Creating Enterprise Leaders

Creating Enterprise
Leaders
CEB HR Leadership Council™

CEB HR Leadership Council™ Content Publishing Solutions
Executive Directors Print Designer

Mike Griffin Tiffany Todd
Aaron Kissel Editor
Brian Kropp Amanda Beddingfield
Managing Director
Leah Johnson
Practice Managers
Adam Brinegar
Sari Wilde
Project Manager
Jessie Knight
Consultant
Caroline Roth
Senior Research Analysts
Christopher Cattie
Laura-Katherine Klein
Research Analysts
Derek Bekebrede
Bethany Horstmann
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HRFR3701715SYN
TABLE OF CONTENTS
ADVISORS TO OUR WORK • iv
INTRODUCTION: CREATING ENTERPRISE LEADERS • 1
CHAPTER I: SHIFT MIND-SETS TO ADAPT TO LACK OF CONTROL • 27

■■ Experienced Leaders Challenge • 32
Change leader mind-sets about their responsibilities by challenging assumptions about their roles.
CHAPTER II: INCREASE TRANSPARENCY TO ADDRESS INSUFFICIENT INFORMATION • 43

■■ Leadership Capability Clouds • 50
Optimize capabilities across leadership teams, rather than trying to perfect individual capability.
■■ Portfolio Reviews • 59
Equip teams to self-identify Enterprise Contribution opportunities, rather than just cascading them down.
CHAPTER III: REDESIGN EVALUATIONS TO REDUCE REWARDS RISK • 72

■■ Network Performance Points • 77
Quantify Enterprise Leadership to make outcomes tangible.
■■ Horizontal Goal Cascade • 78
Personalize objectives to connect contributions with business goals.
■■ Span of Influence Mapping • 79
Clarify the connection between leader contributions and pay.
■■ Cross-Divisional Partnership Review • 80
Asses leaders’ ability to work on shared outcomes with peers and teams.
APPENDIX • 93
HRFR3701715SYN
ADVISORS TO OUR WORK
AIB Group The Dow Chemical Company Mphasis
Airservices Australia Emirates Group Mubadala Development Company
Alberta Public Service Endress + Hauser Holding AG National Bank of Kuwait
Ally Financial, Inc. Ethos International NeuroLeadership Institute
Armstrong World Industries European Broadcasting Union The Nielsen Company
Asciano Group Exelon Corporation Norsk Hydro ASA
Assurant, Inc. General Electric Company Northern Powergrid
Aurizon General Mills, Inc. Nufarm Limited
Avande, Inc. GlaxoSmithKline plc OGE Energy Corp.
Avery Dennison Corporation Goodman Manufacturing Company, L.P. Omnicare
Avnet, Inc. Gordon Food Service, Inc. Ontario Teachers Pension
Bayer AG HCL Technologies OppenheimerFunds, Inc.
BG Group plc The Hershey Company Pariveda Solutions Inc.
Black Hills Corporation Honeywell International Inc. Parsons Corporation
Bombardier Inc. Huntington Bancshares, Inc. RBC Financial Group
Carpenter Technology Corporation IDEO Schibsted ASA
Chemtura Corporation International Flavors & Fragrances, Inc. SENWES Ltd
CIENA Corporation Intuit, Inc. Serco Group Plc
Cisco Systems Jebsen & Co Ltd. Statoil
Citigroup Inc. John Swire & Sons Limited Steelcase Inc.
The Clorox Company G.N. Johnston Equipment Co. Ltd TIAA-CREF
Coats plc Kiewit Corporation Time Inc.
Coeur Mining, Inc. Lafarge S.A. The Travelers Companies, Inc.
Coles Group Limited Learning Development Centre Trina Solar Limited
Compass Minerals International, Inc. Lego System A/S University of California
Cofra Holding AG Leidos, Inc. Westfield Corporation
Coty, Inc. Lenovo Group Limited Westinghouse Electric Company
Crombie Real Estate Investment Trust Lion Pty Ltd. Worthington Industries, Inc.
Daymon Worldwide, Inc. Macy’s, Inc.
DBS Bank Manulife Financial Corporation
Department of the Treasury McCarthy Holdings, Inc.
Deutsche Post DHL Metro, Inc.
HRFR3701715SYN iv
Creating
Enterprise Leaders
© 2015 CEB. All rights reserved. HRFR3701715SYN
1
Few organizations have the
leaders they will need. In fact,
LEADERSHIP IN TRANSITION
less than 30% of business units
have leaders equipped to meet Organizations Do Not Have the Right Leaders HR Leaders Would Replace Members of Their
the organization’s future needs. for the Future Senior Leadership Team If Given the Opportunity
In addition, the percentage Percentage of Business Units with Leaders Who Are Percentage of HR Leaders
of HR leaders who would Equipped to Handle the Organization’s Future Needs,
replace members of their senior According to Managers
leadership team if given the
opportunity has increased to
40% ∆ = 20
nearly 33%.
Percentage
Percentage of HR Leaders
Point Increase 32%
These anticipated gaps are
27%
not simply due to perceived of Business Units
underperformance today; rather,
they stem from the belief that 20%
current leader performance is
not what will be required in the 12%
future.
0%
n = 203 business units. 2003 2013
Source: CEB 2013 Succession Management Survey. (n = 144 (n = 329
HR leaders.) HR leaders.)
Source: CEB 2013 Succession Management Survey.
“The world is faster, more interconnected; I’m worried

our leaders don’t know how to lead in that environment.”
Head of HR
Manufacturing Organization
Introduction: Creating Enterprise Leaders 2

The gap between current
leadership and future needs
LEADERS’ ABILITIES HAVE NOT CHANGED,
exists not because of insufficient
leader capabilities, but rather
BUT THE LEADERSHIP ENVIRONMENT HAS
because the environment in which
they must perform is shifting. Leaders Equally Effective at Competencies Today Changes in Leadership Environment
Leaders’ average effectiveness Leaders’ Effectiveness at Key Competencies, 2007–2013
at key competencies such as
problem solving, agility, and 70% 67%
collaboration has remained 61% “Work is 24/7 now.”
relatively unchanged over the Vice President
past three years. However, as the Pharmaceutical Organization
quotations on this page indicate,
leaders today face greater
35%
complexity in their roles as well as
their relationships with peers and “I don’t know how to use half
teams. of the technology my staff uses.”
General Manager
0% Construction Organization
2007 2013
n = 1,618 (2007); 333 (2013).
Source: CEB 2007 Talent Management Effectiveness Survey;
CEB 2013 Leadership Development Survey.
“Every day I have to influence
someone I’ve never met before.”
100%
Senior Director
81% Technology Organization
74% 71% 69%
58%
50% 46%
“The new opportunities for growth in
our organization can’t really be found
within one unit...you have to look at
the intersection of your work with that
of other leaders across the company.”
0%
g n y t n n Associate Vice President
in tio lit en tio io
ol
v
ca gi em ra vat
S A o Financial Services Organization
llo ag la
b no
lem A an l In
ob ce tM Co
Pr ur
so len
Re Ta Source: CEB analysis.
n = 333.
Source: CEB 2013 Leadership Development Survey.

A few changes in the work
environment are expanding
THE NEW LEADERSHIP ENVIRONMENT INCREASES
complexity in leaders’
interactions with peers:
THE COMPLEXITY OF PEER INTERACTIONS
■■ First, an increase in the number More Stakeholders to Consult Shifting Job Requirements
of stakeholders leaders must Percentage of Leaders Who Agree That the Number Percentage of Leaders Who Agree
consult creates new potential of Individuals They Must Consult or Obtain Approval
barriers to decision making. from to Make a Decision Has Increased 100% 85%
80%
■■ Increasing numbers and
diversity of job responsibilities
force leaders to rely more on 50%
the expertise of others to get
61%
their jobs done. Agree 0%
■■ In addition, increasing business Increase in Increase in
portfolio complexity through Diversity of Job Number of Job
global M&A deals means Responsibilities Responsibilities
leaders are increasingly n = 908. n = 3,409.
collaborating with new and Source: CEB 2014 Enterprise Leadership Survey. Source: CEB 2013 Succession Management Survey.
unfamiliar peers.
Implication: More Potential Barriers to Decision Making Implication: Leaders Must Increasingly Rely on the
Leaders need to consult and build consensus with more Expertise of Others
of their peers to make decisions. Leaders’ scope of responsibility is too large for them to be
experts in all requirements, forcing them to rely more on
others for expertise.
Greater Business Portfolio Complexity

Global M&A Deal Size, USD Billion
$3,000 Jan.–June
July–Dec.
$1,500
$1,571
$1,024 $1,005
$0
2012 2013 2014
Source: Mergermarket, “Mergermarket H1 2014 Trend Report,” July 2014,
http://www.mergermarket.com/pdf/MergermarketTrendReport.
H12014.%20GlobalFinancialAdvisorLeagueTables.pdf.
Implication: Leaders Must Collaborate with Unfamiliar Peers

Leaders must work with new colleagues throughout an
increasingly complex organization.

Leaders also face increasing
complexity in their team
THE NEW LEADERSHIP ENVIRONMENT COMPLICATES
interactions:
LEADER–TEAM DYNAMICS
■■ Geographic dispersion reduces
leaders’ visibility into their Geographic Dispersion of Teams Widening Spans of Control
teams’ day-to-day work. Percentage of Leaders Who Report an Increase in Median Number of Direct Reports per Leader
■■ Widening spans of control Time Spent Working with Direct Reports in Different
Locations in the Past Three Years Leaders have
require teams to be more 50% more
autonomous and perform with 6 direct reports
less direct leader input. 6 today than
4 six years ago.
■■ Finally, less time spent with
3
leaders means that teams 58%
must have a stronger network Agree
0
of support beyond their
2008 2014
direct leader to perform most
n = 10,516 (2008); 908 (2014).
effectively.
Source: CEB 2008 Talent Management Effectiveness Survey;
n = 908.
CEB 2014 Enterprise Leadership Survey.
Source: CEB 2014 Enterprise Leadership Survey.
Implication: Leaders Lack Visibility into Teams’ Implication: Teams Must Be More Autonomous
Day-to-Day Work As spans of control widen and leaders have less time to
Leaders must find new ways to stay informed about devote to members of their teams, teams must execute on
employees’ work as it becomes less visible to them. their objectives without constant leader input.
Less Time with Team

Number of Hours per Week Employees Spend with
Their Direct Leader
Leaders spend half the time with direct
reports today than they did two years ago.
6
6
3
3
0
2012 2014
n = 23,339 (2012); 908 (2014).
Source: C
EB 2012 Enterprise Contribution Survey;
CEB 2014 Enterprise Leadership Survey.
Implication: Management Is More Social Now

Leaders must focus on building a team culture that enables
staff to seek guidance, support, and development from each
other, rather than their leader.

Amidst increasing complexity,
leaders struggle to influence
LEADERS STRUGGLE TO SUPPORT BROADER
enterprise outcomes. In fact, only
13% of HR heads believe leaders
ENTERPRISE OUTCOMES
are effective at supporting peers’
performance. Even fewer heads Leaders Unsupportive of Peer Performance Most Leaders Lack Organization-Wide
of HR believe leaders effectively Perspective
support cross-team collaboration.
Underpinning these challenges

is a lack of organization-wide 13% 38%
perspective. In fact, only 38% of of heads of HR rate their
heads of HR believe that leaders leaders as effective at of heads of HR believe leaders
consider organization-wide needs supporting the performance consider organization-wide
when making key decisions. of other leaders. needs when making decisions.
n = 197. n = 197.
Source: CEB 2014 Enterprise Leadership Head of HR Survey. Source: CEB 2014 Enterprise Leadership Head of HR Survey.
Leaders Fail to Drive Cross-Team Collaboration

“Right now our leaders aren’t willing to think
outside their own business units and it’s
10% hurting our performance. We have to get
leaders thinking about how to have an impact
of heads of HR rate their
on the broader organization.”
leaders as effective at creating
conditions that facilitate cross- Director
team collaboration. Global Leadership Development
n = 197. Logistics Organization
Source: CEB 2014 Enterprise Leadership Head of HR Survey.

A JOURNEY TO A NEW MODEL OF LEADERSHIP
CEB Corporate
Leadership Council
A Sample of Leadership Literature from the Past 100 Years The Global Leader
Great global leaders
CEB Corporate aspire to higher
Leadership Questions Today Leadership Council™ leadership positions,
■■ What model of leadership improves enterprise outcomes in the new The Leadership have strong influence
leadership environment? Imperative skills, and are
Organizations need enabled by market
■■ How do we create more leaders that fit this model? and organizational
to identify and
articulate information.
a long-term strategic
Zaccaro, Foti, & Kenny vision for leadership.
Prevalence of the Word “Leadership” in English Language Books
Self-Monitoring and
Trait-Based Variance
in Leadership Charan, Drotter,
Top leaders are more & Noel
likely to change their CEB Corporate The Leadership
Fiedler style depending on their Leadership Council Pipeline
Engineer the Job tasks. Managing Leadership Leadership pipelines
to Fit the Manager Performance Risks are critical for defining
Team performance Leaders fail to apply leader expectations at
Stogdill depends on leader style their skills effectively all levels.
Leadership, Membership and business situation. due to organizational
and Organization and situational
Leaders use influence to barriers.
enable groups to achieve Hersey Ulrich, Smalwood,
their goals. The Situational Leader & Sweetman
Munson Different situations The Leadership Code
The Management call for different Organizations need
of Men leadership styles. to create a sustainable
Leaders are most Bass process for building
successful when they Leadership and leaders.
can reduce friction and Performance Beyond Rath & Conchie
encourage cooperation. Expectations Strengths Based
Transformational leadership Leadership
not only is innate, but also The most effective
can be developed. leaders invest in their
employees’ strengths,
maximize their team,
and understand their
follower’s needs.
1914 1924 1934 1944 1954 1964 1974 1984 1994 2004 2014
Classical Leadership Humanistic Leadership Transformational Leadership Enterprise Leadership
■■ Leadership through process design and control ■■ Leadership through motivating the performance of people ■■ Leadership through managing complex systems
■■ Effectiveness determined by innate traits ■■ Effectiveness determined by transaction management and ■■ Effectiveness determined by individual ability to drive change
■■ Key Intervention: Select leaders with critical innate traits. situational context ■■ Key Intervention: Develop leaders to role model critical behaviors,
■■ Key Intervention: Develop leaders to manage transactional inspire performance, and drive change.
relationships with employees and adapt to different situations.
Source: J ean-Baptiste Michel, Yuan Kui Shen, Aviva Presser Aiden, Adrian Veres, Matthew K. Gray, William Brockman, The Google Books Team, Joseph P. Pickett, Dale Hoiberg, Dan Clancy, Peter Norvig, Jon Orwant, Steven
Pinker, Martin A. Nowak, and Erez Lieberman Aiden, “Quantitative Analysis of Culture Using Millions of Digitized Books,” Science 331 (2011): 176–182.
© 2015 CEB All Rights Reserved. HRFR3701715SYN_11x17

We interviewed and surveyed
more than 4,000 employees
A GLOBAL STUDY
and leaders and nearly 200
heads of HR at over 300 Partial List of Participating Organizations
organizations worldwide.

We conducted three
distinct surveys: an 180-degree
LEADERSHIP SURVEY METHODOLOGY
leader performance assessment,
a leader network analysis, and a
Survey Participants Categories Assessed
head of HR assessment covering
leadership challenges and
initiatives. ■■ Team performance ■■ Role responsibilities
■■ Personality (self-assessment) ■■ Career challenges
908 Leaders ■■ Barriers to performance ■■ Network interactions
■■ Pressures for organizational change ■■ Management and leadership
■■ Past experiences of team
Assessment
180-Degree
■■ Leader performance
■■ Derailing leader behaviors
Managers
551 of Leaders
■■ Performance of leader’s team
■■ Pressures for organizational change
■■ Functional and organizational strategy
Direct Reports
3,243 of Leaders
■■ Team performance (self-assessment)
■■ Team climate
Using data provided by 423 leaders, we created a network map that

Network
Analysis
Defining a Leader Leader measured the connections between the leaders and those they closely work
362 Connections with. We used the network to measure how average leaders and Enterprise
We define Leaders interact with and benefit from one another.
a leader as an
employee at
Senior
the director
Leader
level or above
who is a
Mid-Level Leader manager of ■■ Business environment in which organization operates
Assessment
Head of HR
managers. ■■ Leader success profiles

■■ Leader skill gaps
197 Heads of HR ■■ Barriers to leader performance
Frontline Manager
■■ Objectives and impact of leader initiatives
■■ Leadership investments
■■ Organizational climate
Individual
Individual Contributors
Contributor
Source: CEB analysis.

Our survey participants
represent a wide variety of
LEADERSHIP SURVEY DEMOGRAPHICS
industries worldwide.
Leadership Survey Head of Function Survey
The graphs on the left side of
Participants by Region Participants by Region
this page show the geographic
and industry breakdowns of 12%
23% 15%
participants in the leadership Australia and Australia and Asia
survey, and the graphs on New Zealand New Zealand
the right show the same 25%
breakdowns for the head of Asia
1% 1%
function survey. South
South
America America
26% 33%
North 25% North 40%
America Europe, Middle America Europe, Middle
East, and Africa East, and Africa
n = 908 leaders; 3,243 direct reports. n = 197.
Source: CEB 2014 Enterprise Leadership Survey. Source: CEB 2014 Enterprise Leadership Head of Function Survey.
Note: Total does not equal 100% due to rounding.
Leadership Survey Head of Function Survey

Participants by Industry Participants by Industry
5%
9% Construction 6%
Other 2% Consumer Goods
Consumer 26% 8%
1% Goods Other Government/
Transportation 6% Nonprofit
6% Energy/ 5%
Hospitality Utilities Health Care
5%
13% 12%
Financial 6%
Retail Manufacturing
Services Utilities
5% 4% 7%
5%
Real Estate Heavy Oil and Gas
Technology
Manufacturing
7% 6% 21%
15% Retail
Professional Services Professional
Technology
Services
14% 8%
Government/Nonprofit Telecommunications n = 197.
Source: CEB 2014 Enterprise Leadership Head of Function Survey.
Please see the Appendix n = 908 leaders; 3,243 direct reports. Note: Total does not equal 100% due to rounding.
for additional demographic
information.

The predominant leadership
approach today is individual
MOST LEADERS CONTRIBUTE TO THE ENTERPRISE
leadership. Individual leaders
support the broader enterprise
BY FOCUSING ON THEIR INDIVIDUAL BUSINESS UNIT
by singularly focusing on their
individual goals and business
units. They provide specific
direction and cascade the Individual Leadership: Result:
resources and information their Individual leaders are highly effective at achieving their own Leaders achieve business
teams need to achieve individual business unit objectives and helping their teams complete unit objectives.
goals.
their individual objectives.
Most leaders are very effective
“I relentlessly prioritize what’s best for my team. The

at individual leadership. As the
data on the right shows, 82%
of their leaders are meeting or organization is better for that. I don’t get sucked into the 82% of leaders are
exceeding their performance
objectives.
wrong things. ” meeting or exceeding their
performance objectives,
Senior Director according to heads of HR.
Professional Services Organization
“Our leaders are hitting the

goals we’ve been putting in
front of them. The problem
is that we’re not seeing as
much of an impact on our
Direction + Resources + Information company-wide numbers as
we would have expected. ”
Chief Executive Officer
Telecommunications
Organization
Source: CEB analysis. n = 197.

Source: CEB 2014 Enterprise Leadership Head
of Function Survey.

Although individual leadership
has a positive effect on
INDIVIDUAL LEADERSHIP IS NOT ENOUGH IN A MORE
business unit performance,
it is not enough to sustain
INTERCONNECTED ORGANIZATION
organizational performance
in today’s environment. The Leaders’ Impact on Revenue
strongest individual leaders Mean to Maximum Impact of Individual Leadership
achieve 4% higher business unit on Business Unit Revenue a
revenue growth and 3% higher
business unit profit growth than
average individual leaders. 6%
The strongest individual leaders “We need our leaders to be thinking about how
achieve 4% higher business unit
However, as the quotes on to drive the organization’s top- and bottom-
revenue growth and 3% higher
Maximum Impact on Business Unit Financial Outcomes

the right illustrate, today’s
complex and interconnected
business unit profit growth
than the average individual
line numbers, not just their own business unit’s. ”
environment requires a different
leader. Head of HR
leadership approach to drive
organization-wide success. 4% Hospitality Organization
3%
3%
“Leaders at all levels need to be thinking about
the enterprise now. It’s no longer just the most
senior leaders.”
Head of HR
Oil and Gas Organization
0% “We used to think of leadership as vertical.

Impact on
Business Unit
Impact on
Business Unit
It’s more horizontal now.”
Revenue Growth Profit Growth
Head of HR
n = 908.
Retail Organization
Note: Individual leadership is measured by the extent to which a leader achieves his
or her own business unit objectives and the extent to which his or her team
achieves its individual objectives.
a
The impact on financial outcomes is calculated by comparing two statistical
estimates: the predicted impact when a leader scores relatively high on a driver
and the predicted value when a leader scores the average score on a driver.
The effects of all drivers are modeled separately, using a variety of multivariate
regressions with controls.

The best leaders today are
Enterprise Leaders: they lead
CEB’S ENTERPRISE LEADERSHIP MODEL
their teams to high performance,
and contribute to and leverage Enterprise Leadership Model
other teams’ performance.
To test this model of leadership,

we evaluated leaders against
individual leadership and network
leadership. To measure individual
leadership, we asked managers to
Individual Network Enterprise Enterprise
asses leaders’ ability to achieve
business unit objectives. We Leadership Leadership Leadership Outcomes
also asked leaders to assess
A leader’s A leader’s A leader’s Revenue and profit
their teams’ abilities to achieve
effectiveness effectiveness at effectiveness at for his or her business
individual tasks and assignments.
+ =
at meeting contributing to meeting his or her unit and other
To measure network leadership, individual and leveraging individual objectives, business units
we asked managers to assess objectives and the performance contributing to or teams
leaders’ abilities to contribute leading his or of other units and leveraging the
to enterprise-wide objectives. her team to or teams, and performance of other
We asked leaders to assess their high individual leading his or her units or teams, and
teams’ abilities to contribute to performance team to do the leading his or her
and leverage peers throughout same team to do the same
the organization. Sample
outcomes assessed include: Source: CEB analysis.
■■ Effectively transferring working

methods, techniques, tools,
ideas, skills, and knowledge
from other parts of the
organization; and
■■ Importing ideas from personal
and professional networks
outside the organization.
Please see the Appendix for

the full list of questions used to
assess Enterprise Leadership.

Enterprise Leaders improve
team outcomes more than
ENTERPRISE LEADERS IMPROVE TEAM OUTCOMES
individual leaders. This page
illustrates four key areas where More Innovative Teams More Adaptable Teams
we found Enterprise Leaders’ Percentage of Teams Achieving a High Level Percentage of Teams Effective at Generating
teams outperforming teams led of Innovation Solutions to New or Unanticipated Problems
by individual leaders.
∆ = 15
■■ Innovation: Enterprise Leaders’ Percentage
∆ = 23
teams are 68% more innovative Point Increase
Percentage
than individual leaders’ teams.
Point Increase
■■ Adaptability: Enterprise
Leaders’ teams are 21% more
adaptable than individual 87%
leaders’ teams.
57% of Enterprise
of Enterprise
72%
Leaders’
■■ Engagement: Growth in 34% Leaders’
of Individual
Enterprise Leaders’ teams’ of Individual Leaders’ Teams
engagement increases 35% Leaders’ Teams Teams
Teams
more each year than that of
individual leaders’ teams.
n = 908 leaders; 3,243 direct reports. n = 908 leaders; 3,243 direct reports.
■■ Customer Satisfaction: Growth
Source: CEB 2014 Enterprise Leadership Survey. Source: CEB 2014 Enterprise Leadership Survey.
in Enterprise Leaders’ teams’
customer satisfaction scores
increase 20% more each year Higher Employee Engagement a Higher Customer Satisfaction a
than those of individual leaders’ Leader’s Maximum Impact on One-Year Change Leader’s Maximum Impact on One-Year Change
teams. in Team’s Employee Engagement in Team’s Customer Satisfaction
1.35x
1.20x
1x 1x
Individual Enterprise Individual Enterprise

Leader Leader Leader Leader
n = 908 leaders; 3,243 direct reports. n = 908 leaders; 3,243 direct reports.
Source: CEB 2014 Enterprise Leadership Survey. Source: CEB 2014 Enterprise Leadership Survey.
a
The impact on employee engagement is calculated by comparing two statistical a
The impact on customer satisfaction is calculated by comparing two statistical
estimates: the predicted impact when a leader scores relatively high on estimates: the predicted impact when a leader scores relatively high on
Enterprise Leadership and the predicted value when a leader scores relatively low Enterprise Leadership and the predicted value when a leader scores relatively low
on Enterprise Leadership. The effect of Enterprise Leadership is modeled using a on Enterprise Leadership. The effect of Enterprise Leadership is modeled using a
multivariate regression with controls. multivariate regression with controls.

