Leadership DevelopmentARTICLEThe shifting paradigm of executive leadership developmentMoving the focus to the impact of th...
Oliver Wyman Leadership Development                                      With all of this activity and expense, it seems a...
The shifting paradigm of executive leadership developmentCurrent practice in leadership                           In theor...
Oliver Wyman Leadership Development                                      made any progress on their development plans or i...
The shifting paradigm of executive leadership developmentthat no individual can get much accomplished              As a re...
Oliver Wyman Leadership Development                                      theories and research, then the faculty-driven pr...
The shifting paradigm of executive leadership developmenttranslate the cumulative changes in individual         that learn...
Oliver Wyman Leadership Development                                      individuals in the executive pool were in similar...
The shifting paradigm of executive leadership developmentAs its frame for leadership initiatives, we propose    Benefits o...
Oliver Wyman Leadership Development                                      own personal results. Imagine this phenomenon rep...
The shifting paradigm of executive leadership developmentthe transition to a desired future state. And those     „„   The ...
Oliver Wyman Leadership Development                                      Table 1.1                                      Di...
The shifting paradigm of executive leadership developmentinterventions are therefore used to foster an enter-             ...
Oliver Wyman Leadership Development                                      compares to more traditional metrics such as a ch...
The shifting paradigm of executive leadership developmentnotion of the teachable moment and the various         Governance...
Oliver Wyman Leadership Development                                      A case example: New executive                    ...
The shifting paradigm of executive leadership developmentMembership on the I&VT team was a result of a           out. Give...
Oliver Wyman Leadership Development                                      Deploying senior executives to drive integration ...
The shifting paradigm of executive leadership developmentstakeholders. They traveled outside IBM and           anecdotal b...
Oliver Wyman Leadership Development                                      and performance within the learning teams. Mike e...
The shifting paradigm of executive leadership developmentthe initial team launch and the chartering process,      The prog...
Oliver Wyman Leadership Development                                        coordinated way. Therefore, we designed a proce...
The shifting paradigm of executive leadership developmentSVPs assumed responsibility to ensure that aspira-      that was ...
Oliver Wyman Leadership Development                                      went outside to hire external consultants, speak ...
The shifting paradigm of executive leadership development  included how to gain organizational acceptance for an        „„...
Oliver Wyman Leadership Development                                           tives. Organizations that lack these interna...
Leadership Development Article
Leadership Development Article
Leadership Development Article
Leadership Development Article
Leadership Development Article
Leadership Development Article
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Leadership Development Article


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At a recent meeting I was able to listen to Trina describe a new approach to Leadership Development. Here co-author Trina Soske describes the latest thinking on the matter.

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Leadership Development Article

  1. 1. Leadership DevelopmentARTICLEThe shifting paradigm of executive leadership developmentMoving the focus to the impact of the collectiveby Trina L. Soskeand Jay A. Conger T oday’s approaches to executive development fall seriously short and signify a need for rethinking and change. Specifically, we must shift our emphasis from individual-leader development to collective leadership capability. This requires a change in the overall frame for executive development, a new definition of leadership, and a change in the mechanics of how programs are designed, governed, measured, and implemented. IBM is used as a field example to illus- trate this new approach. The number of leadership development initiatives has exploded over the past twenty years. Leadership has become a hot business topic, with thousands of books and articles on the subject having been printed in that time frame. Until recently, business-school executive- education programs and consultancies that provide these services have enjoyed double-digit growth rates year over year. Keeping pace, most corporate learning and development functions have expanded to include senior positions and supporting staff focused exclusively on executive and leadership development.
  2. 2. Oliver Wyman Leadership Development With all of this activity and expense, it seems appropriate to ask: „„ Has the investment in these efforts paid off, however the return is measured? „„ Is the caliber of business leadership stronger today than it was twenty years ago? „„ What are we doing well, and where are we dropping the ball? More fundamentally: „„ Are we truly competent as a development industry? „„ Do we understand the real impact of our interventions, and do we apply them to the appropriate situations? And not least: „„ If any one of us were a CEO evaluating the various levers to improve organizational performance, would we select leadership development versus the alternatives? Complete answers could fill several books. In this article, however, we can make several assertions about the state of practice in execu- tive development today. Furthermore, we argue a case for change and describe what one part of that change might look like. We also provide a case example of one company’s attempts to move in this direction. In so doing, we hope to provoke a fresh evaluation of the goals and methods of leadership education for executives. We hope to reframe how we think about the what, why, and how of developing executives to become effective leaders.2
  3. 3. The shifting paradigm of executive leadership developmentCurrent practice in leadership In theory, the process of designing the learning experience starts with a needs analysis to iden-development for executives tify the mind-sets and skills that the executives need to develop. More often than not, the analysisAlthough the practice of executive development includes benchmarking how the executives scorevaries, most programs today have some standard on a leadership-competency model. From there,components (Conger and Benjamin, 1999). At the the executive-development staff defines learningrisk of oversimplification, the learning experience objectives, develops the program architecture, andis structured around a two- to five-day format that makes specific design decisions regarding content,includes: learning methods, and outcomes. The outcome„„ Senior leader speakers and sponsors, especially objectives for these programs range from strength- at kickoff and closing ening individual leadership skills, to accelerating adaptation to a new business model, to a more„„ Classroom-based pedagogy focused on an array singular focus on facilitating growth, innovation, of content domains (leadership, strategy, organi- cross-company collaboration, or developing a zational change, finance) that may include both global mind-set. plenary and small-group breakout sessions„„ Personal coaching on assessment feedback Most internal executive-development groups around specific leadership behaviors supplement their internal staff with outside contract resources to design, develop, and deliver„„ The creation of an individual development plan the programs. These outside firms bring their own„„ Any variety of guru or topic-expert speakers, standardized frameworks, models, and pedagogies. experiential activities (outdoor team building, Most of their leadership-competency models are metaphoric learning, or community service), sourced from research based on large samples of benchmarking field trips, business simulations, managers representing many different industries. and action learning projects As a result, the competency models behind many executive programs are generic. In other words, theSome companies have recognized the limits of promise of truly customized programs is largelythis multi-day episode approach to learning and illusory. Similar programs are being deliveredhave instead opted for a twelve- to eighteen-month within and across industries. Well-customizedexperience with bookend events and activities to materials, frameworks, and models are rare.sustain continued learning and provide reinforce-ment. But even these organizations are still pris- Most programs are deemed a success if the partici-oners of a learning paradigm built around highly pants enjoyed them and rate them highly oncontained and strictly bounded educational events. end-of-program evaluations. Some organizations go further and follow up with 360-degree feedback evaluations to see whether individuals have 3
