The Encyclopedia of Human Resource Management, Volume 3: Thematic Essays

INTRODUCTION TO VOLUME THREE

Everybody has accepted by now that change is unavoidable. But that still implies that change is like death and taxes: It should be postponed as long as possible and no change would be vastly preferable. But in a period of upheaval, such as the one we are living in, change is the norm.

—Peter F. Drucker

It’s difficult to argue with Peter Drucker’s point of view. As HR professionals, we’ve lived through some very turbulent times in the past few years, and it seems unlikely that the landscape will ever return to what it was in the past.

While this may be seen as a threat by some, it can also be viewed as an opportunity by others. A report released by the Boston Consulting Group and the World Federation of People Management Associations (2010) featured 5,561 online responses from human resource and business-unit executive from 109 countries in a variety of industries along with 150 interviews with human resource executives worldwide. The respondents highlighted four HR topics that are critical today:

1. Identifying, attracting and retaining talent

2. Improving leadership development

3. Employee engagement

4. Strategic workforce planning

The questions that these challenges pose are numerous and varied, but they need to be addressed by today’s HR professionals. They include:

1. With so many workers about to retire in many of the developed countries, including the United States, how do we find suitable replacements without losing valuable institutional and process knowledge?

2. How do we identify the leaders of the future, particularly among our mid- and senior-level management corps?

3. With so many recent layoffs, reorganizations, and mergers, how do we positively affect employee morale and commitment to our organizations?

4. With new and younger employees coming up, how do we get an accurate picture of our workforce and what they will need in the future?

5. How do we take advantage of technological advances in the field of learning in order to provide just-in-time information and training for this new and diverse workforce?

Volume Three of The Encyclopedia of Human Resource Management contains twenty-four articles that begin to get to the heart of some of these questions.

The volume is organized around three main topics:

1. Leadership and Learning

2. Strategy and Measurement

3. The Evolution of Human Resources

Let’s take a sneak peek at each section.

Leadership and Learning

In a recent study (2011) conducted by the Southern Methodist University Cox School of Business, 98 percent of respondents indicated that spending levels for management training in 2011 would either stay the same as the previous year or increase, even though their organizations face economic uncertainty. This and other similar findings underscore the importance placed on developing our leaders to meet the challenges of the future. Training magazine’s 2010 Training Industry Report data shows that, of the responding organizations, 27 percent indicated that they intend to spend more on management/supervisory training than was spent in 2009. The next highest category for increased spending was interpersonal skills, with only 16 percent indicating an increase in spending.

Some of the leadership issues discussed in Volume Three include:

1. The influence exerted by an organization’s social context on the practice of leadership

2. Recognizing the blind spots a leader may have and how these can impede an otherwise effective leader

3. The emergence of the concept of global leadership and the role it will play in our expanding world view

4. What the literature tells us about how best to develop our leaders

Learning in general has captured the HR dialogue in recent years, particularly the role that technology is playing to address some of the shortcomings of traditional training. It’s interesting to note that in Training magazine’s Industry Report, when respondents were asked to identify the types of training products and services they intended to purchase in 2011, the two leading categories were (1) online learning tools and systems (39.6 percent of respondents) and (2) authoring tools/systems (30.8 percent of respondents). With technology playing such an important role in how we will be learning in the future, this section of this Encyclopedia will examine some of the challenges to how we learn and the technology that represents an exciting future in the world of learning and development.

Strategy and Measurement

For years, human resources was viewed primarily as an operational function: we processed payroll checks, we hired people, we provided training, and we handled your benefits claims. While human resource (HR) departments may still perform many of these same functions, the best organizations are looking to HR for strategic guidance in many of the areas we’ve been excluded from in the past.

In the Executive Hot Jobs Report from CTPartners (2011), Brian Sullivan, CEO of CTPartners, is quoted as saying; Boards [of directors] have come to grips with the fact that not creating new jobs carries a punishing price and that Post-recession business models need new thinking, and companies all over the world are searching in record numbers for the right leaders to change the ways they do business.

