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Leadership, in its entirety, is the interplay between the leader and the collaborators aimed at achieving specific goals that reflect their common purposes. Great leaders create a vision, exhibit influence and inspiration, build relationships, coach others, and demonstrate consistency in a wide variety of circumstances. However, some challenges characterize leadership in the new-age world. For example, organizations worldwide are experiencing transformation at a phenomenal pace. The continual and rapid changes in the business environment have underlined the need to adapt, adopt and reposition businesses to remain relevant.
It is the survival of the fittest, and organizations that brace up and align their strategies accordingly are likely to stay relevant in the long haul. Most importantly, due to this transformation, leaders must address multi-faceted demands (reduce costs but increase innovation; think globally, act locally; achieve more with less). These challenges have underscored the need for versatile leaders who are proficient in core leadership competencies and can address a wide range of challenges. These competencies are the sum and substance of effective leadership, and hence, organizations that focus on leadership competencies’ development can make the right decisions on hiring, developing, and promoting leaders.
Leadership competencies are essentially the skills, knowledge, behaviors, values, and abilities that define effective leaders. They define the standards of excellence which organizations can focus on to develop a blueprint for identifying and developing leaders for current roles and potential future roles. Hence, an organization’s steadfast focus on leadership competencies will enable its leaders to develop proficiencies that will help them lead organizations to success.
However, leadership competencies are not based on a one-size-fits-all approach, and there is no definite set of competencies that will cater to all companies and industries. That’s why organizations need to frame their own leadership competency frameworks to achieve their leadership development goals.
Aspiring leaders, managers, and executives are expected to develop their competencies in accordance with the organizational vision to become better leaders. Researchers at Mercer | Mettl have identified some crucial leadership competencies that provide a structural basis for organizations to decide areas where their leaders excel and lack. This makes selecting and developing leaders seamless based on their current skill sets and competencies they need to build for specific leadership roles.
Listed below are the various types of leadership competencies, and each one of them can support the individual to become a better leader:
Learning orientation is critical because it keeps leaders inspired, curious, and well-equipped on the developmental journey. It represents the tendency to internalize a learning mindset and seek learning opportunities. Learning-oriented leaders are open to feedback and draw on past experiences to learn from successes and failures.
The willingness and intent to continually learn and grow are crucial in the current VUCA (volatile, uncertain, complex, and ambiguous) environment, making it a critical leadership competency. Assessing and imparting learning orientation is the only way to thrive in the new business reality, where emerging technologies and trends impact business patterns. Learning orientation helps reduce complexities as leaders learn about different forces of change and the interplay that create these complexities. Adapting to evolving strategies, working on cross-functional projects and undertaking challenging situations require agile and learning-oriented leaders.
Resilience is today’s must-have competency for leaders because it determines their ability to tackle challenges and see new opportunities in those confrontations successfully. It represents the tendency to remain focused on adversities and uncertainties and handle difficult situations by managing emotions effectively.
Leaders are not tested during good times but by their performance during difficult times. Resilient leaders have the grit, courage and composure to lead their teams in challenging situations. The courage to stay put and adapt to changes is one of the most critical leadership attributes and competencies. In addition, resilience enables leaders to react calmly and inculcate a positive attitude when faced with challenges.
This core competency demonstrates a tendency to focus on team members’ professional growth and development by identifying their strengths and development areas. Those leaders who are capable of building and nurturing competent teams tend to create learning opportunities for the team members and mentor them to achieve their developmental goals.
Team members who work well together help achieve organizational goals by maximizing output and productivity. However, leaders need to develop team members to build such a team. They are expected to find the gaps, pose challenging tasks, and drive them to achieve the targets in a defined timeframe. Therefore, they can use leadership competency assessments to understand their teams’ strengths and key improvement areas.
Inclusive leadership is a vital competency that demonstrates the tendency to value diversity and inclusion to lead a team of diverse individuals successfully. In addition, it represents the tendency to build a collaborative team culture and leverage diversity to work effectively.
Leaders who value the importance of diversity and inclusion don’t let biases and preferences creep into their decision-making process. Instead, they tend to anticipate different views and perspectives to make well-informed decisions. They are expected to build an inclusive, collaborative team culture and leverage diversity to work effectively.
Developing competencies around innovation is crucial for effective leadership. It represents the tendency to approach issues differently, thinking out-of-the-box and striving for continual innovation. Innovation-oriented leaders tend to foster a culture that encourages people to innovate by experimenting and ‘failing fast’ with new ideas and sharing their learnings across the organization.
With the advent of new technologies and processes comes the need for organizations to think innovatively to stay competitive and plot their path to success. That’s why innovation-oriented leadership has taken precedence over traditional business thinking. This way, leaders can bring new ideas, approaches, and energy to foster a culture of innovation. Hence, implementing new ideas to create better processes, products or customer experiences catalyzes steady business growth.