  4. 4. Oliver Wyman Leadership Development made any progress on their development plans or in the areas they identified for improvement during the program. In cases that use action learning projects, organizations might or might not measure the business results subsequently produced by projects. And finally, the genesis for many of these programs arises from chasing a seal of approval associated with having them in place (the assumption is that if an organization has an executive develop- ment program, then its leadership development processes is in order) and ‘‘keeping up with the Joneses’’ (ensuring that your company is doing the latest and greatest and keeping up with industry peers). More seriously, some programs are a response to succession plan- ning and talent issues of concern to the senior leadership team and board of directors. Why todays approaches fall seriously short If our description is, in the main, a valid profile of the majority of executive-education programs, we can identify a number of critical shortcomings and specious assumptions embedded in the ways that we’re approaching development. We begin by looking at certain realities about leadership development itself and how those realities challenge our past assumptions and approaches. All these realities, which we examine next, mean that we must shift our emphasis in executive education toward collective development and content focused on useful application. Leadership is not an individual act For the most part, the exercise of leadership in organizations is not an individual act. Despite the continued popularity of the ‘‘great person’’ theory of leadership and our romantic attachment to the idea of a rugged individual who is going to ride in and save the day, leadership is a team sport. Why? One reason is that the complexity, interconnectedness, and transparency of today’s organizations mean4
  5. 5. The shifting paradigm of executive leadership developmentthat no individual can get much accomplished As a result, in too many cases, learning and devel-alone. The nature of most challenges and oppor- opment staff create award-winning programs fortunities is systemic. Leadership in an organization companies that afterward continue to suffer a hostis more distributed, and hence change requires of business leadership problems. Investment banksa more collective sense and a coordinated set of just two years ago had some of the so-called bestactions. leadership programs in the industry. It is difficult to witness what has happened to an entire industryA second reason is that most leadership is exer- and not wonder about the real leadership failingscised within a team or broader organizational that these programs never addressed. One iscontext—whether a project team, intact leader- reminded of Florida Public Power and Light, whichship team, or cross-functional team. But if it’s all received one of the first Malcolm Baldrige Awardsabout leading together—and that’s the way work for Quality and a year later filed for bankruptcy.gets done and change happens—then why does somuch of the field still focus on developing people The risk of a programmatic approach to leader-as individual leaders? We suspect that the answer ship is that it becomes separate from the businesslies in the fact that the field is a prisoner of a long instead of being an in situ practice. Programs arehistory of models and pedagogies built around an something that the HR folks worry about, lineemphasis on the individual leader. management attends them, and then everyone gets back to real work after they end. LeadershipIn turn, individual-leader development has led development that becomes distinct from whatto a focus on leadership behaviors and attributes leaders do every day poses substantial risks to therather than leadership issues facing the enter- quality of leadership practice within the organiza-prise. For this reason, most programs are designed tion. It is unlikely that enduring developmentalaround behavioral-competency models. A lot of change will take place.time and money are spent thinking about leader-ship behaviors, while real leadership issues facing Learning professionals versus line leadersthe organization are left unattended—for example, Separating leadership development from actualcritical shifts in the enterprise strategy, problems situational leadership problems segregates thein the product-innovation process, or new compet- activities behind leader development as theitive threats. domain of HR, learning professionals, academics, and consultants instead of extending the designPreoccupation with programs and content of such activities to line leadersAs leadership and executive development themselves. One could ask, ‘‘How can peopleprograms have arisen andmatured, they have who are not leading line organizations teachbecome self-contained and functionally specific anything to others about leadership?’’ If leader-human resource (HR) ends in and of themselves. ship is treated as an academic topic, focused on 5
  6. 6. Oliver Wyman Leadership Development theories and research, then the faculty-driven programs might be acceptable, albeit limited. But the live exercise of leadership is not an academic activity. It is about real people trying to get real things done in a highly particular context, multiple times throughout the day. Leadership shows up—or not—in a series of real-life moments. Therefore, we think it suspect that so many leaders are being taught by individuals who have no experience with the leadership tensions, paradoxes, and crucibles that the participants handle every day. This is one of the primary reasons that executive-education programs have increasingly involved senior line leaders among the faculty. Individual leader focus inconsistent with desired change Individual leader development is not synonymous with the purported changes in behavior that designers and sponsors often say they want to see. Very often executive development programs are commis- sioned to address organizational goals of culture, mind-set, or other types of overarching organizational change as their proclaimed aim. Yet much of the content is focused on generic behavioral competen- cies and abstract concepts and frameworks. It is as if the top two- or three-hundred executives spending two to five days listening to content experts exploring ideas will somehow fundamentally alter the organization’s performance. Absent a larger architecture for the organizational transformation that is desired, the executive- development program’s potential contribution to it is largely wasted. Top executives, like anyone else in the organization, will do what’s rewarded. Unless some of the critical systems, processes, and struc- tures necessary to support and reinforce the new behaviors are in place, the purported changes aren’t likely to happen. In the end, changes in performance-assessment dimensions, rewards, and promotions are likely to be far more powerful drivers of behavioral change than a training program. A measurement conundrum Measuring the contribution of individual leader development remains elusive. While organizations often measure a change in the multi- rater behavioral profile of a participant, it is next to impossible to6
