How high performance organisations accelerate leadership development

Globa

How High-Performance

Organizations Accelerate

Executive Leadership

Development An i4cp Report

Strategy Leadership Talent Culture Market

How High-Performance Organizations Accelerate Executive Leadership Development

The five domains of

high-performance organizations

About i4cp i4cp focuses on the people practices that make high-performance organizations unique. Years of research

make it clear that top companies approach their workforces differently. At i4cp, we work with our network of

organizations to:

Reveal what high-performance organizations

are doing differently.

Identify best and next practices for all levels

of management.

Provide the resources to show how workforce

improvements have bottom-line impact.

Through our exclusive, vendor-free network – in which peers

collaborate to drive strategic research and share tools and

insights – i4cp provides a unique, practical view of how human

capital practices drive high-performance.

Visit i4cp.com to learn more.

About this report This report addresses executive leadership development and how high-performing organizations

accelerate executives along the path to leadership. It presents the acceleration practices that HPOs

favor, approaches for overcoming obstacles that hinder such efforts, and quotes from survey

participants.

About the Market Performance Index (MPI) i4cp’s Market Performance Index, or MPI, is based on self-reported ratings of organizational

performance in four key areas—market share, revenue growth, profitability and customer satisfaction—

as compared to the levels achieved five years previously. The average of the four ratings determines

MPI score.

http://www.i4cp.com/

Contents Executive leadership development: Finding speed-ups and avoiding speed bumps ................................... 1

Accelerating executive leadership development ............................................................................................ 3

High-performance organizations favor a portfolio of acceleration approaches ............................................. 4

Internal resources; external institutions.......................................................................................................... 6

Friends who mentor; colleagues who coach ................................................................................................... 8

Time in the limelight; time in the trenches .................................................................................................. 10

Recommendations for accelerating leadership development..................................................................... 12

Barriers are substantial, even for high-performance organizations ............................................................ 14

Tighten accountability .................................................................................................................................. 16

Sharpen succession...................................................................................................................................... 18

Loosen the borders ....................................................................................................................................... 20

Recommendations for Breaking Down Barriers to Acceleration ................................................................. 22

Conclusion .................................................................................................................................................... 24

Authors and contributors .............................................................................................................. 26

About the survey.......................................................................................................................... 26

References ................................................................................................................................. 27

©2013 Institute for Corporate Productivity (i4cp)

Use of all results, analysis and findings requires explicit permission from i4cp.

www.i4cp.com Page 1 | Proprietary

Time-to-full-productivity How High-Performance Organizations Accelerate Executive Leadership Development


EXECUTIVE SUMMARY

Executive leadership development:

Finding speed-ups and avoiding speed bumps

It takes time to develop a leader—one who can turn a vision into reality, a market laggard into a top-performer,

an employee into an ambassador. It takes even more time to develop a team of leaders whose collaboration

and synergy can elevate organizational productivity to new heights. Members of i4cp’s working group, the

Executive Leadership Development Exchange, set out to explore how organizations accelerate leadership

readiness in executives; this report, and the findings of a corresponding survey are the result of that

exploration.

First, we sought to learn how seriously organizations were addressing executive leadership development, which

we defined as “the process to prepare individuals for executive-level roles of VP or higher, above and beyond

the scope of general leadership development processes.” The Accelerating the Path to Leadership Survey

found that five of six high-performance organizations (HPOs) with 1,000 or more employees have a leadership

development process in general, and nearly half (46%) offer both a leadership development process and a

separate executive leadership development process. This dual focus is a practice found to be significantly

correlated to i4cp’s Market Performance Index (MPI).


Proprietary | Page 2 ©2013 Institute for Corporate Productivity (i4cp) www.i4cp.com

The survey also asked respondents if they believed their organizations’ executive leadership development

processes were effective at producing ready, capable leaders. Just 20% of study respondents from HPOs that

have executive leadership development programs judge their efforts as extremely or very effective, with two-

and-a- half times as many (48%) estimating their processes to be moderately to fairly effective. This may reflect

an acknowledgement that leadership skills aren’t being acquired quickly enough to create robust succession

pipelines.

We got to the heart of the matter when we examined the practices used by respondents from HPOs to

accelerate leadership talent development, as well as the factors that hinder their organizations’ leadership

acceleration efforts. We sought out which practices HPOs favor, which differentiate HPOs from LPOs, and which

are correlated to market performance.

High-performing organizations offer a balanced approach to developing leadership talent:

They access internal resources as well as external institutions to provide

leadership development learning content.

They call upon trusted individuals for mentoring as well as professional

colleagues for coaching.

They utilize high-visibility assignments as well as hands-on developmental

opportunities.

These firms have insight into the barriers that keep leadership acceleration at bay and readily acknowledge

what they’ve identified: Lack of enforced accountability on the part of leaders, inadequate succession plans,

and inflexible organizational structures are some of the key obstacles cited that need to be addressed.

Building on i4cp’s first report from this study, Accelerating High-Potential Employees on the Path to

Leadership, this report shifts the focus from high-potential employees to a broader view of executive leadership

development. In addition to the research findings, this report includes observations and insights from study

participants. A subsequent report will follow, including interviews with executives detailing stories of their own

“journey to leadership” experiences—what worked, what didn’t, and their personal reflections on executive

development.

Together, this knowledge provides organizations with data, recommendations and insight on the practices that

high-performing organizations use to accelerate executive leadership development.

http://www.i4cp.com/surveys/accelerating-high-potential-employees-on-the-path-to-leadership





A CALL FOR ACTION

Accelerating executive

leadership development Leadership development has long been in the spotlight

as a corporate priority, appearing on i4cp’s list of the top

10 critical human capital issues for the past four years,

as noted in Building a Change Ready Organization:

Critical Human Capital Issues 2013. As the business

world demands more speed and agility, the need to

accelerate leadership development is garnering more

attention.

