How Leaders Develop Next-Generation Leaders: 5 Critical Capabilities (Part 1 of 3)

Your company’s long-term strategic advantage relies on strong leadership to align people, execute strategy, clearly define the culture, and engage all employees. But as Baby Boomer leaders rapidly retire, most of their collective leadership experience — often 30 to 40 years’ worth — is out the door.

Gen X leaders have waited patiently for their chance, and behind them is a tidal wave of Millennials who are eager to lead. However, both groups will need help. Are you ready? Many organizations aren’t. In a recent study of 54 large corporations across seven industries, a majority rated leadership talent pipeline gaps as critical. Many CHROs and global talent executives readily admit they’re lagging in this area.

The challenge is to accelerate the development of upcoming talent that can lead your organization through market changes—without the benefit of 20 years of leadership experience. HR departments are working diligently to build this talent, but many organizations have a leadership development timeframe averaging 5–7 years^[1], and companies cannot wait that long. The present challenges are too great for HR to tackle alone. Building a strong pipeline of leadership talent requires a concerted effort across the organization.

Fortunately, you already possess your “secret weapon” for developing leadership talent: your current leaders. More than formal training or developmental assignments, it is the coaching, feedback, and learning opportunities from experienced leaders that can accelerate development of emerging leaders. They know exactly what is needed for the job. They are available daily. They interact with high-potentials throughout their progression. They already track performance and coach individuals with in-the-moment feedback. This places these experienced leaders in an optimal position to help HR and the organization develop talent, in place, right now.

Most successful organizations make “developing leaders” a central part of their culture, and align their leaders’ behaviors to support the talent pipeline.^[2] True competitive advantage comes:

• When leaders are selected not only for their technical skills, but for their ability to grow the next generation of leaders.
• When observing and coaching others is a core part of the leaders role, and is rewarded.
• When leaders are held accountable for identifying and developing talent.

Therefore, leaders at every level can—and need to—drive leadership development, because it’s not just a staffing issue—it’s about having the right leaders in place to keep executing strategy. When new leaders are ill-prepared, their teams suffer poor focus and misalignment, and execution falters. This is why the business and HR need to employ current leaders to help build the talent pipeline for long-term survival and success.

Easy to say, but it’s not simple. Some leaders don’t realize it is part of their job responsibilities. Some lack the skills or awareness of how to do it. Many struggle with observing, coaching, and supporting emerging leaders on their teams. But leaders need to know that developing next-generation leaders is a crucial part of their job. In many cases, they need guidance in what to do—what behaviors they must demonstrate. HR plays a critical role in assisting with the effort.

So, what makes a good talent developer? Leaders who excel at developing emerging leaders leverage five critical capabilities:

1. Strategic talent mindset (they are naturally focused on strategic talent)
2. Talent identification (they’re good at spotting leadership talent)
3. Creating development opportunities (they proactively seek and create opportunities that stretch the emerging leader’s capacity)
4. Coaching skills (they provide effective feedback and guide emerging leaders through key learning experiences)
5. Interpersonal awareness (they listen effectively and understand what drives the emerging leaders in their team)

Your leaders can improve in all five of these capabilities, and thus improve their ability to develop others. HR and senior leadership can help by setting expectations, assessing leaders’ capabilities, coaching, and holding everyone accountable for making it happen.

Our next blog (Part 2, “A CHRO Solves a Leadership Deficit”) tells the story of a dynamic CHRO who leveraged these five critical capabilities to dramatically improve the talent pipeline. Her organization’s internal promotion of C-suite leaders went from 0% to 80% and VPs went from 29% to 90%. It is a true success story—watch for it!

FOR MORE—Please download our free white paper, “HR Creates Competitive Advantage by Helping Leaders Become Developers of Talent.”

[1] Audrey Williams-Lee. “Accelerated Leadership Development Tops the Talent Management Menu at McDonald’s,” Global Business and Organizational Excellence, April 2008.

[2] Gunter Stahl, et al. “Global Talent Management: How Leading Multinationals Build and Sustain Their Talent Pipelines,” Sloan Management Review, August 2012.