A good majority — 87 per cent — of business leaders today feel their role is more challenging now than it was five years ago, according to a survey by Robert Half Management Resources of 270 CFOs in Canada.
“Facing an ever-evolving corporate landscape, executives have to deal with the pressures of emerging trends that require them to continually reassess everything from technology and staffing challenges to regulatory demands and compliance requirements,” said David King, Canadian president of Robert Half Management Resources in Toronto.
The results are not surprising, according to Vince Molinaro, global managing director of strategic solutions at Lee Hecht Harrison Knightsbridge in Toronto.
“We’re finding leaders at all levels really are feeling under greater pressure, greater scrutiny and I think that’s a reality of leadership today,” he said.
“The world of business, our world as a whole, has become more complex and in complexity, there’s a pace of change, and you put those two together and things are not as clear-cut as they used to be, so that’s one of the challenges.”
Competition is also that much harder, according to King.
“There was probably a time where you could have identified, over the course of a decade, the same competitor group that you had to keep eye on, if you will. Now, with the onset of both technology and innovation, we are seeing some very different business models being offered to take advantage of a possible marketplace opportunity where traditional competitive structures are not the case anymore,” he said.
“That type of need to keep an eye on the competitive landscape is a much more dynamic exercise than it would have been historically.”
People are being stretched to the limit, according to Ian Collyer, a partner at executive search firm Boyden in Toronto.
“It’s a far more complicated world than it was when you ran your company 10 years ago.”
One of the big challenges is technology, which is ever-changing, said King.
“There’s always new technology being introduced and one of the biggest challenges is making sure that, as an executive, you fully understand what that technology really can do, what the capabilities are and, to some extent, not to be distracted by the actual innovation of the technology or capability of the technology but making sure it actually does align with what your business strategy is and that it actually does benefit the business,” he said.
“They have to vet it properly and they also have to ensure that there’s an adoption rate that allows for growth from that adoption, growth as a business.”
Technology is probably one of the top three issues on the agenda for leaders when it comes to industries such as financial services, industrial and consumer products, said Collyer.
“Technology’s actually a strategic part to their business and growing their business.”
Companies have more data now than ever before, whether on customers or their own business, he said.
“There’s a pressure on the CEOs and the understanding they have this tremendous opportunity but also the question of: ‘How do we harness this? How do we harness the data we have to better drive our business?’”
It’s trying to sort through the hype around big data, and the promise of it, and then trying to use good data to make decisions, said Molinaro.
“What sometimes may happen is it might lead someone to not end up trusting their own judgment on certain situations, and so that’s something that will continue to emerge because I think what we see with leaders is by the time they’ve got all the data, it’s too late — they need to make decisions quickly, in real time. We’ll get better as new solutions come out around leveraging big data and using the insights for effective decision-making… But, in the meantime, it’s sorting through all the data points, trying to make sense of it.”
Overcoming staffing challenges is another issue facing business leaders, according to King. With reductions in unemployment, and particularly low numbers in some sectors, finding top talent can be difficult, he said.
“What also has changed is the onset of various demographics working now in the workforce and that has certainly changed what is expected from the workforce, what they need from an organization to remain engaged — the type of diversity and engagement points they require. It’s certainly no longer good enough to pay well, people aren’t just going to stick just to that, it’s got to be so much more than that.”
However, there’s always been a war for talent, said Collyer, who’s not sure that issue is more challenging today than it was five years ago. There are certain industries, however, that have shifted their business, such as GM having a large software development team, probably because Apple is hiring automotive professionals, presumably to build an Apple car, he said.
“There’s worlds colliding, I’ll say, there’s new competitors emerging that weren’t around five years ago for a lot of industries, but there’s also lots of new opportunities out there for these organizations.”
With millennials, there’s a greater expectation to work with great leaders — otherwise, they’ll leave, unlike baby boomers who tended to stick around even with a tough boss, said Molinaro.
“Now, the pressure is people are far more mobile.”
Organizations are also structured differently, he said.
“As organizations grow and become more global, it introduces the complexity of matrixed organizations and that adds a level of challenge for people, that adds pressure, in that more and more work is being done virtually with colleagues that maybe you haven’t met before.”
Regulatory pressures also continue to mount, according to Robert Half, with executives not only required to know the mandates affecting their business but how compliance can help a firm prosper.
Industries such as financial services have seen the onset of a high regulatory and compliance environment, meaning significant challenges and costs, said King. And while people appreciate that changes were required, there is debate as to how much is too much when it comes to the regulations.
“Potentially, is the high-compliance regulatory environment maybe taking way from other investment opportunities because (leaders are) having to spend so much time and focus on that part of the organization? So… organizations are having to find a way to embrace it and get their arms around it while still having it be part of regular business operations.”
And for public companies, the investment community is demanding more when it comes to information and transparency, he said, “so simple things like an annual report package… is that much more involved and that much more detailed with regard to the organization’s operations.”
There’s also the issue of risk, as seen in the investment industry, for example, where companies face greater complexity and scrutiny, said Molinaro.
“Everyone has a heightened sense of maybe even anxiety around some of these things because… the risk is greater. And social media adds another level of pressure — Glassdoor (for example), where people are being evaluated publicly, companies are being evaluated, all of those little things add up and, in many cases, weren’t around five or six years ago.”
The work of leaders has also expanded in recent years, so executives must draw on their business acumen to understand how their unit’s decisions and performance affect the broader organization, according to Robert Half.
“It’s generally recognized that an organization that has healthy cross-collaboration from departments and functions is seen as being stronger,” said King.
“It is always certainly preferable if somebody in sales can have an appreciation of what that means in operations if they were to make a critical decision as a sales strategy, for example. From a leadership standpoint, that has a demand on them to both encourage that collaboration in their various groups.”
More and more C-suite executives having travelled on a career path that is not so linear, right in their own function, he said.
“They have often gone into other functional areas to gain insights so they can be a more well-rounded executive.”
CFOs are becoming more like business leaders, so they’re more embedded in the business operation and their decisions aren’t just in the silo of finance, said Collyer.
“It’s across the business, so they’re looked to be more strategic business leaders,” he said.
“The right organizations are looking to provide CEOs more exposure to the business, across the entire business, so they get operating experience. You’re a true business partner; you’re just not relied on as a finance person.”
Despite the challenges and pressures, it’s important to remember leadership roles provide opportunity and can have a real, significant impact on the success of an employer, said Molinaro.
“That message needs to counterbalance all the messages that might freak people out about wanting to take on a role like that,” he said. “It’s not an easy job but it can be a great job if you’re fully committed.”
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