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There is a leadership shift occurring and businesses need to do to address it

What’s happening in leadership right now is really interesting. There’s a trend that we saw coming, but it is more striking than we expected and it will increasingly change the way we think about leadership and leadership development over the next five years. Put simply, there is a generational shift occurring in leadership in UK business.

What we are seeing is a “changing of the guard”. A new generation is taking over leadership positions as the baby boomers retire. For the last two decades, baby boomers have been in charge of a workforce made up of largely Generation X. This is the leadership context that we have gotten used to and that we understand. But the world is changing and this new world is going to be a challenge for leaders, leadership development, and leadership research.

A quick look at the statistics is very revealing. The average age of a FTSE 100 CEO is 52.8 while the average tenure of a chief executive is 5.5 years according to recent research undertaken by City AM. Interestingly, the end of the baby boomer generation is generally thought to be 1964 making the youngest baby boomers 52.  In other words, while baby boomers remain in charge, they are on their way out in the next couple of years. And the same thing is true of leaders throughout organisations of all kinds in the UK.

Generation X are more cynical and less committed to the organisation than baby boomers

And while baby boomers are on their way out, Generation X is taking over. But what is the difference anyway? Well, baby boomers, born after World War II, were teenagers in the 1960s. They began work in a world of free healthcare, plentiful jobs, great pensions, and cheap houses. Baby boomers are often characterised as idealistic and uncynical, and they tend to idolise leaders (if only in the sense that they think changing leaders will change everything). They made the transition from protest marches to the corporate boardroom with little difficulty.

In comparison, Generation X was born into a very different world. They missed the idealistic 1960s and were born into a world with fewer jobs, fewer possibilities, and where they were clearly in the shadow of the baby boomers. Generation X are more cynical and less committed to the organisation than baby boomers. At the same time, they are more committed to social change, less likely to idolise leaders, and are more comfortable with social diversity.

And this shift is made more complex by generational change occurring lower down in the organisation as millennials become an increasing proportion of the workforce. Millennials are the “networked generation” born from about 1990 to 2000. This generation was shaped by technology and has very different expectations in terms of communication, work patterns, and authority than either Generation X or the baby boomers.

For the last two decades, baby boomers have been in charge of a workforce made up of largely Generation X

As a result, effective leadership in UK business organisations is going to look very different over the next five years. As Generation X leaders take over from baby boomers, and as firms become more and more populated with millennials, questions about how to lead in a highly diverse, networked world where organisational members demand meaning will become increasingly pressing.

The impact of this leadership trend is something we at Imperial College Business School acknowledge as highly significant, which is why we are focusing on a research-led strategy to deal with the problems arising from this shift. Using in-house and other research, we aim to help UK firms who are struggling with this shift to understand what’s happening and how to respond to it.

In response to this challenge, the business school is redesigning leadership development on our degree programmes and offering open and tailored executive education programmes and information designed to help organisations and leaders alike adapt to this trend.

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Nelson Phillips

About Nelson Phillips

Visiting Professor
Nelson Phillips was Professor of Innovation & Strategy, Co-Director of the Centre for Responsible Leadership, and the Associate Dean of External Relations at Imperial College Business School until 2021. His research interests cut across strategy, innovation and leadership, and he has published widely for both academics and practitioners.