An individual leader can achieve a
4% improvement in business unit
ENTERPRISE LEADERS IMPROVE THEIR OWN AND
revenue growth. The bar on the
far left shows that impact. The
OTHERS’ BUSINESS UNIT FINANCIAL OUTCOMES
middle bar shows the additional
3% impact an Enterprise Leader Maximum Impact on Business Unit Revenue Growth a
can achieve for his or her
individual business unit through
Network Leadership. Finally, Enterprise Leadership Impact Enterprise Leadership Impact
an Enterprise Leader can have on Own Business Unit on Other Business Units
up to a 5% spillover effect on 12% 5%
the revenue growth of all other
business units in the organization 12%
by contributing to other leaders.
Those other leaders can, in 5%
turn, collectively improve the Impact from
Maximum Impact on Business Unit Revenue Growth
Implication: An Enterprise
first leader’s revenue growth by Enterprise
Leader creates a spillover
5% (dotted bar). Overall, each Leaders in 5% effect on other business
business unit can achieve up to a Other units.
12% increase in revenue growth if Business
all leaders in the organization are Units
Enterprise Leaders.
6% The benefit to their own

3% business unit that leaders
achieve through network
leadership
4%
Impact on Business Unit Net

Profit Growth
Enterprise Leaders also improve 0%
Individual Network Spillover on
their own business unit net Other Business
Leadership Leadership
profit growth by 10% and other Units
business units’ net profit growth n = 908 leaders; 362 connections.
by 4%. Source: CEB 2014 Enterprise Leadership Network Analysis.
a
To assess the spillover effect of Enterprise Leadership, we created a dataset of leader-to-leader connections. Leaders were asked to indicate
Please see the Appendix for the names of leaders (i.e., a set of peers) with whom they frequently collaborated. An average Enterprise Leadership score was calculated
for each leader’s set of peers, which was used to assess peers’ effect on the leader’s business unit.
more details.

What does Enterprise
Leadership really look like day
THREE KEY SHIFTS IN HOW ENTERPRISE LEADERS LEAD
to day, and how does it differ
from individual leadership?
SHIFT 1
There are three key differences
Take—and Give—with Peers Enterprise Leaders are
in the way Enterprise Leaders
lead that distinguish them from
individual leaders:
Individual leaders use peer
contributions to improve their
1.5x more effective
business unit. Enterprise Leaders at evenly giving and taking
1. They take input from and give use and provide contributions than individual leaders. a
input to their peers. to improve the broader enterprise.
2. They push information to and
pull value from their teams.
3. They facilitate team SHIFT 2
performance, rather than Push—and Pull—Team
directing it. Contributions Enterprise Leaders are
Individual leaders delegate work
to their team. Enterprise Leaders
1.2x more likely
delegate work and ensure to pull contributions from their
team contributions receive the team than individual leaders.b
resources and visibility needed
for success.
SHIFT 3
Facilitate—Don’t Direct—Team
Performance Enterprise Leaders are
Individual leaders provide their
teams with direction to accomplish
1.3x more likely
their tasks. Enterprise Leaders to facilitate team performance
connect their teams with those than individual leaders.c
who can enhance and benefit
from the team’s performance.
n = 908 (Enterprise Leadership); 2,101 (Enterprise Contribution).

Source: CEB 2014 Enterprise Leadership Survey; CEB 2014 Enterprise Contribution Survey.
Please see the Appendix for a
Enterprise Leaders are more likely than other leaders to evenly give and take from their peers, as measured by an average of survey questions answered
by leaders’ managers assessing leaders’ propensity to give to their peers and leaders’ propensity to take from their peers.
more details on the analysis b
Enterprise Leaders are more likely than individual leaders to ensure team contributions receive the resources and visibility needed for success than
comparing Enterprise Leaders other leaders, as rated by the manager.
and individual leaders. c
Enterprise Leaders are more likely than individual leaders to connect their teams with those who can enhance and benefit from the team’s performance,
as rated by the manager.

In addition to the difference in
how Enterprise Leaders operate
A TALE OF TWO COMPANIES
as individuals, there are also
differences in organizations that Characteristics of Organizations with and Without Enterprise Leaders
do or do not have Enterprise
Leaders. This page illustrates how
several key processes, such as Organization WITHOUT Organization WITH
strategic planning and resource Enterprise Leaders Enterprise Leaders
allocation, look distinctly different
in organizations with Enterprise
Leaders.
Conflicting Strategies Connected Strategies

STRATEGIC
Leaders present strategies to maximize business PLANNING Leaders present strategies that incorporate
unit results, resulting in conflicting strategies. strategic needs beyond their business unit.
Cross-Functional Projects Ignored Cross-Functional Coordination Prioritized

STRATEGY
Leaders treat cross-functional projects EXECUTION Leaders seek out cross-functional partnerships.
as side projects.
Competition for Resources Strategic Alignment of Resources

RESOURCE
Teams compete for and allocate resources ALLOCATION Teams allocate resources to business unit
based on business unit objectives rather than objectives that align with organizational goals.
enterprise objectives.
Talent Hoarding Talent Viewed as Corporate Asset

TALENT
Leaders reluctantly discuss their top talent and PLANNING Leaders share opportunities to use their own
listen for talent to poach. talent elsewhere and develop others’ talent.

HR has made substantial
investments to improve leader
HR LEADERSHIP STRATEGIES ARE FOCUSED ON ROLE
performance. As the graph
on the left shows, leadership
MODELING, COMPETENCY MODELS, AND TRAINING
initiatives focus primarily on
encouraging role modeling, HR Initiatives to Improve Leadership Quarter of HR Budget Spent on Leadership
updating competencies, and Effectiveness Average Percentage of HR Budget Spent on Leadership
creating training programs. Percentage of Heads of HR Investments, According to Heads of HR
However, as the data on the
right shows, two-thirds of
heads of HR don’t believe their
Encouraging Leaders 77% 23%
efforts are paying off—despite to Act as Role Models of HR Budget
investing a full quarter of the
HR budget in these initiatives. Updating Competency
59%
Models
Training Employees to
Understand How to Work 56%
Better with Others
Updating Organization
55%
Values
Providing Technological 39% n = 197.

Solutions and Support
Redesigning Employee
35%
Rating System or Process
Poor Return on Leadership Investments
Establishing Governance Percentage of Heads of HR Who Are Confident
for Employee Roles and 35%
Responsibilities Leadership Investments Are Paying Off
Providing Nonmonetary 31%

Incentives
Encouraging Peer-to-Peer
23% 33%
Recognition or Rewards
of Heads of HR
Changing Team Work 19%
Processes
Changing Hiring Processes to
Attract and Select for New 8%
Hire Performance Profile
0% 40% 80%
n = 95.
Source: CEB 2014 Enterprise Contribution Head of HR Survey. n = 197.

Despite investments in
leadership initiatives, only
ENTERPRISE LEADERS ARE FEW AND FAR BETWEEN
12% of leaders are Enterprise
Leaders. The source of this Leader Effectiveness at Enterprise Leadership Model
gap becomes clear when we
look at different pieces of the
Enterprise Leadership model.
Seventy-seven percent of
leaders effectively meet
individual objectives, and 59%
of leaders effectively lead Individual Network Enterprise Leadership
their teams to high individual
performance.
Leadership Leadership
Although most leaders excel

at individual leadership,
A leader’s A leader’s 12%
effectiveness at effectiveness at of leaders are
most struggle with network
leadership. Only 31% of leaders meeting individual contributing to Enterprise Leaders.
objectives... and leveraging the
+ =
effectively contribute to and
leverage peers’ performance, 77% of leaders performance of other
and only 35% of leaders
are effective. units or teams...
effectively enable their
teams to do the same. 31% of leaders
...and leading his or her are effective.
team to high individual
performance ...and leading his or her
59% of leaders team to do the same
are effective. 35% of leaders
are effective.
n = 908.
Note: To determine whether a leader is an Enterprise Leader, we measured leaders’ effectiveness at a set of individual and
network leadership activities (see Appendix for details). Leaders who received an average rating of 4 on a five-point
scale (1 = highly ineffective, 5 = highly effective) were designated as Enterprise Leaders.

If most leaders have the right
skills, why are so few leaders
LEADERS PERCEIVE THREE ECONOMIC COSTS TO BEING
Enterprise Leaders?
ENTERPRISE LEADERS
Leaders perceive three
economic costs that deter them
from becoming Enterprise
Leaders:
1. Lack of Control—Leaders
today must manage an agency
dilemma, operating without
complete control of their 1 2 3
employees; however, as the chart
in the left column shows, few Lack of Control Incomplete Information Rewards Risk
leaders believe they can succeed
without it. Leaders don’t have the control Leaders are uncertain about the Leaders don’t believe they will
2. Incomplete Information— they believe they need to requirements of performing as be fairly rewarded for being an
Competencies alone do not lead their business and teams an Enterprise Leader. Enterprise Leader.
provide a clear roadmap for successfully.
success as an Enterprise Leader,
creating information asymmetry
in leader transactions. As the
chart in the middle of the page
shows, only 37% of leaders I can’t be successful as a leader I understand how to productively My contributions to others
understand how to productively without autonomy and control. contribute to the network. will be financially rewarded.
contribute to others throughout
the organization.
3. Rewards Risk—Most leadership
objectives and evaluations focus 66% 37% 35%
of Leaders of Leaders of Leaders
on individual results. As a result, Agree Agree Agree
most leaders do not believe
they will be fairly rewarded for
Enterprise Leadership.
n = 908 (Enterprise Leadership); 2,101 (Enterprise Contribution).


The best organizations
implement three strategies to
HR STRATEGIES TO REDUCE ENTERPRISE LEADERSHIP
address the economic costs of
COSTS
First, they help leaders adapt From… To…
to a lack of control by shifting
leaders’ mind-sets about their
roles, instead of just building
Building new leadership skills Shifting leaders’ mind-sets
new leadership skills. Lack of
to help leaders adjust to having about their roles
Control
Second, they address less control
incomplete information by
increasing transparency in Talent Management Lever:
the relative strengths of peers Leader Development
and teams, not just updating
universal competency models.
Finally, they reduce rewards

risk by rewarding leaders Increasing transparency into
Incomplete Updating universal expectations
for Enterprise Leadership relative strengths of peers
outcomes, not just Enterprise
Information through new leadership models
and teams
Leadership behaviors.
Talent Management Lever:
Leader Assessment and Role Design
Rewarding leaders for

Rewards Rewarding leaders for
Enterprise Leadership
Risk Enterprise Leadership behaviors
outcomes
Talent Management Lever:

Leader Rewards

Organizations that implement
the three strategies outlined
REMOVING ECONOMIC COSTS CREATES MORE
on the previous page can
substantially increase leaders’
ENTERPRISE LEADERS
Enterprise Leadership
effectiveness. Enterprise Leadership Gains Available
Maximum Impact on Enterprise Leadership Effectiveness of Different HR Strategies a
The dark blue bars in the
graphic show the maximum Strategies to Address
Economic Costs
impact of each strategy
16%
on Enterprise Leadership 15%
effectiveness: 12%, 9%, and 15%
Maximum Impact on Enterprise Leadership Effectiveness

respectively.
In contrast, more common HR

strategies such as updating 12%
12%
competency models or
changing hiring processes have
a negligible effect on Enterprise
Leadership. 9%
8%
Increase Enterprise Leaders

by 4x
By removing all three economic Common HR Strategies
costs, organizations can
quadruple the number of
<0%
1% <0%
1% 0%
< 1% <0%
1% 0%
< 1% 1 2 3
Enterprise Leaders (from 12% of
0%
the leader population to 47%). l s
y
nc nd na g to ce �� Teamses et s cy e
is ,
We determined this by applying te a s i t i o i n s es ew e n an nd s
a -S ole ren ths r pr es s
s N l s d
the maximum impact of each pe ls ue ad ai
n
ce or ofi er s tie ng e in r R pa ng te om ior
o m de Val Tr Tr ro t f Pr ov ole bili n gi roc ’ M hei a ns tre En utc av
C o l g p P G R i a P s r S d h
strategy to each participating g M na in hi ec ce g e ns
Ch ork
r T
de ut
T
e tive ar p O Be
it n it o v id ers r i ng Sel an h in ye po a s ew h i t
leader’s Enterprise Leadership a za
o d i
H nd rm lis plo es W Le bo
a a
re el R rs Jus
pd ni Pr ea o ab Em R ift A nc o R
e
score and observing the number U a L i ng t a erf t
s r h I t e ad Not
rg g c P E S i n L
of leaders for whom the impact O an ttra ire fo
Ch A H
on their scores was enough n = 908.
to qualify them as Enterprise Source: 2014 CEB Enterprise Leadership Survey.
a
The maximum impact on Enterprise Leadership is calculated by comparing two statistical estimates: the predicted impact when a leader scores relatively high on a driver and the
Leaders. predicted value when a leader scores relatively low on a driver. The effects of all drivers are modeled separately, using a variety of multivariate regressions with controls.
Note: To determine whether a leader is an Enterprise Leader, we measured leaders’ effectiveness at a set of individual and network leadership activities (see Appendix for details).
© 2015 CEB. All rights reserved. HRFR3701715SYN Leaders who received an average rating of 4 on a five-point scale (2 = highly ineffective, 5 = highly effective) were designated as Enterprise Leaders.
CREATING ENTERPRISE LEADERS
I. Shift Mind-Sets to II. Increase Transparency to III. Redesign Evaluations
Adapt to Lack of Control Address Insufficient Information to Reduce Rewards Risk
Build Transparency into Relative
Help Leaders Change Their Mind-Sets, Reward Enterprise Leadership
Strengths, Rather Than Just
Rather Than Just Building New Skills Outcomes, Not Just Behaviors
Clarifying Universal Expectations
Experienced Leaders Challenge Leadership Capability Clouds Network Performance Points
Leader Guide: Apply an Enterprise Portfolio Reviews Horizontal Goal Cascade

Leadership Mind-Set to Work Activities
Leader Guide: Understanding Span of Influence Mapping

Your Fit in the Leader Network
Cross-Divisional Partnership Review
Leader Guide: Identifying

Opportunities for Peer Contributions
APPENDIX APPENDIX APPENDIX
Enterprise Leadership Predictors Relationship-Based Role Charters Interactive Enterprise Leadership Evaluation

CREATE ENTERPRISE LEADERS BY ADDRESSING THREE ECONOMIC COSTS
Key Takeaways and Implications for Heads of HR
Key Takeaways Implications for Heads of HR
■■ Only 27% of business units have the leaders they need for the future; ■■ Focus on making all leaders Enterprise Leaders to achieve breakthrough
in fact, one-third of HR leaders would replace members of their senior performance in the new leadership environment.
leadership team if given the opportunity.
■■ Instead of focusing on building leader role models, updating competency
■■ Leaders’ average effectiveness at key competencies remains relatively models and organizational values, and training leaders on these new
unchanged, but the environment in which leaders must perform has models, reduce the economic costs of Enterprise Leadership.
shifted significantly.
■■ By shifting leaders’ mind-sets about their roles, maximizing the
■■ The leaders who are most effective in today’s new leadership transparency of peers’ and teams’ relative strengths, and rewarding
environment are Enterprise Leaders; they lead their teams to high Enterprise Leadership outcomes, organizations reduce the economic
performance as well as contribute to and leverage the performance costs of Enterprise Leadership and can create up to four times more
of other units and teams. Enterprise Leaders within their organizations.
■■ Enterprise Leaders can improve their business units’ revenue by 7% and

also receive an additional 5% improvement through the contributions of
other Enterprise Leaders.
■■ Enterprise Leaders are differentiated by three key shifts in their

leadership:
–– They take from and give to their peers.
–– They push contributions to and pull contributions from their teams.
–– They facilitate, not just direct, team performance.
■■ Although most leaders believe in the value of Enterprise Leadership,

three economic costs deter them from becoming Enterprise Leaders:
–– Lack of Control—Enterprise Leadership requires leaders to adapt
to managing with less autonomy and control than before.
–– Incomplete Information—The new requirements for Enterprise
Leadership make expectations for success uncertain.
–– Rewards Risk—Enterprise Leadership puts leaders’ personal
rewards at risk.
■■ Organizations that address these three economic costs can quadruple

the number of Enterprise Leaders in their organization.

FIVE CONSIDERATIONS FOR THE HEAD OF HR
A new leadership environment where leaders’ relationships with peers and teams are more complex
and less predictable has several implications for the head of HR. In particular, heads of HR should
consider the following:
Am I accurately communicating future leadership needs and challenges to the CEO and board
1 of directors?
Which of the economic costs is making it difficult for our leaders to behave like Enterprise
2 Leaders?
How should I engage with my peers on the executive team to address economic costs of
3 Enterprise Leadership?
4 How can we support our leaders’ managers as they adjust to the new leadership environment?
Which of our current HR strategies could we set aside to redirect resources toward addressing
5 the economic costs of Enterprise Leadership?

CEB ENTERPRISE LEADERSHIP SOLUTIONS
How We Can Help
Enterprise Leadership Key Benefits

Assessment
■■ Get an individual and organizational view of
Assess and benchmark your leaders against our new your leaders against the drivers of Enterprise
Enterprise Leadership competency model. Leadership performance.
■■ Compare your leaders to industry, geography,
and leadership segment benchmarks.

Development
■■ Equip leaders with frameworks and tools to shift
Increase leaders’ ability to model and enable leader and team behavior toward Enterprise
Enterprise Leadership. Leadership.
■■ Build leaders’ ability to create team-focused
communication and action plans to activate

Best Practice & Decision Support
■■ Gain an insight-driven perspective on key drivers
Review leadership insight and best practices, of Enterprise Leader performance.
and apply them at your organization. ■■ Apply decision guidance and use tools to help HR
implement Enterprise Leadership programs.
For more information, please visit cebglobal.com/leadership or contact your account manager.

Chapter I: Shift Mind-Sets
to Adapt to Lack of Control
27



Chapter I: Shift Mind-Sets to Adapt to Lack of Control 28

Leaders have less autonomy
and control over their work
LEADERS TODAY HAVE LESS AUTONOMY AND CONTROL
and their teams in today’s
work environment. These Leaders Must Work More Closely with Peers Leaders Spend Less Time with Their Direct
charts illustrate how leaders to Complete Their Work Reports
are experiencing reduced Percentage of Leaders Who Agree That the Number Number of Hours per Week Employees Spend
autonomy and control in their of Individuals They Must Consult or Obtain Approval with Their Direct Leader
roles. From to Make a Decision Has Increased
■■ Less autonomy over work 6 Teams spend half

projects: Sixty-one percent of the time they
used to with
leaders agree that the number 3 their leaders.
of individuals they must consult 61%
with or obtain approval from Agree
before making a decision has
increased. 2012 2014
n = 908. n = 23,339 (2012); 908 (2014).
■■ Less control over team Source: CEB 2012 Enterprise Contribution Survey.
activities: Employees today CEB 2014 Enterprise Leadership Survey.
spend three hours a week with

their direct leader, which is half Implication: Leaders have less autonomy over their Implication: Leaders have less control over their teams’
the time they used to spend. work projects. activities.
■■ Less ability to rely on past
experience as the basis of
authority: More than 60%
Leaders Face More Situations That Are New
of heads of leadership
to Them
Percentage of Heads of Leadership Development
development agree that line
Who Agree That Leaders Face More Unexpected
leaders are facing more new
Situations Now Than Three Years Ago
situations.
64%
Agree or
Strongly Agree
n = 68.
Source: CEB 2013 Head of Leadership Development Survey.
Implication: Leaders are less able to rely on past

experience to determine how they will respond to work
challenges.

Many organizations focus on
skill development to help leaders
LEADERS HAVE THE SKILLS, BUT NOT THE MIND-SET,
adapt to the reduced autonomy
and control of the new work
FOR ENTERPRISE LEADERSHIP
environment. Heads of HR rate
“strengthening leadership skills” Most Leaders Demonstrate Sufficient …But Many Leaders Have Outdated Mind-Sets
as their top goal. However, most Effectiveness at Common Leadership About Autonomy and Control
leaders already have the skills Competencies… Percentage of Leaders Agreeing That Autonomy
they need to lead effectively Leaders’ Effectiveness at Key Competencies and Control Are Critical to Their Success
in today’s environment. In fact,
more than two-thirds of leaders
demonstrate effectiveness at key
leadership competencies such as
problem solving and agility.
Although room for improvement

exists, skills are not the biggest
barrier inhibiting leaders’ ability 67% 66%
to adapt to reduced autonomy Effective Agree
and control. Rather, leaders’
mind-sets are holding them
back. More than half of the heads
of HR we surveyed expressed
a high level of concern about n = 908.
leaders’ mind-sets. As the
data and quotes on the right 100%
illustrate, those concerns are 81%
not unfounded. Two-thirds of 74% 71% “The organization has become so complex;
69%
the leaders we surveyed believe 58% teams need really specific direction and
autonomy and control are crucial 46% oversight now more than ever.”
50%
to their success.
Director
Technology Industry
0%
“I see the organization becoming more
g
n
en
lit
tio
tio
io
in
interconnected, but I have to be able to

gi
t
lv
em
ca
ra
va
So
bo
no
llo
ag
protect resources for my business unit in

m
la
A
In
an
le
ol
e
M
ob
order to hit our goals.”

rc
C
nt
ou
Pr
le
es
Ta
R
SVP
n = 333.
Source: CEB 2013 Leadership and Development Survey.
Health Care Industry

To shift leaders’ mind-sets,
organizations must help them
CHANGING LEADER MIND-SETS IMPROVES ENTERPRISE
see their roles differently, not just
prescribe a new set of behaviors.
LEADERSHIP
Organizations that help Changing Leader Mind-Sets Significantly Improves Enterprise Leadership
leaders change their mind- Maximum Impact of Improving Leader Mind-Sets on Enterprise Leadership
sets to align with the current
leadership environment can
improve Enterprise Leadership
effectiveness by as much as 12%.
12%
Maximum
Impact on Individual Leadership Mind-Set Enterprise Leadership Mind-Set
Enterprise I can achieve success on my own. I depend on my peers and team
for success.
Leadership
To shift leadership mind-sets, organizations must help

leaders self-discover how their roles should change, not just
tell them what they should do differently.
n = 197.
Source: CEB 2014 Enterprise Leadership Head of HR Survey.
Note: The impact on Enterprise Leadership is calculated by comparing two statistical estimates: the predicted impact when a respondent rates a
driver with a relatively high score and the predicted value when a respondent rates a driver with the relatively low score. The effect of the
drivers on Enterprise Leadership is modeled using a variety of multiple regressions with controls.

EXPERIENCED LEADERS CHALLENGE
OVERVIEW
General Electric Company (GE) recognized that a fundamental shift in the work environment necessitated a new
leadership strategy and mind-set. To address this shift, GE’s Experienced Leaders Challenge (ELC) convenes GE’s
tenured, high-performing leaders and challenges them to identify and address barriers to enterprise contribution that
they and their teams are facing in today’s complex environment.
SOLUTION HIGHLIGHTS
■■ Reset Leader Assumptions Through Self-Discovery Exercises

ELC activities help leaders adopt an Enterprise Leadership mind-set through leader self-discovery of how their actions
shape the environment in which they and their teams perform.
■■ Reinforce an Enterprise Leadership Mind-Set Through Elective Learning Teach-Back Session
Small-group “teach-back” sessions require leaders to translate elective experiences into specific, personally relevant
takeaways and next steps for their teams.
■■ Activate an Enterprise Leadership Mind-Set Through Business Simplification Projects
Leader-identified business simplification challenges ensure leaders apply their learning in a way that supports the
broader organizational objective of increasing customer value through simplicity.
COMPANY SNAPSHOT
General Electric Company

Industry: Diversified Products General Electric is a multinational technology and services corporation
and Services headquartered in Fairfield, Connecticut. The company operates within the
2013 Revenue: US$146 Billion Energy, Healthcare, Oil & Gas, Aviation, Transportation, Financial Services,
2013 307,000 and Consumer Product segments, among others.
Employees:
Key Regions North America, South
of Operation: America, Europe,
Asia–Pacific, Africa,
and the Middle East

Rather than provide training
on new skills, GE aims to
A NEW PARADIGM REQUIRES A NEW
challenge leaders’ assumptions
about their role in driving
LEADER MIND-SET, NOT JUST NEW SKILLS
organizational performance. GE
does not approach the shift like
flipping a switch; examples of
both paradigms exist within GE
and the broader environment.
Leaders are challenged to

recognize the paradigm(s) in
NEWTONIAN PARADIGM CHAOS PARADIGM
NEW
their environment and apply
OLD
the appropriate strategies to The work environment is predictable and The work environment is inherently
lead effectively in that context. follows a fixed, commonly understood set unpredictable; order is spontaneous
As a result, the ELC focuses on of rules. and self-organized.
building a new mind-set, rather
than a new set of tools.
“Newtonian” Leader Strategies: “Chaos” Leader Strategies:
■■ Provide clear directives. ■■ Balance direction and autonomy.
■■ Standardize process. ■■ Create a collaborative team climate.
■■ Cascade information to the team. ■■ Ensure information flows across the team.
Hierarchical Leadership Mind-Set Enterprise Leadership Mind-Set

Individual performance through a focus Enterprise contribution through using
on leader-owned resources and priorities and contributing value throughout the
organization
Source: General Electric Company; CEB analysis.
“We have great leaders.

