Discovering the 21st Century Leadership

by Michael Lorz
A contribution to the Summit for the Future

Leadership has been a buzz word since the dawn of management research. Times are changing quickly and therefore the perspectives on leadership should change accordingly. This article explores 21st Century Leadership in a future business environment. By reading this article the person will grasp an understanding of leadership; see leadership as a process described in 6 concise steps; develop a new perspective on leadership and will gain a quick overview of a selection of the most pressuring trends impacting
on businesses in the near future. [...]

CHANGING TIMES

While the 1980’s were characterized by a rather static environment this has changed during the last 25 years to a very dynamic environment impacting on the way business is conducted. The technological advancement of telecommunication and the advent of internet have accelerated the rate of globalisation, deregulation and have brought a network- and knowledge based society that
is interconnected through online appliances. The consequence of changing business environments on leadership is that there is a need of defining the new requirements for future 21st century leaders.

Three major categories of influence on leadership have been identified during the research. These are global trends, organizational trends and follower trends. [...]

GLOBAL TRENDS

Global trends for the purpose of this research are business developments on the most abstract level. They constitute all trends that emerge external to the organization but still have the claim to have an impact on organizational developments as well as followers and leaders likewise. The implications of global trends are an ever increasing dynamism that is applicable to virtually all business processes. Technological advancements facilitate furthermore the connectivity between stakeholders on a global perspective. 24/7 accessible knowledge and an ever increasing level of knowledge intensifies the competition for innovative and cost efficient processes while products and services are easily comparable on a global scale. Emerging cost efficient Asian
companies compete with European companies on a global scale and increase price pressure on them. As a consequence the level of automation is increasing in companies located in European regions and thus the amount of required employees is decreasing while the knowledge share per employee is increasing.

ORGANIZATIONAL TRENDS

Organizational trends are developments that impact on the design of organizations and the way organizations are reacting to their environment. Leaders will not only be measured on material success in terms of business profits but as well on the interactions with all stakeholders internally and externally of the organization. Organizations need to be made “fit” for the dynamic environment; the uppermost aim is therefore flexibility in order to react quickly to changing global trends. The response is flattening hierarchies and network structures with units that may be deployed for flexible work assignments. Cost pressures force companies into specialization;
hence companies – or in future network units – engage in the work they perform best with the lowest cost structure and the highest possible quality.

While this specialization is taking place these units become more open to public scrutiny. The need to consider all stakeholders will become more central when making important decisions. Decisions will relate to a basic principle of “giving and taking” benefiting local communities and engaging in ecologically sound business.

FOLLOWER TRENDS

The followers of the leader change as the situation surrounding them is changing. Followers become increasingly diverse; this diversity is not only culturally founded but as well related to gender and age. Observing the global trends and organizational trends followers become
more knowledgeable and key information holder due to complex knowledge and company specific knowledge. While followers become more valuable to the company they are increasingly mobile and the idea of long life employment is not prevalent anymore. New talent/potential
management tools in order to bind this knowledge to the company and new approaches for knowledge management are challenges that a leader faces. [...]

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