Our Future Leaders

Our Future Leaders Today’s Business Leaders Reflect on Tomorrow’s Work World—From the Perspective of Their Children ABOUT THIS SURVEY In March and April 2017, Russell Reynolds surveyed more than 300 senior leaders, nearly half of whom sit in the C-suite, on what it will take to be successful in the workplace of the future. Eighty-eight percent of survey respondents were parents. The study consisted of an online survey fielded by ClearVoice Research and five in-depth interviews with prominent business executives.

2 | OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD Will Siris and Alexas fit seamlessly into the workforce? Will artificial intelligence replace the seemingly inextricable human element of leadership? Will organizations become more or less hierarchical, and will companies look at all the same?

We set out to understand what the future of work might hold for our children and generations to come. In the spring of 2017, Russell Reynolds surveyed and interviewed more than 300 senior leaders, nearly half of whom sit in the C-suite, on what it will take to be successful in the workplace of the future. Eighty-eight percent of survey respondents were parents, and we wanted to know what they hope their children and grandchildren will find when it’s time for them to join the working ranks.

OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD | 3 Overall, many of these executives, like many other A NEW WORLD—AND SKILLS TO MATCH experts, believe that technological advancements, AI Much has been written about how computers and and robotics will drastically change the future of work. technology will remake the future of work, and the But many said this metallic new world will place sur- executives we surveyed tended to agree. When asked prising value on warmth and humanity: Purpose-driv- which forces will most significantly impact how peo- en organizations will be best able to hire and retain ple work in the future, 28% of respondents said tech- young workers, while those workers will benefit from nological advancements and innovations, followed skills like creativity and problem-solving over pure by artificial intelligence and robotics (18%), and new technical know-how. Looking back at their own ca- disruptive models (16%). reers, these senior leaders also had insightful advice Interestingly, business leaders were even more likely for future generations. to rank artificial intelligence and robotics as a critical

EXHIBIT 1. TECHNOLOGY WILL REVOLUTIONIZE THE FUTURE WORKPLACE.

What will have the most impact on how people work in the future?

INTENSITY INDEX1 PERCENTAGES Technological advancements 100 and innovations 28%

Artiﬁcial intelligence 73 18% and robotics

New disruptive 68 business models 16%

Demographic shis like aging 56 populations and changes 11% in racial/ethnic mix

Shis in global 32 5% economic power

Outsourcing and oﬀshoring 30 to alternate labor markets 4%

Access to high-quality 27 4% healthcare

Improved mobility and 26 transportation infrastructure 4%

Scarcity of natural resources 23 4% and climate change

21 The end of retirement 3%

18 Continued urbanization 2%

5 Other 1%

1 To measure the degree of impact, respondents were asked to allocate 100 points across their answers. Source: RRA Future Leaders Study, 2017; n = 307

4 | OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD Conceptual skills will be far more important, as well as creative skills and the ability to function in unstructured environments. Vasant Prabhu, CFO of Visa

trend, perhaps already seeing the impact of these the organization (15%). Skills like collecting and pro- technologies in their daily lives. cessing information ranked dead last at 5%—because they’re viewed as easily replaced by technology. Because of these predicted tech advancements, executives say technical skills will become less import- In fact, the biggest skill needed in the near future ant, replaced by skills computers can’t copy—yet. may be the ability to react to whatever comes next. Respondents said the competencies their children Vasant Prabhu, executive vice president and chief fi- and grandchildren will need most to succeed in the nancial officer at Visa, has learned a lot about reacting future workplace include the ability to make decisions to change in his 30-plus-year career, including lead- and problem-solve (18%), think creatively (16%), and ership roles at NBCUniversal, Starwood Resorts and communicate verbally with people inside and outside Safeway, as well as a seat on the Mattel board of direc-

EXHIBIT 2. FUNDAMENTALLY HUMAN SKILLS, LIKE PROBLEM-SOLVING AND CREATIVE THINKING, WILL BECOME CRITICAL.

What skills will future generations need most to succeed in the workplace of the future?

INTENSITY INDEX1 PERCENTAGES Making decisions and 100 18% solving problems

93 Thinking creatively 16%

Communicating verbally with 91 people inside and outside the 15% organization

83 Inﬂuencing others 13%

69 Working in a team structure 11%

Being proﬁcient with the 64 9% latest technology

50 Analyzing quantitative data 6%

Planning, organizing and 42 prioritizing work 4%

Developing technical 38 4% knowledge related to the job

Collecting and processing 31 4% information

1 To measure the degree of impact, respondents were asked to allocate 100 points across their answers. Source: RRA Future Leaders Study, 2017; n = 307

OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD | 5 The most valuable learning experiences often involve adversity, so don’t just chase what looks cool at the moment. John Donahoe, CEO of ServiceNow

tors. Reflecting on the skills his 16-year-old daughter also affording their children and grandchildren work- and her peers will need to succeed in the future, Vasant life balance (18%), visionary mentors (16%) and lead- homed in on an ability to handle constant change. ership opportunities (15%).