So how has human resources responded throughout the recent recession? There appears to be good news on this front. HR Magazine (February 2011) reported on the results of a survey of both HR and company executives who were asked to assess their human resource function and how it has been affected by the recent recession. While some negative results were reported, most respondents reported that their HR function adapted to the recession and provided leadership where it was needed. When asked how human resources positively contributed to meeting the challenges of the recession, respondents noted the following areas:

1. They made strong commitments to improving the quality of their talent management decisions.

2. They provided a greater focus on performance management.

3. They increased their focus on analytics and metrics.

4. They increased their willingness to try innovative HR activities.

These are positive signs that human resources is moving in the direction of becoming what it has always wanted to be: a true strategic partner in the growth and development of its firms. The articles in this section of the Encyclopedia are meant to increase our exposure to the areas of strategy and measurement by focusing on such topics as:

1. What should we be measuring as HR professionals?

2. How do we become more of a partner with other segments of our organizations?

3. How should we view our workplace to take maximum advantage of the talent and commitment of our employees?

The Evolution of Human Resources

A number of issues that have always been in the forefront of our efforts are becoming even more important, given the recent economic and financial downturns. The latest SHRM Workplace Forecast report, released in February 2011, surveyed 1,247 HR professionals, and 89 percent of them reported linking employee performance to its impact on the organization’s business goals. Another 85 percent reported an increasing expectation on employee productivity. If productivity is under the microscope, then human resources needs to find more creative ways to stimulate productivity through its internal practices and external partnerships.

This section of the Encyclopedia addresses some of the challenges we face in bringing this about. The topics include:

1. How we foster a spirit of innovation in our organizations

2. The skills and competencies we’ll need to meet the challenges of the future

3. How we engage our employees, particularly our younger workers who may have different interests and values from the previous generations

4. How human resources can partner with others to bring about some of these needed changes

The author Joseph Campbell once said that Opportunities to find deeper powers within ourselves come when life seems most challenging. Many of the professional challenges that HR faces now and in the future are highlighted in this volume. We hope that what you’re about to read might stimulate some ideas that you can use in your professional life.

References

2010 training industry report. (2010, November/December). Training.

Anonymous. (2010, November). HR Focus, 87(11), 7–8

Anonymous. (2011, January 27). SMU Cox survey: Companies embrace leadership development in face of economic uncertainties. Jacksonville: Professional Services Close-Up.

Anonymous. (2011, January 24). 2011 executive hot jobs report from CTPartners: Business shifts from caution to competition. New York: Business Wire.

Lawler, E.E. III, Jamrog, J., & Boudreau, J. (2011, February). Shining light on the HR professions. HR Magazine, 56(2), 38, 40–41.

Schramm, J. (2011, April). Under pressure. HR Magazine, 56(4), 104.

PART ONE

LEADERSHIP AND LEARNING

CHAPTER 1

BEST PRACTICES IN LEADERSHIP DEVELOPMENT

CURTIS D. CURRY

ABSTRACT

Organizations are facing mounting pressure to improve how they develop their leaders. This results from a confluence of recent trends ranging from a widely perceived dearth of good leaders to a demographic squeeze created by retiring baby boomers. In order to elucidate best organizational practices, the current article explores the academic and industry literature on effective leadership development. Eight best leadership development practices emerge from the literature: align with business strategy; align with talent management strategy; secure executive support; obtain manager support; utilize leadership competencies; tailor to level of leadership; measure and evaluate; and provide variety in learning formats.

Introduction

The consensus among executives on its importance is striking: leadership development is one of the most critical strategic priorities for organizations today. IBM’s Global CEO Study (Sugrue, O’Driscoll, & Vona, 2005) found that 75 percent of CEOs believe that employee learning aligned to strategic business needs is critical to their organization’s future success. Recently topping a list of fourteen major business challenges, improving or leveraging talent was cited most frequently as a top business priority by 75 percent of leaders in a major industry study encompassing seventy-six countries, 192 organizations, and more than 1,400 HR professionals and 12,000 leaders (Howard & Wellins, 2008).

The present work draws from the author’s more than twenty-five years of experience working with thousands of leaders and dozens of organizations around the globe, recent industry studies, peer-reviewed academic articles, books, and other published resources to identify the best practices in leadership development (LD). The first section of the essay presents an overview of the challenges that are leading organizations to invest heavily in LD. The second section presents organizational LD best practices, highlighting the research findings and illustrating some of the practices with examples drawn from the real world. The third section presents a brief overview of specific best practice learning activities that organizations use to develop their leaders. The final section presents implications of findings for organizations today and for future trends in leadership development.

