 21, 2011erin lap and rob...
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Leading in a global environment2010 Best Companies for Leadership
June 21, 2011 Erin Lap and Rob Stolk
2© 2010 Hay Group. All rights reserved
Agenda
1
2
2010 survey findings: facts/figures
The changing environment
Globalization and collaboration3
2010 survey findings: facts/figures
01
4© 2010 Hay Group. All rights reserved
The study results apply to all organizations
3,769 individuals participated in the study
Regional distributionRegion Per cent
Europe/Middle East/Africa 27.5
North America 26.6
South America 23.7
Asia 19.7
Pacific 2.6
Total 100.0
Source: 2010 Best Companies for Leadership study
Revenue distributionAnnual revenue in US$ Per cent
Under 500 million 32.0
501 million to 1 billion 13.5
1 billion to 5 billion 16.4
6 billion to 10 billion 6.6
Over 10 billion 31.5
Total 100.0
Source: 2010 Best Companies for Leadership study
5© 2010 Hay Group. All rights reserved
2010 Top 20 Best Companies for Leadership
1 General Electric
2 Procter & Gamble
3 Intel Corporation
4 Siemens
5 Banco Santander
6 The Coca-Cola Company
7 McDonald’s Corporation
8 Accenture
9 Walmart
10 Southwest Airlines
11 ABB Ltd
12 Microsoft
13 PepsiCo
14 Goldman Sachs
15 Hewlett-Packard
16 Unilever
17 Cisco Systems
18 FedEx
19 Pfizer Inc
20 BASF
World Wide
6© 2010 Hay Group. All rights reserved
The best companies for leadership outperform others over the long run
7© 2010 Hay Group. All rights reserved
14.42
(2.17)
6.17
1.27
13.84
(6.77)
(0.17) (0.76)
(10.0)
(5.0)
0
5
10
15
20
Pe
r c
en
t
Top 20
S&P 500
Top 20 produce better shareholder returns than S&P 500
Top 20 vs S&P 500
3 year total return 5 year total return 10 year total return
Source: S&P Compustat data as of 7/30/2010
1 year total return
8© 2010 Hay Group. All rights reserved
100 100 100
73 69
42
0
10
20
30
40
50
60
70
80
90
100
Leadership developmentprograms enable employees
to deliver ongoals/strategies
All employees have theopportunity to develop and
practice the capabilitiesneeded to lead others
There are a sufficientnumber of internal
candidates ready to assumeopen leadership positions
Pe
r c
en
t o
f re
sp
on
de
nts
Top 20All others
Best Companies for Leadership create better leaders
Source: Hay Group 2010 Best Companies for Leadership study
9© 2010 Hay Group. All Rights Reserved
Best companies for leaders focus
Collaboration
Diversity
Sustainability
Leadership
Practices – systems
Programs
The changing environment
02
11© 2010 Hay Group. All rights reserved
Innovation, efficiency and emerging markets will pave the way for future growth
12© 2010 Hay Group. All rights reserved
Increasing challenges and opportunities for organizations
Globalization
Shift in the global economy
Need to operate in global markets with local anchoring
Leading virtual teams from different cultures
Operating in a flatter, more matrixed environment
Managing across functions and geographies without authority
Increased use of technology
Driving innovation while reducing costs
Collaborating/partnering with outside constituents
Focusing on initiatives that will provide the greatest value
13© 2010 Hay Group. All rights reserved
Increasing challenges and opportunities for organizations
New trends and demographic changes
China and India will contribute an increasingly significant proportion of global talent
Women make up over half of the global educated workforce
Key leadership skills will be lost from the workplace as boomers exit the workforce
There is a growing number of inexperienced young managers, who need to assume senior leadership roles without the requisite leadership skills, particularly the case in emerging economies
Employees expect more from organizations
Purpose driven leadership – more than just generating profits
Work/life balance while meeting the needs of the organization
14© 2010 Hay Group. All rights reserved
Future leaders have to inspire, mobilize a diverse workforce to innovate and grow
15© 2010 Hay Group. All rights reserved
3
32
35
10
20
20
30
35
40
45
60
60
19
52
28
26
7
35
0 10 20 30 40 50 60 70 80 90 100
Social responsibility
Capacity to learn
Teamwork
Decision making
Technical competence/expertise
Inspiring leadership
Ethics
Execution
Strategic thinking
Per cent of respondents
Top 20All others
What organizations value most in leaders
Global top 20 vs all others
Source: Hay Group 2010 Best Companies for Leadership study
Globalization and collaboration
03
17© 2010 Hay Group. All Rights Reserved
How BCL drive collaboration
Everyone, at all levels, has to lead and to bring value
Actively seek out and disseminate innovative ideas, successful practices
Reward structures that encourage collaboration
18© 2010 Hay Group. All rights reserved
100 10095
90
66
80
4348
0
10
20
30
40
50
60
70
80
90
100
Programs designed todevelop leaders who cancreatively bring together
resources across theorganization
Use collaborativetechnologies to
encourage informationsharing across business
units
Expat program that dealswith blending expats with
the local culture
Company recruits culturalminorities
Pe
r c
en
t o
f re
sp
on
de
nts
Top 20All others
How the best companies prepare more effective collaborative leaders
Best Companies for Leadership are more proactive and focused in preparing employees to be effective in a global matrix
Source: Hay Group 2010 Best Companies for Leadership study
19© 2010 Hay Group. All rights reserved
How to make leaders more effective in a global environment
20© 2010 Hay Group. All rights reserved
BCL: gain value from diversity
Global views and direction applied differently to meet local needs
Hire and develop potentials from regions and constituencies, that they see as future markets
Programs and practices to help employees manage competing demands work-life
21© 2010 Hay Group. All rights reserved
Diversity
22© 2010 Hay Group. All rights reserved
BCL: sustainable work force
Changing values new generation
Contribute to society
Energy efficiency
Social responsibility
Combine initiatives with development
Flexible career paths
Purpose driven leadership
23© 2010 Hay Group. All rights reserved
Responsible practices
24© 2010 Hay Group. All rights reserved
29
14
27
35
31
64
73
10
15
15
35
55
90
100
0 10 20 30 40 50 60 70 80 90 100
Higher pay and bonus opportunities
Early long-term incentive opportunities
Fast track promotions
Mentoring programs
International opportunities
Stretch assignments
Per cent of respondents
Top 20
All others
Focus in the attraction and development of future leaders
Global top 20 vs all others
Source: Hay Group 2010 Best Companies for Leadership study
Targeted leadership training and development
25© 2010 Hay Group. All rights reserved
The future leaders of organizations are looking for a job that allows one to live a meaningful life and have a life
26© 2010 Hay Group. All rights reserved
61
84
95 100
32
43
60
92
0
10
20
30
40
50
60
70
80
90
100
Introduced an onboarding program to
help new parentsreturn to theworkplace
It is easy for people towork from home
Leaders are changeagents towards
higher enviromentalstandards
Company pays maleand female
employees the samerate
Pe
r c
en
t o
f re
sp
on
de
nts
Top 20All others
Best Companies for Leadership continue to adapt to employees needs
Source: Hay Group 2010 Best Companies for Leadership study
27© 2010 Hay Group. All rights reserved
Leadership must keep pace with organizational change
Competencies have been adapted to meet future challenges
Focus on preparing leaders to manage a global, divers workforce
Leadership development is a priority at the highest level in the organisation
Leadership development co-creation between top leaders and professionals