You are on page 1of 6

Definition

Leadership development—broadly defined as formal and informal training


and professional development programs designed for all management and
executive-level employees to assist them in developing the leadership skills
and styles required to deal with a variety of situations.

Source: SHRM HR Glossary of Terms, www.shrm.org

Introduction

“Emotional intelligence is twice as important as cognitive abilities in


predicting outstanding employee performance and accounts for more than
85% of star performance of top leaders.”1

In today’s fast-paced business environment, organizations have high


expectations of their leaders. The ideal leader is flexible, proactive,
possesses strategic thinking and analytical skills, is culturally competent and
adept at competitive positioning. To attain this level of leadership, the
organization must be committed to leadership development. Thus, to define
leadership competencies, develop leadership models and identify high-
potential leaders with the appropriate skills, HR leaders must establish a
strong partnership with the Board, CEO and senior management.

Effective Leadership Development

Effective leadership development encompasses four key areas: 1) the speed


required to forward the development of leadership talent; 2) determining the
most effective leadership methods; 3) wisely investing money and time for
leadership development; and 4) clearly demonstrating the success of
leadership development methods.2

A recent survey of 240 major public and private U.S. companies on effective
leadership development notes that the 20 top companies have formal
leadership programs and 90% have formal leadership competency models. In
addition, these companies integrate their leadership competencies into
processes for selecting, developing and assessing leaders.3

Further, research shows that organizations that approach leadership


development with a process, such as the recommendations outlined below,
are among the most successful and high-performing organizations.4

• Assess leader styles and motives and determine their impact on


climate and performance.
• Create customized, competency-driven leadership models to support
the organization’s strategic goals.

• Focus on and expand the emotional intelligence of their leadership


(e.g., self-awareness, self-management, social awareness, social skills).

• Demonstrate a strong commitment to extensive development and


coaching efforts.

• Measure and reward both leadership development and performance.

Leadership Development Tools

The following list of leadership tools covers a wide range of training options.

• 360-degree feedback.

• Assessment instruments.

• Formal and/or informal mentoring.

• Executive coaching.

• On-the-job experience (e.g., rotational assignments, action learning).

• Off-the-job experience (e.g., community leadership, industry


associations).

• Leadership scorecard.

Not all leadership tools are utilized equally. Assessment instruments, for
example, are underutilized as a leadership development tool in domestic as
well as international organizations. As illustrated in Figure 1, a study on
global leadership reveals that 29% of organizations use assessment
processes to screen emerging leaders.5

Figure 1: Use of Assessment Instruments to Screen Emerging


Leaders
Designing a Leadership Development Scorecard

Measuring the effectiveness of leadership development requires the


consideration of different data. Below are seven types of data that address
satisfaction, application, learning, business impact, return on investment and
various intangibles related to leadership development.6

1) Indicators [show the scope and volume of leadership development].

2) Level of satisfaction [with leadership development activities and


programs].

3) Learning [acquisition of knowledge and leadership skills].

4) Application of leadership skills [e.g., applying knowledge to various


job situations].

5) Business impact [e.g., the consequence of applying knowledge and


new skills].

6) Return on investment [comparison of monetary benefits to program


costs].

7) Intangible benefits [business impact measures not converted into


monetary values; e.g., soft data—working habits, work climate, job
attitudes, initiative].

Data may be obtained through a variety of sources, such as questionnaires,


focus groups, observation (e.g., video recording, audio monitoring), 360-
degree feedback, participant estimate and testing. A combination of sources
is suggested.
Literature and Research

Antecedents and Consequences of Reactions to Developmental 360-Degree


Feedback7

The 360-degree feedback is a developmental tool used to provide


information regarding leadership behavior. This study explored and identified
factors that had an impact on leaders’ reactions to 360-degree feedback and
the relationship of different feedback reactions relative to development
activities and changes in leader behavior. Overall, the study showed that
leaders’ reactions to feedback were related to the degree of change in
ratings over time, rather than to the number of follow-up activities reported.
For example, the study results suggested that leaders who had low ratings
and agreed with others regarding theses ratings were less motivated than
those who had low ratings and over-rated themselves. On the other hand,
the study results also revealed that motivation was not an influence for those
with high ratings and agreement between themselves and others’ ratings. In
general, individuals who had more favorable attitudes regarding the use of
feedback tended to be more motivated to follow the feedback.

