Next Generation Leaders

Maximising your appeal to next generation leaders

When identifying potential future leaders, it is the conventional organisation and commercial needs that dominate the particular sector or functional role requirements. This answers the question of what we require today, but not necessarily what we want to be tomorrow. And explicitly what would appeal to those who will be leading our businesses tomorrow. Given the fact that we are experiencing rapid and accelerating change, we must also track the parallel social and employment practice changes happening, to complement the sector and functional needs.

There are many reviews of generational similarities and differences focussed on distilling broad trends in broad numbers across broad age-ranges. Here is one such example:

Most view these illustrations with a critical eye and question what is any different about the next generation of future leaders in 2019 compared to previous generations? Furthermore, beyond anecdotal observations, is there reliable evidence to show there are any trends that shape the context for identifying, selecting, deploying and developing next generation of leaders?

The prevailing evidence suggests six underlying trends that will colour how the next generation of leaders is identified, developed and motivated. Compared to other generations there is more of a focus on personal development, fit with prevailing organisational culture, greater awareness of diversity, employers who demonstrate progressive thinking and an eclectic approach to enhanced communication and knowledge sharing. Digitalisation and technological developments are likely to expand exponentially over the next few years. However, it is well established that the driving factors are people related (such as cultural predisposition, digital awareness, digital curiosity, preparedness to innovate etc.).

The focus within personal development has changed. Developmental opportunities are likely to be seen as more valuable by the next generation of leaders. A greater appreciation for coaching and mentoring has been found in next generation leaders, as they not only learn the required skills but also the individual experiences of the mentor.

Furthermore, increasingly varied information is available to these next generation leaders. Already we can see approaches such as listing news and worldwide updates, e-training and development courses, working online etc. as the standard.

Next generations leaders are also showing greater cultural awareness and sensitivity to their own and other’s fit. This may include attitudes to minorities/workplace diversity, promotion or growth opportunities, if they feel valued and work life balance. There is emerging evidence that these factors (rather than traditional promotion reasons) help explain why current future leaders are leaving, taking their talent with them.

Next generation leaders are attracted to forward thinking businesses who are introducing new technologies, strategies, concepts and products. This is supported by the number of successful start-ups but also in how innovative companies seem to attract the best talent. For example, new companies making more effective products which in turn create solutions different to those produced a generation ago, or the media focus on self-driving cars or robotised automated payment systems I.e. products that require sophisticated software that was not available in previous years (and is still developing).

Finally, effective communication styles have become a big topic in recent years driven by technology. Skills such as influencing, persuading and networking (the traditional human factors) remain critically important for those aspiring to the highest echelons of leadership. However, many agree that being connected globally 24/7 like no other generation makes the nature of getting things done very different. Next generation leaders will have to get this right in ways that are not currently clear and will change with time.

Technological advances, business transformation, developing social trends and the cut and thrust of commercial life are nothing new. However, it does look like we are at something of crossroads in the pace, direction and form of current and future developments. Consequently, these along with the changing expectations of the current and next generation of emerging leaders means a different emphasis and approach are necessary if we are to harness the potential we think we currently see in them.

If you are considering how to embrace the future leaders in your organisation and would like to discuss this in more detail, please contact Dr Stephen Sloan (stephen.sloan@normanbroadbent.com) or Angela Hickmore (angela.hickmore@normanbroadbent.com).

 

Church, A. (2018). The Future of C-Suite Potential in the Age of Robotics. People & Strategy41(1), 48-50.

Hickman, C. R., & Silva, M. A. (2018). Creating excellence: Managing corporate culture, strategy, and change in the new age. Routledge.

https://www.forbes.com/sites/walterloeb/2017/12/29/retail-trends-for-2018/#3ed4f90a4eca

https://www.inc.com/john-eades/executives-are-paying-close-attention-to-these-5-leadership-trends-in-2019-are-you.html

https://www.obforum.com/lederskap/leadership-trends-2019

https://www.obforum.com/lederskap/reverse-mentoring

https://www.unboxedtechnology.com/2019-training-trends/

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Industrials: Interim Update

Across the Industrials sector, Norman Broadbent’s Interim CFO Practice has supported a multitude of clients seeking advice, market insight, and benchmarking for singular and project hires. With Brexit negotiations going down to the wire, and increased pressure from competitors, the requirements for exceptional interim finance leaders has never been so strong across both PLCs and SMEs.  We are seeing a greater need for interim executives who are well versed in shaping and determining strategy, securing funding, liaising with key investors, and streamlining existing financial processes on large scale transformation programmes.