“Conceptual skills will be far more important, as well Some executives commented on what it will mean as creative skills and the ability to function in unstruc- to be a leader in the future, especially in the startup tured environments,” he said. “There’s no question world. John Donahoe, CEO of ServiceNow, has seen that leadership will change as well. Twenty to 30 years this change firsthand in his own children, three of ago, you got a position, you got the authority. Today whom work in the tech industry. John is no strang- you get a position and you earn the authority. May- er to tech himself, having served as the CEO of eBay be in the future, you will have to earn your authority and on the boards of Intel and PayPal. But he says to- every day.” day’s tech leadership needs to understand the value ORGANIZATIONS OF TOMORROW of adversity. Business leaders of today had high hopes for the or- “We are in an era where the pace of change is accel- ganizations their children and grandchildren will join erating,” he said. “Leaders of the future will have to in the future. be adaptive and be able to drive change. Learning Executives hope the organization of the future is both from a wide variety of experiences and learning to highly flexible (33%) and entrepreneurial (15%) while work with a diverse set of people are increasingly

EXHIBIT 3. LEADERS ADVISE PASSION OVER PERSONAL PROFITS.

What one piece of career advice would you offer future generations?

INTENSITY INDEX1 PERCENTAGES

100 Pursue your passions 37%

80 Persevere 30%

58 Do good 22%

17 Family ﬁrst 6%

4 Financial stability is No. 1 2%

8 Other 3%

1 To measure the degree of impact, respondents were asked to allocate 100 points across their answers. Source: RRA Future Leaders Study, 2017; n = 307

6 | OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD I’d be remiss if I didn’t educate my kids about business … I was so naïve when it came to things like job opportunities. Christa Quarles, CEO of OpenTable

important because they make you more adaptable berly-Clark board of directors, she’s happy to be able and empathetic, both of which are helpful in driving to pass her business acumen on to her children. She change. And the most valuable learning experiences said her sons love that she works because they can often involve adversity, so don’t just chase what tell it makes her happy and fulfilled. looks cool at the moment.” “I’d be remiss if I didn’t educate my kids about busi- John also stressed that future leaders should pursue ness,” she said. “I want them to know and understand their passions and pay attention to what gives you a what I do. It has to help. I was so naïve when it came sense of purpose. He wasn’t alone in that belief. No- to things like job opportunities. My kids will be better tably, the survey found that executives emphasize off because they’ll have sounding boards.” purpose—not just the bottom line—as the ideal way to work. Purpose-driven organizations were ranked Regardless of whether they hoped their children by executives as the second-most-appealing future would follow in their footsteps, many leaders surveyed workplace scenario (19%). stressed the importance of finding fulfilling work. In fact, “pursue your passions” (37%), “persevere” (30%) CAREER ADVICE FROM MOM AND DAD and “do good” (22%) are the three most critical pieces Roughly two in five business leaders surveyed said of career advice business leaders would like to instill they would encourage their children or grandchildren in their children and grandchildren. to follow in their career footsteps, with C-suite executives more likely than SVPs, VPs or directors to be very Following passions was even more important advice encouraging of their progeny becoming future titans among executives, perhaps demonstrating a growing of industry. trend among younger generations to find purpose- driven work versus an older, more practical mindset. Among the reasons these leaders want their children and grandchildren to follow in their footsteps, they Yet some executives were concerned that many kids cited being able to influence people, companies and today face high-pressure environments that make it even society while being able to earn a comfortable challenging for them to identify their passions early on. living. In contrast, executives who wanted their chil- David Wyshner, most recently president and chief dren to choose other careers were concerned their financial officer at Avis Budget Group, sees this pres- jobs would no longer exist in the future or felt their sure firsthand in his children, a 17-year-old son and children wouldn’t be fulfilled pursuing them. a 14-year-old daughter. David, who served as Avis Whether or not their children follow their career paths, Budget Group’s CFO for more than a decade after a some executives touched on the importance of their career in investment banking, said today’s kids are function as role models for future generations. growing up increasingly quickly.

Christa Quarles, CEO of OpenTable, discussed how “The faster that things seem to move, the faster her career may help her impart advice to her two younger people aren’t young anymore,” he said. “How sons, ages 9 and 6. Christa said she didn’t benefit do kids at 17 figure out that they want or don’t want to from business conversations around the dinner table be engineers? They aren’t all that well positioned to with her own parents, a teacher and an engineer. And answer since they are not given a lot of context, nor while that hasn’t held her back from a career that’s do they have the experience to be making those deci- included leadership roles at Walt Disney Company sions. As a result, the more narrow the focus, the more and social network Nextdoor and a seat on the Kim- risk that someone will spend a lot of time pursuing

OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD | 7 The faster that things seem to move, the faster younger people aren’t young anymore. How do kids at 17 figure out that they want or don’t want to be engineers? David Wyshner, Former CFO of Avis Budget Group

a more specialized career that they don’t necessarily ing them in their careers, followed by supporting their like. It strikes me as really inefficient.” families (28%).

