Global Leadership Forecast 2018

25 Research Insights to
Fuel Your People Strategy
China

Global Leadership Forecast 2018 | China Report

Actionable Intelligence for Leadership Imperatives
Global Leadership Forecast 2018—a three-way collaboration with Development Dimensions International (DDI),The Conference Board, and EY—is the eighth Forecast since DDI began the stream of research in 1999. It’s also oneof the most expansive leadership research projects ever conducted. This report summarizes dozens of practical,
evidence-based recommendations for critical business issues. These range from digital transformation to genderand generational diversity to the roles of purpose and culture in building an effective, sustainable leadershipstrategy for a digital age.
The research integrates data from 25,812 leaders and 2,547 HR professionals across 2,488 organizations. Not only
are these perspectives numerous, but they are also diverse and highly representative of the business context
facing global enterprises. The research, which spans more than 1,000 C-level executives and 10,000 high-potential
employees, includes 54 countries and 26 major industry sectors. Our full set of leader demographics is depicted
below.

Leader Demographics
20% Millennial

First-Level Leader 41%
Mid-Level Leader 31%

62% Generation X

18% Baby Boomer

Lea
de
rL
ev
el

ion
rat
e
en
G

High-Level Leader 23%
Senior-Level Leader 5%
Automotive & Transport 12%
Energy & Resources 5%

17% China
7% Japan

14% Latin America

try/Region
Coun

25% Southeast Asia

25,812 Leaders
2,547 HR Professionals
2,488 Organizations

16% US/Canada/Puerto Rico

31% Female

Manufacturing 18%

Other 28%
Pharmaceuticals 3%
Professional Services 6%
Retail 5%
Technology 7%ader

8% Europe
4% Australia/NZ
2% Africa/Middle East

Health Care 6%yIndustr

7% IndiaFinance & Insurance 10%

Ge

nd

-Po
High

er

69% Male© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

ten

l
ti a

Le

Yes 48%

No 52%

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Global Leadership Forecast 2018 | China Report

GLF Insights for China
As part of the larger Global Leadership Forecast 2018 study, this report highlights findings on the current stateof leadership and leadership practices in China. Based on survey responses from 3,404 leaders and 478 HR
professionals, these results provide actionable insights specifically for China’s leadership context and businessmarket.
Throughout this report, findings are presented for both China as well as the global sample of leaders. Where theglobal results are presented, they will be accompanied by the global icon [ ] to indicate findings are based on the
global sample of leaders or HR professionals. Unless accompanied by the global icon or otherwise noted, findings
throughout this report can assumed to be specific to China.
Not all findings from the Global Leadership Forecast 2018 are specific to China and provided in this report. As
such, please refer to the global report for the full set of actionable insights. The global report can also be used as
a comparative benchmark for China-specific findings presented in this report. We are confident these results will
provide new insights for China’s leadership practices and hope the report will stimulate your own ideas about how
to enhance your organization’s leadership capabilities.

China Leader Demographics
First-Level Leader 51%

Le
ad
er
s

er

Mid-Level Leader 26%phi

70% Male

l
ve
Le

Ge
nd

30% Female

High-Level Leader 21%

3,404 Leaders

Senior-Level Leader 2%478 HR Professionals
io

-

Po

er

gh

at

Hi

54% NonMillennials 34%

St

atu

G

en

Generation X 4%sBaby Boomers 62%

46% Yes© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

A Research-Driven Road Map for Leadership Acceleration
China insights from the Global Leadership Forecast 2018 center on 25 findings (listed in the Table of Contents on
the facing page) about the state, context, and future of leadership. The findings are clustered into six categories:

1

Leaders at the Core—leadership and talent are top agenda items for CEOs, and the readiness gaps continue
to be significant.

2

Digital & Data—how digital and data-rich business contexts accelerate the need to build the right capabilities
to thrive.

3

Growth & Potential—proven practices for aggressively developing leader talent and bench through a robust
learning and growth engine.

4

Leader Diversity—understanding and advancing gender and generational diversity in leaders to achieve thediversity dividend.

5 Cultural Drivers—the powerful forces that can propel—or if lacking, will cripple—rapid, disruptive change.
6

The HR Opportunity—how HR can elevate and extend its influence on business outcomes to deliver on thisstrategic agenda.

Each of the 25 findings shares a common format: We describe the context for the business issue, visualize the key
data, describe the key leadership implications, and provide specific guidance for converting research evidence torecommended actions of two types:
First, “Where to Start,” practical steps that organizations can take now to build, reinforce, or remedy theirfoundation for evidence-based leadership practices and systems, drawing on notable outcomes from theresearch. Typically, these are actions that many—but far from most—organizations have in place, but thatare often overlooked as key building blocks on which more advanced elements of leadership strategy rely. That is,though they’re often common sense, they’re rarely common practice.
Second, “How to Excel + Differentiate.” The research’s wide-reaching scope includes hundreds oforganizations that are prototypes for rapid advancement toward one or more challenging leadership andbusiness objectives: digital transformation, gender diversity, high-potential management, people analytics,
and instilling a sense of purpose, among many others. This section of each finding shows howorganizations can draw on proven, high-impact leadership practices to gain a sustained competitive advantage by
harnessing their leaders’ potential at all levels and from all backgrounds.
After the 25 findings, which are designed to be modular and self-contained so that they can be used
individually, we close Global Leadership Forecast 2018 with two integrative summaries:• First, an integrated view of six leadership megatrends—core, overarching themes that we found emerging again
and again across the findings—that collectively chart a course for the trajectory of leadership and serve as broad
guiding principles for leadership-directed action.
• Second, a leadership practices scoreboard showing the “in-place” frequency of 34 leadership practices in China
and the links from each to three critical outcomes: Leadership Program Quality (in the eyes of the leaders/learners who are the “customers” for these programs), Leadership Bench Strength (supply of ready-now leaders
to fill critical roles over the next three years), and Financial Outcomes (an externally gathered composite ofoperating margin, EBITDA, revenue growth, and return on equity).

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report© Development Dimensions International, Inc., The Conference
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Global Leadership Forecast 2018 | China Report

Table of Contents
Leaders at the CoreFor CEOs, It’s Still About Developing Leaders: Strategy Is Nothing Without Effective Leaders to Execute............ 4
Leader Capability Stalled Again: Chinese Corporate Leaders Made Limited Progress in the Past Six Years........... 6
Leadership Strategy: The Forgotten Foundation of Business Planning.....................................................................................8
Purpose-Driven Leadership: Inspiring and Leading in a Complex Environment..................................................................10

Digital & Data
Digital-Era Leadership: Leaders Need to Release Future Talents’ Potential......................................................................... 12
Accelerating the Digital Journey: Changing Old Leadership Mindsets and Ways of Working.......................................14
Leading with Data-Driven Decisions: The Culture and Skills Driving Higher Returns on Data.......................................16
Why Technology Leaders Are Failing: The High Cost of Low-Chance Development........................................................ 18

Growth & Potential
Rethinking Leadership Potential: 10 Ways to Elevate High-Potential Leaders.....................................................................20
Meeting the Needs of the Modern Learner: Technology Gains Its Footing, but It’s a Slippery Slope........................ 22
Making the Most of High-Potential Talent: Avoiding a Mismatch Between What They Want and Get...................... 24
Performance Management: Are Ratings Overrated for Growing Leaders?........................................................................... 26
Want to Be a Leader? Get an Early Start............................................................................................................................................. 28

Leader Diversity
The Rise of the Digital Natives: Are Millennials Ready to Lead?................................................................................................30
Generation X-Change: Don’t Underestimate the Powerful Influence of Gen X Leaders.................................................. 32
Diversity Leaders: Digital Transformation Starts from Inclusive Culture ...............................................................................34

Cultural Drivers
Build a Coaching Culture: Want to Be a Better Leader? Ask a Peer or Employee.............................................................36
Mentoring for Impact: How to Maximize a Critical Leadership Experience...........................................................................38
Collective Leadership: Leading for Value Across Organizational Boundaries.................................................................... 40
It’s Time for Teams in Leadership: The Power of a Shared Leader Perspective.................................................................. 42
Adjusted for Disruption: Top Drivers of Organizational Success Through Complexity and Change..........................44
No Engaged Workforce Without Engaged Leaders: China Companies Need toGrow Cultures that Encourage Employees..........................................................................................................................................46

The HR Opportunity
HR’s New Role: Are Chinese HR Up to the Challenge?...................................................................................................................48
HR Under Pressure: Falling Behind in the Race to Transform ....................................................................................................50
People Analytics: HR Mastering Data Analysis, Increases Promotion Chance by Six Times.......................................... 52
Leadership Megatrends and Payoffs......................................................................................................................................................54© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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For CEOs, It’s Still About
Developing Leaders
Strategy Is Nothing Without
Effective Leaders to ExecuteMore than 1,000 C-level executives, worldwide, identified the issues they expect to command their attention in the
coming year. Of the 28 challenges from which they could choose, their biggest concerns weren’t headline-worthy
global issues like political instability, climate change, terrorism, or a global recession. Rather, the top challenges vying
for leaders’ action focused on their own leaders. Developing “Next Gen” leaders and failure to attract/retain top talent
were rated in the top five by 64 percent and 60 percent of global respondents, respectively. In China, developing“Next Gen” leaders and failure to attract/regain top talent were rated as key challenges by 51 percent and 51 percent,respectively.
China is leading the world in digital technology and applications, but it also brings destructive innovation andcompetition to all walks of life, resulting in the phenomenon that traditional industries are striving for transformation
one after another. Even enterprises in the Internet industry dare not to take it lightly. They constantly pursue new
business mode, because in the Internet Age, if they cannot be the best, they would be eliminated.
Leaders clearly indicated that top talent and effective leaders will be needed to address the myriad current challenges
and to position their organization for future success. The global Top 10 Challenges are shown below along with thepercent of global and China executives that rated each challenge in their top five.

Developing “Next Gen” leaders

51%

Failure to attract/retain top talent

51%
48%
47%

New competitors globally

Slowing economic growth in emerging markets
Labor relations
Global recession
Income inequality/disparity

Global political uncertainty

64%
60%

28%
26%
25%
21%

Cyber-security

Outdated/Insufficient national infrastructure

China

GlobalTop 10 Challenges

6%
0%

24%
26%
22%
28%
21%
21%
20%
18%

© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

most critical skill leaders will need in three years. In
China, identifying and developing future talent was
ranked as the number 1 skill leaders will need in the near
future. A significant gap exists between the criticality ofthis leadership skill and leaders’ own assessment of theirability to successfully master it. The net result would be aweakened leadership cadre. Only 25 percent of China HR
professionals rated their organization’s bench strength—
the supply to fill critical leadership positions over the
next three years—at any level of strength (slightly strong,strong, or very strong) and, on average, only 38 percent
of positions could be filled by an internal candidate
immediately. Twenty-five percent believe their succession
management system and processes to be of low or very
low effectiveness.

These findings are consistent with The Conference
Board’s 2017 CEO Challenge* study, which asks thesame question of global CEOs each year. In 2016 and2017, these two challenges placed among the top fivechoices globally. Senior leaders are acutely aware of theimportance of focusing on strengthening human—and,specifically, leadership—capital.
Of those China leaders surveyed in Global Leadership
Forecast 2018, only 47 percent believe their organization’s
leadership development program to be of high orvery high quality, with 44 percent rating “leadershipassessment” and 46 percent rating “leadershipperformance management programs” to be of high orvery high quality. Average program quality translates intomoderate confidence in leadership effectiveness. When
asked to consider their own effectiveness in the criticalleadership skill of identifying and developing future
talent, 56 percent of respondents rated themselves highly
effective or very highly effective, which leaves 44 percentof leaders (those who are only moderately effective,
or even less skilled) to shape the next generation. And
with 31 percent never having been mentored, how do
we expect that they’ll know how to mentor others?
Concerning these two important leadership abilities
related to the development of future talents, theeffectiveness of Chinese leaders is far behind the global
level.

• Thirty-one percent have a weak or nonexistent
relationship between annual strategic plans and theirown plans to grow leadership talent.
• Fifty percent do not have well-integrated andstrategically aligned leadership development
programs or processes.
• Sixty-five percent see their leadership career planning/
pathing systems as only moderately effective or worse.
• Fifty-seven percent do not believe their leaders havehigh-quality, effective development plans.
• Forty-nine percent do not use information fromassessments and simulations to make leadership
hiring and promotion decisions.

Under the rapid growth, Chinese enterprises have
reduced the time for leaders to exercise leadershipin their work, but high-quality leadership requires
practicing time and a model as the target of learning atwork. This set of numbers tells us that although Chinesecompanies are leading the world in the quality of theirleadership development initiatives, it is more important
for them to rely on all levels of leaders to identify, coachand develop the next generation of talents at work, in
addition to relying on human resources departments/
enterprise universities, for cultivating high-quality
leaders.

• Thirty-one percent do not have a program to develop
high potentials, and 37 percent of those do notmeasure the effectiveness of the programs.
• Sixty-five percent do not exercise negative
consequences when leaders fail to develop leaders on
their team.
• Forty-five percent do not know the up-to-date statusof leadership talent capability across the organization.
* Mitchell, C., Ray, R.L., & van Ark, B. (2017, January), The
Conference Board CEO Challenge® 2017: Leading Through Risk,
Disruption and Transformation, New York, The Conference Board,
https://www.conference-board.org

HR Paints a Bleak Picture

More than 2,500 HR professionals across the globe told
us that identifying and developing future talent, is the

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• With all stakeholders, begin with a candid
assessment of all leadership development
programs and processes at all leader levels.

• Systematically monitor progress and gather
data to determine the business impact leadershipdevelopment processes have an advancing theorganization’s strategic goals.

• Create a plan to integrate all efforts withthe twin goals of supporting leaders’ successnow and building a solid pipeline of successful
future leaders against the profile yourorganization will need.

• Deepen the strength and quality of your leadership
bench.
• Partner with business leaders and the C-Suite todesign, deliver, and assess the effectiveness of allleadership-related actions. Enlist these individuals
as coaches, mentors, and champions.

• Create or update a leadership capability modelthat is embraced by senior leadership and alignedwith the organization’s strategic goals.
• Ensure that leaders have the skills to identify
and develop top talent.

• Adapt performance management processes to holdleaders accountable for successfully developing theirteams, particularly emerging leaders.

• Review and enhance other talent management
systems to support the creation of a strong
cadre of leaders.

• Continue to strengthen the ability of leaders at alllevels to “identify and develop a new generation oftalents”.

© Development Dimensions International, Inc., The Conference
Board Dimensions
Inc., EYGM Limited,2018. All
rights© Development
International,Inc.,
The reserved.
Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Leader Capability
Stalled Again

Chinese Corporate Leaders Made Limited Progressin the Past Six Years“Everything is different from today on.” So, supposedly, said Austrian composer Joseph Haydn after hearing
Beethoven’s Symphony Number 3, the Eroica, more than two centuries ago. While many who first heard it wereshocked, it changed the very essence of classical music and went on to be one of the world’s most beloved symphonies.
The quote aptly reflects today’s leadership landscape. Never in the nearly 20 years we’ve been collecting data for
the Global Leadership Forecast have we seen the array of forces that are disrupting the essence of great leadership.
“Competitive pressure to innovate and shake up established markets is too powerful for companies and the people who
lead them to ignore.”* And, never has the quality of our leaders guided us into an as uncertain future ever.

Leaders Ready for Today? And What About Tomorrow?
We’ve followed perceptions of leadership capability over the years that indicate organizations’ progress in building
stronger leadership capability. Are they improving? Despite billions spent on leadership development annually, theanswer, yet again, is NO!
As shown in the figure at left, little has improved in overall organizational leadership quality as rated by 3,404 China
leaders. The percentage in the excellent/very good categories has hovered at around 25 percent since 2011. And when
HR evaluates the quality of their organization’s leaders, the number has risen to only 15 percent (a slight boost fromprevious years). Overall quality varies widely by country, industry, and level. Leaders, for example, rated seniorleadership quality considerably higher than the quality of those in first-level positions (56 versus 29 percent). This
> China Leadership Quality: Six Years Running of Little Progress
China

Global

38%
25%

40%
39%

2011

2014

42%
41%

2017

Percentage of leaders who say
overall quality of organization’s
leadership is high

25%
15%

25%
16%

30%
15%

2011

2014

2017

Percentage of HR professionals
who say overall quality oforganization’s leadership is high© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

also highlights the fact that, China’s rapid
development brings rapid promotion to
middle-level leaders, who lack sufficient
time to exercise their leadership skills
required for their positions. However,% high- % strong% high- % strong
the middle-level leaders are the strongest
qualityquality
futurefutureCountry leadership bench
Industryleadership bench
backbone of Chinese enterprises. In termsof strategy implementation, they are theASEAN
42Automotive
44
22
21
executors performing as a connecting link
China
41
Banking45
6
11
between the preceding and the following.
In terms of team leadership, While firstEurope
33
Energy/Utilities54
13
22
level leaders are less experienced in a
India
54
HealthCare
42
19
5leadership role, they’re likely to have themost profound impact on their teams’
Mexico51
Manufacturing
35
29
5
engagement and productivity.
US
50
Technology
41
14
12
We also took a forward view by asking
Note:
Qualitybasedonleaderratings;
bench
strengthonHRratings
HR to rate the strength of their current
Quality is very good/excellent; bench strength very strong/strong
pipeline to meet their business needs overthe next three years. The results are equally© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.
discouraging. Just 16 percent considered
their future bench to be very strong/strong
Dearth of current quality and projected future bench
in Global Leadership Forecast 2011. That
strength can hinder your organization’s ability to fillnumber dropped to 6 percent in this survey. A full 75
critical positions with ready-now internal leaders.
percent of HR respondents rate their future leadership
On average, China respondents feel they can fill only
bench as slightly weak or worse. Again, these ratings vary
38 percent of their critical roles with strong internalconsiderably by industry.
leaders, leaving them to search outside for often-costlier,
The figure to the right lists some key countries/regions
higher-risk external candidates.
and industries in terms of leadership quality and theAt the end of the day, we need to ask ourselves if
accompanying rating of future bench strength. One
these numbers have any real impact. It turns out thatthing is very clear: The current quality of leadershipcompanies in the top third of financial performers areearned higher marks than bench strength three years
twice as likely to have high-quality leaders than thoseout. This is also very paradoxical. Chinese companies
in the bottom third. This is a difference that can easily
are paying more and more attention to the quality oftranslate into millions of dollars for any single company.
leadership. They spend a lot of time and money toWhen all industries face unstable business environment
improve the overall leadership level of the enterprise.
and competition, the speed of corporate transformation
40% (not low) Leaders hold that the leadershipand innovation will be affected due to the lack of current
development program in their company is of highleadership quality, the lack of future leadership bench
quality. Then, why only 6% of HR believe that theirstrength, and the lack of competent leaders within thecompany has strong leadership bench strength? Given
organization who can immediately fill key leadershipthe seismic disruption in almost every industry, keeping
positions. It will also have a negative influence on theahead of the leader quality and quantity supply chain
enterprises’ ability of long-term financial performance.
will be a considerable challenge. Therefore, HR partners
should re-examine all leadership development initiatives* Hoque, F. (2015, November), 5 Habits of Truly Disruptive
to find a balance between the future and the present. In
Leaders, Fast Company. https://www.fastcompany.com/3052725/5addition to cultivating the leaders fitting to the current
habits-of-truly-disruptive-leaders
posts, we also need to have a long-term outlook andbuild the leadership bench for the future.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Analyze the strengths and gaps in yourleadership bench against your business goals.
This will enable you to better target your limited
resources while having the greatest impact on
your business.

• Consider a more systematic approach to developing a longterm leadership strategy connected to your business plan.
• Integration of talent systems is key. For example, superior
development will not compensate for poor hiring systems. No
matter the current post development, or the leadership benchstrength, performance management, selection system, or evenpromotion system, all of these different systems should be
integrated and connected by the orientation for future leaders.

