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Leadership as the biggest opportunity and risk in future

The biggest opportunity and risk in future is leadership.  If there is one thing we have learned about corporate and governmental success and failure over the last thirty years it is that organisational performance, whether private or public sector depends on leadership. Governmental performance depends on leadership. There is a direct correlation between sustainable economic growth and competitiveness in the world, and the quality of a country’s leadership. While some economies may achieve short term growth with mediocre leadership, it is simply not sustainable.  The best companies and the best countries have the best leaders.  Therefore, the best bulwark against corporate and national governance disasters is good leadership.  Thus, companies should invest more in leadership development. While senior leadership development should indeed be prioritised, all leaders – middle managers and supervisors alike should be developed.  In addition, we need more leaders who do not necessarily have the title of a manager, but who provide leadership with the quality of their work.  The best scientists, product developers, IT specialists and other experts also need to be developed as leaders.  Brilliant ideas, concepts and experiments bring us nowhere if the right decision-makers are not influenced to buy and champion great ideas.

Too many organisations and too many countries have under-performed because of poor leadership.  Hence, poor leadership is the biggest risk in organisations. They cost their organisations millions, and they cause damage to society at large.  The appointment of poor leaders cannot be perpetuated.  Now is the time to appoint leaders with the greatest potential and then to develop them continuously in realising their potential for the benefit of their organisations, its people and other stakeholders, and society at large.  Moreover, all leaders need to be trained in Risk Management, given the fact that they themselves pose the biggest risk to business, and secondly the important role they fulfil in managing and governing risk at their organisations.  Ideally such training should include a module on HR risk management. If top leaders can manage HR risk and leverage opportunities for their people, businesses will thrive. The creation of mature risk cultures will be the most important contribution of business and HR leaders to successful risk management in organisations.

Sooner or later national governments will realise that competitiveness, economic growth, political stability and prosperous societies depend on the quality of its human capital. Poor government policy and ineffective implementation of national strategies will not produce an adequately supply of human capital.  It is imperative that all obstacles to the provision, development and optimisation of human capital be removed.  While some leading companies have made excellent progress in developing corporate talent management strategies, the public sector needs to come to the party by developing similar talent management strategies.   Also, countries now need talent management strategies at a country level, by mobilising all relevant stakeholders such as learning providers, universities and other talent building centres to holistically produce and develop talent for a country.

This article highlights the fact that leadership is simultaneously the biggest risk and opportunity in future. Many recent examples of government and corporate scandals and failures, including the failure of small businesses, clearly demonstrate this reality. On the positive side, leadership is also the biggest opportunity in business.  If we appoint and develop the best possible leaders, we are setting our organisations up for future success. It is in this spirit that the South African leadership standard has been developed to protect organisations against leadership failures, and to guide leaders on the leadership practices necessary to ensure the success of leaders and their organisations.

The launch of the South African leadership standard on 26 October is therefore an historic moment in our history – it is a significant milestone in which local leaders have committed to guide one another towards leadership excellence. The development of the leadership standard will be remembered as the moment South African leaders decided to prioritise leadership as their biggest risk and opportunity – a milestone that is likely to sustain organisations and ensure a brighter future for South Africa and its organisations.

Marius Meyer is CEO of the SA Board for People Practices (SABPP) and Penny Abbott is a Research and Policy Advisor at SABPP.  This article is an extract from their new book “HR Risk Management: Managing People Risk and Leveraging Opportunities” written by Marius Meyer and Penny Abbott to be launched at the 5th Annual HR Standards conference on 26 October (see for more information.

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