51% without a leadership development strategy.
While Canadian organizations are thinking more than ever about the importance of building a strong leadership culture, too few are actually putting into place the best means to develop leaders.
That’s one of the key findings in a research report prepared by the Conference Board of Canada. The study looks into the relationship between organizational leadership and performance, building on previous research from 1999 and 2001, to see how leadership has progressed. The Conference Board surveyed 441 human resource and business leaders from a broad cross-section of industry sectors in Canada, in both the private and public sectors.
Donna Burnett-Vachon, Associate Director with the Conference Board of Canada‘s Leadership and Human Resources Research Division, presented the report at the recent 2016 Leadership Symposium: Adapting to the Changing Nature of Business hosted by the University of Winnipeg.
Is Leadership Development Even a Priority?
Some of the study’s most interesting findings relate to leaders’ views on the development of leadership within their own organizations.
While 60 per cent of study respondents said leadership development is a strategic priority, only 37 per cent of responding organizations actually have a formal leadership development strategy in place. This shows a disparity in formal programs relative to priorities. Full results to these questions follow below.
Is leadership development a strategic priority?
- 60% said yes
- 31% said no
- 9% said they didn’t know or weren’t sure
Does your organization have a formal leadership development strategy?
- 37% said yes
- 51% said no
- 13% did not know
Further, the report found that 56 per cent of all respondent organizations were not formally measuring leadership development and 62 per cent of respondents said their organization was not doing enough to develop leaders.
“Even at high-level leadership performance index organizations, only about 30 per cent are formally evaluating their leadership development,” Burnett-Vachon said.
How To Improve Your Leadership
The report recommends organizations integrate leadership development into business strategy and then regularly evaluate that leadership development. It goes on to recommend that companies look to leadership philosophies of smaller organizations and devote more resources to identifying high-potential employees.
Burnett-Vachon said organizations need to define a leadership development strategy that integrates leaders at different levels and is aligned to the overall business strategy.
“Maybe it’s about coming back to the strategy and asking what leaders in our organization need to be good at.” she said.
Among surveyed organizations, only 27 per cent had defined programs in place for development of high-potential talent. Of those, only 36 per cent make that program known to employees.
Why Isn’t Top Talent Developed Into Leadership Roles?
The Conference Board report pointed out some top challenges involved in developing high-potential talent including budget concerns, confusion of high-performance/high-potential staff members, engaging and retaining talent, providing development opportunities and making sure opportunities are fairly and equitably delivered.
“We’ve gotten good at identifying high-performance [employees] as opposed to high-potential,” Burnett-Vachon said. “They’re not always the types of people who are the strongest technical people in their functional areas.
“We often pick the people who are very strong performers in their functional areas, and we’ve made them the leader and promoted them. But what we haven’t done a good job at is giving them a broader scope of the organization. We haven’t put them in roles where they got a broader scope of understanding the organization and being able to lead at a more strategic level.”
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She said it’s vital to develop senior managers to recognize high-potential employees who can move into more senior leadership.
“We have to give them the skills to identify those individuals and then really think a bit more broadly,” Burnett-Vachon said. “We need to be developing leaders within our organizations in better ways than we have in the past.
“That type of talent isn’t as available on the open market as it once was. So we have to, as organizations, identify and purposefully develop our next round of senior leaders.”
When it comes to developing high-potential staff, Burnett-Vachon says it’s all about giving them work assignments that will actually provide them with the experiential learning they need to become leaders.
Give High-Potential Employees The Right Opportunities
Great-West Life Assurance Company President and CEO, Paul Mahon, who took part in a ‘fireside chat’ at the U of W leadership symposium with MTS president and CEO, Jay Forbes, agreed with that strategy.
“You can do lots of formal training, but people learn best in real time—doing things,” Mahon said. “When you’ve got a high-potential person who doesn’t realize they’ve got high potential, don’t put them into a job that will scare them. Put them onto a project that will scare them, because the project has a beginning and end point.
“There are also other team members to help out. You will prove that you were right in terms of ‘could they get it done?’ Secondly, they will prove it to themselves. Had we offered them a bigger job, a lot of them would have said they’re not ready for it.”
Spot a Potential Leader In Your Company
Using the results of its leadership studies, the Conference Board created the Leadership Performance Index (LDPI) to summarize skills and behaviours needed by senior leaders to drive a strong performance culture.
These qualities focus on:
- Alignment and culture (clearly communicating a common set of objectives)
- Capacity for change and innovation
- Trust and relationship building
- Personal and professional development
- Identification and development of top talent
The Conference Board found that smaller organizations tended to score higher on the LDPI, compared to medium-sized or large organizations.
“Our thinking is that, in smaller organizations, leaders are a bit closer to the action—more engaged with the frontline employees,” Burnett-Vachon said.
The Conference Board’s research shows that higher LDPI scores appear to have a significant influence on employee engagement and leadership performance. Organizations with higher LDPI scores have higher revenue and growth expectations when compared to the outlook of lower-LPDI organizations.
Has Leadership Improved Over 15 Years?
When it comes to leaders implementing change, the report notes that not much has changed for the better.
In the 1999 and 2001 studies, respectively, just five and two per cent of those surveyed said their leaders had excellent capacity and potential to implement change. Fifteen years later, in the current study, that number has only risen to 14 per cent of respondents.
“It’s an improvement, certainly, but when you think about the complexity of change and the amount of change that’s going on in organizations, it’s actually a pretty disappointing number to see after 15 years,” Burnett-Vachon said.
“[Change] is coming at you faster now than has traditionally been the case,” Forbes said. “It demands a very different attitude in terms of how you lead the organization.”
The report also pointed out the changed nature of organizational leadership compared to 15 years ago. Topping the current list of a leader’s key attributes were the abilities to lead change, inspire innovation, manage complexity and articulate a vision.
“If you think back, even five or 10 years ago, about what would have been on a top-competency list, do you think you would have seen a list like this?” Burnett-Vachon asked. “You would have been looking at things like business and financial acumen, management-type things.
“Now you have these very broad leadership topics on the list. It’s interesting in terms of what we’re expecting of leaders in our organizations and shows we’re giving thought to whether our development is keeping up with what we’re trying to build.”
Both Burnett-Vachon and Forbes said it’s more important than ever to get people engaged in the discussion about leadership.
“It’s about developing a common language,” she said.
“Better communication has always been a hallmark of good leadership, and good clear, concise communication is even more important as we face the challenges we do now,” Forbes said.
“Not one-way communication, but a dialogue. You need to be as good a listener as you are a storyteller.”
Do you think today’s companies are focusing on leadership development? What methods would you suggest for a company to better develop their top talent and prepare them for leadership roles?