Strategy Insight

Without a doubt, the most important role of leadership is to develop the next generation of leaders. After all, hiring is really just a license to learn the job.

Without strong leadership throughout the company, growth will be restricted and limited. Improper decisions will be made or decisions will need to be centralized and funneled to a few leaders who will quickly become overwhelmed. Once overwhelmed, they too will make inappropriate decisions or they will delegate these decisions to those who lack the ability to make them effectively.

Most companies focus on personal traits and technical competence when making hiring decisions. The working assumption is that if a person performed well in one job, he or she will perform well in the next. This of course often proves not to be the case. And hiring gifted people from outside the company makes sense as a tactic but not as a strategy, because there is a scarcity of highly talented individuals. To address this challenge, CEOs need to look at this leadership development challenge as integral to an effective business strategy.

Ram Charan, Stephen Drotter, and James Noel have articulated in their book, The Leadership Pipeline, a way to understand how individuals grow to become leaders and the steps that we can take to make this transition more effective.

There are three major benefits to adopting this pipeline model.

• Emotional stress for individual employees is reduced.
• Skipping passages becomes unlikely.
• The time to prepare someone for the top level is dramatically reduced because it becomes easier to recognize when an employee is ready to move to the next level.

The authors assert that there is a natural hierarchy of work. This hierarchy takes the form of six career passages or pipeline turns. This pipeline is not a cylinder but rather one that is bent in six places. At each change in organizational position, a significant turn has to be made. These turns involve a major change in three areas.

• Job requirements, demanding new skills
• The way they use their time, which we’ll call time applications, and
• Work values

Unfortunately, many managers often work at the wrong level. They’re clinging to values appropriate to earlier passages in which they managed others individually rather than managing other managers. Or, they haven’t acquired the skills or time applications appropriate to their current level. As a result they are less effective or ineffective leaders and the people they manage are negatively affected as well.

The challenge for organizations is to make sure that people in leadership positions are assigned to the level appropriate to their skills, time applications, and values. With an understanding of this model, bosses can become better coaches and more supportive as they recognize the issues with which new leaders are struggling. What prevents companies from growing is, more often than not, the failure of people to be willing to change their work habits, give up their hands-on involvement, or trust a new layer of management.

We’ll explore this concept and approach in the next post.

This entry was posted on November 27, 2008 at 8:12 pm and is filed under Hiring, Leadership, Strategy. You can subscribe via RSS 2.0 feed to this post's comments.

Tags: alignment triangle, business manager position, CEO, Charan, consumer bank, crossroads model, direct reports, enterprise leaders, full performer, functional leaders, functional managers, group executives, group functional manager, Hiring, James Noel, Leadership, leadership development system, leadership levels, leadership passage, leadership pipeline, leadership turn, managing managers, mastery potential, new business managers, next leadership level, pipeline model, pipeline problems, Ram Charan, role, Stephen Drotter, The Leadership Pipeline