Leadership Development- Setting the Context  

Leadership Development

There are two challenges with leadership. One is to define the end-goal in achieving leadership competencies aligned to the business goals. The other is how to achieve that end-goal. The chapter on leadership development endeavors to cover the methods, principles and thumb rules on how to build the 'leadership capital'.


Leadership Development- Setting the Context


Leaders are made as much as they are born. The inherent leadership DNA has to be shaped and molded to build leadership talent, which can respond to the need of time and context. There are many case-studies, where organizations have nurtured leadership. Once an organization can set its eyes on what are their leadership development goals to achieve their business objectives, a diligent planning and execution makes-it-happen.

smritu ahujaThis page is authored by Smriti Ahuja, an exprienced Human Resources Leader. Smriti is currently consulting as an independent professional. Till recently, she has been heading global leadership development portfolio in Genpact

Leadership and Management are two action verbs that have been compared ad nauseam. Picking up one of the simplest and most oft quoted differences

“Management is doing things right and leadership is doing the right things.”

Well the point here is that, management is something that we are expected to do all through are childhood. We are given instructions on “what to do “and our happiness and reward depends on how well we do that. Year, in year, its pretty much the same pattern of   conforming to the regulations and rules that a child’s world is surrounded with. On time conformance, with reasonable quality is enough to be rewarded with a “good boy “by the various adults in a young child’s life. Going with the team and thinking along the lines of conventional wisdom gets you the sobriquet of being well behaved.  With these environmental influences and some disciplining thrown in, most of us already have the seed of being good mangers embedded in.

Leadership, well that is another matter. Going back to the childhood influences, each one of us has noted, experienced or been guilty of accusing a child of precocity if the child tries to assert herself by questioning a judgment or shows strong initiative. Imagine a scenario of a mother and a 12 year child that goes something like this

Mother: ‘Don’t forget to drink your milk “

Child: "Hmmph"

Mother: "Why can’t you just say 'sure', or 'will do' instead of this silly response?"

Child: "ok"

Mother: "what does the ok mean? Will you, have the milk?"

Child: "No"

Mother: <voice raised>, "have you been throwing the milk in the sink everyday"

Child: <quiet>

Mother: "Tell me, I demand to know. Why are you not following what I tell you to? I am your mother, and I know what I am doing, Milk is essential for your healthy growth. Come on speak up!!"

Child: "Ma, that is not true."

Mother: "what is not true? That I know what is best for you? What on earth is wrong with you?"

Child: "No ma, it’s the milk I was talking about you."

By now the mother is completely befuddled

Child: <continuing>, "Japan had no dairy culture until the end of World War II. Japanese had essentially been vegetarians for several hundred years. Cereals, soybeans, vegetables and occasional seafood consumption met nutritional needs. Ordinary Japanese neither drank milk nor ate dairy products. In contrast to Western people who have been drinking milk for several hundred years. Cows' milk at one time may have been beneficial for Western people, but I have read will show evidence for its ill effects on humans ….,"[ref 1]

Where do you think the conversation went after that? Our lives and our children lives are littered with conversations such as these. Where a different point of view, an initiative to learn more and beyond what is earmarked is met with exasperation and in some hopeful houses with hidden pride, though the message finally is “Drink your milk “

It is only the emotionally toughest child who can still persist with that behavior as he or she grows into adulthood. Little wonder that so few of us are ready for this shift from management to leadership, since the leadership behaviors have long since been discarded, under the onslaught of conformance and being a part of the group.

This is why you will rarely bump into the ready made leader. The right body of skills and knowledge can still be seen in fair numbers of the corporate citizens, but the behaviors and guts, rarely. Emotional Intelligence appraisal predicts 80% of leadership performance

Leaders are made just as much as they are born.

John Paul Kotter, the Harvard professor, who is regarded as an authority on leadership, in his book, A force for change concludes that “Thousands of companies today are over-managed and under-led, not because managers lack charisma, but because far too few executives have a clear understanding of what leadership is and what it can accomplish”. He goes on to show how leadership turned around operations at P&G and Kodak; produced huge business successes at PepsiCo, ARCO, and ConAgra; and made the impossible occasionally happen at Digital. And that is indeed the power of leadership.