One major finding of this overview is that there is a great deal of consensus on what constitutes best leadership development practice. While terminology varied from work to work, the top LD practices fell into the following eight categories:

1. Aligning LD efforts to business strategy and providing learners with real-world business challenges;

2. Integrating LD into overall talent management strategies in areas such as performance management, selection, and succession planning;

3. Obtaining executive support and accountability;

4. Obtaining the manager’s involvement, buy-in, and accountability;

5. Identifying relevant leadership competencies;

6. Tailoring LD to the specific target leadership audience;

7. Measuring and evaluating the effectiveness of LD efforts; and

8. Utilizing a variety of learning formats to improve effectiveness.

The Leadership Development Challenge

Over the past decade, developing organizational talent has become a priority that has increasingly captured the attention of executives. Weik (2005) reports that 57 percent of the executives participating in the Executivebench Study had been systematically developing their future leaders for less than three years. An industry study of thirty-seven companies found that outlays for leadership training headed the list of training spending, increasing in both 2009 and 2010 (Daniels, 2010). In 2010, 74 percent of respondents made additional investments in leadership training, and 58 percent either somewhat or totally agreed that learning and development was a strategic investment for their organization (Daniels, 2010).

Even in the midst of a major economic downturn, organizations continued to invest in LD in 2009. ASTD estimated that a total of $125.88 billion was spent on all employee learning and development in 2009 (ASTD, 2010). While exact expenditures on leadership development were not included in the study, executive development (at 4.39 percent) combined with managerial and supervisory training (at 10.35 percent) accounted for nearly 15 percent of all learning program content (ASTD, 2010). ASTD conservatively estimated that in 2007 $2.8 billion were spent on executive development alone (ASTD/Booz-Allen Hamilton, 2009). As a point of comparison, the average 2009 overall expenditure on employee learning was $1,081 per employee (ASTD/Booz-Allen Hamilton, 2009), while across all industries the average expenditure on executive development was $12,370 per participant (ASTD, 2010). Manufacturing companies spent a whopping average of $22,164 per participant on executive development (ASTD, 2010). Clearly, organizations see developing leaders as an important priority and are investing substantial amounts in leadership training and development.

A looming talent shortage coupled with concerns about existing leadership quality are major concerns expressed by executives and human resource leaders. The inexorable demographic trend that has resulted in low birth rates during the period 1965 to 1975 (the so called baby bust generation) coupled with the gradual retirement of the baby boom generation (born between 1946 and 1964) will lead to declines in workforce participation. Organizations will feel increasing pressure to find ways to retain and further develop existing leaders as well as to make wise decisions about how they can most effectively develop scarce future potential talent to keep their leadership pipelines filled. The following sections will explore these two challenges in greater detail.

The Demographic Squeeze and Leadership Development

As the large baby boom cohort (seventy-six million) continues to retire, the major concern for executives and human resource leaders is that, even with increased immigration, there will be inadequate numbers from the baby bust generation (forty-five million) to fill leadership ranks. The U.S. workforce was expected to grow at only 1 percent per year between 2004 and 2014 (Toossi, 2005). More recently the figure was revised downward to .8 percent per year for the period covering 2008 to 2018 (Lacey & Wright, 2009). This translates into even fewer new workers entering the workforce than anticipated, and fewer individuals available to fill vacancies in leadership positions as they open up.

Today’s workforce has the lowest proportion of under-twenty-four participation and the highest proportion of fifty and older participation in the sixty years that such statistics have been collected (Schramm, 2011). The U.S. Department of Labor estimates that, by 2018, individuals in the fifty-five and older age group are expected to comprise an astonishing one-fourth of the entire labor force, up from only 12 percent in 1998 and 18 percent as recently as 2008 (Lacey & Wright, 2009).

Adding to the sense of urgency U.S. corporate leaders feel about attracting and developing top talent, a 2008 report commissioned by Congress found that in 2005, forty-one to fifty-nine year-olds accounted for nearly 53 percent of all management positions (Levine, 2008). The Bureau of Labor Statistics predicts that 1.6 million new management positions will be created between 2006 and 2016 (Levine, 2008), potentially causing a major dearth of talent as boomer retirements from management ranks accelerate.

This picture is equally, if not more, gloomy for executive ranks. The Executivebench Study of 115 executives from nineteen industries found that one-half of the companies expected to lose 50 percent of their senior managers by the year 2010 (Weik, 2005). These inexorable demographic trends will exacerbate the challenges of attracting, developing, and retaining the best and brightest talent.

