DIFFERENT POLICIES CONCERNING EFFICIENCY, DELEGATION, AND

DEVELOPMENT OF LEADERSHIP

Business Efficiency
When a business operates inefficiently, it can end up absorbing an incredible
amount of revenue each year. By understanding business efficiency and the
strategies for improving it, you can help your organization waste less effort
and time, allowing it to run much more smoothly. In this article, we explain
what exactly business efficiency is, explore the most common types of
business efficiency and describe how you can improve the efficiency of your
organization.

Business efficiency refers to how much a company or organization can

produce as it relates to the amount of time, money and resources needed. In
other words, a business's efficiency measures how well it can transform things
like materials, labor and capital into services and products that produce
revenue.

Types of business efficiency

A business's efficiency can be measured in several different ways, such as:

Return on investment

An investment is usually considered any current cost that should help the
company save or make money in the future. Sometimes referred to as an ROI
or net present value, a return on investment could diminish a business's
current efficiency but boost its efficiency in the future.

Process efficiency

Process efficiency measures certain business processes to ensure that they

are effective and efficient. For example, you might examine the cost and
speed of shipping a product to determine if there are ways you could improve
the cost to income ratio.

Operational efficiency

A business's operations are the processes that are integral to the overall
business model. Business operations are typically responsible for a majority
of the company's costs, which is why most efforts to improve efficiency are
focused on this aspect of the business.

Eco-efficiency
 When analyzing a business's eco-efficiency, you must calculate the
comprehensive impact that it has on the environment. For example, you might
calculate the environmental cost as a percentage of the company's income.

Energy efficiency

Energy-efficient businesses can develop sustainable practices that allow them

to reduce costs. To measure this type of efficiency, you would evaluate the
amount of energy needed to operate all areas of the business. You could, for
instance, analyze the energy used during every stage of a product's lifecycle.

Labor productivity

You can measure a company's labor productivity by assessing how much

employees are able to accomplish or produce during an average hour at work.
This type of efficiency is heavily impacted by the equipment, automation and
technological tools that employees have access to.

Financial efficiency

A business's financial efficiency is measured by determining what percentage

of the company's revenue is spent on expenses.

How to improve business efficiency

Here are some steps you can take to effectively boost the efficiency of the
business you work for:

The art of delegation

Delegating isn't always easy. But if you have any reservations about delegating certain projects, consider the
downside of not sharing your workload. When you try to handle too many tasks on your own, you risk:

 burnout and producing poorer quality work.

 you may also hold a staff member's career back by not providing enough challenging assignments for him
or her to develop the skills necessary to move to the next level. 
 you may also reduce motivation through controlling micro management and not trusting your staff.
It is good leadership practice to support and develop staff, this can only happen through by building their
confidence and competence in their ability through supportive delegation.

 Determine what to delegate.  Be specific, identify and list responsibilities that need to be assigned to
others. The better the clarity of what needs to be accomplished, the more likely you'll communicate the
project clearly to your co-worker or employee.
 Match projects to staff members.  Determine which assignments would be best suited to each
employee. This requires a solid understanding of the skills and knowledge of your staff or co-workers. Try
to match responsibilities to each person's strengths. It's also a good idea to offer individuals projects you
know they will enjoy — they will be more enthusiastic about taking on the assignment if it's something
they love to do or want to learn more about.
 Follow up. Successful delegation doesn't end after assigning the project. You need to occasionally check
on the individual's progress to find out if they need additional assistance or guidance.  Remember: your
role is to help remove any obstacles from the person's path, but you still need to trust them to complete
 the task you've assigned. In other words, it's important that you 'delegate authority' to the person and
allow them to fully manage the project and make any decisions required.
 Show appreciation. Knowing how to thank someone for a job well done is just as important as selecting
the right assignments for each person. A heartfelt 'thank you' can go a long way toward motivating that
individual.
The most successful leaders are those who understand their staff and know how to motivate them through
trust and personal development.

Leadership

Broadly stated, leadership is a social process that involves influencing others. The systematic
development of good leaders is fundamental to long-term organizational success, yet
organizations often overlook it or undertake leadership development in a haphazard fashion.

Building a Leadership Development Strategy

Leaders deal with rapid changes brought about by new technologies, globalization, politics,
environmental concerns and war, transforming the basic values, beliefs and attitudes of followers
to build organizational capacity for positive change.

SHRM research indicates that both HR professionals and executives view leadership development
as a major human capital challenge now and in the foreseeable future. In addition, executives
would like to see stronger leadership qualities among the ranks of HR professionals
themselves. SeeSHRM Research Overview: Leadership Development.

Leadership development encompasses formal and informal training and professional development
programs designed to assist employees in developing leadership skills.

Approaches and Elements to Leadership Development

The overarching goal of leadership development is to enhance the capacity for individuals to be

effective in leadership roles and processes. For leadership development initiatives to be truly
effective, they should align with an organization's corporate strategy and offer development
opportunities that are tailored to the individual employee.

Identification of potential leaders

Today's dynamic work environments place a premium on making sure there is a robust leadership
pipeline for the future. Identifying and selecting the best potential leaders are, therefore, critical
strategic objectives for ensuring a sustainable, competitive organization.

Organizations often struggle with identifying potential leaders to select for further development. Do
they base their assessments on current performance, resume and pedigree, raw intelligence, drive
and determination, ethical attributes, popularity, diversity goals, or 360-degree feedback? One
method is the use of a 9-box grid that evaluates an employee's current and potential level of
contribution to the organization.

