Is leadership prepared to face tomorrow’s critical issues? Not quite.
A confluence of economic uncertainty, geo-political risk, and talent challenges will test leadership teams over the next 12-18 months.
Our analysis of 20 external factors impacting organizational health across the next 12-18 months shows the relative importance of threats cited by global business leaders and how prepared they believe their organizations are to address them.
Three key and inter-related threats rise to the fore: uncertain economic growth, geopolitical uncertainty, and talent/skill shortages. Coming off the back of a very challenging labor market, 72% of leaders cited the availability of key talent/skills as a top 5 threat to organizational health over the next 12-18 months. This threat rose 13 percentage points since 2021. Uncertain economic growth and geopolitical uncertainty were the next two most frequently cited threats, the latter rising seven places in the ranking – likely propelled by Russia’s invasion of the Ukraine. Unfortunately, these three top threats also rank amongst the issues that leaders are least likely to say their leadership teams are prepared to face.
High rates of inflation, commodity price volatility and supply chain disruption are creating a very challenging business environment. Talent will continue to be a critical battleground. Cost-of-living increases create upward pressure on wages, and while some talent shortages may abate, talent with critical skillsets will no doubt remain in high demand as organizations depend on them to build the resilience needed to face economic headwinds.
Analysis of our data and expert perspective reveals a set of key implications for leadership teams as they navigate economic uncertainty – how leaders engage, enable, and inspire their people will be key.
Relative Importance of Factors vs. Leadership Preparedness to Respond
% of leaders
View a YoY Comparison of Threats to Organizational Health Download Chart
Three Big Stories in 2022
Our analysis of each of these threats uncovers a set of important leadership implications.
Economic UncertaintyLeadership cultures that engage constructively with digital and sustainability opportunities are better prepared for economic ups and downs. Learn more |
Geopolitical RiskLeaders need to engage much more deeply in “just-in-case” scenario planning and engineer flexibility into their business and operating models, recognizing that short-term efficiency and profitability may take a hit. Learn more |
Talent CrunchNext-generation leaders are critical to leading in a more purpose and people-oriented paradigm, but they themselves are a huge retention risk. Learn more |
Our experts say...
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Kimberly Archer
Washington, D.C.
"Leaders need to be positive, but also pragmatic and transparent, creating the right environment and culture for people to succeed. Help everyone see their potential, understand what they need to succeed, and trust and invest in their capacity."
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Anita Wingrove
Melbourne
"Strong succession plans depend on being clear what future leadership success looks like; understanding and tailoring development that speak to their ambitions and development priorities; and the ability to build strong connective tissue between successors and sponsors."
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Jamie Hechinger
Washington, D.C.
"CEOs must understand how much confidence and clarity there is. Especially in a hybrid environment, identifying where sources of disconnect and echo chambers exist, and actively overcoming them, is critically important to driving organizational cohesion."
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Laura Sanderson
London
"The opportunity and necessity of digital transformation and sustainability transformation is huge. Not only can technology be an enabler of sustainability, but the necessary culture of agility and learning orientation is the same for both."
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Ben Shrewsbury
Dallas
"Your supply chain is only as agile as your supply chain leader. Efficiency, cost to serve, and speed remain important but … flexibility, cultural awareness, an enterprise mindset, and technology savvy are fast rising as differentiating competencies of operating executives."
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Alvin Chiang
Singapore
"Leaders that have been successful in navigating the complexities of supply chain disruption, zero-covid policies in China, and labor shortages due to restrictions on movements, are those that surround themselves with colleagues who challenge their biases and cover their blind-spots."
Kimberly ArcherWashington, D.C.
"Leaders need to be positive, but also pragmatic and transparent, creating the right environment and culture for people to succeed. Help everyone see their potential, understand what they need to succeed, and trust and invest in their capacity."
Anita WingroveMelbourne
"Strong succession plans depend on being clear what future leadership success looks like; understanding and tailoring development that speak to their ambitions and development priorities; and the ability to build strong connective tissue between successors and sponsors."
Jamie HechingerWashington, D.C.
"CEOs must understand how much confidence and clarity there is. Especially in a hybrid environment, identifying where sources of disconnect and echo chambers exist, and actively overcoming them, is critically important to driving organizational cohesion."
Laura SandersonLondon
"The opportunity and necessity of digital transformation and sustainability transformation is huge. Not only can technology be an enabler of sustainability, but the necessary culture of agility and learning orientation is the same for both."
Ben ShrewsburyDallas
"Your supply chain is only as agile as your supply chain leader. Efficiency, cost to serve, and speed remain important but … flexibility, cultural awareness, an enterprise mindset, and technology savvy are fast rising as differentiating competencies of operating executives."
Alvin ChiangSingapore
"Leaders that have been successful in navigating the complexities of supply chain disruption, zero-covid policies in China, and labor shortages due to restrictions on movements, are those that surround themselves with colleagues who challenge their biases and cover their blind-spots."
MethodologyEvery year, Russell Reynolds Associates administers The Global Leadership Monitor, an annual survey of executives and non-executive directors, which tracks key threats to organizational health and leadership preparedness to face them, as well as indicators of confidence in leadership, and leaders' engagement and career aspirations. Learn more |
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Authors
Jemi Crookes and Tom Handcock of RRA’s Center for Leadership Insight conducted the research and authored this report.
Learn more about the authors and The Center for Leadership Insight
The authors wish to thank the 1,500+ leaders from RRA’s global network who completed the 2022 Global Leadership Monitor. Their responses to the survey have contributed greatly to our understanding of leadership in 2022 and beyond.
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Preparing leadership for tomorrow’s critical issues.
2022 Global Leadership Monitor
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