The Talent500 Blog
4 key leadership trends for companies in 2023 1

4 key leadership trends for companies in 2023

The current workplace landscape is still very uncertain, but one thing is clear – we are never going back to what was considered normal. The pandemic caused companies to fundamentally change many aspects of how they work. While some leaders are choosing to embrace the change and are inspired to find ways to succeed, others find themselves in slightly more difficult territory. They are feeling the pressure to change how they think; their perceptions and expectations in the workplace.

The truth is the office will never be what it once was. In many ways, it’s a change that brings with it many benefits, and looking at the broader picture becomes critical here. The pandemic has forced companies to pause and rethink how they’ve been working, how businesses run, how employees are treated, and what is its impact on the planet. A leader who wants to do well in this new era of work will have no choice but to embrace a new work world with a renewed culture that places employees at the heart of the organization.

Here are the four key leadership trends in 2023.

1. Leading with a growth mindset

Growth mindset or learning agility is so essential because it helps leaders make quick decisions in times of crisis or change. This concept – Growth Mindset – that has been overused for years now becomes very relevant to this new way of work. According to US psychology professor Carol Dweck who first described this behavior in the 1970s, “People with a fixed mindset are more likely to stick to activities that utilize skills they’ve already mastered, rather than risk embarrassment by failing at something new”.

Growth mindset is, without a doubt, a key trait of leadership in 2023. Those who work at companies with a growth mindset are 65% more likely to say their company promotes risk-taking. They’re also 49% more likely to say their organization fosters innovation. Today’s leaders have little choice but to embrace a growth mindset; they need to be driven at the opportunity to learn new things. Leaders need to be willing to let go of their beliefs and strategies, and should be keen to identify newer and better ways of collaborating, inventing, communicating, and working. This is a leader who embraces failure and understands the value in learning from it and this is important because they can build a team with a similar outlook – who are able to have healthy disagreements, accept feedback from each other, and are driven to challenge their capabilities. And most importantly, be more excited to experiment, which in today’s dynamic workspace, is a huge benefit.

2. Supporting employee mental health

Each year, one in five adults in the U.S. will experience mental illness. Yet only one in three who need help will get it. What this leads to are employees who are frequently absent or are less productive while at work. – a phenomenon known as presenteeism. Presenteeism is when employees are at work but are struggling with physical or mental health issues. The World Health Organization (WHO) estimates that depression and anxiety cost the global economy $1 trillion per year in lost productivity. But WHO also found that for every $1 spent on treating common mental health concerns, there is a return of $4 in improved health and productivity.  According to recent research, 42% of global employees have experienced a decline in mental health since the pandemic began. This is why prioritizing mental health is so important for an organization’s bottom line.

During change, employees may experience fear, stress, and anxiety. The pandemic and what has come after has been an emotionally overwhelming time for many. Employees respond differently to coming back to work and being a leader who can recognize and support all responses is critical.  A supportive manager can have a direct, positive impact on the mental health and wellbeing of the faculty and staff they lead.

3. Introducing measurable DEI initiatives

In the past few years, there has been an increased spotlight on companies’ representation and diversity, equity, and inclusion (DEI) initiatives. The data shows us that only 53% of employees believe their employer is meeting its diversity, equity, and inclusion goals and close to 97% of employers report they have introduced new inclusion measures in the past year especially. However, 24% of employees believe their employer has not introduced any new measures. With 52% of employees considering moving jobs, putting in place DEI initiatives that are tangible and measurable and result in long-term change have become more important than ever.

Studies show us that the pandemic has magnified how diverse employees feel in the workplace, and not in a positive light. Merely establishing DEI initiatives doesn’t do much for creating a more diverse, equal, and inclusive team. Companies need to view DEI as more than just meeting hiring metrics. While metrics are important and can provide valuable insights on where attention is needed, in order to make real change, diversity and inclusivity need to translate into tangible and measurable results.

4. Embracing an empathetic leadership style

The lack of empathy in business costs an average brand up to $300 million of lost revenue annually. According to DDI, empathy levels are low in business leaders, as only 40% of them have proficient empathy skills. The study included 15,000 business leaders in high-performing leadership settings.

Empathy in leaders is critical as we collectively try to navigate this new era of work. With almost nine in 10 employees (86%) reporting that they can juggle work-life obligations under empathic leaders, leaders need to take their humanity to work. They need to give up stereotypes of leadership styles, and be creative in how they manage employees. Being genuine, making the effort to connect, communicating openly, and engaging more deeply with all those in the workplace will propel the team to better performance and productivity.

Empathy in leadership sets the foundation for employees and business outcomes in a positive manner. Navigating this dynamic terrain and ensuring teams are functioning at their best can be a challenge. Schedule a consultation with our team of experts at Talent500 if you’d like to know more about building and managing global teams.

Anushree Thammanna

Anushree Thammanna

Add comment