  7. 7. The shifting paradigm of executive leadership developmenttranslate the cumulative changes in individual that learning will not result in behavior changeassessment data to business impact. Hence, most unless it is reinforced over time. In spite of this, 75professionals take it on faith that leadership percent of most budgets are spent on the learningdevelopment is a good investment. Although this episode (a singular moment involving a relativelyassumption certainly has some face validity, real short span of time), with little time, attention, orquestions remain as to whether these investments resources spent supporting, reinforcing, and other-clear the organization’s hurdle for rates of return wise putting the learning into action, or embed-and how the returns compare with alternative ding the concepts in the way things get doneefforts and expenses. around the organization.This measurement conundrum has also led to a Our continuing ignorancepotentially dangerous separation between leader- In truth, we don’t know that much about howship development and leadership outcomes. In to effect deep transformation through executivealmost any other arena, it is difficult to imagine development interventions at the level of thetalking about good leadership without the mention individual or the collective. While HR and lead-of equally good results. Can any of us think of ership development–oriented professionals area great coach, great politician, or great business personally drawn to the notion of creating thatleader without a winning season, policy coup, or profound moment of learning—the moment whenoutstanding growth or profits? While results may a program participant experiences an "aha!" andbe necessary but insufficient, the corollary is that with determination begins to transform himselfthey are the sine qua non. or herself—the reality is that the field does not yet have a way to assess learner readiness (a keyMismatches with adult learning determinant of what sticks to the learner). InEducational approaches are often at odds with addition, we cannot know for sure what educa-what we know about adult learning. For example, tional inputs (content, process, or experience) willwe know that adult learners require high levels produce a particular desired outcome in an indi-of perceived relevance in order to be open to new vidual or a collective. In other words, our interven-ideas. Yet programs often draw few compelling tions are a hit-or-miss in terms of outcomes. Evenlinks between program content and the partici- academic research on executive learning (a smallpants’ on-the-job performance. We know that body of work) offers limited insights.learning while doing is a highly effective methodfor facilitating individual and organizational Variation in readinesslearning. Yet actual application experiences may This reality is confounded by the wide variationbe few and far between. Instead case discussions in the degrees of readiness to learn among anyand competency-feedback sessions comprise the pool of executives. It would be one thing if allbulk of the educational experience. We also know 7
  8. 8. Oliver Wyman Leadership Development individuals in the executive pool were in similar developmental places, but that is never the case. What is relevant to one execu- tive learner may be entirely irrelevant to another. Developmental receptivity therefore varies widely across an executive audience. Yet design choices about the content and educational processes are either reduced to that of the lowest common denominator (not very inspiring) or produce a smorgasbord approach that aims to provide a little bit of everything, in the hope that everyone walks away with something. What we do know about individual development is that it is just that: an individual process, with potentially as many segments of learners as there are individuals in the room. The new frame: Collective development and enterprise applications The shortcomings we have identified tell us we need to rethink and change the current practice of executive development. And consid- ering the radically difficult economic climate and the tough trade- offs that senior teams urgently need to make about how to spend limited resources to improve organizational performance, we need to change quickly. A shift to collective aims Many of the weaknesses of current practices would be ameliorated if executive-development efforts shifted emphasis from individual- leader development to collective leadership capability. We are not suggesting that we simply discard individual-leader development; organizations can do both individual and collective work as separate activities, and the collective development will continue to depend in part on successful individual-leader development. But we are urging that collective leadership become the primary, foreground develop- ment goal versus a secondary, background concern.8
  9. 9. The shifting paradigm of executive leadership developmentAs its frame for leadership initiatives, we propose Benefits of the new framethat executive development adopt the construct Multiple benefits accrue from this reframing ofof shared leadership that has emerged in the executive development toward collective develop-academic literature. Under this construct, leader- ment and enterprise applications. First, this newship is defined as ‘‘a dynamic, interactive influ- frame would provide greater alignment betweenence process among individuals in work groups goals and methods, in addition to a more visiblein which the objective is to lead one another to connection to business results and outcomes.the achievement of group goals’’ (Pearce and Second, it would leverage the potential energy ofConger, 2003, p. 1). This definition more realisti- the senior managers who are spending concen-cally recognizes that leadership is greater than one trated time together. One could argue that theindividual and moves the field away from a tradi- opportunity to influence the hearts and minds oftional focus on a superior’s downward influence this group is hugely underestimated and under-on subordinates. leveraged as a lever for performance and change. For example, executive development could be used to establish clarity about the direction, provide aA shift toward application platform for coordinated and aligned action, andThe second critical shift—to application-oriented articulate the values in action that would guidecontent geared to enterprise challenges—has the exercise of their leadership and judgment asbeen gaining momentum since the growing popu- a collective. Third, the new frame would providelarity of action learning programs in the 1980s, a more relevant learning environment, and oneespecially those popularized by General Electric. in keeping with what we know about how adultsEnterprise leaders today face marketplaces charac- learn. Fourth, the new frame would place leader-terized by constant change and great complexity. ship issues squarely where they belong: in theAs such, learning how to lead the direction, inten- hands of enterprise leaders. Fifth, it would addresssity, and speed of strategic and organizational one of the vexing executive-development issueschange is today’s key driver of corporate success. today: How do organizations get their top leadersLeadership development interventions should to think and behave like enterprise-wide leaderssupport these drivers. Such interventions are likely and address in unison enterprise challenges?to have the greatest payoff and are likely to be theeasiest to sell to the organization. This emphasis The reality is that many senior leadership teamson enterprise applications will demand that educa- are not teams at all because they have no realtional initiatives become far more customized and shared agenda or set of initiatives that they aretightly integrated to the organization’s strategic responsible for driving collectively. Their conver-agenda. Their aim will be to build leadership capa- sations are simply reports to one another on howbilities while simultaneously facilitating progress their function or geography is doing. Individualtoward critical strategic objectives. executives are mostly held responsible for their 9