We recently partnered with a major UK transportation business that required our support in bolstering the CFO’s bench of finance leaders with career interim talent. The individuals selected from our network not only had precise functional expertise but also a solid and proven track-record of delivering within the sector. This particular client was seeking an Interim Group Finance Director for a sustained period whilst the current incumbent dealt with integrating a major overseas acquisition. The combination of our speed to hire, our 40-year-old network, precise shortlisting and vetting processes gave the CFO great confidence during a chaotic period. This has allowed us to build a good foundation from which we will continue to support with multiple hires during their M&A activity.

Since September 2019 we have also supported a major UK Water Supplier with a technically gifted Group Financial Controller, a Waste Management business with an Interim Head of Internal Audit and an Automotive supplier with an ERP Programme Director. Our clients have been utilising our Interim Executives for gap management as well as delivering finance transformation and change projects across their businesses. This has resulted in the achievement of significant cost savings, when historically businesses would have defaulted to utilising consultancy firms to bridge the gap where key technical finance skills are required.

At Norman Broadbent our experienced and high performing Interim Management team is regarded as a trusted advisor to business leaders and finance professionals. Our sector & functional expertise allows us to blend our knowledge of the Interim Executive markets, and most importantly provide a “best in class” solution for our clients.

Should you be keen to discover more about our services and how we may help you, or to discuss a specific assignment, please do not hesitate to contact me for an initial confidential discussion via kristian.lee@normanbroadbentinterim.com or on +44 (0) 20 7484 0119.

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Why Diversity is important

The CFO and their finance function are operating in a new and ever changing world. Organisations face almost unprecedented uncertainty, and the business environment is more complex, and evolving at a pace not seen before. In this brave new world, the finance function extends well beyond its traditional capabilities. Growing regulation has led to increased specialisation and complexity of some finance roles as strong technical skills are required. Furthermore, the growing role of finance as a Business Partner means many finance roles are increasingly orientated towards commercial and decision support with finance playing a central role in providing actionable insight that facilitates effective strategic decision making. As a result, the skills and experiences that finance professionals need to bring to the table are increasingly diverse.

In recent conversations, one of our clients (a technology firm who are well advanced on their digital finance journey) explained there has been a move towards recruiting finance business partners with heavy commercial creativity who are willing to challenge the status quo and capable of thinking outside of the box when it comes to approaching business problems. This prompted a debate around whether finance professionals are best suited to these roles on every occasion and whilst for the time being this is more often the case than not, they do envisage a future where candidates from a commercial background rather than a finance background take on these business partnering roles, further diversifying the blend of skills in the finance function.

It is not just diversity of skills that are required; it’s also diversity of ideas that are important to the finance function in a fast paced, ever evolving environment, where the ability to innovate, respond swiftly and challenge deep-rooted viewpoints has become essential for enhanced performance. There is a growing recognition that a wide range of perspectives and experiences is critical to the success or otherwise of businesses. A McKinsey report in 2018 found that firms in the top quartile for gender diversity are 21% more likely to enjoy above average profitability than firms in the bottom quartile. Indeed there is a growing recognition that a wide range of perspectives and experiences is critical to the impact finance can have on driving business performance.

We have seen this in the hiring patterns of our clients over the last 12 months in particular, as they become increasingly likely to make out-of-sector appointments and address diversity imbalances in their teams.

  • So far this year, 55% of our Finance Director appointments have been ‘in sector’ hires. This compares to 63% in 2018.
  • So far this year, 40% of our senior finance appointments have been female. This compares to 32% in 2018.
  • We have seen a 45% uplift in demand for our female talent pipelining service where we pipeline ‘next generation’ female talent. This service line has been especially popular in the construction, engineering and professional services sectors.

At a time when disruptive innovations and new business models are posing a threat to incumbents in the majority of industries, diversity of thought and experience are vital. By bringing individuals with fresh ideas into the finance function, companies will have a better chance of re-inventing themselves and in doing so improve their chances of staying ahead of the competition. The finance function of the future in top performing businesses is likely to be very different and more diverse in every sense than the finance function of today.

Wayne Poulton, Director, Finance

Norman Broadbent Solutions

wayne.poulton@normanbroadbentsolutions.com

DDI: +44 (0) 20 7355 6941

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“All Change”

The impact of the Queen’s speech, the Williams Review and Brexit on the Rail sector.

