The art of 21st-century leadership: From succession planning to building a leadership factory

Leading a global organization in today’s fragmented world is difficult—perhaps more difficult than ever.  There is a compounding and interconnected effect across all disruptions—and less and less time for leaders to react to them. According to the authors’ estimate that ten years ago, CEOs and top teams typically focused on four or five critical issues at any one point in time; today, the number is double that.

As the world grows more complicated, so must our perceptions of and approaches to leadership development. From the author’s work with leadership teams across companies, sectors, and regions around the world, as well as their own longitudinal research, they believe that six leadership traits are most needed to excel in today’s uncertain environment: Positive energy, personal balance, and inspiration; Servant and selfless leader; Continuous learning and humble mindset; Grit and resilience; Levity; and Stewardship.

Increasingly, the authors’ research and experience in the field suggest that organizations need to shift their leadership approaches in several core areas. Instead of managing with an eye solely on profits and preservation, leaders must also think about how to convey vision and possibilities (innovation) to all stakeholders. Instead of looking at value creation through the lens of scarcity and capitalizing on existing assets, leaders must consider opportunities to co-create with partners. Rather than simply command and control, leaders must collaborate and coach. And authenticity among leaders isn’t just nice to have; it’s expected by employees, customers, and almost everyone along the value chain.

Companies are still in the early stages of defining the craft of 21st-century leadership, but several best practices are emerging:  Engage—rigorously and relentlessly—with all key stakeholders; Enroll (and reenroll) the team; Build an operating model—and establish an operating cadence—that’s wired for speed; and Emphasize a culture of trust. 

When the authors ask CEOs and leadership teams about the biggest hurdles keeping them from achieving their aspirations and reaching their full potential, they cite talent and the leadership team on the field.  Some leadership skills can be taught in the classroom, but by and large, the most effective training and transfer of leadership skills happen on the job.  To address such issues, in the 1980s, former McKinsey global managing partner Ron Daniel coined the term “leadership factory” to describe just this dynamic—that is, colleagues investing their time in other colleagues, learning in situ, providing regular feedback, and sharing personal and collective insights, with the result of producing great leaders. The factory model that he envisioned some four decades ago is still successfully in place at McKinsey.  In their  work with global leaders and teams, the authors have observed several new additions to the factory model blueprint—guidance that leaders can use in their own leadership factories and leadership development curricula:  set leadership attributes; Don’t wait—get started now; Rethink how to build capabilities at scale; Lead self before others; and Empower leaders to build their own personalized, self-driven learning journeys.

The only certainty for today’s global leader is that things will remain uncertain. 2025 will likely be just as challenging as this year. So will 2026. It’s incumbent on leaders, then, to stop falling back on what’s worked for them in the past, adhering to business practices and rituals that have long since expired. Instead, they can collaborate with their teams, employees, and other key stakeholders to create the new rules of leadership.