Immersive Simulation: Why Enterprises Need Leadership Development Solutions
Leadership is evolving as the macroeconomic and social environment changes. Leaders need to be open-minded, to both upskill themselves and to develop leadership potential in their organization as a way to address the growing shortage of leaders. This is paving the way for leadership development solutions such as immersive learning that are considered apt for both upskilling and development of leadership values and perspectives.
Leadership development solutions are increasingly in the limelight as leadership acquires an interesting perspective. Impactful leadership today calls for leaders to be driven by openness, given the unprecedented developments in the current business environment.
Leadership development has emerged as a priority for organizations, just as the requirement for existing top executives and leaders to upskill themselves has also increased. Globally, according to Training Industry, organizations spent about $3.5 billion related to leadership development solutions and program vendors in 2019, whereas expenditure on corporate training totaled nearly $370 billion during the year.
Is this focus on leadership development due to a shortage of leaders, or is it because of the challenges confronting leadership?
A little bit of both.
According to the US Bureau of Labor Statistics, the employment of top executives is projected to grow 8% over 2020-30, with about 247,100 openings forecasted (for top executives) each year, on average. Many of these are likely to be attributable to vacancies following either transfer to other occupations or exit post-retirement.
Yet another recent survey shows that more than 75% companies believe leadership is lacking, with nearly 10,000 baby boomers retiring each day. This is leading businesses to focus on developing leaders across levels, specifically against the backdrop of inefficient succession planning and ineffective upscaling to leadership roles. With close to 50% believing there will be a shortage of leadership or executive-level skills, developing the next generation of leaders has emerged as the top concern for top executives. Hence, the relevance of leadership development solutions.
What are the challenges in leadership today that have made leadership development solutions important?
As per The Conference Board’s 2022 survey of CEOs, the top leadership is fighting a battle on two fronts. Externally, the concerns include continued challenges posed by Covid-19, growing inflation, shortage of labor, disruption in supply chain and changing consumer behavior or preferences. For leadership based in the US, especially, labor shortage and cybersecurity pose a bigger concern. Internally, the concerns include focusing on attracting and retaining talent, speeding up digital transformation, improving cash flow, developing the next generation of leaders and modifying their business models.
What’s new about these challenges in leadership?
A radical shift in priorities compared to the last 15 years indicative of an “enduring change in the mindset of CEOs” – that’s what Gartner’s survey on the key issues for the C-suite in 2022-23 establishes. With the top leadership focusing on “people, purpose, prices and productivity”, it reflects the growing significance of workforce issues, such as talent retention, hiring and diversity, equity and inclusion (DEI); and environmental issues in the list of priorities of the top executives.
Quite clearly, addressing these concerns requires the leadership to evolve from being the loudest voice in the room to delivering measurable impact around the new parameters of changing demographics and requirements of the workforce, and other socio-economic metrics such as sustainability. In the backdrop of DEI trends and change in social attitude following the pandemic, workforce dynamics have changed considerably, compounding the challenges in leadership. For top executives and senior leadership, attracting and retaining talent is the prime concern, with 15% of senior executives, up from 8% last year, citing it as one of their top-three challenges. Moreover, leaders themselves need to build better skills to boost performance along the new metrics, enhance employee engagement and build strong relationships. These are among the key factors driving growth in leadership development solutions.
Yet another factor is the growing social remoteness of the Gen Z or millennial population, especially with the rise of gigs and remote working. While this section may have aspirations for leadership roles, they could be lacking in attributes, especially soft skills, which are easier to inculcate in a professional office environment due to the constant interaction and communication that happens in such a setup by default.
Where does immersive learning figure in addressing challenges in leadership?
Going by statistics, leadership development is no longer an option. Given the rapid pace of digitalization, leaders and top executives need to be flexible, adapt to changes and upskill themselves, and invest in developing leaders (in other words, adapt innovative leadership development solutions). Also, the nature of leadership has evolved with soft skills gaining prominence over hard skills. More than 50% of leaders believe that soft skills are more important. These typically include:
- Emotional Intelligence – Empathy/the capacity to listen over speaking
- Conflict and Team Management
- Employee Empowerment/Coaching
- Change Management
Considering the challenges in leadership facing top executives today and given the need to build leaders as part of leadership development goals, what can be better than leadership development solutions and programs that have been designed keeping in mind the latest trends, such as the dynamics of the modern office or workplace; the disposition of present-day employees, especially millennials who are both tech-savvy and data-oriented; the requirement for internal mobility and accessibility; and the growing importance of soft skills in an increasingly automated environment. To put it simply, leaders and top executives need to focus on modernizing learning and development to build the new work culture as part of their leadership development goals.