The sense of urgency is compounded in organizations

that are expecting large proportions of their workforces

to reach retirement age within a few years. This

effectively reduces the number of senior leaders to

mentor replacements as well as the population of

managers, directors and other executives who might

otherwise have risen to take their places.

Therefore, fully preparing rising executives for

leadership roles is a task that many firms have realized

needs immediate attention. This call to action presents

several challenges, including determining the best

approaches for developing executives as well as

identifying and overcoming the obstacles that hold back

the acceleration needed.

Those firms that succeed in accelerating executive

leadership development will find their efforts are

correlated to higher market performance. For example,

creating a separate executive leadership development

process to prepare individuals for executive-level roles

of VP or higher (above and beyond the scope of a

general leadership development process) is a practice

that is significantly correlated to both market

performance and to executive leadership development

effectiveness.

Organizational impact of

acceleration of leadership

development on i4cp's five

domains of high performance

Leadership – ELD acceleration builds a cadre of

leaders at multiple levels, from work teams to

entire business units, who demonstrate strong

leadership principles and create a robust

succession pipeline.

Strategy – It fortifies the executive team with

leaders who can draw from intellectual and

experiential learning to analyze issues, make

decisions, and lead teams toward results.

Talent – It provides the leadership needed to

identify, develop and engage critical talent pools

and continue the cycle of leaders developing

future leaders.

Culture – It creates a business environment

that nurtures the development of leaders,

values the potential that each employee brings

to the organization, and attracts/retains talent.

Market – It amplifies the company’s reputation

for products/services with a brand that also

signifies excellence in leadership, creating value

for stakeholders and customers.

Despite the clear and compelling benefits of

developing executive leaders, many companies

struggle to muster the necessary resources,

sustain top-level commitment and implement

the strategies required to build leadership

bench strength. This report highlights those

practices shown to speed up the development

of executive leaders and identify ways to avoid

or overcome the most common obstacles that

get in the way.

http://www.i4cp.com/surveys/building-a-change-ready-organization-critical-human-capital-issues-2013




High-performance

organizations favor a

portfolio of acceleration

approaches Organizations that pride themselves on their market

performance know that business success comes about

through the alignment and synergy of multiple facets of

the enterprise—spot-on strategies, tight financial

controls, innovative marketing, well-oiled operations,

engaged human capital and more. These high-

performance organizations (HPOs) carry that broad

approach into the ways they address executive

leadership development.

Approaches HPOs favor

The study asked about the extent to which participants’

organizations used 11 practices to accelerate

employees on the path to leadership. In the pages that

follow, we’ll examine those used by HPOs to the highest

extents (very high/high) as well as the practices that

most differentiated HPOs from LPOs and those

correlated to market performance.

Internal and external resources – The study

found that HPOs find value in both in-house

leadership development training as well as

external academic or leadership development

programs.

Mentors and coaches – The use of formal or

informal mentors was found to be a big

differentiator for HPOs in the study, and the use

of coaches—from superiors, peers or external

coaching professionals—was found to be highly

correlated to market performance.

High-visibility and hands-on learning – Study

participants value getting exposure to the board

of directors as well as opportunities to engage

in experiential/action learning. Both are

practices that differentiate HPOs from LPOs.

Eleven leadership

acceleration practices studied

1. Conventional in-house leadership

development training program

2. Coaching (from superiors, peers, external

coaching professionals)

3. External academic or leadership

development training program

4. Informal learning (learning that takes

place without a conventional instructor

and outside of structured training)

5. Formal or informal mentoring

6. Exposure to board of directors (guest at

meetings, face time, etc.)

7. In-role development (short-term stretch

assignments, practice using new

competencies in current assignments,

etc.)

8. Multi-rater feedback to increase self-

awareness

9. Leadership assessment instrument

10. Experiential or “action” learning (games,

exercises, simulations, role-play, physical

activities, case studies, etc.)

11. Rotation to another major

SBU/function/geographic location




Two other study findings bear examination:

Informal learning

It is worth mentioning that informal learning (learning

that takes place outside of structured, traditional

training) is an approach that HPOs value. One-quarter

(25%) of HPOs use informal learning to a high/very high

extent, making it the #4-ranked leadership development

acceleration practice in this study.

In a study i4cp conducted in conjunction with ASTD,

practices found to be correlated with the occurrence of

informal learning included sharing best practices

(successes) and sharing lessons learned

(errors/corrections). In fact, Social and Informal

Learning: Strategy Into Bottom-Line Results (2009),

notes that sharing best practices had the strongest

prediction of market performance.

Organizations sometimes overlook the importance of informal learning, but the collaboration and relationship-

building that occur during informal learning may well be as important as the knowledge-sharing itself. Such

day-to-day learning may occur through planned discussions, quiet observations, processes shared via internal

social networking platforms, social commentary on who to go to for what, and other types of non-organized

activities that never-the-less deliver critical information to potential leaders. Informal learning may also be an

effective approach for knowledge transfer between generations or from experienced leaders to rising leaders.

A surprising area of neglect

One acceleration strategy often touted as a must-have developmental experience returned a lukewarm

response in this study. Rotation to another major strategic business unit, function or geographic location was

the least popular approach used by HPOs, with just 11% of respondents reporting that their organizations used

such rotations to a high/very high extent.



In their own words Here’s how one study participant simplified a

strategy for leadership development: “Identify

and define competencies needed for leadership.

Create specific learning interventions for

building knowledge, skills, and abilities in those

areas. Perform assessments to see how people

are doing on delivering business results. Identify

the gaps and make the interventions available

as needed.”

