The science of developing a leadership pipeline in an Indian company
‘tomorrow' will ensure that we do not rob our future generations of an eco-system that is in balance - Sustainability.
Today, top companies are developing ‘Leadership' as a core attribute for their employer brand
Top companies create Iconic Figures of their leaders thereby developing leadership capability in their employees through emulation. The Top Indian companies continue to be at the cutting edge when it comes to developing leaders, says Ajay Soni, Practice Leader, Hewitt Associates
The character of a per-son is known by how he/she behaves in the face of adversity. The manner in which com-panies responded to the economic dip over the past 12-18 months has laid the foundation for their future. There were companies who steadfast held their ground, took a few quick steps to manage the immediate challenges, but continued to focus on the critical business aspects and did not lose sight of their long term growth agenda. Those are the companies that are best positioned to leverage the economic recovery that we have started to see in India today.
Hewitt Associates recently concluded its Fifth Top Companies for Leaders Study (TCFL) in partnership with RBL group and Fortune magazine. The study clearly demonstrated that at the Top Companies, there is a direct correlation between building leaders and achieving ambitious growth targets and the focus is mainly on making selected investments in building leadership capability for the future. The key leadership and talent efforts are not abandoned in favor of short term pressures.
As in the previous TCFL studies, the Top Indian companies continue to be at the cutting edge when it comes to developing leaders. It comes as no surprise that five of the twelve Asia Pacific winners are Indian - ICICI Bank, Hindustan Unilever Limited (HUL), Aditya Birla Group (ABG), Infosys Technologies and Wipro Limited. These companies have shown tremendous business growth over the past few years. Interestingly, they ‘grew’ leaders at a higher rate at all levels of hierarchy.
Our longitudinal TCFL study has shown that Top Companies differentiate themselves by not having a handful of charismatic leaders. They work towards building a pipeline of leaders across the organization. These Top Companies do not depend on informal ways of development, but rather execute on robust processes for leadership development. The Top Companies do not focus on carrying out one-size-fits-all training programs but focus on creating a personalized holistic leadership development process.
Becoming a Top Company for Leaders — Our Research Insights
True to the title, our research validates that building a leadership pipeline is a scientific process. And its core ingredients are --
1. Branding Leadership -- For leading companies, building an external reputation for attracting and developing leadership is vital to long term success.
2. Getting the Leadership-Mix Right -- The Top Companies have their leader selection strategy closely tied to the business strategy.
3. Raising the Bar for Assessment -- The leading companies have a robust and transparent assessment process which is a moving target, adapting continually to the business realities.
4. Continuous Investment in Development -- The top companies have development processes that cater to the unique needs of individual leaders/budding leaders.
1. Branding Leadership
“We build Leaders!” -- A compelling Employee Value Proposition
92% of Top Companies, compared to just 38% of all other participants reported that they are very intentional in their efforts to build a reputation for strong leadership. Today, Top Companies are developing ‘Leadership’ as a core attribute for their Employer Brand. And this is proving to be more powerful and attractive than most conventional EVPs. People want to join the IBMs and Infosys of the world, not for the cash or the benefits they will get, but to become effective corporate Leaders. Top Companies are spoilt for choice for leadership candidates. They err on the side of developing more leaders, than ever having a dearth of options. ICICI, WIPRO and HUL exemplify this.
Leveraging the C-Suite
Top companies create Iconic Figures of their leaders thereby developing leadership capability in their employees through emulation. Employees tend to emulate their leaders, and therefore get groomed to follow their footsteps. This also reinforces the Leadership Brand and ensures a steady supply of strong leaders, generation after generation. ICICI and Infosys are striking examples of organizations that have created role models not just for their organization but for the entire industry at large. These role models then spend a significant time with future leaders to ensure their accelerated development.
2. Getting the Leadership Mix Right
The Grow or Buy Conundrum
All the TCFL winners have a clearly defined strategy for selecting leaders both internally as well as externally. The age old debate on ‘Grow’ v/s ‘Buy’, when it comes to leaders, has been laid to rest. This is because organizations where leaders were exclusively internally grown, a strong inward orientation crept in, stemming innovation and fresh ideas.
To keep their leaders outward oriented, and therefore always open to change, now Top Companies choose an amalgamation of internally grown and laterally hired talent, even at their highest levels.
Early Talent Spotting
Top Companies focus on spotting talent early. This implies as early as within two-four years of joining the organization. However, they also re-evaluate their high potentials year on year, which is a tag, the recognition of which has to be re-earned every year.
3. Raising the Bar for Assessment
Working the Funnel
Top Companies keep cleaning people who ‘power’ the system from people who ‘ride’ the system. Leaders in these organizations have not just risen above their peers, but are managing them; and that too without much attrition. This is because the selection processes are highly robust, transparent and multi-dimensional. Organizations like HUL and ABG have by now perfected the art of identifying the leaders at every level by using not only robust performance management systems but rigorous assessment on the “how” part of the performance.
Focusing on the future
Top Companies clearly define the jobs that will be critical for future success of the organization. They then create robust assessment processes to identify possible successors and systematically groom them for future. 100% of Top companies have talent pipeline to support future growth, as compared to just 50% of the rest.
4. Continuous Investment in Development
Leadership -- An Exacting Science
Contrary to the conventional discounting of Leadership on account of the associated subjectivity, Top Companies have, over the years, developed this discipline to almost an exacting Science. Some of them have Leadership Academies which are world renowned.
Breaking the Mould and Re-building it from Scratch
Top Companies create diversified experiences for Experiential Learning. They never allow their leaders to slip into their comfort zones or live off past glories. Which also explains why these employees are result-delivering leaders, no matter which organization, sector or industry they join next? HUL has been doing this for a long time now by giving cross functional and cross geographical exposure to its leaders. This has not only helped create a robust pipeline of leaders within HUL, but has also given Unilever many Leaders. WIPRO has been actively placing its high potentials on stretch assignments to ensure that there is challenge built in every job.
Playing the Conglomerate Card
The inherent disadvantage of being a Business House when it came to leadership development has now been turned into a unique strength. Many top conglomerates use the sheer magnitude and diversity of career opportunities that they can offer to their talent, to create a virtual job market within the Group. These organizations do not attach a premium to sector specific experience, thereby creating leaders seamlessly. These companies have also leveraged life-cycle issues of their mature business vis-à-vis nascent businesses to their advantage. They do this by giving their leaders opportunities of focusing on the bottom line for flagship businesses on the one hand, and aggressively growing the top line for start ups on the other. This also provides a larger canvass to match the lifecycle of the employee and his/ her individual aspirations to new roles in the organization.
A case in point here would be one of the Top Companies in Asia Pacific; Aditya Birla Group which has stated an employer brand: A World of Opportunities. This translates into multiple career choices for its employees. GE, one of the global winners has by now perfected the art of playing the conglomerate card.
While the foundation pillars may be universal, Leadership brand and development is as unique to an organization as the employees who run it. Each organization has unique attributes that it can leverage to attract, develop and retain its leaders. The trick is to uncover these elements, create systematic processes around these and then ruthlessly execute them to get the optimal results.
Building leadership is not about spending maximum dollars for maximum impact. It is about understanding the gene code of leadership in the organization, then building a framework from right selection of a candidate to laddering future skills, abilities and opportunities for high potentials. Top Companies are smart enough to manufacture stars, not wait for a flash in their Organizational pan.