• Keep your eye on disruptions to your businessand how they affect your success profiles. The
requirements for leadership excellence arechanging constantly.
• Become a champion at using predictive analytics
to improve the quality of hiring and promotion
decisions.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

9• A majority of organizations still do a poor job of measuring
the impact of their leadership development efforts.
Improvements will never come unless you know what aworthwhile investment is and is not! For example: the extent
of leader’s behavior change, the proportion of key leadership
posts filled by internal leadership bench, the proportion of
improvement in the performance of leaders, and the improving
level of employee engagement.
www.ddichina.cn/glf2018

Leadership Strategy
The Forgotten Foundation of Business Planning
Only 6 Percent of China CEOs Have the Leadership Talent to Execute Their Strategy
The data in Global Leadership Forecast 2018 shows that organizations with effective leadership talent outperformtheir peers. Yet very few organizations manage this high-value asset in an integrated, cohesive way. Even after spending
more than $50 billion annually* on developing their leaders, many companies still don’t have the bench strength tomeet their future business goals. And despite the spending, investments are often fragmented and see a lack of returns.
Leadership models and development programs abound; few tie to business goals. Worse yet, there’s scant evidence
that they actually work. What’s needed is a coherent, integrated leadership strategy. A well-crafted blueprint ensuresthat companies have the right talent, at the right cost, and with the right capabilities to deliver today and into the
future. Yet, we found only 31 percent of HR professionals in China feel their organizations have an effective leadershipstrategy. Companies that do have such strategies in place report better returns on their investment in talent. They
consistently feature deeper leader bench strength and stronger leaders at all levels.

What Differentiates Organizations
with Effective Leadership Strategies?
The advantages of having a leadership strategy in place are enormous, beginning with leader preparedness to meetbusiness challenges. The graphic at the far left shows the leader-readiness advantages of an effective leadershipstrategy.
> China Preparedness to Meet Key Business Challenges with an Effective and Ineffective Leadership Strategy
With an With an

Ineffective Effective

Business Challenges

Leadership Strategy Leadership Strategy

Anticipate and react
Responding to the competitive environment

23%

Understanding and acting

19%

Using data

8%
10%

14%

Operating in a highly digital business environment
Maintain effectiveness23%

Act decisively

16%
22%

Capturing organizational knowledge
China

21%

7%
4%
4%

21%

Navigating through complexity

Global

8%

18%

5%
4%
4%

27%
32%
27%
33%
26%
27%
22%
25%
20%
32%
18%
37%
17%
24%
16%
34%
13%
35%

Percentage of Organizations Ready to Meet Each Business Challenge© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

So, What’s in an Effective Leadership Strategy?

What Are the Performance Benefits?

Senior line managers define “leadership strategy” ashaving a supply of capable leaders to meet both theirshort- and (ever-changing) long-term business needs. A
sound leadership strategy consists of the four elements
defined below. We looked at the effectiveness ratingsfor each element, comparing organizations that reporthaving a leadership strategy in place with those that donot.

We found that an investment in formulating andexecuting an effective leadership strategy can have asignificant impact in several other areas:• Defines the competencies required for success.
We see a much higher level of effectiveness of thisbasic practice in organizations with a leadershipstrategy versus those with no strategy (77 percent
versus 43 percent).

• Of organizatio• Working with the business to articulate a leadershipstrategy improves HR’s strategic impact.
Organizations with a leadership strategy are 2.3
times more likely to rate their HR teams as strategic
advisors.
• ns with effective strategies, 35 percent have overallhigh leadership quality versus 5 percent with lesseffective strategies.
• Future bench strength, a critical lead outcome
measure, is much stronger with an effective strategy(14 percent versus a dismal 1 percent).

• Models supply and demand as part of thestrategic planning process. Organizations with aneffective leadership strategy are 6.3 times more likely
to adeptly forecast future leadership demand thanthose without.

• Stronger ability to fill critical open positions withinternal candidates (51 percent versus 33 percent). The
cost of even a few senior positions remaining open
far exceeds the investment required to put a soundstrategy in place.

• Ensures that all core leadership processes alignand are consistently reinforcing the appropriate
skills/capabilities/mindsets. All major talentsystems are more effective in organizations withstronger leadership strategies. For example, when
there is a leadership strategy in place, 50 percent oforganizations report having effective development
programs in place versus 13 percent in thoseorganizations with no strategy. The same magnitudeof difference applies to succession management (58percent versus 20 percent). These systems comprisethe foundation for delivering a steady flow of leaders
through the pipeline.

Should HR Be Involved in Strategic Planning?
Leadership strategy should never stand alone from anorganization’s strategic plans, yet only 26 percent of HR
professionals are involved in strategic planning from its
inception. This diminishes the role they can, and should,
play in connecting the business to required leadershipcapability.
* Kellerman, B. (2012), The End of Leadership, New York,
HarperCollins.

• Measures the impact of leadership spendingon performance and potential. Companies witheffective leadership strategies are 3.8 times more likely
to gather business-impact measures on their talentinitiatives.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Translate your strategic plans into leadershipand talent implications. Assess risks and areas
where poor leadership capability will impede
execution.

• Use accurate leadership assessment tools. These
tool are used to predict the insufficiency ofleadership bench in the face of the future, The tools
willhelp you focus better on the direction you need
to work on.

• Focus on execution. Like any other strategy,
leadership strategy often fails more due to lackof execution than integrity. Make sure to align allcomponents of successful execution: rewards,
metrics, resources, and skills.

• Orchestrate all components of your leadershipstrategy. They do not stand alone. Forecasting
demand is worthless without accompanying
initiatives to close the gaps.

• Look carefully at deploying initiatives acrossthe enterprise. Ensure the most efficient andeffective deployment of your limited resources.

© Development Dimensions International, Inc., The Conference
BoardInc., EYGM Limited,2018.International,
All rights reserved.
© Development
Dimensions
Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• Prove the return on your leadership investment.
Unlike every other function, HR typically fails toseriously evaluate (and thus justify) the impact of
their spend on organizational performance.

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Purpose-Driven Leadership
Inspiring and Leading in a Complex Environment
Purpose is an aspirational reason for being that inspires and provides a call to action for an organization, its partners,
stakeholders, and society as a whole. EY Beacon Institute research* has consistently shown that purpose enables
organizations to perform well in times of volatility. The research joins a growing body of evidence demonstratingthat a strong and active purpose raises employee engagement and acts as a unifier, makes customers more loyal andcommitted to working with you, and helps to frame effective decision making in an environment of uncertainty.
Global Leadership Forecast 2018 finds that getting purpose right builds organizational resilience and, crucially,
improves long-term financial performance as seen in the figure below. We found that the real benefits come whenleaders walk the walk by behaving in a manner that exemplifies their organization’s purpose.

> Impact of Purpose on Financial Performance

Financial performance(on compound measures)+42
Average-42

Purposeful companies
outperform the market by 42%Companies with a purpose statement
only perform at the mean oforganizations

Companies without a purpose statement
underperform by 42%© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

12

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Global Leadership Forecast 2018 | China Report• This effect is amplified in purposeful organizations,where engagement levels are 80 percent higher andemployees’ intent to stay is 34 percent higher.

Why Make Purpose Your Guide?
Of 1,500 global C-Suite executives surveyed, 84 percent
say their business operates in an increasingly disrupted
environment. In this world, purpose is a North Star—a
fixed point to help navigate through change anduncertainty.

• Culture. Companies with a purpose statement boast astronger culture of collectiveness than those without,and the effect is 31 percent greater in purposefulorganizations, which also report 31 percent greaterlevels of psychological safety. The culture is savvy but
not fearful; optimistic without being naïve. Radical
candor thrives, and people across the enterprise canrobustly tackle pressing issues.

To understand the impact of purpose, we identified three
types of organizations:• Those without a purpose.
• Those with a purpose statement.
• Purposeful organizations where leaders bring thestated purpose to life through behaviors.

• Agility. Having employee and stakeholder buy-inenables a purposeful organization to respond more
quickly and effectively when opportunities ariseor danger threatens (44 percent higher than nonpurposeful organizations).

We found clear evidence that companies in this third
category are earning a significant performance premium.

Why Isn’t Just Having a Purpose
Statement Enough?

• Resilience. Purposeful companies enjoy higher levelsof trust and loyalty, making them more resilient when
the going gets tough. They’re also better able to retain
customers, employees, and shareholders during theoften-painful transition periods that comprise the
new 21st century normal.

Companies with only a purpose statement realize
considerable performance improvements across many
outcome measures. However, we discovered that
purposeful organizations (those with active leadershipsupport) get even stronger financial performance in the
short and long term—and are better equipped to deal
with the fast-changing, competitive environment.

• Vision. Serving all stakeholders and aspiring to
improve society enables a broader vision—a bigger
game to play—making organizations more likely tospot unexpected opportunities and new risks.

More Benefits of Being a Purposeful
Organization• Learning environment. While many companies
understand that having a stated purpose is important,they struggle to weave it into day-to-day business. We
found that purposeful organizations build leaders’skills in inspiring, adapting, and team leadership.
They do this by focusing on experiences, coaching,and mentoring. Leaders learn from leaders, and theycoach and develop their people.

The advantages to being purposeful are many:• Engagement. Purpose is a key driver of employee
engagement. In previous research*, 96 percent ofleaders said that purpose is important to their job
satisfaction. In Global Leadership Forecast 2018, wefound that having a purpose statement not only has apositive effect on engagement overall, but 26 percent
more China leaders get meaning from work andenergy levels are 23 percent higher.

* EY Beacon Institute. (2017), How Can Purpose Reveal a Path
Through Disruption?, London.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Articulate a clear purpose for your organization.
Focus on answering the why questions. We allknow what our organizations do. Purpose isabout asking why we exist in the first place, what
our employees and stakeholders care about, andwhat resonates with customers.

• Integrate purpose into the company’s DNA.
Reinforce purpose through the day-to-day
customer and employee experience. Treat purpose
as a commitment to stakeholders and publicly
update on its progress.
• Focus on leaders. Help them develop their own“why.” Work with all leaders to articulate their own
purpose as it relates to the overarching purpose forthe business. Then, help them do the same for theirteams and employees.

• Use purpose as a lens for everything you do.
Let purpose guide the solutions you offer, how
you treat your customers, and how you engage
your workforce.
• Communicate success stories to all constituents.
Stories perpetuate purpose. Each time people
repeat them, purpose entwines more closely with
day-to-day business.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• Develop key skills. Purpose-driven leaders formteams, inspire, and motivate in a fast-changing
world. They develop psychological safety and agility.

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Digital-Era Leadership
Leaders Need to Release Future Talents’ Potential
The work world continues its metamorphosis as organizations increasingly leverage technology to modernize theirbusiness strategies. As the pace of change intensifies, many companies just cannot compete; 50 percent of the 2006
Fortune 500 companies no longer exist. Competition rains in from every direction. Looking ahead, technologies
such as robotics and artificial intelligence (AI) are projected to affect two billion jobs over the next decade.* These
trends represent both a threat and an opportunity. Organizations with digitally savvy leaders, the pioneers, areoutperforming those organizations with less digitally capable leaders, the laggards. As our work world becomesincreasingly digital, that performance gap will only grow.

How Digital-Ready Are Leaders?
Global Leadership Forecast 2018 shows digital-era leaders focus their attention across five clusters made up of 16
competencies (see figure below). Averaging across all competencies, only 17 percent of leaders in China consideredthemselves effective in all five areas.
The right column of the figure shows leaders’ ratings of their own effectiveness. They’ve reported relative strengths
in traditional leadership skills. However, the differentiators (digital capabilities and seeking out opportunities acrosscomplex ecosystems) are where leaders have gaps.

> Traditional Leadership Competencies vs. a New Set of Critical Knowledge, Skills, and Abilities

DigitalProgress

Key digital-era leadership capabilities

LeaderLeaderReadiness Readiness

Digital literacy

Drive digital by leveraging technology to modernize
their business strategy and operations.

Navigate a complex digital landscape by embracing
disruption with clarity of purpose and resilience.

Connect people and possibilities in an increasingly

dispersed and ecosystem-driven working world.

Relate to others on a very human level by balancing

Leading with digitization
Adaptability
Determination
Driving execution
Alignment
Connectivity
Hyper-collaboration

people and technology, and lead with true empathy
and inclusivity.

Inspiration

Think differently, focusing on holistic situational
understanding and seeking creative and innovative
possibilities.

Leading virtual teams

Integration
Cultural curiosity
Empathy
Identifying and developing future talent

Impact on
digital progress

Leadership
readiness

StrongWeak

360 thinking
Intellectual curiosity© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

14

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Global Leadership Forecast 2018 | China Report

Where Should You Focus?

and it will affect the speed of digital transformation andinnovation.

Not every competency has the same impact on anorganization’s digital performance. The middle columnof the figure at left shows the six competencies that havethe greatest impact on performance. Of these six mostcritical skills, leaders are relatively strong in four areas,
weaker in two.

• A 360 view. Leaders must be able to spot patterns and bring
thinking together from multiple perspectives, in order tofind opportunities for further development and innovation.
This is a real weakness.

What Does This Mean for Performanceand Potential?

• Lead with digitization. Organizations need leaders
who understand the impact digital tech can have on theirbusinesses. They sense what is and isn’t possible and, more
important, sense what will be possible. Some scenarios
where new technologies can be applied: generating
business intelligence with big data; transforming andautomating business and operations to increase efficiency;
or discovering new business models and opportunities tocreate competitive advantage for the company. Such ability
is a relatively weak point for Chinese leaders.

We found that the pioneers, digitally savvy leaders, aremore prepared than the laggards to meet emerging
business challenges. Most notably, they’re betterat anticipating and responding to the competitiveenvironment, navigating through complexity, and using
data and analytics to guide their decision making.
The digital leadership performance premiumThose organizations with the strongest digital leadership capabilities (the pioneers)
are outperforming those with the weakest capabilities (the laggards)
Financial performance (compound
financial measure of growth and EBIT)• Adaptability is a must. Digital leaders must be able toadapt to constant change or fall behind. They need to belearning every day, not getting caught up in “traditions.”
This is a relative leadership strength.
• Execution. It’s one thing to anticipate change. But it takes
another set of skills altogether to turn new ideas into reality.
There is also a need of good planning and supporting
practices on how to drive the initiatives. It is a weakness
for Chinese leaders, because it is not necessary for leaders
to exercise this ability in the past economic environment
where rapid development took place through natural
growth. However, those days are past time, now companies
transform and enhance atop certain bases. It is a must do
for corporate leaders to get initiatives implemented.

50%
Digital pioneers (top 25%of respondents) outperform
others by 50%

Average-28% Digital laggards (bottom 50% of respondents)
underperform others by -28%

© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

• Hyper-collaboration is about working relentlessly to break
down silos. It’s getting people working together to solve
customers’ and the organization’s issues. Although Chinese
leaders are adept in this field, they still need to achieve
co-integration. It is key to create business value throughcollaboration in this digital era where the boundaries
between organizations are blurring with competition andemployment realized in an increasingly diverse way.

In the figure above, we also demonstrated a significant
relationship between leaders’ digital readiness and theirorganization’s financial performance. Looking to thenear future, every organization will need to embrace newtechnologies if they are to flourish. And, those with themost capable digital-ready leaders will continue to stayahead of the curve. In another section titled “Accelerating
the Digital Journey,” we focus on how to ramp up
organizational and leadership digital capability.

• Identify and develop new talent. Leaders need to spot
and rapidly bring on board the digitally savvy talent of
tomorrow. To fully empower and unlock their potential
is hard. Chinese leaders are relatively weak in this area,* Frey, T. (2012, February), 2 Billion Jobs to Disappear by 2030,
http://www.futuristspeaker.com/business-trends/2-billion-jobs-todisappear-by-2030/

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Start by identifying critical leadership roles andassess readiness of your talent to embrace andpioneer digital transformation.

• Some of your current leadership bench will be
unable to acquire a new mindset. They may need
to be replaced with more digitally capable leaders.

• Rethink your competency framework to include
emergent knowledge and skills to focus leader
development. Many companies going throughunprecedented change have not reexamined theircompetency models.

• Lead for the future of the organization. Nurtureand develop leaders as much as those running thelegacy business. New leaders will not only requirea technical mindset, but also the imaginationand vision of how technology can enable theirorganization’s competitive position.

• Develop digital accelerator leadership-immersion
programs. This is an excellent approach to building
both technical know-how and leadership capability.
• Move beyond simply “doing digital” via discrete
technology implementations to “being digital,” anembedded leadership mindset and way of working.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

15• Foster a digital ecosystem for leaders to thrive.
This includes new approaches to learning,
rewards, use of space, and elimination ofhierarchies. Place great digitally ready leaders in a
traditional culture, and they will surely fail.
www.ddichina.cn/glf2018

Accelerating theDigital Journey

Changing Old Leadership Mindsets andWays of Working
In our section, “Digital-Era Leadership,” we put forth a new model of leadership and demonstrated that leaders who
are more digitally capable exert a positive impact on their organization’s performance. We also showed that this newera digital leadership requires a full and complex range of skills, including interpersonal, analytic, and technical. To
thrive in this new era, most organizations will need to build new skills and capabilities; they’ll also need to overcome
old mindsets and ways of working. This won’t be achieved by the delivery of formal training and learning alone. The
workplace must become the learning environment. To assure this transition, everyone in the organization will need tobe learning every day.

How Do Organizations Accelerate Their Digital Journey?
We explored dozens of organizational operating environments that elevate the bar from simply “doing digital” to truly“being digital.” Three emerge as critical:•New learning cultures. Building digital-era leadership capability requires a workplace where everyone learns
every day. There’s a heavy emphasis on experiential development. Highly capable digital-ready leaders, thepioneers, actively manage their own growth and development. Compared to their peers who aren’t as skilled,> Meeting New Workplace Challenges

Digital Pioneers’ Impact Compared to Digital Laggards’

4.9x

5.1x

Acting decisively

5.1x

4.9x

Anticipating and reacting to change

4.1x

5.0x

Maintaining effectiveness

4.8x

5.7x

Navigating through complexity

5.6x

7.9x

Operating in a digital environment

4.6x

6.5x

Using data to guide decisions

High digitally ready leadersjudge themselves...
...better equipped than digital
laggards to cope with newworkplace challenges© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

16

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Global Leadership Forecast 2018 | China Report

digitally-ready leaders in China are more likely (93versus 82 percent) to take on stretch assignments tobuild new skills. They’re also more likely to provide
input to grow the business (61 versus 41 percent) andseek it from others to grow themselves (93 versus 80
percent).

become nimbler, data-driven, tech-savvy, and tied tothe evolving business needs.
Yet, HR is one of the least effective functions. Only
16 percent of HR professionals report being very
prepared to operate in a digital environment. This isquite ironic: How can digitally challenged HR leaderstake the point on modernizing the way talent willneed to be developed, engaged, and deployed in the
future?

Getting the culture right delivers more able, confident
leaders. The figure at left shows the differencesin leaders’ confidence to face these challenges.
Pioneers (digitally adept leaders) are significantly
more confident than the digital laggards in handlingevery challenge. They are 7.9 times more confident
operating in a digital environment, and 4.9 times
more likely to anticipate and react to change.

Analysis of the global data reveals a considerable payoff
for accelerated digital transformation. The figure above
examines five elements essential to operating in a
Impact for Organizations in a High State of
Digital Maturity

Compared with global leaders, Chinese leaders are
more proactive in managing their own learning anddevelopment. In China, even leaders with relatively
low digital maturity are more likely to accept
provocative tasks or learn from others than global
leaders with low digital maturity. Chinese leaders withhigh digital maturity are much more confident in theirability to operate efficiently in the digital environment
than the leaders with high digital maturity around theworld (7.9 vs 5.6). These data suggest Chinese leaders
are more digitally mature than leaders over the world.

Strongexperimental
mindset14x

Strong6.8x Agile

10.5x culture

4.5x Future focus• New working environment. Today’s highperforming operating environments are purposedriven and team-based, with shallower hierarchies.
They enable workforce mobility and deliver a
consumer-grade technology experience to internal
workers, aligning modern performance and rewards
practices to theright behaviors.

