John Hansen outlines the key steps organisations need to undertake to identify, attract, fill and retain corporate leadership talent.
A business is a collection of people working for the same cause, and a leader is required to define that cause. Growth of a business will only come through the time and talents of others. To identify, attract, fill, and retain corporate leadership talent, companies need leadership development programs focused on hiring strategies, employee development, and career and succession planning.
Companies face two major challenges in finding and developing leaders. They need to identify qualified candidates to fill current and future leadership roles, and they need to develop a comprehensive leadership program to cultivate and develop the leaders of tomorrow.
In the past, leadership development was focused on only a few individuals in the organisation. First-generation systems to assist with leadership development were siloed and/or hard to use and were not widely adopted. Companies need a system-enabled way to unify methods of assessing and selecting leaders, executing programs to develop skills, and measuring the success of these programs.
Now technology can be deployed to extend these practices across the enterprise and down into all levels of the workforce. Human resource development then becomes an enterprise-wide, effort across the management team and not just the job of the HR department. At the same time, by using a common, integrated technology platform, the HR department can easily and effectively track and execute programs across the organisation. With the right technology system in place, HR can be a role model in delivering to the CEO mandate of doing more with less.
Elements of leadership development programs
Major talent management functions all play a part in a comprehensive leadership development program and can be well supported by a unified talent management technology platform. These functions include recruitment, assessment, performance management, succession planning and career planning.
A successful leadership development program begins with the alignment of leadership development with company strategy and an understanding of the type of leadership style(s) needed to execute that strategy.
1. Determine the best leadership style for your organisation
There are many theories about and techniques for determining the right leadership styles for an organisation. The leadership style, for instance, that is required by a head of corporate security would obviously be vastly different from the leadership style of an art museum director. Company culture will also play a major role in determining leadership style.
One of the main reasons for the high failure rate of new CEOs—more than half never make it past the four-year mark—is poor organisational fit. Here are two ways to assess leaders’ fit.
- Get to know them better. Psychological and behavioral assessments have been statistically linked to current and future success in leadership roles.
- Understand the culture better. Ask your board, employees, vendors, consultants for insight into what makes an effective leader in the company.
Use both sets of information to find alignments or disparities. If there is a glaring cultural conflict, be ready to find a better candidate who possesses the unique skills your organisation requires.
2. Identify current and potential leaders within or outside the company
Leaders can be found both internally and externally. Companies must weigh the cost and timing of developing internal leadership against the cost and availability of hiring from the outside. Research has shown that one of the key advantages of developing leaders internally is that they achieve productivity almost 50 percent faster than external candidates.
To evaluate potential leaders in the organisation, a leadership program needs to identify the expected leadership skills and competencies. Whether companies develop a competence model of their own or use a model, they need to define the success measurements and build them into their performance management system.
When leadership positions cannot be filled from within the company recruitment should use the same measurements to test the existing competencies of future potential candidates.
Online pre-assessments and full assessment testing can help ensure that the right candidates are on the short list. Unqualified candidates are automatically filtered out, not on the basis of their résumés but, rather, on the basis of a self-administered online test or questionnaire.
3. Identify leadership gaps
To fully recognise leadership gaps, companies should determine current and future leadership requirements and compare those with the current leadership team. Then look at the leadership development pipeline and identify gaps in skills and the time required to fill those gaps either via succession plan or recruitment.
4. Develop succession plans for critical roles
Succession planning avoids disruption and employee trauma when the CEO leaves, whether the departure is anticipated or not. But a succession plan should not be confined to executive roles. As part of the leadership program, companies should evaluate critical roles throughout the organisation.
For the greatest efficacy, succession planning should be supported by technology systems that provide the ability to:
- Create backfill strategies that use data captured in the recruiting and performance review processes, coupled with individual career plans
- Add multiple candidates to a succession short list and view all the best options—• Display multiple talent profiles—from C-level executives to individual contributors—side by side to quickly identify the best fit
- Track candidate readiness based on skills, competencies, and performance; promote top candidates based on relative ranking and composite feedback scores
5. Develop career planning goals for potential leaders
Companies that support career planning for their employees gain in retention, engagement, and protection of the leadership pipeline. Combining employee development with self-service career planning enables employees not only to explore potential career paths but also to select the development activities necessary to attain them.
6. Develop a skills roadmap for future leaders
Once the high-potential employees have been identified, a skills roadmap should be developed for the future leaders. In today’s connected world, development programs need to support both traditional and nontraditional learning such as incorporating social networking tools into the development process.
7. Develop retention programs for current and future leaders
Linking pay to performance can be a motivator for an employee, but goal alignment helps potential leaders stay focused on what is important to the company. Recognise excellent performance, and base the upside of bonus potential on the success of both the employee and the company.
Leadership retention is critically important for all organisations, for two main reasons: turnover is expensive and top performers drive optimum business performance.
A well-designed leadership development program is the key to identifying, attracting, filling, and retaining corporate leadership. Technology applications can provide the enabling platform, including recruitment, assessments, performance management, succession and career planning, and development programs.
Talent management practices implemented with robust technology applications can effectively identify and develop—from all levels of the workforce—the leaders who will best drive business performance.
About the author
John Hansen is vice president, HCM product management, JAPAC at Oracle. Oracle is the Human Capital Management solution of choice for more than 14,000 Oracle customers in over 140 countries, including 8 of the top 10 Fortune 500 companies and 30 of the top 40 innovative companies.