smart chief executives are making strategic investments to ensure their executives can produce strong results. Companies spent an estimated $55 billion on training in 1995, according to the American Society for Training & Development (ASTD). Business Week estimates that companies spend $12 billion annually on executive education and leadership development alone. Budget isn’t the only commitment. Executives such as Roger Enrico of Pepsico and Larry Bossidy of AlliedSignal are spending significant amounts of their business days personally teaching and mentoring future leaders within their organizations. It is becoming increasingly clear that developing executive talent is not a luxury. It is a necessity to remaining competitive. The need for executive education is apparent. The question is how best to develop current and future leaders. How do you pick your leaders? What process transforms people into leaders ready for action? Who designs, manages, and delivers the leadership program? Many organizations have developed solutions to these questions and are banking on their success to ensure the company’s future competitiveness.
The purpose of this multi-organization benchmarking study was to identify and examine innovations, best practices, and key trends in the area of leadership development and to gain insights and learnings about the processes involved. The goal was for participants to direct their own efforts to more effectively create leaders, as well as gain a better understanding of issues and challenges involved in improving and re-engineering the leadership development process.
Thirty-five businesses participated in the study by attending a planning session, completing data-gathering surveys, and attending or hosting on-site interviews. Of those organizations, six were identified by the consortium as having a strong or innovative leadership development process in place. These six were invited to participate in the study as best-practice “partners.”
The following scope defines the content and structure of the benchmarking study. The project team and subject matter expert Robert Fulmer collaborated to create this scope. The scope statement was used to direct the development of questions for the screening survey, the detailed questionnaire, and the site visit discussion guide.
I. Creating a Leadership Development Process
- Looking back to inception
- Tying the leadership program to organizational culture and future strategic goals
- Defining the roles of leaders within the organization
II. Identifying the Leadership Pool
- Identifying the characteristics of high-potential candidates
- Identifying the right people
III. Engaging Future Leaders
- Designing a profound experience for high-quality learners
- Delivering for the best results
- Partnering with key outside resources
IV. Understanding the Effect of Leadership Development on the Bottom Line
- Measuring the results of your leadership program
- Monitoring and assessing progress
- Communicating the results to key stakeholders
Within these four macro topics, 13 key findings emerged. Section One: Creating a Leadership Development Process
1. Leadership development is closely aligned with, and is used to support, the busines strategy of the organization.
2. The corporate leadership development process does not try to handle all of the learning needs of executives within the organization. It focuses on core issues such as values and strategic change that are vital to the entire organization, while the business units focus on challenges specific to their operations.
3. Best-practice organizations carefully build leadership development teams by
emphasizing the importance of both human resources development and business
4. In order to establish and maintain initial success, best-practice leadership development processes are internally focused, externally aware.
Section Two: Identifying the Leadership Pool
5. A majority of best-practice organizations have identified leadership competencies, or at least tried to define characteristics and qualities of successful leaders.
6. Best-practice organizations grow leaders as opposed to buying them.
7. Best-practice organizations focus on getting the right people into the right program.
Section Three: Engaging Future Leaders
8. Action, not knowledge, is the goal of best-practice leadership development processes.
9. Technology can be useful for knowledge dissemination but cannot replace the
importance of bringing leaders together to deepen the learning experience.
10. The leadership development process is linked to the organization’s succession planning efforts.
Section Four: Understanding the Effect of Leadership Development
11. The leadership development process is a symbiotic tool of effective leaders.
12. Best-practice organizations always assess the impact of their leadership development processes.
13. Best-practice organizations’ leadership development processes are costly undertakings but are seen as worthwhile investments.
The past decade has seen wrenching reorganization and change for many organizations. As firms have looked for ways to survive and remain profitable, a simple but powerful change strategy called “benchmarking” has evolved and become popular. Benchmarking can be described as the process by which organizations learn, modeled on the human learning process. A good working definition is “the process of identifying, learning, and adapting outstanding practices and processes from any organization, anywhere in the world, to help an organization improve its performance.” The underlying rationale for the benchmarking process is that learning by example, from best-practice cases, is the most effective means of understanding the principles and the specifics of
A listing of the sponsor organizations in this study, as well as the best-practice (“partner”) organizations that were benchmarked for their innovation and advancement in leadership development.
- Executive Summary
A bird’s-eye view of the study, presenting the key findings discovered and the methodology used throughout the course of the study. The findings are explored in detail in following sections.
An introduction to the study written by subject matter expert Dr. Robert Fulmer.
- Key Findings
An in-depth look at the 13 key findings of this study. The findings are supported by quantitative data and qualitative examples of practices employed by the partner companies.
- Partner Organization Profiles
Background information on the partner organizations, as well as their innovative leadership development processes.