Enter Immersive Simulation and Immersive Learning.
Immersive simulation entails visually reproducing scenarios and places conducive to leadership training with the help of immersive learning technologies such as VR and AR as part of innovative leadership development solutions. The objective is to provide on-the-job learning experience to an individual via immersive and interactive simulations.
So, how does it help your organization?
Creates an immersive and “safe” environment: This is especially relevant, given the growth in remote working and the requirement to train without having to travel to office.
For any learning to be impactful, the learner needs to be immersed in the context. Extended reality does just that – it creates a realistic situation and a seamless context. Elimination of external stress-causing factors from the environment enables the participant to focus better. They are free to experiment and test their skills, all in a risk-free environment. They can engage freely as if they are interacting with other people in a real-world professional environment. So, while actually not engaging with people, learners get to deal with complex situations and work on their responses.
As part of VR and AR functionality, eye, head movement or speech of participants during training sessions can be monitored. Based on this, their reactions to common workplace scenarios can be assessed and accordingly they can be given feedback.
In imparting soft-skills: VR and AR, as part of leadership development solutions, are increasingly being used in conducting training on soft skills. In a Perkins Coie AR/VR survey for 2019, respondents cited AR has highly impactful in workforce development.
Learners get trained in empathy, conflict management, and mentorship. With the help of voice and body recognition, simulation can be animated better, or to tailor interactions. Given VR’s potential in the interpersonal space and the importance of soft skills in leadership training, senior leadership is increasingly turning to technology for developing leaders.
In upskilling leadership – in decision-making: AI and visualization combined have paved the way for immersive learning analytics. These leadership development solutions create virtual and augmented immersive environments. With the help of interaction and display technologies, the user immerses himself in data, which facilitates collaboration and helps in effective analysis and decision-making.
Offers cost-benefits: Immersive simulation techniques are not just effective leadership development solutions; they also lower the cost of training, decrease the time taken in training, boost engagement, and increase accessibility. According to an article by Forbes in 2019, VR could reduce training time by 40%, alongside enhancing performance by 70%. Walmart, for instance, recorded 30% higher training satisfaction for VR training programs compared to other training materials and methods.
In confidence-building: Learning through experience increases confidence in learners, besides improving their skills. As per a study by PwC in 2020, VR learners were four times faster to train.
Is relatable for the new workforce demographics: Immersive learning and simulation techniques appeal to millennials that constitute the largest section of the workforce today. It is also a highly effective way to develop them for leadership roles, especially in the light of their lack of social connect as understood conventionally. Growing up using technology, this demographic understands and relates to these techniques and appreciates such leadership development solutions.
Point to ponder for top executives
Is immersive simulation then the only apt method, as a part of leadership development solutions, for executive leadership training and development? Perhaps no. Reason is that while it is highly effective for soft skill training, such as in gender or racial bias prevention, and even for some hard skills, training and development needs to involve humans as much as it needs to be human-centered. Costs are also another factor to consider – not all companies may have the wherewithal to invest in these technologies. The right way forward would then be to have a mix and match approach. As per the individual leadership development goals of your organization and your workforce, mission and vision, you adopt a module combining the elements of conventional training and immersive learning and simulation. This would help top executives in addressing the challenges in leadership.
Given the market environment today, adopting incisive leadership development solutions and developing the right pipeline of leadership is perhaps the most pressing issue for leaders, top executives and management across organizations.
A key factor is that leadership today has evolved from what it was in the past, with focus shifting from position to inclusion. Leaders today have moved on from leading through their intelligence and job role or title to a module that hinges on experimentation and empowerment of people. This is the era of new-age leaders. And in the new era, challenges in leadership too have changed.
Moreover, organizational structure is transforming rapidly from being hierarchical to being flatter, where leadership is innate to performance and growth. It has become more of a skill that needs to be passed on – that can be passed on. Furthermore, there is a greater need than ever to be connected equally to all the stakeholders, from employees to customers to investors, everyone alike. Plus, the external environment too is in a flux, with disruption in technology and other changes happening at a fast pace.
The other factor compounding the issue is time – the need to gain skills as early as possible. For top executives and existing leaders, it is important to not just upskill themselves but also have a succession plan in place, at all times.
Hence the cause for immersive simulation as a revolutionizing change for action-oriented, practical, reality-based immersive learning.
Extended reality, as a part of innovative leadership development solutions, is, therefore, here to stay. What’s unfolded cannot be rolled back. The need of the hour, therefore, is to acclimatize, to re-think and re-strategize if your organization truly believes in building a strong, impactful and lasting leadership.