Jeffrey M. Cohn

Rakesh Khurana

Laura Reeves

<article-ideainbrief class="article-ideainbrief">
 <h4 class="ideainbrief-title">The Idea in Brief</h4>
 <div class="ideainbrief-contents">
  <p>Like any manager, you can expect your firm to face periodic upheavals—for example, a major acquisition or the emergence of ominous new competitors. If you don’t have the right people in the right roles to guide your company through such choppy waters, you put your company at grave risk. For example, you may be forced to promote untested junior managers or hire outsiders who can’t adjust to your company’s culture fast enough to successfully lead change.</p>
  <p>How to mitigate such risk? Create an <strong>integrated leadership development program</strong>. Unlike stand-alone, ad hoc development activities, an integrated leadership development program is owned by everyone in your organization: CEOs and VPs develop plans for replacing themselves. Board members actively identify and develop rising stars. Line managers willingly relinquish their best performers to other units so emerging leaders can gain cross-functional experience.</p>
  <p>Carefully crafted, your integrated leadership development program becomes a core part of your company’s value proposition. You attract talented future leaders, establish the bench strength you need to execute crucial strategic initiatives, and boost shareholder confidence in your firm. And because rivals can’t copy your program, it becomes an enduring source of competitive advantage—as giants such as Tyson Foods, Mellon Financial Corporation, and Starbucks have discovered.</p>
  <p>The Idea in Practice</p>
  <p>To create your integrated leadership development program:</p>
  <h2>Embrace Succession Planning</h2>
  <p>Too many CEOs consider the term “succession planning” taboo—akin to planning their own funeral. To build strong leadership teams, CEOs—and leaders at least three levels below—must embrace succession planning and integrate it closely with management-training and development programs. <span style="idea-in-practice-example"><span style="idea-in-practice-example-header">Example:&nbsp;</span> </span></p>
  <p>When Orin Smith took Starbucks’ helm in 2000, he established an exit date of 2005. He recruited Jim Donald as a promising successor. Then he groomed Donald for the CEO position by having him work in stores to understand the customer experience and visit coffee-roasting plants to observe operations. Eventually shouldering responsibility for North American operations, Donald developed his own succession plan—assessing and developing potential leaders who could take over his assignments and provide the right fit with the leadership team. </p>
  <h2>Involve the Board</h2>
  <p>Detached from daily operations and biases, your board of directors can objectively assess your company’s leadership development systems and bench strength. Encourage directors to get to know your firm’s rising stars: board members will gauge the efficacy of your leadership pipeline, and emerging leaders will gain experience presenting to the top of the house—a key development opportunity. <span style="idea-in-practice-example"><span style="idea-in-practice-example-header">Example:&nbsp;</span> </span></p>
  <p>Mellon Financial Corporation once required heads of major business units to give presentations to the board. But starting in 2002, CEO Marty McGuinn began having rising stars make these presentations. Unit managers accompany their emerging leaders to board meetings and answer questions only when absolutely necessary. But the future leaders get the floor. </p>
  <h2>Insist that Managers Share Top Performers</h2>
  <p>Motivate unit leaders to share brilliant junior managers with other units. High-potential leaders will gain exposure to your company’s operations and see how the organization’s parts collaborate to execute strategy. Cross-functional assignments also provide opportunities to master new business challenges, such as managing a turnaround or launching a product in a new territory. These assignments also enable rising stars to broaden their spheres of influence. <span style="idea-in-practice-example"><span style="idea-in-practice-example-header">Example:&nbsp;</span> </span></p>
  <p>At Tyson Foods, unit leaders are held personally accountable for rotating emerging leaders through other parts of the company. The CEO and VP of HR monitor cross-functional development plans and ensure that unit leaders receive equally qualified managers in exchange for their outgoing ones. Tyson also links senior executives’ compensation to their ability to circulate and develop emerging leaders.</p>
 </div>
</article-ideainbrief><p>In the thirteenth century, it took the College of Cardinals almost three years to anoint a successor to Pope Clement IV. To break the stalemate, one of history’s most bitter organizational deadlocks, church officials began limiting the food and drink they provided the voting cardinals, eventually giving them just bread and water. Fortunately, today’s cardinals don’t seem to need such harsh incentives: It took them less than a week to choose Benedict XVI.</p>

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Growing Talent as if Your Business Depended on It

In companies where leadership development really works, it is not a stand-alone activity. It is a core process of the business, dyed into its very fabric.

Growing Talent as if Your Business Depended on It

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