They are not coming to
the ELC because they
are ‘broken,’ but instead to learn
how to apply their toolkit of skills
in this new environment.”
Rich Rischling
SOLUTION
Faculty Leader CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

The ELC is a week-long,
immersive development session
OVERVIEW OF GE’S ELC
for experienced GE leaders
that takes place at the GE ELC Program Structure
Crotonville campus. The graphic
on this page provides a high-
Pre-Session On-Campus Experience Post-Session
level overview of the program’s
structure and content.
~Two Months One Week ~Six Weeks
Each cohort consists of Invitation to ELC
approximately 50 high- Immersion Exercise:
performing leaders from Leadership Leadership in Chaos Simplification Project
Assessment (360) and Complexity Implementation/
throughout GE, nominated
Progress Updates
through the annual Simplification Challenge Simulation Exercise:
organization and staffing Identification Team-Based Challenge Executive
review (“Session C”) process. Coaching Session 2
Executive Personal Learning Electives
Self-assessment, coaching, and Coaching Session 1
prep work prior to the session
ensure leaders are prepared,
and additional coaching and Group activities and discussion orient
project planning after the leaders to the new paradigm.
session support leader action Small teams compete to turn around
based on their learning. a struggling business.
Each participant attends two of six
elective learning options and facilitates
a discussion with the broader group.
1 Leader Self-Discovery Exercises

GE Crotonville
2 Elective Learning Teach-Back Sessions
GE Crotonville, the company’s
leadership development
3 Business Simplification Projects
institute, plays a vital role in
shaping corporate aims and
fostering individual growth.
Crotonville courses, such as
the ELC, illustrate the power
of transformational learning in SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
today’s complex environment. OVERVIEW

ELC activities help leaders
adopt an Enterprise Leadership
LEADER SELF-DISCOVERY EXERCISES RESET
mind-set through self-discovery
of how their actions shape the
LEADER ASSUMPTIONS
environment in which they and
their teams perform. ELC Activities Help Leaders Connect Individual Actions to Organizational Performance
Reflection before, during, and
after the on-campus experience
facilitates leader self-discovery
Pre-session coaching and Experiential Personal A simulation exercise
of the connections between
simplification project Learning Electivesa help lets leaders practice
environmental barriers and their
identification help leaders leaders see where legacy navigating common
own attitudes and behaviors. styles and strategies may be
articulate challenges challenges and observe
they’ve experienced within creating or failing to remove unexpected consequences
In addition, a small-group
themselves, the organization, barriers to their performance and of their decision or actions.
simulation exercise throughout
and the environment. the performance of their teams.
the week reinforces what leaders
have learned by requiring them
to apply new concepts and
approaches to successfully
navigate a business challenge.
The exercises provide highly
personalized results for each Leaders articulate how complexity is affecting …and reflect on their role in supporting performance
leader, not a standard list of performance for themselves and their teams… in the new paradigm.
challenges to address. Sample Barriers Sample Leader Reflections
■■ Structure or process changes within one team ■■ Am I considering all relevant groups when
that disrupt another team designing process?
■■ Inflexible structures and processes ■■ Are my attempts to keep work predictable
hindering my team’s performance?
■■ Misaligned goals, performance metrics,
and incentives ■■ Do I sufficiently reward collaborative behavior?
■■ Challenges working productively across ■■ Do I think of peers across the matrix as members
“As leaders, they set the the matrix of my team?
culture, so they can’t talk Source: General Electric Company; CEB analysis.
about it as some a
Session details can be found in the Implementation Guide.
immovable thing. They need to
understand how their behaviors
and actions set the culture for
those around them.”
Rich Rischling
SOLUTION
OVERVIEW

Small-group teach-back
sessions reinforce an Enterprise
ELECTIVE TEACH-BACKS REINFORCE A NEW
Leadership mind-set by
requiring leaders to translate
MIND-SET THROUGH LEADER-OWNED TAKEAWAYS
personally relevant takeaways
and next steps for themselves Each Leader Participates in Two of Six Experiential Learning Electives During the Week
and their teams.
ELC electives are highly SESSION OPTION 4: FINE-TUNING YOUR COLLABORATION APPROACH
experiential, requiring leaders Session Description: You can learn a lot by seeing how artists collaborate. This session takes you inside
to extract their own personal a chamber music rehearsal.
takeaways.1 During the teach-
back sessions, participants from Sample Takeaways for Discussion:
each elective session share their ■■ ollaboration begins with shared passion for the same outcome. Effective teams are made up of individuals who
C
experience and facilitate an in- share a personal commitment…
depth discussion of takeaways ■■ eadership on high-performing teams shifts and flows in the moment, rather than being predetermined or locked
L
and implications. into fixed hierarchies…
Participants can use online
resources that provide general Source: General Electric Company; CEB analysis.
takeaways and talking points

Participants from Each Session Facilitate In-Depth Discussion with Their Larger ELC Team
from each session to help
guide discussion. In addition,
executive coaches are present 2 Facilitate leader self-
discovery of implications.
and can provide support if
needed, but ideally they are
“We tend to compose teams
minimally involved.
1 Translate the experience into
key takeaways for the group.
of all ‘A’ players without
considering ensemble players.
This is hindering collaboration.”
3 Identify solutions to take
back to the business.
“I realized that leadership on a “I am going to change the way I think

high-performing team can shift about setting up project teams in my
and flow as needed, depending business to ensure that leadership can ebb
on the situation.” and flow as needed during the project.”
“With leaders at this
level, it’s difficult to be ELC
Group A
prescriptive. We aim to
give them food for thought and
time to reflect to challenge the
way they have been approaching Teach-Back Session: Fine-Tuning
Your Collaboration Approach
things and consider alternate
approaches.” 1
More details on the ELC’s Personal Learning Electives can be found in the Implementation Guide.
Rich Rischling
SOLUTION
OVERVIEW

Leader-identified business
simplification challenges ensure
BUSINESS SIMPLIFICATION PROJECTS ENSURE
leaders apply an Enterprise
Leadership mind-set to
LEADERS PUT THE NEW MIND-SET INTO PRACTICE
support broader organizational
objectives.
A business simplification challenge is a process, initiative, or part of the business that needs to be simplified to
HR identifies strong improve customer service, reduce bureaucracy, or increase the value of the business’ efforts.
simplification challenges
based on their relevance to
the business, interdependence Sample Business Simplification Challenges
with others, and overall impact. Illustrative
Two illustrative examples are
provided on the left of the
ELC Participant: Joe C.
graphic.
GM, GE Capital Three Criteria of a Strong Business
Simplification Challenge
Making the Matrix Work
I intend to change the dynamics of the 1. RELEVANCE: The challenge should be
organizational matrix to create more alignment strategically important to the business’s
among commercial teams and internal success.
departments.
2. INTERDEPENDENCE: The challenge
should extend across multiple groups,
requiring cross-functional collaboration
ELC Participant: M
aria E. to solve.
Managing Director,
3. IMPACT: Solving the challenge should
GE Transportation
enable the business to bring more or new
Empowering the Project Manager value to the customer, not a cost-outa.
I propose a complete reimagination of the project
management role. By shifting the focus of the
role from process to…the organization could more
readily prioritize high-value efforts and fulfill the
“These individuals have customer’s needs more efficiently.
some of the toughest
jobs in the company…
Note: More detail on GE’s simplification project process can be found in the Implementation Guide.
but they also have the most a
A cost-out is an initiative that simply removes cost from the business (e.g., head count reduction) without necessarily eliminating work or creating value.
critical span of influence in terms
of driving a simpler and more
customer-focused culture.”
John Wisdom
SOLUTION
Manager, Leadership Communications CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

In its first year, nearly 300
senior leaders have completed
CHANGING LEADERS’ MIND-SETS DRIVES NEW
the ELC.
WAYS OF WORKING ORGANIZATION-WIDE
The ELC has received highly
positive feedback and has led Sample Leader Feedback Leader Change/Success Examples
to tangible changes in leader
behavior and business results.
In addition to benefits realized Making the Matrix Work
from individual simplification “[ELC] truly made me reflect on Proposal: Change the dynamics of the matrix
projects, supporting a new to capitalize on a new market opportunity.
myself as a leader…am I creating the
leadership mind-set has Action: Assembled a cross-functional group to
culture desired, removing barriers and
helped lay the foundation for challenge the existing organizational structure and
success achieved in broader simplifying, being mindful and focusing develop a new go-to-market strategy
simplification initiatives. on positive feedback [to leverage the
Results:
strengths of the team]?” ■■ Established greater alignment among the client-
facing teams and internal departments
■■ Promoted a change-oriented mind-set that balances
long-term planing with day-to-day agility
■■ Improved service to a growing customer segment
Leader Mind-Set Changes Support Behavior Change
“We are building leaders who are asking 14 April 2014 General Electric Fastworks can
questions, challenging the status quo, Jeff Immelt Wants to Act save several
and getting more comfortable with Chairman, CEO Like a Startup million dollars
General Electric Company in development
learning from mistakes. This new way
GE has costs…meaning
of working enables them to engage “…simplification efforts are enlisted tech billions in possible
more employees in broader efforts. ” paying off. We generated
about $250 million of
entrepreneur
Eric Ries to
savings.
Rich Rischling structural costs out of the help develop

FastWorks…to —Richard Clough
Faculty Leader quarter…and had a positive August 2014
speed the rollout
General Electric Company 50 basis-point impact on BusinessWeek
of products.
Source: General Electric Company; CEB analysis. margins.”
SOLUTION
OVERVIEW

EXPERIENCED LEADERS CHALLENGE: IMPLEMENTATION CHECKLIST
1. Design Program Content and Experience
ather input from current leaders, HRBPs, and external literature to identify the assumptions most prevalent among current leaders.
G
Review current internal leadership development programs to identify key opportunities to differentiate from existing programs.
Identify structural elements of the program that will challenge leaders.
Maximize leaders’ exposure to different approaches, provide time for reflection, and give leaders responsibility for defining takeaways, not just
consuming content.
Tip: Make the leader experiences as unconventional or removed from the business world as possible, where leaders will be unable to default to their
own habits or assumptions.
Define the parameters of the business projects that leaders will identify before, refine during, and implement after the experience.
Tip: Use project parameters as a way to push leaders outside their comfort zone and challenge their assumptions. For example, require that the challenge
be shared across functions, rather than something one function can address internally.
If using a simulation exercise, identify a vendor partner or determine a process and ownership for designing the simulation internally.
2. Identify and Prepare Program Participants
Define the criteria for participant selection (e.g., role, tenure, performance).
Select leaders with moderate to long tenure in the organization who are likely to have long-held, strong assumptions about what will lead to success
in their role.
Tip: Consider making the program available to high-performing leaders only to position it as aspirational and clarify the goal of supporting great leaders
in the new work environment versus teaching struggling leaders new skills. Underperforming leaders should be provided with resources and interventions
targeted to their specific needs.
Inform participants about the program and associated pre-work.
Assign an executive coach to each participant to support pre-work and self-reflection.
Focus reflection conversations on uncovering assumptions about work, which can be used to guide conversations during the session.
Tip: If dedicated internal or external coaches are not available, consider using HRBPs for the executive coaching role.
3. Facilitate the Program
Convene leaders in moderately sized cohorts of 20–30 leaders.

Tip: Determine cohort frequency and timing based on the organization’s size as well as current business processes and priorities.
Tip: Consider holding the training off-site to help leaders fully immerse themselves in the experience.
After elective/breakout sessions, require leaders to define takeaways and implications for their team through small-group teach-back sessions.
Tip: Include executive coaches in the small-group sessions to help guide conversations if needed.
Deploy a participant survey shortly after the experience to gather leader feedback and identify areas for improvement.
Tip: Gather feedback about leaders perceptions or assumptions about their role before and after the session.
Track progress against individual projects to ensure completion and to measure results and benefits achieved from a mind-set shift.

LEADER GUIDE: APPLY AN ENTERPRISE LEADERSHIP MIND-SET
TO WORK ACTIVITIES
Instructions: Review the questions below for each leadership activity, and place a checkmark next to the questions that you rarely consider during your day-to-day work.
Incorporate the selected questions into recurring leadership activities on your weekly calendar.
Sample Activities Receive Support from Others Provide Support to Others
Team Meeting Who would have unique insight to inform agenda items in today’s Are there colleagues I can invite who could provide insight on how to
meeting? overcome a challenge my team is facing?
Are there team members I can ask to manage discussion of agenda items What context can I share that would help my team better understand
for which I am not the expert? recent corporate communications?
Budgeting/ Which of my planning assumptions should I pressure-test with my What aspects of my strategic plan could affect other groups?
Administration peers? What organizational priorities does my team have the capacity
Have I asked my team how they prioritize resource needs for next year? to support?
Talent Are there any obvious skill gaps on my team, and in what ways could job How can I regularly recognize and reward team members who support
Management candidates’ skills and knowledge complement those gaps? other functions or business units?
How can I change how I work based on the performance feedback I Does the performance feedback I provide support team members’
receive from others? individual and network performance?
Individual Tasks How can I use support from others to help get my work done? What projects can I delegate that would be valuable development
Can any of my tasks be automated or expedited by working with other opportunities for others?
teams? Who across the organization is working on similar projects that could
benefit from my work?
Leadership How can I clarify colleagues’ roles in meetings to ensure our time is used What questions can I ask to push the boundaries of my peers’ thinking?
Meetings productively? What relationships can I proactively strengthen to support my team’s
What challenges or priorities do peers and I have in common where performance?
partnering would be mutually beneficial?
Project Which team members can I ask to own parts of the project planning How could aligning my timelines with other groups potentially help my
Management process? team and others?
Do the project teams that I lead or support have sufficient representation What are other groups most dependent on my team for, and how can
from all major groups that the project will influence? I plan to avoid letting other groups down?
Direct Report What opportunities are there for my direct report to coach me on a new Am I aware of potential tensions or conflicts that may exist between team
One-on-One skill I need to be successful? members or with other work groups?
Action Steps: Use this guide as a refresher before key meetings or interactions; discuss this guide with your HRBP to identify particular areas of focus for continued improvement.

SHIFT LEADER MIND-SETS TO HELP LEADERS ADAPT TO THE LACK
OF CONTROL
■■ Most leaders demonstrate sufficient effectiveness at key ■■ Reallocate leadership development budget to focus on mind-
competencies, but few have the right mind-set for leadership sets, not just skills.
with reduced autonomy and control.
■■ Create a new performance objective for HRBPs focused on
■■ To shift leadership mind-sets, organizations must help leaders helping leaders identify opportunities to apply an Enterprise
self-discover how their roles should change, not just tell them Leadership mind-set.
what to do differently.

A leadership environment where leaders need a new mind-set to adjust to lack of control has several
implications for the head of HR. In particular, heads of HR should consider the following:
1 Do I have a clear understanding of our leaders’ current mind-sets?
2 How can I adjust our leadership development strategies to change mind-sets, not just skills?
Do our leadership development programs challenge leaders’ assumptions about how they should
3 work with their direct reports and peers?
4 How should the HR function measure progress against our leaders’ mind-set shift?
How well equipped are my HRBPs to help our leaders identify opportunities to apply an
5 Enterprise Leadership mind-set to their current tasks and responsibilities?

Chapter II: Increase
Transparency to Address
Insufficient Information
43



Chapter II: Increase Transparency to Address Insufficient Information 44

Competency updates do
not sufficiently help leaders
NEW LEADERSHIP MODELS DON’T PROVIDE SUFFICIENT
understand how to be
Enterprise Leaders. Although
INFORMATION ABOUT ENTERPRISE LEADERSHIP
they provide general guidelines
for behavior, they do not help Leaders Still Uncertain How to Fulfill New Leaders Lack the Information Needed
leaders map their capabilities to Expectations to Support and Use Their Peers
the needs of colleagues and the Sample Updated Leadership Competency Model Percentage of Leaders Who Understand How
broader organization. Only 37% Their Work Contributes to Their Peers and
of leaders understand how their the Organization
work contributes to their peers
and the broader organization, Alpha Company
and only 39% understand how Leadership Competency Model—2014
their teams’ work contributes 37%
to other teams and the broader ■■ Drives for results. of Leaders
Understand
organization. How Their Work
■■ Takes initiative.
Contributes to Their
■■ Manages through change. Network and
the Organization
■■ Demonstrates technical/professional expertise.
■■
■■ Collaboratesproductively
Collaborates productivelywith
withpeers.
peers.
––– Frequently
– Frequentlycommunicates
communicateswithwithstakeholders
stakeholders n = 2,101.
Source: CEB 2014 Enterprise Contribution Workforce Survey.
across departments
across departments
– – Takesadvantages
–– Takes advantagesof ofrelationships
relationshipsto
tomeet
meet
Leaders Lack the Information Needed to Help
strategic objectives
strategic objectives Their Teams Support and Use Peers
––– Shares
– Sharesexpertise
expertisethroughout
throughoutthe
theorganization
organization Percentage of Leaders Who Understand How
Their Teams’ Work Contributes to Peers and the
––– Puts
– Putsthe
theinterests
interestsof
ofthe
thebroader
broaderorganization
organization
Organization
first
first
39%
of Leaders Are
Able to Connect
Their Teams’ Work
to Colleagues and
Activities Throughout
the Organization
n = 2,101.

When leaders lack sufficient
information about how their
INSUFFICIENT INFORMATION HINDERS ENTERPRISE
work and the work of their
teams connects to others,
LEADERSHIP
multiple breakdowns can occur:
■■ Limited contributions—Leaders
may simply avoid contributing
to others and remain focused Possible Responses of Leaders Consequences Observed by HR
on individual work where the and Their Teams
potential for impact from their
efforts is clear.
Limited Contributions Missed opportunities to improve performance
■■ Misdirected contributions—
“Leaders aren’t going to share resources and time
Leaders may contribute the
on the off-chance it adds value. You need to be
wrong things to the wrong
able to tell them exactly what is needed and why.”
people, wasting time and
causing frustration among
leaders who feel that their
contributions were not valued.
■■ Excessive contributions— Misdirected Contributions Misdirected/wasted resources; leader frustration
Leaders may take the lack of “Leaders contribute to others with good
clear direction as a cue to have intentions, only to learn that it wasn’t used or
as much input into others’ wasn’t what was needed; it’s incredibly frustrating
work as possible, generating and makes those leaders unlikely to share again.”
lots of activity but little value.
This approach wastes time
and resources and may limit
peers’ receptivity to future
Excessive Contributions Wasted time and resources; reduced receptivity
contributions.
“Many leaders took this as a cue to simply push
their ideas and accomplishments as much as
possible; there’s lots of ‘sharing,’ but not a lot of
value.”

Rather than help leaders
understand their gaps against a
HELP LEADERS UNDERSTAND HOW THEY COMPLEMENT
universal standard, organizations
must help leaders understand
PEER CAPABILITIES AND SUPPORT BUSINESS NEEDS
how they and their teams can
best support their colleagues Help Leaders Contextualize New Expectations for Success
and the needs of the business.
Beyond universal competency

standards, leaders need Fit with Peer Capabilities: How individual leaders Fit with Business Needs: How leaders‘ and teams’
more transparency about contribute to and use peer and team capabilities capabilities align with the organization’s strategic
the organization’s overall objectives, stage of maturity, and environmental context
relative strengths and needs to
contextualize how they can be
successful Enterprise Leaders. M P
an ro
ag jec
gh er
First, leaders need to understand em t
si m
t
In sto
the specific relationships that I en
Pe nno t
Cu
add value, opportunities to use rs va
pe ti Alpha Company
complementary skill sets, and the ct ve
na ta
s
si
A Da
iv
ly
overall capability of their network. e
Second, Enterprise Leaders

need to understand their fit with I Business Unit 1 Business Unit 2 Business Unit 3
Pe nno
gh er
business needs. This includes ■■ High Growth ■■ Mature ■■ Start-Up
rs va
si m
pe ti
t
priorities and drivers of success
In sto
■■ Technical ■■ Highly ■■ Few
ct ve
n
iv
Cu
for their business units’ particular Co
ill tio
e Regulated Competitors
a
Sk nta
situations and contexts, not a one- Sk ch
s
ill ing
size-fits-all description of good e
es
s
Pr
leadership.
efines specific relationships with individual

D efines success factors for the specific business
D
colleagues situation in which the leader is operating
upports complementary and reciprocal

S Directs work toward specific, high-stakes objectives
relationships
rganizes the key strategic priorities in need of
O
rovides insight on group, not just individual,
P support
capability

Clarifying leaders’ fit with peer
capabilities and business needs
INCREASE TRANSPARENCY OF RELATIVE STRENGTHS,
can improve Enterprise
Leadership effectiveness by as
NOT JUST UNIVERSAL STANDARDS
much as 7% and 9%, respectively.
In comparison, we found that Increasing Transparency of Relative Strengths Has Greater Impact
updating an organization’s Than Updating Leadership Competency Models
competency model alone has a Maximum Impact of Information-Based Strategies on Enterprise Leadership
negligible impact on Enterprise
Leadership effectiveness.
10%
9%
Maximum Impact on Enterprise Leadership
7%
5%
<1%
1%
0%
Updating Universal Clarifying Capability Clarifying Capability Fit
Leadership Competencies Fit with Peers and Team with Business Needs
n = 197.
Note: The impact on Enterprise Leadership is calculated by comparing two statistical estimates: the predicted impact when a respondent rates a
driver with a relatively high score, and the predicted impact when a respondent rates a driver with a relatively low score. The effect of the
drivers on Enterprise Leadership is modeled using multiple linear regression with controls.

TWO IMPERATIVES TO INCREASE TRANSPARENCY OF RELATIVE STRENGTHS
1 2
Increase Leaders’ Knowledge Help Leaders Increase Teams’
of Relative Strengths Knowledge of Relative Strengths
Optimize capabilities across Equip teams to self-identify enterprise

leadership teams, rather than trying contribution opportunities, rather
to perfect individual capability. than just cascading them down.
Leadership Capability Clouds Portfolio Reviews

LEADERSHIP CAPABILITY CLOUDS
OVERVIEW
Cisco built a successful new leadership model in 2007 when HR and executives worked together to co-create leadership
expectations needed for the company’s business strategy. Cisco recently overhauled the model as it realigned itself
to better capture new market transitions. The model has been extended to include “clouds” of leadership capability
throughout the organization, rather than trying to optimize all capabilities in every individual leader. The situation-
specific approach will allow Cisco to deploy and support the best leaders for particular business, locale, or market/
technology transitions.
SOLUTION HIGHLIGHTS
■■ Build Transparency into Individual and Team Capability

Transparent assessments and development conversations help leaders understand how their unique skill profiles fit into
the mix of capability throughout the function and the organization.
■■ Maintain the Balance of Capability Throughout the Organization
Rather than focus exclusively on development interventions, Cisco takes advantage of leadership strengths across the
talent portfolio to ensure the right mix of capability in different parts of the business.
■■ Sustain a Strong Skill Mix Over Time
Sharing the updated leadership model in all levels of the organization provides a clear model of success for future
leaders and improves top-down and bottom-up visibility across multiple levels of talent.
COMPANY SNAPSHOT
Cisco Systems
Industry: Technology Cisco is a US-based multinational corporation that designs, manufactures,
Fiscal Year US$47.1 Billion and sells networking equipment. Products include routers, servers, security
2014 Revenue: devices, conferencing systems, and other networking equipment.
2013 75,049
Employees:
Key Regions North America,
of Operation: South America,
Europe, Asia–Pacific

A complex and challenging
business environment
CISCO SOUGHT TO BETTER MATCH LEADER
prompted HR to reexamine
Cisco’s leadership model
CAPABILITY WITH BUSINESS NEEDS
and revealed an opportunity
to better match existing
leadership capability to HR Facilitated Leader Identification of Challenges and Opportunities in the Context of Business Strategy
business needs. More than 200 executive leaders HR engaged the HRPa community HR benchmarked Cisco-specific
participated in HR-facilitated through a series of focus groups. insight through broader
HR supported a leader- conversations. external research.
led investigation of current
challenges and opportunities “Given Cisco’s strategy, what
challenges will leaders face? What are
to ensure the updated the most important expectations you
leadership model reflected have of the leadership above you?”
the business’s changing needs.
During the investigation, HR
collected bottom-up and peer
perspectives in addition to Corporate HR Executive Leader
top-down expectations.
HR used Cisco’s own Opportunity: Optimize Groups of Leaders to

technology (e.g., WebEx, Support Business Needs; Don’t Just Invest in
Takeaways
TelePresence) to quickly Individual Development
engage leaders worldwide, ■■ Leadership needs vary across Illustrative
completing interviews the business.
5.0 Leader 1
and focus groups in just ■■ Diverse strengths throughout the
eight weeks. In addition, Leader 2
benchmarking against
business provide leaders with “clouds”
Leader 3
external research occurred of capability to support them in their
roles. 2.5
after synthesizing data from
Cisco’s executives and business ■■ Trying to achieve a single standard
strategy to ensure the model for all leaders results in diminishing
was kept Cisco-specific. 0.0
returns.
Competency 1
Competency 2
Competency 3
Competency 4
Competency 5
Source: Cisco; CEB analysis.
a
HRP refers to human resources partner.
SITUATION SOLUTION OVERVIEW COMPONENT 1 COMPONENT 2 COMPONENT 3

Cisco takes advantage of
leadership strengths to ensure
CISCO’S REFRESHED MODEL SUPPORTS
the right mix of capability in
different parts of the business.
CLOUDS OF LEADERSHIP CAPABILITY
Cisco’s refresh of its leadership
model builds on the model’s
2007 Accomplishments 2014 Opportunity
past success by supporting
a mix of capability throughout
the leadership population. This
new approach requires three Optimized Individual Leaders Leadership Capability Clouds
things to be successful:
Leadership behavioral transformation Don’t just try to optimize individuals
■■ Leader visibility into through: Cisco’s Leadership against every competency. Develop
organization-wide capability; Model Refresh individuals and build teams, functions,
■■ Future-focused expectations
or units with the optimal mix of
■■ A mechanism for moving talent ■■ Expectations applicable across capabilities to address business needs.
to maintain balanced capability; regions and functions
and
■■ Application of the model at all
levels of the organization to
sustain a strong skill mix over
time.
Three Imperatives to Build Leadership Capability Clouds
Build Transparency into Team Capability and Business Context

1 Transparent Leadership Assessments
Maintain the Balance of Capability Throughout the Organization

2 Leadership Deployment Decisions
Sustain a Strong Skill Mix Over Time

3 Adapted Leadership Model Cascade

Cisco’s leadership model
consists of the three pillars
OVERVIEW OF CISCO’S LEADERSHIP MODEL
illustrated on this page: C-LEAD,
the executive framework, and
functional leadership models. Three Pillars of Cisco’s Leadership Model
In 2007, Cisco drove 1 C–LEAD Model (2014 Update)

leader behavior change
by introducing differentiated ■■ Align and Influence
competencies that all leaders Collaborate ■■ Earn Trust
could apply in their day-to-day ■■ Ensure Accountability
work—Cisco’s C-LEAD model.
C-LEAD stands for “Collaborate, ■■ Learn from the Outside
Learn Develop Self and Others
Learn, Execute, Accelerate, ■■
and Disrupt;” the model was

designed to capture and align
■■ Achieve Results
leaders with evolving strategic Execute ■■ Motivate Performance
priorities.
■■ Drive Speed and Agility
■■ Align Strategy
Over the next few years, Cisco
Accelerate ■■ Create Competitive Advantage
added the executive framework ■■ Build Capability
and the functional models in
■■ Innovate
response to business needs and
changing market dynamics. The Disrupt ■■ Build Momentum
■■ Lead Change
2014 model represents a rebuilt
C-LEAD that works in synergy
with the executive framework 2 Executive Framework 3 Functional Leadership Models
and functional leadership
Corporate Function
models. Cisco Executive Competency Framework Competencies
Development Services
■■ Set vision and strategy. Competencies
(Engineering)
■■ Operationalize strategy. Competencies Sales
Competencies
■■ Communicate messages and align. Global/Regional
■■ Build capability. Competencies
■■ Operate with executive maturity.

