Quality of leadership within a company helps meet the expectations of investors, customers, and employees, and sets the stage for growth, so developing the next generation of effective leaders is perhaps the most important undertaking of a forward-thinking company.
Based on recent research, here are six components that differentiate the top company approaches versus the less successful companies.
• Centralised efforts. Top companies centralise their management of talent. Top talent is owned by corporate not by a function, business or geography — the term is "corporate property." This simple logic makes a huge difference in the variety of experiences leaders have in top companies because businesses, geographies and functions can't deprive their best talent from moving across boundaries in order to optimise that organisation.
• Top executive involvement. If you want to develop leaders, you need to involve leaders. Former P&G CEO and now Chairman A.G. Lafley conducts his own senior leadership development programme. Lafley invites each participant to the programme personally. Members of P&G senior executive team teach, coach and mentor these leaders every month. In addition, these same senior executives sponsor the recruiting efforts at targeted universities.
• Focus on a few key processes. Top companies for leaders live by the precept of finding and hiring top talent vs. fixing and developing mediocre talent. If you hire great people, you are a lot more likely to find some great leaders. Once you've got the right talent in the door, you need robust performance management with lots of feedback. Finally, you need to expose these people to a variety of development experiences that build knowledge, perspective and skills.
• Make it a strategic focus. Top companies are never laissez faire about leadership development — they see the infusion and growth of talent as crucial to strategic success and they are unrelenting in their approach to building talent. Their leadership development is centralised and intentional about developing a series of experiences that build good functional leaders and general managers.
• Build leaders and leadership. Leadership capability increases as HR systems such as performance management, compensation and job assignments are linked across organisation boundaries, and are intentional about building the right kind of leaders. Most companies are primarily focused on building individual leaders through assessment of individual leader competencies and training and development to improve those competencies. Top companies for leaders also build robust leadership capability that supports a culture of integration and opportunity to develop from within.
• Create value for inside and outside stakeholders. Top companies develop leaders who have the desired competencies to deliver on their strategy and the competencies to ensure customer delight. Competencies are the means to deliver results and value to stakeholders not the end state of development. Top companies desire to build leaders not to just become better people, but to become better people who know how to provide value to employees, customers, investors and other stakeholders.
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