  10. 10. Oliver Wyman Leadership Development own personal results. Imagine this phenomenon replicated through an entire executive corps—and then contrast this with the very real succession needs of most organizations for a ready-to-go group of enterprise leaders. A huge benefit of more collectively focused development interventions is that they support this enterprise-leader perspective, sense of responsibility, and shared leadership identity. An enterprise strategic-change agenda To shift how we practice executive development requires a change in the overall frame for executive development and in how programs are designed, governed, measured, and implemented. We will start with the overall new frame in which two guiding questions shape initiatives: What must the organization do in order to win in its marketplace? How can the executive group best be used as a lever to achieve these ends? The starting point is thus an enterprise-level strategic-change agenda, or some proxy thereof. From here, there is the open-ended inquiry into how best to engage and deploy the senior-most resources to drive change. The potential answers to this latter question may include an executive summit or off-site meeting, a strategic set of conversations or town hall meetings, a process to give life to corporate values, a reinvigorated business-planning process of a new way of thinking about the business, a set of processes to generate strategic alignment and fine-tune execution, or an executive-development program or process. This lens is strategic, first defining the business outcomes that are to be achieved, and then evaluating the efficacy of various possible means to those ends. We define the problem or opportunity before selecting a solution. Once the desired change is articulated, the purpose of any interventions can be clearly defined and the interven- tions themselves refined accordingly. From the perspective of organizational transformation, change inter- ventions involving the executive cohort can significantly accelerate10
  11. 11. The shifting paradigm of executive leadership developmentthe transition to a desired future state. And those „„ The new frame asks, ‘‘Where does the organi-interventions need to be augmented by parallel zation need to go, how is it going to get there,streams of work to support the overall change and what do we need to do—as a group ofeffort. leaders—to make this change happen?’’ The old frame asks, ‘‘How do our executives’ 360-degreeThis new frame contrasts markedly with the assessment data look compared to the compe-current executive-development frame. Now, most tencies in our leadership model? What strengthsorganizations determine that they want or need an can we build on, and what weaknesses do weexecutive-development program and then go about need to shore up?’’trying to figure out what the program content and Bluntly put, the new frame directs efforts inpedagogical approach should be. Often this need is service of a mission-critical goal, while the oldsimply described as ‘‘greater leadership capacity.’’ one often now amounts to programs in searchThis approach presupposes a solution and then of a purpose. Finally, the new enterprise framebacks into the potential needs it could fill. ensures crystal-clear alignment between the goals and methods, making us consider that perhapsDifferences are stark between the old (individual) the most appropriate way to mobilize executivesand new (enterprise or collective) organizational in support of the future state is not an educationalframes: program at all.„„ The new one is enterprise-wide and strategic. The old is functionally specific (HR) and more More systematically, what follow are brief discus- tactical and behavioral. sions of nine critical ways or dimensions by which the new enterprise frame improves on the old„„ The new one is more integrative and systemic. individualistic frame. We summarize those dimen- The old one is more siloed and disconnected. sions in Table 1.1.„„ The new one regards executive development as a vehicle to achieving a higher-order organiza- Unit of analysis tional goal. The old one regards development as Through the enterprise frame, organizations view an end in and of itself. the top executives as an entire cohort, along with„„ The new frame acknowledges the primary its potential to drive change, as the relevant unit of responsibility of the executive corps to improve analysis. Their collective role in driving change is performance and promote change. The old at the forefront, both instrumental to and synony- frame tends to back into what leaders must do mous with the achievement of a mission-critical differently as individuals to make the change goal or strategic agenda. The topic of leadership, happen and then tries to answer the question of then, is neither an abstraction nor purely behav- ‘‘what change?’’ ioral. It is real and context-dependent. The exer- cise is about results and action. Developmental 11
  12. 12. Oliver Wyman Leadership Development Table 1.1 Dimensions of individual versus collective executive-development approaches Dimension Individual-focused Collective-focused leader development leadership development Unit of Individual leaders as Executive cohort as the analysis agents of change agent of change Overarching Develop leadership Address strategic change purpose qualities, attributes, and and build collective competencies leadership identity Needs Competency models, Critical business issues, analysis 360-degree assessment change agendas data Desired Individual development as Collective capability to outcomes a leader drive business results Program Time away from business Time spent on the interventions on education business, learning in situ Timing and Short, bounded confines of Longer, blurred resourcing program; HR funded boundaries; business-unit funded Faculty External leadership, expert Senior leaders, peer content, and subject learning matter expert speakers Supportive Program design and Organizational develop- HR development ment or organizational capabilities effectiveness process consulting skills Governance Led by HR or leadership Group executive led, development, with group with HR or leadership executive input and development as partner approval12
  13. 13. The shifting paradigm of executive leadership developmentinterventions are therefore used to foster an enter- Desired outcomesprise-level leadership identity, way of thinking,and sense of accountability. In contrast, the unit of The desired outcome of collective capability-focusedanalysis for many current development initiatives leadership efforts is executive-led organizationalis the individual executive. transformation versus the individual development of the leaders. Although this does not preclude individual leadership competencies being picked upOverarching purpose along the way, the focus is on supporting top leadersFirst and foremost, the purpose of a collectively in their efforts to drive change.focused leadership activity is to address stra-tegic change and collective leadership issues. Goals typically include strategic alignment, execu-Interestingly, these goals may or may not suggest tion, change, development of a common culture ora programmatic or educational approach as execu- modus operandi, accelerated work on a strategictive development hereto has been defined. In agenda, and senior-executive role modeling. Incontrast, the central purpose of an individual contrast, individual-development programs havedevelopment frame is to strengthen the personal the more typical goals of preempting leadershipleadership capabilities of individual executives. derailments, managing career transitions, and supporting personal change.Needs analysisWith the enterprise approach, the diagnosis that The key metrics for collective-focused efforts areprecedes prescription has more to do with a deep the measurement of cost savings, revenue growth,understanding of the strategic issues facing the or other direct business results from key initia-firm and the leadership challenges associated with tives, in addition to a more qualitative accelera-achieving them. This contrasts quite significantly tion or completion of a strategic agenda. It is alsowith many of today’s programs that focus on the common to take notice of an executive’s contribu-development of individual leadership qualities, tion to the effort, the team, and their individualattributes, behaviors, and characteristics. In these performance or growth. In the last regard, thecases, the needs analysis is often a comparison of data tend to be observational—a function of the360-degree feedback data relative to a competency process consultant, coach, senior-level champion,model. or sponsor’s live interactions with the individuals throughout the process. Although these qualita- tive data about how they showed up in the process are less precise than changes in 360-degree feed- back, many organizations believe that these data are a better indication of real leadership capability and potential. This emphasis on business results and fishbowl observations in the line of real work 13
