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Can Today’s
Millennial Leaders Become
Tomorrow’s Great CEOs?

Challenging Thinking Series

Challenging Thinking is a series of Think Pieces—essays, videos, and other content—that ask and answer bold questions about leadership. While the leadership-related topics vary widely, each piece will inspire novel thinking.

All CEO positions will eventually be held by Millennials. But will they be ready when their time comes?

By Richard S. Wellins, Ph.D., and Rebecca L. Ray, Ph.D.

Millennial Thinking PointsIf you are a gambler, you could place multiple bets on the demographic composition of our future leaders. You could bet that global U.S. corporations will be run by a greater number of Chinese leaders. Or that people of color will rise to the top in greater numbers. Or that C-suites will have far greater female representation.

There is, however, one bet you could place you would be certain to win. In the not-too-distant future, those calling the shots will hail from one generation: Millennials. The reason is straightforward. In due time, those leaders from older generations will be long gone from their roles. They’ll be retired or, at the risk of sounding morbid, no longer present.

Now, the 18- to 34-year-old Millennials are 76 million strong—the largest living generation in the U.S. According to the U.S. Bureau of Labor Statistics, since 2005 the share of leadership jobs held by Millennials has ballooned from 3 percent to 20 percent. And, of course, the rise of Millennials isn’t just a U.S. phenomenon. Take a long plane ride to India, and you’ll find close to 700 million millennials—more than the entire U.S. population!

As many Millennials are already far along in their first leadership jobs, there are several questions we should ponder: What inner values guide their motivations and choice of companies and careers? What does their comfort level with technology mean for how they learn and develop? Will they be more like the current crop of Millennial CEOs—David Karp (Tumblr), Mark Zuckerberg (Facebook), and Leen Kawas (M3 Biotechnology)—or will their leadership styles resemble those of Howard Schultz (Starbucks) and Mary Barra (General Motors), CEOs whose ages place them in older generational groups?

The biggest question that hangs over the ascendance of Millennials is this: Will they really be ready when the time comes for them to become CEOs?

Dispelling Millennial myths

With the above questions in mind, Ron Williams, former CEO of Aetna and now the head of his own consulting company, RW2 Enterprises, asked The Conference Board to commission a unique piece of research comparing leaders from the Millennial generation to older generations of leaders, as well as to current CEOs. The Conference Board, in turn, asked DDI to join them in the research effort. The study involved 14 major corporations, including AMEX, UPS, Cardinal Health, Xerox, Verizon, and others. The Conference Board published findings of this research in a report, Divergent Views/Common Ground: The Leadership Perspectives of C-Suite Executives and Millennial Leaders.

The focus of the research was not Millennials as a whole but current Millennial leaders. The purpose was to determine how they differ from, or are similar to other leadership generations on a range of topics. A unique research methodology was employed, including both interviews and surveys, and statistical controls were used determine if identified differences were due to level of leadership or to generation.

In each organization, the sample included the CEO, CHRO, senior leadership team, Millennial leaders, and leaders from older generations (Baby Boomers, Gen Xers); over 2,800 leaders total participated in the study. Overall, through this research we found that, while there are some differences, there are far more similarities than differences between Millennial and non-Millennial leaders.

In addition, many of the findings refute the conventional wisdom and sometimes-negative stereotypes about Millennial leaders. Let’s explore a few of them:

Myth: Millennial leaders have little organizational loyalty, and will quickly job-hop from company to company to enhance their own careers and pocket books.

Reality: Millennials are, in fact, incredibly loyal. According to our research, nearly 44 percent of these leaders plan to stay at their current companies for more than 15 years, compared to just 29 percent of leaders from other generations who plan to stay that long. Meanwhile, while 14 percent intend to stay three to four years, only 11 percent of non-Millennial leaders plan for a similarly lengthy tenure.

While the percent of Millennials who plan to depart within one to two years is slightly higher than the percent of leaders from other generations (11 percent versus 7 percent), the numbers tell the story of a generation of leaders that are just as, if not more loyal than their older counterparts.

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One reason for their loyalty is that younger leaders are highly engaged with their leadership roles. When asked about their level of agreement with the statement “I am engaged with my role as a leader in this organization,” on a four-point scale (1 being “definitely false,” 4 being “definitely true”), Millennials rate their own level of engagement at 3.70. This is comparable to the 3.75 average response provided by older leaders.

Of course, this loyalty and engagement cannot be taken for granted and it doesn’t come without strings attached. Over and over during the interviews, we heard that Millennial leaders are hungry for growth in their current jobs and they expect to move up the ladder (see below). If this doesn’t happen, retention will falter.

Millennial leaders' expected transition time by level

Myth: Millennials will learn to lead in a fundamentally different way.

Reality: Just as leaders have for decades, Millennials assign the highest ratings to Developmental Assignments as the most effective way to learn. And, they seem to get those opportunities in relatively high frequency. Younger leaders also, predictably, give high ratings to Coaching from Your Current Manager and Coaching from Internal Coaches/Mentors.