Filling Leadership Pipelines Is a Global Challenge

The United States is not the only nation facing major challenges of filling leadership pipelines in the face of a graying workforce. The Economist (2009a) reports that the median age of all countries will increase from the current level of twenty-nine years old to thirty-eight by 2050, and the percentage of the population over sixty will double from the current level of 11 percent to 22 percent by 2050.

This ageing trend is most pronounced in the world’s rich countries, where it is estimated that one-third of the population will be retired by 2050. Canada, for example, will see up to two-thirds of its existing 2004 workforce retire within the next two decades, and a third within the next few years. At the same time, the prospective high potential candidate pool of thirty-five-to-forty-four-year-olds will shrink by 15 percent (Leskiw & Singh, 2007).

Not only will the world’s rich countries be dramatically impacted, but so will China. The world’s most populous nation will see its median age rise from today’s thirty to about forty-five by mid-century (The Economist, 2009b). That in itself does not seem problematic until one realizes that, beginning around 2025, China will have more elderly dependents than children (The Economist, 2009b). In the words of Wu Cangping of Renmin University, China is getting old before getting rich (The Economist, 2009b).

Existing Leader Quality: A Cause for Concern

Another major concern expressed by executives is the quality of existing leadership. A DDI/Economist Economic Unit survey of 412 executives conducted in late 2007 showed that 55 percent feared that in the near future their companies’ performance was likely or very likely to suffer as a result of lack of leadership talent (DDI, 2008). Among chief financial officers in the study, that number rose to about 70 percent, while two out of five respondents believed that having the wrong person in the wrong role was the greatest barrier to effective execution of strategy that their organization faced. Moreover, less than one-half of the leaders in the study rated their current leaders as very good or excellent and only 40 percent were satisfied or very satisfied with how quickly their organizations were developing leaders to meet their business needs.

The quality gap perceived by top leaders is echoed in another industry study of more than one thousand U.S.-based front-line managers. Erker and Thomas (2010) sought to understand the perspectives of front-line leaders, about 43 percent of whom had been in the position for less than five years. The authors found that a mere 11 percent had been developed to be leaders by their organizations. Forty percent of these managers were unhappy with the leadership development offerings of their organizations, and only 56 percent of managers in their first year felt they understood what it took to succeed.

Erker and Thomas (2010) further discovered that the largest challenges managers felt unprepared to meet included reprimanding an underperformer (204), firing someone (160), going from co-worker to boss (96), learning the ropes (75), and dealing with senior management (47). Over half the managers reported that they had learned their leadership skills through on-the-job trial and error, and about half felt their managers helped them develop their skills. Alarmingly, respondents who indicated they learned primarily through trial and error, but who did not indicate that they received significant support from their leaders, were more likely to report suffering a number of negative consequences in several key leadership competencies. In the areas of coaching, communication, decision making, delegating, gaining commitment, and planning and organizing, these respondents were more likely to feel overwhelmed, more likely to take longer to feel confident in their ability to do the job, less likely to feel they were receiving sufficient performance feedback, less likely to be positive about their leaders and their organization, and less likely to feel confident in their leadership abilities. Over one-third of this group regretted having accepted the promotion to leader. This confirms one of the findings of the present work: the importance front-line managers attach to having their leader support them as they develop skills to confront the leadership challenges of their jobs.

DDI’s Global Leadership Forecast 2008/2009 found that only one-fourth of the global leaders had a high level of confidence in the performance of their front-line leaders and 28 percent in their mid-level managers over the long term (Howard & Wellins, 2008). Only 37 percent rated the overall quality of their leaders as very good or excellent. In the same study, HR leaders reported that at all levels of leadership, over one-third of leaders fail. The top reasons cited for such a high level of leadership failure included lack of leadership and interpersonal skills (19 percent), lack of strategic or visionary skills (19 percent), lack of management skills (12 percent), and personality/personal style (9 percent). Additionally, the report noted that overall satisfaction with leadership development program quality had declined since 2005. Only 29 percent of HR respondents and 22 percent of business leaders rated their formal leadership development efforts as very good or excellent, while 49 percent of leaders rated them as fair or poor (Howard & Wellins, 2008). Interestingly, a related finding in another DDI study (Erker & Thomas, 2010) found that while 88 percent of front-line managers rate their leadership skills highly, 89 percent have blind spots, areas where they feel they are better than others think they are. Clearly, large numbers of HR leaders, front-line leaders and executives believe organizations need to improve the quality of their leadership development efforts.