More details on how the
Note: We profiled Cisco’s original C-LEAD model in 2009.
C-LEAD model has evolved can
be found in the Implementation
Guide.

HR uses Transparent Business
Readiness Assessments in
TRANSPARENT ASSESSMENTS ALIGN LEADERS’
conjunction with development
conversations to help leaders
CAPABILITIES WITH BUSINESS NEEDS
understand how their skills
fit into the mix of capability Business Readiness Assessment: Nora L.—VP, Engineering
throughout the function and
align with business needs.1 Engineering-Specific Competencies
In addition, the assessment Executive Framework
process provides Cisco with
C-LEAD Frameworka Engineering
an in-depth understanding of
Nora L’s Capability Profile Function
the organization’s leadership Assessment
portfolio, enabling fast and well- Results and 1 2 3 4 5 Capability Mix
Development (Necessary) (Sufficient) (Exceptional)
informed talent decisions. Plan
D
Collaborate X
5
Learn X
The assessments occur outside 3
A
Execute X C 1
the performance review process
Accelerate X
and are facilitated by CoE
Disrupt X
experts and a select group of
L E
HRPs.2 After reviewing results, Nora, VP Joe, HRP Strengths: Areas of Opportunity:
leaders and HRPs build and Engineering
execute development plans 1. _______________ 1. _______________
based on their own skill profile 2. _______________ 2. _______________
as well as the broader context
3. _______________ 3. _______________
of their function’s skill mix and
strategic needs. Source: Cisco; CEB analysis.
a
More information about Cisco’s updated C-LEAD rating scale is available in the Appendix.
Context of Business Unit Mix and Strategic Needs Directs Leader Effort
How do individual How do individual Where are the biggest
“We don’t expect all capabilities align with strengths and development opportunities to add value
the business’s strategic areas fit into the unit’s and/or seek support from
leaders to come out as needs? broader capability cloud? others?
all 5s. We need
transformational leaders that can
pave the way for more 5s, but Transparency Directs Leaders’ Efforts More Effectively
different combinations of
capabilities are going to be
important based on the needs of 1
Cisco has a suite of several types of executive leadership assessments, including the Business Readiness Assessment.
the business.” 2
HRPs and CoE experts involved in the assessment are selected for their interest in the process as well as their mix of technical skills and business knowledge.
Cassandra Frangos
Head of Global Executive Talent SITUATION SOLUTION OVERVIEW COMPONENT 1 COMPONENT 2 COMPONENT 3
Cisco

Leader deployment decisions
within Cisco take advantage
LEADER DEPLOYMENT ALIGNS CAPABILITY
of strengths across the
organization to optimize the
WITH DIVERSE ORGANIZATIONAL NEEDS
skill mix within a function or
business unit. Identifying and Managing Deployment Opportunities
Assessment results provide
Cisco with deep insight on their How does the
How are opportunities How are moves
leadership inventory, enabling organization find available
identified? structured?
strategic deployment of leaders talent for moves?
to maximize capability within ■■ Quarterly talent reviews ■■ Temporary rotations ■■ HRPs and CoE staff partner
various clouds throughout attended by the SVP HR, the ■■ Permanent moves into a vacant to facilitate all executive talent
the organization. Moves are head of Executive Talent, and role and HIPO programs in addition
the Executive Investments to regular career conversations
intended to best use existing ■■ Creation of a new role
with leaders.
Committee (EIC)a
strengths by creating the right
skill balance in different parts
of the business; they are not Key Questions to Vet Opportunities Considerations to Manage Deployment Decisions
intended to compensate for
1. Are missing skills critical to the 1. Should the move be temporary or long-term?
individual underperformance. function’s strategic priorities 2. Should we create a new role or restaff an existing role?
(i.e., are lower levels of capability
3. Should we add to the function or swap talent with another function?
acceptable)?
4. What could hinder the success of the transition (e.g., personality
2. Is the imbalance a result of
misalignment, career expectations)?
underperformance?
3. Will the move create disruption
or imbalance in another function?
Quarterly talent reviews reveal Given strategic priorities, a new role Business Unit B’s HRP nominates
insufficient “Collaborate” capability is needed, rather than a temporary Sam for the role, given his skill mix
in Business Unit A. rotation. and aspirations.
D
5
C 3 A
1
L E
Capability Mix, BU A Sam, VP, BU B

a
The EIC is a subset of Cisco’s Operating Committee.

Cisco shares the updated
model with all levels of the
ADAPT THE LEADERSHIP MODEL TO ENSURE
organization to provide a clear
model of success for future
RELEVANCE ACROSS LEVELS
leaders and ensure a robust
leadership capability clouds Cisco’s Multi-Level Leadership Model Adaptation and Rollout
over time.
With support from HR, each Customization Framework

function defines customized
competencies for its employees Forty percent
based on the unique needs of of behaviors are
the business. Considerations 40% customized by each
vary with the needs of each Function– function to ensure
VP and
function and may include: Current Leaders Specific relevance to different
Above
functions and business
■■ Unique business context contexts.
(e.g., high growth),
■■ Technical skill requirements,
Directors Corporate Function
■■ Competitive environment, 60% Competencies
Services
Short–Term Universal Development Competencies
■■ Legal/regulatory Future Leaders (Engineering) Sales
considerations, or Competencies Competencies
Managers Global/Regional
■■ Culture. Competencies
The model’s transparency helps

individuals at all levels find Individual
Individual Contributorsa
coaching and mentoring, which Contributors
supports better career path and and Long–Term
development decisions, not just Future Leaders
deployment.
When individual contributors Functions Own Customized Competencies

are assessed against the Engineering HRP
model, they are not assessed
Engineering Function
on leadership specifically, Corporate HR Representatives
but rather on their ability to Representative
perform within the culture
and expectations of the
organization. a
Individual contributors include employees at multiple seniority levels within Cisco.

LEADERSHIP CAPABILITY CLOUDS: IMPLEMENTATION CHECKLIST
1. Define and Cascade the Organization’s Leadership Model
Facilitate leader identification of key challenges and opportunities (given the organization’s strategy) using interviews and focus groups.
Tip: Use technology to ensure global representation and to increase the efficiency of the interview process.
Tip: Keep the process leader driven (rather than an HR initiative) by engaging leaders as process owners, not just sources of information.
Define or update the competencies and behaviors in the organization’s leadership model as needed to reflect organizational needs and priorities.
Tip: Avoid marginal changes and/or adding nuance to the model. The interview process may be used to validate the model’s ongoing relevance, not just
to identify needed change.
Share the model with all employee levels, not just leaders.
Partner with each function to develop customized function- or geography-specific competencies.
Tip: Give current leaders a primary role in communicating and embedding the new model at all levels.
2. Conduct Leadership Assessments to Build Transparency into Network Capability and Business Needs
esign an assessment to provide leaders with insight on their skill profile relative to the model, as well as their skill mix relative to their peers’ capabilities and
D
the business needs.
Select HRBPs and CoE specialists to conduct an assessment and follow-up development conversation with each leader.
Tip: Choose a select group of HRBPs or CoE specialists based on their mix of technical skill and business knowledge, rather than having each HRBP conduct the
assessment for their leader.
onduct the assessments outside of the performance review process.
C
Compile team- or business unit–level assessment results to share with leaders during their individual development conversations.
Have HRBPs prepare for individual leader development conversations by analyzing individual results in the context of aggregated results and business needs.
Tip: Always provide business unit capability results in aggregate, rather than sharing peers’ individual assessment results.
Ensure HRBPs conduct development conversations in a way that helps leaders understand their fit within business needs and capability.
Discuss individual skills relative to business unit capability and strategic needs, not relative to the model alone.
Reinforce that the conversation is not part of the performance review process.
Identify opportunities to use the leader’s strengths in his or her current role or potential future roles.
Identify opportunities for continued development and support, given the strengths of peers in the organization.
3. Manage and Deploy Leadership Talent Based on Network Capability and Business Needs
ork with HRBPs and senior leaders to define the necessary mix of skills in each business unit based on business unit strategy, maturity, and environment.
W
Provide HRBPs with training and tools to support a more group-oriented view of business unit capability.
Ensure HRBPs who are not involved in the assessment process are armed with detailed knowledge of the capability mix within their business units.
Reorient talent review discussions to consider aggregate leadership capability, not just individual profiles.
Review collective business unit capability relative to business needs, not just individual talent profiles.
Ask HRBPs to nominate leaders from other parts of the business to fill gaps or provide support in business units that are misaligned with current needs.
Tip: Consider a variety of options for rebalancing capability within a business unit (e.g., new role, permanent move, temporary rotation) depending on the
specific situation.

TWO IMPERATIVES TO INCREASE TRANSPARENCY FOR LEADERS
1 2
Increase Leaders’ Knowledge Help Leaders Increase Teams’
of Relative Strengths Knowledge of Relative Strengths
Optimize capabilities across Equip teams to self-identify enterprise

leadership teams, rather than trying contribution opportunities, rather
to perfect individual capability. than just cascading them down.
Leadership Capability Clouds Portfolio Reviews

PORTFOLIO REVIEWS
OVERVIEW
Network performance opportunities are often hidden from leaders’ fields of vision, and most leader attempts to support
team-identified opportunities do not strike the right balance between direction and self-discovery. At IDEO, the annual
business review uses collective goal setting to enable leaders to empower high-impact, team-sourced contributions.
SOLUTION HIGHLIGHTS
■■ Create a Lens for Assessing the Group Through a Leader-Defined Review Framework
Group leaders review the long-range strategic plan before selecting broad themes that will act as a framework for
employees to independently review the group’s direction.
■■ Build Team Knowledge of Group Needs Through an Employee-Led Portfolio Review
All employees in a group are divided into cross-project teams and armed with the guiding framework before assessing
the unit’s past year and identifying areas to share and receive contributions from other groups.
■■ Improve Organizational Awareness of Contribution Opportunities Through Public Location Narratives
Leaders create publicly shown narratives based on the group’s portfolio review findings to help employees throughout
the organization identify opportunities to provide high-impact support during the coming year.
COMPANY SNAPSHOT
IDEO
Industry: Consulting IDEO was founded in 1991 to bring a human-centered approach to helping
Founded: Palo Alto, CA organizations in the public and private sectors innovate, grow, and bring
new ideas to market. Today, IDEO is an award-winning global design and
innovation consultancy that partners with organizations in 10 offices in
six countries worldwide.

At many organizations, leaders
struggle to provide their teams
LEADERS STRUGGLE TO GUIDE TEAM NETWORK
with the right level of support
to enable team network
PERFORMANCE
performance.
Network Performance Opportunities Are Often Hidden from Leaders
One cause of this challenge
is that leaders are unable to
see many of the potential
Hidden
opportunities teams have to Opportunities
support and receive support
from others. As a result, leader
approaches to supporting
team network performance
OBVIOUS
OPPORTUNITIES
often strike the wrong balance
between direction and self-
discovery.
Leader Support of Team Identification of Network Performance Opportunities Is Often Unbalanced
Under-Involved
When leaders
take a hands-off
approach, teams
tend to waste time
Overly Directive on low-impact
When leaders are contributions.
overly directive, they
tend to overlook
opportunities for
contributions they
cannot see.

IDEO’s annual business review
enables leaders to empower
EMPOWER TEAMS TO IDENTIFY CONTRIBUTION
team-identified contributions
through collective goal
OPPORTUNITIES THROUGH THE BUSINESS REVIEW
setting. The graphic on this
page provides a high-level IDEO’s Annual Business Review and Key Steps for Leaders
overview of IDEO’s annual
business review, including who
is involved at each step and
what primary role business unit
leader plays.
REVIEW PORTFOLIO LOCATION LOCATION BUSINESS AND

FRAMEWORK REVIEW REVIEW NARRATIVE TALENT PLANNING
Location Leadership
Location All Employees at All Location Location
and Executive
Leadership Locations and Levels Leadership Leadership
Review Board
IDEO Terms Defined
■■ Framework: A critical
Sets parameters for Reviews the past Sets forward-looking Shares the location’s Builds tactical financial
imperative specific to
employees to assess year’s work within the goals for the business story, needs, and goals and talent plans for the
a location that sets the
the location framework to understand group that align with with all of IDEO coming year
direction of the portfolio patterns and hypothesize the broader organization
review (e.g., skills, growth, future themes for the
reorganization) location
1 3
■■ Location: IDEO is divided
Create a lens for Improve
into business units/groups
assessing the organizational
by geographic location. 2 awareness of
group through
■■ Location Leadership: The a leader-defined Build team contribution
opportunities
group of leaders responsible review framework. knowledge
through public-
for the running of a of group
facing location
geographic location needs through
narratives.
employee-led
■■ Location Narrative: A video portfolio review.
about a location that is shared
with the entire organization
■■ Location Review: An Source: IDEO; CEB analysis.
executive calibration of a
location by senior leadership
■■ Portfolio Review: The annual
CASE IN PRACTICE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
strategic review for a location

Rather than prescribing specific
strategic objectives, leaders
LEADER-DEFINED STRATEGIC THEMES
select broad themes to guide
informed decisions about the
PROVIDE A FRAMEWORK TO ASSESS EACH LOCATION
location.
Leaders take a strategic view

by looking at the previous
year’s portfolio review and Build a Framework That Will Empower
Consolidate Long-Range Organizational
additional insights from groups Employees to Self-Assess the Location
1 Goals to Identify Emerging Themes That 2
responsible for the health of the and Identify Opportunities to Work with
Could Act as a Framework
organization, such as Finance Others
and Operations.
Long-Term
“We are trying to double our
Strategic Plan
presence in Asia by 2020.
1. Expand into Asia. 2013 Singapore
Portfolio Review We all need to ensure we
2. have the right skills and
Framework: “Reach”
capabilities in our location.
3. (diversifying market share)
This year’s theme is ‘Muscles.’”
2014 Support Function Goals

■■ HR—Build hiring strategy to attract candidates
with the following profiles…
Empowering Components of a Framework
■■ IT—Increase real-time information sharing
between teams…
Broadly Easily Assessed
Grounded In
Relatable by Individuals
Long-Term
Across Group Not Closely
Objectives
Imperative for HR Workstreams Related to
“We seem to be doing well against our the Topic
Identify talent trends from goal of diversifying, but I’m not sure we
the past year that will be have the right skills needed to stay on our
helpful for the leader to
growth trajectory…”
consider.
rovide insight on central
P Location leadership, Singapore
talent initiatives that will
Source: IDEO; CEB analysis.
influence the framework.
elp the leader simplify
H
the framework.

Armed with the framework, all
employees in a location assess
EMPLOYEE-LED PORTFOLIO REVIEWS BUILD
the location’s past year and
identify areas to support and
TEAM KNOWLEDGE OF LOCATION NEEDS
receive support from other
groups. What is the future direction of our location?
The employees from each

Convene Cross-Project Teams to Assess
location are separated into 1 2 Assemble Small Teams to Discuss and
small groups that mix teams Unrealized Needs and Opportunities in Consolidate Findings into a Single Set
and tenure to review projects Past Year’s Projects of Learnings
from the past year within the
framework’s context. After
the small groups review
their projects, the location 2014 Singapore Portfolio Review
TEAM Illustrative
employees reunite to discuss
their findings and collectively Location Summary
draft a review of the past year Project Consultant, Analyst, Administrative 1. Mission Statement
as well as hypotheses for the Manager, Team B Team C Assistant 2. Objective
Team A
coming year. Review of 2014
1. Project Reviews
Hypotheses for 2015
PROJECT selection of diverse projects from the
A 1. Talent Needs
REVIEW past year 2. Portfolio Needs
INPUTS Additional insights from location leaders Surfaced Opportunities to Partner
and support functions (as needed) with Others
1. Skills
SAMPLE ■■ Did we have the skills needed to complete

QUESTIONS our projects and goals last year?
TO ASSESS ■■ Could we have been more successful
“MUSCLES” if we had other skills to draw from?
Imperative for HR ■■ Are we missing opportunities to apply our
skills to other types of projects that are not
uide small groups through
G represented here?
talent elements of reviews. ■■ Based on our review, if another IDEO location
rovide insight for the talent
P could teach us a new skill, what do we think
segment of the strategic plan. would be most valuable to our work?
se the portfolio review to
U
identify opportunities for
career development in the
coming year.

Leaders create location
narratives based on the portfolio
PUBLIC LOCATION NARRATIVES DRIVE
review that specify where other
units could provide high-impact
AWARENESS OF CONTRIBUTION OPPORTUNITIES
support in the coming year.
Singapore Location Narrative Key Components
Leaders from each location Illustrative
articulate their portfolio review’s
findings via a three–minute
video called a location narrative,
which is posted on a dedicated
portal for the locations.
Singapore Location
ASPIRATION OFFER PEOPLE REQUESTS
The location narratives are Narrative
Mission Objectives Existing and Needs from
designed to enable employees COMMENTS:
Statement for Coming Year Needed Skills the Network

throughout the organization to
COMMENTS:
@Elo32: Love the muppets! Really captured 342 Likes Like
@Elo32: Love the muppets! Really captured
the spirit of the office and the projects you’ve
the spirit of the office and the projects you’ve
been working so hard on this year.
been working so hard on this year.
identify patterns and connect

EXAMPLE “We are going to “We’re doing this in “To achieve our “We’re looking for
resources between teams,
transform Singapore three primary ways.” growth goals, we help from other
increasing organizational
into a creatively need mentors and locations with tools
awareness of opportunities
confident country.” capability enhancers or best practices
to share skills and resources. that can upskill new in these types of
The graphic on this page shows talent quickly.” projects…”
an example of the type of
information communicated
in location narratives. IMPACT Visualizes how different Builds awareness of Enables employees to Empowers employees
groups are related how needs are see patterns in emerging to generate space for
prioritized skill needs connecting with other
units
OUTCOME
■■ Sets context for business goals of the location for the coming year
■■ Creates clearer opportunities for alignment between individual career objectives and the
Imperative for HR locations’ purposes and strategic goals
■■ All employees in the organization have the information and common language needed
rovide context about
P
to identify high-impact contribution opportunities year-round.
location narratives during
onboarding.
Incorporate narrative
language into trainings.
Incorporate location narrative
language in leader and
employee objective setting.

IDEO’s portfolio reviews
and location narratives give
GOAL VISIBILITY CREATES COMMON LANGUAGE
teams the knowledge and
visibility to source meaningful
FOR HIGH-IMPACT CONTRIBUTIONS
opportunities to contribute to
each other throughout the year.
Three ways an organization could measure the results of this approach:
1 2 3
Evidence of individuals An increase in internal Progress within groups
shifting their personal transfers for business- toward annual goals
objectives to align with critical positions around and targets
the strategic goals and the organization
purpose in the location
narrative
“We find that the portfolio reviews give people a common language to use when
articulating what their location is about to other teams. The location narratives, on
the other hand, really drive home the shared history of IDEO. They are a shorthand
for employees around the globe to increase their awareness of what each location
is doing and fill in the blanks for how their work can fit in that space. Both pieces
are critical components of how we tell our greater story to the rest of the world.”
Duane Bray
Partner and Head of Global Talent
IDEO

PORTFOLIO REVIEWS: IMPLEMENTATION CHECKLIST
1. Help Leaders Define a Theme
Before the business unit leader begins to review his or her long-range strategic plan, meet with the HRBPs to discuss the long-range HR strategy.
Provide the HRBPs with information about the organization’s long-term talent vision, key challenges faced last year, and goals for the coming year.
T
ip: For large or decentralized organizations, consider treating each business unit as a single, autonomous organization. Plan to divide the business units
into groups that will each hold their own portfolio review.
acilitate a meeting with all HRBPs and their peers in other support functions to identify early themes across groups that can be presented to the leader
F
for determining a framework theme.
equire HRBPs to meet with their business unit leaders to provide insight on the business unit’s talent initiatives from the past year, which will help inform
R
the theme.
Include key data points that demonstrate the unit’s current talent situation.
Walk through major changes that have taken place in the past year.
Highlight early-identified goals for the coming year.
2. Support Employees During the Portfolio Review Process
Require all HRBPs and their direct reports to be available to answer questions during their business unit’s portfolio review.
Consider assigning HR generalists to specific small groups to ensure that all groups know whom to reach out to for questions.
Check with the business unit leader to see whether lower-level HR staff aligned with a business unit will be assigned to participate in a small group.
Have the business unit HRBP sit in during small group presentations and ask questions about findings.
Tip: Consider requiring all HRBPs to meet again after the portfolio review to share any talent findings or hypotheses from their business unit.
3. Embed Organizational Awareness of Network Performance Opportunities
Meet with the executive team after all business units have completed their portfolio reviews to complete the location and organizational reviews.
Draft an organizational talent plan for the coming year with the executive team.
Share the talent plan with business unit leaders and their respective HRBPs.
Support HRBPs as they build business unit talent plans for the coming year.
Build language from the location narratives into talent programs to embed awareness of collaboration opportunities throughout the employee life cycle.
Incorporate location narrative language and themes into development programs.
Embed location narrative language and objectives into performance management materials for managers and employees.
Tip: Consider sharing location narratives at onboarding events to reiterate a culture of network performance to new hires.

PORTFOLIO REVIEWS: IMPLEMENTATION Q&A
■■ What is the greatest barrier we should anticipate when implementing this ■■ How can we ensure that leaders identify the most critical and relevant
practice? theme for their unit?
Some leaders will be hesitant to implement a practice like this because The seniormost individuals from each business unit should work with the
it adds another step to the annual business review process and involves strategy team as well as their business partners in support functions to
employees at lower levels. To ensure this practice is implemented effectively, determine a theme for the business unit. If leaders struggle to identify a
organizations should communicate to leaders that the practice is designed theme that is relevant to all employees within the unit, consider requiring
to increase high-impact network performance. Lower-level employees will leaders to submit their theme to the executive team for review before the
not be setting the strategic direction of the business unit, but rather helping portfolio reviews begin.
to identify opportunities for network performance that can improve business
unit performance.
■■ How do we ensure employees can assess the business unit for the year
effectively?
■■ Is this practice worthwhile if we do not divide our organization into Employees should not be responsible for assessing the entire business unit;
business units by location? they should only look for evidence of how the business unit is performing
Organizations can lead portfolio reviews for a variety of business groups within a specific lens determined by the business unit leader. Business
(e.g., business units, product lines, geographic regions, functions). To unit leaders can further narrow the scope of the portfolio review for their
implement this practice successfully, all business groups should be structured business unit by preselecting a limited number of projects for small groups
similarly and be of relatively equal importance. Some groups can be larger to review. Organizations could also have multiple small groups assess the
than others; however, organizations should not lead a portfolio review for a same projects.
business unit while leading a portfolio review for multiple product lines or
support functions within that business unit.
■■ How do we ensure that employees follow up on identified opportunities for
network performance?
■■ How do we implement this practice if we are a large or decentralized For organizations whose employees are new to collaborating with other
organization? teams, consider requiring leaders to set aside time to review the location
For highly decentralized organizations, consider enabling each business unit narratives with their direct reports and identify as a team a few high-impact
to host its own internal series of portfolio reviews and location narratives collaboration opportunities that the team can take advantage of during
within the business unit. A more decentralized approach will ensure the the year. This type of process can be easily duplicated at higher and lower
information is relevant to the employees participating in the process. levels in the organization and will build employee confidence in identifying
collaboration opportunities.

IDEO’S ANNUAL BUSINESS REVIEW CYCLE
REVIEW PORTFOLIO LOCATION LOCATION BUSINESS AND

FRAMEWORK REVIEW REVIEW NARRATIVE TALENT PLANNING
Location Leadership
Location All Employees at All Location Location
and Executive
Leadership Locations and Levels Leadership Leadership
Review Board
PURPOSE
Sets parameters for Reviews the past Sets forward-looking Shares the location’s Builds tactical
employees to assess year’s work within goals for the location story, needs, and financial and talent
the location the framework to that aligns with the goals with all of IDEO plans for the coming
understand patterns rest of the year
and hypothesize organization
future themes for the
location
CONTRIBUTING FACTORS
Last year’s portfolio Projects from the past The portfolio review The portfolio review The portfolio review
review and the year and additional and an assessment and outcome of the and outcome of the
organizations long- insight from support of past financial location review location review
range strategic plan functions performance

Who are the key members of
your leader network?
LEADER GUIDE: UNDERSTANDING YOUR FIT IN THE
Consider how your peers across LEADER NETWORK
business units and support
functions contribute to your
Name(s) What capabilities do What capabilities do I What additional
performance, as well as the value
they have that I or my or my team have that capabilities do I have
you might be able to provide to
team could benefit could contribute to that could support this
them.
from? their success? business unit’s strategic
Try filling out as much of this objectives?
page as possible to test your
knowledge of your networks Your Business Unit:
capabilities. Discuss the results _____________
with your HRBP to fill gaps and
identify opportunities to work
differently with your peers.
Business Unit 1:
_____________
Business Unit 2:
_____________
Business Unit 3:
____________
Support Function 1:
____________
Support Function 2:
____________
Other: ____________

INCREASE TRANSPARENCY OF RELATIVE STRENGTHS TO ADDRESS
INSUFFICIENT INFORMATION
■■ Few leaders have the information they need to be successful ■■ Update performance conversation guidelines to incorporate
as Enterprise Leaders; less than 40% of leaders understand discussion of key relationships, not just behaviors and
how their work and the work of their teams connect to people competencies.
and priorities outside their business units. ■■ Update leadership assessment reports to reveal strengths and
■■ To support Enterprise Leadership, increase the transparency of weaknesses relative to other leaders. Facilitate discussion of
two key types of information: relative strengths within leadership teams.
–– Peer Capabilities—How individual leaders’ skills fit within ■■ Encourage leaders to discuss their unique skill mix with their
peers’ capabilities across the function and the organization teams.
–– Business Needs—How individual leaders’ capabilities
align with the organization’s strategic objectives, stage of
maturity, and environmental context

A leadership environment where leaders need transparency into the relative strengths of teams
and peers to reduce insufficient information has several implications for the head of HR. In
particular, heads of HR should consider the following:
How can I arm my HRBPs with information about other business units’ strengths and
1 weaknesses that they can share with their leaders?
How can I adjust our leader deployment strategies to pair leaders with complementary
2 skills sets?
How can my staff communicate the skill mix throughout the organization to enable
3 leaders to identify their capability fit?
Do our leader mentorship and networking programs match leaders from business units
4 with complementary strategic needs?
How well equipped are my HRBPs to support our leaders in increasing their teams’
5 awareness of other groups’ needs?

