In the digital age, companies in every industry must unleash a new wave of innovation – or be disrupted by aggressive new competitors. Digital is transforming everything from consumer behavior to employee engagement to the management of cities and infrastructure.
Amoco, Anheuser-Busch, Chrysler, Motorola, Wrigley. Great Midwestern companies that failed to adapt to global competition and ended up being acquired. Many others have suffered the same fate or declared bankruptcy, and now the ongoing disruption from globalization and technological change is putting our legacy companies under further pressure.
As digitization sweeps across China’s economy and transforms consumers’ expectations and behavior, companies in every sector are scrambling to keep up. They must reimagine customer experiences, win at e-commerce, and harness digital technology to reshape their operations and organizations.
CHROs today face an ever more difficult challenge – identifying and developing the talent to drive the transformation required in today’s organizations, individuals who can solve problems quickly and in new ways, with the fortitude to navigate in uncertainty and to accept and overcome failure through an onslaught of data and marketplace changes.
What’s holding many of today’s best executives back from true success? It’s likely not skills or competencies, both of which have often been honed through years of development through ever-more challenging roles.
In the cover article of the June 2014 Harvard Business Review, Claudio Fernández-Aráoz argues that potential—even more than skill and experience—must be the deciding factor as companies recruit and promote executives in a fast-changing, talent-scarce world.
The last two decades have seen a dramatic evolution in Global In-house Centers (GICs), as their value proposition has shifted increasingly from cost arbitrage to talent and skill arbitrage. As a result, GICs—until recently known as “captive centers”— are now driving process and productivity improvements for the corporation, creating new capabilities such as analytics, and leading crossfunctional synergies.
Egon Zehnder CEO Rajeev Vasudeva recently hosted a dinner for board members, CEOs and chief human resources officers whose operations in China and India give them a strong interest in developing local leaders in these emerging markets. The lively discussion generated the following observations.
Everyone agrees that CEO succession planning is critical. Yet many Chairmen are concerned that their own companies are underprepared for a change of CEO – and are exposed to the risk of a damaging leadership vacuum. This is the finding of an Egon Zehnder study in which more than 50 Chairmen and CEOs of major companies headquartered in France, Germany, the UK, and the US were interviewed.
Many businesses are keen to leverage the huge potential of the Indian market. However, gaining a successful foothold in India takes perseverance and a real effort to adapt to the nuances particular to this country.
Family owned and promoter run organizations are often the best custodians of long term value creation in India. Yet, many of these organizations have had a mixed record in attracting and retaining high quality professional talent from the outside.