Career Anchors of Managers With Global Careers8

Due to the globalization of the marketplace, it has become more important


to understand the career ladders of global leaders. This qualitative study
provides new evidence on career anchors of global leaders. The internal
career approach is now one of the most relevant focuses on career paths.
Typically, global leaders have careers that include international assignments.
The study results suggest that most managers’ career decisions are based
on two or three career anchors, rather than one dominating factor. In this
study, the most typical career anchors were pure challenge and managerial
competence. The study’s key conclusion is the importance of the new
internationalism anchor for global leaders: that is, the majority of
respondents ranked the internationalism anchor as either their major anchor
or among a few major anchors.

The Effects of Leader Moral Development on Ethical Climate and Employee


Attitudes9

This study examined the effect of leader moral development on employee


attitudes and the organization’s ethical climate. The survey results
suggested that the relationship between ethical climate and leader moral
development was affected/moderated by two factors: 1) the age of the
organization; and 2) the extent to which the leader utilized his or her
cognitive moral development (i.e., capacity for ethical reasoning). That is,
the leader’s moral development had a greater influence for those leaders
whose moral actions were consistent with their moral reasoning. Further, the
influence of the leader moral development was greater in younger
organizations. As predicted, the connection between the employee’s moral
development and the leader’s moral development was positively associated
with job satisfaction and organizational commitment and negatively
associated with turnover intentions.

In Closing

As part of talent management, the literature highlights the importance of


commitment to effective leadership development by the organization, from
the CEO and the Board level downward. As with all change efforts, leadership
development requires thoughtful planning and implementation. Integration
of leadership development with other key processes—such as recruitment,
selection, training and succession planning—is essential for successful
leadership development.

Online Resources

Center for Creative Leadership: www.ccl.org

Corporate Leadership Council: www.corporateleadershipcouncil.com

Council of Talent Management Executives: www.conference-board.org

Briefly Stated Series: Executive Coaching: www.shrm.org/briefly

Briefly Stated Series: Leadership Styles: www.shrm.org/briefly

Briefly Stated Series: Management: www.shrm.org/briefly

Briefly Stated Series: Mentoring: www.shrm.org/briefly

Briefly Stated Series: Performance Management: www.shrm.org/briefly

Endnotes
1
Hay Group. (1999). What makes great leaders: Rethinking the route to
effective leadership. Retrieved June 10, 2005, from www.haygroup.com.
2
Phillips, J. J., & Schmidt, L. (2004). The leadership scorecard. Burlington, MA:
Elsevier Butterworth-Heinemann.
3
Hewitt Associates. (2002). How companies grow great leaders. Retrieved
June 13, 2005, from www.hewitt.com.
4
Hay Group. (1999). What makes great leaders: Rethinking the route to
effective leadership. Retrieved June 10, 2005, from www.haygroup.com.
5
Collison, J. (2002). Global leadership survey. Alexandria, VA: Society for
Human Resource Management.
6
Phillips, J. J., & Schmidt, L. (2004). The leadership scorecard. Burlington, MA:
Elsevier Butterworth-Heinemann.
7
Atwater, L. E., & Brett, J. F. (2005, June). Antecedents and consequences of
reactions to developmental 360 degree feedback. Journal of Vocational
Behavior, 66, 3, 532+.
8
Suutari, V., & Taka, M. (2004). Career anchors of managers with global
careers. The Journal of Management Development, 23, 9, 833+.
9
Schminke, M., Ambrose, M. L., & Neubaum, D. O. (2005, July). The effect of
leader moral development on ethical climate and employee attitudes.
Organizational Behavior and Human Decision Processes, 97, 2, 135+.

Also in the Talent Management series:

Part I: Talent Management—Overview

Part III: Employee Engagement