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A business is only
as good as the
people who lead it. If
a business improves,
it’s generally because
the leaders improve.
When a business is
stagnant or declines,
often the leaders
have not improved.
Unlike fine wine,
leaders do not natu-
rally get better with
age.
One of the reasons a
leader’s performance
may not continue to
improve is due to a
lack of development.
Less than 1 percent
of worldwide corporate learning and development
expenditures are allocated to the executive level. As a
leader’s responsibilities and influence on the success
or failure of the business increases, their develop-
mental support decreases, and in many cases, disap-
pears altogether. Those companies that forego devel-
oping their executives beware: the top 15 percent of
investors in leadership development outperformed
the bottom 15 per-
cent in market capi-
talization growth by
85 percent over a ten-
year period. Failure
to properly develop
senior executives will
likely result in failure
to meet your financial
goals.
A second reason
leaders don’t improve
may be the develop-
mental initiative it-
self. Despite research
showing that the top-
ranked human capital
priority is leadership
development, a
whopping 93 percent
of senior leaders do NOT believe their companies
are effective at developing leaders. While the lack of
efficacy can be attributed to the quality or delivery of
content, it’s imperative that the most important type
of content is mastered.
While leaders need to be equipped with a host of ca-
pabilities ranging from business acumen to emotion-
Are You
Getting Better?
By Rich Horwath
2
al intelligence, their key challenges tend to cluster
in one area. A survey of more than 4,000 executives
on the top challenges of senior leaders showed the
following top five:
1. Allocating resources in a way that really
supports the strategy.
2. Ensuring day-to-day decisions are in line with
the strategy
3. Quickly translating strategic and operational
decisions into action
4. Setting a clear and differentiating strategy
5. Communicating the strategy and getting buy-in
These top challenges illustrate the fact that today’s
leader must be strategic. Being strategic means
that a leader can coalesce insights into differ-
entiated strategies that deliver superior value to
customers. It means they can concisely and con-
sistently communicate these strategies to others.
And it means they have the ability to champion the
strategies throughout the organization by influ-
encing the thinking and behaviors of others. Boris
Groysberg, associate professor at Harvard Business
School, summarizes his research with the same
findings:“One theme that
ran through our findings
was the requirements for
all the C-level jobs have
shifted toward business
acumen. To thrive as a
C-level executive, an
individual needs to be a
good communicator, a
collaborator and a strate-
gic thinker.”Additionally,
The Corporate Board of
Directors Survey showed
that the #1 trait of active
CEOs is strategic expertise. As Indra Nooyi, CEO of
Pepsi said,“To me, the single most important skill
needed for any CEO today is strategic acuity.”
One method leaders can explore to develop their
strategic capability is coaching. High performers
in sports, music and acting have traditionally used
coaches to enhance their skills. Even non-tradi-
tional areas like medicine have seen the value of
coaching to improve performance. Renowned sur-
geon and professor Atul Gawande commented on
the value of the coaching process when he came to
the following realization:“I’d paid to have a kid just
out of college look at my tennis serve. So why did I
find it inconceivable to pay someone to come into
my operating room and coach me on my surgical
technique?”Dr. Gawande’s insight demonstrates
that high performers in intellectual fields don’t of-
ten consider coaching because of the very fact that
they are high performers in an intellectual field.
People often look at highly successful leaders and
assume they are just naturally more talented than
others. This is generally untrue. As research by
professor Ericsson has shown, higher performance
in all walks of life is a product of effective, delib-
erate practice toward a goal. A coach can provide
a thoughtful practice regimen through dialogue,
development and direction. While many assume
that leaders like Steve Jobs (Apple), Eric Schmidt
(Google), Alan Mulally (Ford), and Jack Welch (GE)
were just better than others, the fact is that they all
had advisers or coaches supporting their growth.
A coach provides an exec-
utive with the opportunity
to dialogue openly on key
business issues, allowing
for reflection, questioning
and attitude formation.
Without this dialogue,
these outlets are missing.
Strategy coaching pro-
vides a one-to-one forum
for executives to enhance
their leadership perfor-
mance. Using feedback and
on-the-job application of new ideas, executives
can“think out loud”about key issues, tap into an
unbiased sounding board and develop new stra-
tegic capabilities. With an external coach, they
can consider changes in their business model or
the launch of a disruptive innovation without the
The Corporate
Board of Directors
Survey showed
that the #1 trait
of active CEOs is
strategic expertise
3
worry of how this would sound to their internal
colleagues. As professors Cossin and Metayer write,
“In a world where business models are evolving
rapidly and new competitors can emerge almost
overnight, strategic thinking--especially at the top
of the company--is more important than ever to a
company’s survival.”
If you want to improve your business, begin by im-
proving yourself. Start your developmental journey
by answering the following questions:
1. Which competencies/skills did I significantly
improve last year?
2. What developmental activities led to those
improvements?
3. What are my top three business goals for this
year?
4. What are the key competencies/skills I need to
improve to help achieve those goals?
5. What is my plan for improvement?
The next time you open up a nice bottle of Caber-
net Sauvignon before dinner, admire the color and
savor the bouquet. Swirl it around the glass. Take a
sip. The wine has improved with age. Have you?
Rich Horwath is the CEO of the Strategic Thinking Institute where
he has helped more than 50,000 leaders around the world develop
their strategic thinking capabilities. Rich is the author of the new
book, Elevate: The Three Disciplines of Advanced Strategic Thinking.