Chapter III: Redesign
Evaluations to Reduce
Rewards Risk
72



Chapter III: Redesign Evaluations to Reduce Rewards Risk 73

Rewarding Enterprise Leadership
is a challenge for many
LEADERS DO NOT BELIEVE THEY ARE REWARDED
organizations. We found that
although nearly all organizations
FOR ENTERPRISE LEADERSHIP
have incorporated Enterprise
Leadership criteria into leader Nearly All Organizations Evaluate Leaders Few Leaders Believe Contributions to Others
evaluations, only one-third of Against Enterprise Leadership Criteria Are Financially Rewarded
leaders believe they are rewarded Percentage of Leaders Who Report That They Percentage of Leaders Who Agree That Their
for their contribution to others’ Have at Least One Network Performance Objective Contributions to Others’ Work Are Financially
work. Rewarded
The leader perception that

contributions are not rewarded
is not misplaced, as fewer than
one in five Enterprise Leaders
35%
received top ratings during their Agree
last performance review.
97%
Agree
n = 2,101. n = 2,101.
Source: CEB 2014 Enterprise Contribution Workforce Survey. Source: CEB 2014 Enterprise Contribution Workforce Survey.
Leader Perceptions Align with Organizational Reality
Only 17% of Enterprise Leaders received top ratings

in their last performance evaluation.
n = 908.

For many organizations, current
evaluations of leaders are not
REWARD LEADERS FOR ENTERPRISE LEADERSHIP
capturing Enterprise Leadership
because the objectives used to
OUTCOMES, NOT JUST BEHAVIORS
evaluate Enterprise Leadership
typically look at individual Focus on Enterprise Leadership Behaviors Four Principles of Rewarding Enterprise
leader behaviors. Creates Leader Perception of Rewards Risk Leadership as Outcomes
To reduce the rewards risk,
organizations should instead
reward Enterprise Leadership
eaders perceive behavioral criteria as highly
L Quantify Enterprise Leadership to make
as outcomes. To do so, leader
subjective. outcomes feel tangible.
evaluations should be:
■ Quantified,
so outcomes feel
tangible;
■ Personalized
to the leader’s Leaders struggle to connect their personal ersonalize objectives to connect leaders’
P
individual goals; responsibilities with general objectives. specific contributions to business goals.
■ Clarified,
so the connection
between contributions and pay
is obvious; and
■ Shared
across partnering
Leaders do not understand how Enterprise larify the connection between leader
C
leaders and teams.
Leadership translates into compensation. contributions and pay.
Organizations that effectively
measure Enterprise Leadership
outcomes increase the likelihood
of their leaders being Enterprise
Leaders by 42%. Leaders do not believe that one-sided criteria ssess leaders’ ability to work on shared
A
accurately capture Enterprise Leadership. outcomes with peers and teams.
Leaders who believe they are rewarded

for Enterprise Leadership outcomes are
42% more likely to be Enterprise Leaders.
n = 2,301.
Source: CEB 2014 Enterprise Contribution Workforce Study.

Organizations should follow
four principles to effectively
FOUR PRINCIPLES OF EVALUATING ENTERPRISE
evaluate and reward Enterprise
Leadership outcomes. Leader
LEADERSHIP OUTCOMES
evaluations should be:
Enterprise Leadership Evaluations Must Be…
■ Quantified,

■ Personalized,

■ Clarified,
and
■ Shared.

QUANTIFIED PERSONALIZED CLARIFIED SHARED
Quantify Enterprise Personalize objectives Clarify the connection Assess leaders’ ability to
Leadership to make to connect contributions between leader work on shared outcomes
outcomes tangible. with business goals. contributions and pay. with peers and teams.
Network Horizontal Span of Cross-Divisional

Performance Points Goal Cascade Influence Mapping Partnership Review
Interactive Enterprise
Leadership Evaluation
(Appendix)

As part of the self-review
section of the annual
QUANTIFY PEER CONTRIBUTIONS TO INDIVIDUAL
performance review, each
partner at Herbert Smith
SUCCESS
Freehills (HSF) recognizes the
contributions other partners HSF’s “Contribution to the Success of Others” Platform
have made to their success Illustrative
through a points system.
Partners reflect on 1
contributions from other peers Employee Name: John D. Available Points: 10
in the partner population Partner Name Points Briefly Describe How This Individual Has Briefly Describe the Impact of This Individuals
(approximately 180 partners Contributed to Your Success Contribution
in Australia), and distribute 4 Mary introduced me to client XYZ after I sold the client a 36-month contract with option
Mary
their 10 points through a web determining that they would be a good to extend.
portal to the partners who candidate for our environmental litigation
2 services.
have contributed most to
their success. Beyond simply 1 Mike provided encouragement during a I was able to maintain a positive relationship
Please Select
distributing points, however, challenging case. with a difficult client.
Mike G
partners provide examples of 1 Alyssa frequently puts me into contact with Alyssa connected me with our paralegal, whose
Adam N rising talent looking for new opportunities experience in oil directly contributed to the
how others supported them
Jessica K success of a case.
over the past year.
Bill W
3
2 Chris has been a valuable resource by sharing I have been able to successfully assume
Chris
his expertise in managing clients in China. ownership of 4 new APAC clients into my
portfolio.
1 Situational Points Allocation 2 Limited Recognition 3 Individual Impact

Partners are allotted points to Partners only recognize those they Partners are required to provide
distribute through a web portal. New feel have contributed the most to a sentence or two about how each
partners and partners working on their personal work, so comments are individual has contributed to their
Diverse Forms of Collaboration high-risk projects are given 20 points limited to those individuals. success and the impact. Partners
HSF recognizes that instead of the standard 10 because are given broad guidelines about
collaboration can take several they should be receiving more help which types of contributions they can
forms. They were surprised to from peers. recognize.
see that partners attributed Source: Herbert Smith Freehills; CEB analysis.
points to a wide variety of
contributions from peers, from
financial and talent to emotional
and psychological.

Leaders at Delhaize customize
a peer’s MBO when they take
PERSONALIZE MBOs TO CLEARLY TIE LEADER
it on as their own, making
it relevant to their roles and
CONTRIBUTIONS TO REWARDS
tying it to outcomes they can
influence. Delhaize’s Leader MBO Customization Process
Illustrative
When leaders jointly own an
MBO, they identify the parts of 1 Leader identifies value- 2 Peer considers how to maintain 3 Peer includes customized MBO
the original MBO that they can adding collaborations. line of sight between his or her that remains relevant to original
influence and customize their actions and how he or she will be MBO and peer’s own work.
equivalent MBO to focus on rewarded for this MBO.
those parts.
Business Leader’s MBOs, Considerations for Customization IT Leader’s Original MBOs
Delhaize requires its leaders
Operating Company A When Jointly Owning MBOs
to personalize, rather than just ■■ Ensure applications and
IT Leader’s New MBOs
duplicate, their peer’s original ■■ Identify cost savings in 1. Evaluate how better execution infrastructure are mobile-
■■ Ensure applications and
MBO to ensure leaders retain departmental budget. of this activity will improve your compatible
line of sight between their function’s performance. infrastructure are mobile-
■■ Create succession plan ■■ Implement global IT service
actions and how they are compatible.
for critical positions. 2. Break down the MBO into the desk
rewarded. key activities or tasks required ■■ Implement global IT service
■■ Accelerate sales and build ■■ Launch new antivirus
to achieve it. desk.
Managers, the owners of market share. software
■■ Roll out distance-shopping
the joint MBOs, and target 3. Identify the activities that rely
■■ Increase CSR activities ■■ Implement training solutions
validation teams all serve as on your input. platform for Operating
in local community. for allowing employees to
checks to ensure each leader Company A.
4. If needed, prioritize the use technology productively
■■ Identify potential new
is held accountable for a fair activities according to those ■■ Implement training solutions
products and services.
balance of individual and that are most critical to for allowing employees to
shared MBOs. achieving the MBO. use technology productively.
5. Determine whether KPIs ■■ Roll out corporate
I need associated with the objective knowledge-sharing platform.
expert support are relevant to your role, and
for this…
adjust them if not.
Business Leader, IT Leader

Operating Company A
IT Leader
Source: Delhaize Group SA; CEB analysis.

BD defines a set of activities
that constitute executive
CONNECT INCENTIVES TO SPAN OF INFLUENCE
influence and then determines
how much of each executive’s Span of Influence and Control for Executive Categories
incentives will be funded by
different sub-segments of Executive Category OPU Defined by OPUs Defined by Span of Influence
the organization known as Span of Control
organizational performance 1. C
ountry Business Country Total Country: Help other businesses acclimate to country culture, use key customer
units (OPUs). Unit Executive Business Unit relationships, and achieve operating efficiencies.
Regional Business Unit: Identify best practices in manufacturing and sourcing.
BD uses the OPUs to measure 2. R
egional Business Regional Total Region: Help BD take a more integrated approach to the region.
organizational performance at Unit Executive Business Unit Worldwide Business Unit: Share best practices with other regional business units.
various levels in the company.
3. Worldwide Worldwide BD Corporate: Integrate company’s global operations.
Business Unit Business Unit
Executive
4. C
ountry Shared Total Country Total Region: Drive efficient allocation of shared resources at the regional and country level.
Services Executive
5. R
egional Shared Total Region None: Limited ability to influence operations beyond the region
Services Executive
6. Corporate BD Corporate None: Entire company in span of control
Executive
Source: Becton Dickinson; CEB analysis.
Determination of Executive Incentive Pool Funding Through OPUs
Up to 50% of incentives are based BD’s six types of OPUs

Decision rules for weighting on OPUs influenced by the leader.
OPUs for incentives:
■■ An OPU counts toward a Percentage of Bonus Funded by Organizational Performance Unit
minimum of 25% of executive BD’s Six Executive Categories Country Total Country Regional Total Region Worldwide BD Corporate
incentives or is not counted Business Unit Business Unit Business Unit
at all. 1. Country Business Unit Executive 50% 25% 25%
■■ OPUs that represent an 2. Regional Business Unit Executive 50% 25% 25%
executive’s span of influence 3. Worldwide Business Unit Executive 75% 25%
will each drive 25% of the 4. Country Shared Services Executive 75% 25%
executive’s incentives.
5. Regional Shared Services Executive 100%
■■ The OPUs that represent an
6. Corporate Executive 100%
executive’s span of control
will drive the majority of the Source: Becton Dickinson; CEB analysis.
executive’s incentives (50%,

75%, or 100% of the total).

CROSS-DIVISIONAL PARTNERSHIP REVIEW
OVERVIEW
Teachers’ realized that collaboration between its divisions was inconsistent and that leaders perceived collaboration
differently from how employees actually experienced it. Teachers’ provided leaders with a mechanism to better
understand collaboration across divisions and to hold them accountable for improving their relationships.
SOLUTION HIGHLIGHTS
■■ Surface Less-Visible Aspects of Network Performance Through Cross-Divisional Surveys

Teachers’ conducts an annual Partnership Survey to assess the health of divisional partnerships against its Partnership
Principles on day-to-day interactions.
■■ Hold Leaders Mutually Accountable for Cross-Divisional Relationships
Divisional leaders are accountable for ensuring their teams are taking action to improve and/or maintain productive
partnerships across divisions based on Partnership Survey results.
■■ Enhance Partnerships Through Cross-Divisional Action Planning, Including Leader-Led Workshops
Leaders create action plans, such as workshops, to eliminate barriers between divisions.
COMPANY SNAPSHOT
Ontario Teachers’ Pension Plan

Industry: Financial Services Ontario Teachers’ Pension Plan, commonly known as Teachers’, is
2013 Total Assets: US$140.8 Billion Canada’s largest single-profession pension plan with $140.8 billion
in net assets. Teachers’ pays pensions and invests plan assets
2013 Employees: 1,000
on behalf of 307,000 working and retired teachers. Since its
Key Region of Operation: Canada establishment as an independent organization in 1990, Teachers’
has built an international reputation for innovation and leadership
in investment management and member services.

Teachers’ realized that
collaboration between divisions
LIMITED UNDERSTANDING OF COLLABORATION
was inconsistent and that
leaders perceived collaboration
HINDERS NETWORK PERFORMANCE
differently from how employees
actually experienced it. Teachers’ Experienced Inconsistent Collaboration Within Its Organization
Teachers’ had external
consultants interview Functional Partner A
employees to understand
what barriers were preventing
effective collaboration, and
it found that senior leaders Functional Partner B
perceived collaboration
differently than how employees Investments Group
reported experiencing it.
Specifically, it found that Functional Partner C
leaders lacked understanding
of the collective team’s day-to-
day work, particularly how they Functional Partner D
interact across divisions.
Source: Ontario Teachers’ Pension Plan; CEB analysis.
Teachers’ Unearthed Gap Between Leader Perceptions of Collaboration and Reality
“My team works well “We never get what we

with Investments…” need from Investments
“There are significant on time…”
=/
gaps between leader
perceptions of
collaboration and what is actually
occurring in the organization. In
our interviews with leaders, we
found that perceptions of VP, External Consultant Mid-Level Manager, External Consultant
partnership at the senior level Functional Partner Functional Partner
were actually quite different than Source: Ontario Teachers’ Pension Plan; CEB analysis.
those at the mid-level.”
Dan Houle
PRACTICE
VP of Investment Operations CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW
Ontario Teachers’ Pension Plan

Teachers’ provides leaders
with a mechanism to better
HOLD LEADERS JOINTLY ACCOUNTABLE FOR
understand collaboration
across divisions and holds
IMPROVING CROSS-DIVISIONAL RELATIONSHIPS
them mutually accountable
for improving and maintaining Teachers’ Approach Consists of Three Components
relationships over time.
Leaders from clients and

Component 1 Component 2
functional partners are
Surface less-visible aspects of network Hold leaders mutually accountable
accountable for ensuring
performance through cross-divisional surveys. for cross-divisional relationships.
cross-divisional improvements
Illustrative Illustrative
in feedback and performance.
Division Receiving the
Partnership Survey
Functional Partner A Functional Partner B
Rating
Department Providing
Favorable Neutral Unfavorable Favorable Neutral Unfavorable
the Rating
Surveyer: Investments Fixed Income and

Alternative Investments
61% 19% 20% 60% 18% 22%
Surveyee: Functional Partner Investments

Private Capital
Infrastructure
82%
25%
10%
30%
8%
45%
33%
21%
38%
60%
29%
19%
Public Equities 57% 20% 23% 59% 35% 6%
Assess how your functional partner performs

Divisional Corporate Scorecard
Tactical Asset Allocation
71% 19% 10% 67% 29% 4%
and Natural Resources
against the eight Partnership Principles:

1. R
esults from Partnership Survey roll up
1. Seamless Support
to a company scorecard.
2. Business-Led Decisions
■■ Each division puts an action plan in place
3. Client-Aligned
to address their survey results.
Component 3
Enhance partnerships through cross-divisional action planning, including leader-led workshops.
Employees from Employees from

Investments Functional Partner
PRACTICE
OVERVIEW

7
Partnership Experience Conference
Cross-divisional assessments 8 Partnership
IDENTIFYModelLESS-VISIBLE
Principles
ASPECTS OF NETWORK
reveal feedback on interactions
that are not typically visible to
leaders.
PERFORMANCE THROUGH CROSS-DIVISION SURVEYS
The Partnership Experience Conference was held on March 29 and 30,
The organization conducts2012
a with participation from more than 400 team members in Finance,
Teachers’ Eight Partnership Principlesa
IT, AM&R, ePMO, and Investments.
Partnership Survey annually
to assess the health of its
partnerships against eight
1. Seamless support
WORKING BETTER
Partnership Principles in Partnership Survey
day-to-day interactions. The 2. Business-led decisions Sample Questions Asked
Partnership Principles, shown
TOGETHER
on the top left of this page, 3. Client-aligned ■■ Seamless Support
outline service expectations for “Employees show an appropriate sense of
clients and functional partners.
4. No wrong door responsiveness in their interactions with me.”
Teams take the survey based on Business-Led Decisions
5. Insight and transparency
■■
the scale and frequency of their “Employees appropriately involve me when a

interactions. 6. “Right touch” tools decision must be made involving my area of
responsibility.”
7. Proactive communication
8. Mutual accountability
Source: Ontario Teachers’ Pension Plan.
a
See the Implementation Guide for more information on Teachers’
eight Partnership Principles.
Functional Partner
Participants Selected by Senior Leaders Selected

Participants
Decision criteria for selecting teams to participate:

■■ What is the extent of the relationship between the
two teams and its impact on the business?
Investments
Decision criteria for selecting individuals to participate:
■■ Does the individual interact with another team
frequently enough to reasonably assess them?
■■ Are we sampling enough of the team to get
a representative sample of responses?
PRACTICE
OVERVIEW

Teachers’ realized that
no individual leader could
OLD LEADERS MUTUALLY ACCOUNTABLE
H
improve a cross-divisional
relationship; instead, leaders
FOR CROSS-DIVISIONAL RELATIONSHIPS
must be mutually accountable
for improved relationships. Partnership Survey Results
Illustrative
Aggregated divisional results
of the Partnership Survey Division Receiving
Functional Partner A Functional Partner B
are shared with all divisional the Rating
leaders. Divisional scorecards Department Providing the
Favorable Neutral Unfavorable Favorable Neutral Unfavorable
include targets based on Rating
Partnership Survey results and Fixed Income and
action items linked to improving 61% 19% 20% 25% 30% 45%
Alternative Investments
scores. Private Capital 82% 10% 8% 33% 38% 29%
Divisional leaders are Investments Infrastructure 55% 30% 15% 21% 60% 19%
accountable for ensuring their Public Equities 62% 20% 18% 59% 35% 6%
teams improve and/or maintain
Tactical Asset Allocation
productive partnerships across 71% 19% 10% 67% 29% 4%
and Natural Resources
divisions.
Leaders from Investments (client) and Functional Partner B are responsible for addressing high unfavorables that
Functional Partner B received from divisions of the investment function.

Note: Functional partners may contain multiple divisions.
Partnership Survey Results Incorporated into Divisional Scorecard Action Items

Illustrative
Division: Investments (Client)

Objective: Improve Partnership with Functional Partner B
Indicator Status
Partnership Survey Results Below Target Divisional scorecards
■■ Above Target (Favorables above 75%) include targets for the
■■ On Target (Favorables 60%–75%) Partnership Survey results
■■ Below Target (Favorables 59% or lower) and corresponding action
items based on those
Partnership Action Planning In Progress
results.
Workshops Planned If Below Target
PRACTICE
OVERVIEW

After receiving the Partnership
Survey results, leaders create
NHANCE PARTNERSHIPS THROUGH
E
action plans (e.g., workshops,
team-to-team conversations)
CROSS-DIVISIONAL ACTION PLANNING
to break down barriers
between divisions and enhance Follow-Up Action Item Example: Half-Day, Joint Team Workshops
partnerships.
Leaders have flexibility in how they
When leaders and their teams design the workshop. Considerations
receive low cross-divisional may include:
ratings, the leaders of the ■■ Whether they are in the room
client and functional partner for workshops,
are responsible for implementing ■■ Structure of the day, and
an action plan to improve the
■■ Specific session objectives.
partnership. To match the current
Employees from Employees from
health of the partnership and the
Investments Functional Partner
size of the involved teams, action
items vary and may include: Source: Ontario Teachers’ Pension Plan; CEB analysis.
■■ One-on-one conversations
between divisional leaders
for smaller teams, and
Workshop Agenda Items Based on Joint Solution Identification
■■ Half-day workshops for larger
teams with low Partnership Agenda
Survey results. Time Topic Details
1:00 Meeting Kick-Off ■■ Context setting and workshop objectives

■■ Workshop overview
1:15 Break-Out Session ■■ Consensus building on perspectives to the discussion questions (Prework Item #2)
2:15 Large Group ■■ Review perspectives and results from each team’s breakout.
Session ■■ Identify and prioritize most important issues and opportunities for action. Mixed-team
working sessions
3:15
3:15 Mixed-Team
Mixed-Team ■■ ■■ Smaller
Smaller teams
teams work work on
on identified identified
priorities priorities
and propose andplan
and action propose
to move an action plan
ensure that both
Working Session
Working Session to move
the priority the priority forward.
forward
■■ partners identify
4:00 Joint Action Large group review and joint action planning
Planning ■■ Input to a shared score card item solutions.
4:50 Wrap Up ■■ Summary of agreements and next steps
■■ Wrap up, leaders close workshop
5:00 Adjourn
PRACTICE
OVERVIEW

Improvements in cross-
divisional relationships derived
IMPROVEMENTS IN CROSS-DIVISIONAL
from the Partnership Model
have improved business
RELATIONSHIPS CREATE BETTER OUTCOMES
outcomes at Teachers’. In
addition, since the inception Partnership Index Results Improving Year-Over-Year
of the Partnership Principles, Partnership Index Aggregate Scores, 2012–2013
Teachers’ has improved in
overall partnership ratings.
80%
71%
“The Partnership Model helps me do my job
55% better as a leader. The results show me where
our partnerships are strong and where we need
to improve. I can then have more informed
40%
discussions with other leaders as to how to make
our partnerships even stronger.”
Rosemarie McClean
SVP of Member Services
0% Ontario Teachers’ Pension Plan
2012 2013
PRACTICE
OVERVIEW

CROSS-DIVISIONAL PARTNERSHIP REVIEW: IMPLEMENTATION CHECKLIST
1. Design Program Content and Experience
s part of the annual performance objective-setting process, interview a sample of leaders and employees to understand how partnership and collaboration
A
work across functions at the organization.
Ask leaders questions such as:
How do you think your team works with other functions?
Does your team get what it needs from functional partners or clients?
How could your team collaborate and partner better with other functions?
Ask employees questions such as:
How do you work with other functions?
Do you feel you get what you need from functional partners or clients?
Do you feel expectations are clear on both sides of the relationship?
How well does your leader understand your team’s relationship with other functions?
Tip: Consider using an unbiased third party to interview employees and leaders.
Based on leader and employee responses, identify five to eight key partnership principles. Consider principles based on themes such as:
Support—Do functional partners organize their work to help clients?
Alignment—Are functional partners aligned selectively and appropriately with clients and with strategic business objectives?
Access—Can clients easily access functional partners?
Transparency—Do functional partners share and report transparently, as appropriate, to drive effective business decisions?
Accountability—Are clients and functional partners held accountable for a healthy relationship?
Communication—Do functional partners communicate effectively and proactively with clients?
2. Create a Survey to Assess Partnership Principles
Create a survey to assess teams and business units against the partnership principles. Consider the following when creating the survey:
Create one or two questions that align with each principle.
Tip: Keep the survey short (less than 15 minutes).
Use a consistent and easy-to-understand scale in the survey.
Tip: Leave space for employees to write open-ended comments about partnership.

ROSS-DIVISIONAL PARTNERSHIP REVIEW: IMPLEMENTATION CHECKLIST
C
(CONTINUED)
3. Deploy the Survey
etermine which teams will receive the survey and which teams they will assess. Consider the following questions when selecting functions to survey one
D
another:
What is the extent of the relationship between the functions and their impact on the business?
How frequently do these two teams or functions interact?
Tip: Let teams decide for themselves whom they should survey, but oversee the process to ensure surveys are reaching the right teams.
Identify the individuals within the team who will receive the survey. Consider the following questions when selecting individuals:
Does the individual interact with another team frequently enough to accurately assess it?
Are we sampling enough of the team to get a representative sample of responses?
Deploy the survey annually; consider deploying it in coordination with annual performance reviews or objective-setting processes.
Tip: The same employees do not necessarily need to receive the survey every year.
4. Aggregate Survey Results into a Scorecard
Collect survey results into a corporate-wide scorecard to hold leaders accountable for effective partnerships.
Tip: Consider publishing the leaders’ names on the scorecard.
hare survey results within the entire leadership team to ensure hard and soft accountability.
S
Include survey results in leaders’ scorecards to hold them accountable for relationships.
Determine and communicate what scores will be considered on target, below target, and above target for Partnership Survey results.
5. Create Leader-Led Workshops to Enhance Partnerships
hen leaders and their teams receive below-target scores, hold the leaders of both functions (the one that received a low score and the one that gave a low
W
score) accountable by having them host a workshop for both teams keep the following in mind when designing workshops:
Allow leaders of both functions to determine the agenda.
Allow leaders to determine whether they will be in the room during the workshop or have HR moderate.
Ensure specific objectives are set to address low partnership scores.
Ensure workshops contain mixed-team sessions so that both sides of the partnership must work together to address the relationship.
Tip: Allow leaders to take the lead on hosting and designing workshops, but HR should serve as a partner and ensure workshops actually occur.

