Leadership development interventions often lack strategic rigor, and the results show—only 10 percent of CEOs strongly believe their leadership development initiatives have a clear business impact.
For organizations to develop successful strategies requires leaders who are trained to think critically about where to compete and how to break down big-picture strategies into the smallest, most granular components. To break through requires real rigor and data-driven analysis to identify pockets of opportunities invisible at an aggregate level.
Leadership development programs, however, are rarely as rigorous. Too many organizations focus on broad, generic leadership competency models that apply a one-size-fits-all approach. One organization we know held a workshop to help leaders foster a “more global mindset”—with little discussion on why a global mindset was valuable for the company strategy in the first place or what participants should do differently in their daily work.
When leadership development links to specific context and strategy, however, outcomes improve significantly. Organizations that are successful at this are 8.1 times more likely to focus on the most critical leadership behaviors linked to their performance objectives, compared to those that are not successful.
Too many organizations focus on broad, generic leadership competency models that apply a one-size-fits-all approach
How, then, can you identify the most critical leadership behaviors to propel performance? There are four key steps:
1. Identify the context of the organization and the leadership behaviors that matter. Every organization resides in a unique context, and the specific leadership behaviors that enhance performance objectives must be identified with rigor. Multiple lenses apply here, including industry, ownership structure, strategic objectives, geography and organizational culture.
For example, an oil and gas company might emphasize operational discipline and safety while a Private Equity-owned company might emphasize quick decision-making and a bias for action. One lens we always apply is that of organization health and recipe, which can be measured quantitatively and has a clear link to performance. Organizational health measures the ability of an organization to align around a common vision, execute effectively against that vision and renew itself through creative thinking. Our research shows that organizations at different stages of health require different leadership behaviors to be effective and transition to higher levels of health and performance.
2. Crystalize leadership aspirations in a tailored leadership model. This model—sometimes called leadership competencies or values—typically includes 3-6 overarching themes, each comprised of several specific underlying skills and/or behaviors.
For example, a conglomerate embarking on a new strategic direction was focused on customer centricity, addressing disjointed cultures across its operating companies, and constructing a leadership pipeline. As a result, the organization developed a tailored leadership model with six themes, all of which supported the strategic aspirations. The explicit focus on a handful of specific and tailored leadership behaviors ensured that participants saw the program’s immediate value in their daily jobs, with an average program rating of 9.3/10. At an organizational level, the leadership program contributed to a 13-percentage point increase in leadership effectiveness and a 14-percentage point increase in overall organizational health.
3. Pinpoint the 3-5 behaviors that matter most. We consistently find that leadership development initiatives hit obstacles when they try to change too many things at once. Organizations cannot address the whole leadership model at once and must prioritize. In practice, it is individuals who must begin doing things differently on the job and developing sustainable behavioral change can prove challenging.
4. Identify the difference between the leadership the organization requires and where it stands today. This is the concrete gap across the 3-5 priority behaviors that the leadership development program should fill. Sometimes called “from-to” shifts, they serve as an objective measuring stick for program success. It is critical the behaviors are defined in detail, as they will ultimately drive the design of the program.
Few successful organizations operate with a vague notion of strategy. Similarly, it pays for organizations to pinpoint specific leadership behaviors required based on their context and to ensure that leadership development efforts are laser focused on addressing them.
Defining the critical leadership shifts that matter to performance is the first of four core principles we outline in McKinsey’s new book, Leadership at Scale. Our next blog post in this series will explain why organizations need to engage a critical mass of pivotal influencers during leadership development programs to ensure the change effort sticks.