  14. 14. Oliver Wyman Leadership Development compares to more traditional metrics such as a change in 360-degree assessment data, participant survey data, and derailment and reten- tion data. Program interventions Since the interventions are built around a specific business issue, the connection to business results is direct. Executive time is spent on the business instead of away from the business. The executives work on real projects critical to the organization’s performance rather than projects made up as a vehicle for learning. This contrasts markedly with the carefully crafted portfolio of action learning projects that organizations typically assemble to provide a platform for cross- functional work and individual learning. Normative criteria regarding scope, timing, requisite resources, geography, and others are used to define action learning projects so that they conform to the strict boundaries of the development program, especially time. Timing and resourcing Organizational and strategic change takes time and, in most cases, money. It certainly does not take place within the strictly bounded confines of a two- to five-day program, absent any new data, anal- ysis, or thought. Transformative efforts involving the top executives often can take months, if not years, to fully complete—and even longer to completely tally the results. In addition, the analytical efforts can require external consulting resources, extensive inter- nally conducted analysis, travel dollars to support customer and market research, and so forth. Faculty In collective-leadership interventions, the senior leaders generally assume a strong ‘‘leader as teacher’’ role. This line-led learning is complemented by peer-exchange learning and supplemented by relevant outside expertise. This model, borrowing from Noel Tichy’s14
  15. 15. The shifting paradigm of executive leadership developmentnotion of the teachable moment and the various Governanceleadership practices that support Senge’s learning In all cases we have seen, the CEO is the sponsororganization, contrasts sharply with the external of the initiative, exercising significant influence onfaculty and subject-matter experts that pepper the scope and nature of the activities. Not only isthe typical two- to four-day program. This is not his or her role crucial to the launching and char-to say that these collective initiatives do not use tering of these efforts, but the CEOs continuedexternal speakers and new ideas. Rather, they do availability and willingness to act as a thoughtnot confuse exposure to new ideas with radically partner throughout the process is key to success.changed Monday-morning performance. Direct reports to the CEO often act as cham- pions, but they also can be assigned project-lead responsibility. This type of involvement contrastsSupportive HR capabilities sharply with the keynote or closing speeches thatWhereas the typical executive-development most CEOs or senior leaders provide to traditionalprogram requires expertise in leader develop- programs, or their occasional involvement as thement, individual assessments, program design and ‘‘leaders as teachers’’ portion of the program.development, and adult learning, the more collec-tive capability efforts demand a broader and more In terms of overall governance, decision rightsorganizational lens. This view means that prac- belong to the CEO and his or her team, withtitioners must understand how strategic agendas support from the HR or LD (leadership develop-are enacted in complex organizations, how to stage ment) functions. Again, this contrasts starklyorganizational learning that supports key organiza- with some of the more programmatic develop-tional transformations, and the nexus of strategy, ment efforts, where HR or LD owns the programleadership, and learning—in addition to the previ- and many of the decision rights, with input andously mentioned areas of expertise. It also requires approval by the CEO and top executives.more of a line than staff perspective and a corre-sponding focus on business results instead of ideas. In this collective model, top leaders assume active responsibility for the development of leadershipCollective interventions tend to require a lot in their organization. In the traditional model, topof courage and real-time consultative and facili- leaders have a more passive role, mostly facilitatedtative capability. Since the processes are more by others (HR).openly designed, and much of the work takesplace live, the interactions are not as carefullycontrolled, and many unexpected things canhappen in the learning container and leadershiplaboratory created. 15
  16. 16. Oliver Wyman Leadership Development A case example: New executive leadership development at IBM In this section, we take a deep look into IBM’s ongoing efforts to mobilize and deploy its top three-hundred senior executives to achieve its strategic change agenda. This case illustrates richly the implications and questions regarding the collective leadership devel- opment paradigm we have been describing. In particular, we look at how IBM approaches the specific set of leadership development dimensions we have outlined. Purpose: Creating the integrated IBM In fall 2005, Sam Palmisano, chairman and CEO of IBM, deter- mined that he needed to galvanize his senior leaders around the theme of an integrated IBM. The company had unmatched breadth in its product and service offerings among its industry peers. But Palmisano felt there needed to be far greater coordination among the company’s operating groups—computer hardware, software, and services—to truly leverage this breadth of offerings to customers. To begin the enterprise-integration process, in January 2006, Palmisano formed a new leadership body of approximately three- hundred executives from across the organization. This group was named the Integration & Values Team (I&VT). Their explicit mission was to lead enterprise integration as well as to model a new set of leadership values that recently had been promoted. The new values emerged from a process launched in 2004 called a ‘‘values jam’’—a threaded conversation across its fifty-thousand employees. From this conversation, three core leadership values were confirmed: dedication to every client’s success, innovation that matters—for the company and the world, and trust and responsibility in all relation- ships. Having completed the process of identifying the new values, it was time to breathe life into them by having the senior-most leaders model the values.16
  17. 17. The shifting paradigm of executive leadership developmentMembership on the I&VT team was a result of a out. Given how interconnected global compa-highly deliberate and collective conversation about nies like IBM are, we believed that no individualthose executives who were most capable at moving can do anything by themselves. It’s all aboutthe organization forward on its integration goals. leading together, and leading together—or collec-Eventually three selection criteria emerged and tive leadership—is about two things: thinkingformed the basis for membership decisions: their together and acting together. So if this is how stuffformal role in the organization, their three-year gets done in organizations, then why would weperformance history, and their leadership in the continue to develop people as individual leaders?areas of growth and integration and the IBM lead- It was clear that we needed to develop them withership values. the collective capability in mind, getting them to think together, work together, and lead together for collective and enterprise results. Personally IA shift in the leadership paradigm think this shift is just beginning to happen in thePrior to this initiative, IBM had focused largely leadership development industry.’’on developing leaders as individuals. As a result,it tended to be assessment-center or career-tran-sition oriented in its program approaches. The Top executives as a key change levercompany’s programs also were more focused on Since the goal of this effort was a transforma-introducing executives to new ideas than they tion in the enterprise, and leadership is the mostwere toward achieving business results. So, for critical and yet most often neglected lever ofexample, action-based learning was absent from large-scale change, a road map was needed forthe company’s portfolio of development programs. clarifying the roles that leaders in the organization would play in making change happen. A one-pageBut the