27 Feb How to Align Your Leadership Development Strategy with Your Business Strategy
Did you know that only a quarter of organisations say their leadership development programmes are effective at improving performance? Research by McKinsey shows that one of the biggest mistakes companies make is they don’t align their leadership development strategy with their business strategy.
So, let’s fix that. This blog post looks at how you can do that.
Leadership that is fit for purpose
I’ve had a couple of clients ask me for examples of ‘world-class’ leadership development, mentoring programmes or coaching programmes. And to be honest, the questions make me nervous.
Now don’t get me wrong, I am all for learning from the experiences of others. Hearing what other companies have done can stimulate great ideas and creativity. But you’re doomed if you slavishly copy the approach of another organisation.
In my humble opinion, world-class leadership development is characterised by one overriding principle: it is designed specifically to meet the needs of one organisation and its employees, developing leaders who can deliver strategy and drive business results.
When I left P&G, I moved to the head office of Prontaprint, a print franchise organisation. I had ambitious, large-scale ideas based on my experience of P&G and what, no doubt, would be considered world-class training and development. My ideas included introducing a performance management process, coaching and mentoring initiatives and training programmes for managers and leaders.
But, ambitious ideas weren’t what the company needed. The world was changing to one where every company had their own in-house printer, so Prontaprint leaders had to change too. They were used to a retail focus where customers walked through the door. Instead, they had to adopt a sales focus and promote their services to other businesses. From a leadership development perspective, the critical individuals were the MDs of each business, and the immediate priority was for Prontaprint to develop its sales and marketing skills to make that transformation. My ideas on introducing people management practices were good, but they were based on what I thought was important, not on what the company needed.
Companies that consistently produce great talent and grow successfully do not have the most sophisticated or complex leadership development practices. Instead, they have practices that are fit for purpose, suit their culture, are relatively simple and are executed flawlessly.
World-class leadership development is designed to drive business results. No more, no less.
Leadership is about the future. Fast-growing companies need leaders who can take them there. So what better way to develop your future leaders than by engaging them now in creating the business they will be running?
Too often companies define the leadership development strategy as being separate and independent of the business strategy. That is not just poor practice, it’s plain wrong.
Your business goals drive the quality and quantity of leaders you need. And your strategy will be unique to the business context you are working in. As a fast-growing company, you will need to focus on bringing in new people, expanding rapidly and building your employment brand. Depending on your growth plans, you might need to increase the number of leaders at every level by 10% or more every year over the next three years.
If you’re at a stage of globalising the business, your focus might be on integrating recruitment with an internal mobility programme. If you’re suffering from low engagement and employee performance, your focus might be on revamping performance discussions and development.
A technology company recently came to me after internal discussions around their lack of a leadership pipeline. It was a specialised IT company that had grown rapidly over the past five years and was finding it hard to recruit from outside. Its attrition was not too bad even though it was a tough environment, but the senior staff knew their people were young, hungry and ambitious. They wanted to make sure they looked after them, kept them and developed them.
Their number one question was, ‘How do we define talent?’
The reality is that there is no single definition of talent or leadership. It will depend on what you’re trying to achieve as a business.
When you’re developing leaders, the starting point is to be clear on what kind of business you need to be in the future. Wherever your focus, you need to answer these questions:
What are the organisation vision and business strategy that our leaders need to deliver?
What are the key roles to help us overcome our business challenges?
What leadership skills do we need to realise our vision?
What culture do we need to develop leadership throughout the organisation?
The first step in defining your leadership strategy is to review the vision and strategy for the organisation. Identify the key drivers that will be critical for the organisation’s success, i.e. the relatively few (three to five) determinants of sustainable competitive advantage for your company in your industry.
Drivers are the choices that leaders make about how to position the organisation. That position should take advantage of its strengths and weaknesses as an organisation, recognising the opportunities and threats in the marketplace. Drivers make a strategy unique to one organisation compared to another, dictate where trade-offs can be made between resources, time and energy, and help you understand what it is essential for leaders of the organisation to do.
You can identify the key drivers by asking a few fundamental questions:
Is this driver an organisational talent that is absolutely vital?
Could something else be more important in making the vision and mission happen?
Defined relatively, what is most important to our success and our ability to compete?
Is this something the organisation is positioned to do better than its competitors?
Will doing this effectively translate directly into continued or future success?
Would not doing this effectively cause the organisation to fail?
The key drivers and their associated business strategies will have clear implications: they state what leaders must do well for the organisation to succeed. That will allow you to define the skills and behaviours your leaders will need to be successful.
Want to find out more about developing a strategic approach to leadership development? Download our free ebook LEADER – How to Develop Remarkable Leaders Who Deliver Amazing Results