Finally, while top leaders stress the importance of leadership development for their organizations, there seems to be a wide chasm between beliefs and practice. The DDI/Economist study cited above found that only 27 percent of those surveyed said they were doing a good or excellent job in talent management (DDI, 2008). That translates to nearly three-quarters believing they were doing only a fair or poor job of talent management. This contrasts starkly with the 75 percent of executives who believed that maximizing talent was a top business priority (Howard & Wellins, 2008). This dissonance between perceived importance and action represents a cautionary fact for organizations: along with aligning LD efforts to business strategy and specific business challenges, strong executive support and involvement in leadership development is one of the most frequently mentioned best practice identified in the current essay.

Best Practices in Leadership Development

From the research overview, eight critical areas were identified as best practices in leadership development. Best practices were drawn primarily from industry studies, which included both original research Howard & Wellins (2008), DDI (2008), O’Leonard (2008), overviews of best practices from Yukl (2006), Fulmer, Stumpf, and Bleak (2009), and Hernes-Broome and Hughes (2004), and recent academic reviews of the literature, including Groves (2007), Leskiw and Singh (2007), and Amagoh (2009). Table 1.1 presents the best practices that were identified. The following section will discuss these best practices in greater detail.

TABLE 1.1. LD BEST PRACTICES IDENTIFIED IN THE RECENT LITERATURE

First Four Business Practices Interlinked

Aligning leadership development with business and talent management strategy and obtaining executive and manager support are closely linked leadership development practices. HR needs to serve as a strong business partner to develop a coherent talent management strategy with the executive team, and HR’s activities should be closely aligned to the overall strategic intent, mission, and values of the organization. In partnership with HR, the executive team and managers throughout the organization should be highly involved in such talent management areas as selection, performance management, talent planning, and succession planning.

The finding that aligning LD to leadership strategy is a critical success factor is consistent with prior academic research. Charan, Drotter, and Noel (2001), Hughes and Beatty (2005), McCall (1998), Conger and Fulmer (2003), Lombardo and Eichinger (2001), Hernes-Broom and Hughes (2004), and Fulmer, Stumpf, and Bleak (2009) have all argued that leadership development needs to be linked to business strategy. Industry studies mirror the academic findings. Leskiw and Singh (2007), Erker and Thomas (2010), DDI (2007), and Daniels (2010) underscore the importance of linking leader learning to business strategy in order to achieve long-term organizational success.

Companies that fail to align LD to real-world business challenges and talent management efforts suffer from lack of strategic focus. Haphazardly sending managers to training, executive MBA, or executive development programs, no matter how prestigious they may be, is no substitute for determining what the greatest business challenges are to an organization, then developing a leadership development strategy best suited to filling that organization’s talent pipeline. While well-designed efforts quite often incorporate such learning activities, they should be tied to leadership skills needed to execute the organization’s strategy. Groves (2007) studied fifteen best-practice organizations that successfully linked leadership development and succession planning. The CEOs and HR executives interviewed in the study reported that involving managers at different levels to create mentoring programs, involving them in identifying and selecting high-potentials, and having them teach leadership workshops were all important elements in their success.

Groves also cited the importance of creating and continually reinforcing an organizational culture that supports leadership development. In the best-practice organizations explored by Groves, this alignment was accomplished through CEO involvement and support, providing leaders with developmental assignments and business-related action learning projects, integrating and reinforcing the desired leadership behaviors through the performance management system, and carefully linking LD to succession planning.

Leader Involvement: Hallmark of Best Practice Organizations

Many organizations widely recognized as best-practice companies, such as GE, Pepsi, and Allied Signal, have long enjoyed strong executive support of leadership development efforts. Jack Welch, celebrated past CEO of GE, frequently taught at the company’s training facility in Crotonville, New York. Roger Enrico (ex-CEO of Pepsi-Co), Larry Bossidy at Allied Signal, and Andy Grove at Intel were strong advocates of leadership development in their organizations and also were active in their classrooms (Tichy & Cohen, 1997).