Building the case on what leadership can accomplish

McKesson Corporation acquired HBOC, a publicly held healthcare IT company, in 1999. Shortly after the acquisition, the company experienced significant business challenges that resulted in a dramatic increase in turnover at all levels of the organization. Employee and customer satisfaction scores also plummeted at the company, now known as McKesson Information Solutions.

"We faced the departure of the entire senior executive team and a significant number of middle managers," said Terry Geraghty, Senior Vice President of Human Resources for McKesson Information Solutions. "Our turnover climbed to more than 20 percent, and we lost customer confidence. Clearly, we needed decisive leadership action."

The newly installed senior management team delivered by immediately establishing goals in four key areas: customer satisfaction, employee satisfaction, accountability, and financial performance. McKesson considered leadership essential to achieving these goals, especially the employee satisfaction component. The challenge? The majority of newly installed leaders had never been exposed to formal management training, with many receiving battlefield promotions due to the high management turnover. While the technical skills were strong, the soft skills were missing in action. McKesson's first step in overcoming the leadership hurdle was building a leadership competency model that was based on the company's business goals and core principles . They engaged   DDI, (consultants in the area of developing leadership talent ) to help with this process.  

Following DDI's competency modeling, McKesson developed a 12-module leadership curriculum. Every leader and aspiring leader is encouraged to participate in the certification process, which took a minimum of two years to complete .This was further supported by  DDI's Leadership MirrorSM multi-rater feedback surveys early in the program and during the final module to measure individual improvement.

McKesson launched "LEAD the Way" in January 2001, putting more than 700 leaders and aspiring leaders through the first module, Maximizing Performance, in less than two months.

McKesson Information Solutions achieved the following results due, in part, to the leadership initiatives launched in 2001.

  • Employee turnover reduced from 20.4 percent in March 2000 to 4.8 percent in June 2002.
  • The company posted a decline in turnover for 23 consecutive months.
  • Employee satisfaction increased from 3.55 in October 1999 to 3.80 in 2002 on a 5.0 scale, well above the industry average and approaching world-class standards in some categories.
  • The employee referral rate increased from 25 percent in 2001 to 30 percent in 2002 (30 percent of all employees hired came from direct referrals by current employees).
  • Customer satisfaction scores increased from 4.94 on a 7.0 scale to 5.38 in just two years.
  • Sales Revenue, operating income, and other financial measures have seen dramatic improvements.

Mckesson early on understood that strong leadership is a competitive advantage and took the challenge head on and at a scale that covered every leader and aspiring leader, leading to the turnaround. [ref 2]

Leadership is a competitive advantage, and something that no organization can afford to ignore in terms of time or resources.

There is too, the case study of Infosys, which focused its leadership efforts, besides others, on developing a sales force that would grow revenue for $ 1 billion to $ 4 billion in just 4 years. The results from this focused leadership development were, amongst other things

  • Tripled sales revenues within three years, from $1 billion to $3 billion. An additional $1 billion increase in revenue was realized the following year.
  • 43 percent of company revenues generated from services not offered five years earlier—evidence of Infosys’ growing ability to sell more strategic solutions.
  • Doubled sales force productivity, with just a 30-percent increase in sales force headcount. [ref 2]

These are just a couple of cases in point. There are thousand others that abound.

It would be impossible to conclude any discussion on the power of leadership without mentioning the list of achievements a leader such as Jack Welch had on the fortunes of a 100 year old conglomerate. When he left the company in 2004 he had taken it from a market valuation of $14 billion to $410 billion. He led it to be on the forefront of not only business indexes but also on the soft culture aspects, being named the manager of the century for his achievements.

Further in the pages we will look at the emphasis that Jack Welch placed on Leadership and leadership development, knowing fully well its impact on the state of the business

References

  1. Hormonal effects of cows milk on human health- Sato A & Ganmaa D
  2. DDI- Client case studies

 

Note- The copyright to this page belongs to Ms. Smriti Ahuja