2.2x

Data driven© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

Developing the right environment drives engagement,
productivity, and learning. Digital-ready leadersin China are more likely to respond that they are“definitely engaged” at work (71 versus 39 percent).
They’re also more likely to see their organization as
embracing or even rewarding failure in pursuit ofinnovation (63 versus 31 percent). Additionally, 80
percent of digital-ready leaders feel a strong senseof accountability for effectively leading their people,
compared to only 50 percent for leaders who are notready.

highly digital workplace. Digitally mature organizations(those farther along in their digital transformation)
have stronger overall cultures than their less-mature
counterparts—by a factor of 10.5. As we mentioned
above, they’re more likely to encourage and reward
experimentation and far more focused on future
possibilities, not past constraints. And, they’re nearlyseven times more likely to lead with agility. Finally, datadriven decisions are used more heavily.

• New role of HR. Building digital organizations
requires a reset of talent and leadershipinfrastructures. The HR function must transform to

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Examine every aspect of your talentmanagement system. Make sure it’s building
capable, future-ready digital leaders.

• Measure and work on your organization’s learning
culture.
• Take an integrated approach to building a future
workplace. Use rewards, workforce mobility, andtechnology experiences and leverage physicalspace and structure to drive collaboration andinnovation.

• Ensure that you’re reinforcing a culture where
people continuously grow and learn. The
workplace, not the classroom, has become theprimary learning environment.
• Invest resources to build HR leaders’ skills
in using digital technologies and predictive
analytics. As they become more adept, they’llembrace the new way of working.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• Stop talking and start transforming. You need tostand shoulder-to-shoulder, starting with HR as
custodians of your organization’s assets.

17

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Leading with Data-Driven
Decisions
The Culture and Skills Driving
Higher Returns on Data

Nearly seven years after the first “Big Data” articles appeared in major business publications, many organizations
struggle to counter Big Data’s substantial costs with newly unlocked value. A 2017 study* found that fewer than half ofsenior Fortune 1000 decision makers see measurable returns from Big Data. In Global Leadership Forecast 2018, acrossthe global sample of data, companies whose leaders are well prepared to use data to guide decisions are 8.7 times more
likely to have closely integrated talent and business strategies, 7.4 times more likely to have a strong bench of future
leaders, and 2.1 times more likely to have grown aggressively over the past three years, compared to organizations
whose leaders are ill-prepared for a data-rich business context. But these are the outcomes, not the drivers. What is
the leadership context—the culture and skills—that makes these returns not only possible, but probable?

>T he Cultural Factors that Make Data-Savvy Organizations UniqueStrength of CulturehHig

IQ over EQ

Experimentation
MindsetLow

Engagement
over Execution

Digital Tech
Influence

Influence-based
Leader Power

Focus onFuture Vision
Organizational Agility

cultural profile for organizations
with data-savvy leaderscultural profile for organizations thatstruggle to make data-driven decisions© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

18

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Global Leadership Forecast 2018 | China Report

Traits of a Data-Driven Enterprise

Skills Linked to Data-Savvy Leadership

We identified the five cultural factors (shown in thegraphic at left) in which data-savvy organizations mostexceed organizations where leaders struggle with data:

2. Experimentation mindset. Data provides theconfidence to launch and gauge the success ofexperiments and to objectively learn from failures.
3. Digital technology influence. Technology is aprime source for new volumes and varieties of data;
digital advancement parallels being data-savvy.
4. Focus on future vision. Data informs trajectories
and trends via prescriptive and predictive analytics.

Leading with digitization

56%

Integration

59%

Percent of Eﬀective Leaders

1. Strength of company culture. Data-savvy
companies build the shared mental models vital for
cultural strength by actively measuring and reacting
to customer and employee viewpoints.

39%
38%
48%
71%
56%
61%
58%
63%
48%
52%
64%
65%
62%
66%

5. Organizational agility. Agile organizations are
fueled by rapid data acquisition and action.

Driving execution
Leading virtual teams
Digital literacy
Determination
IDing/Developing talent
Adaptability
Intellectual curiosity
Inspiration
360° thinking
Cultural curiosity
Alignment
Hyper-collaboration
Connectivity
Empathy© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

Yet, the need to be data-driven isn’t limited to aparticular style of leadership: whether EQ or IQ is more
important, whether leaders have an execution or an
engagement focus, or whether leaders derive power frompersonal versus position-based influence.

information from multiple sources). This confirmation of
the importance of managerial capabilities parallels 2017
research from MIT Sloan**.
Notably, the bottom-three skills—empathy, connectivity,and collaboration—aren’t recognized enough for the role
they can play in using data not just adeptly, but fairly
and in partnership with others. A tighter connection ofinterpersonal skills to data-driven decisions may be apath for organizations to improve their low success rates
extracting value from big data.

The Skills of Data-Savvy Leaders
In addition to rating their preparedness to use data inmaking decisions, leaders also rated their confidence in
16 skills. The figure at right orders skills based on theirlink with data-savvy (a longer bar equals a stronger link).
The statistics presented to the left of each skill represent
the percentage of effective leaders in China.

* Bean, R. (2017), How Companies Say They’re Using Big Data,
Harvard Business Review.

Not surprisingly, leading with digitization (using
technology to manage the workforce) heads the list.
Also in the top five are leading virtual teams and digital
literacy (personal technology expertise). To underscorethe fact that being data-savvy isn’t only about being
digital, two management skills also made the top
five: driving execution and integration (combining** Bughin, J., & Hazan, E. (2017), Five management strategies forgetting the most from AI, MIT Sloan Management Review.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Use data to create a common culture. Strong
cultures aren’t formed by accident; they’re fosteredcarefully and monitored by aggressively using data
to understand how employees and customers viewthe company and then reacting accordingly.

• Don’t overlook empathy, connectivity, andcollaboration. Few leaders see the connection
between interpersonal skills and ability to use data
effectively for business decisions. This is a prime
opportunity to strengthen awareness of these links
and to factor in the human implications of data.

• Build digital skills. Digital acumen at both apersonal level (understanding new technologies
oneself) and a leadership level (using
technologies to lead others in different, moreeffective ways) is key for successful data-driven
decisions.

• Implement Agile project management techniques.
Agile methodologies provide the cadence, mindset,
and opportunity to flow high volumes, varieties, andvelocities of data into actionable use.
• Prepare for AI. Efficient and ethical artificial
intelligence applications, already in the strategicplans for many organizations, will require a
critical mass of leaders whose skills span digital,
management, and interpersonal domains.

• But don’t neglect the execution element.
Leaders who excel at using data effectively also
integrate it from multiple sources and know
how to convert the data’s strategic insights into
operational plans.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

19

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Why Technology Leaders
Are Failing
The High Cost of Low-Chance Development

Technology companies are known for being leading-edge and driving innovative ways to meet customer demands.
This venture can overtake—and overshadow—their focus on growing internal customers. As a result, technology
organizations face unique leadership challenges, including lower engagement and retention, fueled by an acceleratingcompetition for talent. Among the more than 2,400 organizations participating in Global Leadership Forecast 2018,tech companies reported the lowest success rates for their leaders (61 percent). This means that about two of every
five technology leadership assignments are considered failures, a rate that is 20 percent higher than that of otherindustries. What’s causing such a high failure rate? According to data gathered from 1,086 technology leaders and107 HR professionals, tech companies are falling behind in four key development practices that not only drive higher
success rates, but also affect other leader outcomes, including higher engagement and retention.

> How Technology Industry Leadership Is Falling Behind Other Industries

Percentage thathave a strong future
leadership supply

Average annual
leader turnover

12%

15%
Success rate forfilling leadership
positions internally

61%
Percentage oftechnology
companies that rateoverall leadership
quality as high

23%

33%

Percentage oftechnology leaderswith a development
plan

Outcomes where technology is notably worse than other industries© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

20

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Global Leadership Forecast 2018 | China Reportdiscussions. For those who did meet, the discussions
focused more on current performance than development.
In fact, tech leaders spent the least time talking about
personal development in their performance discussions
overall—on average, 23 percent less than leaders inother industries.

Four Practices that Leave
Technology Behind
1. Unclear Career Management
Only 64 percent of leaders in technology said they
understand their career path within their organization—
14 percent fewer than those in other industries. This isa critical area for improvement, given that establishingclear career paths not only boosts leaders’ successrates, but also consistently drives their engagement andretention. In technology organizations the potential
upside is great, as tech leaders show 17 percent lower
engagement and are twice as likely to turn over as leadersin other industries.

According to technology HR professionals, they also
are more likely to have eliminated performance ratings.
Nearly twice as many technology companies than otherindustries (31 versus 17 percent) reported that they’ve
stopped using performance management ratings. Thismight be leading them to abandon valuable development
discussions altogether, to the detriment of overall quality.
Tech leaders rated their performance management
programs significantly lower than other industries, with
only 27 percent of leaders identifying their performance
management program as high quality. That figure
contrasts to 36 percent of leaders in other industries.

2. No Plan for Development
In addition to lacking a clear career path, only one-thirdof tech leaders surveyed have an up-to-date development
plan—32 percent fewer than other industries. Having
a current plan in place guides leaders to track andmeasure their development progress. It also makes
them accountable for their own development. Without
this guidance and accountability, development is left tochance.

Lower Investment, Higher Risk
In addition to lagging in these four practices, technology
organizations are investing far less time and money onleadership development. On average, the companies
spend 15 percent less on first-level leadershipdevelopment than organizations in other industries.
Spending is more equal for senior-level and highpotential leadership development, though it still runs 6
percent behind other industries. Even more critical than
the gap in dollars spent is the shortage of hours invested
in developing leaders. On average, technology leaders
spend only 25 hours in structured development eachyear, 10 percent less than leaders inother industries.

3. Development Is Too DIY
In tech organizations, leadership development is more
DIY and out of alignment with what leaders want inother industries. The three types of learning sought mostby technology leaders—external coaching (74 percent),
formal development (60 percent), and short-term
developmental assignments (50 percent)—are provided
least often by their companies in comparison to thosein other industries. Instead, tech companies reported
a higher reliance on internal coaching and self-study,
which only 34 percent of leaders said they wanted.

4. Development Is Out of Discussion
Thirty-two percent more tech leaders reported that they
never meet with their manager to have performance

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Step up your focus on development. Communicate
more frequently about it and seek feedback on
your efforts. Once leaders start thinking and talking
about it, the frequency of development discussions
will increase.

• Invest in more blended learning. Establish an
online library that supports what leaders arelearning via more traditional, structured coachingand development initiatives. Providing a mix ofmethods enables a broader basis of development.
Leverage, but don’t limit leaders to, on-demand
external learning content.

• Diagnose individual and group development
needs. Assess leaders to identify their development
needs, then center plans on improving in thoseareas. Leverage aggregate data to determine thegreatest group gaps that can inform future leader
selection and promotion.
• Redefine the business of development plans. Given
that development targets are business goals, holdleaders accountable for meeting them. Requireleaders to complete and act on their development.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

21• Drive retention with clearer paths to advancement.
Ensure that leaders have a clear understanding of
how they’ll grow to increase their development
focus and retention. Leaders who aren’t sure about
their advancement path will be more likely to seek
career growth elsewhere.

www.ddichina.cn/glf2018

Rethinking Leadership
Potential

10 Ways to Elevate High-Potential Leaders
Identifying and preparing future leaders is a quintessential “top of the house” issue. Our research drew on responses
from nearly 1,000 senior-level leaders across the globe to identify the issues demanding their greatest attention forthe coming year. Their top two concerns are deeply integrated with proactive talent strategy and high-potential
management: developing “Next Gen” leaders and failure to attract/retain top talent. To provide context, senior leaderschose these issues more than twice as often as slowing economic growth in emerging markets, labor relations, andglobal recession. This intense focus also cascades into cost and time investments: On average, companies worldwide
spend $4,000 and 39 hours per high-potential leader, per year for development activities. For organizations with1,000 high-potential leaders, this translates to an annual investment of more than $4 million and 4,800 person-days.
In China, companies spend an average of $3,604 and 37 hours per high-potential leader – translating into an annual
investment of $3,604,000 and 4,625 person-days or every 1,000 high-potential leaders. Clearly, the stakes are high for adata-driven evaluation of high-potential programs’ effectiveness.

Mixed Results on Potential’s Progress

Top

10

Pra
ctic
Fai
es
r/
pro Objec
ces tive
ses
tale
nt r
evie
Unb
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It’s important to start by recognizing the signs of positive movement for high-potential programs between 2014 andnow: In China high-potential success rates are up from 48 to 59 percent, and high-potential programs are more genderdiverse, a boost from 13 to 19 percent women. The next layer of data, however, reveals problem signs for potential
efforts. Despite 69 percent of organizations having high-potential programs, 59 percent rated them as less than highly

High-Potential
Leader Success
Rate WhenIn Place

71% 70% 69% 70% 69% 69% 70% 70% 70% 69%
13%High-Potential
Leader Success
Rate When

Absent> Top 10
Practicesfor Boosting
High-Potential
Leader Success
Rates

11%

10%

10%

9%

9%

9%

8%

7%

7%

61% 62% 63% 62%
58% 59% 59% 60% 60% 60%= practice that applies across the organization= practice that is specific to high-potentials© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

Globally, organizations that opt to extend theirdevelopment of high-potential talent below senior levels
are 4.2 times more likely to outperform those that don’t
on a financial composite of revenue growth, operating
margin, EBITDA, and return on equity.

effective. Outcome links are also unraveling: Globally,
relationships between high-potential programs andleadership outcomes are 19 percent weaker now than in2015.
And perhaps most alarming, looking at the mostimportant reason these programs exist—to address CEOs’
top concern by building a strong pipeline of future-readyleaders—progress is nonexistent at best and retreating
at worst. Currently only 6 percent of organizations in
China feel they have a strong bench (down slightly from
10 percent in 2015), and only 38 percent of critical roles
can be filled rapidly by internal candidates (down from 50
percent).

Can Bigger Pools Drive Better Outcomes?

The conventional wisdom that high-potential efforts
need to be restricted to an exclusive few simply isn’t
supported by the research. China companies designate
30 percent of their leaders as high potential, up from18 percent in 2014, and larger pools tend to be more
effective. Yet, just stocking the pool with more leaders
isn’t the key to success. Use of analytics, peer and mentordriven coaching, long-term developmental assignments,
and personalized learning propel organizations tooutperform companies with a narrowly constrained viewof potential. Larger pool sizes alone aren’t the answer;
rather, a full reshaping of a company’s orientation towardpotential is required.

Chinese companies have higher confidence in theeffectiveness of their high-potential talent development
programs. Yet the actual leadership bench strength islower than the global level. How is this happening?
One possible reason is that, of course, Chinese leaders
overestimated the effectiveness of high-potential
talent programs, but another believable reason is thatthe turnover rate of high-potential talents is higher
than anywhere else, since the Chinese companies aredemanding when the business environment grow at such
alarming rate. Therefore, the problem of short supply
still exists even if there are high-quality high-potential
programs. This also means that Chinese companies mustfind more efficient ways to train high-potential talents.

Best Practices Aren’t Just About the Pool

Turning to the practices themselves, the graphic at left
shows the top 10 practices linked to higher success rates
for high potentials around the world. Most companies
don’t use them all; in fact, just 18 percent of companies,
worldwide, use all, and over a third use half or fewer. Notethat not even half of the practices driving success are
specific to high potentials. Instead, they deal with core
themes of development, diagnosis, and objectivity for all,representing an inclusive, systematic view of potential.

The Perils of a Top-Down, Top-Only View
To gauge why few organizations succeed in cultivating
potential, we looked at one of the first decisions madewhen creating a high-potential program: how deeply toextend it. Nearly half of China organizations (51 percent)limit their potential focus to senior-most levels. Even
more troubling, this percentage has barely changed from2014 (30 percent) and reflects a costly misstep.

Driving Returns on Potential Investments
As noted earlier, high-potential programs and individuals
require outsized investments. When pairing thesefinancial figures with an average success rate of 59
percent for high-potential leaders in China, it translates
to wasted expense (for the 41 percent not successful) of
about $1,477,640 and 1,896 person-days. By employing
proven practices, organizations can dramatically boost
return on their investment in potential.

It shows that the Chinese companies under high-speed
development are extremely in need of competent seniorleaders, thus they invest their attention in the highpotential talent pool of executives, it is a rational method,
but not the most sufficient.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Investing time is more essential than investingmoney: the effectiveness of time invested in highpotential talent development programs to improve
the leadership and business outcomes (including
financial performance) is 68% better than that ofmoney invested to do so.
• Target diversity, not just numbers. When companies
expand their view of potential, they increase gender
diversity for leaders at all levels, including different
talents, posts, professions and countries.
• The larger the talent pool becomes, the moreobjective data support is needed: The larger thetalent pool becomes, the more objective data isneeded to help you understand the full picture of thetalents. Based on these make appropriate development
and appointment decisions to avoid biases that stifle
the potential of talents. In this way, it will become more
inclusive.
• Create a culture of coaching. Companies with more
successful pools use peer coaching and external
mentors heavily.
• Use scalable tools for deeper diagnosis. It’s rarethat the same tools used with a senior leader-onlyview will be appropriate for a full-pipeline talentreview; introduce new tools accordingly.

• Hours over money. Hours spent on high-potential
development has a 68 percent stronger relationshipto leadership and business outcomes than money
spent, including a significant link to the financial
composite that doesn’t exist for money spent.
• Prioritize immersive, personalized learning.
Formal learning that incorporates personalization
to the high-potential learner and well-planneddevelopmental assignments increases success rates.
• Strengthen your analytics backbone. Highpotential success rates rise with benchmarking,forecasting, results metrics, and data visualizationin place.
• Track return on the potential investment. Highimpact practices can yield high returns, but only
when integratedv, sustained, and monitored. Highpotential programs can achieve high returns, but
only if you can begin with the end in mind to plan
the overall talent strategy, . Continually making
adjustment and correction along tracking theeffectiveness is necessary.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Meeting the Needs of theModern LearnerTechnology Gains Its Footing,but It’s a Slippery Slope

The scope and variety of learning methods continue a rapid advance at a pace. With the Chinese government’s emphasison education, the K12 educational approach has become quite diverse to match the needs of the new generation ofdigital natives. In 2016, China invested 15.5 billion yuan in the education market. By 2018, there will be an investment of
28.3 billion yuan. The market for online education alone is as high as 200 billion in 2018, and the size of users reached
to 160 million. These facts have fully accelerated the transformation of all training and educational institutions. The
application of technologies such as flipping, AI, VR has been realized in many educational institutions.
In the workplace it’s daunting to respond to these pressures and decide among the vast range of learning methods andapproaches. Leadership development is not as simple as vocational skills education, so a variety of different learning
methods are required to inspire, inform, and enable the application and behavior change. But as digital natives entering
the office, it is key for HR managers to design the learning experience in the future by figuring out how to properly
integrate technology-centric learning methods with traditional highly tangible learning methods (formal training andcoaching) and how to apply what they had learnt to work areas. Although organizations want to meet the needs of all
modern learners, the choices and tradeoffs are complex and becoming even more so. In this research, we took stockof the leadership learning landscape, factoring in company usage and leader preferences to recommend an evidencebased path forward for learning design.

Leaders Want Morethan They’reGetting
Personalized

Coaching fromexternal mentors

Internallydeveloped

Game-basedhtig

Externally developed

Books/Articles
Microlearning
Social
Self-study
network-based

R
ut

bo

Long-term
developmental
assignments

Coaching frommy manager
Formal workshops,
training courses,seminars
Short-term developmental
assignments

On-demand

Mobiledevice-basedA

More Sought-After by Leaders> How Much Leaders Want—and Are Getting—19 Learning Methods for Developing China Leaders

Computer-based

Coachingfrom peers
PodcastCoaching from employees
Leaders Get Morethan They’re Wanting
Heavier Use by Organizations© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Reportapproaches are roughly in line for what leaders want andwhat their companies are offering. feedabck/coachingfrom employees, game learning, podcast learning andcoaching from peers are methods that Chinese leaders
rarely experience. They may not be able to judge thevalue. However, “game learning” is expected to simulate
the scene of reality in the short term with the current
technology, so that students can have an immersive
learning experience even when they can take over no realtask. “Peer Coaching” also holds latent value.. The digitalage requires wide variety of abilities. It will be a trend
to learn different skills from different people. Finally,learning comes from self-awareness, and feedback from
subordinates can serve as the beginning of self-awareness.
As a link of the development program, feedback inspires
initiation.