company’s concept of leadership was change-engagement process was created thatshifting away from an individual frame of refer- identified the primary roles. Sam, the CEO, wasence to a collective one. Much of this shift was responsible for architecting and setting the agendadue to the thinking of Mike Markovits, vice presi- for change. His sixteen senior vice presidentsdent of business and technical leadership. Mike (SVPs) were responsible for identifying significanthad been a career HR professional at GE, working enterprise-integration imperatives. The role ofacross various businesses and alternating among the I&VT collective (the 300 or so members) wasHR-generalist, leadership-development, and to lead the enterprise imperatives at the execu-change-management responsibilities. He had tive level, while IBM managers (30,000 or so) wouldalso led leadership education at Crotonville. His lead the change at the level of day-to-day opera-mandate at IBM was to think fresh, build on the tions and enlist the other more than 300,000 IBMalready rich heritage, and take it to the next level. employees to identify what is needed to move theMike explains, ‘‘I didn’t come in to create this enterprise. It was a theory of progressive engage-leadership initiative. It was something we figured ment, with a steady build of ownership. 17
  18. 18. Oliver Wyman Leadership Development Deploying senior executives to drive integration and values Sam Palmisano’s enterprise-change agenda contained approximately fifteen critical initiatives. These were items that kept the chairman ‘‘up at night’’ and were considered mission critical. They became the backbone for the leadership development initiative at the executive level. The idea was for the top three hundred to spend time working on these most critical challenges to deliver on the promise of ‘‘one IBM.’’ The enterprise nature of the projects would force participants to broaden their perspectives. Palmisano said, ‘‘I’m really trying to get more people at IBM to think like me. They need to let go of their identity as an HR person, a SW [software] person, etc. and begin to think of the whole—the one IBM.’’ Once the three-hundred members of the I&VT had been selected, IBM launched and chartered its first action learning group of twenty- five to thirty executives to address one of the mission-critical initia- tives: Client Value. Additional action learning teams later would be launched to address initiatives such as Enable Cross-Enterprise Integration, Win SMB, and Enable the Globally Integrated Enterprise. Since these initiatives were part of an overall change agenda, the timing and scope of each launch were dictated by a critical path and a set of project prerequisites and dependencies. I&VT initiatives: A process overview The action learning experience was built around a four-phase I&VT process: launch, discovery, recommendations, and implementation. In the launch phase, participants received their mandate directly from Palmisano. They were given a draft charter that they discussed and debated during the first two days. They could go back to their executive champion and seek to modify their charter if they wished. If the changes were significant, Palmisano had to sign off on the new changes. The teams then produced their work plans for attacking the problem. These had to be approved by the champions. Then the groups began building their teamand setting their development agenda. In the discovery phase, participants interviewed the various18
  19. 19. The shifting paradigm of executive leadership developmentstakeholders. They traveled outside IBM and anecdotal basis, in the individual performanceexamined best practices and market data. During evaluation process.the recommendation phase, the teams consoli-dated their learnings and developed a recom- I&VT member self-assessmentmended course of action. This phase culminated At the end of each year, the HR SVP sends a self-in a presentation and dialogue with the chairman assessment consisting of five questions to everyand team. These first three phases typically lasted I&VT team member (see Exhibit 1.1). This self-between four and six months. The final phase, assessment is an input as to who continues to beimplementation, involves ensuring key stakeholder on the team and who is removed. A member whoownership and support, transitioning responsi- is removed may be invited back in the future, butbility to line owners, and maintaining ongoing it generally is not perceived as a positive outcome.accountability for implementation of the variousrecommendations. This responsibility could lastfor years. Exhibit 1.1 I &VT Member Self-AssessmentThroughout the first three phases, members „„ Describe one to two substantive actions that you’vealso participated in team and individual assess- personally driven to more effectively integrate IBMments and coaching. For example, in preparation this year.for the launch, participants take online assess- „„ Describe one to two actions that you have taken toments including a 360-degree feedback survey. increase diversity for IBM and/or your organization,They receive one-on-one feedback during the e.g., executive diversity—US Minorities and Womenfirst week of the process and then contract with WW, Diversity Network Groups, Mentor Relation- ships, etc.their consultant to help them on two or threeleadership competencies of their choice. There „„ Describe one to two key successes you have had this year with your partnership accounts, e.g., revenueare checkpoints and feedback opportunities along growth, key meetings, critical situations resolved, etc.the way. At the end of the four months, they have „„ Describe one to two actions that you have taken toone follow-up meeting with a consultant. In some build a performance oriented culture, e.g., climate/cases, the consultants and the initiative members culture improvements, MIS, IDPs, etc.have maintained their coaching relationship. „„ Describe one to two incidents where you have modeled the behavior of leading by the Values.Even when members of the I&VT are not actively Source: IBM. Used with permission.assigned to an initiative (there are only twenty-five to thirty members of an active team at agiven time), they are expected to provide counsel Other assessmentsand support to their peers on the current action The consultants who offer process consulting tolearning team. Observational data on these assists the teams also provide observational data on teamare tracked, noted, and included, albeit on a more members regarding their individual participation 19
  20. 20. Oliver Wyman Leadership Development and performance within the learning teams. Mike explains: ‘‘The team process is an incredible window to watch people in action. There is no hierarchy, as it’s a group of peers. So they have to estab- lish their own leadership structure to support the work. It is inter- esting to see who wants to play leadership roles, who are asked by peers to play leadership roles. The most interesting variation is in the domain of thought leadership—who really has a compelling idea and is able to carry the day with their influence. Collaborative influence became something we watched carefully. While people do not get graded, we have a clear idea of who are the high, medium, and low contributors. That information is funneled through the succession- planning process to Palmisano.’’ Reinforcing and rewarding the expectations In order to support and reinforce the I&VT initiative, IBM has put in place a chairman’s I&VT bonus (a noteworthy amount) for which the team members are eligible. Criteria for receiving the reward include demonstrated evidence of breaking barriers and teaming across IBM, modeling the leadership behaviors for integration and the IBM values, and contribution beyond the scope of the I&VT member’s official job role. In addition, participants know that their behavior and perfor- mance on the team are being observed, and these assessments will be fed into the performance-management and succession-planning systems. Finally, I&VT initiatives are well communicated throughout the organization. In his company Webcasts, Palmisano discusses the role of the I&VT as a key lever for change. I&VT initiative members are asked to present at company leadership development programs and discuss what they have learned as leaders by going through the process. Desired outcomes The I&VT initiatives are chartered to accomplish specific business results, with a pragmatic emphasis on outcomes. Two measures are used to determine success. The first is the business project results: increased revenues, cost savings, process improvements, and so forth, depending on the nature of the project. These are identified in20