Leaders who clearly understand
their peers’ objectives can more
LEADER GUIDE: IDENTIFYING OPPORTUNITIES
accurately identify and define
opportunities for high-impact
FOR PEER CONTRIBUTIONS
contributions in their objectives.
Instructions: Consider the following questions to help you learn about your peers’ objectives. These questions
may be used to identify opportunities for you to contribute to your peers’ objectives, or may be used to guide
conversations intended to identify MBOs that support your and your peers’ individual goals.
LEADER NEEDS TEAM NEEDS

What does my peer need to achieve his or her goals What does my peer’s team need
and objectives? to achieve their goals and objectives?
hat activities or deliverables are my peers

W hat deliverables are my peer’s team responsible
W
accountable this year? for this year?
hat goals or deliverables are highest priority

W hat goals or deliverables are most difficult for
W
for my peer? my peer’s team to complete?
here does my peer feel the most pressure

W hat activities require the largest amount of
W
or urgency? cross-team support?
hat does my peer need from me to achieve his

W ho does my peer’s team rely on to receive
W
or her individual objectives? inputs or approve outputs?
hat other peers does my peer most frequently

W hat other teams does my peer’s team most
W
work with? frequently work with?
COMPLIMENTARY OBJECTIVES
What goals and objectives are shared or complimentary between myself and my peer?
ow do our respective teams both support the long-

H here do my peer’s responsibilities and objectives
W
term organizational strategy? most align with my own?
ow is my team supporting the organizational strategy

H hat objectives is my peer’s team working on that my
W
this year? team has completed in the past?

How is my peer’s team supporting the organizational hat objectives is my team working on that my peer’s
W
strategy this year? team has worked on in the past?
here do my peer’s responsibilities and objectives

W hat other teams share objectives that are similar in
W
conflict with my own? kind to the objectives of myself and my peer?

REDESIGN LEADER EVALUATIONS TO ADDRESS REWARDS RISK
■■ Almost all organizations have created Enterprise Leadership ■■ Invest in coaching and development to help managers identify
objectives, but only 35% of leaders believe they are financially and evaluate evidence of Enterprise Leadership outcomes, not
rewarded for contributing to others. just behaviors.
■■ Few organizations recognize Enterprise Leaders during ■■ Audit leadership objectives to ensure evaluations follow four key
performance reviews; in fact, less than one-fifth of Enterprise principles:
Leaders receive top performance ratings in performance
–– Quantified—Quantify evaluations to make Enterprise Leadership
evaluations.
outcomes tangible.
■■ Many organizations focus on individual behaviors to evaluate –– Personalized—Personalize Enterprise Leadership objectives
Enterprise Leadership, which creates the perception of a rewards to connect leader’s specific contributions to business goals.
–– Clarified—Clarify the connection between leader contributions and
risk.
pay.
–– Shared—Assess leaders’ ability to work on shared outcomes with
peers and teams.
■■ Structure the evaluation process to capture Enterprise

Leadership outcomes, not just behaviors.

A leadership environment where leaders need to be evaluated on the outcome of their contributions to
remove a rewards risk has several implications for the head of HR. In particular, heads of HR should consider
the following:
How can I adjust our performance evaluation process to ensure we recognize Enterprise Leaders
1 as top-performing leaders?
How well equipped are my HRBPs to explain to leaders and their managers how contributions to
2 others affect leader rewards?
Do our leadership performance objectives take into account contributions leaders need to make
3 to other leaders?
Have we trained our leaders’ managers to evaluate Enterprise Leadership outcomes, not just
4 collaborative behaviors?
How well equipped are my HRBPs to support our leaders during objective setting as they work
5 together to identify mutually beneficial Enterprise Leadership objectives?

I. Shift Mind-Sets to Adapt II. Increase Transparency to III. Redesign Evaluations
A to Lack of Control Address Insufficient Information to Reduce Rewards Risk B
Individual Leadership Enterprise Leadership
Help Leaders Change Their Mind-Sets, Rather Build Transparency Into Relative Strengths, Rather Reward Enterprise Leadership
Than Just Building New Skills Than Just Clarifying Universal Expectations Outcomes, Not Just Behaviors
■■ Develop new ■■ Focus training
leadership skills. Change leader mindsets about their Optimize capabilities across leadership investment on leader
Quantify Enterprise Leadership
Update leadership responsibilities by challenging assumptions teams, rather than trying to perfect mind-sets, not just
■■
to make outcomes tangible.
competency models. about their roles. individual capability. skills.
■■ Optimize individual
■■ Design leader
leader capability. assessments
to maximize
■■ Include additional transparency into
Network Performance Points
criteria and weight Experienced Leaders Challenge Leadership Capability Clouds peer capabilities and
to leader evaluations Personalize objectives to connect business needs.
to track collaborative Equip teams to self-identify
enterprise contribution opportunities, contributions to business goals.
behavior.
■■ Deploy leaders to
don’t just cascade them down. optimize capability
throughout the
Leader Guide: Apply an Enterprise Leadership leadership population.
Mind-Set to Work Activities Horizontal Goal Cascade
■■ Redesign leader
Portfolio Reviews
evaluations to
Clarify the connection between measure and reward
leader contributions and pay. Enterprise Leadership
outcomes.
Leader Guide: Understanding

Your Fit in the Leader Network Span of Influence Mapping
Assess leaders’ ability to work on shared

outcomes with both peers and teams.

© 2015 CEB All Rights Reserved. HRFR3701715SYN_11x17

Appendix
Methodology Overview ■■ M: Lack of Leader Collaboration a Top Concern for Heads of HR
■■ A: Enterprise Leadership Variable Construction ■■ N: Approximately
One-Quarter of HR Budget Spent
■■ B: D
ifferentiating Networking, Collaboration, and Network on Leadership
Performance ■■ O: Leadership Initiatives Most Commonly Focused on Building
■■ C: How to Read Maximum Impact Charts Skills, Not Changing Behaviors
■■ P: D
evelopment and Succession Strategies the Most Common
Additional Quantitative Findings
and Successful Interventions
■■ eader Effectiveness at Key Competencies
D: L ■■ Q: Low Confidence in Leaders’ Ability to Adapt
■■ etwork Performance Is the Largest Area of Opportunity
E: N to Organizational Changes
for Creating Enterprise Leaders ■■ R: Most Leader Evaluations Sufficiently Weight Enterprise
■■ F: Enterprise Leaders Achieve Higher Business Unit Net Profit Leadership Criteria
Than Individual Leaders
Additional Case Profile Resources
■■ G: Three Key Shifts in How Enterprise Leaders Lead
■■ S: Enterprise Leadership Predictors (NBK)
■■ H: P
revalence of Enterprise Leaders by Geography
■■ T: Relationship-Based Role Charters (The Lego Group)
and Industry
■■ U: Interactive Enterprise Leadership Evaluation
■■ I: L
eader and Team Network and Task Performance
(Crombie REIT)
by Geography and Industry
■■ V: Span of Influence Mapping (BD)
■■ J: E
nterprise Leaders Not Distinguished by Demographic
Characteristics
■■ K: E
nterprise Leadership Does Not Require More Time
with Others, or More Work
■■ L: Additional Survey Demographics
93
We used factor analysis to
determine the components that
A: ENTERPRISE LEADERSHIP VARIABLE CONSTRUCTION
drive Enterprise Leadership.
CEB Survey and Analysis Process
STEP 1 STEP 2
Collect ratings of leader and team performance. Determine relationship between different
performance-rating items.
■■ Collect manager rating of leader individual and ■■ Use factor analysis to measure the interaction
network performance items. and interdependence between leader and team
performance categories.
■■ Collect leader rating of team’s aggregate individual
and network performance items.
STEP 3 STEP 4
Create individual and network performance indices. Identify Enterprise Leaders.
■■ Aggregate and average individual items identified ■■ Identify individuals as Enterprise Leaders who have
in step 2 into individual and network variables. a score of at least “effective” in both individual and
network variables.
Appendix 94
A: ENTERPRISE LEADERSHIP VARIABLE CONSTRUCTION (CONTINUED)
What Outcomes Comprise Enterprise Leadership?
INDIVIDUAL LEADERSHIP
+ NETWORK LEADERSHIP
Leader Individual Performance Leader Network Performance
■■ On-time task and/or assignment completion ■■ Exporting talent to other parts of the business
■■ Error-free tasks and/or assignments ■■ Exporting ideas to other parts of the business
■■ High-quality work ■■ Creating business strategies that benefit other parts of the business
■■ Exporting ideas outside of the organization (e.g., vendors, suppliers,
professional networks)
Team Individual Performance
■■ Effectively transferring working methods, techniques, or tools from other parts
of the organization
■■ High output per hour worked ■■ Effectively transferring great ideas from other parts of the organization
■■ On-time task and/or assignment completion ■■ Effectively transferring skills and knowledge from other parts of the
■■ Error-free tasks and/or assignments organization
■■ Improving team member performance ■■ Using work and resources from other leaders
■■ Effectively transferring skills and knowledge to team members ■■ Using other leaders’ input
■■ Providing high-quality input to work of team members and those outside of the ■■ Importing talent from other parts of the business
team ■■ Importing ideas from other parts of the business
■■ Being a critical resource for team members ■■ Importing ideas from outside of the organization (e.g., vendors, suppliers,
professional networks)
Team Network Performance
■■ eveloping useful new ideas for products, services, and/or process

D
improvements
■■ Effectively transferring great ideas from other parts of the organization
■■ Effectively transferring skills and knowledge from other parts of the organization
■■ Effectively transferring working methods, techniques, or tools from other parts
of the organization
■■ Improving performance of employees outside of the team
■■ Using resources outside of the team
Source: CEB analysis. ■■ Using work and resources from members outside of the team
Note: Items were grouped using factor analysis.
Appendix 95
Networking, collaboration, and
network performance are three
B: D
IFFERENTIATING NETWORKING, COLLABORATION,
distinct types of interactions
leaders use to improve their
AND NETWORK PERFORMANCE
performance.
Importance of Interactions to Leader Performance
NETWORKING COLLABORATION NETWORK PERFORMANCE
Cultivating productive Working with others Contributing to others

relationships with to achieve a common goala to improve their
professional contactsa performance and using
others’ contributions
to improve one’s own
performance
Leaders from within and Leaders working within the Leaders working within
outside of the organization same team or organization and outside of the
organization
Participants
Frequently limited to one-off, Close cooperation through Varied interactions

in-person conversations e-mails, phone calls, and embedded within activities
and/or e-mails in-person meetings for the critical to the leader’s role
duration of a project
Common Interactions
To advance one’s career by To improve the outcome of To maximize the collective

using connections to learn a specific project by dividing value of the organization’s
about opportunities and seek the work and/or making talent by using one another’s
information or advice use of others’ skills and comparative strengths
Goal perspectives to improve each other’s
performance

a
Adapted from Merriam-Webster Online Dictionary.
Appendix 96
A maximum impact chart
shows the maximum amount of
C: HOW TO READ MAXIMUM IMPACT CHARTS
improvement an organization
can realize by moving from Maximum Impact of Drivers 1 and 2 on Enterprise Leadership
being very ineffective to very Illustrative
effective at a specific driver.
Organizations can see, at

most, a 15% improvement
in Enterprise Leadership
by implementing driver 1.
16%
15%
Organizations can see, at

most, a 5% improvement
in Enterprise Leadership
8%
by implementing driver 2.
5%
0%
Driver 1 Driver 2
Note: Both drivers are measured on a seven–point effectiveness scale.
The impact on Enterprise Leadership is calculated by comparing two statistical estimates: the predicted impact when a respondent rates
a driver with a relatively high score and the predicted value when a respondent rates a driver with the relatively low score. The effect of
the drivers on Enterprise Leadership is modeled using a variety of multiple regressions with controls.
Appendix 97
Leaders’ effectiveness at key
competencies has remained
D: LEADER EFFECTIVENESS AT KEY COMPETENCIES
relatively constant.
Most Leaders Demonstrate Sufficient Effectiveness at Common Leadership Competencies
Percentage of Leaders Rated as Effective at Key Competencies
2007
100%
2013
81%
77% 77%
74% 74% 73% 73%
70% 71%
69%
66% 67% 67% 67%
65% 65%
62%
60%
58%59%
54% 56% 54% 54% 55%
50%
49%
46% 46%
0%
n
ng
ce
ts
y
en
en
en
lit
tio
tio
tio
tio
tio
tio
in
ul
en
ki
gi
lv
m
em
m
es
ca
za
ga
ra
va
ira
in
flu
So
A
e
dg
rR
bo
Th
no
i
llo
sp
ag
ag
rit
In
el
Ju
m
la
A
In
fo
In
io
an
an
al
D
le
ol
Pr
ce
ic
es
M
tM
ob
C
rit
ur
riv
is
Pr
en
C
o
ris
D
es
l
Ta
C
R
n = 1,618 (2007); 333 (2013).

Source: CEB 2007 Talent Management Effectiveness Survey; CEB 2013 Leadership Development Survey.
Appendix 98
Although a majority of leaders
are effective at leader and team
E: N
ETWORK PERFORMANCE IS THE LARGEST AREA OF
individual performance, most
leaders are ineffective at leader
OPPORTUNITY FOR CREATING ENTERPRISE LEADERS
and team network performance.
Leader Effectiveness at the Components of Enterprise Leadership
Percentage of Leaders Surveyed
INDIVIDUAL LEADERSHIP NETWORK LEADERSHIP
Leader Individual Performance Leader Network Performance

Achieving own individual tasks Improving others’ performance
and assignments and using others’ contributions
to improve own performance
77% 31%
of leaders of leaders
are effective. are effective.
Team Individual Performance Team Network Performance

Achieving own individual tasks Improving others’ performance
and assignments and using others’ contributions
to improve own performance
59% 35%
of leaders have of leaders have
effective teams. effective teams.
n = 908.
Appendix 99
Enterprise Leaders improve
their own business unit net
F: E
NTERPRISE LEADERS ACHIEVE HIGHER BUSINESS
profit growth by 10% and also
contribute an additional 4%
UNIT NET PROFIT THAN INDIVIDUAL LEADERS
improvement to other business
units. Maximum Impact on Business Unit Net Profit Growtha
Enterprise Leadership Impact Enterprise Leadership Impact

on Own Business Unit on Other Business Units
10% 4%
10%
4%
Impact from
Maximum Impact on Business Unit Net Profit Growth
Enterprise Implication: An Enterprise

Leaders 4% Leader creates a spillover
effect on other business
in Other units.
Business
Units
5% The benefit to their own

business unit that leaders
3%
achieve through network
leadership
3%
0%
Individual Network Spillover on
Leadership Leadership Other Business
Units
n = 908 leaders; 362 connections.
Source: CEB 2014 Enterprise Leadership Network Analysis.
a
To assess the spillover effect of Enterprise Leadership, we created a dataset of leader-to-leader connections. Leaders were asked to indicate
the names of leaders (i.e., a set of peers) with whom they frequently collaborated. An average Enterprise Leadership score was calculated
for each leader’s set of peers, which was used to assess peers’ effect on the leader’s business unit.
Appendix 100
Enterprise Leaders differ from
individual leaders in three key
G: T
HREE KEY SHIFTS IN HOW ENTERPRISE LEADERS
shifts in their leadership.
LEAD
Individual Enterprise
Leaders Leaders
SHIFT 1 Give Mored 15% 19%

Enterprise Leaders
Take—and Give—with Peers are 1.5x more effective
Individual leaders use peer contributions to at evenly giving and Take More 49% 30%
improve their business unit. Enterprise Leaders taking than individual
use and provide contributions to improve the leaders.a Evenly Give
broader enterprise. 35% 51%
and Take
SHIFT 2
Enterprise Leaders are
Push—and Pull—Team Contributions
1.2x more likely to pull
Individual leaders delegate work to their team.
than other leaders.b
Enterprise Leaders delegate work and ensure Pull 82% 97%
team contributions receive the resources and
visibility needed for success.
SHIFT 3
Enterprise Leaders
Facilitate—Don’t Direct—Team Performance
are 1.3x more likely to
Individual leaders provide their teams with
facilitate than other
direction to accomplish their tasks. Enterprise Facilitate 63% 88%
leaders.c
Leaders connect their teams with those who
can enhance and benefit from the team’s
performance.
n = 908; 2,101.
a
Enterprise Leaders are more likely than other leaders to evenly give and take from their peers, as measured by an average of survey questions answered by leaders’
managers assessing leaders’ propensity to give to their peers and leaders’ propensity to take from their peers.
b
Enterprise Leaders are more likely than other leaders to “find their direct reports’ feedback useful for improving their own performance,” as rated by the manager.
c
Enterprise Leaders are more likely than other leaders to “promote and facilitate coordination and cooperation among members of his or her team,” as rated by the team.
d
No significant difference exists between leader populations.
Appendix 101
The distribution of Enterprise
Leaders does not significantly
H: P
REVALENCE OF ENTERPRISE LEADERS
vary across regions or
industries.
BY GEOGRAPHY AND INDUSTRY
Industry and Geography Comparisons
Enterprise Leaders
All Leaders 12%

Asia 16%
Australia/New Zealand 12%a
Region EMEA 8%a
North America 11%a
South America Insufficient Data
Construction 8%a
Financial Services 8%a
Government/Nonprofit 15%a
Hospitality 4%a
Industry Professional Services 19%
Real Estate 23%
Technology 11%a
Telecommunications 21%
Transportation Insufficient Data
n = 908.
a
Indicates difference is not significant at the 95% confidence level.
Note: A green (light) or red (dark) box indicates a statistically significant positive or negative difference at the
95% confidence level compared to the overall leader benchmark (top row).
This table is intended to indicate whether the proportion of Enterprise Leaders differ by region and
industry. The percentages may not average to 12% because different percentages were only listed if they
were statistically different from 12% at the 95% level of confidence.
Appendix 102
The effectiveness at different
components of Enterprise
I: LEADER AND TEAM NETWORK AND TASK
Leadership does not
significantly vary across regions
PERFORMANCE BY GEOGRAPHY AND INDUSTRY
or industries.
Industry and Geography Comparisons
Percentage of Leaders Effective at Network and Task Performance by Geography and Industry
Leader Task Leader Network Team Task Team Network

Performance Performance Performance Performance
All Leaders 77% 31% 59% 35%
Australia/New Zealand 78%a 32%a 60%a 34%a
Asia 68% 35%a 52% 42%
Region EMEA 74%a 26% 58%a 36%a
North America 88% 32%a 66% 36%a
South America Insufficient Data Insufficient Data Insufficient Data Insufficient Data
Construction 65%a 41%a 46%a 19%
Financial Services 90% 40%a 58%a 35%a
Government/Nonprofit 83%a 41% 61%a 37%a
Hospitality 54% 15% 39% 28%a
Industry Professional Services 85%a 44% 59%a 36%a
Real Estate 87%a 34%a 83% 51%
Tech 80%a 31%a 59%a 34%a
Telecommunications 66% 39%a 64%a 59%
Transportation Insufficient Data Insufficient Data Insufficient Data Insufficient Data
n = 908.
a
Indicates difference is not significant at the 95% confidence level.
Note: A green (light) or red (dark) box indicates a statistically significant positive or negative difference at the 95% confidence level compared to the overall
leader benchmark (top row).
This table is intended to indicate whether the proportion of Enterprise Leaders differ by region and industry. The percentages may not average to
12% because different percentages were only listed if they were statistically different from 12% at the 95% level of confidence.
Appendix 103
J: ENTERPRISE LEADERS NOT DISTINGUISHED BY DEMOGRAPHIC
CHARACTERISTICS
Enterprise Leaders and individual leaders have largely the same demographic profile.
No Significant Difference in Age No Significant Difference in Gender No Significant Difference in Education

Average Age in Years Percentage of the Population That Are Enterprise Highest Level of Educational Attainment
Leaders
Other Graduate
50 45 43 100% 89% 85% 100% Degree
Individual 16% 18%
Leaders 17% MBA
20%
25 50% Enterprise 50% Bachelor’s
Leaders
38% 43%
11% 15%1
15% Vocational,
18% 13% Technical,
0 0% 0% 11% 6%
or Associate
Individual Enterprise Male Female Individual Enterprise High School
Leaders Leaders n = 908. Leaders Leaders or Less
n = 908. Source: CEB 2014 Enterprise Leadership Survey. n = 908.
Source: CEB 2014 Enterprise Leadership Survey. 1
Difference is not statistically significant. Source: CEB 2014 Enterprise Leadership Survey.
No Significant Difference in Position Tenure No Significant Difference in Organizational Small Difference in Years of Work Experience
Average Years in Current Position Tenure Average Years of Work Experience
Average Years with Current Employer
24
24 24 24 22
12 12
11 11 12
5 4
0 0 0
Individual Enterprise Individual Enterprise Individual Enterprise
Leaders Leaders Leaders Leaders Leaders Leaders
n = 908. n = 908. n = 908.
Source: CEB 2014 Enterprise Leadership Survey. Source: CEB 2014 Enterprise Leadership Survey. Source: CEB 2014 Enterprise Leadership Survey.
No Significant Difference in Span of Control

Average Number of Direct Reports
10 9 9
0
Individual Enterprise
Leaders Leaders
n = 908.
Appendix 104
Enterprise Leaders do not
spend more time working with
K: E
NTERPRISE LEADERSHIP DOES NOT REQUIRE
others than their counterparts.
MORE TIME WITH OTHERS, OR MORE WORK
Enterprise Leaders and Other Leaders Spend the Same Amount of Time Working with Others
Average Number of Hours Leaders Spend per Week Alone and with Their Network
TOTAL 51 Hours 51 Hours
Alone 9 Hours 9 Hours
Peers Outside of Organization 2 Hours 2 Hours
Peers Within Organization 10 Hours 9 Hours
Junior Employees 23 Hours

23 Hours
More Senior Leaders 7 Hours 8 Hours
Individual Leaders Enterprise Leaders

n = 717.
Appendix 105
The best leaders understand
that Enterprise Leadership
K: E
NTERPRISE LEADERSHIP DOES NOT REQUIRE
opportunities already exist
within their day-to-day work.
(CONTINUED)
Enterprise Leaders Make Better Use of the Time they Already Spend with Others
Leader Calendar (Illustrative) Conventional Approach Enterprise Leadership

Approach
8
Sales Call
9 Provide Enterprise View

Provide team with
Strategic Provide Local View
organizational context by
10 Planning Provide team with business
showing links between
Meeting unit context and updates.
Conference Call team and organizational
goals.
11
Conference Call
Client Meeting
12
Lunch
Offer Feedback Offer and Solicit Feedback
1 Direct Report One-on-One Provide feedback to Share and ask for feedback
direct report. from direct report.
Review Reports
2 Role Model Behaviors Create Connections
Executive Meeting Influence team behavior Influence team behavior
through individual conduct. by connecting peers
3
with other colleagues
Budgeting Meeting Product Meeting
throughout the
4 organization.
Vendor Call
Empower Team Ownership
“Leaders have a problem 5 Direct Team Interactions
Empower team to
of not being ‘present’ Team Meeting Assign tasks to individual
negotiate ownership of
in their activities. Leader team members.
tasks.
6
performance is not only about
Create Presentation
prioritizing what to spend time
on; it’s also about being fully 7
aware in the activity you have
chosen.”
8
SVP HR Call with International Office
Manufacturing Industry
9
Appendix 106
We surveyed leaders from mid-
level to the CEO level and from
L: ADDITIONAL SURVEY DEMOGRAPHICS
a variety of functions within the
organization. Leadership Survey Participants by Level
5% 1%
General Manager CEO or Functional Head
3%
Senior/Executive VP
11%
Division Head/VP
42%
Mid-Level
38%
Department Head/Director
n = 908.
Leadership Survey Participants by Function
5%
Corporate Strategy
4%
Customer Service and Call Center
15% 6%
Other Engineering and Design
(Excluding Software Engineering)
8%
Finance and Accounting
17%
Sales 6%
HR
3%
11%
Quality Control and Assurance
Information Technology
25% and Systems (including
Operations (Service or Product Delivery) Software Engineering)
n = 908.
Note: Total does not equal 100% due to rounding.
Appendix 107
We expanded our analysis
of Enterprise Leadership to
L: ADDITIONAL SURVEY DEMOGRAPHICS (CONTINUED)
include additional data from our
2014 study, The Performance Performance Transformation Leader Performance Transformation Leader
Transformation. Participation by Region Participation by Level
6%
Australia and
New Zealand
21%
CEO or
12% 34% Functional
South Asia Head
America
43%
Director
18% and Below
26% General
North Manager
America
22% 9%
Europe, Middle Executive/Senior 9%
East, and Africa Vice President Division Head/Vice President
n = 2,101. n = 2,101.
Performance Transformation Leader Performance Transformation Leader

Participation by Industry Participation by Function
5%
12% Construction
Other 4% 16%
19%
Consumer Goods Administrative
Other
3% 8% Support
Transportation Education
9%
3%
3% Corporate
12% Energy/Utilities
R&D Strategy
Technology 8% 8% 3%
Financial Operations Communications
5% Services
Retail 3%
8% Customer Service
6% Government/ 18%
Professional Nonprofit Information 7%
Services Technology/ Engineering and
6% Systems (Including Design (Excluding
Health Care Software Engineering) Software Engineering
7%
Mining 13% 8%
HR 6%
Heavy Manufacturing
Finance/Accounting
n = 2,101. n = 2,101.
Appendix 108
A majority of heads of HR report
lack of collaboration as a barrier
M: L
ACK OF LEADER COLLABORATION A TOP CONCERN
to leadership performance.
FOR HEADS OF HR
Other top responses included
fixed mind-sets, a narrow focus on Percentage of Heads of HR Expressing a High Level of Concern about Leadership Barriers to Performance
individual over collective success,
and lack of gender diversity.
70%
62%
56%
54%
50% 49% 48%
42%
40%
35%
0%
Lack of Fixed Narrow Focus Lack of Unmanageable Disruptive Insufficient Lack of
Organizational Mind-Sets on Individual Gender Workloads Organizational Visibility into Organizational
Collaboration Objectives Over Diversity Change the Goals of Awareness
Collective Success Others
n = 197.
Appendix 109
On average, less than 6% of HR
budgets is spent on leadership
N: A
PPROXIMATELY ONE-QUARTER OF HR BUDGET
assessment products, and
18% of HR budgets is spent
SPENT ON LEADERSHIP
on leadership development
initiatives. Percentage of HR Budget Spent on Leadership Assessment Products
60% 58%
Eighty-nine percent of organizations
Percentage of Organizations
spend, at most, 10% of their HR budgets
on leadership assessment products.
30%
18%
14%
7%
2% 2% 0% 0% 0% 0% 0% 0%
0%
0% 1%–5% 6%–10% 11%–15% 16%–20% > 20%
n = 197.
Percentage of HR Budget Spent on Leadership Development
The median organization

