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What Are The Most Important Leadership Competencies In 2023?

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Between the pandemic, inflation, broken supply chains, political turmoil, digital transformation, and financial instability, employees and leaders are under immense pressure and stress at work and home.

The heightened levels of uncertainty and change have given rise in 2023 to the need for a different kind of leader. While business-centered leadership and related competencies, such as strategic thinking and financial understanding, will always be essential, human-centered leadership skills are rising to the top of the list of the most important leadership competencies needed to succeed today.

Regardless of whether you call it human-centered or employee-centric leadership, according to Josh Bersin, both terms refer to “Leaders who understand what makes people thrive, what drives creativity and problem-solving in the company, and how they can support people during times of change, stress, or disruption.”

What do these human-centered leadership competencies look like at work? Here are the 8 most important leadership competencies supervisors, managers, and senior leaders need to motivate, inspire, and connect with their people.

  1. Inspirational leadership communication
  2. Creating psychological safety
  3. Fostering connections and trusting relationships
  4. Coaching and developing employees
  5. Granting autonomy through delegation and accountability
  6. Adopting a growth mindset
  7. Being resilient and courageous
  8. Demonstrating self-awareness

8 Leadership Competencies You Need to Succeed In 2023

 

Inspirational Leadership Communication

In times when everything seems to be in flux, leveraging inspirational leadership communication where leaders bring purpose to work, reiterate the vision, and mobilize individuals to move past the chaos to take action is exactly what employees need. Developing competencies in storytelling and delivering inspiring and clear messages should be a central focus in 2023.

 

Do you know what your leadership style is? If not, take this quiz to find out!

 

Creating Psychological Safety

Amy Edmonds, the pioneer of the concept of psychological safety, defines it as “a belief that one will not be punished or humiliated for speaking up with ideas, questions, concerns or mistakes, and that the team is safe for interpersonal risk-taking.” In teams with psychological safety, these groups are more creative and innovative, find solutions quickly, appreciate diversity and unique perspectives, and embrace change. These are all qualities teams need in the reality we currently face.

However, despite the importance of psychological safety, a McKinsey Global Survey conducted in 2021 found that only a handful of leaders demonstrate the behaviors needed to create this type of environment.

The good news is that there is a direct correlation between investing in leadership competency development and psychological safety. McKinsey found that employees who agree that their company invests in leadership development are likelier to agree that their team leaders frequently demonstrate consultative, supportive, and challenging leadership behaviors. Moreover, those leaders are 64% more likely to be rated as inclusive by their employees, making the cases even stronger for developing this key leadership competency in 2023.

 

 

Fostering Connections and Trusting Relationships

Creating connections and building trusting relationships with employees should be the ultimate goal for leaders. For example, a 2022 study revealed, "When we analyzed data from more than 113,000 leaders to find the top behavior that helps effective leaders balance results with their concern for team members, the number one behavior that helped was trust. When direct reports trusted their leader, they also assumed that the manager cared about them and was concerned about their wellbeing.”

So what can leaders do to build connections and trust? An HBR article looked at this by analyzing over 87,000 360-degree reviews of leaders. In doing so, they uncovered three commonalities of the behaviors and competencies of leaders who are trusted by their direct reports.

  1. Positive Relationships: Trust was directly correlated to how well a leader could foster connections and positive relationships with their people. The leaders with the highest levels of trust had the skills and competencies to balance results with caring for the wellbeing of their direct reports, frequently touching base on employees' issues and concerns, promoting collaboration and cooperation, resolving conflict, and delivering constructive feedback.

  2. Sound Judgment and Expertise: Unsurprisingly, leaders who generated high levels of trust with their people were also seen to demonstrate sound judgment and expertise. In practice, people perceive these leaders to make good decisions, seek them out for their ideas and opinions, are seen as thought leaders for their depth of knowledge and expertise, and can respond quickly to problems.

  3. Consistency: Leading by example and doing what they say they will do were behaviors in which employees rate their leaders high in trust. At work, these leaders are seen to be role models who set a good example where their actions speak louder than their words, always hold their commitments and kept promises, and are willing to get their hands dirty and go above and beyond no matter the situation.

 

 

Coaching and Developing Employees

Human-centered leaders can be distilled down to simply leaders that put their employees first. Therefore, leaders who show their commitment to employees by investing time and energy into coaching demonstrate their care and desire to put them first. In addition, in times of disruptive change that we’re facing, a leader who can coach their people through it is invaluable.

Despite the need for leaders to be coaches, most leaders are not equipped with the competencies to do so. One study had leaders assess their coaching effectiveness, and then these assessments were paired against what their direct reports said. 24% of leaders significantly overestimated their coaching abilities, rating themselves above average, while their people ranked them in the bottom third of the group.

To ensure leaders are actually great coaches for their people, they need the opportunity to build their knowledge and skills on how to coach and develop their people, which can be acquired through training.

 

 

Granting Autonomy Through Delegation and Accountability

Employees want autonomy and ownership over their work. Gone are the days when they will accept a leader who uses a command and control style of leadership. To be a human-centered leader in 2023 who puts their employees' needs first, leaders must have the competencies to lead in an environment that allows for independence.

The way to build an environment that is successful and isn’t free for all is through delegation and accountability. Autonomy will not be successful without them. Delegation is the act of assigning someone a project, task, or duty, while accountability is when an employee makes a promise, follows through, and takes responsibility for their actions. You can’t have one without the other.

Therefore, building leadership attributes and competencies where leaders understand how to recognize what and how to delegate tasks and how to gain commitment from their employees to fulfilling those accountabilities is essential for granting autonomy and leading in 2023.

 

 

Adopting a Growth Mindset

Leaders with a growth mindset can adapt to change, which is critical in an environment of uncertainty. A growth mindset simply is the belief that one can develop, learn, and grow, which is essential for embracing change and striving for continuous improvement. In addition, this mindset enables them to step up to new leadership challenges and work through setbacks and obstacles, all of which are necessary for leading employees in 2023.

 

 

Being Resilient and Courageous

Employees want leaders who do not fold under pressure and stress. They need someone they can follow who can come back stronger from setbacks, manages stress, and resolves conflict positively. They need a leader who is courageous despite all the uncertainty they face. Developing the leadership competencies of resilience and courage while navigating VUCA (volatility, uncertainty, complexity, and ambiguity) should be a must-do in 2023.

 

 

Demonstrating Self-Awareness

Self-awareness is central to human-centered leadership and leading a team in 2023. These leaders understand their strengths and shortcomings, where authenticity is paramount to everything they do. According to the Bersin Academy, there are three central tenets to human-centered leadership.

  1. Empathy: These leaders are self-aware of their own biases and privileges, enabling them to listen and demonstrate compassion for others’ perspectives and life circumstances. They’re able to show care and concern for their people and understand life can get in the way of work.

  2. Vulnerability: Self-aware leaders do not fear being vulnerable in front of their people. They take the time to self-reflect on their leadership, admit when they’re wrong, and regularly seek feedback from their team.

  3. Humility: Humility and a growth mindset go hand in hand. When leaders are self-aware of their knowledge and skills, they always assume there is more to learn. Therefore, these leaders prioritize their development and encourage their people to do the same.

Do You Know Your Leadership Style? Take This Quiz and Find Out Now