The CEO and Talent Management
What do I spend most of my time doing? Supporting CEOs and strategic HR professionals to build a global leadership pipeline. How do I do this? Mostly by emphasising the importance of Talent Management and Leadership Development and then facilitating it at many levels organisationally.
Why should Talent Management be a CEO priority? We have all seen management theories come and go – business process re-engineering, off shoring etc. Eventually we must reach the conclusion that the quality of leadership is what drives business performance. Unfortunately many companies realise this situation too late, when they have under invested in talent development. The need in rapidly expanding global markets is for adaptable, mobile, culturally aware managers who are able to utilise and understand the value of technology in an increasingly future-oriented world.
Whilst many CEOs have, as a rule of thumb, relied on HR specialists and a few trusted headhunters to provide the solution to their leadership pipeline deficits, this is no longer sufficient.
In a 2005-2006 Global Leadership Forecast, over 4,500 leaders from around the world said that improving and leveraging talent was their second business priority, the first being improving customer service relationships.
A number of recent surveys all illustrate that companies with stronger leadership development systems have higher returns on equity and profit than their competitors. Also emphasised is the direct link between the quality of succession management and shareholder returns. It is no surprise therefore that top performing companies invariably hold their leaders responsible and accountable for developing talent.
How to achieve your leadership pipeline
Whilst the processes and tools around identifying and developing top leadership talent are facilitated by HR, the best companies encourage every leader to spot, develop and retain high performers. The CEO must view talent as a strategic priority and constantly support initiatives to drive this through the business. My own experience is that without CEO support, (genuine rather than lip service!), we might as well all stay at home. Why? Because, ultimately the CEO and Board set the corporate structure. Talent Management and effective succession plans will not survive in a non-supportive culture. The CEO must drive and support strategic HR interventions, yet how many boards lack an HR Director? Every picture tells its own story.
So, what are the practical steps to developing your leadership pipeline?
- Define what your organisation needs in terms of leadership in the future. It will differ from organisation to organisation and at different levels within each organisation.
- Leadership development is not just succession planning for key top jobs. Foster a learning organisation.
- Transparency of criteria around talent management and promotion fosters trust and an expectation of what the organisation wants from its leaders of the future.
- Look many layers down the organisation. As a principle, when helping organisations to recruit new staff I have always advised them to look for potential leaders at that stage. Unless there is a specific short term need for a particular role, always recruit and retain for long term growth of both the individual and the company. In my view leaders need to go walkabout. I know some great talent scouts who do…and no, they are not interfering. They have the business overview and breadth of experience to sniff out talent from the most obscure places.
- Get objective data. Critical business decisions are based on in depth information. Apply this level of due diligence to the promotion of key people and strategic development decisions. Thompson Dunn provides robust diagnosis of individual development needs. We look at the whole person including personality traits, decision-making skills and the potential for strategic and creative thinking. We then develop a personal development plan with each potential leader. This process works, where generic training programmes for high potentials miss the point. We all have specific needs and learn in different ways.
- Evaluate high potentials in terms of their limitations as well as their strengths. Or put simply, one person’s high is another persons panic attack! Equally a ‘shaper’ lower down the organisation can become an arrogant, volatile and unlistening Board member. Our in-depth reports indicate where key learning and growth need to occur before someone is ready to take on a senior leadership position.
- Create a learning and development plan which include new business challenges and job experience. A mix of learning is required. This is the point where coaching and mentoring can be mission critical if the high potential is given a role outside his/her area of expertise and comfort zone. The CEO or Board Member can often spot a useful development option which also serves a key business need at that point in time. However, the individual would also benefit from support at that time.
- Ignore the team context at your peril. The best fit for the job may not be the best person for the team. We also work with CEOs and HR professionals to look at the composition, balance and skill sets within a team. High performance teams are an essential part of profitability and growth whatever the size or challenges of the organisation.
- Get rid of the idea that development is ‘remedial’. Many managers struggle with this. They somehow fail to grasp that we can all improve the level of our game. That’s why Wimbledon champions and Olympic athletes have coaches; not because they are lousy at what they do, but because they are brilliant and want to achieve their peak performance.
In conclusion
Look at these steps to developing your leadership pipeline, whatever level of leader you are, but particularly as a CEO. Then think about what excellent Leadership Development would look like in your organisation.
- What does business strategy tell you about the quality and quantity of talent you need?
- What kind of talent does your business need?
- What and where are the gaps in your current talent pool?
- Spotting the high potentials. This can be a minefield of nepotism, inconsistent criteria, focus on strengths only and no identification of development needs. Thompson Dunn provide an in depth analysis of individuals with additional coaching to supplement their learning once a development plan has been put together. Clearly this needs to involve their current managers and probably peer assessment and evaluation of current performance. 360-degree feedback may be a useful tool here. Objectivity is the key to success here wherever possible.
Pat Thompson
Managing Director Thompson Dunn
