Next Generation Leaders: Small, Medium and Large

Next Generation Leaders: Small, Medium and Large

by Daniel R. Tobin | Talent Management

 

With the pending retirement of the baby boomer generation, companies of all sizes are rightly concerned with who will fill senior executive positions and how they can develop their next generation of company leaders.

 

Half a century ago, Lawrence J. Peter wrote The Peter Principle, which stated: "In a hierarchy, every employee tends to rise to his level of incompetence." That is almost universally true - if we have an employee who is doing a great job, we tend to promote him or her into management. If that employee does a great job as a first-level manager, we promote him or her to become a manager of managers. We keep promoting that employee until he or she reaches a level where he or she isn't doing such a great job, and then we leave that employee there doing a fair to poor job, or we hire him or her. The antidote to the Peter Principle is to prepare employees for the next level of jobs, rather than bemoan the fact that they aren't already.

 

Leadership development comes in all shapes and sizes, however. Associated literature is full of program examples from large organizations. General Electric stands out as a company with an excellent reputation for growing its own leaders, as well as growing leaders who then leave and become CEOs at other large companies. But few midmarket companies - with 1,000 to 5,000 employees - have the equivalent staff or monetary resources to invest in a GE-style leadership development program. Fortunately, the size of a company doesn't really matter; every company can and must invest in developing its next generation of leaders if it is to prosper, or even survive, in the near- and long-term future.

 

Imitated and Duplicated

 

Here is a proven model for a leadership development program (LDP) that midmarket companies can use to prepare the next generation of leaders. The model has four components:

 

1. Formal education sessions of two to three days each:

These can be held once a quarter over a period of one to two years. Topics are chosen by company executives from three basic categories: leadership skills, business acumen and execution skills. Many companies have sent high potentials to solid leadership development programs at well-known business schools or other leadership education vendors only to find leadership skills alone do not make a leader.

 

Along with leadership skills, companies must build business acumen in high-potential future leaders to broaden their focus from functional or technical specialties to a holistic understanding of the company's business. They also need to develop high potentials' execution skills because even the greatest vision will not benefit the company unless the company's leaders can execute on that vision.

 

2. Action learning projects:

Assigned to individual participants or teams of participants, these should follow each education session to help reinforce learning. These projects also allow companies to test participants' skills before promoting them.

 

3. Individual development plans:

These focus on the unique development needs for each LDP participant beyond what will be covered in the formal education sessions. Plans should be based on a 360-degree assessment of each participant and written in consultation with the participant, his or her manager and an assigned human resources staff member.

 

4. Mentoring and coaching:

These programs complete the model. Mentoring is a way to transfer knowledge from current executives to the next generation. It also allows mentors to develop a more complete picture of each LDP participant's capabilities. Coaching, using internal or external coaches, can fill developmental gaps in the individual that aren't being addressed in the LDP agenda.

 

Not every company will be ready to invest in the full model. Due to budget constraints, some companies may not be able to hire external coaches, others may lack staff to support individual development planning, and others may lack executive support for mentoring programs. While the third and fourth elements can be valuable, the combination of education sessions and action learning projects will get companies off to an excellent start. Other elements can be added when funds become available or when current executives start recognizing the value of the LDP.

 

Alternative Leadership Development Models

 

There are other LDP models. Some companies contract with a university business school to put selected employees through an intense week of training that covers a number of topics ranging from marketing and finance to strategic planning and leadership skills. These programs are taught by professors and typically include team projects that are presented to a panel of professors and company executives at the end of a weeklong program.

 

There are several disadvantages to this model:

 

1. Information overload:

There is simply too much information being transmitted in too short a period of time. While the topics of instruction are all worthy, there is no opportunity to start using what is learned before being swamped by more information on another topic. Education sessions that focus on a single topic and are followed by an action learning project can help participants use and retain the knowledge they receive.

 

2. Non-company-specific material:

Many business school professors use material from their regular classes and do not take the time to learn about an individual company or to customize the material for specific challenges the company faces. Further, faculty may have no particular expertise or experience in the participants' industry, and when case studies and examples in these programs come from companies in different industries that have no relevance for participants, interest can be low.

 

When learning tools are relevant to the industry, participants can more easily identify with the examples and start thinking immediately about how they apply them to their own company and situations. In the LDP model, learning leaders select faculty - business school professors, consultants, training vendors or even a company's own executives - and can work with each faculty member to customize material to the company's specific challenges.

 

3. Limited visibility:

If company executives are involved in the business school program, they typically fly in to hear team presentations on the last day. They will not have the time or opportunity to really get to know participants or to see them in action. With the LDP model, company executives will have many opportunities to interact with participants by acting as instructors, speaking at education sessions and reviewing action learning projects. This level of executive involvement with LDP participants provides greater visibility and motivation for the participants and gives executives more personnel knowledge of the company's high potentials, which will yield benefits when it comes time to do talent reviews and succession planning.

 

4. Fewer opportunities to build networks:

Because the participants are working so hard during this week, they will have few opportunities, outside of team assignments, to get to know each other and build internal networks. These networking opportunities are valuable for participants in their current positions, and they can prove even more valuable when they are promoted and already have cross-functional networks in place. It takes more than a week to build relationships. With the LDP model, participants get to know each other, work together and build trust over a longer period of time.

 

5. Expense:

A one-week business school program can be expensive. Learning organizations pay for a professor's time as well as the business school's overhead. Often fees charged for a one-day session at a school can be three times what it would cost to directly hire the professor to teach in a company's LDP.

 

A second common alternative to the LDP model is to send a few selected individuals to a leadership development workshop at a business school or at a leadership education provider. This is most common in smaller companies where the pool of high potentials is too small to justify investment in the full LDP model.

 

Compared with the LDP model, there are several disadvantages to this approach:

 

1. No matter how good the program, one week of training does not make a leader.

Participants must use what they learn in the program to improve their current job performance and demonstrate that they are ready for larger leadership positions. The LDP model covers multiple topics over a period of one to two years. The external program typically focuses on leadership skills, while the LDP model develops business acumen and execution skills as well as leadership skills.

 

2. The external program typically has no follow up or follow through.

Using the LDP model, participants start using what they learn immediately through action learning projects.

 

3. The external program is likely to be generic in nature.

Because the program will include participants from many companies and industries, it cannot be tailored to any one company's needs. With the LDP model, all content can be focused on specific industry knowledge and company challenges. Further, because the participant likely is attending alone, there is no opportunity to discuss company-related ideas with fellow employees or to build internal relationships.

 

While there are many excellent programs available, a company should expend the effort to plan an appropriate LDP experience and follow up with the participants to ensure the experience has value for both them and the company. If leaders choose to follow this route, there are some basic steps that can help ensure both the individuals and the company get the best value from these programs:

 

1. Meet with the participants before the program to review the company's expectations for participant learning and what changes in knowledge, skills and behavior are expected following completion of the program.

 

2. Debrief the participants immediately following the program to match expectations with the actual experience. Set up an action plan to identify what is expected of participants now that they have completed the program.

 

3. Follow through on the action plan with regular reports and feedback.

 

 

[About the Author: Daniel R. Tobin is a consultant, coach and author of Feeding Your Leadership Pipeline.]