This trend of leader involvement in learning continues in best-practice organizations. Ingersoll Rand University (IRU) has developed a ladder of engagement model created to ensure alignment between learning and business strategy (Smith, 2009). IRU has also created a governance board comprising leaders from different management levels, including the CEO. The board meets quarterly to set strategic learning priorities. Additionally, leaders at Ingersoll Rand work on design teams with subject-matter experts (SMEs), make sure programs are business relevant, conduct fireside chats during learning programs, and co-teach some of the programs (Smith, 2009).

InterContinental Hotels Group, ranked number one in the American Society of Training and Development’s (ASTD) Very Best Learning Organizations of 2010, created the wheel to help ensure alignment between employee and company goals (Harris, 2010b). The wheel, which incorporates measures from four key areas, financial returns, guest experience, our people, and being a responsible business, is used by managers to assess individual performance. In its efforts to improve leadership development, InterContinental created the leaders lounge, an intranet portal used by managers and directors that contains areas to practice skills, insights on leadership, access to shared practices, leadership tips, videos, and an area that seeks input from leaders on company strategies (Harris, 2010b).

Another top ten company in ASTD’s Very Best Learning Organizations of 2010 was Genpact, a large Indian technology management firm spun off from GE in 2005 (Harris, 2010a). Genpact created an intensive eighteen-month global operating leaders program (GOLD) for high-potential front-line managers that focuses on operational excellence, a key strategic area for the company (Harris, 2010a). The program incorporates classroom sessions, interactions with leaders, and rotational assignments through which leaders work through three functional or regional assignments. Genpact, Ingersoll Rand, and InterContinental Hotel Group are companies that strive to incorporate the first four best practices, aligning LD to business strategy, integrating LD with talent management practices, obtaining executive support, and ensuring manager support.

Identify Leadership Competencies and Tailor Leadership Programs to the Appropriate Level

The current article supports earlier academic literature suggesting that identifying competencies and tailoring programs to the appropriate level of leadership are two important additional best practices in LD. Conger and Fulmer (2003) underscored the importance of focusing on the development of skills needed to solve business problems and provide growth opportunities. With their five rules for effective leadership development, they define the importance of these critical areas. The rules include identifying key positions; making sure to develop bench strength for those positions; making the process transparent by giving feedback on where the individual stands in the leadership pipeline; measuring progress regularly; and keeping succession planning and leadership development efforts flexible to accommodate changing organizational needs.

Two of the three recent industry studies (Howard & Wellins, 2008; O’Leonard, 2008) and two of the three academic studies (Amagoh, 2009; Leskiw & Singh, 2007) reviewed stress the importance of identifying critical leadership competencies to meet organizational needs. Many large organizations have a sophisticated process for identifying job-related leadership competencies, including an array of tools such as interviews, observations of incumbents, the use of focus groups comprised of leaders, using surveys, and performing statistical analysis of the data. Organizations must focus their search for competencies on existing skills, knowledge, and attitudes required for success in the current organization, but should also be able to ferret out some of the competencies that will be needed by leaders to navigate their organizations through future challenges.

Tailoring LD to the appropriate level and selecting leaders to participate were also mentioned in four of six of the primary studies reviewed (Amagoh, 2009; DDI, 2008; Groves, 2007; Howard & Wellins, 2008; Leskiw & Singh, 2007; O’Leonard 2008). As mentioned earlier, efforts to identify potential leaders and design leadership development strategies require executive support and active participation of managers, along with careful alignment with business and talent management strategy. Such customization helps avoid one-size-fits-all approaches. Early career high potentials (HiPos) have very different developmental needs from seasoned executives.

Identifying and developing HiPo prospects was also mentioned frequently in the literature (Amagoh, 2009; Groves, 2007; Howard & Wellins, 2008; Leskiw & Singh, 2007; O’Leonard, 2008). Unfortunately, only 39 percent of organizations in a recent DDI study had programs in place to accelerate development of HiPos (Howard & Wellins, 2008). While organizations believe this is an important element of leadership development, most organizations can do a much better job of grooming HiPos for future leadership positions. As is the case with leadership development as a whole, HiPo development should be linked to organizational strategy and talent management systems, especially succession planning.

Research also stresses the importance of effective learning for new leaders as they are promoted into new positions of organizational authority. This underscores the importance of identifying different competencies for different levels and targeting the LD approach to these diverse levels. Several authors have recognized that, while certain leadership competencies remain consistent over time as an individual is promoted through the ranks, the leader must continue developing new skills as the challenges change at different levels (Charan, Drotter, & Noel, 2001; Lombardo & Eichinger, 2001; McCall, 1998).