Despite the fact that the Williams Review is yet to be published, we were given a glimpse of what to expect in the State Opening of Parliament last month. For the rail sector, the headline of the Queen’s speech was that the discredited UK rail franchise model is to undergo a radical overhaul. Whilst the fact of the overhaul was not a surprise, the timing of it was unexpected, as it had been expected that this would be announced by Keith Williams, Chair of the Williams Review, and therefore the person who has been commissioned to review the rail network, rather than the Queen herself.

Normally the content of the Queen’s speech is well known ahead of time, but on this occasion the Prime Minister had slipped in a single line into her speech to address the rail sector. “Proposals on railway reform will be brought forward”, she stated, pre-empting the results of the Williams’ Review by several months and effectively instructing the Government to tear up the current franchise model and start again.

This acceleration sent a minor shockwave through a number of our TOC Clients. Although the announcement of reform had been expected, the adjustment of the timescales was a surprise. Despite that, the announcement has been well received by many of our clients, as it shows intent from the Government to take forward the outcome of the Williams Review in this Parliamentary term. Despite the fact that the conclusions of Keith Williams’ review are yet to be published, there is comfort to be taken from the narrative to date and the focus the Government is putting on improving UK Rail from both a passenger and freight perspective.

In light of the Queen’s Speech, the results of the Williams Review will now be published as a Government white paper, setting it out as a foundation for legislation and making the outcome more significant for those operating in the sector. It will also incorporate responses provided by the TOC and the wider sector earlier in the year.

Alongside this, the sector will also have deal with the impact of Brexit which, if it is implemented at the end of the month, may well lead to a General Election and a new Queen’s Speech shortly after.

With all this uncertainty, we are supporting and partnering with an ever increasing number of Rail Clients who are preparing their businesses and organisations for what will be both exciting and challenging times ahead.

With all the changes likely to impact your business following the Williams’ Review and Brexit, if you would like to confidentially discuss how Norman Broadbent could help you overcome both your business or people challenges, please contact Nick Behan on +44 (0) 0207 484 0106 or via nick.behan@normanbroadbent.com

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Consumer Sector: Talent & Market Intelligence

Customer insight: how much is too much?

This month, customer insight – the holy grail of retail and consumer marketing – has been a “red thread” through a number of our client discussions. Indisputably, we live in an age where personal data is king: snippets of customer information are gathered at each transaction by retailers increasingly seeking to personalise your shopping experience. At its simplest, this might be a site which requests your date of birth to surprise you with a treat on your birthday; or one which uses sophisticated AI to analyse your consumption habits to offer vouchers or promote products specifically designed to catch your eye – thanks to geospatial targeting this may even be whilst you are within a certain vicinity of the store.

On the surface at least, this is a win-win scenario; consumers are getting a personalised experience, being directed to products which match their needs more quickly, and getting the odd freebie/discount out of it. Meanwhile retailers are developing deep, authentic relationships with their customers, increasing brand loyalty and driving sales  – research from McKinsey suggests personalisation can deliver five to eight times the ROI on marketing spend, and can lift sales by 10% or more.

(link to https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/personalizing-at-scale)

Yet clumsy efforts at personalisation can be more toxic to a brand’s relationship with their customers than using no insight at all. It is a tricky balancing act. Consumers have come to expect a certain degree of personalisation in their interactions, whilst also becoming increasingly protective of their personal data. No one wants to feel that they are being stalked, or that every step they take online is being tracked, logged and added to an algorithm. There is evidence that consumers are just as unhappy with perfect personalisation as with clumsier efforts. In 2012 the US chain store, Target began crunching their data on pregnant shoppers, and discovered that by tracking their purchases back, a pattern emerged. They developed a list of products which, taken together provided a ‘pregnancy prediction score’. They could even predict customers’ due dates. This resulted in the infamous ‘outing’ of a teenage girl who received one of their personalised coupon books for products she would later need in her pregnancy, much to her father’s shock – but the key finding for Target was that their customers were not using the vouchers. They were uncomfortable with Target’s blatant display of their insight. They continued to create tailored coupon books – but mixed in a number of randomly selected offers alongside the targeted vouchers. Consumers were happier to use the vouchers now they felt they had received them by lucky chance, rather than the use of insight.

Amazon are the undisputed leaders when it comes to getting consumer insight right – log on to your Amazon home page and you will be confronted with items you have previously viewed; items recommended for you and items similar to things you have already purchased. They email you to tell you when a new book is out by an author you have read previously; or a new series similar to something else you have watched is released. Despite collecting vast quantities of data (particularly since the launch of the Amazon Echo, which has offered it a previously unthinkable level of access to personal data), it effortlessly guides consumers to what they want, without making them uncomfortable. However, they must continue to use this access wisely, or risk eroding their standing with customers.