Meeting Modern Learners’ Needs
To understand where learning needs to go, we started
with the needs of learners themselves. We saw highconsistency across generations. The three features Chinalearners prefer most include (in this order):1. Personalized learning experiences.
2. Coaching from external mentors.
3. Coaching from my current manage
Chinese leaders’ top two choices for development are thesame as the world choices according to the global data,
but their third choice is formal classroom learning andtraining courses. It reflects the fact that Chinese leaders
are more eager to practice in learning.
While this is what learners want, what they actually get
can be far different. In the graphic at left, we juxtaposed
learner preferences with company use for 19 learning
types and methods, to yield three categories:

Technology Alone Isn’t Enough…
Despite its immense attention and expense, our datashows that technology isn’t having a notable impact
on leadership or business outcomes above and beyond
coaching (from managers, peers, external mentors, andemployees). Nor is it surpassing high-touch methods
such as formal learning and development assignments.

Leaders Want More than They’re Getting (5 types)—
This category includes coaching from external mentors,
long-term developmental assignments, personalized, ondemand, and mobile device-based. It spotlights leaders’thirst for external perspectives on their challenges—
many of which aren’t unique to their own company—
as well as immersive development and personalized“anytime, anywhere” learning.
Leaders Get More than They’re Wanting (5)—
Methods include formal workshops/training courses/
seminars,books/articles, self-study,short-term
developmental assignments,and computer-basedlearning. It is worth mentioning that the training mostly
provided by HR offers a little more than what the leaders
asked. This means that the leaders accept this learning
style, but they also desire others learning approaches
such as flipping learning outside the classroom. Leaders
also have reservations about “on-the-job learning”
morphing into “on-your-own” learning through selfstudy and books/articles. It is recommended to apply
these elements as a small part of the learning method,
but with less proportion.

…But Adds Value When It’s Need-Matched

Technology’s role becomes clearer, however, when viewed
as an accelerator of learning impact. Globally, the link
between learning programs and leader quality is 46
percent stronger when technology is used heavily. It also
improves back-to-the-job application, raising it from 55
percent with minimal technology use to 63 percent withextensive use.
In future development programs, technology willserve more purposes than technology itself. When thedesigned technology meets the needs, it can create value
for on-demand learning, personalized learning, mobile
terminal learning and the learning to connect leaderswith external mentors. The findings in this chapter also
tell us that Chinese leaders are expecting more on-timeand on-demand personalized learning, as well as moremobile learning. The biggest role of technology is toenable students to learn all the time.

About Right (9)—coaching from the current
manager, internally developed learning, externallydeveloped,microlearning,social network-based,gamebased,Coaching from peer leaders, coaching leaders
receive from their employees, and podcast.These learning

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Shift away from self-service. Technology driven or not,learners want much less self-study learning. Allow learners
to study what they need rather than forcing them to do
assignments. Tailor personalized development plan rather
than giving out unspecific general plans.
• Improve the value of manager coaching. Chinese
leaders welcome the mentoring from direct leadership,
but in order to maximize the value of their coaching
to subordinates, companies needs to strengthen thecoaching skills of these superior leaders.
• Experiment with game-based learning. Though few
companies are putting this approach in place, they are
liked by Millennial leaders among all generations. The
concept can be achieved not only through technology.
Offline classroom activities should also give it a try toincrease learning motivation and experience.
• Understand the learning problems technology willsolve. Don’t invest further in learning technology until
you’re certain you understand the problems it willsolve and needs it will meet. This is the key to stronger
technology impact and ROI.

• Pursue learning personalization. This was by
far the dominant feature defining what leaders
want most. Technology’s potential here isimmense to bring personalization to largescale learning. This includes new techniquessuch as machine learning and natural language
processing to rapidly distill information into
personalized recommendations.
• Extend learning beyond the classroom.
Learning reinforced through prompts andpractice—often, but not only, throughtechnology tools—better “sticks” once theleader is back on the job.
• Appoint a Learning Experience Manager. Only
37 percent of companies have this role in place,but those that do are 5.5 times more likely tohave highly effective leadership development
systems.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Making the Most ofHigh-Potential Talent
Avoiding a Mismatch Between
What They Want and Get

Globally, 0rganizations spend more money developing high potentials than any other group of leaders, including
the senior team. High-potential leaders also spend more hours per year in formal leadership training than any otherleadership group. In China, companies annually spend an average of $3,604 and 37 hoursper high-potential leader.
Given the money and time expended, how can organizations ensure that they’re reaping benefits of cultivating thesewould-be high performers?
Knowing what high-potential leaders want from their development experiences can shape a company’s strategy
and lead to positive outcomes. High-potential respondents to our survey were clear: They’re looking for tailoreddevelopment. From a list of 10 development types (see figure below), four of their top five preferences are types oflearning that are tailored to their own needs. Coaching from external mentors tops the list, and short-term andlong-term development assignments and coaching from current managers are also in the top five. High-potential
leaders also desire formal workshops and training courses, the type of learning that’s provided most frequently byorganizations.

Identifying High Potentials

Many organizations are caught in the same dilemma: how to identify high potentials, how to develop them as leaders,
and when to promote them. The benefits to having them are obvious, but how can organizations maximize theircontribution and keep them engaged?
> Mismatch Between Leadership Development Learning and What High-Potential Leaders Desire in China

Rankings of Leadership Development Types
PROVIDED BY ORGANIZATIONSDESIRED BY HIGH-POTENTIAL LEADERS

Formal workshops, training courses, seminars

1

1

Coaching from external mentors

Coaching from current manager

2

2

Coaching from current manager

Short-term developmental assignments33Formal workshops, training courses, seminars

Books/Articles

44

Short-term developmental assignments

Coaching from external mentors

55Long-term developmental assignments

Microlearning

6

6

Books/Articles

Long-term developmental assignments

77

Microlearning

Coaching from peers

88Game-based learning

Game-based learning

99

Coaching from peers

Coaching from employees 10

10 Coaching from employees© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

Simply identifying high potentials within theorganization is correlated with positive business results.
Companies that know who their high potentials arehave greater bench strength, and leaders who havebeen notified of their high-potential status are moreengaged and more likely to commit energy to growth anddevelopment opportunities. In China, turnover is also
lower among high potentials (10 percent per year) than
the general leadership population (12 percent).

number 6. Organizations can provide more targetedlearning opportunities for high potentials by increasingcoaching and developmental assignments for them.
The previous chapter talked about the common talentdevelopment methods. The Chinese leaders rank books
as the 11th method to develop. Compared with the leaders
at home and abroad, China’s high-potential leaders
are more able to accept abstract learning that requires
reading and thinking, which is a good phenomenon.
Enterprises need to provide more personalized andtargeted learning opportunities for high-potential
leaders by increasing internal and external counselingand appointing them with long-term and short-term
development tasks.

Many organizations are seeing this benefit. About
69 percent of Chinacompanies we surveyed identify
high potentials, and of those organizations, almost
62 percent inform them of their special status. While
HR professionals mostly agree that their identification
methods are unbiased (81 percent), higher than global(73%). Comparing on the worldwide scale, Chinesecompanies are not doing as well in the consistency ofthe process for selecting high-potential talents. This also
leads to the question that what kind of potential traits
are necessary to access when selecting high-potential
talents? What resulted in the inconsistency? The biggest
impact is that: are the high-potential leaders chosen by
us really fit the needs of the future?

Among several key activities to identify and manage
high potential, most HR professionals agree that theirorganization evaluates high-potential performance, but
measuring effectiveness of programming is a weakness(see figure above).
GlobalChina

High-potential leaders’ performance indevelopmental assignments is carefully evaluated.

Are High Potentials Getting the Learning
They Want Most?

77%
85%

In some cases, high potentials get the desired learning,
but not often enough. In China long-term developmental
assignments rank as the number 5 most-desired learning
method, and 57 percent of them have completed at least
one international assignment. About half (50 percent)have had a formal mentor. That said, 50 percent ofleaders not identified as high potential also have had aformal mentor, and 43 percent of those individuals havecompleted an international assignment.

Our process for identifying high potentials isunbiased and nonpolitical.

73%
81%
Managers are held accountable for supporting
high-potential leaders.

69%
86%
The process for identifying high potentials is
consistent across the organization.

Considering this small difference, it shows that we havemade a significant difference between the developmentof high-potential leaders and the routine development.
though coaching from external mentors ranks number
1 on list of desired developmental experiences for highpotentials, it ranks number 5 in terms of what companies
actually provide. Using books and articles is a commonly
provided developmental activity, but it ranks low on
the list of the types of learning high potentials want at

66%
63%
We measure the effectiveness of programs fordeveloping high-potential leaders.

55%
63%© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Consistently identify high potentials. You
can do this via clear evaluation criteria aroundcompetencies and expectations.

• Give high potentials the tailored learning
experiences they crave. After an objective
assessment of the potential power of high potential
talents, the assessment data are used to design apersonalized learning program. This means externalcoaching, short-term and special projects, orrotational-placement programs. Some experiences
can be provided at low cost.
• Provide simulations of major events or decisions.
These experiences allow leaders to practice reacting torealistic scenarios. Networking events to expose highpotentials to senior leaders and mentoring programs
can have significant impact as well. Designing theseexperiences may require greater creativity andthoughtfulness than typical development programs,
but they can lead to greater returns.

• Evaluate high potentials’ success. Measure thesuccess of high-potential talent programs fromseveral dimensions: whether the development
activities are consistent with high-potential
talent expectations, the performance of highpotential talents in developmental tasks andwork achievements. Measure the effectivenessof high-latent talent development programs forenterprises.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Performance Management
Are Ratings Overrated for Growing Leaders?
Several years into the “performance management revolution,”* debate continues on how best to approach the core,
yet deceptively nuanced, managerial activity of holding performance discussions with employees. Many organizations
have overhauled (in some cases, multiple times) their approaches to these conversations, oscillating across a matrix
of how often (frequency of performance management meetings and revisions) and how development-centric(proportion of discussion time devoted to personal development versus administrative oversight). How to replace
KPI with OKR? While a trend is gradually taking shape toward performance management that is more frequent, lessformal, and centered around future growth, research is limited about which approaches work best. Our research
addresses these topics with a global sample pairing organizational practices with leaders who are both engaging andparticipating in (with their own managers) performance management discussions.

Top Three Performance Management Practices
We started with a foundational question: What practices produce better performance management? Those that tend
to drive effectiveness:> Advantages of Development-Focused Performance Management

25%

Percentage ofmeeting timespent ondevelopment-focused
discussion

Weaker Outcomes
+
++
+

75%

Percentage ofmeeting timespent ondevelopment-focused
discussion

Stronger Outcomes+ Leader engagement & retention+ Career path clarity+ Advancement satisfaction+ Preparation for changing customer demands, digital business, and data-based decision making© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

1. Performance management is fair and transparent at
all levels (31 percent increase in effectiveness).
2. Performance management discussions focus heavily
on development planning (25 percent increase).
3. Performance management discussions occur
continually, rather than yearly (24 percent increase).

can naturally focus on how to improve performanceand ability, rather than argue about scores, during thediscussion with their subordinates.
More Attention to Personal Development
After finding that both development focus anddiscussion frequency were driving factors of performance
management effectiveness, we dug deeper to gauge whichmatters most. For organizations advising their leaders,
what should

The global data shows that performance management
works best when fair, focused on development, andfrequent. While these findings might not be surprising,it’s notable that only 38 percent of China companies
consistently have all three practices in place with theirleaders. That is, just because it’s logical doesn’t mean it’s
being done.

they recommend?
What leaders talk about matters far more than how
often, shown in the graphic at left. Engagement levels
for those whose performance is being managed surge
when at least 75 percent of the discussion centers on
development (only 10 percent of China leaders get thiscurrently). The primacy of focus over frequency is sostrong that it’s better to have a 75 percent focuseddevelopment conversation once a year than a 25 percent
development conversation weekly. While this certainly
isn’t recommended—frequency is important for manyother reasons given the pace and agility of business—itshows development’s dominance.

Stepping outside the core performance management
program, we looked at how this system relates to thebroader context of aligning and reinforcing leader
performance. Worldwide, high-caliber performance
management occurs simultaneously with several otherpractices: leaders exhibit and receive feedback on key
skills, leaders regularly review development plans, andthe organization has up-to-date knowledge of leadershiptalent capability (essential for analytics and workforce
planning).

The benefits of a development focus for performance
management are no less powerful for leaders andorganizations. For leaders, it’s strongly linked to career
path clarity, satisfaction with advancement, and strongly
counteracts turnover intentions. For organizations, it’s
linked to higher leader preparation to face businesschallenges of customer change, digital business, andusing data to guide decisions.

What’s the Impact of Dropping Ratings?
One of the most controversial, discussed (though rarely
researched), and disruptive trends in performance
management is the elimination of ratings. We foundthat 20 percent of companies worldwide and 26 percent
of China companies have done so. This shift wasparticularly common in rapidly changing markets: China
and India, and the professional services and technology
industries.

* Capelli, P., & Tavis, A. (2016, October), The Performance
Management Revolution, Harvard Business Review.

When ratings are eliminated, the impact on performance
management effectiveness is relatively slight—just a
7 percent boost was observed across the globe. The
elimination of the scoring system is indeed positively
related to the level of corporate leaders and the leadership
bench strength. Without the scoring system, leaders

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Establish process fairness and transparency.
Clearly communicate the factors used in ratings,
updating as needed when expectations change.
• Center the discussion agenda on development.
Though it’s rarely possible to focus solely on
development, prioritize it highest (ideally, 75+
percent) to maximize outcomes.

• Eliminate ratings only after recognizing the effects
and planning to fill the information gap. Dropping
ratings is linked to higher leader quality, benchstrength, and gender diversity. Companies that takethis step keep emphasis on talent status and often
repurpose to development the time once spent
discussing ratings.

• Target a quarterly cadence. More frequent in-depth
performance management discussions are linked
to higher engagement; however, these advantages
decrease beyond every three months.

• Match the frequency of performance discussions
to the pace of business. When discussions are held
more often, companies experiment more, are moreagile, and have better adopted digital technologies.

• Gauge satisfaction with career pathing andadvancement. The more often managers meet withand revise leaders’ performance plans, the morepositively they view career progression.

• Coach managers to drive engagement throughdevelopment discussions. Solid (and oftenreinforced) manager skills are vital to repeatedlyplan and conduct personalized, growth-focused
discussions.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Want to Be a Leader?
Get an Early Start“From the experiences of the past, we learn instructive lessons for the future.” So said John Quincy Adams, thesixth U.S. president, during his inaugural address. For the past few decades, we’ve talked about the degree to which
experiences shape leadership behavior. In Global Leadership Forecast 2014|2015, we showed the specific types ofjob experiences that shape leadership behavior. Experiences that impact a leader’s career can occur well before a
promotion to leadership or before that person enters the workforce. This finding examines earlier life experiences, anarea not previously addressed in our research.

The Earlier, the Better
The figure below shows the frequency of seven experiences and motivations from leaders. An early motivation to leadplays a significant role in a person’s decision to pursue a leadership position. Slightly more than 74 percent of China
leaders surveyed had leadership ambitions early in their life or working careers. Two additional early life experiences
may especially influence the motivation to lead:• Parents as working leader role models. 35 percent of leaders had parents who held leadership jobs.
• An elected or early volunteer leadership position. Nearly 67 percent of leaders held such a position (for example,
club president or sports team captain) long before they entered the workforce> Percentage of China Leaders Who Had Experience and Motivation

GlobalChina

Motivation to lead before asked
Served in leadership position before working career
Mentored someone else
35

Parents as career leaders
Formal mentor
22

Completed international assignments
7

Grew up in family business

41

52
44

67
64
63

74
76

69

28

14

© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

These findings are supported by a recently completed
study with The Conference Board, DDI, and RW2Enterprises on Millennial leaders* that involved
interviewing leaders at all levels in several Fortune 500
companies about experiences that shaped them. One
leader cited her parents’ role in providing lessons in how
people should be treated, and noted how this helped
mold her character. Another respondent recalled a
leadership position in school government.
PParents as leaders seem to have a stronger influence on
their children becoming leaders than does either having aformal mentor or being a mentor. That said, mentorshipnonetheless continues to provide considerable value todeveloping leaders. The lower percentage (7 percent)of involvement in family-run business might well trace
to lack of opportunity rather than the value of theexperience itself.

ead
ers
Ear
ly M
to L oti
ead vation
Pre
Rol work
es Lea
der
ship

sL
sa
ent
Par

Fam

ily B

usin

ess

> Early Experiences and Motivations with theGreatest Impact

OutcomeEngagement
and retention
Self-leadershipconfidence

Finally, international assignments can occur anytime
during a leader’s work life. Just over 22 percent of leaders
completed at least one international assignment. This is asurprising gap given the rising number of multinationals.

Number ofpromotions
Part ofhigh-potential
programGlobally, there was a small gender difference for twoof the early experience values. Female leaders weremore likely than male leaders to have had parents in aleadership role. Males, on the other hand, had more ofan opportunity to serve in a pre-career leadership role.
Perhaps gender role modeling becomes more criticalfor females in a male-dominated leadership work
environment. And, opportunities to lead may be lessavailable to females before they enter the workforce.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

We also asked all leaders if they felt prepared to deal withnine challenges associated with working in a complex
working environment. Examples of survey items included
operating in a digital environment, anticipating/reacting
to speed of change, and acting decisively without clear
direction. While not universal across all items, leadersacross the globe are better prepared to perform in today’scomplex work environment when they’ve had some of the
pre-career experiences.

Does It Make a Difference?
The figure above shows the global links between previous
experiences, motivations, and outcome variables, with acheck mark indicating a positive relationship. We looked
at leadership engagement and retention, leadershipself-confidence (a leader’s perception of his or her own
abilities versus those of peers), number of promotions,and designation as a high-potential individual. Bothleadership self-confidence and high-potential status havestrong relationships.

* Ray, R.L., Sinar, E., Wellins, R., Wright, E., Popiela, A., Ye, A.,& Paese, M. (2017, January), Divergent Views/Common Ground:
The Leadership Perspectives of C-Suite Executives and Millennial
Leaders, New York, The Conference Board.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Consider previous experiences as you makeleadership selection and placement decisions.

• Seek opportunities to place employees in informal
leadership experiences before they apply for or are
asked to fill a formal leadership role.

• Motivation to lead is essential.To be a successful
leader, you must understand the reasons behind.
It is hard to face the challenges imposed to
the leadership role or lead a team when you
have forgotten your original intention. Before
an interview or promotion, effective tools andinterview methods are necessary to make anaccurate assessment on leadership motivation.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• Explore the use of biodata to get a better read on
an individual’s probability of success as a leader.
Artificial intelligence (AI) soon will play a largerrole in examining prework and work variables in
predicting leadership success.
• Like marketing, IT, or any other profession, thinkof leadership as a profession. Never underestimate
the impact and influence you can have on yourchildren or the younger generation in encouraging
them to consider leadership roles inside and outside
the work place.
31

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The Rise of theDigital Natives
Are Millennials Ready to Lead?
Millennials are digital natives. They grew up in a digital environment and seem to embrace technology in all aspectsof their lives. Although we often take for granted that this generation will lead us in digitization, are Millennials reallyup to the challenge? Perhaps not as much as we would hope. When comparing preparedness to meet nine criticalbusiness challenges (such as navigating through complexity, chaos, and confusion; and acting decisively without
always having clear direction), Millennials—the generation born between 1982 and 2000—generally agree with their
Baby Boomer and Generation X counterparts about the challenges for which they feel most and least prepared, as
shown in the figure below. What is worth mentioning: compared to other generations, pertaining to the challenge ofskillfully applying data to direct decision-making, Millennials are the best prepared, as shown in the figure below. For
the on-position Gen Xers and older senior managers, how to leverage the strengths of Millennials in order to create
influnce on enterprises is a factor worth considering..
> As a Leader,
How Prepared
Are You to Meetthe Following
Business
Challenges
for YourOrganization?

