Organizations Struggle to Develop Future Talent, According to UNC Kenan-Flagler Study

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New research from UNC Kenan-Flagler Business School reveals challenges companies face in developing business leaders.

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New research from the University of North Carolina Kenan-Flagler Business School and the Human Capital Institute (HCI) reveals key challenges to developing business leaders and highlights the most effective methods to develop a strong talent pipeline.

The research report “How to Accelerate Leadership Development” indicates an urgent need for organizations to accelerate the development of future business leaders. As more senior leaders become eligible for retirement within the next five years, organizations report critical challenges in identifying and developing leaders to drive their businesses. According to the research, a majority of senior human resource leaders are not satisfied with their current leadership bench strength. It also reflects their serious concerns about the ability to develop leaders to fill critical positions now and meet business needs in the future.

HR leaders report that balancing long- and short-term business needs is the number one challenge to leadership development. Encouraging managers to develop their team was identified as the second most common challenge, followed by the size of the budget. Less than a quarter (23 percent) of the HR professionals surveyed report that the size of their learning and development budget is sufficient to meets their needs. Despite the budget constraint, the majority of organizations plan to increase leadership development activities within the next five years.

The five most important competencies for effective leaders were identified as ethics and integrity, drive for results, effective communication, strategic thinking/insight and relationship management. Organizations are providing a variety of opportunities for future business leaders to improve these competencies, and those that offer a broad portfolio approach report greater success in accelerating leadership development. Organizations using a variety of methods report a greater percentage of leaders who are ready to fill critical positions. In addition, organizations where leadership development efforts are fully integrated with business strategies report that developing mid-level leaders takes significantly less time.

“Businesses must provide a variety of opportunities for their leaders to develop the knowledge, skills and experience they need. Successful organizations use a variety of methods to develop leaders and they tie learning and development to the business strategy,” said Kip Kelly, director of UNC Executive Development at UNC Kenan-Flagler. “By developing a comprehensive leadership development plan to groom their top performers, employers can build a strong talent pipeline and prepare their leaders to take their businesses to the next level.”

The research report is based on a survey of nearly 400 HR and training and development professionals and was designed to uncover their current leadership development challenges and opportunities. In-depth interviews also were conducted with several experts on the topic of leadership development and best practices for improvement.

Based on the surveys and interviews, the research reveals several key findings.

  •     Need for action: Overall, 85 percent of respondents agree that there is an urgent need to accelerate the development of their leaders. A majority of senior leaders are not satisfied with their current bench strength and are concerned that their high-potentials are unable to meet future business needs. Just 40 percent report that their high-potentials can meet future business needs.
  •     Biggest challenges: Only 23 percent of respondents agree that their learning and development budgets meet their current needs. The most common challenges reported were the balance of short-term and long-term business needs, budget sizes and encouraging managers to develop their team.
  •     Signs of change: Despite the bleak landscape, the majority of organizations plan to increase leadership development activities within the next five years. The development methods expected to see the highest growth include mentoring programs, greater exposure to senior executives, and increasing attendance at industry conferences and trade shows.
  •     Key to success: The organizations in which leadership development activities are fully integrated with the business strategies report a greater percentage of leaders who are ready to fill critical roles. They also report that is takes less time to develop mid-level and senior leaders.

To read a white paper by UNC Executive Development that summarizes the report, visit For the full report, visit


About UNC Executive Development
For over 60 years, UNC Executive Development has partnered with organizations to create customized executive development programs to answer their business challenges. As a part of UNC Kenan-Flagler Business School, UNC Executive Development brings the school's experience, reputation, and noted faculty to these challenging and impactful programs. In 2014, the Financial Times ranked UNC Executive Development No. 9 in the world and No. 4 in the United States for its customized executive development programs designed to help organizations address these challenges. For more information, visit

About Human Capital Institute (HCI)
HCI is the global association for strategic talent management and new economy leadership, and a clearinghouse for best practices and new ideas. Its network of expert practitioners, Fortune 1000 and Global 2000 corporations, government agencies, global consultants and business schools contribute a stream of constantly evolving information, the best of which is organized, analyzed and shared with members through HCI communities, research, education and events. For more information, visit

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