Internal resources; external institutions There is a strong desire within organizations to be able to create and deliver leadership development programs

that are just right for producing executive talent: programs that aren’t too big and expensive or too small and

inadequate. The hope is that by creating internal development programs, leaders will reflect the company

culture, the industry knowledge, and the differentiating skills that will bring the organization a competitive

advantage.

The desire to leverage respected external programs offered through academic and/or professional

development vendors is also a pull. This study found that HPOs value both approaches.

HPOs rely most on internal resources to develop executive leaders

The survey found that conventional in-house leadership

development programs are the go-to approach for the

largest proportion of HPOs. Such in-house training is

typically delivered in a classroom setting which provides

such advantages of ease of access for attendees, the

opportunity to build relationships with co-workers and

convenient follow-up with instructors. But the proximity

to one’s daily work can often interfere with immersion in

the training.

In fact, a recent study i4cp completed in conjunction

with the American Management Association bears out

the popularity of traditional leadership development. In Global Leadership Development 2013: Everybody’s

Game, organizations still look to traditional instructor-led classroom training as their number one source for

developing leadership skills. It was the top approach cited by more than half of HPOs for addressing

executives’ skills in such competencies as change management and critical thinking/problem solving.

In this study on accelerating executive leadership development, nearly half of HPOs favor conventional in-

house leadership development programs to a high/very extent, making it the top developmental approach

used by HPOs (and LPOs). While this approach doesn’t show a correlation to market performance,

organizations seem to favor the control they have over the content and delivery of home-grown programs.

In-house leadership training is

the #1 development approach

favored among HPOs

High performers

46%*

Low performers

52%*

*To a high/very high extent

Source: i4cp’s Accelerating the Path to Leadership Survey

# 1




Academic institutions and external development programs also garner HPOs’ attention

While many organizations covet the Ivy-league leadership programs offered by respected business schools of

renowned academic institutions, cost can be a factor. Firms need to weigh the investment against the reward—

not an easy concept with which to grapple. Institutions named by study participants include Harvard, Wharton,

Stanford and others. More respondents simply pointed to university programs with MBAs as popular sources

for external development. Such academic programs can be valuable resources for developing the broad

business foundation that is important for leaders to master, but many executives join firms with such an

education already under their belts. Executive MBA programs from elite institutions may be more heavily used

for developing top-level leaders.

Other HPOs decide on using off-the-shelf leadership development programs created by professional

development vendors. Such decisions allow companies to avoid the cost of developing and delivering their own

training and to reap the benefit of having participants mingle with executives from other companies, industries,

and locations, thereby exposing them to new perspectives.

In either case, these external academic and leadership development training programs are the third most

popular approach for accelerating executive development (to a high/very high extent), differentiating HPOs

from LPOs by 5.6 percentage points.

Using outside institutions is the third

most popular development approach

for HPOs

High performers

27%*

Low performers

22%*



20% DIFFERENCE



Friends who mentor; colleagues who coach Individuals aspiring to leadership roles understand that they’ll need to build on the knowledge and strength of

others to attain the skills needed to lead effectively. Those others may include mentors and coaches. While

some use the terms interchangeably, mentors and coaches serve very different purposes:

A mentor is a strategic career advisor who typically focuses on the individual, providing guidance and

advice on the broader area of work life. For example, a mentor may advise an executive on how to

expand his or her network, suggest good sources for foreign language learning or connect the mentee

with a contact for a public speaking engagement.

A coach is a hands-on advisor on developing specific leadership skills who typically focuses on the

task, providing an individual with approaches for building and practicing skills needed for

performance. For example, a coach may work with an executive on softening his approach to

performance improvement discussions with direct reports or sharpening her negotiating skills with

vendors.

High-performance organizations ensure that rising leaders have access to both types of support. The use of

mentoring and coaching each proved to be a differentiator between HPOs and LPOs in our study.

Mentoring as a strategy to guide rising stars differentiates HPOs from LPOs

Of the 11 practices studied for accelerating leadership development, formal/informal mentoring delivered the

largest percentage point differentiation between HPOs and LPOs. HPOs are 1.8 times more likely than LPOs to

use mentoring to a high/very high extent.

With formal mentoring, the organization may facilitate the pairing of experienced and rising leaders. The

mentoring assignments may have a fixed time span—and training in mentoring would likely be provided—since

the organization, as well as the mentee, expects to benefit from the assignment.

In informal mentoring, the relationship may be initiated by either the mentor or the mentee or even by a third

party who recognizes the potential in the match-up. Training is unlikely to be a part of an informal mentoring

pairing, but some relationships can last a lifetime.

Mentoring produced

the highest differential

between HPOs and LPOs,

nearly 10 percentage points

High performers

23%*

Low performers

13%*



56% DIFFERENCE




In their own words Here’s how one study participant summed up

thoughts on the right support: “There is no

substitute for a rising executive having a more

experienced leader to look up to and learn from.

Having a good developer of leaders as one’s

manager would be worth 10 programs.”

Coaching by colleagues is the go-to approach of HPOs

to develop and hone leadership skills

Coaching (from superiors, peers, external coaching professionals) is the #2-ranked approach used by HPOs for

accelerating employees on the path to leadership. What’s more, the study finds the use of coaching to be

significantly correlated to market performance (.19**). Findings show a differentiation of 8.4 percentage

points between HPOs and LPOs that use coaching to a high/very high extent.

Often coaching is expected to be provided via superiors, although this expectation is less prevalent at

executive levels. While the use of coaching is clearly valued, respondents also admitted that managers of high-

potential employees weren’t all that effective at providing that coaching, as presented in i4cp’s report

Accelerating High-Potential Employees on the Path to Leadership (2013). More than half (51%) of

respondents said that leaders who are ineffective at coaching and managing their hi-pos are the top hindrance

to the success of high-potential development programs, This provides clear evidence that providing leaders

with adequate training on how to coach effectively is critical to both coach and coachee.

