Traditional leaders face their Waterloo

"Who wants to be the leader? Pick Me! Pick Me!" 

"In a workforce populated primarily with gen X, Y and millennials, a tipping point has been reached and it is they who are telling us how they want to be led."

That's a refrain I used to hear a lot as a 10 year old, when everyone wanted to be the ‘leader of the gang’ (and yes, I am showing my age.) 

Fast forward to the real world of work and it was another 25 years before I heard the word leader used again. 

As one of the younger baby boomers still hanging around in the workplace, I have been intrigued by the shift from management of a task to leadership of people as a core executive competency. 

I am also occasionally disconcerted by the fact most employees now have clear and precise expectations of their leaders and are not afraid to tell us what they are. 

When I started work back at the tail end of the 70s, the very notion a subordinate had any demands they could make of their bosses would have been laughable. 

Bosses were there to tell you what to do in whatever way they chose. Sometimes they did this nicely and sometimes not. It was obvious which was preferable but you got what you got and that was that. 

Things have moved on. In a workforce populated primarily with gen X, Y and millennials, a tipping point has been reached and it is they who are telling us how they want to be led. 

Even more importantly, it is pretty clear if they don't like the leadership style in one company, they will up sticks and move to another without a second thought, but not before providing feedback of you as an employer to hundreds of their real and virtual friends. 

At ANZ we carry out an annual survey of all our staff we call ‘MyVoice’. Typically around three quarters of our 50,000 employees take the time to answer around 60 questions to let us know what they really think and they expect us to act upon their feedback. 

Like many others we identify an engagement score, which is an index of four core questions covering satisfaction, pride in the company, intent to stay and whether they would recommend ANZ as a great place to work. 

We are then able to determine which of the myriad of questions we ask are most likely to drive that engagement score up if improved (or down if they decrease). 

It is not pay, benefits, teamwork or the availability of resources that are key drivers. Instead, six of the 10 questions that most drive engagement relate to the quality of senior leadership. 

This is quite a distinct group from immediate management, about whom questions are also asked, but whose proximity has less impact on engagement than the actions and behaviours of a handful of senior leaders who are often many miles (and layers) away. 

So what is it our employees expect of us these days? Well, quite a lot actually, and it can be daunting and exhausting to deliver on.

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At ANZ, the key things our employees expect of their senior leaders are: 

• That we are competent enough to lead the bank (and no, the fact that we are in positions of leadership doesn't prove that - their perception is what matters).
• A requirement that we actively ‘role model’ the bank's five values (integrity, collaboration, accountability, respect and excellence) every day in all circumstances. Trying our very best is just not good enough. 
• That we honestly believe and demonstrate by our actions our people are critical to the bank's success. 
• That we can explain the bank's strategy in a way they can understand, is inspiring and motivates them personally to deliver. Therefore, they also value our ability to translate group-wide strategy into actions and activities that each of them need to do to achieve great performance. 
• Finally, they want to trust us - a fundamental need, but as we know, something that is not a right but has to be earned. 

As leaders, we may be tempted to mock this kind of feedback as soft, but we do have hard data to show actively demonstrating these behaviours will lift staff engagement. 

Given all the empirical evidence suggests the more engaged your staff are, the more discretionary effort they will give to their company - which in turn is likely to achieve productivity goals - it does seem worthwhile to give this opportunity a second look. 

Because we have had this evidence for some time, we elected to invest heavily in leadership development. This involved building an expectation of values-led leadership from the top. To support this all our senior leaders participate in an annual, 360 degree feedback to assess how well they are (or are not) role modelling our values. This data is used subsequently as input to determine their year-end performance ratings and pay outcomes. 

Well, that's that then. Get all those things done and we're sorted, aren’t we? 

Not really, because not only are we under pressure to meet the demands of our internal teams, but the external environment is changing too - and that is driving some quite new demands of our leaders that I have not seen before. 

Here's how I see the new world of leadership in a nutshell. 

We all got to our current positions by doing many of the jobs that now report to us. As a result, most of us can deal with the issues that come up day to day and even the unusual events, as we've been round the block and seen variations of them before. But let's consider the Digital Revolution that is creating a new world in which many executives have no prior experience to draw on. 

Traditional leadership models of ‘command and control’ and an assumption the answers lie with a defined group of experts are being tested in a world where information flows are uncontrollable and problems are new, complex and often interdependent. 

So, further challenges for senior leaders are: 

• A need to admit that something really important to your business and customers is something you only partially understand (aka a large dose of humility);
• The people who can help you be successful could be many layers down from you, so traditional hierarchy becomes meaningless; and
• Somehow, you have to find a way to harness the collective talents of a broad and diverse group of employees. (More of that in a future article). 

So, let me just ask one more time – “who wants to be the leader?”