A year-in-review and look-ahead for small to mid-sized HR leaders
If you are an HR leader in a small or mid-sized company, 2025 was likely a demanding year. You balanced hiring needs, helped executives steer through uncertainty, and supported managers who were navigating hybrid work, shifting expectations, and increased stress. Throughout the year, expectations for effective leadership continued to rise. Managers were expected to communicate clearly, coach confidently, build trust, improve collaboration, and remain adaptable while managing their own performance.
As 2025 comes to a close, this is the perfect moment to reflect on the trends that shaped leadership this year and the signals emerging for 2026. Understanding these patterns helps you identify what your leaders need next and how to build a leadership strategy that strengthens your people and your organization.
2025 in Review: What We Saw in Leadership and People Development
Soft Skills Continued to Outperform Technical Capability
2025 reaffirmed what leadership researchers have been emphasizing for decades. Communication, emotional intelligence, conflict skills, and adaptability remain some of the strongest predictors of long-term success. Research originally attributed to Harvard, Carnegie, and Stanford highlights that soft skills account for much of a person’s effectiveness because they shape how people collaborate, solve problems, and lead teams. Stanford Online further reinforces that “soft skills” is a misnomer because communication, interpersonal awareness, and collaboration are core business capabilities.
In day-to-day practice, HR leaders saw that technically strong managers often struggled with coaching their teams, handling difficult conversations, or influencing others. Managers who succeeded were the ones who connected with people, communicated clearly, and led with empathy and awareness.
Manager Engagement and Stress Reached a Breaking Point
Engagement data in 2024 and 2025 signaled a persistent challenge. Reports such as Gallup’s State of the Global Workplace reflect that only a small percentage of employees are fully engaged and that low engagement significantly affects productivity and retention. Managers were especially impacted in 2025. They found themselves acting as intermediaries between executives and employees while navigating hybrid work, technology changes, rapid restructuring, and growing expectations around culture and communication. Business Insider’s analysis of Gallup data showed significant drops in manager well-being, engagement, and overall capacity.
HR leaders echoed similar concerns. First-time managers stepped into roles without clear guidance. Mid-level managers faced competing priorities and increasing pressure. Workloads expanded while support systems did not. The takeaway was clear. To improve engagement, companies must invest meaningfully in manager development.
Leadership Became More Complex Across Hybrid, AI, and Multigenerational Environments
Throughout 2025, leaders were required to adapt quickly to new technologies, communication expectations, and team dynamics. The Center for Creative Leadership emphasized that hybrid leadership requires stronger communication and trust-building than traditional models. Stanford’s Center on Longevity found that multigenerational workplaces demand flexibility and awareness because employees value different types of feedback and collaboration. Meanwhile, evolving research on leadership development highlighted that managers must learn to integrate AI tools while still leading in human-centered and ethical ways.
The organizations that navigated this complexity successfully did not rely on more manuals or content. They focused on developing leaders who could stay adaptable, communicate clearly, and remain grounded in their values while leading through constant change.
What’s Coming in 2026: Leadership Trends Every HR Leader Should Prepare For
Looking ahead to 2026, several leadership trends are emerging across HR research, industry reports, and workplace observations. These trends point to a need for leadership development that is practical, consistent, and grounded in the real challenges managers face every day.
Trend 1: Leadership From the Middle Becomes the Growth Engine
Organizations are recognizing the critical role of mid-level and front-line leaders in shaping culture, engagement, and retention. Research and HR forecasts for 2026 point to increased investment in developing leaders in the middle of the organization, not just executives. These leaders influence day-to-day performance, team morale, and communication flow, yet they often receive the least training.
Strengthening leadership at this level creates more consistent management practices, improves cross-team collaboration, and increases a company’s capacity to execute strategy effectively.
Trend 2: Reskilling Focuses on Adaptability, Connection, and Responsible AI Use
2026 HR outlooks highlight a dual need for leaders who can integrate AI tools responsibly while maintaining strong interpersonal and communication skills. Leaders will need to navigate AI adoption with transparency, fairness, and clear communication. At the same time, they will need to strengthen adaptability, empathy, and emotional intelligence as expectations rise and change continues to accelerate.
This means leadership development should focus on both technical shifts and human-centered capabilities, helping managers guide teams through uncertainty with clarity and confidence.
Trend 3: Sustainable Performance Becomes a Strategic Priority
Employee stress levels remained high throughout 2024 and 2025, and many organizations faced challenges tied to workload, meeting overload, and unclear expectations. In 2026, sustainable performance will become a larger focus. HR leaders will pay closer attention to capacity, boundaries, and team well-being. Cultures that support clarity, psychological safety, and healthy work rhythms will have a competitive advantage.
Leadership development that strengthens coaching, delegation, clarity, and prioritization will help managers create healthier and more sustainable performance cultures.
Trend 4: Managers Want Spaces to Talk Through Real Situations
One of the most consistent insights HR leaders shared in 2025 is that managers do not need more content. They need spaces to talk through real challenges in real time. Monthly leadership labs, one-to-one coaching, and peer groups have become increasingly valuable because they help managers apply concepts directly to their day-to-day situations.
Leaders benefit most from development formats that are conversational, practical, and tied to the actual conditions of their roles.
Four Practical Moves HR Can Make in 2026
Below are four strategic moves HR leaders can make in 2026 to support managers in a sustainable and meaningful way. Each recommendation aligns with the trends above and is actionable for small to mid-sized organizations.
1. Build a Structured Development Path for New and Rising Managers
Promoting high performers into management without training creates risk and misalignment. A structured development path gives new managers clarity, confidence, and essential tools from the start. It helps them learn how to communicate effectively, set expectations, give feedback, delegate, and lead with emotional intelligence. This reduces early missteps and builds a stronger bench of future leaders.
2. Invest in Soft Skills That Directly Influence Performance
Soft skills drive hard results. Strengthening communication, emotional agility, interpersonal awareness, and conflict skills improves collaboration, increases trust, and supports stronger team performance. These skills are essential for navigating hybrid teams and cross-functional environments, making them a high-value investment for 2026.
3. Offer Managers Real-Time Support and Coaching Opportunities
Managers need support they can use immediately. One-to-one coaching, monthly leadership labs, and peer groups give leaders a place to think out loud, troubleshoot challenges, and apply new approaches in real time. These formats increase confidence, reduce burnout, and help managers stay aligned with organizational values and expectations.
4. Personalize Development With Assessments and Targeted Tools
Assessments such as CliftonStrengths, DiSC, and 360 feedback offer personalized insights that help leaders understand their tendencies, blind spots, and communication preferences. When paired with coaching or applied workshops, assessments provide a shared language for development and accelerate leadership growth in meaningful ways.
Preparing for 2026 With a Strong Leadership Strategy
This is the perfect moment to assess how your managers are doing and what they will need to thrive in 2026. Research and workplace trends point to one consistent message. Leadership development must be practical, relevant, and supportive of real managers navigating real challenges.
Whether your focus is soft skills, structured development paths, personalized assessments, or ongoing coaching support, investing in leadership will help your managers communicate more clearly, collaborate more effectively, and build a healthier, more resilient organization for the future.
