Strategy is Rarely the Constraint

The hardest questions we are asked no longer begin with strategy, but with something more fundamental: do we have the leadership to match our ambition?

As we move towards the final quarter of 2026, conversations with CEOs, Boards, CHROs and business leaders continue to be shaped by the familiar forces of technology, geopolitical uncertainty, productivity and transformation. What is changing is where those conversations land.

Less of the discussion now centres on technology itself, and more on the leadership, organisational capability, succession and execution required to make anything of it. The challenges continue to evolve, but across sectors and geographies a consistent set of themes is emerging and together they point to a single question organisations are circling: whether they have the leadership to match their ambition, and whether that capability is best developed internally or brought in from outside.

Leadership Capability is Moving Higher Up the Agenda

For several years, organisations have concentrated on strategy, transformation and growth. Today, many leadership teams are asking a more searching question:

Do we have the leadership capability to deliver any of it?

Strategy remains essential, but Boards and executive teams are increasingly focused on the quality of leadership beneath it, on succession depth, and on whether the organisation can execute.

As economic conditions, technology and customer expectations shift, the leaders in greatest demand are those who can operate across functions, navigate ambiguity, influence complex stakeholder groups and hold an organisation together through change. Capability is increasingly being judged less by what a leader has done and more by how they lead when the ground is moving beneath them.

The Role of the CHRO Continues to Evolve

If capability is the question, the CHRO is increasingly the person asked to answer it.

The evolution of the role is no longer about securing a seat at the table. Most leading people leaders secured that some time ago.

What we are seeing now is CHROs taking an active role in enterprise-wide transformation, organisational effectiveness, leadership succession and strategic decision-making. The expectation has moved well beyond stewardship of the people agenda, and many CEOs now look to their CHRO to help shape how the organisation adapts, simplifies, grows and performs.

The people leaders thriving in this environment are those who combine commercial judgement, leadership credibility and organisational insight in equal measure, and who are as comfortable discussing the operating model as the talent agenda.

The distinction between those operating as enterprise leaders and those working primarily within a functional remit is becoming increasingly evident.

Succession and Leadership Depth Are Becoming More Prominent

The first place organisations look for that capability is within, which is why succession has been one of the most persistent themes of the year.

Across many organisations, senior leaders are staying in role longer than anticipated. This often brings welcome continuity and experience, but it carries a cost. Future leadership opportunities become less visible, development pathways narrow, and high-potential leaders begin looking externally for the experiences they can no longer find at home.

Even Boards proud of the stability of their executive teams are finding, on closer inspection, that they have lost several of their most promising leaders in a single year, each to a bigger role elsewhere.

As a result, Boards are spending more time on succession, leadership development and talent depth, particularly at CEO, executive committee and functional leadership levels.

The question is shifting from who could step up today to whether the organisation is genuinely building enough leaders for tomorrow.

Organisations are Taking Bolder Bets on Leadership Talent

If succession is the answer from within, the other half of the equation is a growing willingness to look outside, and to look further afield than before.

Where organisations once defaulted to the closest match on paper, more are now willing to bring in leaders who will disrupt settled thinking, challenge orthodoxy and import fresh perspectives from adjacent or entirely different sectors.

The logic is sound. In markets being reshaped by technology and shifting customer expectations, deep sector experience is no longer the guarantee of performance it once was. A leader who asks unfamiliar questions can sometimes be worth more than one who already knows all the familiar answers.

This is rarely comfortable. The leader arriving from another sector must earn credibility without the shorthand of shared experience, and the team receiving them must unlearn the assumption that only insiders truly understand the business.

This is one of the more encouraging shifts of the year, provided it is done with discipline. A bolder bet on background must be matched by rigour in judgement.

Organisations getting this right are not lowering the bar. They are assessing candidates more thoroughly than ever on judgement, adaptability, values and the ability to lead people through the very disruption they have been brought in to create.

