Recruitment & HR Development

What is the Way to Develop Next Generation Leaders that is used worldwide?

With a declining birthrate and an ageing population, there is a growing labour shortage, and competition for recruiting talented young employees is intensifying. Many Japanese companies that are expanding into the world may find it difficult to recruit, select, and foster people who can be active overseas.

In this article, we will consider the human resource issues of companies looking to expand their business overseas, as well as the hunt for the next generation of leaders that can be successful worldwide and how to develop them.

The current human resources shortage that many companies are keenly aware of

Since the middle of 2010, the employment situation has improved substantially due to the rising labour demand accompanying the economic recovery, while labour shortages, particularly among small and medium-sized companies, have intensified. The Cabinet Office  recognises that the labour shortage has reached the level of the bubble economy. It is also said that this shortage is particularly severe in non-manufacturing industries such as the transportation and postal services, various service industries, medical care and welfare, amongst others.

From the perspective of Japanese companies operating overseas, the inward-looking tendency of young people is a particular point of concern. According to a survey conducted by the Cabinet Office in 2013, only 24.3% of men and women between the ages of 13 and 29 indicated that they had international perspectives, which is the lowest among the seven countries surveyed. According to an OECD survey, the number of Japanese studying abroad has also been on a downward trend from the late 1990s to the 2000s, suggesting that the inward-looking tendency of the Japanese is becoming stronger.

Based on the above, it can be inferred that the issue for companies trying to expand their sales in the global market includes the difficulty of finding and developing human resources capable of flourishing around the world.

Next Generation Leaders Needed to Succeed Overseas

Successful overseas expansion requires "next generation leaders" that have motivational, physical, leadership, and communication skills.

Overseas expansion can be divided into three stages: the entry stage, the independence stage, and the mature stage. At first, it is necessary to start up and expand local branch offices, and the representative dispatched from the head office will lead the stabilisation of the local branch office and the acquisition of new customers. After that, the office will gradually become more independent and operations will be transferred to the local staff, while the role of the head office will shift towards the support and audit side of things.

Based on these three stages, strong leadership is required for successful overseas expansion. But that is not enough. The next generation leaders will first need to act alone to stabilise the new office, while at the same time work to develop human resources through communication with local staff, and display the ability to manage by delegating tasks little by little.

The ideal image of the Next Generation Leader 

Next generation leaders who will succeed in advancing overseas are required to have various abilities and characteristics. For example:

・Flexible learning and curiosity (adventurous)
・Communication skills and trustworthiness
・Management of diverse human resources and human resource development skills
・Respect and understanding of people from different cultures and different values
・PDCA skills and information collection capabilities

What is noteworthy is the characteristic of "Respect and understand people from different cultures and different values". Not only is it necessary to have a high level of PDCA skills and the ability to gather information, it is also necessary to have language proficiency and communication skills to understand local staff from different cultures and backgrounds.

Key Points for Developing Next Generation Leaders

To foster the next generation leaders, we must first clarify the qualities and attributes that we expect from them. A useful HR Evaluation System known as the Competency Evaluation extracts the common characteristics of excellent employees and sets employees’ evaluation standards with it so that it can be used to foster the next generation of leaders.

The best thing to do is to customise and verbalise the desired image of the next generation leaders as described above to suit your situation and use it to show young employees, the candidates for next genation leaders, exactly what kind of actions will be evaluated. This will enable young employees to raise their skills and further their careers under clear guidelines.

After clarifying the image of the next generation leaders, formulate trainings and OJTs to achieve this goal. Many companies that have expanded their business overseas are engaged in English education, cross-cultural communication skills education, and global leadership training for Japanese staff. It would be a good idea to focus on these measures and consider training programs and OJTs to help trainees acquire the skills they need as leaders.

Share the image of "Next Generation Leaders" that the company seeks with young employees

Planning is required in order to foster young employees, who are said to be inward-looking in comparison with the older generation, as next generation leaders. It is necessary to clarify their objectives, making them aware of their shortcomings in comparison with the requirements, and continue training, self-studying, and increasing their work experience to fill the gaps. Before lamenting that "Young people don't develop", it is necessary to consider whether the company has a clear image of the leader it is seeking, whether it is shared among young people, and whether the development plan is an appropriate one.
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