Leadership skills are changing as quickly as the world of business is changing. We’re halfway through 2025, and have witnessed the effect of trends that have been building up for years–and right now, it seems, is the tipping point. What does this all mean for HR and L&D professionals? We’ll walk you through the root causes of these disruptions, how HR departments are reacting, and the L&D steps that build modern manager competencies and resilience for your top people.
Top Trends: New Technology and Tough Economic Conditions
According to the World Economic Forum (WEF), two of the most important factors that are impacting companies in 2025 are:
Economic Challenges
The WEF believes that stagflation, i.e., a combination of slow economic growth and inflation, will be significant, although inflation is projected to decrease this year. For those of us who aren’t economists, this means that you can expect:
- More organizations may delay new investments
- A continuation in the rise of the price of goods
- Uncertainty about international trade relationships due to tariffs
Technological Change
We’ve all been tracking these developments for years, so it’s no surprise that AI and information processing technologies are big issues for business. AI is cited by 86% of employers as the most critical driver of technology-based business transformation.
Next up are robots and autonomous systems (58%) and energy generation, storage, and distribution (41%).
The fact that AI wins first place is both good and bad for HR teams. Robots and energy are relatively niche issues that are handled by specialists. But AI affects us all. You can expect many of the people in any company to eventually require some level of AI programming skills (currently, approximately 30% of US workers are already using AI in some capacity). But there’s a critical twist here.
AI: Always Innovate
We’ve glanced at the tip of the artificial intelligence iceberg, but what’s underneath? One theory is that AI will take our jobs.
Another, according to Forbes, is that it will replace people for certain tasks but on the flipside give them additional time to work on more valuable tasks. In addition, AI makes mistakes, and some of them are high-profile. Although AI is advancing in leaps and bounds, it is far from perfect. And lastly, AI is only as good as its programming. As the technology becomes more widespread, even non-technical people will need to learn how to customize it.
Future-Ready Leaders in the Age of AI
The developments in artificial intelligence relate directly to leadership. A recent study by Gartner looked at AI (among other issues) and how it affects organizational priorities for HR executives. The research reveals that leadership and management development is at the top of the list.
One way of thinking about artificial intelligence is that it is a significant organizational change. But, as Gartner explains, the very people who need to lead this type of change – managers – are already overwhelmed and insufficiently prepared for the tasks at hand.
Also, AI is changing the nature of leadership skills. Managers at all levels need the right abilities to act in a complementary nature when it comes to AI. In other words, future leadership skills will be used to plug the many gaps left by functions that AI cannot fulfill.
Top 4 Leadership Skills from the Industry’s Experts
There are dozens of soft skills that HR and L&D professionals might include in talent development courses, in light of the above facts. Leading voices in the human resources industry have researched what they believe are the most valuable leadership soft skills for HR teams to build right now–and they are:
- Innovation
There’s a lot more to innovation than just creative thinking. According to Korn Ferry and its study of the “World’s Most Admired Companies”, innovation starts during the hiring process of leaders. HR should be on the lookout for candidates who demonstrate an ability to learn quickly, and who show a deep interest in many fields.
Organizational culture is also critical, and the goal here should be to encourage innovation throughout the company. In reality, this means that leaders must be given the resources to be creative along with a green-light process that is rapid. Companies should invest in processes based on clear metrics and goals. For quick iterations, companies need to think about agile methodologies and team-based development projects. It’s the job of top management to oversee the entire process and be clear regarding how development relates to organizational strategy and goals.
Korn Ferry also explains that the basis for all of these skills and approaches is a growth mindset. This is defined as an understanding that “abilities can be developed”. Meaning, the only limitation on an employee’s ability to acquire new skills is their effort–and not the employee’s perceived level of intelligence.
- Networking
Gartner contends that the usual approaches to leadership development, like seminars and lectures, actually work against skills. Instead, L&D professionals should invest in networking opportunities for their leaders. This provides them with direct access to advice and support from their peers and higher-ups who can share ideas about the most up-to-date approaches to management, strategy, and everyday challenges.
Beyond this, HR can assist leaders in building the skills behind effective networking. These include:
- Communication – This seems obvious until you consider how complex networking can be. Hypothetically, it begins with small talk, but then expands to emails, presentations, and the exchange of ideas. A communication skills course, such as those through coaching, will allow leaders to make the most of every encounter.
- Active listening – Many of us are tempted to zone out or sit passively when a conversation drags on. Active listening skills are essential for managers to make employees at all levels feel heard, while enhancing their own level of knowledge.
- Critical thinking – Not every information exchange will benefit you. Over the course of building relationships, it’s important to focus on the advice and information that is most useful and relevant. Critical-thinking experts are a great way to develop this ability.
- Adaptive Leadership
While the WEF lists adaptive skills as important for all employees to have in 2025, managers need to go a step beyond this through adaptive leadership capabilities.
Innovation is different from adaptive skills. Whereas innovation is proactive, adaptation is reactive – but no less important. It is essential when you face a dynamic threat with lots of unknowns and many influences that are beyond your control.
Leaders who are adaptive are great at problem-solving and decision-making. Being able to handle stress is also important. And, an adaptive manager will often apply a framework such as IDEAL.
But perhaps the most essential quality of an adaptive leader is that they can leverage their team properly. When a crisis happens, a leader needs their team’s input to get a clear picture of the situation. Then the team can also be relied upon to brainstorm solutions and implement the best ones quickly.
- Change Management
You can look at AI and economic challenges as a sort of change management issue. It’s common for L&D programs to prepare managers for a situation of change by building related skills, like organization and time management. But handling a change management process (CMP) involves a lot more than the abilities of a manager.
That’s because it is a group effort that often faces internal resistance. According to the Harvard Business Review, CMPs often fail. This can be due to a lack of communication about why the change needs to happen, and the role of employees in adapting.
The complexity of CMPs make them an ideal area for learning and development programs, often conducted through a transformational/change management consultant. They will guide you through a holistic process that you can apply to many situations that require change.
Practical Steps for Building Modern Manager Competencies
The skills highlighted here are a strong starting point, much like a “wish list”. Your organization might not have the resources — and your leaders might not have the time — to work on all of these skills.
That’s why top talent development platforms begin any leadership program with customization. They use AI to match individual employees to the skills that they require. After all, it’s likely that many of the leaders in your organization already have some essential leadership skills, but not all of them, or not at an optimal level.
What you end up with is a set of courses where some are relevant only to the employee in question, while others are part of the current global skillset for managers.
Growthspace – Customized Talent Development for Leadership Skills in 2025
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