Companies face looming leadership crisis - IBM study

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Companies worldwide face a looming leadership crisis due to the retirement of baby boomers (see text at the end of this post) and rapid growth in Asia with half fearful they cannot develop the skills they need, a study released on Thursday (Oct 18 2007) said.

The survey by IBM's consulting arm interviewed 400 HR executives from 40 countries and suggests companies are putting growth strategies at risk if they cannot identify and develop the next generation of leaders.

Baby boomers will drain companies of valuable knowledge when they retire, while multinational firms need to find people to lead their businesses in booming markets such as India and China, the study said.

"You've got this perfect storm of leadership crisis that is hitting the mature and maturing markets," said IBM's Eric Lesser, one of three co-authors of the study

"Companies are really crunched both in terms of their current capacity of leadership and also their ability to develop leaders in the future. Three-quarters of the people who responded said this was a significant workplace issue."

The study found 88 percent of companies in the Asia Pacific region are most concerned with their ability to develop future leaders, followed by Latin America (74 percent); Europe, Middle East and Africa, (74 percent); Japan (73 percent); and North America (69 percent).

Fifty-two percent of HR executives say their organizations may be unable to rapidly develop skills to meet current or future business needs. The study also found 36 percent of firms said employee skills fail to meet company priorities.

With competition for talent on the horizon, younger job applicants might want to list online gaming skills on their resumes, Lesser said. Many can be translated to realities of the new workplace.

"It requires using virtual communication techniques, everything from voice over IP to instant messaging to e-mail," Lesser said.

Source: Daniel Trotta, Reuters, October 18, 2007

A baby boomer is a person born between 1946 and 1964 in Australia, United Kingdom, Canada and the United States. Following World War II, these countries experienced an unusual spike in birth rates, a phenomenon commonly known as the baby boom. The term is iconic and more properly capitalized as Baby Boomers.
 Source: Wikipedia

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