Why FMCG is losing leadership skills

Posted on Thu, Sep 21st, 2017

We may be recovering from the recent economic and financial crisis, but that does not mean we are entering calmer waters. Turbulence ahead is the message, as a raft of new technologies continues to transform the shape of the economy, the workforce, and consequently organizations. Companies need to plan ahead to understand the new skills and job implications.

The way high performing organisations operate today is radically different from how they operated ten years ago. Companies need to adapt to the ever increasing demands being placed on them by the economy and consumers in this digital age.

Many organisation have failed to break down old, industrial age models, which are so heavily ingrained with legacy structures, practices, systems and behaviours. The need to develop new models which are industry specific is critical in achieving the flexibility within an organisation which is required for the future of work.

Increasingly, companies are beginning to realise that skills previously required for the success of their company are becoming obsolete and are beginning to make adjustments and additions to remain competitive. Talent is a “hot topic” for businesses and organisations across all industries and there is a definite trend seen in the demand for leadership recruitment with companies seeking to secure specific skill sets in leaders. What we have seen is that businesses in other industries are looking to FMCG for transferable skills and FMCG is paying the price.

Examples of transferable skills within the FMCG sector can be seen where companies are turning to the FMCG sector to recruit senior leaders with expertise in account management to enable them to seriously commit to improving customer focus. Another example is Strategic ability. The ability to continuously adjust and adapt strategic direction in core business, as a function of strategic ambitions and changing circumstances, and create not just new product and services, but also new business models and innovative ways to create value for a company across all sectors.

Another example can be found in leadership skills which encourage inclusivity and a great understanding of human behavior. People have a variety of needs. Irrespective of one’s status, age, and achievements, one would still have some unfulfilled needs. In order to satisfy their unfulfilled needs more effectively, leaders that possess this type of skill tend to organize the workforce into groups. The process of organizing facilitates an organization in its specialization efforts. It helps the employees to develop specialized skills and enhances the productivity and efficient functioning of the organization. The organizational system consists of social, technical and economic elements which coordinate human and material resources to achieve various organizational objectives.

Adaptive thinking is another new skill set that has become increasingly relevant to organisational change. The ability to respond to a unique unexpected circumstance of the moment is crucial due to the unpredictability of the market and will become an exceptional skill to possess in the next decade.

So why is FMCG losing leadership skills?

When comparing the operational models in FMCG compared to other industries, particularly Telecommunications we will notice that TELCOs have advanced at a far more rapid pace than FMCG. Due to tough competition in most major markets, in order for incumbent TELCOs to survive they have had no choice but to reinvent themselves. It has called for a rebuilding of their operational model. The implications for the organisation, for its IT infrastructure, and most of all for its employees are profound. Although a “big bang approach may not be the best one, we are seeing TELCOs beginning to establish a new governance model based on a new flexible framework which enables them to adjust its strategic focus as required in a fast changing industry, which makes it easier to get started on an urgent transformation.

FMCG however has had the luxury of not necessarily having to innovate to survive. However having said that, with the rise of Blockchain and Bitcoin and a complete overhaul of traditional retail, FMCG has been forced to develop new ways of running their organisations which allow for agile thinking within leadership and the workplace as a whole.

It is crucial that skills which enable the generation of practices, processes and projects which facilitate this are developed within the FMCG sector. Attracting and retaining talent, both new and old, in the traditional FMCG space will remain a challenge as youth by nature are attracted to the excitement of constant change and the need for instant gratification. However, having said this, FMCG organisations who are committed to the their future competitiveness, who understand and actively adopt changing consumer characteristics, can lead by attracting and developing a model to bring young leaders into the challenge of revitalising a traditional operating environment.

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