Leadership training is a hot issue for not just HR professionals, but CEOs and executives at all levels. Melinda Finch considers the concept of effective leadership and looks at what HR professionals can do to bolster their organisation’s leadership capabilities
Leadership training is a hot issue for not just HR professionals, but CEOs and executives at all levels. Melinda Finch considers the concept of effective leadership and looks at what HR professionals can do to bolster their organisation’s leadership capabilities
If you ask most HR departments what their main issues are, leadership will most likely rank as one of the top five. In our 2005 study of the S&P/ASX top 100 companies, leadership in fact ranked as the number one issue. There are many other issues, such as recruitment and retention, productivity and performance as well as culture change – that can be all addressed by getting leadership right.
Great expectations
Effective leadership can be difficult to define because it encompasses so many aspects of human nature, professional skill sets and capabilities
However, being effective essentially means being good at what you do. And being good at leading means being able to listen and speak openly to others. It also means setting and meeting objectives and deadlines, giving clear directions and offering and setting an example of behaviour within an organisation. Good leaders can also accept and give constructive criticism and help colleagues identify and solve problems. They are able to delegate responsibilities, show understanding, handle conflict and recognise the contributions of others.
It’s a lot to ask. So it’s no wonder that a global report from DDI found that Australia’s top leadership talent have higher expectations placed upon them and are forced to do more with fewer resources. The report, Leadership Forecast 2005, revealed that 45 per cent of all leaders and 38 per cent of HR professionals believe that people expect too much of senior leaders.
“Against a backdrop of high profile ethical and accounting blunders and unmet performance expectations, senior leaders in Australia and overseas now find themselves firmly under the public microscope,”says Bruce Watt, managing director, DDI Australia. “With this scrutiny comes greater pressure that often leads to executive turnover and/or dropout.”
The study, which surveyed 4,559 leaders and 944 HR representatives from 42 countries around the world, including around 630 leaders and 110 HR representatives from more than 130 Australian organisations, also found that 24 per cent of leaders had considered giving up their leadership positions. The most common reasons this included a desire to redirect efforts toward other career goals (24 per cent) and a feeling that they are expected to do and accomplish too much (20 per cent).
The good, the bad and the busy
With the heavy burden of expectation upon many existing and aspiring leaders, learning and development support has become increasingly important. Fortunately, many organisations are giving it the full attention it demands. To this effect, recent research into the US corporate learning market found that the biggest percentage of training program dollars goes to management and leadership training.
A study by e-learning consultants Bersin & Associates found that 37 per cent of respondents rated it as a first or second priority. “These investments are fuelled by succession planning and the need to develop new and mid-level management talent,” the study of 1,200 business leaders found.
DDI also found that talent management has become a priority for leaders, with about 66 per cent of leaders rating it as a key business priority. This compares with just 44 per cent in 2001. However, “despite this shift in focus, Australian organisations are still providing little support or structured preparation for their leadership talent. Only 40 per cent of Australian leaders believe their organisation provides them with the things they need to develop while almost half (47 per cent) of all leaders surveyed are dissatisfied with current leadership development offerings,” the report found.
For HR professionals trying to bolster their organisation’s leadership capabilities, there are a number of options. “Building future leadership capability is typically a top three business priority for executives,” Watt says. “Hence, HR professionals should provide expert counsel of leadership development and succession strategy and drive and administer day-to-day implementation.
“Once the decision has been made to develop leadership capability, executive management needs to play an active role in both designing and implementing the process. Senior executive sponsorship and ownership of the process is extremely important to ensure success of the effort,” he says.
“HR experts can provide the technical and professional expertise they need to ensure that executive level managers are active partners with them in designing the process, and in understanding the critical role they play in executing it.”
Finding time for learning and development activity in an already busy working day presents its share of challenges. “When most high potential leaders are working 60 hours a week ... when do they have time for development?” asks Watt.
“Many development activities are not ‘in addition to’ the real job, but in fact become the real job. Very often, development planning involves making decisions to move the person into a particular position that will enable him/her to gain experience needed to address development in a particular set of competencies, job challenges, or even derailers (an assignment that addresses all three areas is ideal) related to the success profile,” he says.
The challenge for HR
“The most effective way to build leadership bench strength is to identify people within your organisation who have the highest potential for development, and to then diagnose their strengths and development needs against a relevant, business-based profile linked to the organisation’s key business drivers and strategies,”suggests Watt. As a strategic business partner, HR is really well positioned to do so and those that fail to take up the challenge face fairly significant risks.
“If we don’t do more to support our existing leaders and nurture our future leaders, we are likely to face a significant shortfall in leadership talent in the future,” he warns.
“In today’s high-pressure work environment, it is imperative that organisations put in place a range of practices to better support their leaders. This may include better work-life balance initiatives, improved support structures and most importantly, effective leadership development initiatives that prepare, nurture and retain leadership talent. In the end, this will benefit both individuals and the organisations involved.”
Leading light
Gas and electricity retailer AGL began as a privately-owned gas utility in New South Wales in 1837. Since then, the company has built an extensive energy business across Australia with approximately three million customers. Gareth Bennett, group manager of people and culture, talks about AGL's leadership program.
"AGL has determined the behaviours and capabilities an effective leader will need in the future and we've established a leadership competency framework, covering the areas of positioning and executing strategy, engaging people and maximising organisational capability. This framework forms the basis of our performance management and development processes.
"The guiding principle is that, in order to effectively lead others, one must first of all understand oneself. This underpins all our leadership development. We use a series of diagnostics, including 360 degree feedback surveys, to build the self-awareness of our leaders. They are provided with data around their leadership styles and behaviours and how these impact the culture of their workplace, so they know the changes they need to make to positively impact the performance of each individual team member."In addition to a residential senior leadership program, a middle management program and a foundations of leadership program, we've decided to focus on two levels below general management where we identify a deep and wide pool of younger, high potential talent. This group undergoes a series of learning experiences that we have identified they will need if they are to take up a senior leadership position in AGL. Over the course of the program, external and internal experts have worked with the group on topics ranging from leadership resonance through to business ethics and leveraging generational differences. Participants are mentored by general managers and, in turn, they mentor up and coming new talented people from different business areas.
"Overall, we seek to grow our leaders from within (70 per cent), reinforced by targeted external recruitment (30 per cent). AGL looks for leaders who uphold our values, who create a supportive and positive workplace and who work with and develop their teams to produce the best results they are capable of, for the company, their customers and the communities in which they operate."
