05 Jul Developing A Leadership Pipeline That Works
One lesson that you learn reasonably early in life is that if you need to be somewhere at a specific time, and you know roughly how long it will take to make the trip to your destination, it is important to begin the trip on time. No combination of speeding or looking for shortcuts enables you to get there on time if you’ve left 15 minutes or a half-hour late.
For the last decades there have been warning voices about the high percentage of corporate leaders who were in their late 50’s or early 60’s. Then came the recession of 2008 to 2012. Many corporate managers and executives postponed retirement because they had lost a sizable percentage of their personal wealth and needed to continue working purely for financial reasons.
At the same time, their companies pulled back on hiring. Younger people were not added to the payroll as their firms continued to tighten their belts. Normal movement among managers and executives nosedived as these leaders hunkered down in their current position rather than taking the risk of being out of work during the recession years.
These factors have now come together to create a perfect storm. The impending retirement of senior leaders is not a new phenomenon; but it now has a heightened importance to every organization. The need to create a pipeline for leaders is now at an all-time high. While it has always been an important issue, it is now extremely urgent.
The leadership pipeline is used to create a more systematic, visible system of identifying candidates for succession, combined with the processes for their development. I would like to propose several key elements that define a successful workplace pipeline:
1. A simple, non-bureaucratic system. The more complex the system, the more likely it will fail. If the process stakes out too broad of a scope of operation, it will fail. On the other hand, if it limits itself to the top 50 to 200 people in the firm, its chances of success go up.
2. The pipeline is owned by the senior leadership team. Evaluating a person’s leadership talent and potential is too important to be left to any one person. No single leader should make or break someone’s career. That is why the part of the pipeline that leads to senior management assignments, should be owned collectively by the senior team. This provides more than one coach for every aspiring leader.
3. Managers become significantly more involved in people development. Some organizations bring in outside consultants to work with their leaders and create processes by which they receive candid feedback on their performance. It often comes to light that this candid, specific performance feedback is some of the first that these key individuals have received in the past several years. At least 2/3 of the leaders we interview indicate that they want more coaching and feedback than they currently get. Managers need to be trained to offer more feedback and do it in a positive, constructive way. The involvement of managers is one of the key ingredients in successful leadership development outcomes.
4. The greatest pay-offs from a good competency model are its ability to predict future success and to aid in the development of leaders. The performance appraisal, by definition, is a look in the rear-view mirror, and focuses solely on past behavior and results and does not take into account the demands of a new job or of the future. Competencies, while they are highly correlated with a manager’s ability to obtain good results are also selected for their ability to predict effective performance in the future and at higher levels.
5. Pipelines rely on multiple inputs. One key to keeping the pipeline filled is to involve a greater number of people in the development process. Allowing people to nominate themselves to participate is one way to increase the input. Offering development at all levels in the organization, and picking up leaders in the earlier stages of their careers are other ways of insuring an adequate input.
A leadership pipeline is more than turning a valve and hoping something will gush out. The pipeline demands the right culture in which to flourish. It takes time to build and to fill. We strongly encourage organizations to begin now to take the steps that will provide them with an adequate supply of strong leaders.