If using insight is all about strengthening the trust your customers have in your brand, it should be easier for smaller brands who often have distinct and personable identities already. Andrew Smith, Director at Norman Broadbent recalls an email from high-end menswear retailer Charles Tyrwhitt asking for his input to a marketing campaign. “I really felt empowered, and wanted to engage with them,” he recalls, “it made me feel part of a community, connected with the brand.” Conversely, I continue to receive emails from one of their competitors, who shall not be named, but who have bombarded me for years with emails for menswear – despite the fact that, as a woman, I have only ever bought their womenswear. I now don’t shop there on principle.

In our interconnected digital world, consumers are becoming more alert to the use of personal data – for leaders, the protection of, and proper approach to, their customers’ data is increasingly crucial. An EY survey suggests we are less willing to share data than ever before (https://www.ey.com/uk/en/services/specialty-services/the-data-revolt—ey-survey-reveals-consumers-are-not-willing-to-share-data), while InMoment, an international customer feedback management specialist, recently released survey results suggesting that more than one fifth of consumers would not only leave a brand after a ‘creepy’ personalisation experience, but would also tell friends and family of it. [http://info.inmoment.com/rs/463-JAW-587/images/2018_CX_Trends_Report.pdf] We will never be able to block retailers’ access to it, but our increasingly sophisticated understanding of personalisation and its links to personal data mean that businesses must use their insight carefully. Poor insight – poorly targeted, clumsy, based on third party data, or part of a mass campaign – will do more harm than good, alienating consumers on a personal level. Good insight – discreet, useful, serving both consumer and brand needs – drives an authentic and loyal relationship between consumer and brand.

If you would like to confidentially discuss how Norman Broadbent could help you overcome your business or people challenges, please contact Lucie Shaw on +44 (0) 20 7484 0022 or via lucie.shaw@normanbroadbent.com

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A changing mix of proposition (and people)

Just when you thought it couldn’t get any worse, it did.

Thomas Cook went into liquidation … Ted Baker swung from a £24.5m profit to a £23m LFL loss for the 28 weeks to August 10 … and even Aldi, with its outstanding track record of growth, saw increased levels of competition which hit operating and pre-tax profits.

Despite the sector’s travails, there are bright spots evidencing continued (and ‘smart’) investment. Retail Week recently ran a survey benchmarking the UK’s top retailers’ digital prowess. Unsurprisingly, Amazon came out top due to its strength in logistics and ecommerce. H&M – having invested heavily in digital, logistics, and technology – came second. This is an impressive performance when one considers they were 18th last year!

But what does this changing and challenging landscape mean for those financial professionals within the Retail/FMCG space? Many CEOs talk of the ongoing requirement for radical change which is also needed “under the hood”. As one said, “We also need to improve financial performance by, for example, driving greater efficiencies, operational  rigour and transformation across Finance, Treasury, Procurement, and ERP systems automation”.

From our perspective, Norman Broadbent’s Interim Management Practice has seen a significant increase in demand for Interim Finance Directors and CFOs who have the commercial gravitas to work with (often recently appointed) CEOs. Many new CEOs have commented that their inherited finance leadership team lacks agility, pace, critical stakeholder management skills, is too binary to be commercial, and lacks the radical edge needed to drive change. Their wish-list includes having a CFO who can drive business transformation, handle complex commercial modelling, and relishes ERP implementation and the automation of back office tasks! In summary, with the volatility in consumer behaviour, a strong financial accounting and adherence to good governance will not be enough.

And what does life look like from the CFOs perspective? According to our CFO network they often feel hindered by the lack of data analytics and limited commerciality within their own (often inherited) finance function. So far this year Norman Broadbent’s Interim Finance Practice saw a 62% increase in demand for Internal Auditors, Treasury, FP&A/ Data Analytics and Group Financial Controllers. This demand has been driven by many digital retailers seeing significant growth without the financial pressures of large real estate commitments. As they have grown and acquired more customers, they need to further professionalise their group finance function to get ‘future-fit’. This is particularly the case for those who have ambitions to IPO or seek significant further investment. With cost, agility, and the importance of value-add, many clients are deploying Interim Managers to drive Transformation Programmes. Besides getting the work done in a more cost-efficient, time effective, and more immediate way than costly management consultancies, Interims offer knowledge transfer and the ability to upskill incumbent staff during any transformation programme.

If you would like to find out more about Norman Broadbent Interim, and how we may support you, please contact Jonathan Stringer for an initial confidential discussion via Jonathan.stringer@normanbroadbentinterim.com

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