Peer coaching, with the relationship feeling more

collaborative than with coaching from superiors, can be

an effective option with some levels below the rank of

senior executives. Take care to ensure that peer

coaches are taking assignments voluntarily and that

they are provided with training on coaching techniques.

This training should also include how to lead in a virtual

environment, given the growth of virtual and global

teams.

The use of external coaching professionals is another option and, likely, the most relevant to executives. When

the “build or buy” question arises, organizations may want to consider engaging professional coaches for rising

leaders rather than calling upon current executives. The use of such external coaches provides several

advantages: they are not ingrained in the politics of the organization, they are certified in the intricacies of

coaching, and they are accustomed to bringing out the best in a wide variety of personalities, including those

who resist coaching.

Coaching is the practice most highly correlated

to market performance

High performers

43%*

Low performers

35%*



21% DIFFERENCE




Time in the limelight; time in the trenches There is a time to rise and shine, and there is a time to buckle down and get dirty. To truly accelerate executive

leadership development, organizations must provide executives with opportunities for both. Our study finds

that development blossoms when it’s balanced by a combination of high-visibility assignments and hands-on

challenges.

HPOs give rising leaders ample opportunities to shine

Rising leaders value high-visibility assignments that give them an opportunity to shine in front of important

people, such as the board of directors. In fact, exposure to the board of directors (such as by being an invited

guest at a meeting or having face-to-face time) is the acceleration practice that provided the third highest

differentiation (7.5 percentage points) between HPOs and LPOs using such exposure to a high/very high

extent.

The chance to provide project results to directors at a formal board meeting gives rising executives an

opportunity to polish presentation skills, demonstrate expertise and field questions. It’s also an effective way

for board members to connect a name with a face. Another way to increase the visibility of rising workplace

stars is to connect them with community leaders in philanthropic efforts. This allows up-and-coming executives

to hone their leadership skills by practicing them in a different context.

One and a half times as many HPOs as LPOs

use board exposure to accelerate

leadership development

High performers

21%*

Low performers

13%*



HPOs ensure that future leaders have learning opportunities beyond their own jobs

The use of hands-on assignments that leverage experiential/action learning is yet another acceleration

approach that differentiates HPOs from LPOs (by 5.2 percentage points), the fourth-highest differentiator

among the 11 practices.

Such experiential or action learning goes beyond on-the-job learning and includes activities like games,

exercises, simulations, role-play, physical activities, case studies and other hands-on methods of development

that are designed to build skills and traits needed in senior positions. These various methods of development

offer their own advantages in specific settings:

Business simulations play an integral role in experiential learning, especially at the senior executive

level. Disney ABC Television Group, an i4cp member, delivers a 2 ½ day business simulation as one of

the modules in the 4-part Disney Executive EDGE (Essential Development Growth and Expertise)

program. “This simulation is successful because it is as real-to-life-as-possible and challenges

47% DIFFERENCE





thoughts on the ideal development combination:

“Coaching, mentoring and action learning in

combination are the three best approaches for

accelerating the development of executive

leadership capabilities.”

participants in leading large, complex organizations and making critical decisions that drive

profitability,” noted Clare O’Brien, director of learning & development. Disney developed this program

through rigorous interviews with over 40 senior executives and partnership with a steering committee

made up of the CEO and presidents from each business unit.

Physical activities, such as ropes courses, build team camaraderie, confidence, and trust. Companies

such as 3M Unitek, Farmers Insurance Group, and Mattel have participated in such activities with Los

Angeles-based firm Fulcrum Adventures, one firm offering ropes courses as part of its indoor/outdoor

team-building experiences.

Case studies allow participants to exercise their

brains and analyze why specific actions worked

or didn’t work. The Boeing Company (an i4cp

member) uses an internally developed online

application to support collaboration and

knowledge transfer across the enterprise as

independently contributed content, or as

groups. The Facebook-like application includes

contributions from subject matter experts and

communities of practice.

Games and exercises provide a fun way to reinforce important concepts. Firms such as i4cp member

Microsoft Corporation, Procter & Gamble, Qwest Communications and Hewlett-Packard have

participated in such programs with Peak Experiences International, Inc., just one of the companies

providing experiential learning activities such as a “silo” experience examining group dynamics and a

“maze” experience using strategic planning and collaborative decision-making.

Offering a variety of hands-on development approaches ensures that participants build skills regardless of their

preferred learning style.

Experiential/action learning is another practice that

differentiates HPOs from LPOs by more than

five percentage points

High performers

18%*

Low performers

13%*



32% DIFFERENCE



Recommendations for accelerating leadership development

Recommendations Actions Benefits

Fully leverage internal

learning expertise and

experienced executives when

creating in-house leadership

development programs.

Offer in-house development

programs via a variety of

modalities: traditional

classrooms, virtual classrooms

or online classes.

Leverage internal social

networking platforms to identify

internal expertise.

Involve senior leaders in

designing content for programs

and participating as guests in

the delivery of training.

Providing a choice of learning

modalities increases the appeal

to various generations, leading to

better engagement and retention

of the content.

Facilitates passing on the wisdom

of experienced leaders and

provides opportunities for rising

leaders to connect with senior

leaders.

Encourage mentor/mentee

relationships, both formal

and informal.

For a formal mentoring program,

create a database of willing

mentors supplemented by video

introductions.

For informal mentoring, provide

mentees with training on how to

specify goals, propose a

timeframe and go for the

“ask.”