Ranking of how prepared leaders are to meet nine challenges
CHALLENGEMILLENNIALSGENERATION X

BABY BOOMERSUnderstanding and acting on changing
customer needs and perspectives

1

1

2

1

3

1

Anticipating and reacting to the nature andspeed of change

2

3

1

2

1

2

Using data to guide business decisions

3

2

5

4

6

7

Maintaining effectiveness despite constantsurprises and a lack of predictability

4

5

3

6

2

5

Navigating through complexity, chaos,and confusion

5

4

4

3

5

2

Responding to competitive environment
faced by the organization

6

7

6

5

7

2

Operating within a highly digital businessenvironment

7

8

9

9

9

9

Acting decisively without always having
clear direction and certainty

8

9

7

8

4

8

Capturing organizational knowledge
before it’s lost

9

5

8

7

8

5

© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

32

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Global Leadership Forecast 2018 | China Report

Are Millennials Ready to Leadwith Digitization?

Leader Assessment of Effectivenessat Three Digital-Leadership Skills

Be it Millennials, the Generation X, or the post-war
baby boomers, none of them considered themselves asready for the “operations in a highly digitalized businessenvironment”. We took Millennials as the digital natives
where we assumed that their mastering of digital skills
is their second nature. Yet the result turned out as no
matter which generation they belong to, they need to getthemselves ready to face the environment on their own.

The percentage of the leaders rated themselves as effective
leaders.
Digital Literacy

Millennials

47%

Generation X

48%
40%

Baby Boomers

In the respect of the level of confidence in theirdigitalized leadership (shown on the right), it is not too
much different between the Chinese Millennials and Gen
X leaders. They have relatively good confidence in their“sensitivity to digital technologies” (despite only about
50% of them have). Millennials are less confident in theireffectiveness at leading virtual teams, perhaps because
they lack overall experience in leading teams.

Leading With Digitization

Millennials

38%

Generation X

38%
34%

Baby Boomers
Leading Virtual Teams

Millennials

Again, although Millennials rated themselves as more
effective than their older counterparts at some digitalskills, these skills were rated low across all generations.
Organizations will need to step up to prepare leaders
to keep pace with rapidly evolving technology
advancements. Apart from training, enterprises also haveto break down the boundaries all around and within, so
to achieve more cross organizational collaborations.They
would be wise to arrange additional training or to revamp
hiring and collaboration strategies to flow digital experts
into more functions.

35%
39%

Generation X
Baby Boomers

33%© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

We found this to be true in Global Leadership Forecast
2018 as well. As leaders climb the management ladder,they rate their effectiveness at mastering leadership skills
higher. Higher-level leaders, regardless of generation, aremore effective at connecting ideas, driving execution, andaligning toward common objectives. But there are some
generational differences as well. Millennial leaders acrossthe globe:• Rate their intellectual curiosity higher than othergenerations.

Differences Due to Generation
or Life Stage?
In 2017, The Conference Board and DDI collaborated on
the research report Divergent Views/Common Ground:
The Leadership Perspectives of C-Suite Executives andMillennial Leaders.* In that report, we found that muchof the difference we often attribute to generation ismore closely related to career or life stage. Millennial
preferences are not largely different from those ofprevious generations at similar points in their careers.

• Are more likely to seek feedback and input fromcolleagues and mentors.
• Are more likely to want “stretch” assignments.
* Ray, R.L., et al.(2017, January), Divergent Views/Common Ground:
The Leadership Perspectives of C-Suite Executives and Millennial
Leaders, New York, The Conference Board.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Leverage Millennial Strengths:• Define your company’s current digital
capabilities. Consider the digital skills leadersof all generations will need to move theorganization forward. Then, articulate your digitalstrategy to the organization so that leaders canimprove their own skills as needed.

——A. Find out programs to utilize Millenials’
specialities. Programs where “prognosis and quick
response”,”adeptness in statistical decision-making”
and “sensitivitiy to digital technologies” could bepracticed, should be Millenial leaders’ target.
——B. Allow millennial folk masters to shareprofessional skills in theenterprises. Let more of theexperienced staffs from other generations share
their knowledge learned from the workplace..
Communication creates mutual benefits throughsuch activities.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

33• Ensure that your leaders are equipped tolead with digitization. Create a task force ofMillennials to involve them as part of the strategy
development. If additional expertise is needed,
evaluate options for building or acquiring it.

www.ddichina.cn/glf2018

Generation X-Change
Don’t Underestimate the Powerful Influence of Gen
X Leaders
As companies grapple with how to transform and innovate better and faster, the population of leaders guiding
these decisions is changing dramatically. Most popular discussions about the next generational shift has centeredon the mass of Baby Boomers retiring or the eager ascension of Millennials into leadership. Often overlooked is thenext generation to leadership, Generation X, which is leading the way in a time of great change with technology
advancement, how jobs are automated and created, and how businesses are designed and transformed. Born between
1965 and 1981 and with an average of 20 years’ experience in the workplace, members of “Gen X” are primed to takeon nearly every important leadership role in organizations. They already hold 53 percent of leadership roles and willcontinue to grow into more senior positions. Yet, little is commonly known about what defines the Gen X leadershipexperience and style. It’s time for that to change.

> Four Key Findings on How Generation X Leaders from China Stand Out

751%

Direct reports on average(2 more than Millennials,
1 fewer than Baby Boomers)

Generation X leaders are
slowest to advance

Want more external coaching
than coaching from their own manager

Millennials

1.7
1.2

Gen X
Baby Boomersof Generation X leaders
are digitally savvy, on
pace with Millennials (50%)

Millennials

3%
12%

Gen X
Baby Boomers

0.9
Number of promotions in past
5 years with their organization

4%
Difference in percentage of leaders who want more
external coaching than coaching from their manager© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

34

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Global Leadership Forecast 2018 | China Report

X leaders, they have better 360-degree thinking and cankeep balanced in dealing with affairs and people.

The Early Technology Adopters
Although Millennials are most recognized for havinggrown up with technology, Gen Xers were earlytechnology adopters and gamers who use social media
more habitually than any other generation*. This has
translated to their leadership skill set. According to datafrom 3,404 China leaders, ratings from Generation X
show they are just as confident in their digital literacy as
Millennials, with slightly more than half of Gen X andMillennial leaders rating themselves as highly or very
highly effective (48 percent and 47 percent, respectively).

To promote company’s transformation, it needs toleverage the mature capabilities of Gen Xers as one
significant factor that might as well become a great boost.

Driving Growth Through External
Learning
Although most Gen X leaders aren’t looking outside fora new job, they are seeking more external development
and coaching than any other generation. (The data from
China indicates that only 20% of Gen X leaders want toquit their current job and find a new one.) In fact, leadersfrom this generational cohort are much more likely
than either Millennial or Baby Boomer leaders to prefer
external coaching over internal coaching. Most notably,
78 percent of Gen X leaders said they would like more
external coaching, compared to only 66 percent who
said they want more coaching from their managers—a 12
percent difference.

Slower to Ascend, But with HighCapability Maturity
Perhaps part of the reason that Generation X has
flown under the radar in the rise to leadership is thatit happened slowly. According to the data of Chinese
leaders in the survey, the Gen X leaders do not climb theladder fast in the company (see on left). Compared to thecounterparts of other generations, they only earned 1.2
times of inner promotion on average in the past five years,
in a contrast to the 1.7 times of Millennial leaders.

Gen X leaders expects similar learning methods as theMillennial Leaders.There is only one difference amongst
the top five they expect, which is that Millennials
expect more assignment of short-term tasks, while Gen
Xers expect more on-demand learning. It is logicalbecause Millennials are still in the early phase of theirleadership career, of course they want to experience
more. Gen X leaders, on the other hand, already haveadequate experience and expect more chances of ondemand learning. Thus, while planning the training anddevelopment, the enterprise can give Gen Xers morechances of outside training or external connection tomeet their demands.

But comparing Gen Xers’ effectiveness of 16 leadershipskills required in the digital era (see in the chapter of‘Leadership Under Digitalization’) to Millennial’s tofind the growth and decline, results in Gen X leaders
have 15-out-of-16 better strengths, except for the ability
to “lead with technologies”, than Millennials. They also
have their efficiency of overall leadership slightly higher
than Millennial leaders (51% vs. 50%), which represents
that Gen Xers has more confidence in their capabilities
compared to Millennials.
Second, Gen X leaders, in terms of 360-degree thinking,ideas linking, implementation and incentives giving,show better capabilities than Millennials.Namely owing
to the better structure of experience and practices of Gen* 2016 Nielsen Social Media Report, http://www.nielsen.com/
content/dam/corporate/us/en/reports-downloads/2017reports/2016-nielsen-social-media-report.pdf

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Build tech capability with the right tools. Gen X leaders have

• Encourage leaders to challenge the status quo. Gena unique perspective on how to work with, develop,
and leverage new technologies. Provide them, and allleaders, with the tools and support needed to leveragetechnology for greater business impact.
• Provide leaders with more external guidance. Encouragelooking outside the organization for coaching anddevelopment guidance, especially as leaders face
new and more complex business challenges forwhich they may not have internal mentors.
• Don’t promote generational stereotypes. As a matterof fact, from the result of the survey, generations do nothave much difference in terms of the challenges they face,
their capabilities and preferable learning methods. Avoid
catering programs to any single generation or group sothat you don’t alienate others. Seek cross-generational
feedback to improve outcomes for everyone.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

35

Xers are taking the lead at a time when change isregular and desirable. Provide them the freedom
and encouragement to try out new approaches andchallenge old ones to encourage innovation andgrowth.

• Leverage technology to support traditional development.

The large majority of leaders, regardless ofgeneration, said they want more traditional learning(internal coaching, external coaching, in-classlearning and individualized learning). Amongthe learning methods, “individualized learning”
is most expected by the two generations. Bymeans of technologies, it is possible to allot somepersonalized learning to the sudents: for example
use technologies to realize one-on-one coachingor IDP follow-up. Gen X and Millennial leaders willboth benefit from this technologicalinstruments fordevelopment. They can apply and control them attheir disposal.

www.ddichina.cn/glf2018

Diversity Leaders
Digital Transformation Starts from Inclusive Culture
Worldwide forecasts call for women to effect significant, increased economic and financial impact in the next decade,both as consumers and investors. Organizations have much to gain by engaging and leveraging female perspectives
within their workforces, and there’s plenty of room to grow as women still comprise a minority within leadershipcircles. According to demographic data gleaned from more than 2,400 organizations around the globe, womencurrently inhabit less than one-third (29 percent) of all leadership roles, with the large majority being in first-level
management positions. In China, 26 percent of leadership roles are currently occupied by women. Our global research
reveals that companies that have reached an above-average level of gender diversity overall (at least 30 percent) and at
the senior-level (more than 20 percent), outperform diversity laggards in key leadership and business outcomes. Whatcan we learn from these diversity leaders, and what are they doing differently? The graphic below depicts key practices
that enable a stronger pipeline of women at each leadership level.

>P ractices that Support Having a Stronger Representation of Women by Leadership Level

Firstand Mid-Level
Leadership

Senior-Level
Leadership
Invest in employee
health and well-being

Talent review processes
have reputation forbeing fair and objective

High-quality
development
plans in place

Leaders practice
key skills and get
feedback from manager

Formal mentoring
program in place

Development
is personalized

Managers regularly
review development plans

Leader development
begins with a diagnosisof strengths/weaknesses

Performance
discussions
are ongoing

Hiring and promotion
decisions rely on data

Managers who fail todevelop leaders receive
negative consequences

First-Level Mid-Level Senior-Level
Percentage ofleadership roles
by gender

Men

69%

71%

78%

Women

31%

29%

22%

© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

Don’t Single Out Women, Or Anyone> Impact of Greater Gender Diversity

Worldwide, our research shows that companies achievinga stronger balance of gender diversity sustain anadvantage beyond the numbers. Their leadership strategy
relies not on meeting any single demographic target
alone, but in integrating diverse perspectives into people,
product, and business decision making companywide.
Beyond succeeding with diversity-enabling practices
identified in the graphic, they stand out in two key ways:

1.4x

Sustained
Profitable
Growth1.5x• Inclusion is embedded within their culture.
Leaders from more gender-diverse companies
indicated that maintaining multiple and diverse
perspectives is critical to achieving success. They
were twice as likely as their low-diversity counterparts
to report that their leaders work together to create
new solutions and opportunities, and that multiple
perspectives determine success. They also reported
a higher level of collaboration across organizationalboundaries. Leaders from more gender-diverse
organizations were 1.5 times more likely to work acrossorganizational boundaries and create synergies intheir efforts.

Stronger
Growth Culture

1.7x

Leadership
Strength• Their leaders operate with different mindsets,
not skill sets. On average, leaders from more diverse
organizations weren’t particularly more skilled inany single leadership area. Rather, they were more
likely to demonstrate a strong focus on personal
development. This development mindset is enabled byorganizational practices that emphasize high-quality
development planning and more regular conversations
on personal development.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• Being faster-growing and more agile than their morehomogenous counterparts.
• More likely to experiment and embrace failure inpursuit of different and innovative approaches.
Their successes also translated to an impact on thebottom line. Organizations with greater gender-diversity
were 1.4 times more likely to have sustained, profitable
growth.

Succeed with an Inclusive ApproachThis collaborative, integrated approach to growing
leadership diversity translates to beneficial people andbusiness outcomes (see graphic at right). Diversityleading organizations, worldwide, were rated by theirleaders as:• Having higher-quality leadership.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Seek the best recruiting sources. Continuously
evaluate the different channels leveraged forrecruitment, and seek new ones. You can’t growdiversity if you’re not creating new ways of getting
new perspectives into the building.

• Reframe diversity goals. Not all diversity is easy—or
possible—to measure. It’s important to consider
and value the potential impact of any different
backgrounds and experiences that leaders canbring.

• Hire and promote for diversity. Leverage valid,reliable data on employee capabilities andpersonalities to guide hiring and promotion
decisions.

• Encourage knowledge-sharing throughmentorship. Provide new and early leaders withmentors from outside their own functional areas toencourage learning and exchange of diverse ideas.

• Seek out and encourage under-leveraged talent.
Encourage leaders to seek different perspectives
for new projects and reward teams that harness
inclusion of multiple perspectives to generate newideas and solutions.

• Continue to grow diversity. Provide highperforming women with stretch assignments tocontinue building their skills and cross-functional
knowledge.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

37

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Build a Coaching Culture
Want to Be a Better Leader? Ask a Peer or
Employee
Many organizations are fostering a coaching culture to reap benefits beyond senior-leadership levels. They’ve
expanded their focus to developing leaders at all levels and integrating coaching behaviors and expectations into
everyday conversations and formal talent management processes. In such a culture, learning can come from a variety
of sources: peers, managers, employees, and external coaches. When everyone in the company can be a coach,everyone benefits. Leaders often underestimate what they can learn from their peers and employees on their teams.
Global Leadership Forecast 2018 challenges notions of where learning can and should come from. For example, whenorganizations use peer and employee coaching, leaders are more likely to feel strongly engaged and accountable to thecompany and their team than when there is no coaching.

> When Everyone in the Company Can Be a Coach, Everyone Benefits

PEER COACHINGEMPLOYEE COACHING

IMPROVED LEADERENGAGEMENT© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

38

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Global Leadership Forecast 2018 | China Reportsatisfaction by those who were coached, and assessmentof behavioral change by managers.

Promoting Shared Leadership
Coaching by managers, employees, peers, or external
mentors promotes in leaders a stronger sense ofshared leadership. This includes working with others
across silos, collaborating to enhance organizational
effectiveness, acting as custodians of company purpose,and supporting critical activities that align with that
purpose.

While demonstrating the impact of coaching on businessperformance remains a challenge, Global Leadership
Forecast 2018 finds specific areas of leadership impactthat organizations will find valuable. Organizations thatuse coaching:• By direct managers and external mentors show greater
leadership bench strength, promote more leadersfrom within, and are more likely to have a pipeline oftalent to fill roles immediately.

A coaching culture emphasizes the skills of seeking
and listening versus telling someone what to do. When
asked for their input, peers and employees feel free tochallenge and provoke thinking or offer solutions thatmight not have been considered. Given the chaotic andfast-changing business environment, having leaders at
all levels of the organization (not just those at the verytop) coaching each other can provide greater agility tosolve problems across the enterprise. A coaching culture
creates space for these conversations and daily coaching
moments between leaders and teams, as well as between
colleagues and peers.

• In any form (from external coaches, managers, peers,or employees) cultivate leaders who have a greater
understanding of their future leadership career paths
and greater satisfaction with their advancement.
• With an external mentor experience lower leader
turnover (more so than with coaching frommanagers).
* Lui Abel, A., Ray, R.L., & Nair, S. (September 2016),
Global Executive Coaching Survey 2016, New York, The
Conference Board, https://www.conference-board.org

A point of disconnect found in the study highlights thatwhile China leaders—including high potentials—want
more coaching from external mentors (ranked number
1 on a list of 10 learning types), organizations aren’t
providing this method of learning (ranked at number 5of 10). This is an area of opportunity that companies canleverage to support engagement and retention.

What Is the Value of Coaching toOrganizations?
Measuring and proving the benefit of coaching are notsimple tasks, as it can be difficult to isolate its effects
from other activities. The Conference Board’s recent
study, Global Executive Coaching Survey 2016*, findsthat organizations tend to evaluate coaching efforts
with different approaches. Some of these include formal
and informal conversations with key stakeholders,monitoring coaching deliverables, assessment of

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Initiate and build a coaching culture by embedding
coaching elements into talent management
processes (training programs, performance
management processes, development plans).

• Enhance your coaching culture by designingpersonal and customized coaching solutions.
These can be targeted types of coaching(development-focused, transition, career, onboarding, team or group, and inclusion coaching).

• Develop leaders at all levels to be coaches.
Enhance senior leader communication aroundthe value of coaching and create incentives andrewards to reinforce coaching behaviors.

• Use analytics to measure and communicate theimpact of coaching. This can be a game-changer.
• Many organizations use internal coaches (formal
executive coaches who are also employees) whose
understanding of corporate dynamics and cultural
norms allows them to guide leaders in navigatingchange and integrate teams to boost performance.
Internal coaching can scale efforts in building acoaching culture and supporting a larger pool ofleaders lower in the hierarchy.

• Coaching often can be included in leadershipcohort programs as a strong complement to otherlearning activities.
• By including (and rewarding) coaching behaviors
in performance expectations, every leader at
any level can demonstrate the skills with peers,managers, and teams.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

39

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Mentoring for Impact
How to Maximize a Critical Leadership Experience
What differenciates a mentor and a coach: the coaching is based on raising questions, assisting the target to solve
problems or promoting his/her specific ability; mentoring, however, in most cases, is widely applied to the newlypromoted leaders and also can be called the master-student system, which aims to impart important knowledge andexperience to the target.
For many reasons, mentoring is one of new leaders’ most sought-after development experiences. Not only does it
enable them to gain broader, deeper perspective and knowledge of their business, but it also allows leaders to networkand connect with people outside their immediate functional groups. And its benefits extend beyond the individual
being mentored. Organizations that operationalize mentoring gain connections between new leaders and mentors,
keep practical experience and wisdom in house, and break down silos between functional groups. Yet, despite thepotential impact, only about one-third of organizations in China (39 percent) have a formal mentoring program fortheir leaders. What distinguishes the successful organizations, and what is the impact of engaging more leaders in>O rganizational Benefits of Having a Formal Mentoring Culture

46%

20%

higher leader
quality overalllower turnover

1.7x

23%

more capable ofcapturing organizational
knowledge before
it’s lost

more critical roles
can be filled
immediately© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

40

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Global Leadership Forecast 2018 | China Report

use the grassroots leaders as mentors to benefit theirdevelopment.

formal mentoring relationships? The graphic below
depicts some of the benefits and sheds light on why moreorganizations and leaders should engage in mentoring.