He is a New York Times and Wall Street Journal bestselling author
on strategy and has appeared on ABC, NBC and FOX TV. Sign-up to
receive your free copy of the Strategic Thinker newsletter by visiting
www.strategyskills.com

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Are You Getting Better

  • 1. A business is only as good as the people who lead it. If a business improves, it’s generally because the leaders improve. When a business is stagnant or declines, often the leaders have not improved. Unlike fine wine, leaders do not natu- rally get better with age. One of the reasons a leader’s performance may not continue to improve is due to a lack of development. Less than 1 percent of worldwide corporate learning and development expenditures are allocated to the executive level. As a leader’s responsibilities and influence on the success or failure of the business increases, their develop- mental support decreases, and in many cases, disap- pears altogether. Those companies that forego devel- oping their executives beware: the top 15 percent of investors in leadership development outperformed the bottom 15 per- cent in market capi- talization growth by 85 percent over a ten- year period. Failure to properly develop senior executives will likely result in failure to meet your financial goals. A second reason leaders don’t improve may be the develop- mental initiative it- self. Despite research showing that the top- ranked human capital priority is leadership development, a whopping 93 percent of senior leaders do NOT believe their companies are effective at developing leaders. While the lack of efficacy can be attributed to the quality or delivery of content, it’s imperative that the most important type of content is mastered. While leaders need to be equipped with a host of ca- pabilities ranging from business acumen to emotion- Are You Getting Better? By Rich Horwath
  • 2. 2 al intelligence, their key challenges tend to cluster in one area. A survey of more than 4,000 executives on the top challenges of senior leaders showed the following top five: 1. Allocating resources in a way that really supports the strategy. 2. Ensuring day-to-day decisions are in line with the strategy 3. Quickly translating strategic and operational decisions into action 4. Setting a clear and differentiating strategy 5. Communicating the strategy and getting buy-in These top challenges illustrate the fact that today’s leader must be strategic. Being strategic means that a leader can coalesce insights into differ- entiated strategies that deliver superior value to customers. It means they can concisely and con- sistently communicate these strategies to others. And it means they have the ability to champion the strategies throughout the organization by influ- encing the thinking and behaviors of others. Boris Groysberg, associate professor at Harvard Business School, summarizes his research with the same findings:“One theme that ran through our findings was the requirements for all the C-level jobs have shifted toward business acumen. To thrive as a C-level executive, an individual needs to be a good communicator, a collaborator and a strate- gic thinker.”Additionally, The Corporate Board of Directors Survey showed that the #1 trait of active CEOs is strategic expertise. As Indra Nooyi, CEO of Pepsi said,“To me, the single most important skill needed for any CEO today is strategic acuity.” One method leaders can explore to develop their strategic capability is coaching. High performers in sports, music and acting have traditionally used coaches to enhance their skills. Even non-tradi- tional areas like medicine have seen the value of coaching to improve performance. Renowned sur- geon and professor Atul Gawande commented on the value of the coaching process when he came to the following realization:“I’d paid to have a kid just out of college look at my tennis serve. So why did I find it inconceivable to pay someone to come into my operating room and coach me on my surgical technique?”Dr. Gawande’s insight demonstrates that high performers in intellectual fields don’t of- ten consider coaching because of the very fact that they are high performers in an intellectual field. People often look at highly successful leaders and assume they are just naturally more talented than others. This is generally untrue. As research by professor Ericsson has shown, higher performance in all walks of life is a product of effective, delib- erate practice toward a goal. A coach can provide a thoughtful practice regimen through dialogue, development and direction. While many assume that leaders like Steve Jobs (Apple), Eric Schmidt (Google), Alan Mulally (Ford), and Jack Welch (GE) were just better than others, the fact is that they all had advisers or coaches supporting their growth. A coach provides an exec- utive with the opportunity to dialogue openly on key business issues, allowing for reflection, questioning and attitude formation. Without this dialogue, these outlets are missing. Strategy coaching pro- vides a one-to-one forum for executives to enhance their leadership perfor- mance. Using feedback and on-the-job application of new ideas, executives can“think out loud”about key issues, tap into an unbiased sounding board and develop new stra- tegic capabilities. With an external coach, they can consider changes in their business model or the launch of a disruptive innovation without the The Corporate Board of Directors Survey showed that the #1 trait of active CEOs is strategic expertise
  • 3. 3 worry of how this would sound to their internal colleagues. As professors Cossin and Metayer write, “In a world where business models are evolving rapidly and new competitors can emerge almost overnight, strategic thinking--especially at the top of the company--is more important than ever to a company’s survival.” If you want to improve your business, begin by im- proving yourself. Start your developmental journey by answering the following questions: 1. Which competencies/skills did I significantly improve last year? 2. What developmental activities led to those improvements? 3. What are my top three business goals for this year? 4. What are the key competencies/skills I need to improve to help achieve those goals? 5. What is my plan for improvement? The next time you open up a nice bottle of Caber- net Sauvignon before dinner, admire the color and savor the bouquet. Swirl it around the glass. Take a sip. The wine has improved with age. Have you? Rich Horwath is the CEO of the Strategic Thinking Institute where he has helped more than 50,000 leaders around the world develop their strategic thinking capabilities. Rich is the author of the new book, Elevate: The Three Disciplines of Advanced Strategic Thinking. He is a New York Times and Wall Street Journal bestselling author on strategy and has appeared on ABC, NBC and FOX TV. Sign-up to receive your free copy of the Strategic Thinker newsletter by visiting www.strategyskills.com