  21. 21. The shifting paradigm of executive leadership developmentthe initial team launch and the chartering process, The program approachand the outcomes are approved by the project For this new generation of executive developmentchampions and Palmisano prior to the official initiatives to have an impact, their designs andlaunch of a team project. The second measure of content must be highly customized. Mike describessuccess is the development of a cadre of leaders how critical this element of customization is to awith an enterprise perspective, leading enterprise successful outcome:changes consistent with IBM values. This outcomeis measured though behavioral assessments, I had been at General Electric for twenty years, and I’dobservational data (the sources are Palmisano, his been warned that you have to understand your context.senior team, and Mike’s team), and participant In other words, you can’t simply take best practices from GE, plop them into another context, and expect themself-assessments. to work. Having worked extensively with action learning courses at GE, I thought their designs were very effec-Because the projects are the real work of tive. But IBM’s culture and business are different. First,promoting change at IBM, it was recognized that many of our senior leaders are responsible for closingtangible outcomes may take a year or more to our biggest business deals, unlike GE. So there’s nofully tally in terms of the business results. In fact, way we can take even one of these three-hundred IBM executives and lock them in a room for three weeks.project recommendations from the third quarter Without them out with clients, the business wouldof 2006 are still being implemented to this day, be brought to its knees. So while GE routinely takesgiven the far-reaching nature of the changes executives off-line for three-week projects, we ended upproposed. Hence, although IBM can see benefits, designing involvement in the I&VT as something execu-it cannot begin to quantify the results over the tives did in parallel with their real jobs.short term. Mike explains: ‘‘This is something that Second, while GE is very good about top-down execu-was unanticipated. At General Electric, we would tion, IBM is a less directive and more participative andhave a three-week action learning experience, and collaborative culture. This means that a lot can happeneverything was wrapped up with a presentation in between a chairman’s approval of an initiative andto the chairman. Then the recommendations were final implementation of it. Understanding this, we deter-passed along to line management. In contrast, our mined that the team’s work could not conclude at theteams at IBM are theoretically never terminated. point of making recommendations. The teams would have to stay involved throughout the implementationMany of their recommendations involve changing phase to ensure that recommendations materialized intothe culture, and that doesn’t happen overnight. concrete actions.The first team we launched still meets occasion-ally to take stock of the status of the implemen- Third, Palmisano wanted to cultivate a much moretation of their recommendations and to act as sophisticated understanding of the external market-a guide to line managers involved in the actual place. So we wanted a process that didn’t rely on the information in people’s heads. The business requiredimplementation. They make certain that the robust insight into customers’ changing needs andoriginal intent of their efforts is not lost.’’ the opportunities for IBM to address them in a more 21
  22. 22. Oliver Wyman Leadership Development coordinated way. Therefore, we designed a process that allowed time to collect new and fresh market perspectives, thoroughly analyze the data prior to recommendations, and think deeply about implementation and change issues. This eye toward deeply understanding the organization, its history, and what this meant for designing an effective intervention also led Mike and his team to design a somewhat surprising kickoff course module on the topic of ‘‘hope.’’ Although this was not a traditional offering in content-design menus, it seemed essential to address at the beginning of this process. Mike expounds on this design choice: The topic of organizational change can be a loaded one for people. Some executives had witnessed or been a part of unsuccessful change efforts in the past, and this accumulated experience can really close the window of what someone believes is possible. When you are asking for ideas and recommen- dations, you can end up with an underlying level of pessimism and cynicism that is a profound barrier to change. So we addressed this head on with the topic of hope, and the notion that it is an attitude that can be chosen. We discussed how discouragements and defeats can either immobilize us or make us more resilient. We encouraged people to reconnect with personal stories of something they had wanted when they were young and how they went about getting it. The goal was to instill a sense of personal power to make change while also managing their internal motivations and expectations. As readers will discern from Mike’s last comment, he was able to leverage individual-leader learning as a vehicle for collective learning, blending the older model of individual development with the newer frame. Another content issue the design team addressed was strategic risk taking. The near-death experience that IBM went through in the mid- 1990s was a scarring experience—a significant emotional event that had a continuing impact on the behavior of IBMers. When the design team looked at the set of leadership competencies, this dimension was the weakest. It was critical to address risk aversion head-on because of the need to source breakthrough ideas, not incremental plans, for the enterprise initiatives. So in the beginning, Palmisano chartered the teams with the clear expectation that they were to generate bold ideas. Throughout the action learning process, the22
  23. 23. The shifting paradigm of executive leadership developmentSVPs assumed responsibility to ensure that aspira- that was unanticipated, and the design team hastional ideas were generated. adjusted its expectations about timing based on learning along the way. Mike describes the change in thinking:Organizational development skillsAll organizational development and organizational At first, we really wanted to get as many people througheffectiveness resources of IBM already reported to the process as possible. But, that was thinking more likeMike. In fact, this had been one of the reasons the a traditional training program. Once we realized theserole was so attractive. Prior to launch, however, projects were about culture change and performanceMike realized that he needed to redeploy organi- improvement, with some leadership development sprinkled in, it slowed the pace. There is only so muchzational development and organizational effective- change the organization can stomach at a time. Hence,ness resources from business-unit-based projects the sequential fashion that we’re using to roll theseto work on these new enterprise initiatives in initiatives out.order to support the process. He also needed tobuild the consulting muscles of his team. So one of Careful pacing is a critical dimension of thesethe initial steps was to increase their capability in programs.the area of process facilitation so they could fullysupport the teams. The process has fostered new data collection, analysis, reflection, and fine tuning, and theEach of the action learning teams had three to four analytical rigor of the team recommendationsconsultants to support the discovery and learning has been strong, especially around critical stake-process as well as the leadership development holders. Mike noted: ‘‘In general, most of ourcomponents. The consultants were not content teams have spent a lot of time with clients, andexperts chartered with providing answers or this source has had the most significant influenceadvice to the team; rather, they provided coaching on the recommendations. They have additionallyand process-facilitation experience. They provided spent time with employees. As recommendationsconsulting on-the-fly, offering real-time interven- became more formulated, they also spoke to keytions with the teams at the individual, team, and stakeholders, both internal and external.’’executive levels. In addition, the market research function and other parts of IBM have all been available to theTiming and resources teams for whatever support they needed. TheIBM is still implementing recommendations market intelligence group has tended to get tappedfrom its action learning team chartered in the for every initiative. The teams could commission newthird quarter of 2006. The plans have been so analysis. In addition, IBM has its own consultingfar-reaching that it will take years to quantify function, Global Business Services. Some of thethe results. According to Mike, this is something teams commissioned new studies from this group or 23