Even though it’s difficult to isolate

quantitative results from

mentoring programs, increased

satisfaction and retention of key

talent are two relevant measures.

Mentees who are clear about

what they want to accomplish will

find it easier to connect with the

right mentor.

Personalize coaching for the

specific development needs

of individuals.*

Select external coaches based

on relevant business experience,

recommendations from trusted

sources, an interview and

validated client results.

Match coaches and coachees on

personality fit as well as the

coach’s expertise/issue fit.

Interviews and validated client

results are the selection criteria

most highly correlated to

coaching success.

Avoids the #1 reason coaching

assignments are terminated:

coach/coachee mismatches.





Facilitate exposure to

corporate leaders and

thought leaders to build

confidence and networks.

Ensure that executives being

developed have opportunities to

manage projects and schedule

those executives to present a

synopsis of results to the

executive team or board of

directors.

Seek out opportunities for rising

leaders to attend high-profile

business or community functions

to make new connections.

Sharpens presentation skills and

Q&A responses as well as helps to

create or deepen relations with

senior leaders.

Builds visibility in the larger

business community, enhancing

personal and professional

reputation.

Offer experiential/action

learning to practice and hone

new skills.

Develop simulations and role-

play exercises based on true-to-

life scenarios.

Document important business

transactions or decisions as case

studies to be reviewed and

analyzed.

Provides an opportunity to try out

and practice valuable and

relevant new skills without risk.

Gives rising leaders a glimpse at

decision-making with incomplete

data and ambiguous

circumstances.

Source: i4cp’s Coaching: What Really Works Playbook



Barriers are substantial,

even for high-performance

organizations The portfolio of executive leadership development

approaches presented in the first half of this report

provide high-performance organizations with a wealth

of strategies for accelerating leadership development.

However, these HPOs are also cognizant of the

challenges they face that hinder such acceleration.

Three pockets of hindrances exist

Our study asked participants about 17 factors that may

inhibit their organizations from accelerating employees

on the path to leadership.

Of these 17 hindrances, six rose to the top, with more

than one-third of respondents from HPOs indicating

these barriers as hindering them to a high/very high

extent. These six factors fell into three pockets of

hindrances:

Inadequate accountability among leaders –

Our study found that leaders aren’t being

adequately held accountable for developing

their direct reports, a factor with a high negative

correlation to market performance. What’s

more, their coaching skills were perceived as

inadequate as well.

Weak succession plans – One of the top

hindrances to acceleration was having a

succession plan that just didn’t reach down

far enough into the organization. Further,

respondents told us that leaders weren’t

being held accountable for adhering to

those succession plans.

Rigid silos – Functional or business silos were

found to have a negative correlation with

market performance. Even in HPOs, such

organizational barriers were keeping firms from

leveraging job rotations to their advantage.

Seventeen hindrances to

accelerating leadership

development studied

1. Leaders are not held accountable for

developing their people

2. Succession plan does not reach down

far enough in the organization

3. As an organization, we don’t use

rotations to our advantage to broaden

knowledge

4. Leaders are not held accountable for

adhering to the succession plan

5. As an organization, we are not good

enough at coaching

6. Functional or other business silos

7. Lack of a succession plan

8. As an organization, we are not good

enough at mentoring

9. No follow-up to training

10. Lack of budget

11. Training provided is not relevant to needs

12. Lack of talent mobility

13. No formal mechanism for progressing

diverse candidates to leadership roles

14. No formal mechanism for progressing

women to leadership roles

15. Lack of CEO support

16. No defined leadership competencies

17. Inability to demonstrate ROI




Barriers caused by lack of leadership development

budgets and inability to demonstrate ROI

Two factors related to spending bear examination, even though less than

one-quarter of respondents from HPOs selected these barriers.

First, the lack of budget (for leadership development) produced the

highest negative correlation to market performance (-.26**) as well as

the largest differentiation between HPOs (23%) and LPOs (52%). This

suggests that effective leaders are a driver of market performance and

investment in development is a driver of effective leaders. While we

can’t point to causation to say that lack of spending on leadership

development leads to low market performance, we can point to the

relationship between the data and see that LPOs are 77% more likely

than HPOs to say a lack of budget for leadership development is a

hindrance to leadership acceleration to a high/very high extent. This

reflects a lack of commitment and ability to invest in and develop

executive leaders.

Second, the inability to demonstrate return-on-investment (ROI for

leadership development) is a large differentiator, with 2.5 times more

LPOs (35%) than HPOs (14%) seeing it as a hindrance. This difficulty in

demonstrating ROI may well be related to the state of or lack of a

measurement mindset in an organization. Just 26% of respondents from

LPOs use a formal measurement tool to determine the effectiveness of

executive leadership development efforts to at least a moderate extent,

compared with 45% of HPOs.

This research identified three strategies that organizations can use to

overcome or avoid entirely the hindrances to executive leadership

development.



Tighten accountability The aforementioned observances on lack of budgets and inability to demonstrate ROI for leadership

development relate to another failure of commitment, that of lack of accountability. The study found this

accountability issue rearing its head more than once. Respondents said:

Leaders aren’t being adequately held accountable for developing their people.

Organizations aren’t ensuring sufficient coaching skills in managers.

Leaders aren’t being held accountable for adhering to succession plans

—a factor that’s presented more fully in the next section.

This perceived lack of leader accountability is a red flag, warning HPOs that superficial treatment of

development can’t be tolerated. Enrolling rising executives in leadership development programs and having

them earn a certificate is not the objective. Nor is rolling out a coaching initiative without providing managers

with the proper training to coach their direct reports effectively. Accountability can only come by stating specific

expectations up-front and comparing results to expectations, granting rewards and meting out consequences

as appropriate.

