Performance and Potential The Changing Face of Leadership

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Performance and Potential The Changing Face of
Leadership

• Charles A. Barrett
• Vice-President, The Conference Board of Canada
• September 18, 2001

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The Conference Board of Canada
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5th Report
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The Conference Board Believes That.
Economic Social Systems fit together
ECONOMIC
SOCIAL
. . . our social and economic systems are
synergistic
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The Conference Board Said That . . .
By any measure of socio-economic
prosperityeconomic wealth, material possessions,
natural resources, health, education, or strong
standing in the global marketplaceCanadians are
among the richest, most comfortable people in the
world. Performance Potential 1996
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The Conference Board Also Believes That
We can not sustain what we now have unless we
change, and that actions by leaders can affect
our prospectsthis privileged position is not
guaranteed Performance Potential 1996
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Economy
Labour markets
Innovation
Health society
Environment
Education
these are the fundamental underpinnings
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Benchmarking Shows Us the Possible
Six of the Best
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Benchmarking Indicators Shows Us What is Possible

• some where we do very well, some poor so we can
  learn from others
• this is not just for countries it applies
  equally to organizations

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Performance Potential 2000The Top 40 Record

• On the Top 40 indicators compared to 6 of the
  best, we are a . . .

Top performer on 10 Average performer on 14 Poor
performer on 16
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Canadas PerformanceThe Top 40 Record

• Socio-Econ. No. of Current The Overall Top
• Categories Indtrs Performance Performer

Economy 6 Average U.S. Labour Markets
4 Top Norway Innovation 6 Poor Sweden Environment
4 Poor Sweden Education/skills 8 Average U.S. Hea
lth/society 12 Average Japan
Source The Conference Board of Canada
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CanadaThe Top 40 Record by Category

• Socio-Economic Top Average Poor
• Categories Performer Performer Performer

Economic 2 1 3 Labour 2 2 0 Innovation 1 0 5 Envi
ronment 0 2 2 Education/skills 3 1 4 Health/societ
y 2 8 2
Total Indicators 10 14 16
Source The Conference Board of Canada
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How is Canada Doing?

• Sample benchmark indicators of labour,
  education/skills and innovation

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Standardized Unemployment Rate, 2000Q1(per cent
of labour force)
Source OECD Internet release.
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Per Cent of the Population Attaining
Post-Secondary Education, 1998
Source Education at a Glance OECD Indicators,
2000.
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Unemployment Rates of University-Educated
25to29 Year-Olds in 1998
Source Education at a Glance OECD Indicators,
2000.
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Total Expenditures on RDas a Percentage of GDP
Source OECD, Main Science and Technology
Indicators.
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Researchers or University Graduates Performing
RD per 1,000 Labour Force
Source OECD, Main Science and Technology
Indicators, 1999 2.
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Boosting Your Performance Potential is About
LeadershipLeaders can choose to make a positive
difference in whether organizations prosperthey
carry much of the burden.
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Calling Leaders to Action
FIVE Areas for Improvement
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Calling Leaders to Action
Education and developing a learning culture must
be a higher priority
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CTA 1Building Learning Culture

• Firms must boost spending on training
• Ensure every youth graduates from H.S.
• Raise math and science skills
• All schools must have access to the Net
• Improve apprenticeship programs
• Enhance business to work partnerships

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Calling Leaders to Action
Focus attention on Canadas foreign investment
performance
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Calling Leaders to Action
Be more innovative
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CTA 3Boosting Innovation

• Tax policy must reward innovation
• Firms must boost RD spending
• Companies must better assess competition
• Better processes needed to assess projects
• Education must boost innovation skills

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Calling Leaders to Action
Social policy must be sustainable
4
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Calling Leaders to Action
Serious public debate about sustainability of the
health care system
5
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Canadas weakest driver . . .The need to boost
our innovation capacity is challenging old ways.
Organizations must be able to get additional
economic value from knowledge if they are to
prosper.
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Innovation is about . . .

• . . . more than RD, computers and AMTs. Its
  also about leadership, management, incentives and
  a will to change.