The surprise here is that, as shown below, they rank relatively new modes of formal learning (social, online, mobile) near the bottom for effectiveness. Not only do Millennial leaders rate them as ineffective, but younger leaders also show no more hunger for those forms of development than do older leaders. Smack in the middle of the mix are formal workshops, classroom training courses, and the like—traditional forms of learning whose demise was supposed to be eminent with the rise of digital-based learning. But, as this research shows, these forms of learning continue to be used with relatively high frequency and to be perceived as effective.
Millennial leadership development methods effectiveness

Given the dynamic nature of both the global economy and the skills required of leaders in the future to be successful, the emphasis shouldn’t be on debating which learning method is better. Rather, the focus must be on creating meaningful learning journeys by blending a new array of learning technologies with current ones.

Myth: Millennial leaders have far different values than other leaders.

Reality: Yes, Millennials have different values than do their older counterparts and current CEOs, but the differences aren’t as dramatic as you might think. All leaders place the highest value on Ideas, Technology, and Rational Problem Solving. And, it’s encouraging that all generations place a high value on Actively Helping Others and Improving Society (CEOs rated the value higher than either of the generational leader groups).

There also appears to be agreement on the values that are less important. All generations and levels of leaders tend to shun History, Tradition, and Old-Fashion Virtues. They also don’t seem to have big egos. All leaders rate Fame, Visibility, and Publicity at the very bottom.

Two differences are surprising, however. CEOs place more of an emphasis on Creative and Artistic Self-expression. On the other hand, CEOs place less value on Business Activities, Money, and Financial Gain.

Myth: Millennials want a workplace that is open and fun. They also favor low-hierarchy organizational structure.

Reality: The cliched depiction of a workplace that appeals to younger workers is one with an open floorplan, perhaps access to snacks and cappuccinos, and very little hierarchy. But the research found that Millennials especially value two things in a workplace far more than “perks”: flexibility and mentoring.

When presented with a list of workplace characteristics (see graphic below) and asked to rank them in importance, Millennial leaders gave far higher marks to Flexible Policies for Vacation/Work Schedules and Flexible Options for Working Remotely/Collaborating Virtually— (Interestingly, these were also the top two characteristics identified by the other leader groups.) They want to work when they want, and where they want.

Designing a workplace for Millennials

Their third most important workplace characteristic was Frequent Access to and Mentoring by Senior Leaders. This reflects a firm belief in the importance of mentoring to all leaders surveyed (although CEOs themselves valued this more highly). As one of the CEOs interviewed put it, “[Millennials] want a lot of [mentoring] and quick.”

But while Millennials want access to senior leaders to get feedback and mentoring, they don’t see an open floorplan as important; they ranked this physical office space option as less important than did CEOs and older leaders. And while they want access to senior leaders and express a preference for interacting with them in a less formal way, Millennials indicate that having an egalitarian/low-hierarchy organizational structure was also a lower priority.

Millennial CEOs are coming. Will they be ready?

More than any other issue explored in the research, the findings related to the specific skills Millennial leaders will need to advance to the top levels underscore the challenges organizations face in preparing leaders to step up.

We asked younger leaders and CEOs which are the most valuable skills for leaders to have as they move from the first-level to top leadership roles. Their responses revealed that Millennials and current CEOs have different opinions on the importance of certain skills.

Millennials view Leadership Impact, Interpersonal Skills and Global/Cultural Acumen as the top skills that will be required by future CEOs. On the other hand, current CEOs rank Critical Thinking, Stakeholder Management, and Business/Management Skills as the most critical future skills.

CEOs, of course, have already risen to the top and may have a better perspective on what it takes to succeed. They are emphasizing harder skills over softer ones. On the other hand, Millennials may have a better view on tomorrow’s workplace—one that is agile and team-focused. One thing we do know from other joint Conference Board and DDI research (Global Leadership Forecast 2014 | 2015) is that leaders at all levels are struggling with the EQ portion of their role.

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Do these differing perspectives on skills portend a major change in organizations as younger leaders rise to the top? Time will tell, of course, but it seems unlikely that Millennials won’t leave their own generational stamp on the C-suite.

But will they be ready when the quickly approaching time arrives for them to rise to the C-suite? While it’s incredibly hard to predict one to two decades out, we are encouraged by what our research tells us about Millennials. In them, we have a group of younger leaders who are both loyal and hard working. They are highly engaged and eager to learn. They appear to have a good balance between the need for corporate responsibility and profitability. They are also incredibly ambitious—a full 46 percent see themselves in a senior role.

They may be more interpersonally adept, a plus for a workplace that will more and more require collaboration and the ability to engage others with a sense of purpose. And, they all will be digital natives, which will put them in a better position to transform their businesses.

And if organizations continue to identify and develop this next generation of leaders, it is safe to assume we will not be starved for great leadership. And, yes, they may be even better leaders than those in top jobs today.

Rich Wellins, Ph.D., is senior vice president at DDI and coauthor, with Tacy M. Byham, Ph.D., of Your First Leadership Job: How Catalyst Leaders Bring Out the Best in OthersHe is passionate about helping organizations employ alignment and analytics to realize the potential of their leadership capability.

Rebecca L Ray, Ph.D., is executive vice president, knowledge organization, for The Conference Board. She is the author of numerous articles and books, including her coauthored works, Measuring Leadership Development (McGraw-Hill, 2012), Measuring the Success of Leadership Development (ATD, 2015), and Measuring the Success of Employee Engagement (ATD, 2016).

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