Hold leaders accountable for development

This transgression of not holding leaders accountable for developing their people is the top hindrance among

respondents from organizations with 1,000 or more employees, even among the HPOs. Within those HPOs, it is

tied (with shallow succession plans) as the top hindrance to the acceleration of leadership development.

What’s more, it has a significant negative correlation (-.24**) with market performance, the second highest

negative correlation to MPI among the 17 factors studied. This suggests that addressing this barrier could

boost market performance for HPOs and LPOs alike.

More than half of HPOs have flagged this loose end as problematic to a high/very high extent. It’s clearly not

enough to send individuals off to attend leadership development programs and consider one’s job done. While

the participants certainly also hold responsibility for their own development, leaders need to be held

Not holding leaders accountable for developing

their people is seen as the top hindrance

to accelerating employees on the path to

leadership and has one of the highest

negative correlations to market performance

High performers

51%*

Low performers

61%*







the need for accountability: “Senior leaders

[must be] held accountable. A significant portion

of their annual bonus [should be] tied to

achieving specific objectives toward

acceleration.”

accountable for ensuring that the expected development has occurred and remedying the situation if it has

not. Does the problem lie with the student? The program content? The instructor? The leader must carefully

audit what’s hindering development, then take the appropriate steps to correct it.

Develop critical coaching skills

If coaching rising executives is being handled internally,

as opposed to being delivered by external coaching

professionals, those doing the coaching must be

instructed in all the nuances of coaching. Yet 35% of

respondents from HPOs say to a high/very high extent

their organizations just aren’t that effective at coaching.

This message came through loud and clear in i4cp’s

Accelerating High-Potential Employees on the Path to

Leadership report, where more than half (51%) of HPOs said having leaders of hi-pos that were not effective at

coaching/managing them was the #1 hindrance to the success of their hi-po development programs.

Regardless of whether an individual is labeled a hi-po or not, each employee from entry-level to executive

deserves to have coaching for skills development and performance improvement conducted by someone with

the skills and temperament to effect behavior change.

Even in HPOs, more than one-third say their

firm’s coaching skills are inadequate

High performers

35%*

Low performers

39%*







Sharpen succession Succession planning is listed among the top 10 human capital issues of critical importance in 2013 and has

maintained prominence on that list the past four years, according to i4cp’s most recent iteration of its annual

analysis, Building a Change Ready Organization: Critical Human Capital Issues 2013. But recognizing the

importance of succession planning and addressing it well are two different issues. While 73% of respondents

to the critical issues study said succession planning was important, just 25% said they were effective at it.

i4cp’s research on accelerating leadership development bears out this need for more effective succession

strategies. Respondents noted problems in two key areas: succession plans that didn’t go deep enough and

leaders that didn’t adhere to the succession plans made. These strategic misses put the organization at risk

for being unprepared for sudden departures and for eroding trust in leaders among succession candidates.

Create deeper succession plans

Inadequate or superficial succession plans tied (with leaders not being held accountable for the development

of their people) as the top hindrance to accelerating leadership development for HPOs. Demonstrating just how

pervasive this problem is, it is also the #1 hindrance for LPOs to a high/very extent, with an 18.4 percentage

point differential.

While the critical issues study showed about half of HPOs (54%) were taking their succession planning

initiatives two layers below the executive level, just one-third (34%) of LPOs had done so. In fact, HPOs

included succession planning for executives and non-executives alike among their top 10 issues in 2013.

Driving succession plans down further into the organization supports the position that critical roles exist

throughout the firm, not just at the executive level. What’s more, it identifies the candidates whose

development needs to be accelerated, the key competencies that need to be strengthened and a timetable for

producing ready-to-serve succession candidates.

Shallow succession plans top the list of

leadership acceleration hindrances

High performers

51%*

Low performers

70%*



Adhere to the succession plan created

Just as devastating as not having adequate succession plans is putting such plans in place and then not

adhering to them. Even among HPOs, a sizeable proportion of respondents say that not holding leaders

accountable for sticking to the succession plan is a hindrance to leadership acceleration to a high/very high

extent. This lack of adherence to the succession plan could be due to pipeline candidates that are not yet

adequately prepared for a move, making acceleration of development all the more important.

31% DIFFERENCE






thoughts on succession: “A consistent plan

needs to be put in place that will be aligning

succession and talent development initiatives.

For this plan to be effective, the support of all

levels of management is absolutely necessary.”

When an executive vacancy is filled with someone other

than a planned successor (either external or internal), it

sets off a chain of negative reactions. First, the planned

successor gets an unpleasant surprise. Next, succession

candidates for the planned successor’s position are

stymied for movement. This could continue down as far

as the succession plan goes and possibly beyond. Also,

the actual successor (who was not on the plan) may face

resentment from colleagues whose sense of fair play

has been disturbed. If the successor is external, that person may have greater than normal difficult getting

established and accepted, which is already a sizeable challenge for executives sourced from outside. If the

successor is an internal candidate that was not on the succession list, the credibility of the whole succession

process becomes suspect and trust in the executive team could erode. In other words, breaking with

succession plans can be a costly faux pas. This issue is a little less prevalent among HPOs, suggesting that the

other 56% of HPOs are creating succession pipeline candidates that are ready to be moved when a succession

event occurs and, therefore, are less likely to experience this hindrance.

More than four in 10 organizations say that not

holding leaders accountable for adhering to the

succession plan is a hindrance to acceleration

High performers

44%*

Low performers

48%*






thoughts on the right developmental

assignments: “[Use a] strategic staffing

approach that links development and job

assignments that both rotate the individual

through key positions and develop the portfolio

of experiences necessary for executive

leadership.”