4. Few organizations offer formal mentoring fortheir leaders. Only about one in three organizations(39 percent) provide formal mentoring. This also
explains most of the experience leaders have had, are
not launched by companies.

Five Findings on the State of Mentoring
We explored the state of mentoring across the fullset of 2,488 organizations that participated in Global
Leadership Forecast 2018. We found that few factors
differentiate the organizations that offer formal
mentoring beyond the benefits they and their leaders
are receiving (see graphic at left). Here are the top fivefindings about mentoring from leaders and organizations
across the globe and China.

5. More financially successful organizations offer
mentoring. Globally, 54 percent of organizationsin the top third for financial performance haveformalized mentoring programs, compared to only
33 percent of organizations in the bottom third.

1. Most leaders have had mentors. 69 percent of theleaders in China have had a formal mentor.

Cross-Boundary Mentoring Establishes
Wider-Spread Knowledge Networks

2. More Millennials have had mentors. Even though
they’ve had shorter careers than their longer-tenured
counterparts, Millennials have enjoyed the mostmentoring opportunities. Just about half (74 percent)of the leaders from this generation already have had
a formal mentor, as compared to only 67 percent of
Gen X and 52 percent of Baby Boomer leaders.

When designed to cross organizational boundaries,
mentoring programs can facilitate an exchange ofknowledge and experience that informs younger
employees. These programs also put mentors intouch with other parts of the organization, elevatingknowledge transfer between disparate sections. In fact,organizations that encourage mentoring are alreadybenefitting more widely from these guided interactions.
Across the more than 25,000 leaders in our global
study, those from organizations with formal mentoring
programs were 1.7 times more likely to feel well preparedfor capturing organizational knowledge before it’s lostthan were leaders from organizations without formal
mentoring. Another cross-boundary option is to establish
a cross-Another cross-boundary option is to establish across-enterprise mentoring with other enterprises in theecosphere of the industry. This will foster and pass down
crucial professional knowledge and skills needed in time.

3. The rate of grassroots leaders mentoring othersin China is lower than the counterparts fromother levels. About 45% grassroots leaders have noexperience in mentoring others in a contrast to only
30% from other levels have not. It may denotes ourperspective that grassroots leaders do not possessenough theories or experience to be a mentor. Yet
this does not mean they cannot be good mentors foraverageemployees. In the chapter of “wanting to bea leader as soon as possible”, those who mentored
others in their early stage of career, their intention
and motive to lead is increased (the top three of‘early experiences promote willingness to lead’). It
is advised for enterprises to consider how to better

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Encourage formal and informal mentoring.
Although formal mentoring programs should
establish and foster guided connections andinteractions between junior and senior leaders,
it’s also valuable to encourage leaders andnon-leaders to seek informal mentorships,
especially in the reverse with senior leaders
seeking out their junior colleagues to gain new
perspectives.

• Build mentoring networks. Organizations can
go only so far in connecting and establishingmentorships. Foster peer learning by establishingmentoring networks, so that when there isn’t formal
guidance on a specific question or need, leaders
can seek the help and support of others throughout
the organization.
• Make mentoring a retention strategy. Leverage
mentoring connections to foster retention. Be
purposeful about matching mentors to juniorleaders who are at greater risk of turnover.

• Develop mentoring contracts. Mentoring is avaluable investment of a leader’s time to shareknowledge and experience. Provide mentors andtheir charges with examples of how to clearlycommunicate expectations for the mentoring
relationship, and also set guidelines in advancefor the mentorship.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Collective Leadership
Leading for Value Across Organizational
Boundaries
In the 21st century, operating environments and models will become increasingly complex across new geographiesand product/service lines with shorter half-lives than in the past. Navigating this complexity will require leaders
to work together more seamlessly across boundaries within and—with greater frequency these days—outside (forexample with partners and alliances) the organization. Collaboration is fast becoming a premium capability. In Global
Leadership Forecast 2018 we’ve identified what organizations with strong collective leadership have in common. Theirleaders work together effectively, create value horizontally, form multidisciplinary teams, and constantly bring diverse
perspectives together to work on their toughest issues. These organizations display strong—even turbocharged—
confidence in their ability to conquer many of the challenges facing the business world today. Of course, collective
leadership is not always appropriate; there are times when more directive leadership is required.

> Leader Capability to Meet Business Challenges in High Versus Low Collective Leadership Organizations

How Is Culture Different: High vs. Low Collective Leadership Progress

x2.5
52% – 22%

x3

x3

x2.5

42% – 14%51% – 17%

Capturing org
knowledge before it’s
lost (e.g., via turnoveror retirements)

Anticipating andreacting to the natureand speed of change

Responding to thecompetitiveenvironment faced by
the organization

Operating within ahighly digital businessenvironment

x2.7

x2.7

x3.2

x3.7

x2

x2

55% – 21%x3

54% – 20%56% – 21%x2

39% – 20%

Using data to guidebusiness decisions

Acting decisively
without always having
clear direction or
certainty

x3.0

x3.7

62% – 21%46% – 13%58% – 19%49% – 23%
Maintaining
effectiveness despite
constant surprises anda lack of predictability

x2.8

55% – 19%

40% – 15%52% – 14%x3
58% – 20%
Understanding andacting on changing
customer needs andperspectives

x2.7

68% – 25%

47% – 23%

Navigating throughcomplexity, chaos, andconfusion

x2.8

57% – 20%© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

The global data shows that constant learning is in the
DNA of collective leadership organizations. Leaders give
more feedback to each other, as well as seek it more often.
There’s a culture of learning that cuts across boundaries
as leaders work together toward a common cause: todevelop each other as they go.

What Is the Impact of Collective
Leadership?
Organizations with strong collective leadership (seefigure at left) make better-informed decisions. Theyuse data to guide their decision making, and they excel
at bringing in multiple perspectives from across theorganization. Collective leadership organizations arealso more confident in responding to the competitiveenvironment and acting on customer needs. The
collaboration process enables them to bring a breadth of
insight and experience, which, in turn, improves the rigor
of debate.

This translates to engagement and commitment.
Leaders bring more energy and find a greater senseof purpose in their roles (twice the levels of otherorganizations). They’re part of a wider team, which raises
their engagement and reduces their desire to leave by 10
percent versus organizations that don’t have collective
leadership.

Is Collective Leadership Always theAnswer?

So, What Underpins Collective
Leadership?

Globally, collective leadership organizations are foundto have less of an advantage for acting decisively or
effectively navigating complexity, chaos, or ambiguity. It
is not saying that the collective leadership is unnecessary,
but instructiions from strong leaders will eventually beneeded.

Collective leadership cultures are safe. Across theglobe, people in collective leadership cultures feel safer
to bring up tough issues—by more than twice the levels
within the other organizations. Psychological safety is amain feature of people’s ability to work collectively andcollaboratively. People are unafraid to admit a mistake,ask a question, or offer a new idea, confident that they
won’t be embarrassed or punished.

Collective Leadership Organizations
Develop Stronger, More Engaged
Leaders

Development becomes a team sport. Leaders incollective leadership organizations face challenging
conversations and get more opportunities to provide
feedback to senior leaders. They are more likely toprioritize creating chances for development andadvancement for all.

Finding the right leaders and building bench strength
poses an increasingly daunting challenge in today’s
business world. Asked what keeps them awake at night,
CEOs frequently tell us: “Do I have the leaders I need todeliver our strategy?”

Experiential practices support collective leadership.
Our global data reveals organizations that score highin collective leadership use experiential learning todevelop leaders. They’re three times more likely to adopt
coaching/mentoring for their leaders and five times more
likely to use stretch assignments to build critical skills
and to reinforce the culture.

In China, collective leadership is equated with:• Five times higher likelihood of a strong leader bench(48 percent versus 8 percent).
• Half the rate of leaders at high risk of leaving (3percent versus 5 percent).
• A superior the rate of “definitely engaged” leaders (73percent versus 40 percent).

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Create leadership teams that cut acrossboundaries and become models of collective
leadership. Give them real challenges to get theexperience of working collectively.

• Build teaming capability at scale. Support theeffective design and development of teams across theorganization, e.g. inclusiveness, hyper-collaboration, etc.
• Deepen empathy for the enterprise. Can all of yourleaders “stand in the shoes” of their peers? Do they
understand the importance of making decisions that
go beyond the interest of their function?

• Build skills that enable leaders to workcollectively. Work on game-changers like hypercollaboration, inspiring others, and leading in a
virtual world.
• Make your leaders aware of what it takes toestablish a safe environment. Do they welcome
divergent views? Do they understand that getting it
wrong is an opportunity to learn?

• Reinforce, recognize, and reward collective
leadership behaviors through formal and informal
incentives.
• Create a purpose-driven organization where allleaders and their teams drive towards common goals.

• Accelerate team performance by helping members
understand styles, leveraging differences to theiradvantage.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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It’s Time for Teams in
Leadership

The Power of a Shared Leader Perspective
Mounting pressures—complexity of work such that no one person has all the knowledge needed to solve problems,trends toward multidisciplinary work groups, and the rise of agile project management approaches—are renewing
attention on the unique and critical value of team-based work. Our research shows that these expectations aren’t
limited to individual contributors, but are also shaping the future of leadership. Based on data from more than 2,500
HR professionals, three of the top six skills viewed as most critical within three years are closely associated with teameffectiveness:• “360-degree thinking” to act on input coming from multiple sources and perspectives.
• “Hyper-collaboration” requiring leaders to work cooperatively with others.
• “Leading virtual and remote teams.”
Collectively, these forces raise the stakes for leaders’ willingness to work as a team, and for companies to respond inkind by enabling a culture of shared leadership.

> How Senior Leadership Teams Are Stronger with a Shared Perspective
Senior leadership teams

Senior leadership teams

POORLY ALIGNED

WELL-ALIGNED

Poorly Aligned Senior Teams Are Worse in:

Most Critical Areas for Alignment:– Bench strength (ability to rapidly fill critical leadership roles)– Ability to react decisively to change– Responding to changing customer needs+ Energy and development passion+ Future-focused leader skills+ Views on company culture© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

44

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Global Leadership Forecast 2018 | China Report• Future-focused leader skills: Identifying anddeveloping future talent, leading through digitization(that is, leveraging technology to manage theworkforce more effectively). Companies where seniorleaders are inconsistent in such skills see worse talentand business outcomes.

True Leadership Teams: Still a Rarity
For many organizations, shared leadership is anaspiration, not yet a reality. In China only a slightmajority (61 percent) of leaders feel either that theyand their peers are engaged in mutual influence andshared sense-making, or that leaders truly collaborate toenhance the company’s effectiveness (63 percent).

• Views on company culture: What kind of enterprise
culture is needed for the future? Which culture atpresent is worth keeping?To what extent do we expect
the cultural transformation goes? For the above
questions, if a unanimity cannot be reached in asenior leadership team, there could be a considerably
negative impact on the enterprise.

Other signs of cooperative leadership are even weaker.
For example, only 12 percent of China companies
extensively employ coaching from peer leaders as alearning method. Overall,Many enterprises, even as
accepting conceptually the ideas of the leadership team,show immaturity in their implementation.

Globally, organizations with well-calibrated seniorleadership teams have higher bench strength (ability to
immediately and confidently fill critical leadership roles).
They have leaders who react more decisively to change
and are better able to act on shifting customer needs andperspectives. These effects of a shared leadership mindset
are shown in the graphic at left.

The Risks of Top-Level Misalignment
It’s important to understand the consequences of atalent approach that doesn’t build commonality acrossleadership teams and that fails to see leaders as a groupneeding to be unified by common mindsets and mental
models guiding their decisions. At the senior-mostcompany ranks, these risks are particularly severe: They
can lead to entire business units drifting away from acore strategy and senior leaders who cascade a discrepant
set of operating and leadership principles through their
entire reporting structure.

Alignment Isn’t Constant Agreement
This research isn’t about seeking full agreement and alack of healthy debate among leadership teams. Someforms of tension certainly can be functional*. However,a lack of seni0r leader alignment on key cornerstonesof passion, talent growth, and cultural readiness for the
future notably weakens a company’s ability to build arobust leadership pipeline and to respond adeptly andwith agility to market and customer challenges.

In this research, we looked across data from multiple
members of more than 60 senior leadership teams acrossthe globe (C-Suite and executive VP-level leaders within
the same company) to gauge the impact on leadershipand business outcomes of leaders with widely varying
responses. We found three areas where a lack of seniorteam calibration—as shown by more variation acrossleader responses—was most damaging:* Leonard, O., Wiita, N., & Milane, C. (2017, September 18), TheBest Senior Teams Thrive on Disagreement, Harvard Business
Review.

• Energy and development passion: Vigor and energy
on the job; looking for opportunities every day todevelop employees. Organizations suffer when seniorleaders differ in their willingness to continually pushthemselves and others to grow.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Build shared mental models about leadership.
Create and socialize shared frameworks for roles
and expectations.

• Hire and promote for team profiles. Seek valid,reliable data about leader personalities and skills to
guide decisions about team composition.
• Use objective diagnostics to discern and act on
team-level patterns and dynamics.

• Experiment with agile methodologies. Agile
project management, once solely used fortechnology organizations, deeply incorporates
and can build momentum for team-based
approaches.
• Address misalignment in critical facets early.
Don’t let misalignment in passion, skills, andculture fester until they appear in their mostdamaging form at senior levels.
• Target unifying purpose through teamchartering.Help the newly-establishedleadership team to build a shared vision andmission and create the team spirit.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• Develop leaders in cohorts. Cohort-based
development builds commonality in how leaders
approach their roles as employee growthchampions and advocates, and in their skills to
identify talent and leverage technology to manage
the workforce, providing a safe forum for open
discussion of the company’s culture.

45

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Adjusted for Disruption
Top Drivers of Organizational Success ThroughComplexity and Change
Exponential technology and market change are motivating organizations and their leaders to continually rethink,redesign, refocus, and readjust. Within this complex environment, what might have made businesses successful inthe past can’t necessarily be counted on for the future. As a result, more organizations are looking to optimize theircapability to sense customer and market needs, shift stakeholder mindsets, and adjust their activities. Our global
research indicates that organizations rated as more agile by their leaders differentiate themselves in key leadership
practices that drive more informed, frequent adjustments. Paired with leader capability to sense and act on neededchanges, these companies are better prepared to anticipate trends, respond to competitive forces, and adjust tochanging customer needs.

>O rganizational Practices that Drive Organizational Agility—and Better Shift-Making

New solutions rely on
multiple and diverse
perspectives

77%

100
80

Leverage analytics
to forecast future
talent needs

68%

60
40
20

Integrate leadershipprograms andalign them withbusiness priorities

Use data to
guide businessdecisions

0

91%

63%
56%

47%

Reward failure inpursuit of innovative
or different approaches

Use formal programs toensure smooth leadershiptransitions at all levels

Percentage of Agile Organizations that Implement Each Practice© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

46

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Global Leadership Forecast 2018 | China Report

Sense, Act, Shift, Repeat> The Impact of Organizational Focus on
Internal Customers

Leadership
out
co
m

These organizations enable practices that improve theirleaders’ capability to sense and respond to change (seefigure at left). Specifically, they excel in three areas:• Informing decisions through data and analytics.
More-agile organizations in China leverage data
and analytics to fuel their sensing capability, with
86 percent of their leaders indicating that they’re
prepared to use data to guide business decisions.
This contrasts to only 72 percent at low-agility
organizations. They were also 2.1 times more likely toleverage data to make strategic talent decisions.

ithated w being mo
i
c
re
so
as
ag
s
e
1.2x
1.2X
More capable of respondingile

Organizational agility requires understanding andanticipation of how the market environment will change,
so that its leaders can maneuver successfully and rapidly.
Our research shows that more-agile organizations haveleaders who are better positioned to meet this challenge.
Globally, their leaders are 3.2 times more prepared to
anticipate and react to the nature and speed of change,
and 1.2 times more capable of responding to thecompetitive environment.

to competitive environment

3.2xMore prepared to anticipate andreact to nature and speed of change

4.6xHigher leader
engagement andretention• Integrating multiple and diverse perspectives
to drive successful change efforts. China leaders
in more-agile organizations are 1.7 times more likely
than their low-agility counterparts to collaborate andrely on diverse perspectives to create new solutions
and opportunities, and 1.3 times more likely to use
multiple perspectives to gauge success.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

Adjusted for Continuous Leader
Improvement
You can’t consistently anticipate how to succeed withyour customers without understanding their needs
and growing with them. Our research on over 2,400
organizations across the globe found that those thatexcel in their focus on external customers—who are moreagile and more likely to sense, act, and shift around thoseneeds—have been just as effective with their internalcustomers. As shown in the figure above, their efforts
pay off in leadership outcomes that will help ensure
continued success as they readjust efforts.

• Encouraging early-stage failures and rapid
iterations. Twice as many leaders at more-agileorganizations in China indicated that failure isembraced or rewarded in pursuit of innovative
or different approaches (57 versus 26 percent,respectively).

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Drive first for speed. Encourage leaders to seek
rapid deployment and feedback for new prototypes
so that they gather the information needed toquickly make decisions and adjust.

• Think big, act small. Rapid deployment of
new and improved capabilities requires quick
communication and decision making, which canbe enabled by a smaller group. Organizations
that ranked highest in agility were smaller in sizeand less likely to have grown in complexity due
to mergers and acquisitions.

• Identify data blind spots. Inventory data sourcesand determine if there are gaps in the informationneeded to sense for and make decisions.
• Create cross-functional, shared goals. Set common
goals across different parts of your organization
to encourage interdepartmental cooperation andcollaboration. This will help identify and remove
information silos and barriers that can impede
change efforts.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

47• Aim to “adjust,” not “adapt.” Organizations thatare more successful have adopted a mindsetof tinkering and adjusting. Adapting generally
implies change that happens over time, whereas
adjusting can be instantaneous.

www.ddichina.cn/glf2018

No Engaged Workforce
Without Engaged Leaders
China Companies Need to Grow Cultures that
Encourage Employees

The direct link between engagement and bottom-line results is clear to the leaders we surveyed. When asked how
they will drive better business performance, China respondents said they would focus on enhancing organizational
talent (72 percent), building a high-performance culture (61 percent), and engaging employees (51 percent). These
numbers indicate that although the Chinese leaders agree talents matter when hitting targets, they have only realizeda part of how the execution works. They have shown acknowledgement to develp the talents, but are still unawaredof the importance of elevating talent engagement. In aggregate, 95 percent of leaders told us they are engaged, and94 percent want to stay on with their organization to make an impact. These findings are encouraging, as leaders
continue to wield the greatest single impact on workplace engagement. But the findings, summarized in the figure
below, also reveal important areas where they need support—particularly in career development, a key driver of
employee engagement. The fact that 22 percent of leaders believe they will need to move on to advance their career isa wake-up call. Enterprises must pay more attention to the career development of these leaders.

Conversely, theyalso shared thatthey:

On a positivenote, leaders
told us that they:
98%

98%

Felt accountable for being aneffective leader for their employees

56%

55%

Did not have a written, up-to-datedevelopment plan

94%

95%

Were engaged with their role as aleader42%

44%

Did not agree that they areadvancing at an acceptable rate

93%

94%

Found their job full of meaning andpurpose36%

37%

Thought that they learned morefrom employees than from their
managers on how to lead

93%

99%

Committed time and energy to
growth opportunities

36%

22%

Expected to have to changeorganizations in order to progress
to higher levels of leadership

92%

94%

Did not intend to leave theorganization in the next threemonths34%

31%

Did not agree that their managers
were effective in supporting theirdevelopment as a leader

90%

84%

Looked for opportunities every day
to develop their employees

27%

23%

Do not understand the career path
as a leader within the organization© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

48

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Global Leadership Forecast 2018 | China Report

HR professionals in China indicated that only 50 percentof the leadership development programs they supervised
were connected to business priorities. Only 43 percent
of HR leaders report that their leaders have high-quality,
effective development plans, while only 54 percent reportthat their leaders have regular reviews of that plan with
their manager and only 53 percent deliver sequenced
leadership development programs – versus independent
events. No wonder many are unclear about theirleadership path and feel they must leave the organization
if they are to advance!