Boldness on experience and rigour on character are not in conflict. They are what make an unconventional appointment succeed.

Simplification Continues To Drive Organisational Decisions

Neither developing leaders internally nor bringing them in from outside pays off if the organisation around them is too complex to let them lead.

Organisational effectiveness has always mattered, but the emphasis on simplification has sharpened. Leaders are examining structures, decision rights, spans of control and accumulated complexity with far greater scrutiny, and the questions are practical ones.

Are decisions being made quickly enough?

Do reporting lines help or hinder execution?

Is accountability clear?

Are resources aligned to where value is actually created?

One of the clearest messages we are hearing from CEOs is that corporate functions can no longer afford to be inward-looking. Whether HR, finance, legal, risk or communications, functions are increasingly challenged to demonstrate their contribution to customers, revenue and growth.

The discussion is moving from activity to impact.

But none of this takes hold by mandate alone. For change and simplification to succeed, the ground has to be fertile, and that means the agenda must be visibly and consistently owned by the Board and CEO.

Where that sponsorship is present, simplification becomes part of how the organisation works. Where it is absent, complexity soon finds its way back.

The theme we keep returning to is a simple one: less is more.

AI is Raising Expectations of Leaders

If simplification is reshaping the organisation, AI is raising the stakes on everyone leading it.

The conversation has matured, and most organisations have moved beyond curiosity and experimentation towards implementation, productivity and measurable outcomes.

One observation stands out: AI is more often exposing the quality of leadership than replacing it.

It is also changing how the best leaders spend their time. As routine analysis and process are increasingly handled by technology, the leaders creating the greatest impact are those able to spend less time managing process and more time on customers, strategic priorities, talent and the decisions only they can make.

Technology can support judgement, but it cannot supply it. Organisations still depend on their leaders for prioritisation and the human connection that holds people together through disruption.

The organisations making the most progress are not those adopting the technology fastest, but those pairing it with clear leadership, organisational discipline and the will to execute.

The technology rarely separates the strongest organisations from the rest. The people deploying it do.

Early Careers Are Back in Focus

The longest-term answer to the capability question is the one organisations have most often neglected.

We are seeing renewed investment in graduate and early-career hiring across multiple sectors. This reflects a genuine concern about future leadership pipelines and long-term workforce capability, and a recognition that a pipeline cannot be built at executive committee level.

The roles being created today also look very different from those of only a few years ago. As repetitive, process-driven work becomes increasingly automated, organisations are placing greater emphasis on learning agility, adaptability and problem-solving than on procedural competence.

The future leadership pipeline is beginning to look different from the one that preceded it, and the organisations investing most seriously today are the ones least likely to be scrambling for senior leaders a decade from now.

More People Leaders are Joining Boards

As all of this rises up the executive agenda, it is reaching the boardroom too.
For years, people leaders supported Boards through remuneration committees and talent reviews. That contribution is now broadening because people topics have become business topics.

We are increasingly hearing Chairs discuss succession, leadership risk, culture and organisational effectiveness with the same seriousness they bring to financial performance, strategy and risk.

These are no longer treated as HR matters but as fundamental questions of business performance.

It is one of the reasons we believe demand for current and former CHROs in Non-Executive Director and Board advisory roles will continue to grow, as Boards seek sharper perspectives on leadership and the organisations they oversee.

Looking Ahead

As we move towards 2027, technology, productivity and transformation will undoubtedly remain high on executive agendas. Economic conditions will stay fluid, and customer expectations will continue to rise.

Yet most of the conversations we are having ultimately return to the same place:

Do organisations have the leadership capability required for what comes next?

Are they developing enough leaders for the future?

Are they organised to execute?

What will separate the strongest organisations is not the boldness of their strategy, but the depth of their leadership and the honesty with which they assess it.

The questions are not new.

What has changed is that the cost of getting the answers wrong has rarely been higher, and the advantage of getting them right has rarely been greater.