Rethinking leadership competency models for the AI age

What does a good leader look like?

There’s no single answer to this question. Every person you ask might give you an entirely new definition of what seems like good leadership to them. It happens because personal styles and experiences, company preferences, and team dynamics (to name a few) are constantly impacting how leaders perform.

Thus, most companies rely on a leadership competency model to measure leadership effectiveness, which offers a framework outlining major aspects of effective leadership. Most of the models and frameworks defining leadership have been around for ages. But the world has changed since then. In this blog post, we will look into rebuilding leadership competency models for the age of AI.

What is a leadership competency model?

A leadership competency model is a framework that outlines the skills, behaviors, and knowledge required for successful performance in a the role of a leader or a people manager. In the context of leadership in an AI-driven world, a competency model encompasses traditional leadership skills along with new competencies related to understanding and leveraging artificial intelligence technologies.

It serves as a blueprint for:

• Identifying and developing future leaders
• Evaluating current leadership performance
• Guiding leadership development programs
• Creating succession planning strategies
• Aligning leadership behaviors with organizational goals

What are the different types of competencies for leaders?

Since leadership is a diverse area with activities spanning across the board, leadership competencies are quite varied too. Primarily, we can look at three types of competencies a leader needs for success:

#1 Strategic Competencies

These relate to visioning, planning, and long-term organizational success such as developing vision and executing it. Similarly, strategic thinking and planning are competencies that a leader absolutely needs. It will also include business acumen, innovation management, and decision-making ability.

#2 Operational Competencies

The second set, operational competencies focus on day-to-day execution and efficiency. It includes skills like project management, resource allocation and process improvement. This would also include performance management, risk management, and quality control.

#3 People Management Competencies

While the first two areas were largely work related, the third ( and often overlooked) set calls attention toward the people. As a leader, it is vital to not only manage but coach and support teams. This is done with the help of skills in team building, conflict resolution, communication. In modern teams, coaching and mentoring team members, talent development, and relationship building are considered vital too.

To sum up leadership competencies:

• Strategic: Focus on “where we’re going”
• Operational: Focus on “how we’ll get there”
• People Management: Focus on “who will take us there”

What are the weaknesses of our present leadership competency models?

Leadership competency models of most organizations are not designed with the 21st century in mind. McKinsey noted in their recent research that technology is changing how we work and live every day. Further, we now have a generation of workers who were “born digital.” It means that our models defining the ideal of leadership are in for an overhaul as well.

If we look at the primary weaknesses of leadership competency models today, we can spot:

#1 Rigidity

Leadership competencies are defined on a strict yardstick that does not account for dynamic business environments. Digital-first and forever remote teams are changing the structures where the roles of leaders were defined. Plus, of late, companies have been open to recognizing that leadership competency frameworks developed in the West are not adequately replicable across cultures. The novel development and aspirations of a new generation of leaders do not find space in conventional models.

#2 Technology Gap

Before taking your organization on to a journey of digital transformation, you need to ask yourself – are your leaders ready for the digital era? And no, you cannot meet this need by adding yet another online course on digital ideas for the 21st century to their to-do list. It’s high time to recognize that there has been a significant lack of focus on developing familiarity with digital infrastructure.

With the advent of AI, we are seeing more concerns rise over job safety and redundancy. Leaders would be crucial in navigating these with your employees. Thus, it’s time to push out the outdated modes of virtual team management and unleash an era of truly digitally competent leaders.

#3 Fractional View of Competencies

What gets measured gets worked on. But how do you measure a leader’s ability to hold great one-on-one meetings with their team members, or how well do they balance assertion with aggressiveness? These are tricky questions for most L&D teams to answer, even those with years of experience backing them. The people aspect of leadership competencies often finds itself struggling due to this lack of appropriate measurement methods and limited feedback and development mechanisms. Our view of leadership is broken.

Since we are in a wave of new ideas like sustainability and digital transformation, as well as new ways of working with global and distributed teams, the leaders need to be prepared. Relying on old-school ideas puts a huge burden on them to figure out how things really work. And, of course, some of your leaders will. But that will take away precious hours and effort from them while also bogging down the rest who are sent to the field with knives to lead a gunfight.

#4 Implementation Issues

There’s a considerable gap between theory and practice when it comes to building competent leaders for your team. Different leadership roles need different sorts of support. The conflict resolution tips that work for a young manager working remotely with a team of two may or may not work for someone with two decades of work experience behind them and a team of senior ICs reporting. The issue noted in the first point, rigidity, comes home strongly when it comes to execution.

Moreover, there’s trouble in the day-to-day application of ideas based on fractional competency models. With limited guidance on what to apply where and how, leaders are left grappling for support due to insufficient integration of the competency framework with real-life.

#5 Development Gaps

Are you preparing the leaders of today? Or, tomorrow? For most companies the sad answer is, “yesterday.” Leadership competency models need to operate in the future, but most of them are updated after things have happened. If you are thinking of adding some AI related stuff to your leadership competency framework right now, take it as an alarming signal. Most such models over-emphasize on the present needs and that leaves organizations under-prepared for the next big steps.