(79 percent) of these leaders support critical activitiesaligned with purpose. Well over half (67 percent) of the
China companies have articulated vision, mission, andpurpose statements; conversely, only 63 percent havean employee value proposition. Here, leaders can play a
crucial role in making the connection between the job
an employee does and the organization’s vision, mission,and purpose—a significant engagement driver.

To Raise Employee Engagement Levels,
HR Needs to Step Up

Provides a strong sense of meaning and direction by:
1. Developing a compelling vision of what people canaccomplish.
2. Communicating in a way that brings people along.
3. Setting a clear strategic direction for direct reports.

The findings in this study corroborate engagementrelated research at The Conference Board*. The 12
behaviors mastered by highly engaging leaders include:

HR needs to do a better job of supporting these leaders
because disengagement is infectious. And a toxic
culture can take years to rebuild. Engagement—and in
turn, retention—doesn’t happen by accident. It takes
concerted organizational effort, a motivated leader,and employees who take responsibility for their own
engagement. We also found a link between collaborative
cultures and higher retention.

Brings out collective brilliance by:
4. Building trust and acting with integrity.
5. Challenging the status quo and inspiring creativity.
6. Fostering a culture of collaboration.
Builds a high-performance environment by:
7. Setting high standards.
8. Creating a sense of urgency.
9. Empowering employees.

Leaders at all levels need support. A full 31 percent ofleaders in China have never had a mentor (though 63
percent mentor others) and, perhaps more disturbing
in a global work world, 78 percent of China leaders havenever had an international assignment.

Unlocks employees’ full potential by:
10. Building relationships one person at a time.
11. Providing clear and consistent rewards/recognition.
12. Driving development and growth.

Here’s good news: When rating their eﬀectiveness inusing inspiration (motivating increased employee energy
and eﬀort) and empathy (deepening relationships withothers by perceiving and acting on their emotions),
most leaders said they were at least moderately eﬀective
in using both skills (95 percent and 96 percent,respectively), which are hallmarks of an engaging leader.
Critically, they want to lead—71 percent see it as aleader’s role as custodian of the organization’s purpose
to a great or very great extent. About three-quarters* Ray, R.L., Hyland, P., Pressman, A., Dye, D.A., & Kaplan, J. (2016,
February), DNA of Engagement: How Organizations Build andSustain Highly Engaging Leaders, New York, The Conference Board,
https://www.conference-board.org

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Build engaging leaders. Forge a robust leadershipdevelopment program that will develop, retain, andempower leaders at all levels.

• Build an engaging culture. Start with the seniormost executive leaders becoming champions forchange. Like everything else, the tone starts
at the top.

• Ensure that the basics are in place: job
descriptions, behavioral anchors, custom
development plans, on-demand and formal training
programs, experiential learning opportunities, andcontinuous feedback.
• Align strategic projects with leadershipdevelopment efforts to ensure that leaders are
exposed early on to real-world challenges.
• Communicate the path for leaders as well as the
skills to master along the way. Set up a mentoring
program and teach managers how to coach so that
their now-enhanced engagement is contagious.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

49• Embed messages about the business case forengagement into all communications. Monitor
progress and celebrate successful milestones.
• Leverage your engaged leaders by asking them tomentor other leaders, participate in development
initiatives, and coach their peers.
• Reward and celebrate your highly engaging leaders;
they are the factory for your leadership cadre.

www.ddichina.cn/glf2018

HR’s New RoleAre Chinese HR Up to the Challenge?
In Global Leadership Forecast 2014|2015, we put forth the concept of a new role for HR, moving from the overused
term of “partner” to “anticipator.” Only a small number of HR professionals, worldwide, considered themselves
Anticipators. Even fewer leaders thought their HR colleagues fell into this category. Not more than six months after
the release of the Forecast, Harvard Business Review devoted an entire issue to the role of HR. The provocative titleof the lead article? “Why We Love to Hate HR and What HR Can Do About It.”* The opening salvo of this piecesummarizes the state of HR: Recent complaints about the HR function have touched a nerve in a large, sympathetic
audience. The most vocal critics say that HR managers focus too much on “administrivia” and lack vision and strategic
insight. Let’s take a deeper dive into HR’s changing and evidence-based actions to build their competence andcredibility.

HR Professionals: A New Role
We defined three categories for HR professionals:• Reactor: Sets and ensures compliance with policies; responds to business needs; installs basic initiatives tomanage talent.
> Shiffting Perceptions of HR’s Role over the Past Three Years in China

HR Ratings
22% 12%
ReactorLeader Ratings
60% 56%
Partner

43%

37%

ReactorPartner

2014

18% 32%20%

Anticipator

Anticipator

21% 28%
Reactor62% 59%Partner

17% 13%
Anticipator

41% 27%
Reactor48% 53%
Partner

2017

11% 20%
Anticipator© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

50

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Global Leadership Forecast 2018 | China Report• Partner: Works toward mutual goals with line
managers; shares information with the business about
talent issue gaps; provides HR solutions.

> Eight Practices that Anticipators Do More
Effectively Than Partners• Anticipator: Uses analytics to forecast talent needs;
provides insights and solutions to ensure high-quality
supply of talent; links talent planning to businessplanning.

Practices

Every HR professional must perform some tasks ineach role. However, while over the past decade HR
professionals have focused on their function’s operating
models, policies, and systems, they now must refocus
on how to manage talent strategically. HR must makethe transition to the Anticipator’s role, and that hasn’t
happened. In fact, as the graphic at left shows, the HR
function has regressed since 2014 as viewed by businessleaders.

$

In China, the data of 2014/15 and 2017/18 shows the
proportions of HR taking considers themselves as thePartner has not change too much. Comparing withthe last survey, the number of HR professionals who
think they are Anticipators drops by a half. Only 1/5 HR
managers (13%) regard themselves as Anticipators. The
number of those who think themselves as the Reactor,
however, increases more than a half (28%). The businessleaders show their confidence in HR; about 20% businessleaders believe that HR managers are Anticipators. The
data also indicates that HR managers in China, have hardtime chasing after the rapid changes in market growth.
It is hard enough to meet the current demands already.
They are snowed under already to react to current
demands.

Number of Times
More Effective

Link talent planning tostrategic planning

2.0x

Invest more development
dollars per leader

1.5x

Use an array of data andpredictive analytics

1.7x

Take a multi-level pipeline approach

1.4x

High-potential programs

1.5x

Use robust assessment data to
make hiring/promotion decisions

1.5x

Global mobility

2.0x

External mentorship

1.8x© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

Too often there’s a weak link between strategic andHR planning. In fact, only 28 percent of global HR
respondents feel that this connection is tight andstarts early in the planning process. Throughout
Global Leadership Forecast 2018, we’ve highlighted
the importance of predictive analytics, which are the
Anticipator’s lifeblood. And, for the first time, thetechnology is in place to better advance analytics.
Analytics are essential to maximizing your investments
toward improving leadership quality and supply.

Making a Difference
So how can HR professionals make progress?
Based on data from over 2,400 organizations acrossthe globe, we particularly researched how the roles of“partner” and “anticipator” operate differently in terms of
the practice of talent management .We have discoveredthat the most distinctive part of “anticipator” from otherroles is that it can link talent planning to enterprisestrategy.

* Capelli, P. (2015, July), Why We Love to Hate HR and What HR
Can Do About It, Harvard Business Review, www.hbr.org/2015/07/
why-we-love-to-hate-hr-and-what-hr-can-do-about-it

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Take a step back and gauge. Which of the threeroles best reflects HR in your organization? Don’t
forget to seek input from line managers.

• Deploy smart HR technologies to enable
leadership effectiveness while freeing up HR
professionals’ time to concentrate on the morevalue-added tasks their businesses require.
• Ensure that you’re building stronger predictive
analytic team capability.
• To foster excellent HR senior managers, it is amust to allow people to rotate in different businesslines so as to get equipped with substantial
battlefield experience. Or, recruit leaders frombusiness lines.
• Re-consider the HR structure. Most enterprises
adopt the “Business Partner” (BP) system.
Certainly, most people will consider themselves as
the partner. It is necessary to think over how the
HR structure will need to function specifically, in
analysis and planning for a further transformation
to the role of an anticipator.

• Move toward the Anticipator role by improving
HR capability in the eight evidence-based
practices described in the figure.
• Ensure that HR is well represented in yourcompany’s strategic planning process.
• Step up to greater accountability by providing
business leaders with the support and tools theyneed to bolster engagement, employees’ senseof purpose, and growth.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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HR Under Pressure
Falling Behind in the Race to Transform
The future of work is not tomorrow. It is now, and the implications for our workforces are profound. New career
paths, evolving organizational structures and business models, analytics, and digital disruption are trends every HR
professional faces. Never has the role of HR leadership been more important in making this transformation happen.
Business leaders no longer need to be convinced how important talent is. In a recent article, “The CEO’s Guide
to Competing Through HR,”* the authors conclude that HR needs to step out of its traditional silo and embracea strategic role, using talent to drive value rather than just responding passively to the needs of the business. To
essentially realize the “Organizational Strategy with Talents Going First”.
While HR leadership should be in an enviable position, in reality it’s losing the race. Their organizations are changing
faster than they are, putting them even farther behind. We’ve devoted two findings to HR leadership. The section “HR’s
New Role: Are They Up to the Challenge?” identifies the evidence-based practices that drive better HR performance.
Here, we address the changes HR leaders are experiencing and how prepared they are to meet key workplace
challenges relative to leaders in other roles.

> How HR Leaders’ Jobs and Attitudes Have Changed over the Past Three Years

Experience/Challenge% Decreased% Same% Increased

Making difficult
investment choices

16

31

36

29

48

41

Working acrosscountries/cultures

7

6

51

53

42

40

Available budget

25

13

31

27

44

60

Pressure to demonstrate
financial impact

5

9

39

46

56

46

Embrace new
HR technology

4

8

25

26

71

67

Need for analytic/dataskills

3

7

27

25

70

68

Reputation with seniorteam as trusted advisor

3

6

26

33

71

61

My own job engagement

8

4

28

30

64

66

My intentions to leave

28

28

47

50

25

22

© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

52

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Global Leadership Forecast 2018 | China Report

HR in the Pressure Cooker> HR Leaders Versus Other Leaders on Key
Challenges

For China, 478 HR professionals completed the HRspecific version of Global Leadership Forecast 2018, alongwith 3,404 leaders who responded to the leader version.
Additionally, eight percent of the leader population werein HR, giving us another rich source of data.

% Difference

HR Leaders vs All Others– 12

We started by asking HR professionals how their jobs
and attitudes have changed over the past three years (seefigure at left).

– 19

HR professionals reported a considerable increase forevery experience or challenge. In fact, only two items
rated relatively low: intention to leave current job andworking across countries/culture. Most notable, by far,is the impact of digital disruption on the HR role in theform of an increased need to up their game in applying
both HR technology (67 percent) and analytic skills(68 percent). Pressure to demonstrate financial impact,
also requiring keen analytic skills, was on the rise at
46 percent. Near the top of increases was the need to
become a trusted senior advisor. As we saw in the section“HR’s New Role,” perceiving a need to change is far
different than making one. For HR professionals, on amore positive note, 66 percent felt more engaged.

– 22
– 31
– 36
– 40
– 57

Business Challenges
Navigating throughchaos/complexity
Understanding/Acting
on customer needs
Acting decisively without
clear direction
Maintaining effectivenessdespite lack of predictability
Anticipating/Reacting tohigh-speed change
Using data to guidebusiness decisions
Operating in highly
digital environment© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

The graphic above is based on the global sample of HR
leaders’ responses to the leader survey. They were asked
to rate how well prepared they felt for each of seven items
characterizing the ever-changing work environment(volatility, uncertainty, complexity, and ambiguity). The
number depicted in the graphic represents the difference
between the “very effective” responses of leaders whoare in an HR role versus all other leaders. In every case,HR leaders felt less prepared than their peers in otherleadership roles. These responses are concerning. The
work world is experiencing considerable upheaval, yet
only one in five HR leaders, on average, felt very preparedto handle the challenges on the graphic.

workplace. Not an impressive number. By comparison,
only 16 percent of HR leaders felt the same way.
Consider this: The digital age will exert a more profound
impact on our workforce in about one-tenth of thetime of any other massive economic shift. Yet, thoseHR leaders who should be taking charge to prepare
tomorrow’s leaders are farther behind than those they’ll
need to support.
* Bafars, F., Ellsworth, D., & Gandhi, N. (2017, July), The CEO’s
Guide to Competing Through HR, McKinsey Quarterly.

Worse yet, the biggest differences are in their perceived
effectiveness to operate in a digital environment anduse analytics, despite the increased pressure they’refeeling to do so. For example, more than 37 percentof leaders worldwide felt very prepared for a digital

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Focus on building capability in businessacumen, advanced analytics, and new HR
technologies. Elsewhere in this report, you’ll
see that the areas where HR leaders are feelingpressured correspond to areas where theirperformance is perceived to be lacking.

• As “owners” of leadership development, one ofHR’s chief roles is to prepare leaders for digitaltransformation. Yet, HR leaders are less preparedthan leaders in other functions. Building HR’s digitalleadership skills is essential not only to develop
others, but also to manage impending radical
changes in HR technologies.

• We suspect that HR leaders may be underinvesting in their own learning as they strive tomeet the growing learning needs of leaders inother functions. In reality, HR should be first inline for increased resources and in a continual
learning mode.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

• HR professionals often label themselves as
the enablers of talent development, while line
managers are the real owners. HR leaders needto take primary ownership for ensuring that theirorganizations have the talent in place to meetcurrent and future business challenges.
53

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People Analytics
HR Mastering Data Analysis, Increases Promotion
Chance by Six Times

Percentage ofOrganizations
SucceedingThree-Year
Success Trend

ing
inte
rna
Res
lly
u
(e.g lts me., bteha rics
vior
cha
For
e
nge
)
tale castin
nt n g fu
eed turesLeadermo ship
del
pla
s
nni
ng
Bus
ine
me ss imtrics (e pact
.g.,
RO
Dat
I)
av
i
sto suaryte liza
lling tion
&
Ben
chm
ark
ing
ext
ern
ally

ark
chm
Ben

Effi
c
me iency/
tric Rea
s
cti

ons

Pressure on the HR function to adopt and excel in people analytics—defined as “the systematic identification andqualification of the people drivers of business outcomes, with the purpose of making better decisions”*—has been
intense for several years. Analytics are viewed as a prime route to greater strategic influence, and the thirst for deeper
analytics know-how has spawned a five-fold spike in interest over the past five years. Hundreds of articles have been
written in HR publications, dozens of conferences dedicated, and entire academic programs in HR analytics offeredat universities such as Cornell, Texas A&M, and New York University. With this steady drumbeat of exhortationand energy, surely HR has grown its proficiency in analytics methods since Global Leadership Forecast 2014|2015,
right? This current Forecast took a detailed view of analytics progress and practices across more than 2,500 globalorganizations to ask: What’s the status? What’s emerging? and What works to drive HR—and the enterprise—forward?

18% 18% 22% 17% 24% 17% 20% 9%
17%

20%

20%

23%

6%

16%

New
This
Year

> People Analytics
Practices:
Success, Trends,
and Impact

14%

Links to Leader
Bench Strength(larger circle =stronger relationship)

Links to Financial
Composite(larger circle =stronger relationship)© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

54

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Global Leadership Forecast 2018 | China Report

The figure below presents the state of people analytics
practices. The top two rows [ ] present the percent ofChina organizations succeeding in each analytics practicealong with the associated three-year success trend. The
bottom two rows [ ] show the impact of each analytics
practice in terms of an organization’s leader benchstrength and financial performance based on the global
data set of over 2,400 companies.

strength (the ability to rapidly fill critical roles withqualified internal candidates) and a financial composite
of revenue growth, operating margin, EBITDA, andreturn on equity.
Every type of analytics showed a notable link with one
or both outcomes, led by benchmarking internally,
creating leadership-planning models, and using datavisualization/storytelling techniques. On average,
companies excelling in these analytics were 6.5 times
more likely to have high bench strength and 3.1 times
more likely to outperform peers financially.

A Stunning Regression
Instead of an expected increase in analytics effectiveness,
we found that success rates declined over the past three
years for every type of analytics we compared (shown in
the figure at left). Though companies attempted analytics
more often than in 2014, these efforts were more likely tofail than to succeed.

It’s Not Just About the Numbers

It’s easy to make the mistake that analytics are just about
the numbers. But analytics also drive and exemplify
objectivity and fairness. Companies strong in people
analytics have more gender diversity in leadership(especially high-potential pools), a stronger culture ofpromotion from within, and higher leader success rates.

These struggles were common for more traditional typesof analytics (internal benchmarking and gathering
efficiency, reactions, or results metrics). On average,
only 19 percent of China companies were succeedingin these. The picture is even more bleak for emerging
forms of analytics, such as creating growth-centricleadership planning models, using “what if” scenarios toforecast future talent needs, and data visualization andstorytelling to compel the audience. On average, only 20
percent of China organizations succeed here.

The bottom line: More analytical practices are morediverse practices, and they reinforce strong “grow yourown” cultures. When analytics are in place, so are
objective decision-making tools, systematic processes,
and a bias-free, up-to-date status of talent.

Analytics as Accelerator

Analytics accelerate HR professionals deploying them:
Across the globe, those succeeding with advanced
analytics are 6.3 times more likely to have newadvancement opportunities and are 3.6 times more
likely to have a stronger reputation with senior businessleaders.

To put these declines in context, it’s important to gauge
whether this is a true backward step in effectiveness ora higher standard for success. Our data shows that it’s
likely a case of the analytics bar rising faster than HR
can leap over it. Despite low success rates, 68 percent of
HR professionals in China reported an increase in theiranalytics skills and data-driven decision making. Yet, thisclearly isn’t enough to keep pace.

And analytics accelerate talent practices, making good
ones even better. Companies that create leadershipplanning models, gather results metrics, and are adept
at data visualization and storytelling see a higher returnon their talent investments than those that neglect or
struggle with these practices.

Highest-Impact Analytics Practices

Though success rates are similar across analytics types,
distinctions between them become clearer when linking
to leadership and business outcomes. By doing so, we canshow which forms of effective analytics outperform theothers. The graphic at left shows the link between various
types of analytics and two critical outcomes: bench* van den Heuvel, S., & Bondarouk, T. (2017), The Rise (and Fall?) of
HR Analytics: A Study Into the Future Application, Value, Structure,and System Support, Journal of Organizational Effectiveness, 4,
157–178.

WHERE TO STARTHOW TO EXCEL + DIFFERENTIATE• Confirm business questions. Analytics that failto start with business (not just HR) questions
will be challenging to execute and, often, wholly
unpersuasive to stakeholders.

• Build skills in visualization and storytelling. Theseare powerful ways to communicate data; suchmessages are more memorable and persuasive thannumbers or text.
• Recognize analytics as change management.
Numbers mean nothing if they don’t drive action;
pair analytics with interactive data views to build
engagement about a practical path forward.
• Map talent scenarios to business strategies.
Sophisticated, high-impact workforce planning
matches talent needs to growth projections,ensuring that talent is where it’s needed and when.