Loosen the borders Our study makes one other point crystal clear: the organization needs to think and act as a unit when it comes

to talent. Siloed thinking, selfish motives and protective actions won’t elevate organizational performance to

the level it might otherwise reach. Talent belongs to the organization, not to any single business unit or

individual manager.

One-third of HPOs admit that functional or business silos are getting in the way of accelerating executive

leadership development. Even more say they’re not using rotations to the organization’s advantage as a

strategy for broadening knowledge. These hindrances prevent rising executives from gaining the broad

business perspective or global immersion that might ready them for promotion opportunities.

Collaborate on increasing opportunities to offer rotations

Job rotations to another function, another business unit or another geographic location can provide rising

executives with knowledge and experience they would not be able to acquire in their own little corner of their

corporate world. Yet even HPOs (more than 40%) say to a high/very high extent they are not adequately

leveraging such opportunities.

One culprit is an ownership mentality about talent.

Managers with exceptional employees want to keep

them, not send them away to learn more or get snatched

up for a promotional opportunity. Another is the “not-my-

job” mentality—managers may be wholly focused on the

performance and productivity of their own employees

and aren’t warm to the idea of developing an ongoing

rotation of visitors to train and monitor. Both types of

thinking inhibit the creation of job rotation opportunities

and, with it, the further development of key talent.

Not leveraging rotations is the only hindrance that is more

of an issue for HPOs than LPOs

High performers

44%*

Low performers

39%*



Rid the organization of siloed thinking

The inability to expand one’s sense of responsibility beyond one’s job has a detrimental effect on corporate

performance. In fact, having too many functional or business silos produced the third highest negative

correlation (-.22**) to market performance of the 17 hindrances studied.




The keys to overcoming this thinking involve leveraging systems-thinking, technology and rewards. Use

systems-thinking (enterprise-wide awareness of opportunities) to create assignments that can produce useful

deliverables that serve the dual purpose of also building new skills or honing current ones. Use technology to

connect executives seeking broader learning opportunities with leaders in other business units or geographic

locations that could provide them. Use appraisal and rewards to acknowledge efforts of managers actively

facilitating the development of others.

Organizations struggling with

functional/business silos

see a negative correlation

with market performance

High performers

33%*

Low performers

61%*



60% DIFFERENCE



Recommendations for breaking down barriers to acceleration


Build accountability into

leaders’ performance

expectations and

compensation plans.

Include audit processes and

specific success measures in

leaders’ accountabilities for

their staff’s development.

Reward leaders who successfully

develop direct reports; redress or

replace those who have not

accomplished this.

Clarifies the quantity, quality and

timeframes of leadership

development expected in direct

reports.

Reinforces a message to leaders

that development is a key

accountability and creates a

culture where learning is prized.

Ensure qualified, experienced

coaches for executive

development.

Internally, use role-plays to build

coaching skills such as listening,

probing and giving feedback.

Externally, research sources of

certified professional coaches to

select those whose style and

substance match your

organization.

Create a coaching bank of

managers with specific expertise

that can be called upon when

needed, such as negotiation

coaches, performance

improvement coaches or

global acumen coaches.

Builds coaches’ confidence which

helps build coachees’ trust in the

coaches.

Rising executives benefit from

expert coaching in how to

negotiate, how to deal with

difficult people, how to present a

business case and other key

skills.

Ensures the ability to provide just-

in-time coaching so that those

who need it get it from someone

with coaching talent and subject

matter expertise.

Design doable succession

plans and timetables and

stick to them.

Involve the executive team and

human capital professionals in

creating a succession plan that

details which positions require

succession candidates, how

many potential successors are

to be named for each, and the

process for selecting and

developing potential successors.

Create a specific timetable for

assessing and developing each

potential successor as well as a

“Plan B” for emergency

successions.

Allows organizations to begin the

lengthy process of preparing

potential successors.

Succession transparency in such

plans may boost engagement and

retention of potential successors.

Ensures sufficient time to

determine developmental needs,

provide relevant learning

experiences and bring successors

to a state of readiness.





Make the scope of rotation

strategies and possibilities

enterprise-wide

Create and promote a process for

business unit leaders to identify

short-term (< one year)

developmental rotation

assignments and the criteria for

applying for consideration.

Pilot the rotation project, get

feedback from assignment

leaders and participants, then

modify as needed and roll-out

system-wide.

Encourages cross-organizational

learning opportunities.

Creates transparency of

opportunities and criteria.

Provides means to report and

track rising leaders’ development

activity and progress.

Promotes systems-thinking in

terms of building corporate talent.

Eliminate siloed thinking and

reward enterprise-thinking.

Cultivate organizational-thinking

about job rotations, encouraging

managers to create assignments

that will produce a deliverable

that adds value. Leverage

technology to facilitate the

matching of assignments with

rising executives seeking

development.

Create reward systems that offer

a financial bonus to managers

who actively facilitate the

development of others.

Provides a win-win, with managers

gaining new departmental results

that current staff may not have

time to deliver and rising

executives gaining valuable

developmental experience in

another function, business unit or

location.

Acknowledges the efforts put

forth by managers to promote

organizational bench strength by

actively facilitating leadership

development in rising executives.



Accelerating executive

leadership development adds

"budget and years" to "blood,

sweat and tears."

Conclusion Accelerating executive talent toward leadership

readiness is no small challenge. It is a process that adds

“budget and years” to “blood, sweat and tears.” But

organizations that master the portfolio of learning

experiences that pave the way for leaders as well as the

foresight to avoid common barriers to effective

leadership development can, indeed, create a pipeline of

ready leaders.

Using the “Audit, Act, Accelerate” approach outlined in our initial report from this study, Accelerating High-

Potential Employees on the Path to Leadership, i4cp offers the following actionable strategies for accelerating

executive leadership development:

Audit. Objectively assess how well your organization prepares

executives for key leadership roles.