A thoroughly defined leadership competency model could be your competitive edge, but if it is left chasing behind as time moves on, it will only pull you down. Development gaps such as this one, and limited focus on the people-facing aspect of leadership make these models weaker.

In the next step, let’s try to reimagine leadership competency models for the AI era. It’s promising to be the hottest topic and a troublesome concept to handle for L&D – what can you do to get an edge?

How to reimagine leadership competency models for the AI era?

AI is creating a big change in how leaders operate. It focuses on using data to make choices and predict trends. What does it mean for those in leadership and managerial roles? Leaders must now combine technical skills, emotional intelligence, and strategic thinking. This mix helps them use AI effectively in their decisions. The key is to utilize AI effectively in management roles rather than looking at ways to replace it. At best, AI is your buddy who makes you more effective at work. It cannot make decisions or add the human touch which makes a leader stand apart.

How should this be reflected in leadership competency models? Let’s explore:

#1 Higher focus on people skills

First, we have noted that historically leadership competency models have lacked adequate focus on the people management side of leadership. This means we need more emphasis on people skills like emotional competence and effective communication for managers. This is vital in light of the changes that are coming with increasing push for adoption of AI led systems and processes in workplaces.

We have to rethink how we value people’s capabilities and expertise… Intelligence is your ability to solve the problems confronting you with the available resources. And that’s why an intelligent person would not ignore the use of AI.

Dr. Steve Hunt, Author of Talent Tectonics (from the Risely Podcast)

So, instead of rethinking systems with AI at the pivot, let your people be at the center of everything and empower them with AI. You will find that many concerns about the applications of AI in workplaces will be resolved when you build familiarity with AI and start applying it strategically in everyday business. At the same time, focus on the human side of leaders that AI cannot replace and make them shine.

#2 Give more emphasis to emotional competence

Now that we are speaking of developing people management capabilities, emotional competence deserves its own moment. As per McKinsey’s research on what new leaders should look like, there’s a major call for reimagination. It’s not just about how work is done or who reports to whom; this reimagination is about where the leader sees themselves in the organization.

When leaders are called upon to reignite fires in organizations and wake them up from the slumber of a pandemic and economic downturns, simply motivational talks are not going to be enough. The ability to emotionally regulate themselves in the face of novel challenges, as well as support others in navigating complex emotions related to evolving workplaces, is going to be critical to success. The conversation of digital transformation and supporting people more, thus, circles back to enhancing the emotional competence of every leader on our roasters. Hold space for this conversation in your leadership competency model.

#3 Build with clarity

What does “striving for excellence” really mean? I know that it sounds like something great that every organization should achieve, but what does it really mean? Should every leader drop underperforming team members today? Do we cut out metrics we are not doing great on? These are the sort of questions that bother leaders who are handed a framework built on great ideas and little execution support.

Leadership competency models must embrace clarity soon to be helpful resources for everyone working around them. If the L&D team is creating a leadership development program, then the model must clearly show what well-rounded competence in a leadership role looks like.

Embracing clarity can become difficult for people management since it does not translate into numbers directly. That’s where tools like Risely come into the picture. With built-in assessments for core and advanced leadership and people management skills, you can track your team’s leaders and managers. And it’s not one-and-done! Risely’s assessments combine self and team reviews and benchmark against company averages, and your managers can retake them after working on the skill areas for a while to get regular and comprehensive insights.

#4 Add AI and digital fluency to your list

This one is a no-brainer. If your teams look forward to adding AI and further technical advancements to the workflow, your managers need digital literacy. Any new change in organizations works better if the managers are onboard. They are your biggest influencers when it comes to reaching out to every employee. Hence, they can be utilized effectively in building a future-ready workforce by making them take the first step.

This would include learning specifically how AI works, how it can be applied in their specific function, what safeguards they should adopt, and so on. Adding this to the leadership competency model itself will ensure that a level of digital literacy is ingrained in the system, thus creating a benchmark across the organization.

#5 Don’t forget coaching skills!

Last but not least, the changes in the workplace are not just about what work looks like but also about how it is done. That means the role of a leader is changing, too. While historically, they were expected to guide from the other side of the table; the present calls are from an involved leader down in the trenches with their team.

Coaching skills become super important in such scenarios. Managers and leaders are moving from directing people to guiding them and working with them through challenges. The bigger troubling ideas like data analysis can be handled by tech; it’s the people who need to support people better. As a result, the leadership competency models need to relook into what people management skills they are focusing on. Simply adding effective communication and conflict resolution to the list is not enough. We need to focus on enabling relationships, trust, and loyalty from employees toward their managers to create more impactful teams that move together.

A leadership competency model that can reflect on these changes and global movements is the need of the hour. We have complied these ideas into a diagram as follows:

Wrapping up

In a world that is changing fast, handling change and uncertainty with AI needs a good mix of traditional leadership skills and AI insights. Using AI helps leaders make decisions based on data, spot market changes, and quickly adjust to new situations. Building emotional intelligence along with technical skills allows leaders to motivate their teams during uncertain times. By using AI for looking ahead at trends and making predictions, leaders can guide their organizations to success, even when times are tough.