• Get your data house in order. Spend time planning
your data foundation to avoid misinformed or
impossible analytics.
• Align effort toward highest-impact methods.
Internal benchmarking, leadership planning, andvisualization/storytelling had the strongest outcome
links in our research.
• Staff for data savvy. Analytics is a team sport;
develop and hire not just for abilities in data science,but also business acumen, visualization, and ethics.
• Adopt proven methods such as key driver analysis,
text analytics, survival analysis, decision trees, andscenario planning.
© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

55• Build internal and external networks. Seek
partnerships with data-minded individuals acrossfunctions, local interest groups, and internal
analytics centers of excellence.
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Global Leadership Forecast 2018 | China Report

Leadership Megatrends and Payoffs
The research summarized in this report shows the powerful and pervasive—yet rarely fulfilled—impact ofleadership practices on organizations striving to meet their business challenges, now and in the future. We’ve
delved into over two dozen findings focused on how these enterprise-level objectives are achieved. Each finding
includes precise, practical recommendations for learning from top-performing companies and for listening to andmaximizing the potential of leaders themselves. Now, it’s time to take a step back: first, to see the overarching
trends emerging from the research as consistent guiding principles flowing broadly into all aspects of leader
talent management; and second, for an integrated look at the links between practices and payoffs as fuel for
assembling a comprehensive leadership strategy.

Six Leadership Megatrends from Global Leadership
Forecast 2018> 	Digital Reshapes the Workforce: Across nearly every facet of the research, we saw the influence of digital

readiness. Digitally advanced organizations and leaders are already outperforming their less technologicallysavvy peers, who risk being left behind, permanently.

> 	Data’s Power Extends Beyond the Numbers: We expected to see data as an increasingly valuable commodity
for people and business decisions. But we didn’t anticipate the heavy influence data and analytics have on
business’ human side: inclusivity, agility, and fairness.

> 	Culture Looms Crucial: Leadership strategies will fail without solid cultural cornerstones—clearly grasped

and enlivened purpose, peer coaching, experimentation, psychological safety, and fully incorporated, diverse
gender and generational views.

> 	DIY Is DOA: Leaders who stand (and learn) alone—not given access to or eschewing coaching from peers

and mentors, and failing to adopt a collective, shared, and team-centric view of leadership—may survive inthe workplace, but they surely won’t thrive.

> 	The Potential Pool Swells to a Lake: Organizations taking a broad view of potential—expanding their reachto activate and accelerate leadership talent—prove more financially successful, feature stronger top leaders,and employ more women at every leader level.

> 	HR Navigates a Challenging Road Ahead: HR’s reputation as an Anticipator has taken a hit along with its

declining rates of analytics success. Also, HR’s own digital readiness is lacking. If this isn’t addressed soon,
HR’s ability to drive digital advancement will be crippled.

Leadership Practices Scoreboard
Across 2,400+ organizations, which practices have the strongest payoffs for leadership and financial
performance? The table on the facing page shows 34 leadership practices across four categories. The percentage
of organizations using the practice is indicated along with the impact that each practice had on three outcomesfrom the research: Program Quality (aggregate leader-rated quality of assessment, development, andperformance management programs); Bench Strength (supply of capable leaders for critical leadership roles
within the next three years); and the organization’s Financial Performance (composite of operating margin,
EBITDA, revenue growth, and returnon equity).
Key
No circle = nominal impact© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

= moderate impact

56= strong impact

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Global Leadership Forecast 2018 | China Report

Leadership Practices Scoreboard

High Potential

Development

Performance
Management

Talent Management

Leadership Practice(sorted in each section in order of highest to lowest frequency of organizational use)

Program
Quality

Bench
Strength

Financial Percentage
Performance
Using

Leadership development programs begin with a diagnosis of leader strengths/weaknesses.

62%

63%

Leadership competencies serve as the foundation for multiple leadershiptalent management systems.

61%

66%

Talent review processes have a reputation for being fair and objective.

61%

54%

Competencies required for success in key leadership positions are clearly defined.

58%

54%

Information from assessments and simulations is used to guide leader development plans.

53%

50%

Information from assessments and simulations is used to make leadership hiring and promotion decisions.

50%

51%

Individual leadership initiatives, programs, and processes are well integrated andaligned to key business priorities.

50%

50%

Systematic processes (e.g., strategic talent planning) are used to identify the quantityand quality of leadership required to drive future business success.

50%

49%

We know the up-to-date status of our leadership talent capability across the organization.

48%

55%

We use a formal process for identifying employees who could become global/multinational leaders.

36%

46%

We use formal programs to ensure smooth leadership transitions at all levels.

36%

47%

Formal mentoring programs are available for leaders.

35%

39%

We have a fair and transparent performance management system at all levels.

70%

67%

Performance management discussions occur ongoing rather than just once a year.

64%

71%

Performance management discussions include a heavy focus on personal development planning.

50%

59%

Ratings have been eliminated from our performance management process.

19%

26%

Leaders practice and receive feedback on key skills with their managers.

61%

62%

Leaders are offered a library or learning system from which they can choose on-demand courses.

48%

52%

Leaders receive development personalized specifically for them rather than as part of a cohort.

48%

44%

Leaders regularly review their development plan with their managers.

47%

54%

Leadership development modules are positioned with leaders as a planned sequencerather than as independent events.

45%

53%

We have a dedicated learning experience manager (someone who designs and sequences
personalized, engaging learning for leaders).

37%

40%

Our leaders have high-quality, effective development plans.

35%

43%

Managers who fail to develop their leaders receive negative consequences as a result.

27%

35%

High-potential leaders’ performance in developmental assignments is carefully evaluated.

77%

85%

Developmental activity for high-potential leaders is targeted toward their specificdevelopment needs.

76%

79%

Our process for identifying high potentials is unbiased and nonpolitical.

73%

81%

We collect objective assessment data on high potentials’ capabilities, potential, and readiness.

69%

65%

Managers are held accountable for supporting high-potential leaders.

69%

86%

The process for identifying high potentials is consistent across the organization.

66%

63%

We have a mentoring/coaching program specifically for high-potential leaders.

59%

67%

High-potential leaders are told and aware of their special status.

59%

62%

We measure the effectiveness of programs for developing high-potential leaders.

55%

63%

The identities of leaders labeled as high-potential are well-known within the organization.

41%

36%

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

57

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Global Leadership Forecast 2018 | China Report

Appendix: Demographics
Organization Characteristics
Industry

Presence in Global Market

Automotive & Transport

10%

National (operations located within one country)

62%

Energy & Resources

3%

38%

Finance & Insurance

6%

Multinational (operations distributed acrossmultiple countries and global regions)

Health Care

1%

Manufacturing

22%

Business Classification

Pharmaceuticals

6%

Public52%

Professional Services

3%

Private40%

Retail10%

Not-for-Profit

0%Technology

14%

Government

8%

Other

25%

Approximate Annual Revenue
Number of Employees< $5 million

5%

1–100

5%

$5 million to < $25 million

9%

101–500

17%$25 million to < $100 million

14%

501–1,000

11%$100 million to < $500 million

17%

1,001–5,000

28%$500 million to < $1 billion

17%

5,001–10,000

7%$1 billion to < $5 billion

17%

10,001–20,000

12%$5 billion or more

21%

20,001–50,000

7%50,001 or more

13%

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

58

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Global Leadership Forecast 2018 | China Report

Leader Characteristics
GenderLeader Level
First-level leader

51%

Male

70%

Mid-level leader

26%

Female30%

Higher-level leader

21%

Senior-level leader

2%

High-Potential Status

Age
25 or younger

1%

26–35

41%

36–45

44%

46–55

13%

56–60

1%

Over 60

0%

Yes

46%

No

54%

Generation
Millennial

34%

Generation X

62%Baby Boomer

4%

HR Benchmarks

We asked HR participants to provide general information about the makeup and turnover and success rates of theirleaders. The figure below provides median benchmarks from organizations across the globe. The bars represent thegeneral range of responses received from HR respondents (between the 10th and 90th percentiles); the green dots
indicate the average of all organizations; and the yellow stars indicate how leading organizations (represented by thosewith the highest leader quality and bench strength) responded on average.

100
95

90

70

72

60

62
59

60

60

30
20

67
66

31
29
26

56
53

0

Millennial
Leaders

FemaleLeaders

15

Success
Rate for
Internal
Promotions

43
38
30

0

Leaders
Promoted
Within

61
59

40
36

5

Success
Rate for
External
Hires

Expatriate
Success
Rate

Leading Organizations’ Average (Top 1/3)

90
72

50

25
15

85

73

45
35
27
25

10
0

80

75

50
40

90

85

80

Percent

95

13
12
12
0

10

42
35

31
30

5

Turnover Bench
Rate
Strength

HighPotential
Leaders

Global Average

China

10

HighPotential
Success
Rate

11
10
0

HighPotential
TurnoverRate© Development Dimensions International, Inc., The Conference Board Inc., EYGM Limited, 2018. All rights reserved.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

About DDI
With 1,100 associates strong worldwide, we work side by side with clients to build a sustainable pipeline ofleaders to meet business needs—today and in the years ahead. Because, like you, we believe better leaderslead to a better future, we have dedicated ourselves to the science and practice of leadership for nearly five
decades. Our solutions draw from our four areas of leadership expertise: Strategy | Selection | Development |Succession Management.
We’ve worked with clients to define and achieve great leadership at every level, from aspiring leaders all theway to the C-Suite. Our promise remains constant: Together, we can co-create a solution that is unique toyour organization and aimed squarely at meeting your business goals. To learn more about DDI, join us atwww.ddiworld.com

About The Conference Board
Founded in 1916, The Conference Board is a global, independent business membership and research
association working in the public interest. Our agenda is simple: to help leaders navigate the biggest issues
impacting business and better serve society. We believe in innovative approaches that make you think—and
act—differently. And everything we do reflects the input of our members and their real-world challenges.
We do this by delivering business insights. We connect senior executives across industries and geographies
to share ideas, and our experts create fact-based research and consensus-driven policy statements to help
leaders address their most important business issues.
Because we are independent, nonpartisan, and nonprofit, our work is trusted. If you learned it at The
Conference Board, you can count on it. To learn more about The Conference Board, visit us at conferenceboard.org

About EY’s People Advisory Services
EY’s People Advisory Services believes a better working world is helping our clients harness their people
agenda—the right people, with the right capabilities, in the right place, for the right cost, doing the rightthings.
We work globally and collaborate to bring clients professional teams to address complex issues relating toorganization transformation, end-to-end employee life cycles, effective talent deployment and mobility,
gaining value from evolving and virtual workforces, and the changing role of HR in support of businessstrategy. Our EY professionals ask better questions and work with clients to create holistic, innovative
answers that deliver quality results.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Global Leadership Forecast 2018 | China Report

About the Authors
Mindy Yeh , DDI , Managing Director
Greater China & Senior Vice President
and a principal consultant, Mindy Yeh
is the Managing Director Greater China,
Senior Vice President and a principal
consultant in DDI. She has severed
DDI for over 18 years and took the roleas Managing Director in DDI Greater China since 2013.
Mindy has abundant experience in Talent Management
and manages large engagements that involve executives
in corporations. She has served clients extensively acrossvarious industries in Mainland China and Taiwan, andgot solid insights and experience in Greater China.
She has consulted extensively with industries
including financial holdings, high-technology, service,biotechnology and pharmaceuticals, insurance, andfashion. She has published many articles and reports on
topics such as leadership development and selection, andhas spoken at several industry conferences.

Adam L. Canwell, a Partner, People
Advisory Services, Ernst & Young and a
global leader of EY’s leadership offering
based in Melbourne, Australia. He
has more than 20 years’ experience inproviding people advisory services toclients. He has delivered transformation programs acrossmultiple product and service industries – working with
FTSE 100 (or their equivalent) organizations. Adam has
an MSc in coaching and consulting for change from
HEC at Oxford University and an M.A. (Oxon) Politics,
Philosophy and Economics from Oxford University.
Rebecca L. Ray, Ph.D., serves as theexecutive vice president, knowledgeorganization, for The Conference Board.
She oversees the research planningand dissemination process for all threepractices areas (Corporate Leadership,
Economics and Business Development, and Human
Capital) and is responsible for defining the research
agenda that drives the company’s business planning
process. She is responsible for continuing integration of
The Conference Board’s research and engagement efforts.
Rebecca is author of numerous articles and books,
including her coauthored works Measuring Leadership
Development (McGraw-Hill) and Measuring the Successof Employee Engagement (ATD).

Evan Sinar, Ph.D., is DDI’s Chief Scientist and Vice
President. He designs and executes analytics linking
leadership programs to businessoutcomes and produces actionableinsights about talent trends andpeople practices, including leading
DDI’s Global Leadership Forecast
and High-Resolution Leadershipresearch programs. He is a top
influencer for analytics, data visualization, and people
science, frequently authoring on these topics for major
conferences and publications. His work has beenfeatured in Chief Learning Officer, Training Magazine,
and numerous other publications. Evan holds a Ph.D.
in industrial and organizational psychology and is a
Fellow of the Society for Industrial and Organizational
Psychology.

Stephanie Neal, M.A., is a consultant
in DDI’s Leadership Reach Center. She
conducts research to explore workplace
and leadership trends, including topics
focused on executive leadership andgender diversity. Stephanie is the authorof “Your Next CEO Should Be a Social CEO” and acoauthor of Ready-Now Leaders: Cultivating Women in
Leadership to Meet Tomorrow’s Business Challenges andWomen as Mentors: Does She or Doesn’t She? A Global
Study of Businesswomen and Mentoring.

Richard S. Wellins, Ph.D., is a leading expert on teams
and leadership. He recently completed a 35-year careerat DDI, where he was head of global
research and marketing. He currently
serves as a senior research associate forHR.com, DDI, and EY. Rich received his
Ph.D. from American University. He has
authored six books, including the recentYour First Leadership Job. He speaks atmajor conferences around the world and has publishedmore than 50 articles. His work has appeared in The WallStreet Journal, CNBC, Fortune, and the BBC.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

61

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Global Leadership Forecast 2018 | China Report

Liz Collins, M.S., is a Senior Manager
in People Advisory Services, Ernst& Young LLP. She has a Masters inorganizational psychology from
Columbia University and has spent
her career working with clients todevelop data supported workforce strategies in tandemwith the client’s talent management programs, people
key risk programs, and organizational and leadershipdevelopment activities. Liz works primarily withFinancial Services clients across Banking, CapitalMarkets and Insurance.

Amy Lui Abel, Ph.D., is managing
director of Human Capital at The
Conference Board. She leads research
efforts focusing on human capital
analytics, leadership development,labor markets, strategic workforce
planning, talent management, diversity and inclusion,
human resources, and employee engagement. Amy has
been published in People & Strategy Journal, The SAGE
Handbook of Workplace Learning, Human Resource
Development Quarterly, and ATD’s TD magazine.
Amanda Popiela is a researcher for
Human Capital at The Conference
Board. She conducts research in avariety of areas, including talentmanagement, employee engagement,
and diversity & inclusion. Her recent
reports include Mental Health and Well-Being in the
Workplace and Divergent Views/Common Ground: The
Leadership Perspectives of C-Suite and Millennial Leaders.

Louise Rolland is Executive Director,
People Advisory Services, Ernst &Young. She came from academia,
and her work focuses on all aspectsof workforce and talent strategy. Asa labor demographer, she has led aninternationally focused research agenda to investigate
the impact of demographic change and global labor
trends on business. She is a thought leader andpragmatic strategist who works closely with clients ondesigning practical responses to the changing world ofwork and the implications for leaders and their people.

Joe Dettmann, Ph.D., a Partner/
Principal, People Advisory Services,
Ernst & Young LLP and a North
American leader of EY’s leadershipoffering. He has a Ph.D. in industrial/organizational psychology andhas spent his career as a human capital and talentmanagement consultant. At EY, Joe has been
instrumental in the Future Work Now transformation
offering and helps clients design for the future ofwork and optimize their human capital by activating
modern talent strategies. As part of that, he has been
the architect of EY’s Future of Work Readiness Index
technology and has led the development of EY’s Digital
Leadership offering.

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

Tony Cotton is a Senior Manager,
People Advisory Services, Ernst &Young LLP. He is an organizational
psychologist and psychometrician
with over 30 years’ experience. He
has conducted workplace research inAustralia, Canada, and the UK. Tony has worked directlywith senior leadership groups in organizations acrossa range of sizes and functions providing high level
workplace research and statistical analysis of workforce
survey data. For five years, Tony was responsible forthe design and analysis of one of the largest workplacesurveys in the Southern hemisphere.

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Global Leadership Forecast 2018 | China Report

Sponsors
95 percent of the Fortune 500 companies in China. Visit
www.HRoot.com

Association for Talent Development
The Association for Talent
Development (ATD, formerly ASTD),
is the world’s largest association
dedicated to those who develop
organizational talent. These professionals take theknowledge, skills, and abilities of others and help themachieve their full potential. ATD’s members come from
more than 120 countries and work in public and privateorganizations in every industry sector. ATD supports thework of local professionals in more than 125 chapters,international strategic partners, and global member
networks. Visit www.td.org

Human Resource
Excellence Centre
Human Resource ExcellenceCentre (HREC) is China’s
upmarket, professional, and influential membershipbased organization for HR professionals. By the end
2017, more than 3,500 companies had joined HREC as
corporate members. HREC member services include
events, magazines, survey reports, public and inhouse training, corporate visits, etc. HREC is a premierresource for leading HR professionals in China to achieveorganizational goals and boost individual growth.

CNBC
CNBC, First in Business Worldwide, isthe recognized world leader in business
news and financial information,
providing the latest real-time market information,
unrivaled coverage of breaking news, in-depth analysis
and interviews with business leaders and political figuresfrom around the world. CNBC has a distribution of
approximately 409 million households worldwide. Visit
www.cnbc.com for more information.

Manufacturing
LeadershipCouncilFounded in 2008, the Manufacturing LeadershipCouncil’s vision is to create and inspire a global
community of manufacturing executives who believe inthe proposition that manufacturing is the fundamental
driver of economic and social prosperity, and that its
growth will lead to a better future and a higher standardof living for all people. The MLC’s mission is to inspire
manufacturing executives to achieve transformational
growth for themselves, their companies, and for theindustry at large through enlightened leadership.

HR Certification
Institute
For more than 40 years,
top executives have
put their trust in fully accredited HR Certification
Institute® (HRCI®) credentials when making hiring andpromotion decisions. As a result, more than 500,000
HR professionals worldwide have strengthened andadvanced their careers and strategic value by meeting
HRCI’s rigorous certification standards. Visit HRCI at
www.hrci.org

HRoot
HRoot is a leading humanresources media and Internet company in China, withbrands and services such as www.HRoot.com, Human
Capital Management magazine, Overclass, Society for
HR Executives, and more. More than 20,000 people
have attended HRoot’s offline events each year, while its
publications have a readership of 30,000. HRoot serves
more than 20,000 customers now, including more than

© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Acknowledgments
This study was a true global effort between three partners. The authors would like to acknowledge theinvaluable contributions of the following people:
Executive Stakeholder Team
Evan Sinar, Gina Dickson, Richard Wellins, Rebecca Ray, Amy Liu Abel, Sayed Sadjady, Adam Canwell
Project Management Team
Beth Gillen, Amanda Popiela, Liz Collins
Research Advisors
Mike Kemp, Sarah Mogan, Kirsten Jaeger, Frank Steemers, Ben Cheng
Graphic Design
Janet Wiard, Kelli Passalacqua
Cover Design
Susan Ryan
Editorial
Bill Proudfoot, Mike Gillen
Project Contributors
Ashley Heinrichs, Elizaveta Belfer, James Court, Daphne Luchtenberg
WebMark Hamilton, Stacy Infantozzi, Joe McBride, Keri Hritz
Global Participant Recruitment
Sinem Bahceli, Lucero Barbosa Martinez, Stella Chang, Elizabeth Chivers, Michelle Emanuele, Alex Fasken,
Priscilla Giglio, Frisca Harmala, Chiqui Ho, Julie Hogan, Yumi Ikeda, Sirin Kont, Sofía López de Aréchaga,
Christal Martin, Gayatri Patankar, Amy Reed, Charna van der Merwe, Sarah Zhu© Development Dimensions International, Inc., The Conference
Board Inc., EYGM Limited, 2018. All rights reserved.

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Board Inc., EYGM Limited, 2018. All rights reserved.

65

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