24% 23%
spends 12% of its HR budget on
21% leadership development initiatives.
Percentage of Organizations
14% 14%
12% 11%
7%
6%
4%
0%
0% 1%–5% 6%–10% 11%–15% 16%–20% 21%–25% 26%–30% > 30%
n = 197.
Appendix 110
The most common goal of
leadership initiatives is to
O: L
EADERSHIP INITIATIVES MOST COMMONLY FOCUS
strengthen leadership skills.
ON BUILDING SKILLS, NOT CHANGING BEHAVIORS
Primary Goals of Leadership Initiatives, According to Heads of HR
60%
54%
43%
36%
35%
32%
30%
26%
24%
16%
11%
0%
Strengthen Change Build High- Increase Change Redefine Change Improve Improve
Leadership Organizational Performing Collaboration Leader Leadership Leader Leader Leader
Skills Culture Teams Among Behaviors Expectations Mind-Sets Adaptability Organizational
Leaders Awareness
n = 197.
Appendix 111
The most popular and, on
average, most successful
P: D
EVELOPMENT AND SUCCESSION STRATEGIES THE
leadership interventions have
focused on leader training and
MOST COMMON AND SUCCESSFUL INTERVENTIONS
succession management.
Percentage of Organizations Updating the Following for Leaders Over the Past Three Years
Succession Strategies
48% Percentage
55% Making Change
Percentage Rating
47% Change Effective
Competency Models
45%
45%
Performance Evaluations
44%
43%
Organizational Design
44%
Leader Sourcing 32%
Strategies 57%
29%
Leader Rewards
41%
28%
Needs Analysis
28%
Objective-Setting 27%
Processes 54%
24%
Diversity and Inclusion
41%
19%
Role Design
43%
17%
Networking Events
39%
10%
Transition Strategies
47%
8%
Deployment Processes
36%
7%
Mobility Policies
29%
0% 35% 70%
n = 197.
Appendix 112
Only one-quarter of heads of
HR are confident that their
Q: L
OW CONFIDENCE IN LEADERS’ ABILITY TO ADAPT
leaders can adapt to a lateral
move across the firm or a shift
TO ORGANIZATIONAL CHANGES
in business strategy.
Percentage of Heads of HR Expressing Confidence in Their Leaders’ Ability to Adapt to Strategic Changes
Only half of heads of HR are
confident that their leaders can
manage a new product or service
60%
launch.
51%
40%
36%
34%
31%
30% 29%
25% 25%
0%
A New An Expansion A New A Significant A Significant A Significant A Transfer A Significant
Product in a New Merger or Organizational Change in Job Shift in the to Another Shift in
or Service International Acquisition Restructuring Responsibilities Market or Part of the Business
Launch Market Economic Organization Strategy
Environment
n = 197.
Appendix 113
Most organizations already
give sufficient weight to
R: M
OST LEADER EVALUATIONS SUFFICIENTLY
network performance criteria
within leaders’ performance
WEIGHT ENTERPRISE LEADERSHIP CRITERIA
evaluations.
Limited Opportunity to Drive Performance by Adding More Weight to Criteria
On average, network performance
Impact of Network Performance Criteria Weight on Enterprise Leadership
criteria account for 36% of a
leader’s performance evaluation.
Moving from average weight to optimal weight

10% only increases Enterprise Leadership by 1%.
Average Weight of Network Optimal Weight of Network

Performance Criteria: 36% Performance Criteria: 56%
5% ∆ = 1%
0%
0% 40% 80%
Weight of Network Performance Criteria
n = 2,101.
Note: The impact on Enterprise Leadership is calculated by comparing two statistical estimates: the predicted impact when a respondent
rates a driver with a relatively high score and the predicted value when a respondent rates a driver with the relatively low score.
The effect of the driver on Enterprise Leadership is modeled using nonlinear regression techniques to derive the optimal weighting
of network performance.
Appendix 114
S: ENTERPRISE LEADERSHIP PREDICTORS
OVERVIEW
At the end of 2012, National Bank of Kuwait (NBK) decided to revisit its HIPO identification process because leaders
were struggling to identify future leaders aligned with changing organizational needs. The HR team realized that
leaders’ biggest challenge was marrying the criteria in traditional performance and potential assessment with new work
environment requirements. They created a third filter to enable leaders to assess a candidate’s network performance
exclusively and help leaders differentiate between talent who were and were not aligned with the future of work.
SOLUTION HIGHLIGHTS
■■ Regularly Redefine Leadership Needs Based on Relationship Requirements, Not Just Skill Requirements
Before each HIPO identification session, the general manager, division heads, and HRBP of the business unit define
what capabilities future leaders will need based on how emerging skills will affect leaders’ relationships with others.
■■ Evaluate Demonstration of Network Performance, Not Just Task Performance
NBK adds a third filter to its HIPO identification process, “Future Performance,” to determine whether future leaders
are demonstrating network performance in their daily work.
■■ Focus Action Plans on Realigning High Performers with Future Leadership Expectations
NBK creates action plans to realign High Performers with future leadership expectations. With these action plans, they
can better determine which High Performers can realistically realign themselves with new organizational standards and
which will need to assume an individual contributor role.
COMPANY SNAPSHOT
National Bank of Kuwait

Industry: Banking NBK was incorporated in 1952 as the first local bank and the first shareholding
2013 Sales: US$2.22 Billion company in Kuwait and the Gulf region. Today, NBK has more than 163
branches worldwide and operates in 16 countries around the globe.
Key Regions Middle East, North
of Operation: Africa, Asia–Pacific,
Europe, North America
Appendix 115
At the end of 2012, NBK
decided to revisit its HIPO
S: LEGACY CRITERIA A SOURCE OF PROBLEMS
identification process because
leaders were struggling to NBK Redefined Performance as CEB’s
identify future leaders aligned Model of Enterprise Contribution… …but Updating 9-Box Criteria Alone Is Insufficient
with changing organizational
needs.
The HR team found that leaders

were struggling to marry Individual Task Performance
HIPO criteria with what the Leaders’ understanding of
An employee’s effectiveness at
organization really needed in its potential is misaligned with the
achieving his/her individual tasks and
leaders. Although performance 6 3 1 work environment.
assignments
was redefined as enterprise
contribution, leaders struggled
+ Vague Guidance: Leaders define
Potential
■■
8 5 2
to connect the definition of and interpret new criteria broadly
“potential” with organizational Network Performance because the future is unclear.
changes.
An employee’s effectiveness at 9 7 4 ■■ Competing Criteria: Leaders
improving others’ performance and struggle to prioritize different
using others’ contributions to improve Performance layers of criteria.
his or her own performance
=
■■ Outdated Assumptions:
Leaders assume High-
Performer talent do not aspire
Enterprise Contribution
to align with new leadership
An employee’s effectiveness at his or expectations, so they invest
her individual tasks, contribution to primarily in improving individual
others’ performance, and use of others’ contributor skills.
contributions to improve his or her
own performance
Source: CEB analysis. Source: National Bank of Kuwait; CEB analysis.
The Juniper Practice

as Inspiration
The HR team was inspired
by CEB’s profile of Juniper
Networks to reconsider how to
measure alignment with future PRACTICE IN
needs. CONTEXT
Appendix 116
To align talent with the
changing needs of the work
S: SEPARATE NETWORK PERFORMANCE
environment, NBK evaluates
network and task performance
ASSESSMENT DURING HIPO IDENTIFICATION
to determine employees’
potential to succeed in future Steps in HIPO Identification NBK’s Approach
roles. This practice is an
evolution, not a revolution, 1 1
of the traditional HIPO
identification process. Define leadership needs based on
Needs Assessment relationship requirements, not just skill
requirements.
2 2
Designate HIPO status by demonstration

Talent Calibration
of network performance.
3 3
Focus action plans on realigning

Action Planning High Performers with future leadership
expectations.
Align HIPOs with changing leadership

Results
expectations.
Source: National Bank of Kuwait; CEB analysis. Source: National Bank of Kuwait; CEB analysis.
PRACTICE IN
CONTEXT
Appendix 117
NBK’s business unit leaders
regularly redefine leadership
: REDEFINE LEADERSHIP NEEDS BASED ON
S
criteria based on future
relationship and skill
RELATIONSHIP, NOT JUST SKILL, REQUIREMENTS
requirements.
Talent Calibration Criteria Review: Consumer and Business Banking
Before each HIPO identification Illustrative
session, the general manager,
division heads, and HRBP of
Consumer and Business
the business unit define what Banking Division Heads
capabilities future leaders will
General
need based on how emerging HRBP
Manager
skills will affect leaders’
relationships with others.
The criteria review is business

KEY STEPS AND OUTPUTS
unit specific to keep the process
informal and to allow for frequent
updates. The graphics on this
1 2 3
Where is this business going What new skills would a future How would those skill requirements
page represent how one division
in the next 3–5 years? leader need to be successful? affect key relationship requirements
might identify the criteria for their
for the future leader?
business unit. 1. Mobile banking will 1. Data Analytics, Marketing
increase by 400% in the next 1. N
eeds strong relationships
five years. 2. F
inancial Planning, Legal/
with IT, Marketing, and Sales
Regulatory, Middle -Market
2. Asset management services to identify/assess trends
Banking
will expand into middle- 2. N
eeds to integrate bankers
class market. with financial planners and
real estate team for cross-sell
opportunities
Tips for Considering Relationship Requirements

■■ What teams currently use the skills that are emerging in this business unit?
Ensure emerging relationships ■■ Will customers interact with this business unit differently in the future?
are mutually acknowledged.
Would that affect any relationships with other stakeholders?
Before talent calibration, each
Source: National Bank of Kuwait; CEB analysis.
general manager submits his or
her business unit’s relationship
requirements criteria to HR to
ensure emerging relationships PRACTICE IN
are mutually acknowledged. CONTEXT
Appendix 118
NBK measures individual
performance and potential,
S: EVALUATE DEMONSTRATION OF NETWORK
but designates HIPO status
based on interdependent
PERFORMANCE, NOT JUST TASK PERFORMANCE
performance.
Elements of NBK’s HIPO Identification Method
In addition to conventional Illustrative
performance and potential
measures, NBK adds a third
filter, “Future Performance,” 9-Box Assessment Third Filter Measuring Network Performance: “Future Performance”
to determine whether talent
are building the right
3 Future Performance Criteria: Consumer and Business Banking
relationships and skills 2 6 3 1
to be aligned with future Does this individual demonstrate building the right relationships and skills
leadership expectations. Future 8 5 2 for the future?
Potential
performance criteria is pulled
directly from the pre-talent Identifies emerging partnerships: Identifies places to partner
9 7 4 with support functions (IT, Marketing, Sales)
calibration criteria review.
uilds rapport with stakeholders: Shares consumer insights with
B
The filter is used not only to Performance 1 real estate peers
remove potential HIPOs from
the pool but also to promote pplies future skills in peer interactions: Analyzes data and
A
Candidate A: Regional Manager communicates service trends
aligned talent who might
otherwise be overlooked. nables others to align with changes: Broadens team’s sales pool
E
Candidate B: Regional Manager to include revenue from advisory services
Benefits of Future Performance

Criteria
■■ Third filter easily integrates HIPO Designation
into current 9-box calibration. Justification
■■ Separate network Candidates must demonstrate andidates A and B both demonstrated
C
Candidate A
performance criteria gives ability to identify new stakeholders.
1 High performance, Regional Manager: NO
leaders exclusive space to nly Candidate B demonstrated working
O
consider that element of 2 High potential, and Candidate B differently with direct reports.
leadership. Regional Manager: YES
3 Future performance. andidate A showed hesitancy in working
C
■■ Application of filter after with nontraditional stakeholders.
9–box assessment provides
leaders a visualization for
why top talent is no longer PRACTICE IN
leadership material. CONTEXT
Appendix 119
After talent calibration, NBK
creates action plans to enhance
: USE ACTION PLANS TO REALIGN HIGH
S
and improve organizational
network performance.
PERFORMERS WITH NEW EXPECTATIONS
NBK’s three talent segments NBK’s Talent Segment Action Plan
are based on an individual’s
alignment with future
performance criteria:
■■ HiPots—Demonstrates high High Potential (HiPots) High Performer (HiPerfs) General Performer (Perfs)
performance, potential, and Demonstrate: Demonstrate: Demonstrate:
future performance; ■■ High or moderate performance ■■ High performance ■■ Moderate performance
■■ High or moderate potential ■■ High potential ■■ Moderate potential
■■ HiPerfs—Considered HIPO in
old model, demonstrates high ■■ Future performance
performance and high potential; Development is focused on: Development is focused on: Development is focused on:
and ■■ Preparing for a new role Enhancing network performance
■■ Improving skills and relationships
■■
■■ Senior leadership competencies

■■ Perfs—Demonstrates moderate
performance and potential
alone
NBK development for High- High-Performer Development Enhances Network Performance and Differentiates Future HIPOs
Performer talent is designed
to enhance their network The High-Performer talent segment receives development to enhance their network performance, such as:
performance, which helps ■■ Workflow shadowing,
NBK get a sense of which ■■ Cross-functional mentorships,
candidates could realistically
realign themselves with the
■■ Manager engagement workshops, or
new organizational standards ■■ Classroom training on network performance.
and which should assume an
individual contributor role.
Enable Managers to Speak to Changes in Segmentation
NBK requires managers to speak with their talent about which segment they have been designated and
has created a series of visuals to help managers communicate the differences. To learn more, please refer
to the Implementation Guide.
PRACTICE IN
CONTEXT
Appendix 120
By separating network
performance into its own filter
: NETWORK PERFORMANCE FILTER ALIGNS
S
during HIPO identification,
NBK’s leaders are better able
HIPOs WITH CHANGING ORGANIZATIONAL NEEDS
to identify future leaders
aligned with organizational HIPO-Designated Talent, Before and After Implementation of the Network Performance Filter
changes.
One measure of success that NBK’s future performance filter has

NBK refers to is the size of increased the accuracy of its HIPO
identification process; as a result, it
its HIPO pool, which was
reduced the size of the HIPO pool
reduced as NBK’s leaders could by 32% between 2012 and 2013.
1x
more accurately determine
which talent should truly be
considered HIPO.
0.68x
2012 2013
“This practice has helped our general managers take a harder look at the talent underneath them and
assess if their people will be successful in 2020. Some of the answers haven’t been good, but the quality
of conversations and evaluations of talent have really improved.
Because work is changing so much, we cannot afford to continue to be led by conventional thinking.
This practice will give us lot more clarity in what our successor pool looks like and where we need to push.”
Fred Carstens
Deputy Head of HR
National Bank of Kuwait
PRACTICE IN
CONTEXT
Appendix 121
CEB Implementation Guide
Enterprise Leadership Predictors |
Contextualizing This Practice for Your Organization’s Needs
and Resources
■■ Implementation Checklist
■■ Implementation Q&A
■■ Additional Resources
Appendix 122
S: ENTERPRISE LEADERSHIP PREDICTORS: IMPLEMENTATION CHECKLIST
1. Define Skill and Relationship Needs for Future Leaders
Before the annual talent calibration meeting, host a meeting for the senior leaders and HRBP of each business unit to define future leadership needs.
Needs should reflect the business unit’s strategic direction over the next three to five years.
Determine what new skills will be important for future leaders based on anticipated leadership needs.
Define what new relationships will be important for future leaders based on anticipated leadership needs.
Define ways that future leaders could interact with customers or peers in other units differently to hypothesize how these relationships might change.
Tip: Determine which other functions already use the skills that are emerging for the business unit to identify future partnerships.
Draft emerging skills and relationships as criteria that can be demonstrated by individuals currently in the business unit.
Require each business unit to submit their criteria to HR for review.
eview each business unit’s criteria to ensure business unit leaders are consistently effective at identifying new relationships and that new cross-divisional
R
relationships are mutually acknowledged between groups.
2. Lead a HIPO Talent Calibration
etermine a time for each business unit to hold a HIPO talent calibration. For organizations that currently do not hold a talent calibration, these meetings
D
should occur regularly (one to four times per year).
or each calibration meeting, bring together the senior leaders from the business unit, the HRBP of the unit, and all managers of eligible candidates.
F
Candidates should be at a middle-management level or higher; HIPO pools can be tiered for different levels within the unit.
Review each candidate to determine their talent designation.
ssess each candidate based on current performance, potential to perform at a higher level, and demonstration of the relationship requirements
A
for the business units.
se qualitative feedback from performance reviews, anecdotes from managers, and comments from others in the room to assess each candidate.
U
Allow time for individuals to ask questions or provide supplemental evidence for each candidate.
Based on the evidence available, assign each candidate a talent designation:
HIPOs—Demonstrate high performance, potential, and the identified relationship requirements
High Performers—Demonstrate high performance and potential alone
General Performers—Demonstrate moderate performance, potential, and some relationship requirements
Tip: For additional guidance on identifying and developing HIPO talent, please refer to our High-Potential Talent Topic Center.
3. Differentiate Development for Each Talent Segment
Define development programs for each of the three talent segments:

HIPO development should prepare these employees for the next role they will be promoted into.
HIPER development should build networking skills that will help this group recognize and build emerging relationships in their current role.
General Performer development should build skills for talent to succeed and build relationships within their current role.
Require managers of HIPER talent to report their development progress to HR.
For talent who are quickly building relationship requirements, reassess their eligibility for HIPO status during the next talent calibration.
Appendix 123
S: ENTERPRISE LEADERSHIP PREDICTORS: IMPLEMENTATION Q&A
■■ What is the greatest barrier we should anticipate when implementing this ■■ How can we ensure leaders identify the most critical future relationships?
practice? HRBPs should actively participate in defining relationship requirements
Some leaders will struggle to connect emerging skills with changing for their business units and push leaders to consider the importance of
relationship requirements for future leaders. Before leaders participate in any possible emerging relationships before designating them relationship
needs assessment, bring HRBPs from different business units together to requirements. In addition, each business unit should submit its relationship
share what critical skills are prevalent within their business unit and the requirements to HR to ensure emerging relationships are mutually
biggest talent changes the unit has faced in the past two years. The HRBPs acknowledged between business units and functions.
can then support their leaders with knowledge about the skills in other units
as leaders consider what new partnerships might be emerging for their unit
■■ Can we integrate future performance into our current definition
as the business changes. of “potential”?
NBK plans to integrate future performance into the “potential” definition
■■ Is this practice worthwhile if we do not use a 9-box grid and to identify once leaders are comfortable and consistent in recognizing how network
HIPOs? performance is critical to a HIPO’s success as a leader. If your leaders are
Ensuring that all leaders can recognize the differences between present already proficient at recognizing network performance in their current
and future leadership success is critical for any organization. Even if an employee population, future performance criteria should be integrated
organization does not use a 9-box grid specifically, organizations still have into the definition of potential.
an opportunity to consciously define relationship and skill requirements for
future leaders. Organizations should also ensure candidates are reviewed
■■ Is this practice applicable for emerging leadership roles?
against these relationship requirements before being designated HIPO, Yes. As leaders identify emerging roles within their business unit, they should
regardless of whether the organization uses a 9-box. define not only the skills needed for these roles, but also the relationship
requirements for the role. This will ensure that any individual who assumes
■■ How do we ensure leaders do not designate HIPO status to a candidate the new position will have an understanding of the partnerships required
who should be a high performer? to be successful in the role.
HR should communicate to leaders that designation as a high performer
does not mean that a candidate is unsuitable for a leadership position,
but rather that a gap in network performance must be addressed before
the individual is eligible to move to the next level. At NBK, managers
communicate their employees’ status and what the employee can expect
from development during the year following calibration.
Appendix 124
S: ENTERPRISE LEADERSHIP PREDICTORS: TALENT
SEGMENTATION CUBE
NBK’s Talent Segmentation Cube Merges Placement on the 9-Box with Future Performance Criteria
To visually represent the third filter of Future Performance, Deputy Head of HR Fred Carstens and Head of HR Emad Al Ablani
designed the NBK Talent Cube to sit alongside the 9-box.
ots)
(HiP
tial
o ten
High P
3
6 3 1 1 5
2
Potential
8 5 2 1 5
4
9 7 4 2
7
Hi
gh rfs)
Performance (Enterprise Contribution) Pe Pe
rfo r(
rme rme
fo
r(
Hi er
Pe ralP
rfs) ne
HiPots: Demonstrate High Performance, Potential, and Future Performance Ge
HiPerfs: Demonstrate High Performance and Potential
Perfs: Demonstrate Moderate Performance and Potential
Appendix 125
S: E
NTERPRISE LEADERSHIP PREDICTORS: TALENT SEGMENTATION
TRANSPARENCY GUIDE
Do your ground work so that you are well prepared with critical information that addresses the concerns or questions that
employees may raise during talent conversations. The checklist below can help with the preparation.
BK criteria for HiPots, HiPerfs, and Perfs: Ensure you can answer specific questions regarding the definition and classification
N
criteria for HiPots and HiPerfs.
–– HiPots are enterprise contributors.
–– HiPerfs are individual contributors.
ritical behavior factors: Be prepared to provide evidence or concrete examples of specific behaviors classify talent as HiPots
C
or HiPerfs.
vailable next steps: Be prepared to discuss opportunities to help talent grow or bridge critical gaps of potential derailing
A
behaviors. These could be:
–– Development interventions through coaching,
–– Networking with peers or others to learn and develop new skills, or
–– Formal development using the NBK training curriculum.
Appendix 126
To achieve strong growth, The
LEGO Group’s leaders reorient
T: RELATIONSHIP-BASED ROLE CHARTERS
their job roles based on their
relationships with key “co- Role Charters Provide the Foundation for Reorienting Leaders’ Job Roles
producers,” 1 rather than just The LEGO Group’s Role Charter Template
their tasks and accountabilities.
To help leaders rethink their roles

based on relationships, The LEGO
Group: Name:
■■ Frees leaders to self-assess Position:

1
their value, Purpose:
Free leaders to
■■ Drives for mutually beneficial self-assess their
1. Accountabilities: What will I uniquely do? (This is not a list of responsibilities.)
relationships, and unique value to the
organization. Continued Accountabilities New Accountabilities
■■ Emphasizes behaviors. (What I will continue to focus on/develop) (What is a new focus for me?)
The role charter template2 is key

■■ What will I uniquely contribute that nobody ■■ What accountabilities would I take on if I was
else will? just hired?
to The LEGO Group’s leaders ■■ What will I continue to focus on/develop? ■■ What will I uniquely contribute that is new?
effectively reconsidering their job 2 ■■ What will I no longer focus on/develop? ■■ What have I not focused on before that I will
roles to better support growth. Drive for win- focus on in this new role?
win relationships
by negotiating 2. Shared Accountabilities and Collaboration Areas
accountabilities
Key Player 1 Key Player 2 Key Player 3
and decision rights.
■■ For which accountabilities ■■ For which accountabilities ■■ For which accountabilities
must I collaborate? must I collaborate? must I collaborate?
■■ Who do I need to collaborate ■■ Who do I need to collaborate ■■ Who do I need to collaborate
with? with? with?
■■ What role does each person ■■ What role does each person ■■ What role does each person
3
play? play? play?
Emphasize
behaviors to drive 3. My Leadership Behavior
relationship quality. ■■ How will I act as a leader?
■■ What am I going to change?
■■ What do I need to focus on?
4. What are the 3–5 most important parameters on which I will be measured?
Source: The LEGO Group; CEB analysis.
1
“Co-producers” refers to peers with whom a leader shares accountabilities for objectives or initiatives.
2
Role charters were originally developed by Boston Consulting Group.
Appendix 127
U: INTERACTIVE ENTERPRISE LEADERSHIP
EVALUATION
OVERVIEW
Many organizations struggle to accurately evaluate leader performance through their current performance management
processes. Crombie REIT realized it needed to take a more interactive, dialogue-based approach to evaluating leader
performance to identify and reward contributions that might otherwise be overlooked.
SOLUTION HIGHLIGHTS
■■ Identify Contribution Opportunities

Rather than create additional or shared MBOs, leaders meet with their peers during the objective-setting process
to discuss their individual objectives and identify opportunities to contribute to one another.
■■ Evaluate Peer Contributions
Leaders’ managers conduct qualitative interviews with them to assess the value of their contributions throughout
the organization. Leaders hold roundtables to evaluate the way their team is contributing to other business units and
functions.
■■ Uncover Organizational Barriers to Performance
HR aggregates performance data from the organization to identify organizational barriers to performance and ensure
that the talent strategy aligns with corporate strategy.
COMPANY SNAPSHOT
Crombie REIT
Industry: Real Estate Crombie REIT is a real estate investment trust that owns, manages,
Investment Trust and operates a diverse portfolio of commercial real estate, with a primary
2013 Revenue: US$277.3 Million holding of grocery and drug store retail properties. Crombie is a national
2013 Employees: Less Than 1,000 landlord, with 249 properties totaling over 17.6 million square feet and total
assets of US$4 billion.
Key Region Canada
of Operation:
Appendix 128
Recognizing that common
approaches to identify high-
U: CROMBIE’S DIALOGUE-BASED ENTERPRISE
performing leaders often fail,
Crombie rethought the way
LEADERSHIP EVALUATION
it evaluated leadership.
Crombie’s Performance Review Process
Crombie’s dialogue-based
approach uncovers the less-
obvious aspects of leader
performance that traditional
performance management
processes fail to detect. The
graphic on this page provides 1 2 3
a high-level overview of the Identify Uncover and Evaluate
performance review’s structure Contribution Evaluate Individual Organizational
and content. Opportunities and Team Barriers to
Contributions Performance
Leader performance at
the individual, team, and
organizational levels is
reviewed through dialogues
to ensure leader performance
is accurately measured and JANUARY FEBRUARY APRIL
rewarded.
2014 Enterprise
Leadership
Action Plan
Key Takeaways
Contribution
Identification
Discussion
Leader and Team

