Identifying and developing leaders is the key human capital challenge of every company. So what is the Pathway to creating Leadership Excellence? Get the insights from the PI Worldwide Research
Identifying and developing leaders is the key human capital challenge of every company. So what is the Pathway to creating Leadership Excellence? Get the insights from the PI Worldwide Research Department for building your own strategy.
21stCentury Leadership:Building an Effective LeadershipDevelopment StrategyPI WorldwideResearch Department2013
2o Identifying and developing leaders is the key humancapital challenge of every company.o Leadership is the single most-researched topic in theorganizational sciences, with hundreds of studies andarticles published each year.o Companies with superior capabilities in the areas ofleader identification, selection and developmentconsistently outperform their peers on a variety ofoperational and financial metrics.The Importance ofThe Importance ofLeadership DevelopmentLeadership Development
3 40% of new executives fail within the first 18 months(Center for Creative Leadership). Leaders hired from outside the organization are twice aslikely to fail as those hired from inside (Ciampa &Watkins). Just 2% of organizations believe “they are doing a greatjob at developing leadership talent” (SIOP). Organizations today believe they are capable of deliveringonly two-thirds of the leaders that their businesses willrequire in the next three to five years. (Aberdeen) Nearly three-quarters of leadership teams fail to achievebusiness goals (Bersin by Deloitte).The Leadership LandscapeThe Leadership Landscape
4Research indicates the vast majority of “leader failure incidents”can be traced to two factors:1.Lack of Leadership Skills: Inability to facilitate change, build ateam, coach subordinates, etc.2.Lack of Interpersonal Skills: Inability to build and leveragerelationships, to communicate, to network, etc.Note that a lack of “technical” or “professional” knowledge is cited infewer than 10% of situations in which a leader fails.The Good News: These are skills, and skills can be developed overtime with consistent coaching and practice.Why Do Leaders Fail?Why Do Leaders Fail?
Some companies do a much better jobat developing leaders than do others.What do those companies do?
6 Align leader competencies with businessstrategies. Build the pipeline at all levels of leadership. Balance the “what” with the “how.” Practice makes perfect. Measure results.……in Shortin Short
7How do these companies developleaders more effectively?
8What are your company’s core beliefs and underlyingassumptions when it comes to talent management and leadershipdevelopment?For example: “All leaders should have the capacity to develop at leastone successor for their role.” “Individual leaders will have a variety of diverseexperiences to build breadth and depth.” “Leaders will stay in a role long enough to demonstrateconsistent, multi-cycle success.”The Leadership Strategy must align with the Business Strategy1. Develop A Strategy1. Develop A Strategy
9Companies with superior leadership developmentprograms analyze the external business environment ANDthe internal characteristics of the leaders themselves.Five key contextual variables:1. The position.2. The leadership group.3. The CEO or other immediate manager.4. The company culture.5. The country culture.2. Understand the Context2. Understand the Context
10The Key Question:What specific challenges will the person be facing, and what arethe competencies required to successfully meet thosechallenges? What is the strategic mandate? To what extent will the leader be able to shape the role innew, unexpected and value-added ways? What are the operational responsibilities? What is the level of decision-making authority? What is the scope/scale/size of organization? Change expectations (internal and external)?The PositionThe Position
11The Key Question:What are the characteristics of the people this person willbe working with?•The CEO/Immediate manager•Peers•Direct Reports Strategic priorities. Personality/work style. Expectations of the leader. Authority and support given to the leader.The Leadership GroupThe Leadership Group
12The Key Question:What type of organization will this person be working in? Business strategies. Historical legacies. Core competencies. Organizational structure. Competitive advantage. Norms (e.g. leadership style, decision-making,structure, speed, formality, etc.)The Organizational CultureThe Organizational Culture
13The Key Question:What type of country will this person be working in? Business norms. Social norms. Level of adjustment support. Tolerance of differences. Similarity to country of origin.The Country CultureThe Country Culture
14 Companies, and even business units within companies,have their own unique cultures. Successful leadership development efforts do not existin a vacuum – they “fit” the culture in which they occur. “Poor organizational fit” is a leading cause of new CEOturnover (Oracle). Understanding the corporate culture will help definewhat the “right” leadership style(s) look like for anorganization.3. Respect the Culture3. Respect the Culture
15 Develop, communicate and live by a commonleadership model. This common model should provide the standard forthe identification, assessment and development ofleadership talent across the enterprise. What does a successful leader here look like – what arethe expectations? For example: “Intellectual Curiosity: Sees thepossibilities; willing to experiment; cultivates newideas; comfortable with ambiguity and uncertainty.”4. Build the Model4. Build the Model
16 Successful leadership development programs aredata-driven, as opposed to being influenced byhearsay, personal feelings and anecdote. Companies can pool and analyze aggregate data tomake predictions about leader performance (Bersin).5. Work the Data5. Work the Data
17 Focus on two or three key leadershipdevelopment initiatives and execute superblyagainst those, as opposed to trying tosimultaneously work on many programs atonce. It’s not about the forms – it’s about thedialogue and the process.6. Keep it Simple6. Keep it Simple
18 Today’s executive is evaluated on a muchbroader range of criteria than purely thefinancial results that he or she delivers. Companies are recalibrating the balancebetween results such as income, profitabilityand stock price and the process by whichthose results are achieved.7. Find the Balance7. Find the Balance
“The most important responsibility that all ofus have is to develop the leaders of thefuture. It’s the greatest challenge that wehave, and the most important legacy that wecan leave behind.”William C. WeldonFormer Chairman and Chief Executive OfficerJohnson & Johnson