Hay Group Study Identifies Best Companies for Leadership
Eighth Annual Hay Group Study Identifies Best Companies for Leadership
Top Companies Encourage Leadership at All Levels, Driving Innovation while Achieving Operational Excellence
Auckland, 19 September, 2013 – Hay Group, the global management consulting firm, today released its eighth annual Best Companies for Leadership Study and Top 20 list. The study ranks the best companies for leadership around the globe and examines how those companies nurture talent and foster innovation in their ranks. This year, Procter & Gamble topped the list, followed by Microsoft, General Electric and Coca-Cola.
According to Hay Group’s study, the Best Companies for Leadership are purposeful and strategic in developing, enabling and motivating leaders throughout the organisation to do their best. In fact, 73 per cent of the Top 20 companies reported giving everyone at every level of the organisation the opportunity to develop and practice the capabilities needed to lead others, compared to only 47 per cent of all other companies. These future-focused companies also look ahead to what roles are ¬– and will be – mission-critical to their success, and then intentionally identify and develop leaders with the right skills to fill those roles. To facilitate this process, the Top 20 companies reported doing more to develop their population of new and mid-level managers, with higher usage rates of web-based leadership modules (72 per cent vs. 39 per cent at all other companies), classroom-based leadership training (80 per cent vs. 55 per cent) and mentoring by a senior manager or executive (68 per cent vs. 39 per cent).
“The Best Companies for Leadership recognise that many of the skills once required solely for senior leadership roles — high levels of emotional intelligence, commitment to continuous learning, analytical thinking — are now critical at every level of the organisation,” said Jacqui Millar, General Manager Hay Group New Zealand. “To excel in today’s highly complex and competitive business environment, the Best Companies are taking deliberate steps to develop and reward these competencies to enable their organisations to achieve operational excellence today, while driving innovation for tomorrow.”
In fact, 82 per cent of the Best Companies for Leadership use rewards that are based on rigorous measurements of performance against goals, compared to only 58 per cent of all other companies. Similarly, 89 per cent of the Top 20 companies encourage employees to set challenging or aggressive goals, versus only 69 per cent of all other companies.
At the same time, the Best Companies for Leadership foster a culture that encourages innovation. Seventy-six per cent of the Top 20 companies reward and stimulate cross-business-unit collaboration to improve performance and develop new business lines. That’s compared to only 54 per cent of all other companies. The Top 20 companies are also more likely to encourage employees to learn in areas outside of their area of expertise (70 per cent vs. 48 per cent) and reward employees for really new and different business ideas (77 per cent vs. 58 per cent).
“It’s becoming harder to create and run profitable businesses in traditional ways,” said Jacqui Millar. “Organisations have to think differently about how they relate to their markets. The Best Companies are adept at anticipating and meeting client needs at multiple points along the consumer spectrum. They’re shifting from selling products and services to becoming integrated business partners that can help their customers solve pressing needs.”
In fact, 78 per cent of the Top 20 companies reported that their organisation encourages employees to spend much time discussing customers’ future needs. That’s compared to only 55 per cent of all other companies.
Correspondingly, 90 per cent of the Top 20 companies reported that senior leaders communicate that the firm’s survival depends on adapting to evolving market trends, compared to 70 per cent at all other companies.
“In times of rapid change, many companies lose their focus, failing to adequately engage and enable their current workforce as the organisation shifts to achieve short term or immediate objectives,” added Millar. “Those companies that simultaneously execute on immediate priorities while aligning their employees with a shared sense of purpose and develop leaders at all levels to contribute and act on innovative ideas have a better chance at financial success.”
Other major findings from Hay Group’s Best Companies for Leadership Study include:
|The Best Companies develop, motivate, engage and enable employees||Top 20||All Other Companies|
|Actively manages a pool of successors for mission critical roles||85%||55%|
|Leadership development programs better enable employees to deliver on my company’s goals/strategies||84%||62%|
|Leaders work hard to connect people with projects that are personally meaningful to them||82%||61%|
|Senior leaders personally spend time actively developing others||74%||48%|
|Provides employees access to resources for innovation, even though success is not guaranteed||68%||47%|
|Leaders have the ability to generate personal and organisational loyalty||84%||67%|
|The Best Companies emphasise innovation||Top 20||All Other Companies|
|Provides structured opportunities for younger employees to promote innovative ideas to senior leaders||71%||54%|
|Treats failure (after a good effort) as a learning opportunity, not something to be ashamed of||72%||59%|
|Views employees in new start-up or innovation areas as having equal importance to those driving operational improvement||80%||56%|
|Provides employees with creative challenges rather than narrowly defined tasks||78%||62%|
|The Best Companies are globally aware and respect diversity||Top 20||All Other Companies|
|Requires an appreciation of global issues as a key job requirement||79%||46%|
|We actively recruit cultural minorities||71%||34%|
|Leaders are culturally savvy and have the skills to work effectively with diverse teams||84%||64%|
|Has a high proportion of women in senior leadership positions||59%||40%|
|The Best Companies emphasise environmental and social responsibility||Top 20||All Other Companies|
|Leaders are advocates for environmentally responsible business practices||89%||61%|
|Our leaders are change agents who initiate change towards higher environmental standards||86%||59%|
|Actively applies sustainable and energy efficient policies||83%||56%|
|Uses corporate social responsibility to recruit employees||68%||48%|
For more information on Hay Group’s Best Companies for Leadership, please visit the microsite www.haygroup.com/BCL, or join the conversation about #BCLeaders on Twitter at http://twitter.com/HayGroup.
Group’s Best Companies for Leadership
Hay Group has researched the Best Companies for Leadership since 2005. This year’s survey includes responses from nearly 18,000 individuals at more than 2,200 organisations worldwide. The survey was based on the organisation’s response to an online questionnaire and peer nominations. Respondents that completed the survey were from 125 countries, with 7 per cent from North America, 41.3 per cent from Europe, 1.1 per cent from the Middle East, 14.8 per cent from Asia/Pacific/Africa and 35.7 per cent from Latin America. To see the Top 20 list from 2005 through 2012, please visit the Best Companies for Leadership microsite www.haygroup.com/BCL.
About Hay Group
Hay Group is a global consulting firm that works with leaders to transform strategy into reality. We develop talent, organise people to be more effective, and motivate them to perform at their best. With 86 offices in 48 countries, we work with over 8,000 clients across the world. Our clients are from the private, public, and not-for-profit sectors, across every major industry and represent diverse business challenges. Our focus is on making change happen and helping people and organisations realise their potential.