Filling the Leadership Pipeline - CPP.com

With the unemployment rate in the United States jumping to8.5 percent in recent months (the highest it’s been since 1983,according to the U.S. Department of Labor) the current recessionis showing few signs of abating.Many blame a lack of governmentoversight in key financial areas andmassive breakdown in corporate governance—fromthe failure of corporateboards to hold executive managementaccountable, to the lack of solid,thoughtful succession planning withinorganizations—for the current economiccrisis.Unfortunately, the fallout from recentcorporate failures, specifically inthe finance and insurance industries,has had a trickle-down effect that hasleft virtually no one unscathed.As organizations adjust to newbusiness conditions and economicrealities, they are being forced to cutcosts across the board, which oftenmeans cutting critical positions, programs,and staff. To navigate throughthe current economic headwinds,many companies will be tempted toapproach cost-cutting by wielding anax rather than fashioning a plan.They look to reducing headcountand downsizing their organizationswithout giving much thought to theskills, talent, and leadership they arelosing; determing where and howthose skills could add value elsewherein the organization; or thinking abouthow the loss of particular skills willaffect the company down the road.Most damaging, perhaps, is thatmany companies will slash their investmentsin employee training andleadership development programs,viewing them as “nice-to-haves,” ratherthan critical cornerstones of theirbusiness and keys to their survivalduring tough times.History has shown that eliminatingcorporate initiatives and programsaimed at cultivating employee talent,specifically those focused on managerialand leadership development, putsorganizations at a long-term disadvantagewhen the economy does recover.listen to this featureat www.astd.org/TD/TDpodcasts.htmJUNE 2009 | T+D | 49

Companies lookingto emerge from thecurrent recessionstronger and betterpositioned to competein the new economymust continue toinvest in trainingand developingemployees, with a goalof building a strongleadership pipeline.According to Bersin and Associates,“Organizations cutting costs duringthe 2000 recession eliminated the veryprograms that provided the trainingand programs necessary for developingleaders. Only later would theyrealize that it took at least three yearsto rebuild their internal expertise andstrategic capabilities.Companies that consistently fostera talent-driven culture, however, havethrived despite current conditions,in great part by maintaining theircommitment to leadership developmentprograms.”Underscoring the importance ofleadership development, Hewitt Associates,together with RBL and Fortunemagazine, released a global leadershipstudy in 2007 that found that leadershipdevelopment was embedded into theculture of top companies. The researchcompared global top companies withmore than 530 other organizationsaround the globe. The single characteristicthat distinguished these companiesfrom the others is that they madeleadership a critical part of theirorganizational fabric.The imperative is clear. Companieslooking to emerge from the current recessionstronger and better positionedto compete in the new economy mustcontinue to invest in training anddeveloping employees, with a goal ofbuilding a strong leadership pipeline.While it may be challenging fororganizations to justify these investmentsright now, organizations needto recognize that long-term viabilitydepends on a company’s ability to developstrong leaders.Who is responsible fordeveloping leaders?From managers to board members,leadership development should notjust be limited to human resourcesor the learning organization. Allmanagers are responsible for helpingtheir employees develop to theirfullest potential by continuallychallenging them and increasing theirleadership competencies.According to an article published inthe Harvard Business Review, a part ofthe line manager’s role is recognizing hersubordinates’ developmental needs,helping them develop new skills, andproviding them with opportunities forprofessional and personal growth.These managers need to do this,even if it means pushing rising starsinto different business units. They needto mentor emerging leaders both withinand outside of their own department, disseminatingkey knowledge and offeringevaluations and feedback. The managers’own evaluations, development plans, andpromotions, depend heavily on how successfullythey nurture their subordinates.Companies are increasingly recognizingthat solid management andleadership make all the difference.Good managers and leaders always anticipatethe need for successors and areprepared. However, since organizationscannot assume that the mere existenceof a talent pool guarantees that thesuccession will fit neatly into place,effective succession management demandscareful planning and preparation,mentoring, and grooming.Unfortunately, all too often, leadershipdevelopment and succession planningare managed as separate entitieswithin organizations, despite theirshared goal of ensuring the right skills,in the right place, at the right time. Additionally,leadership development isoften reserved for senior executives. Tobuild a strong leadership pipeline atall levels, succession planning must beconsidered part and parcel of the leadershipdevelopment process (and viceversa), and must reflect the strategicobjectives and goals of the company.Companies that implementsuccession plans focused oncultivating existing talent will nodoubt move into the next decadeand economic growth period with asignificant competitive advantage.The new economy requiresnew thinkingOrganizations today, along with thegovernment, need to consider how the50 | T+D | JUNE 2009 Photos by Shutterstock