Leaders need hard skills, not empathy, say CEOs

Feb 13 2008 by Nic Paton Print This Article

Executives who want to get on in the business world should spend less time worrying about their "soft" people skills and more about getting the right "hard" technical, business, change management and international expertise under their belts, a new British survey has suggested.

The annual CEO study by PricewaterhouseCoopers has argued that what companies around the world are crying out for is CEOs with technical and business expertise, who have global experience, are strong leaders, innovative, creative and who can manage risk effectively.

People skills, while a bonus, were not seen as an essential, despite the fact that fewer than half of CEOs globally (and around a third in the UK) felt their HR department could manage the people agenda adequately by itself.

The survey of 1,150 CEOs around the world concluded firms were finding it hardest to find people with enough hard technical and business experience, with more than two thirds of those polled said they were having trouble finding people with this expertise.

The second most sought after quality was experience of overseas and global markets, followed by leadership capabilities and an ability to think creatively and innovatively.

In today's more uncertain economic climate, being able to manage risk was seen as a valuable asset, as was having the courage to challenge people and being able to adjust quickly to internal and external change.

More than half reported difficulties in finding people with the courage to challenge decisions, while those with the ability to collaborate or with language skills were generally much easier to find.

The survey echoes research published last month by management consultancy Accenture that found more than two thirds of executives are now deeply worried about the threat of not being able to recruit and retain the best talent.

Its survey of more than 850 top executives from the U.S, UK, Italy, France, Germany, Spain, Japan and China found worries about talent management had even crept ahead of competition as the key threat to future growth.

Creativity and innovation, combined with technical and business experience, the ability to change and the courage to challenge were the most sought after attributes in Asia Pacific, the PwC study found.

Latin American chief executives hankered after employees with global experience, and the ability to manage and anticipate risk was most sought by bosses in Central and Eastern Europe.

CEOs from Britain were more likely to agree that competitive advantage was likely to come from improved customer service (eight out of 10).

A similar number valued an the ability to change and the ability to access and retain key talent.

While nearly nine out of 10 CEOs globally agreed people management was one of their top priorities, this dropped to just over two thirds who believed their time was best spent on the people agenda.

Yet just over four out of 10 believed their HR department was equipped to deal with changes needed to compete for talent, falling to slightly more than a third in the UK.

The findings pointed to a potential increase in international demand for senior executives from mature economies such as the UK, where challenging others, innovation and leadership are established traits among top personnel, said PwC.

Michael Rendell, partner, said: "Many of the world's rapidly emerging markets are coming out of a manufacturing based model into one where services are more prominent.

"This will mean a higher demand for management skills common in the mature economies of Western Europe and the US. Executives here will have multiple employment options internationally and their current employers may find they have to work increasingly hard to retain them," he added.

"Right now, this situation is being compounded by volatile stock market performance which will lead some executives in larger UK organisations to question the value of their reward packages if they are substantially dependent share price performance," he concluded.

Paul Harper, spokesman for the UK-based Association of Executive Recruiters, continued: "It is interesting to see that the courage to challenge is in high demand. This plays to the strengths of UK executives.

"To challenge occurs naturally in the UK, it is part of the whole the whole mentality of working within companies and the experience of training in UK and US business schools," he added.

Elsewhere in the survey, bosses worldwide cited a lack of middle management motivation or engagement and lack of senior change management experience Ė which often revolves around hard skills as much as soft ones - as critical barriers to change.

Last month, PwC also revealed that CEO confidence for the year ahead had fallen for the first time since 2003, with the spectre of a U.S. slump continuing to play heavily on their minds.

While this crisis of confidence cannot, of course, solely be blamed on a lack of hard skills, a lack of confidence among leaders in the competences of their managers is unlikely to help confidence return anytime soon.