Based on their experience with General Electric and several other organizations, Charan, Drotter, and Noel (2001) outline six career passages: (1) from managing self to managing others; (2) from managing others to managing managers; (3) from managing managers to functional manager; (4) from functional manager to business manager; (5) from business manager to group manager; and (6) from group manager to enterprise manager.

At each passage, or leadership turn as the authors refer to promotions to each leadership level, organizations must help leaders understand how their new jobs are different in terms of what the individual is leaving behind and what he or she must learn. The authors break this down into three areas: skill requirements, time applications, and work values. Like other researchers mentioned above, Charan, Drotter, and Noel argue that effective leadership development efforts need to be combined with succession planning. They also cite the importance of leaders understanding how the changes in leadership level change what they do (skills), where they focus their time and efforts (time applications), and what they value most. Identifying critical leadership competencies and tailoring efforts to the appropriate audience are important keys to effective leadership development.

Measure and Evaluate Results

Measuring progress and evaluating results are frequently mentioned in the overall LD literature as a best practice, and by five of the six studies reviewed in the current paper (Amagoh 2009; DDI, 2008; Howard & Wellins, 2008; Leskiw & Singh, 2007; O’Leonard 2008). Not surprisingly, DDI researchers found that companies that measure LD results had programs that were twenty times more likely to be rated as very high quality by executives and HR professionals (Howard & Wellins, 2008). In ASTD’s study of the value of training evaluation (2009), companies indicating they use learning measurement to a high extent were far more likely to have experienced positive business results.

One specific method for measuring results discussed in the literature is to employ Kirkpatrick’s/Phillips’ well-known five-level model: reaction (Level 1); learning (Level 2); behavior change (Level 3); business results (Level 4); and ROI (Level 5). This model was the most commonly used metric in their study (ASTD, 2009). The report also found that Level 3 and Level 4 (behavior change and business results) were believed by 75 percent of study participants to be of high or very high value, indicating that evaluation was viewed as an important element of LD by organizations. Nevertheless, while most study participants viewed behavior change (Level 3) and business results (Level 4) as valuable measures, Level 3 was only used by about 55 percent and Level 4 by about 37 percent of these organizations. This gap represents another area that separates best practice from average organizations.

Newer methodologies such as evidence-based human resources (EBHR) are also beginning to be utilized by organizations (Howard & Wellins, 2008). EBHR seeks to align strategy with talent management by identifying key performance indicators (both financial and performance measures) in order to guide the development of human capital strategies that will have the highest probability of achieving desired organizational outcomes (Howard & Wellins, 2008).

Examples of Best Practice Organizations That Measure Results

McCormick is an example of a teaching organization that integrates many of the best practices from the literature into its leadership development, including measuring results (Frattali, 2009). The company’s leaders focus on promoting shared values, aligning LD to company business plans, and ensuring that LD focuses on business results. Many leaders at McCormick actively model the importance of learning by teaching, and executives often participate in first-line leadership programs and new employee orientations. Rick Frattali, McCormick’s director of learning and development, describes how the process of creating teacher-leaders has been formalized: At a fundamental level, all McCormick managers are evaluated yearly against fourteen competencies, one of which is ‘attracting and developing talent.’ That competency includes active participation in the growth and development of people and effective coaching and mentoring of others (Frattali, 2009).

Other best-practice organizations in measuring and evaluating leadership development include Colgate-Palmolive, Ingersoll Rand, and Caterpillar. In its leadership development efforts, Colgate-Palmolive evaluates not only leader perceptions of effectiveness, but also behaviors learned through solving a business case, observation of on the job performance, and evaluating the leader’s business results (Leskiw & Singh, 2007). Ingersoll Rand University (IRU) has developed a format for leadership development investment requests that includes important organizational metrics. In an article written for Training & Development, Rita Smith, VP of enterprise learning at Ingersoll Rand, describes the process: We calculate expected benefits, one-time versus ongoing costs, per participant cost versus comparable external programs, penetration rates for target audiences, and shelf-life of our learning products, among other measures (Smith, 2009). Caterpillar, in addition to employing best practices mentioned earlier such as expecting leaders to serve as teachers and the creation of learning plans aligned with its strategy, also uses metrics to ensure that learning delivery is timely, convenient, and cost-effective