Developing the Next Generation of IT Leaders: Opportunities and Challenges

26 Nov 2018

Developing the Next Generation of IT Leaders: Opportunities and Challenges

According to a recent Conference Board survey of 561 CEOs in 50 countries, failure to attract and retain talent is now cited as being the number one business concern of the C-Suite. What was once mainly the concern of the human resources team has now become a challenge for the entire leadership team – and Canadian CIOs are finding the current talent shortage particularly concerning.

Eric Beaudan, Global Head of our Leadership Practice, along with Partners Susannah Crabtree and Anthony Batchelor recently facilitated a discussion with a group of CIOs from the CIO Strategy Council to discuss the challenges and opportunities for attracting and developing the next generation of IT leaders.

Generational Differences Create Inherent Bias

One of the factors complicating talent acquisition is the generational differences of Baby Boomers, Gen X and Millennials within teams. It’s a common belief that these three groups hold different world views and that this impacts their behaviors and motivation, from management and leadership styles, to relationships with authority.

Susannah highlighted that while Baby Boomers and Gen-X executives often observe the differences of Millennials, there needs to be a greater level of acceptance that this generation is quickly becoming the majority of the global workforce. Millennials are quickly stepping into leadership roles ten years earlier than the previous generation did. One CIO at the event pointed out that very soon we won’t be talking about ‘Millennial leaders’, but simply, ‘leaders’.

While this transition is occurring, current leaders working to attract and lead are feeling tension because their methods for motivating employees aren’t working as well. CIOs--and other executives across the C-Suite--need to begin rapidly adapting talent processes and leadership practices to accommodate this shift.

The War for Talent is Really Two Wars

But attracting the right talent is only half the battle. As the Odgers Berndtson team shared, one-third of new employees quit within the first 6 months, so the battle to retain talent is just as challenging. Moreover, an IBM survey revealed that 16% of employees are actively seeking a new job.

So why are employees leaving companies? Contrary to traditional misconceptions, it’s not usually a lack of compensation that is turning employees away, but rather a lack of opportunity to advancement, dissatisfaction with senior management or the work environment and the culture.

As Eric shared, one of our research reports in collaboration with Forrester Research corroborates the last point that, “even if you attract great talent, you’ll quickly lose them unless you have a culture that nurtures their creativity.” The cost of losing intellectual capital can be crippling for organizations and so it has become a matter of survival for leadership teams to reduce turnover and boost retention.

Acquiring the Right Digital Talent Has Become a Matter of Survival

The reality is, almost all organizations are trying to navigate a digital transformation of some sort, and talent acquisition in the IT space has become more critical than ever before. This is because a company’s digital talent needs to be able to drive the digital business strategy which-- looking forward to a future enabled by artificial intelligence, automation and the Internet of Things (IoT)--will be one and the same as the organizations’ business strategy.

A survey of more than 3,000 CIOs, conducted by Gartner, underscores this point: “The first part of the new job of the CIO is to build the required bench strength to scale the enterprise’s digital business through support for the digital ecosystems.” As a key driver of business strategy, CIOs are being challenged to deliver value on a number of fronts, and as a result need to think of culture and talent development as critical to the execution of their strategy and technology roadmap. They need to be asking questions like: “Which new technology is likely to disrupt our business model? Does our strategy reflect the changing local-global reality? Do we have the right people with diverse backgrounds and leadership skills? And how will we manage the shift to a new generation of leaders?” These questions are all critical to building a plan for growth, enabled by digital.

In our recent 2018 Digital Business Report, Forrester identifies that digitally advanced organizations are achieving significantly higher growth rates than their less mature counterparts, with at least twenty-one percent of them growing by twenty percent or more annually. And what role does digital talent play in this equation? The report also uncovered similar success gaps between those companies who have the right talent to drive digital strategy, versus those who do not. Ninety-one percent of “digitally advanced” companies feel that they have the necessary people and skills to execute their digital strategy, versus seven-percent of digital beginners. As Eric noted, this emphasizes that there is a strong correlation between digital talent and organizational growth.

How Are Top Global Companies Developing Talent?

Having the right business strategy in place and fostering a culture of creativity and innovation are foundational to attracting the right IT talent. But CIOs need to look beyond talent acquisition and consider how to develop and retain those leaders who may become tomorrow’s executive team.

According to Aon Hewitt, succession planning and leadership development are a key strategic investment for several top global companies. Organizations who are seeking to future-proof their senior IT leadership should focus on identifying which roles will be critical for future success, assessing current leadership skills gaps, and creating and developing a pool of high-potentials.

Best Practice in Succession Planning & Development

Global Top Companies

All Other

Development of high potential pool



Assessment of leadership skills gaps



Clear identification of critical roles for future success



Development of successors for specific positions



Identify leader’s current performance vs future potential



A ready now vs ready future rating system



360-degree feedback



Communication of accelerated development plans




Source: Aon Hewitt Survey of Fortune 1000 Global Companies, 9 Dec. 2015 by Stephen Hickey

Leveraging these succession planning and development best practices--practiced by leading Fortune 1000 companies---will help organizations build their leadership bench strength in talent areas that will be critical for their future success, like IT. McKinsey also recommends frequently reallocating high performers to the most strategic priorities as another talent development strategy, and cites that “fast talent reallocators were 2.2 times more likely to outperform their competitors on total returns to shareholders than were slow talent reallocators.”

How Can We Better Prepare Less Experienced Leaders for More Senior IT Roles?

For millennial managers and leaders moving into more senior IT roles, all the CIOs agreed that the most important quality to look for and develop is a mindset around business transformation.

With digital transformation well underway for some organizations and looming ahead for others, it has become critical that IT leaders can communicate how technology is not a cost to be managed, but rather a strategic arm that will help guide the business into the future. IT leadership desperately needs communicators and strategists who can explain the art of the possible to the rest of the C-suite and board. IT needs visionaries who can look ahead to see what additional value the organization can deliver with the technology of tomorrow.