Evolving leadership in an AI-driven workplace

As AI increasingly integrates into the workforce, the "human element" in leadership becomes not just important, but paramount. While AI can handle tasks and data, it's the uniquely human qualities that will guide organizations through this new landscape.

• Navigating uncertainty with empathy: Leaders are struggling to chart a clear path amidst market volatility, the lingering effects of the pandemic, and a perceived loss of human connection. In this environment, a focus on efficiency and productivity through AI can paradoxically create fear, anxiety, and job insecurity among employees. Leaders must counteract this by demonstrating empathy, understanding these concerns, and connecting the organization's vision to a clear purpose that excites people.
• The "how" of leadership: How leaders lead is as crucial as what they do. Key qualities identified include empathy, resilience, humility, and curiosity. While these traits might have been perceived as weaknesses in traditional, directive leadership styles, they are now seen as essential for fostering trust and engagement.
• Relational leadership and employee voice: It is important to bring the employee’s voice to the forefront, co-creating the journey of AI adoption, and empowering staff. Leaders need to rethink norms, challenge existing processes, and foster a culture of adaptability where employees feel excited about innovation and problem-solving, rather than threatened by the changes brought by new technology.
• Distinction between leaders and managers: A critical point was the differentiation between managers and leaders. Managers are vital for operationalizing vision, driving execution, and managing the interplay between human and AI elements in the workforce. Their skills will evolve to include influencing, decision-making, and problem-solving in this hybrid environment. True leaders, however, are those who provide clarity of purpose and vision, role-model empathetic behavior, and champion the organizational culture, focusing on the relational aspects of the business. The "micro signals" a manager sends (like taking a sick day) can significantly impact employee well-being and help them feel comfortable in their role.

“We measure leadership effectiveness in many different ways. The trust element is what we look at the most. Can they guide the organization to think differently and take risks and be curious?” Multinational fragrance company CHRO

There is a collective struggle with the relentless pace of change and the challenge of communicating it effectively without causing "change fatigue" or anxiety.

• Beyond "transformation fatigue": The term "transformation" itself can induce anxiety, leading one business to forbid its use. This highlights a broader issue: Organizations often communicate both monumental shifts and everyday adjustments with the same intensity, overwhelming employees. The goal is to foster a culture where evolution and adaptation are seen as continuous, rather than a series of disruptive "transformations."
• The power of communication and storytelling: One CHRO emphasized communication and storytelling in leadership development. Leaders need to be equipped to articulate changes in a way that inspires and provides context. Another shared her company's approach of providing prescriptive talking points for leaders on significant changes (like a return-to-office policy), recognizing that leaders are busy and may need direct support in crafting their messages.
• Learning from experience and vulnerability: One CHRO l introduced the concept of “hindsighting” workshops, where functional groups review past changes to identify successes and areas for improvement. This practical approach helps leaders learn from real-life scenarios. Additionally, fostering vulnerability among leaders—encouraging them to openly acknowledge their struggles with change and adaptability—can prevent concerns from being silenced and lead to more productive discussions.
• Strategic pauses and language: Another CHRO suggested implementing a "pause" mechanism before communicating any change. This allows leaders to consider whether the change is truly significant or an “everyday” adjustment, identify stakeholders, and think beyond mere communication to a more comprehensive change management approach. The language used is also crucial. Framing updates as "improving a policy" rather than "transforming" can reduce perceived burden. Her experience with her CEO's transparent and candid communication style demonstrated how clear context-setting can help people understand and accept difficult decisions.

“Context setting is important in a world where we’re making tough decisions. People will understand decisions if you give them context.” Multinational pharmaceutical company CHRO

A significant theme in the conversation was the difficulty in effectively assessing and developing the crucial “soft skills” needed for future leaders, and the need to move beyond traditional, often biased, evaluation methods.

• Redefining managerial roles and capabilities: One CHRO shared a "back to basics" approach at their company, where they redefined the manager role, significantly reduced the number of managers, increased their scope, and implemented mandatory development programs for all remaining managers. This ensures that those in managerial positions are truly equipped to lead and bring out the best in their teams, addressing a common issue where basic capabilities, like giving feedback, have been lost.
• Beyond traditional ratings and "potential": Many organizations are moving away from traditional performance ratings, recognizing their limitations and potential for bias. The company of one CHRO removed ratings, focusing instead on qualitative feedback that highlights strengths and areas for greater impact. They also consciously avoided the term "potential" in succession planning, as it's often fraught with bias, instead asking questions like "Would I promote this person today?" or "Can I depend on them beyond their current scope?"

Many CHROs discussed innovative assessment tools, such as:

• 360-degree feedback: One company successfully implemented 360-degree feedback where peers are required to identify specific strengths and growth areas from a set of leadership competencies, providing more concrete and less "generous" feedback than self-assessments.
• AI for "durable human skills": Another company is experimenting with AI-powered tools to measure "durable human skills" like resilience and agility in potential candidates. This involves analyzing external data such as successful career jumps across sectors or experience in companies during major crises, to identify individuals who thrive in dynamic environments.
• Data-driven "signals": One leader suggested looking for "signals" in data to assess leadership effectiveness, such as the number of transformations a leader's team has navigated, employee willingness to take sick days under their leadership, or even commute times as an indicator of employee well-being.
• AI for feedback quality: Another leader described a "draconian" but effective approach using Agentic AI to evaluate the robustness of performance commentary entered by managers in their development system. This provides direct feedback to managers on the quality of their input, ensuring more meaningful discussions with employees.
• The challenge of implementation: Despite these innovations, the overarching challenge remains: Ensuring managers have conversations and provide feedback. As one leader noted, systems and metrics are only effective if they drive real human interaction and ensure employees understand where they stand.

“People will show up with tech skills. But given the pace of change, change is ubiquitous. We’re going to have to find people whose core skill is adapting. And being resilient through constant change.” Multinational tobacco company CHRO