Contribution Evaluations
Source: Crombie REIT; CEB analysis.
PRACTICE OVERVIEW COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
Appendix 129
Rather than setting shared
MBOs or creating separate
U: IDENTIFY CONTRIBUTION OPPORTUNITIES
collaboration goals, leaders
discuss their individual
THROUGH PEER DISCUSSIONS OF INDIVIDUAL OBJECTIVES
objectives with peers to identify
contribution opportunities. Peers Discuss Objectives and Identify Contribution Opportunities
Crombie first clarifies
expectations for productive
contribution through dynamic, Sara, VP HR Joe, VP, Operations
Leaders Meet with
personal leader success stories 2014 Objectives 2014 Objectives
Peers to Discuss
in quarterly check-in calls and
Their Objectives 1. Reduce compensation costs affecting 1. Reduce overhead expenses.
interactive leader town halls.1 overhead expenses.
2. Create regional consistency and more
Senior leaders at Crombie also 2. Make business processes more effective, effective business processes.
seek out colleagues to discuss strengthen communication, and increase
3. Improve operations function’s engagement
their objectives for the year and productivity.
scores.
determine the contributions 3. Strengthen engagement and improve
they will make to each other’s company-wide engagement scores.
work.
Leaders Identify
Opportunities to Contribution Opportunity Identified
Contribution Opportunity Identified
Contribute to Each HR will partner with Operations in
Operations will partner with HR
Other’s Objectives identifying appropriate short- and
to reduce overhead costs.
long-term engagement strategies.
Sara, VP HR Joe, VP, Operations
Tips for Large Organizations Leader Contribution Discussion

■■ Leaders can work with their Source: Crombie REIT; CEB analysis.
managers to identify and

prioritize contributions.
See Implementation Guide for more information about how Crombie clarifies contribution expectations.
HR can provide tools and
1
■■
guidance to help leaders

identify peers to contribute to.
Appendix 130
Crombie assesses leader
performance through peer
U: EVALUATE LEADERS’ INDIVIDUAL CONTRIBUTIONS
interviews to identify high
performers. This way, managers
THROUGH IN-DEPTH PEER INTERVIEWS
are able to probe deeper, ask
follow-up questions, and ensure Hold Annual Peer Interviews to Provide Manager Conduct Calibration Discussions to Verify
high-quality feedback. Visibility into Leaders’ Contributions Productive Contributions
To quantify the feedback, peers

also rate leaders on a scale of How did Joe’s contributions affect your performance;
1–10. Ratings are calibrated so what were the outcomes?
performance awards reflect
productive contributions, not Sara’s Joe’s
just collaborative behavior Manager Manager
Joe’s Manager Sara, VP HR
or business results. Crombie
reviews the calibrated ratings
Source: Crombie REIT; CEB analysis. Performance
to identify and discuss any Reviews
discrepancies in the data,
including:
■■ Wide variation or too much

consistency,
■■ Discrepancies in ratings Joe’s Compensation Breakdown
and interview results, Illustrative
■■ Misalignment between peer
Employee Eligible for Awarda: Joe D.
and manager feedback, or
Job Level: VP
■■ Significant fluctuations Award Eligibility: 30% of Base Pay The extent to which
year–over–year. leaders contribute to
Performance Award Financial Goals
Considerations b and use contributions
Operational Goals
from others accounts
Relationship/Customer Goals
for about 50% of the
People and Talent Goals rating in each goal
TOTAL PERFORMANCE AWARD: 27% of Base Pay category.
Ensure Interviews Are Efficient Source: Crombie REIT; CEB analysis.

a
Crombie refers to bonuses or incentives as “awards.”
■■ Embed interviews into b
Weightings for each goal category will vary depending on the role.
existing check-ins and
meetings.
■■ Streamline conversations
using discussion guidelines.
Appendix 131
Using feedback from peer
interviews, leaders facilitate
U: LEADERS EVALUATE THEIR TEAM’S
roundtable discussions
with their teams to assess
CONTRIBUTIONS THROUGH ROUNDTABLE DISCUSSIONS
contributions to and from the
team as well as barriers to team Crombie’s Team Roundtable Agenda
performance. Illustrative
Leaders work with their

teams to create action
Operations Function Roundtable Agenda
plans to improve the team’s
contributions and determine Objective: Evaluate how the team is working
where contributions from with Leasing and IT functions.
other teams are needed. They Team Roundtable Participants:
will also review roundtable All team members in function Benefits of Team Roundtable Discussions
feedback with their peers to
Items for Discussion
determine how their teams can ■■ Team-level analysis identifies barriers to
better work together. Team Contribution Feedback team performance that are not typically
■■ Review of performance feedback from
uncovered in individual reviews.
other teams and functions
■■ Diverse team perspectives give leaders a
Contributions from Other Teams
■■ Did the team use contributions from other
complete picture of the team’s interactions
with other groups.
teams?
■■ Were these contributions productive?
Action Items
Review of contribution opportunities for
■■
next quarter
Joe, VP, Operations,

Team Roundtable
Facilitator
Ensure Productive Roundtables

■■ Communicate clear
objectives.
■■ Set parameters for what will
and will not be discussed.
■■ Provide agenda ahead of
meeting so team members
have a clear sense of their
roles.
Appendix 132
Crombie uses team roundtable
and leader assessment
U: LEADER AND TEAM EVALUATIONS IDENTIFY
feedback to get a broader
understanding of the
ORGANIZATION-WIDE BARRIERS TO PERFORMANCE
organizational barriers to leader
performance. Crombie’s Evaluation Informs Executive Action Planning for the Next Year
On the business end, HRBPs
meet with line leaders Crombie’s Enterprise Leadership Evaluation
regularly to contextualize the Function Average Leader Variation Year-Over- Team Roundtable Potential Implications
organizational barriers to leader Contribution Year Change Feedback for Corporate Strategy
performance. Rating
At the functional level, HR The operations team Slows operations

collects, aggregates, and Operations 6.5 0.6 (1) must prioritize improving processes
analyzes performance data to knowledge transfer.
identify organizational—not just The HR team needs Gaps in critical talent
individual—barriers to leader to clarify deadlines and pools throughout the
HR 8.9 5.1 +4
performance. The executive improve cross-functional organization
team uses evaluation results communication.
to determine action plans to
remove barriers and better
enable Enterprise Leadership The HR team needs to Redundancies are
over the next year. The HR team needs to Redundancies are
clarify deadlines and preventing the
Organization clarify deadlines and preventing the
8.7 1.5
.5 +2 improve cross-functional organization from reaching
Total improve cross-functional organization from
communication. its leasing goals.
communication… reaching its leasing goals…
Key Data for Review How HR Uses the Data

Function-Specific Scores Indicate the average leader rating at a functional level to better
understand where future efforts should be targeted.
Variations in Ratings Across Functions Helps HR determine whether action steps should be applied
organization-wide, or in specific functions
Trends Over Time Ensure that leaders continue to meet organizational standards.
Themes in Roundtable Feedback Helps to validate and provide more context for leader contribution
ratings and inform future action plans
Appendix 133
Crombie’s Enterprise
Leadership Evaluation has
U: CROMBIE’S ENTERPRISE LEADERSHIP
not only increased its ability
to achieve goals at the
EVALUATION IMPROVES EMPLOYEE ENGAGEMENT
organizational level, but also
improved how leadership Percentage of Employees Who Are Engaged Percentage of Employees Rating Senior
at Crombie is perceived by 2013 Leadership Highly
employees. 2013
To determine the success of 1.15x

its practice, Crombie measures 1.12x
employees’ perceptions 1.00x 1.00x
of senior leaders within
the organization in their
engagement survey. Employees
are more engaged when they
believe the senior executive
team is committed to them.
Peer Benchmark Crombie REIT Peer Benchmark Crombie REIT
Source: Crombie REIT; CEB analysis. Source: Crombie REIT; CEB analysis.
Percentage of Employees Who Agree That

Senior Leadership Acts in Accordance with
Organizational Values
2013
“Crombie is a great place to work;
the company values its employees, and
1.11x
1.00x
coworkers go above and beyond to help
you get work done. ”
Crombie REIT Leader
Peer Benchmark Crombie REIT

Appendix 134
CEB Implementation Guide
Interactive Enterprise Leadership
Evaluation |
Contextualizing This Practice for Your Organization’s Needs
and Resources
■■ Implementation Checklist
■■ Implementation Q&A
■■ Additional Resources
Appendix 135
U: INTERACTIVE ENTERPRISE LEADERSHIP EVALUATION: IMPLEMENTATION
CHECKLIST
1. Support Identification of Peer Leader Contributions
efore managers set individual objectives for leaders for the year, meet with the HRBPs to determine the best method to support both leaders and their
B
managers.
Provide HRBPs with guidance to help managers determine which leaders should share individual objectives.
ncourage HRBPs to meet with the leaders’ managers before objective setting to get an idea of what leaders will be working on throughout the year and
E
what types of contributions might be expected.
Tip: For organizations where relationships between leaders are strained or limited, consider having HRBPs moderate objective conversations between
leaders.
Require HRBPs to meet with leaders and their managers after objective setting to record contribution goals for the year.
2. Guide Managers in Assessment of Leader Contributions
Train managers to provide guidance on leading an interactive performance evaluation.

Remind managers what commitments their report made to peers at the beginning of the year.
Provide guidance on leading efficient interviews.
Collect the results of calibration discussions to examine trends across leaders and business units.
3. Empower Leaders to Surface Barriers to Team Performance
Train leaders to understand how to lead a productive roundtable.

Tip: For guidance on how to train others to conduct employee focus groups, please visit the CEB Corporate Leadership Council™ web portal.
Support HRBPs as they guide leaders through team roundtable discussions.
Build sample agendas to ensure productive roundtables.
Offer to review leaders’ action plans to ensure that they are effectively addressing their teams’ challenges.
Tip: Consider assigning HRBPs to moderate specific team roundtable discussions if the team is particularly large or difficult to manage, or if other factors
would make it challenging for the leader to easily identify barriers to performance.
Encourage leaders’ managers to collect action plans from their leaders and consider incorporating some of the findings into leader individual objectives.
Appendix 136
: INTERACTIVE ENTERPRISE LEADERSHIP EVALUATION: IMPLEMENTATION
U
CHECKLIST (CONTINUED)
4. Identify and Manage Organization-Wide Barriers to Performance
Collect performance data from completed individual assessments and team roundtables.
Consider housing information on an internal platform that can be easily reviewed and filtered by senior leadership throughout the organization, not just HR.
Consolidate findings and draft key themes into a report.
Organize information by business unit, geography, or function so findings can be easily read and understood.
Prioritize findings by business criticality to ensure these issues are considered when thinking about goals for the coming year.
Present the report to the executive team to use during the annual business strategic review.
Tip: Consider including unexpected findings in the presentation for further discussion.
Refer to consolidated data when building a talent plan for the coming year.
Choose two to four targeted areas for focused improvement.
Identify parts of the business that are particularly successful and draw best practices from these areas to share with other business units.
Regularly review scoring process with leaders to ensure scores accurately represent the realities of different teams.
Appendix 137
U: INTERACTIVE ENTERPRISE LEADERSHIP EVALUATION:
IMPLEMENTATION Q&A
■■ What is the greatest barrier we should anticipate when implementing this ■■ How can we take this approach without significantly increasing the amount
practice? of time needed for performance reviews?
Some leaders and their managers will be hesitant to participate in interactive Organizations can reduce the time needed to hold interviews with peer
performance evaluations because they are not as straightforward as leaders by incorporating them into existing meetings between leaders and
conventional performance evaluations. HR can alleviate these concerns their managers. Organizations should also consider creating and sending
by communicating the benefits of interactive performance evaluations discussion guides for managers beforehand so that leaders know exactly
(e.g., greater variety in contributions assessed, better understanding of the what topics will be discussed.
key drivers of team performance) and providing training on how to lead a ■■ How do we implement team roundtables if our leaders manage large,
productive interactive evaluation.
inconsistent, or geographically dispersed teams?
■■ How do we implement this practice if we are a large or decentralized Leaders who manage large teams should consider gathering written
organization? feedback from individuals prior to the roundtable and discussing the themes
Organizations may choose to implement this practice at different levels that have arisen from the feedback. This type of system would also work
within the organization. For decentralized organizations, consider well for leaders who manage inconsistent or diverse teams. Leaders can
implementing this practice at the business unit level instead of at the also choose to hold several small roundtables instead of one single, large
organizational level. Organizations may also choose to select a few levels roundtable.
in the organization where this practice would be the most beneficial (e.g., ■■ How can we get the greatest value out of the information collected during
general managers, vice presidents).
executive action planning?
■■ What is the best way to determine which leaders should discuss their Organizations should review trends at business unit and organizational
individual objectives with each other? levels to identify the greatest areas for improvement. Organizations should
HR should consider establishing general criteria for leaders and managers also consider synthesizing the information collected and embedding it
to determine which peers to discuss objectives with, and HRBPs should be into the information evaluated during the annual strategic business review.
deployed to guide managers through the process of selecting peer leaders. Organizations should also consider incorporating the highest-level trends
Organizations should consider where leaders’ work has the greatest influence into company-wide communications to increase organizational awareness
on other areas of the organization, and pair those leaders to discuss of these challenges.
individual objectives. Organizations should also consider partnering leaders
if a relationship does not currently exist but would be organizationally
beneficial. Leaders do not need to be limited to discussing objectives with
peers at their level in the organization; in fact, they should be encouraged
to consider the broader group of leaders at the organization whose teams
affect their own team’s performance.
Appendix 138
Crombie clarifies expectations
for productive contribution
U: DEMONSTRATE PRODUCTIVE CONTRIBUTIONS
through dynamic, personal
leader success stories in
THROUGH LEADER NARRATIVES
quarterly check-in calls and
interactive leader town halls. Crombie Showcases Enterprise Leadership Success Stories in
Executive Road Shows and Leader Town Halls
Executive leaders at Crombie
reinforce the importance of
Enterprise Leadership in an
executive road show, or series
of town halls, where they share
their own narratives. Leaders
also share personal examples Key Components of a Leader Narrative
during quarterly check-ins,
hares examples of potential
S
engagement meetings, and
contributions and success stories
leadership and team meetings
throughout the year to reiterate Answers questions posed by the group
contribution expectations. Canada
eeks advice on opportunities for
S
Employees use these interactive contribution
sessions to ask questions
and brainstorm examples larifies strategy and performance
C
of contributions. expectations
Note: HR is a leader and also preps the

CEO, CTO, EVP CFO,
engagement approach.
EVP Operations
Engagement Meetings
Appendix 139
V: SPAN OF INFLUENCE MAPPING
DESCRIPTION
Becton, Dickinson and Company (BD) defines subsegments of the organization, called organizational performance units
(OPUs), to measure organizational performance at various levels in the company. The company then maps executive
spans of control and influence to the appropriate OPUs, which BD uses to fund executive incentives.
KEY PRACTICE LESSON
Organizations should design compensation strategies to account for executives’ influence over organizational outcomes,
and should recognize limits to their spans of control and influence to ensure they are compensated for outcomes they
can meaningfully affect.
COMPANY SNAPSHOT
Becton, Dickinson and Company

Industry: Medical Equipment BD manufactures and sells a broad range of medical supplies,
2012 Sales: US$7.7 Billion devices, laboratory equipment, and diagnostic products.
2012 Employees: 30,000

Headquarters: Franklin Lakes, NJ;
operations in over
50 countries
Appendix 140
BD senior leadership begins the
process of span of influence
V: CATEGORIZE EXECUTIVES BY TYPE
mapping by categorizing
executives into six groups, each Executive Categorization Design Session
with a distinct span of control
and influence over operations. Worldwide Business
Goals of Executive Categorization
Segment Leaders
1. Treat comparable executive roles consistently.
2. Maintain simplicity by minimizing number of categories.
VP of 3. Categorize by size and scope of role.
HR 4. Categorize by effect on operations and performance.
5. Align categories to existing organizational structure.
Director of
CEO CFO Worldwide
Compensation
BD’s Six Categories of Executives
1 Country Business Unit 2 Regional Business Unit 3 Worldwide Business Unit

Executive Executive Executive
Operates a $30 million–$100 million Operates a $100 million–$400 Operates a $300 million–$1 billion
business million business business
4 Country Shared Services 5 Regional Shared Services 6 Corporate Executive

Executive Executive
■■ $20 million–$50 million budget $100 million–$300 million budget ■■ Responsible for businesses
■■ Also includes country general or budgets of $500 million
managers and higher
■■ Also includes regional general
managers and worldwide shared
services executives
BD categorizes executives by A category may include multiple

geographic span and whether they executive roles with similar spans
are part of a business unit or a shared of control and influence over BD’s
service. operations.

Note: Executive examples are illustrative only.
COMPONENT 1 COMPONENT 2 COMPONENT 3 COMPONENT 4
Appendix 141
BD defines a set of activities
that constitute executive
V: DEFINING EXECUTIVE SPANS OF INFLUENCE
influence and applies them
to each of the six executive Span of Influence Analysis
categories to map executive
influence to the appropriate Discussion Guide: Span of Influence
Adopting a more global, integrated view of operations Analysis
OPUs.
performed
■■ Partner with other organizations to pursue innovation in new
1 for each
markets or products. Country
of the six
■■ Work across organizational boundaries to increase operational Business Unit
executive
Executive
effectiveness. categories
Category
Contributing insight, best practices, or relationships
■■ Help other businesses use existing customer or vendor
Business
relationships. Unit Leaders
■■ Share best practices in manufacturing, sales, or other functions.
Director of
■■ Assist other organizations in acclimating to cultural and
Worldwide VP of
business norms of the country and region. Compensation HR
Limits to the span of influence
■■ What are the geographies these executives cannot influence?
■■ What are the business lines these executives cannot influence?

Business Unit HR
Leaders
Country Business Unit Executive Span of Influence Map

OPUs Defined
BD defines OPUs as sub- Span of Business Segment 1 Business Segment 2 Country Business Unit Executive
segments of the organization Influence
BU 1 BU 2 BU 3 BU 4 BU 5 BU 6 Span of control is country business unit OPU.
to measure organizational Span of Country
Control Span of Influence: Regional Business Unit OPU
performance at various levels 1
Build executives’ accountability across geographic
Region 1
in the company. OPUs measure Country lines.

BD’s operating income, 2 Example: Executives collaborate with similar
segmented along geography Country businesses in other countries to identify best
3 practices in manufacturing and sourcing.
and business lines. Examples
include: Country
4 Span of Influence: Total Country OPU
Region 2
■■ BD Corporate OPU (total Country Build executives’ accountability across business

operations worldwide), 5 lines.
Country
Example: Executives help other businesses in their
■■ Regional Business Unit country acclimate to the culture and possibly use
6
OPU (specific business unit key customer relationships.
operations in a given region),
and
■■ Total Country OPU (all
operations in a country). COMPONENT 1 COMPONENT 2 COMPONENT 3 COMPONENT 4
Appendix 142
After identifying the OPUs that
define the span of influence for
V: CONNECTING INCENTIVES TO INFLUENCE
each executive category, BD
determines how much of each Span of Influence and Control for Executive Categories
executive’s incentives will be
funded by different OPUs. Executive Category OPU Defined by OPUs Defined by Span of Influence
Span of Control
1. C
ountry Business Country Total Country: Help other businesses acclimate to country culture, use key customer
Unit Executive Business Unit relationships, and achieve operating efficiencies.
Regional Business Unit: Identify best practices in manufacturing and sourcing.
2. R
egional Business Regional Total Region: Help BD take a more integrated approach to the region.
Unit Executive Business Unit Worldwide Business Unit: Share best practices with other regional business units.
3. Worldwide Worldwide BD Corporate: Integrate company’s global operations.

Business Unit Business Unit
Executive
4. C
ountry Shared Total Country Total Region: Drive efficient allocation of shared resources at the regional and country level.
Services Executive
5. R
egional Shared Total Region None: Limited ability to influence operations beyond the region
Services Executive
6. Corporate BD Corporate None: Entire company in span of control
Executive
Determination of Executive Incentive Pool Funding Through OPUs
Up to 50% of incentives are based BD’s six types of OPUs

Decision rules for weighting on OPUs influenced on by the leader.
OPUs for incentives:
Percentage of Bonus Funded by Organizational Performance Unit
■■ An OPU counts toward a
minimum of 25% of executive BD’s Six Executive Categories Country Total Regional Total Region Worldwide BD
incentives or is not counted Business Unit Country Business Unit Business Unit Corporate
at all. 1. Country Business Unit Executive 50% 25% 25%
■■ OPUs that represent an 2. Regional Business Unit Executive 50% 25% 25%
executive’s span of influence 3. Worldwide Business Unit Executive 75% 25%
will each drive 25% of the 4. Country Shared Services Executive 75% 25%
executive’s incentives.
5. Regional Shared Services Executive 100%
■■ The OPUs that represent an 6. Corporate Executive 100%
executive’s span of control
will drive the majority of the Source: Becton Dickinson; CEB analysis.
executive’s incentives (50%,

75%, or 100% of the total). COMPONENT 1 COMPONENT 2 COMPONENT 3 COMPONENT 4
Appendix 143
The performance of relevant
OPUs funds executive
V: FUNDING AND ALLOCATION OF INCENTIVES
incentives, which are adjusted
by senior leaders to ensure that Incentive Funding Example: Country Business Unit Executives
incentive payouts accurately
reflect individual performance
Organizational Performance Target Incentive OPU Performance Performance Preliminary Incentive
differentials.
Performance Unit Weighting Components (Percentage Factor (Funded Amount)
of Target)
Country Business Unit $39,000
50% $30,000 106% 130%
(Span of Control) ($30,000 x 130%)
Regional Business Unit $16,500
25% $15,000 102% 110%
(Span of Influence) ($15,000 x 110%)
Total Country $12,000
25% $15,000 92% 80%
(Span of Influence) ($15,000 x 80%)
Totals 100% $60,000 $67,500
Executive incentives are funded The performance of each OPU relative to its goal translates into
by OPU performance. a performance factor, which is applied to the target incentive
amount for that OPU to build a preliminary incentive total.
Incentive Allocation Example: Country Business Unit Executives
Executives in Business Unit 4, Funded Individual Performance- Adjusted Incentive

Country 6a Incentives Performance Based Adjustment (Actual Payout)
Michael Fallon $67,500 20th Percentile ($35,000) $32,500
Wesley Ng $67,500 90th Percentile $30,000 $97,500
Robert Prata $67,500 40th Percentile ($5,000) $62,500
Kristin Lyons $67,500 75th Percentile $10,000 $77,500
Totals $270,000 $0 $270,000
Because incentive funding depends on organizational—not individual— The region’s senior leader can …but all adjustments
performance, executives at the same level in the same business unit adjust incentives based on must net to zero.
will have incentives funded at the same level, relative to base salary. individual performance ratings…

a
In this example, all executives are assumed to be at the same level in the organization, with identical base salaries. All dollar amounts shown are illustrative only.
COMPONENT 1 COMPONENT 2 COMPONENT 3 COMPONENT 4
Appendix 144

Creating Enterprise Leaders

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Creating Enterprise Leaders

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Creating Enterprise

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INTRODUCTION: CREATING ENTERPRISE LEADERS • 1

CHAPTER I: SHIFT MIND-SETS TO ADAPT TO LACK OF CONTROL • 27

CHAPTER II: INCREASE TRANSPARENCY TO ADDRESS INSUFFICIENT INFORMATION • 43

CHAPTER III: REDESIGN EVALUATIONS TO REDUCE REWARDS RISK • 72

Quantify Enterprise Leadership to make outcomes tangible.

■■ Horizontal Goal Cascade • 78

Personalize objectives to connect contributions with business goals.

■■ Span of Influence Mapping • 79

Clarify the connection between leader contributions and pay.

■■ Cross-Divisional Partnership Review • 80

© 2015 CEB. All rights reserved. HRFR3701715SYN

“The world is faster, more interconnected; I’m worried

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 2

Introduction: Creating Enterprise Leaders 3

Greater Business Portfolio Complexity

Implication: Leaders Must Collaborate with Unfamiliar Peers

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 4

Less Time with Team

Implication: Management Is More Social Now

Introduction: Creating Enterprise Leaders 5

Underpinning these challenges

Leaders Fail to Drive Cross-Team Collaboration

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 6

Classical Leadership Humanistic Leadership Transformational Leadership Enterprise Leadership

© 2015 CEB All Rights Reserved. HRFR3701715SYN_11x17

Introduction: Creating Enterprise Leaders 7

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 8

Using data provided by 423 leaders, we created a network map that

managers. ■■ Leader success profiles

Source: CEB analysis.

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 9

Leadership Survey Head of Function Survey

Introduction: Creating Enterprise Leaders 10

“I relentlessly prioritize what’s best for my team. The

“Our leaders are hitting the

Source: CEB analysis. n = 197.

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 11

Maximum Impact on Business Unit Financial Outcomes

0% “We used to think of leadership as vertical.

Introduction: Creating Enterprise Leaders 12

To test this model of leadership,

■■ Effectively transferring working

Please see the Appendix for

Introduction: Creating Enterprise Leaders 13

Individual Enterprise Individual Enterprise

© 2015 CEB. All rights reserved. HRFR3701715SYN

Introduction: Creating Enterprise Leaders 14

6% The benefit to their own

Impact on Business Unit Net

Introduction: Creating Enterprise Leaders 15

n = 908 (Enterprise Leadership); 2,101 (Enterprise Contribution).

Introduction: Creating Enterprise Leaders 16

Conflicting Strategies Connected Strategies

0% “We used to think of leadership as vertical.