LOOKING BACK TO LOOK AHEAD While six in 10 executives believe their career defines Purpose-driven work is nothing new. In fact, 44% of them to a large degree (62%), if they were financially business leaders say doing meaningful work and stable enough to pursue any career path, 22% of making a difference are the leading factors motivat- business leaders said they would pursue philan-

EXHIBIT 4. GENDERS DIFFER ON THE FUTURE OF LEADERSHIP.

“Meaningful work is my primary career motivation.”

“I would ﬁnd a truly diverse workplace appealing.” 22% 9%

“I would ﬁnd a purpose-driven organization appealing.” 9% 22%

“Technical skills, like analyzing quantitative data and being proﬁcient with the latest technology, will be critical to success for future leaders.” 28% 17%

8 | OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD thropic work, while 21% would continue in their cur- vealed significant differences between genders that rent role working the same hours. Only 7% would point to a continuation of traditional gender roles. stop working entirely. For example, male business leaders were more likely The importance of purpose-driven work, both among than their female peers to value purpose-driven orga- current executives and in their hopes for future gen- nizations, with 22% saying purpose-driven organiza- erations, highlights an important differentiator for tions were most appealing versus 9% of female lead- today’s companies. Meaningful work that makes a ers. In contrast, female leaders were more likely than significant positive difference in the world is the new their male counterparts to find truly diverse organiza- competitive advantage for companies, especially tions appealing by the same margin, perhaps because when it comes to attracting, retaining and inspiring they can find more mentors and advancement oppor- future business leaders. tunities in highly diverse companies. Female leaders were also more likely to value work-life balance, as Purpose-driven or not, 58% of business leaders say the bulk of home and childcare duties often still fall to they love everything about their careers, with busi- working women over their working spouses. ness leaders 55 and older and C-suite executives even more likely to find their careers satisfying than their Traditional gender roles also persist when it comes younger or lower-ranking peers, perhaps because to motivation for working. Female business leaders they have a greater sense of control and influence. are 45% more likely to say they’re motivated by doing meaningful work, while men are 94% more likely to be Given the love many executives have for their ca- motivated by supporting their family and 150% more reers, it’s no surprise that 72% of business leaders likely to be motivated by a desire to lead people. would choose the same career path if they could do everything again. Common reasons provided for this Perhaps these traditional gender roles will begin to include the ability to contribute to an organization or change along with the other transformations these cause, continually learn and develop skills, and meet executives predict. But either way, there will be plen- interesting people. Those who would choose a differ- ty of changes coming. Today’s business leaders think ent path were split among those who thought their tomorrow’s world of work will be dominated by tech- career was too narrow, those who wished for more nology, and yet “soft” skills like problem-solving and specialization and those who just wanted to earn creativity will be prized. Even more critical, they be- more money. lieve purpose-driven work will continue to motivate THE GENDER GAP their children and grandchildren as they enter the As we look to the future, it’s important to note some workforce, giving companies a clear area of focus as things that haven’t changed much: The survey re- they look to recruit and retain the next generation.

AUTHOR Jenna Fisher leads Russell Reynolds’ Global Financial Offi- highly visible, pre-public venture capital–backed enterpris- cers, Human Resources Officers, General Counsels, Oper- es. Her expertise lies in recruiting CFOs, although she has ations and Supply Chain, and Corporate Communications conducted numerous assignments for treasurers, control- Officers Practices. With more than a decade in executive lers, internal audit executives and division chief financial of- search, her clients range from Fortune 1000 corporations ficers. Jenna is frequently cited for her expertise in leading to middle-market private equity portfolio companies and business publications, including The Wall Street Journal.

OUR FUTURE LEADERS: TODAY’S BUSINESS LEADERS REFLECT ON TOMORROW’S WORK WORLD | 9 Russell Reynolds Global Offices

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Russell Reynolds Associates is a global leader in assessment, recruitment and succession planning for boards of directors, chief executive officers and key roles within the C-suite. With more than 370 consultants in 47 offices around the world, we work closely with public, private and nonprofit organizations across all industries and regions. We help our clients build teams of transformational leaders who can meet today’s challenges and anticipate the digital, economic, environmental and political trends that are reshaping the global business environment. Find out more at www.russellreynolds.com. Follow us on Twitter: @RRAonLeadership