Employers need to watch out for unconscious bias when selecting employees for leadership
development and promotion. Employees with significant potential may fall under the radar because
they are much younger than the typical high-potential worker; may have been with the organization
for a relatively short time; are in a job that gives them few opportunities to shine; or don't "look the
part" because of factors like appearance, personality or communication style. Such hidden bias
has been blamed for a largely male presence at the nation's top technology companies. See3
Steps for Addressing Unconscious Bias at Work.

The most common misidentification of future leaders results from confusing high management
performance with high leadership potential. An individual who is smart, driven and accustomed to
pushing through obstacles to meet ambitious goals may, for example, lack necessary emotional
intelligence for effective leadership. Alternatively, strong leaders can be found at all levels within
an organization, not just among managers.

Techniques

Once an organization is committed to the goal of leadership development, numerous tools and
techniques are available to accomplish that goal; however, the process may be handled differently
depending on the size and type of the organization (e.g., nonprofit, family business, private
company, public company, government entity and specific industry). The growing use of self-
managed and supervisor- or peer-supported development will necessitate a mind shift to greater
responsibility for participants and related stakeholders.

Assessment instruments

A number of popular paper-and-pencil and Internet-based personality assessments are often used
in developing candidates for leadership positions and for analyzing leadership styles and their
impact on climate and performance. Employers can identify leadership traits by using current
research and personality testing, such as the Strength Deployment Inventory (SDI) or the Myers-
Briggs Type Indicator (MBTI). Assessment centers provide a comprehensive approach to
assessment and may include an array of simulation activities to assess performance on a number
of criteria. SeeSHRM Talent Assessment Center.

Multirater (360-degree) feedback

Multirater feedback—also known as 360-degree feedback—involves measurement of a person's

leadership performance and abilities from the perspective of relevant viewpoints, including self,
subordinates, supervisors and possibly external stakeholders. This feedback can provide
motivation and specific focus to improve leadership skills and performance. See 360 Degree
Feedback: Request for Leadership Behaviors.

Coaching

Executive coaching is often employed in conjunction with assessment instruments. The coaching
process can help individuals understand their assessment data and apply it to real-life situations.
The individual coaching for effectiveness (ICE) model has three parts: diagnosis, coaching, and
periodic contact/review to help maintain learning and modified behaviors. SeeShould Your
Organization Use Internal Coaches? and Executive Coaches Ease Leadership Transitions.

Mentoring

Mentoring is a form of coaching in which a more senior person participates actively in the
professional development of a junior person, usually within the same organization. Mentoring may
be done informally, as is usually the case, but it can also be formalized. SeeViewpoint: How to
Formalize Mentoring.

Leader-to-leader development

Pairing senior executives with leaders who are new to their role or an organization allows for
mentoring that can result in benefits such as knowledge transfer, confidence building and open
collaboration, to name a few. Experienced leaders can help others understand the inner workings
of the leadership team and provide a unique perspective to up and coming leaders in an
organization.
Emotional intelligence development

Emotional intelligence describes the ability of an individual to be sensitive and understanding to

the emotions of others, as well as to manage his or her own emotions and impulses. Ultimately,
executive development is about augmenting a person's emotional intelligence quotient (EQ).
Addressing this task in a group environment is particularly effective because much of emotional
intelligence unfolds within an interpersonal context. Ninety percent of top performers have high
emotional intelligence, according to Travis Bradberry, author of Emotional Intelligence
2.0 (TalentSmart, 2009). SeeEmotional Intelligence Is Key to Outstanding Leadership.

Work experiences, stretch assignments and rotational assignments

One of the best ways to screen for leadership, and to develop leadership abilities, is through the
use of stretch assignments. These may entail reassignment to a different geographical location,
business unit or functional department. In this way, people are coaxed out of their comfort zones
and challenged to employ new strategies to deal with change. SeeViewpoint: How HR Can
Increase Women's Access to Critical Stretch Opportunities and How to Become a More Fearless
HR Leader.

Group-based leadership development

Group-based leadership development helps employees attain real-world skills in real time. This
method of leadership development can occur through varied methods, including outside
experience (such as in community, industry or professional groups), internal programs or external
executive education programs. Group-based leadership development requires leaders and
potential future leaders to work in unison to:

 Develop executive skill sets.

 Provide one another with high-value constructive feedback.
 Enhance interpersonal communication.
 Break functional silos.
 Tackle real-world challenges in real time.

SeePractice Makes Proficient: Develop Your Leadership.

Future trends

The Center for Creative Leadership, a research and education company, has identified four trends
for future leadership development programs:

 Vertical development. The traditional focus, known as horizontal development, is on

reinforcing the fundamental skills and competencies needed to perform well at one's
current level. While that will still be important, the uncertainty of the emerging world of
work will require a stronger emphasis on building employees' leadership capacity in more-
complex roles.
 Individual ownership. Established models rely on organizational structures, including
human resources, to sponsor and coordinate leadership development initiatives. But the
strongest benefits are realized when workers are able to determine their own training
agenda.
 Collective leadership. Less hierarchy and more fluidity in the workplace will require
leadership skills to be more widely distributed across the workforce.
 Innovation. Greater agility and more experimentation are needed to meet the demands of
the new environment.