Dealing with ambiguity is a competency rapidly pushing its way up on the list of most crucial competencies for leaders. It represents the ability to handle ambiguous or unpredictable situations comfortably. Leaders who can successfully manage ambiguity in unforeseen situations are better equipped to deal with risk and uncertainty. Besides, they know how to adapt to change and solve problems.
Navigating ambiguous situations propel leaders to use the opportunity and take calculated risks to explore new challenges and complex problems. It is a global leadership competency that businesses must incorporate in their newer leadership competency models.
Change management is the new leadership competency that shows the ability to communicate the need and the rationale for change and ensure that all stakeholders are comfortable with it. It also involves minimizing complexities or reducing their impact and smoothening the process of change.
According to PMI’s Pulse of the Profession In-Depth Report, 56% of organizations cite the lack of leadership as the primary reason for the failure of organizational change. Change facilitates leaders developing a broad strategy, followed by an action plan for its fulfillment. These initiatives are a part of the response to the change and can be mapped by the leadership competencies assessment.
A strategic mindset is among the most highly sought-after leadership competencies. It represents a tendency to think long-term, take a broader perspective and build a shared vision with others. Moreover, strategic thinkers tend to formulate strategies to achieve the organizational vision and effectively execute the plan.
A general must see alone and know alone, meaning that he must see what others do not see and understand what others do not know. Seeing what others do not see is called brilliance; knowing what others do not know is genius. Brilliant geniuses win first, meaning that they defend in such a way as to be unassailable and attack in such a way as to be irresistible.
This passage from ‘The Art of War by Sun Tzu describes how great leaders employ and embody strategic thinking to fulfill the organizational vision and mission. Strategic thinking is a crucial element of the leadership competency model. Due to their knowledge and experience, leaders’ ability to think strategically results in the team’s high-quality deliverables. Conversely, the organization risks making hasty decisions that lack creativity and are not strategic.
Networking competencies enable leaders to develop networks and alliances to build strategic relationships and effectively leverage them to achieve common goals.
Leaders can achieve several goals by establishing a robust internal network. Strong relationships with key stakeholders can enable easier approval of projects. In addition, building relationships with decision-makers in the organization develop open lines of communication that assist leaders in staying abreast of strategic changes that may impact their roles.
How effectively and quickly leaders plan is an accurate measure of their competency. It represents the ability to solve problems, make critical decisions after considering all available data and derive valid conclusions based on the evidence and logical relationships.
Great leaders know when to move quickly and proceed with the available information versus when to take more time and gather additional information.
Emotional intelligence (EI) competency is vital to successful leadership because perfect leaders know how to manage and monitor their emotions and understand others’ emotions. Leaders with high EI are self-regulated, motivated, empathic, self-aware, and friendly, which means they have the crucial ingredients to grow into superior leaders. Emotionally intelligent leaders respect and understand the intricacies of their feelings and are conscious of how these feelings can affect other individuals.
Also known as reconciliation competency, this leadership competency comes in handy at resolving workplace conflicts. Leaders who are good at managing conflicts can address and iron out conflicting interests between two or more parties in a sensitive environment where mutual distrust may prevail. In addition, leaders can instill trust, empathy, and understanding between parties by effectively managing conflicts. Conflict resolution is all about finding common ground for ideas and opinions that are poles apart.
Results-orientation is an essential competency that focuses on improved performance and timely results within the assigned budget. Failure to deliver is an uneasy feeling that can even send shivers down the spine of most people in leadership positions. That is why a balanced approach is needed. For example, leaders with excessively team-centered conceptions are less likely to push their teams to the next level. Similarly, leaders who are too concerned with the organization’s demands and goals will bring their teams on the verge of exhaustion.
Leadership is not about imposing orders. It is multifaceted, and leaders are expected to know all the facets. Good leaders understand their teams. They stand by their teams to show that they have them covered. Leaders wear many hats at work, whether it is about coaching and guiding their teams and peers, pushing someone past their comfort zone, or helping people find their calling. They also need to build and keep strong relationships with their direct reports, subordinates, and juniors.
The most critical leadership competency is authenticity. People are very well attuned to identifying an inauthentic behavior; they know it and do not respect it. People demand honest communication, and authentic leaders are aware of this fact. They step up and nurture sincere relationships with their teams and give importance to their opinions, ideas and suggestions.
Authentic leaders are more receptive to the feelings of their subordinates, encourage them to be more open and help them understand their value in ensuring organizational success. Authentic leadership is a significant predictor of an employee’s job satisfaction.
Interpersonal core competencies represent how leaders interact with their teams and how actively they listen and respond to their concerns, provide and receive feedback and what kind of non-verbal communication occurs between them. Developing strong interpersonal skills can drive high team performance and employee engagement, critical for organizational growth.
Vulnerability can be that new competency that can teach leaders to embrace their vulnerabilities as it takes courage to open yourself up to others. Most of us are conditioned to put on emotional armor when entering the workplace and never let go of that armor. Yet, it is paramount to experience vulnerability for productive workplace behaviors. Why? Because it gives us the courage to admit our mistakes or accept responsibility for poor outcomes. Those leaders who own up to their mistakes know the importance of failure in life. They tend to appreciate the innovative and “learning by doing” approach, and team members are likely to imbibe these cues from the boss.