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Innovation is About Building a Learning
Organization by

• promoting idea generation
• supporting the idea to market process
• having values around innovation people
• building skills flexibility among workers
• organizing work as the work demands

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Key findings from CBoC Research

• Strong innovators perform better
• Most large Canadian firms innovate to some extent
• But only 2/3 innovate in all three areas
  (products, processes, organization)
• 10-12 of revenue from new products
• Not good enough

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Price of 1 of RD for Small Companies
After-tax cost is the net cost of spending 1
more on RD-related activities.The lower
thevalue of after-tax cost, the better is the
ranking of the jurisdiction in the provision of
RD benefits. These jurisdictions have
special RD tax treatment for small companies.
Source Jacek Warda, Rating RD Tax Incentives,
(Ottawa CBoC, 1999).
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Strong Innovators OutperformWeak Innovators
Global market share
Canadian market share
Employment
Profitability
Sales
Source The Conference Board of Canada.
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Strong Innovators Use More Tools for Idea
Generation
Idea generation
Business environment scanning
Use of customer info
Use of competitor info
RD
Source The Conference Board of Canada.
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Strong Innovators Use More Tools for Building
Innovation Capacity
Recruitment assignment
Organization structure
TD
Partnerships alliances
Adoption of outside tech
Source The Conference Board of Canada.
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Strong innovators Have Stronger Project
Management and Decision-making Capabilities
Project selection evaluation tools
Use of market analysis information
Cost-benefit analysis
Delegation of decision making
Involvement of all depts. From the beginning
Source The Conference Board of Canada.
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Strong Innovators Are Better at Creating an
Environment that Supports Innovation
Innovation
Change promoting
Idea friendliness
Vision development
Rewards promo policies
Source The Conference Board of Canada.
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Canada Compared to 9 Others

• Rank 1981 Rank 1997
• RD intensity 7 9
• Industry-funded RD 8 8
• Government outlays for RD 6 10
• Researchers in RD 6 8
• National patent applications 6 8
• External patent applications 8 8
• Techgy balnc of payments 6 4

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Performance Potential 1998Building a learning
culture is necessary to ensure that people can
change fast enough. Acquiring the wrong skills,
dropping out or having poor literacy skills will
serve no one well in the 21st century.
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Total Public Spending on Education per Student
aged 524 (real 1992 )
Sources The Conference Board of Canada
Statistics Canada.
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High School Dropout Rates of the Population Aged
19 to 20, Canada and Provinces, 1995 to 1998
Source Statistics Canada, Education and
Indicators in Canada, 2000.
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Document Literacy Skills(per cent by Literacy
Level 1 to 5)
Level 1,2
Level 3
Level 4, 5
Sources The Conference Board of Canada
International Adult Literacy Survey
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Reality versus Perception(per cent among Level 1
and 2)
. . . but few believe they have a problem (self
rating of job-related reading skills, low
document literacy-skilled manufacturing workers)
Sources The Conference Board of Canada
International Adult Literacy Survey.
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Reality versus Perception(per cent of Level 1
and 2)
. . . and even fewer believe that it
matters (perceived impact of reading skills on
job opportunities of poor document
literacy-skilled workers)
Sources The Conference Board of Canada
International Adult Literacy Survey
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Trying to Get and Keep Top TalentMost companies
do not even know what talents their staff
actually have . . . and the staff dont know
either.
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Companies Invest Sufficiently inIn-Company
Training (1 Do Not 10 Do)
Source The World Competitiveness Yearbook, 1998.
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Employee Training a High Priority?(1not a high
priority, 10a high priority)
Source The World Competitiveness Yearbook 2000.
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Raising the Bar

• Educational Requirements for Employment Have
  Changed

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Employment by Level of Education(Thousands of
persons)
Sources Statistics Canada.
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Employment in Sales Occupations(Thousands of
persons)
Sources Statistics Canada.
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Employment in Clerical Occupations(Thousands of
persons)
Sources Statistics Canada.
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Employment of Motor Vehicleand Transit
Drivers(Thousands of persons)
Sources Statistics Canada.
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Wanted Skilled Workers

• The Upcoming Skills Shortage

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Five-Year Average CompoundGrowth Rates in Source
Population(per cent change)
Sources Statistics Canada The Conference Board
of Canada.
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Proportion of Population Aged 65 (per cent)
Sources Statistics Canada The Conference Board
of Canada.
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Overall Labour Force Participation Rate (per cent)
Sources Statistics Canada The Conference Board
of Canada.
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Five-Year Average Compound Growth Rates in Labour
Force(per cent change)
Sources Statistics Canada The Conference Board
of Canada.
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Statistically Significant Predictorsof
Recruitment Success

• 1. Augmenting student programs
• 2. Providing a learning environment (increased
  TD expenditures)
• 3. Using anticipatory hiring practices
• 4. Seeking recruits from outside Canada
• 5. Involving employees in therecruitment process

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Report Card on Leadership

• From Leadership for Tomorrow
• Playing Catch-up with Change

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Report on Leadership, 2001 Comparison of 1999
and 2001 Results
of respondents who ranked themselves as highly
effective or strong (depending on scale)
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Report on Leadership, 2001 Comparison of 1999
and 2001 Results
of respondents who ranked themselves as highly
effective or strong (depending on scale)
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Report on Leadership, 2001Comparison of 1999 and
2001 Results
of respondents who ranked themselves as highly
effective or strong (depending on scale)
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