  24. 24. Oliver Wyman Leadership Development went outside to hire external consultants, speak with experts at univer- sities, and so on. How were these market-research efforts funded? As Mike puts it, ‘‘HR did not fund these initiatives. The business funded them. In addi- tion to all of the previously mentioned IBM resources being available, these executives are big people, with big jobs and big budgets. In the event they needed travel and out-of-pocket expenses to fund their data analysis and market research, they came up with the money out of their own budgets and made it happen without any additional funds.’’ This point drives home the critical importance that support from the senior-most executives takes multiple forms and is essential for these initiatives to move beyond simple action learning projects. Governance Palmisano sponsored the entire I&VT effort. He chartered each team, made himself available to the teams throughout the process of analysis and recommendations, and then acted as a coach to the teams prior to the presentation of their recommendations. At each team’s initial kickoff meeting, he shared many of his views about its particular issue or challenge. In between, some teams availed themselves of Palmisano’s input, while others chose not to engage him prior to the prerecommendation meeting. At the prerecom- mendation meeting, Sam provided coaching, particularly about the challenges the teams would encounter when they presented their recommendations. According to Mike, Palmisano often coached by asking questions. In doing so, he was modeling a specific leadership behavior for his executive team. Mike illustrates Palmisano’s approach: A typical set of coaching questions and discussion with Sam might be as follows: ‘‘SVP so-and-so is going to struggle with this idea. He might view it as inconsistent with his view on the market. How do you think you could get him on board?’’ Then the team would have a group discussion with Sam and determine how to better prepare for the presentation. Typical coaching themes24
  25. 25. The shifting paradigm of executive leadership development included how to gain organizational acceptance for an „„ CEO sponsorship is essential. Palmisano’s deep idea, appreciating the roadblocks and barriers associated commitment to and engagement with the with some of the recommendations. He would help the process has been crucial. teams think about the organization’s realistic appetite for change and the appropriate phasing (how much/ „„ When transformational change is the goal, with how fast), and so forth. Sam didn’t see his role as one of leadership development as an integrated outcome, providing answers; rather, he facilitated the team’s own organizations may have to slow the pace of their thinking and acted as a role model. He was very mindful of how to encourage enterprise-wide thinking and to effort. It’s not about efficiently ‘‘sheep dipping’’ use these forums as a vehicle to effect the key mind-set the executives through a program. It’s about shifts required in the business. discerning the scope and rate of change that the organization can successfully digest. PacingEach of Palmisano’s direct reports, the SVPs, was is critical, according to Mike: ‘‘The thinking …assigned as a team champion. Each initiative had is that IBM is still digesting the five initiativestwo SVPs assigned to it. Sam selected the SVP already begun. We know the next initiativechampions, with guidance from Mike’s team. Mike’s needs to be smaller and more focused. We’veteam, which was working with the initiative teams realized it’s a great tension point in the designon an ongoing basis, would coach the SVPs on how of these efforts.’’to engage the teams at the start, notify them of the „„ You have to be very strategic in the use of outsideareas they needed to press the team on, and other- subject-matter experts. If the teams perceive thatwise help the SVPs to promote a healthy dialogue the faculty is taking time away from the busi-and team progress. In particular, the SVPs’ biggest ness or that they have to put project progresschallenge was to balance the tension between feasi- on pause, then they will resist the outsidebility and aspirations without dampening the team’s resources. It is critical to construct the righthopes and enthusiasm. conditions for these individuals to provide value. IBM learned that these external resourcesUseful lessons from IBM need to be tightly integrated into the initiativeThe transformation process is still ongoing at IBM. design and delivery. Their content must be seenMike and his team, in addition to everyone else as integral to the projects.who touches the I&VT process, continue to learn, „„ The HR, LD, and OD support required for executive-and the design is revised accordingly. Many of the led change efforts and in situ learning looks verylessons learned from the IBM experience are gener- different from those required to support a more typicalalizable to the new generation of executive lead- three-day program. Specifically, a deep under-ership development approaches. As you consider standing of how to facilitate large-scale changemoving your own initiatives toward a more collec- and strong process facilitation and coachingtive and enterprise focus, some of the important skills are critical success factors for these initia-lessons to remember include the following: 25
  26. 26. Oliver Wyman Leadership Development tives. Organizations that lack these internal skills may need to rely on external suppliers for their deeper experience base and cred- ibility with senior-level leaders. „„ There is a need for a common nomenclature and set of models regarding change. In the case of IBM, the organization already had a change model—a clear sense of process and language to rely on. In addi- tion, Mike and his team socialized a model of organizational change that senior leadership used widely. Without this accepted standard, a critical capability gap would have to have been filled. „„ The launch of the initiative teams must be supported by a degree of readi- ness on the part of the larger organization. Mike recalls, ‘‘When we launched our first one, my team was in good shape, but the rest of the organization didn’t really understand, appreciate, or know how to support the initiative process. It had never been done before. So senior leaders, members of the initiative teams, and their team members didn’t know what to expect. We also hadn’t thought about how to alert the organization about what this new respon- sibility would involve. By the second time, we brought in past participants within the first week to help the new participants know what to expect.’’ „„ Degrees of individual, team, and organizational change will vary over the process. In the beginning (the first half of a project initiative), the mix of emphasis on change by level was probably 40 percent indi- vidual, 40 percent team, and 20 percent organizational learning. Then the mix switched quickly to 20 percent individual, 20 percent team, and mostly (60 percent) organizational change. There was a scaffolding quality to the change process. „„ A key challenge is to allow and reinforce learning at multiple points throughout the experience. Particularly important is the creation of learning opportunities after a team project officially ends. For example, Mike and his team established retrospectives: structured opportunities where the teams come together and look at what’s happened or not happened since the project recommendations. Teams are asked to reflect on what they’ve learned about leading change on a collective and individual level. These are held at least26