On the other hand, if leaders never accept their mistakes and try to protect their fragile egos, team members are sure to mimic this behavior. They will also wish to keep a distance from their boss and never understand the value of healthy team dynamics, such as transparency, trust, and team spirit.
Now that we have already discussed the several types of leadership competencies, we will focus on crucial aspects of developing leadership competencies.
Developing leadership competencies is not an overnight process and demands significant efforts. Leadership is not to be learned from books only. It is about experiencing specific situations, overseeing people regularly, and addressing challenges that seem perplexing.
Wading through complexities can help leaders decide which competencies they need to develop. Some do this intuitively, without requiring external help. Others like to learn the trade trick, so they prefer taking different coaching sessions or courses.
Most importantly, leaders should address the following questions that lay the foundation for competency development:
Successful leaders always have inspirational role models to look up to. But why? They possess admirable characteristics and skills that make them worth following, and leaders can turn to them for mentoring or advice.
Learning agility is critical for becoming an effective leader. Those who keep learning new things hold the key to a sharp mind and improved skills, stay abreast of all the latest developments in their industry, and are in a better position to lead. In addition, they are primed for unforeseen challenges that may come their way, which is always desired in leaders.
Leaders should inspire their teams and inspire and motivate those they work with when collaborating across teams, functions, and departments. Besides, they must offer guidance and support to team members should the need arise. Sometimes, simply listening to others and expressing concern go a long way in establishing a genuine connection as a leader.
Active listening skills are pivotal to successful leadership because being a leader is not about garnering spotlights. Instead, active listening entails paying heed to ideas, suggestions, and feedback from others and incorporating them. Moreover, this skill is about making effective verbal communication and deciphering non-verbal cues, such as body language, eye contact, etc.
Leaders are as good as their employees, and hence their attitude will directly reflect on their teams’ performance. The success, happiness, productivity, and willingness of employees at work are dependent on how positive and passionate leaders are about their work and their people. Therefore, negative emotions and behaviors must be kept at bay, and a positive attitude and outlook must take precedence.
Influential leaders are the veritable disciples of discipline. Leadership warrants discipline. Developing a regimented plan for professional and personal commitments is crucial for leaders and managers. By showing discipline at work, leaders can inspire others to be disciplined.
Zack Blenkinsopp, owner, Digital Roofing, asserts, “Self-reflection is often the best way to practice and develop leadership competencies. It begins with fine-tuning your emotional intelligence to master impeccable communication skills that are vital to making things run smoothly and solving problems before they even become problems”.
Developing leadership competencies is not a one-off affair but a continual process that requires thorough deliberation, creating and implementing a leadership development framework. The process can be materialized using a holistic leadership model based on extensive research to help leaders identify and work on competencies and behaviors considered crucial for next-level roles.
Situational awareness is a valuable skill for leaders because the ability to foresee and devise solutions to circumvent upcoming problems is the need of the hour. Someone who can predict uncertainties and look at challenges from multiple perspectives will recognize opportunities that others may overlook, making such leaders indispensable for the organization.
Mercer| Mettl’s decade-old expertise has laid the groundwork for developing a proprietary leadership development model that offers a description of the competencies and behaviors considered integral to the development of leaders, helping them take on new challenges.
This empirically derived model is supported by a comprehensive suite of tools to assess leadership competencies, such as Mercer | Mettl Personality Map (MPM), Mercer| Mettl Personality Profiler (MPP), Virtual AC/DC, 360-Degree Feedback System, Behavioral Assessments, etc. Mercer| Mettl’s leadership assessment tools will help you generate a detailed competency profile of the leader, followed by a report and insights on how to undertake individual development plans.
In addition, Mercer|Mettl’s psychometric assessments analyze the competency gaps in leaders and provide holistic information on the development areas. We make it incredibly easy for you to leverage the power of data science and psychometrics to deliver the right leadership assessment tools for your needs.
21st-century leadership demands more tolerance for risks. However, any changes in established processes instinctively startle people. Insecurity about employment or growth in leaders may hamper their engagement and productivity levels. In such circumstances, leaders need to be agile in thinking clearly, decision-making and re-strategizing. When leaders consider minor setbacks as a learning curve, it instills their teams’ confidence to push their boundaries continually. The rapidly changing business environment requires a different leadership response approach that can be achieved with new-age key leadership competencies.
Originally published July 17 2020, Updated December 14 2021
Abhilash works with the Content Marketing team of Mercer|Mettl. He has been contributing his bit to the world of online business for some years now. Abhilash is experienced in content marketing, along with SEO. He’s fond of writing useful posts, helping people, traveling, and savoring delicacies.
A leadership assessment is a type of personality test used to identify and develop the competencies required in a good leader - decision-making, empathy, communication, inspiring others, etc. A leadership test can contribute to organizational planning initiatives, such as promotion decisions, succession planning, etc.
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