Executive Success: Cultural diversity breaks mould

Columnist·NZ Herald·

2 Jul, 2015 05:00 PM5 mins to read

Deloitte's Hamish Wilson says New Zealand businesses are not making the most of the skills present in the cultural melting pot. Photo / Brett Phibbs

The workforce is changing fast, but management isn’t keeping up.

Leadership is being given a makeover to cope with the demands of the future.

After questioning top-flight business heads, advisory firm Deloitte has identified six traits of successful leadership in a report commissioned by Chartered Accountants Australia and New Zealand.

Titled Fast Forward: Leading in a Brave New World of Diversity, the Deloitte report pinpoints six key traits: committed, courageous, cognisant, curious, culturally intelligent and collaborative. It identifies these as features of inclusive leaders who can succeed in an environment of increasing diversity.

While the whirlwind pace of change makes it virtually impossible to predict the future, says Deloitte, it has pinpointed underlying shifts that are having a profound impact on businesses. These include the slow transfer of financial power to Asian countries, so that by 2050 more than 20 of the world's top 50 cities, measured by GDP, are expected to be in Asia, up from eight in 2007.

The result will see Asia home to two-thirds of the world's middle class, up from one third today.

Globalisation, hyper-connectivity and digital innovation have reshaped entire industries and pushed innovation to the top of the business agenda, says Deloitte.

Into that mix add a workforce that is ethnically diverse, an ageing population and expectations of equal opportunity at work.

"These shifts will make the context for leaders much more diverse - in terms of markets, ideas and talent," says Deloitte. "To thrive if not just survive, leaders will need to think and behave differently." Deloitte New Zealand's human capital leader Hamish Wilson says businesses are wanting to break through with new ideas. "In the market that we've got at the moment, one of the great levers to pull is diversity and inclusion." Wilson says New Zealand businesses, typically led by the "male, pale and stale", are not making the most of the skills present in the cultural melting pot, particularly in Auckland.

"On top of that I'd say we're also the most diverse workforce we've ever had, oldest to youngest." And while we're more open to people with disabilities in the workforce, there is still a big gap to bridge in terms of gender equality, Wilson says.

Deloitte considers that traits of inclusive leadership don't replace the time-honoured qualities of good leaders, or introduce a new type of management, but should be "woven through" good leadership. "This will ensure leaders build their capability to create and lead their organisations into the future."

Wilson, who heads one of Deloitte's fastest growing sector groups, says layering inclusive leadership on top of good leadership is challenging.

"It's probably one of the harder things to do. It's so much easier to not be inclusive and that's why most people don't do it."

Wilson put his own team of 22 - which he says is "extremely" culturally diverse - to the diversity test. "When I actually put them into a 16-box quadrant and did their personality profiles, we filled up two boxes of the 16.

"What I've done is, I've employed a whole pile of mini-me's.

"We look different but we were all thinking and talking the same language." Although the team might get on famously, with everyone thinking the same way, there are less likely to be fresh ideas driving it to market leadership, Wilson says.

"I've gone out purposely and recruited people that look nothing like us and are much harder to manage, I'd say three times harder to manage, but I am getting much better thoughts and ideas coming, really left-field thinking from my perspective, but in actual fact it's their normal."

Although being an inclusive leader is hard work, he says it's the superior results through diversity of thought and ideas that makes it worthwhile.

The other benefit of inclusive leadership is that any company with an eye on markets in Asia needs to be on the front foot culturally.

"We always think we're speaking the same language but the little actions, even hand movements in some countries, are a nightmare," says the Taranaki born-and-bred Wilson, who admits to his own cringe-worthy moments when he was sent to the Middle East for work early in his career.

But if even the big guys struggle - global giants Unilever and Nestle have both recently reported problems gaining a foothold in China - what hope is there for companies from New Zealand?

Big or small, Wilson says it still comes back to the talent at senior levels not changing fast enough, with older, white males still dominating the ranks of company leadership.

That homophily - the love of the same - is holding companies back.

And, he says, if we still have problems with women in senior roles, how can we expect to break into markets where there are major cultural differences?