Study shows organizations unprepared for leadership exodus; anticipate
shortage of leaders by 2016
17% of organizations expect to lose more than 50% of current leadership
25% expect to lose more than 20% of leadership
68% have no executive team replacement strategy
Next generation of leaders likely to be at least five years younger
43% anticipating a shortage of executives by 2016
TORONTO, Nov. 22, 2011 /CNW/ - Corporate Canada and the public sector
are set for a massive exodus of senior executives over the course of
the next five years who are likely to be replaced by much younger
executives with higher salary expectations.
According to a Leger Marketing report commissioned released today by
executive search firm Odgers Berndtson, 17 per cent of Canadian
companies expect to lose more than 50 per cent of their senior
executives by 2016 and one in four expects to lose more than 20 per
cent. The outgoing executives, who are predominantly between the ages
of 40 and 54, will be replaced by a younger cohort that ranges in age
from 35 to 49.
More than half (53 per cent) of companies anticipating a wave of younger
executives say they will be forced to pay higher salary demands
generated by a shrinking pool of executive talent.
"The next five years are likely to bring a series of watershed moments
for Canadian companies," said Carl Lovas, Canadian Chair of Odgers
Berndtson. "Most companies have not adequately planned for the exit of
its senior staff and are now realizing it will be very difficult to
find comparable replacements. While some organizations may be
successful in filling the power vacuum with an interim leadership team,
others may be facing a break in business continuity and ultimately
Almost half of Canadian companies (43 per cent) admit they are likely to
experience a shortage of executives within their organization over the
course of the next five to 10 years. One in three of these departing
executives have been with their current company for more than 10 years
and hold strong insight on company processes, culture and future plans.
While half of companies (52 per cent) acknowledge that finding
candidates that are a good cultural fit for their organization is one
of their top three criteria, 68 per cent say they have no succession
plan in place.
"Given the importance of "fit" as a criteria — in other words, someone
who naturally fits well with the corporate culture and organizational
strategies — many companies will be looking inward to help fill senior
ranks. But the lack of planning is troubling," said Mr. Lovas. "Now
more than ever, organizations need to be preparing to compete in order
to retain and attract the right talent."
According to the research report, more than 30 per cent of managers are
being groomed for a leadership position in 28 per cent of the
organizations polled. Leadership development includes external
education, mentoring, assessment and individual coaching.
Executives in the healthcare and public sectors tend to be significantly
older than their private sector counterparts. Only eight per cent of
private sector executives are between the ages of 55 and 59 compared
with 33% and 20% in healthcare and the public sector respectively
Ontario executives are more likely to stay with a company for three to
five years compared to executives out west (27% in Ontario vs. 13% in
B.C. and Alberta)
Organizations situated in Atlantic Canada are the least likely in the
country to have a succession plan in place (90%)
92% of organizations in the Prairies feel they are unprepared to handle
the anticipated skill shortage, a stark contrast to B.C. where only 43%
feel they are unprepared
Quebec organizations are the least likely in Canada to say a portion of
their management team is being groomed for leadership positions
Organizations operating in the healthcare sector are two-times more
likely than private sector companies to have management undergo
leadership training (46% vs. 25%)
82% of executives in Quebec say they will have difficulty filling
leadership ranks due to a shortage of talent compared with 51% in B.C.
and 48% in Ontario
The Leger Marketing survey was conducted online using a random sampling
of 2,400 senior executives from Odgers Berndtson's network across the
country. A total of 287 participated in the survey. Respondents
included senior people from the private, public and healthcare sectors.
The study has a margin of error of +/- 5.8%, 19 times out of 20.
About Odgers Berndtson
The largest executive search firm in Canada and a leading global firm in
our industry, Odgers Berndtson specializes in building world-class
leadership teams. The firm offers an in-depth approach to the
complexities of the search process and its commitment to client service
is unparalleled. In fact, more than 90% of Odgers Berndtson clients
say they are "very satisfied or exceptionally well satisfied" with the
service they received. With more than 50 offices in 28 countries, the
firm's global partnership is designed for recruiting top
talent. Locally-based consultants apply the knowledge they have gained
working in a variety of sectors to generate the right leadership
solutions for clients. Odgers Berndtson also offers Interim management
and leadership assessment services.
SOURCE Odgers Berndtson
For further information:
Natali Tofiloski, APEX Public Relations, 416-924-4442 / email@example.com and Dan Ovsey at 416-924-4442 ext . 239 / firstname.lastname@example.org