Ask yourself these questions:

Has the content of your in-house leadership development program

kept pace with the challenges faced by today’s organizations?

Does the off-the-shelf leadership development program offered by

your vendor adequately address the specific needs of your

organization?

Do you have the right coaches and leaders grooming your rising

executives?

Are you enabling opportunities for rising leaders to have

meaningful access to senior executives and the board of directors?

Is your organization using a variety of hands-on experiences to

allow rising executives to learn and practice critical skills?






Act.

Build, upgrade or buy the programs and resources needed

to produce the cadre of future leadership talent your

organization requires.

Customize a competency model that reflects what it will

take to bring your organization success in the coming

decades.

Create learning opportunities that specifically build

these future competencies.

Acquire vetted external resources for initiatives

requiring expertise that is not readily available

within the organization.

Accelerate.

Create a strategy for executive leadership acceleration

that will ready your organization for succession events.

Create a specific succession plan that defines the

number of prepared successors desired for each

position and the levels in which such successors

will be named.

Establish a development plan and timetable for each

succession candidate.

Analyze the effectiveness of processes used and modify

as needed to ensure that the acceleration strategy is

moving the organization to a state of perpetual readiness.

As a consistent entry on i4cp’s annual list of critical issues, leadership development is a key factor in creating a

strong, sustainable, high-performing organization. This audit-act-accelerate model can guide firms in achieving

that status.



Authors and contributors Donna Parrey is a senior research analyst for i4cp and the author of this report. Donna is the lead researcher

for the i4cp Executive Leadership Development Exchange. She received her MS in Management from the

University of South Florida and has an extensive background in human resources as a business partner,

director and generalist prior to joining i4cp. Donna may be reached at [email protected].

Tony DiRomualdo, VP of research, oversaw development of the findings discussed in this report. Lorrie Lykins,

managing editor and director of research services, edited this report; Eric Davis, i4cp’s senior editor, provided

graphic design and proofing.

Several i4cp staff members provided background research and other support for this report. Thanks to Joe

Jamrog, who provided research support, and Andrew Dixon, who provides research coordination and manages

i4cp’s surveys.

i4cp’s Executive Leadership Development Exchange

This survey is a product of i4cp's Executive Leadership Development Exchange group. This group is comprised

of representatives from the following organizations:

AT&T Pitney Bowes

Cargill PNC Financial Services Group

ConAgra Foods SGS

Deloitte Services SunTrust

Federal Reserve Board Toyota

Penske Zebra Technologies

Our gratitude and appreciation go out to the exchange group contributors whose dedication to the study of

executive leadership development made this research project possible. Their time and expertise were essential

in the production of the initial survey instrument, in the final analysis of the data and in the source material for

the case studies.

About the survey The findings in this report are from the Accelerating the Path to Leadership Survey conducted by i4cp and

fielded in October/November 2012. Responses from 337 participants were analyzed in 2012/2013, and the

data in this report reflect responses from organizations with 1,000 or more employees.




References Fulcrum Adventures. http://fulcrumadventures.com/index.html

Institute for Corporate Productivity. (2013). Accelerating High-Potential Employees on the Path to

Leadership.www.i4cp.com

Institute for Corporate Productivity. (2012). 2012 Accelerating the Path to Leadership. Interactive Data.

www.i4cp.com

Institute for Corporate Productivity. (2013). Building a Change-Ready Organization: Critical Human Capital

Issues 2013. www.i4cp.com

Institute for Corporate Productivity. (2008). Coaching: What Really Works. Playbook. www.i4cp.com

Institute for Corporate Productivity. (2009). Peer Coaching: Pulse Survey Results. www.i4cp.com

Institute for Corporate Productivity. (2009). Social and Informal Learning: Strategy Into Bottom-Line Results.

www.i4cp.com

Peak Experiences International, Inc. http://www.peakexperiences.org/experiential_training.htm

http://fulcrumadventures.com/index.html







http://www.peakexperiences.org/experiential_training.htm



The Executive Leadership Development Exchange i4cp is grateful for the contributions of i4cp’s Executive Leadership Development Exchange, a research

working group of peers representing several of the largest organizations in the world, who helped craft our

survey on Accelerating the Path to Leadership. This report is the second published from the study.

Other recently released reports on human capital issues that are available exclusively to i4cp member

organizations include:

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Accelerating High-Potential Employees on the Path to Leadership

In this first report from the Accelerating the Path to Leadership study, i4cp addresses the identification and

development of high-potential employees, specifically examining how high-performance organizations

(HPOs) approach this development. It presents a five-step framework for accelerating the development of

high-potential employees toward leadership readiness.

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Purpose-Driven Performance Management in High-Performance Organizations

In this report, i4cp addresses performance management processes, practices and technology solutions,

specifically examining how high-performance organizations (HPOs) approach performance management

(PM). It reveals the five differentiating components of HPOs that lead to the development of a “purpose-

driven” performance management system

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HR Analytics: Why We're Not There Yet

i4cp's HR Analytics: Why We're Not There Yet examines the use of predictive analytics, common obstacles

in using HR data and the ability of organizations to tie HR data to business outcomes. Recommendations

based on the findings of the report follow an examination of each key data point.

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The Future of HR: The Transition to Performance Advisor i4cp's The Future of HR: The Transition to Performance Advisor combines in-depth research with insights

from international HR leaders to reveal the next steps in HR's strategic evolution.

http://www.i4cp.com/surveys/hr-analytics-why-we-re-not-there-yet

http://www.i4cp.com/surveys/the-future-of-hr-the-transition-to-performance-advisor

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How high performance organisations accelerate leadership development

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