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Leading the Leaders


<b>Recent research suggests that poor leadership is holding back the UK economy. Stefan Stern assesses the drive to develop executive skills</b>

UK companies are starting to realise that there is trouble at the top. Last years report by the Govern-ments Council for Excellence in Management and Leadership (CEML) was unequivocal: The UKs economic performance is being held back by a shortage of appropriate and practical leadership skills. These skills are in short supply from the top to the bottom of organisations.

The reasons behind the UKs underperformance, lack of productivity growth and failure to compete have been debated for many years. But the focus for much of the concern is now falling on senior management. Michael Porter of Harvard University reported earlier this year on the

UKs continuing difficulty in climbing up the international competitiveness and productivity league tables, while Derek Higgss study into corporate governance declared that Britains boardrooms did not contain enough independent, creative and challenging thinkers. All in all, it would seem that the UK executive community has plenty of room for improvement.

Some companies have recognised the need and are actively working on it. Sandy Begbie, director for group organisation and leadership development at ScottishPower, works with the firms top 250 managers on a programme of leadership development. Identifying the leaders and high potentials is the first step, although as Begbie concedes, it is not always an exact science. The important thing is that the process is dynamic.

ScottishPower reviews its pool of leadership talent three times a year, and a wide range of data is used to measure performance. We look for strong trends in performance, based on 360 feedback and assessment,

he says. People may plateau or even go backwards, so you have to know that you are working with the

right group.

Begbie and his team of four work as client managers with the top 250. This means that every colleague identified as a leader has a single point of contact, in addition to his or her line manager, with whom to build a development plan, receive coaching and support. It is a very individual relationship, but also ensures that the company invests properly in people, Begbie says. We review needs two or three times a year. My responsibilities have grown to include resourcing and reward for senior management, so my work is closely linked to all aspects of the employment experience. The backing of the CEO is crucial in all this: if you dont have it you are never going to be as effective as you could be.

That sense of leadership development as a dynamic process is echoed by Sue Cox, until recently group personnel director at investment bank Schroders, now working as an executive coach. Sometimes people go away on a course and what they have learned fades, Cox says. It is far more effective to give your future leaders the opportunity to learn and practise management skills as they progress. She also emphasises the need to identify future talent. But it is not easy. Having very good open feedback will help. Project reports and your own observation are important, she says. And when you hear that someone is doing a great job, find out what that means, and work hard at finding the people with aptitude.

In some cases the need for leadership development is immediate. It is a particularly pressing issue in the

public sector, with the Government striving to deliver better services. The London Borough of Bromley is currently investing over 200,000 in its top team of 45 senior managers. We are going through a period of significant change, says Richard Foulger, seconded to work with the councils CEO on Bromleys leadership programme. The demands on us as a council are increasing, while resources are reducing. We have to get more out of people not through working longer hours but by offering better leadership, he says.

Working with consultants from the Hay Group, managers took part in 360 feedback, and over a two-and-half-day workshop compared their own assessment of themselves with that of their colleagues. This highlights the gap between how you see yourself and how they see you, Foulger says. Its a bit of a shock for some people but others have said, If only I had known this 10 years ago.

Bromleys managers have access to Hay coaches, and have also formed action learning sets where senior managers provide mutual support, and learn to develop their own coaching skills. Sustainability is what we are after, says Foulger. We didnt just want to go on a five-day course and leave it at that. After an initial nine-month period with Hay we will do 360s again, and try and maintain

the development.

How can HR managers ensure that any attempts at leadership or executive development are not doomed to fail before they begin? Zoe Gruhn is head of the Hay Groups leadership development and coaching practice in the UK. She is clear about the nature of the task. The HR function has to be fully immersed in the organisation not necessarily on the board but working as a kind of right-hand man to the chief executive, she says. There has to be clear backing and support from the top.

Really the HR director should understand the organisations DNA, she adds. It is a roving role, and also one where you should be a kind of gatekeeper to the CEO, challenging thinking at the top and suggesting appropriate interventions.

So how much work is going on to develop leaders in UK businesses and organisations? Just about everybody is looking at this, says Andrew Constable, director of consultancy and bespoke services at the Roffey Park Institute, which has been working with public, private and

not-for-profit organisations. In the field of education, head-teachers and university vice-chancellors are receiving unprecedented attention, as the pressure mounts from Whitehall to deliver on government targets. The organisation of further education and skills training is being completely overhauled too. Everywhere you look in corporate and not-for-profit Britain, leaders and senior executives are under scrutiny.

Constable backs the views of ScottishPowers Begbie on the essential ingredient in leadership development programmes: Leadership development has to start at the top if it is going to be successful, he says. It is not sufficient to have a terrific programme, but with the existing top management not on it.

He also points to last years CEML report into UK leadership as providing a useful summary of what development work needs to be done. In five key areas, the report said, there is room for improvement. These are strategic thinking, communication, leading teams, motivating people and developing and promoting cultural and ethical standards.

HR has a key role in driving development initiatives inside the organisation, perhaps as a sponsor of the programme, championing the intervention, says Constable. And it is vital that senior HR people are participants on programmes too. Its important that they can say, Im going through this as well.

HR has another crucial role to play: ensuring that development programmes are relevant and offer

genuine value for money. That means, of course, knowing what you are trying to achieve. Chris Watkin, a leadership development expert also at the Hay Group, says that this job of defining what work is required is sometimes not done carefully enough.

You need to work back from your strategy, he says, presuming that you are clear what that is, and then ask yourself what sort of behaviour you will need from your senior people in order to deliver that strategy.

This approach will help you define what successful executive development might look like, because you will be able to measure progress against specific criteria. A lot of leadership development programmes look pretty similar, Watkin adds. They involve the giving back of feedback against specific measures. In theory you should be getting an increasing insight into how you behave.

This sort of systematic assessment is what Hay has been working on with Unilever over the past few years. The company has been concentrating on a strategy of delivering growth and increased value for sharehold-ers. Unilever understood that this strategy would require a specific

kind of leadership behaviour from senior people.

We went out across the world and asked the company to show us who their strongest leaders were, Watkin says. We wanted to find out what it was about them and their behaviour that helped achieve the right results. We also wanted to meet what you might call typical middle-rung managers.

He continues: This helped us build up a clear set of criteria: what do exceptional people do differently? This becomes your framework for leadership development work. Whatever you do will be aligned to it, providing a structure and offering role models.

How is leadership development going to be delivered? Feedback, assessment and appraisal are all valuable, but when you are talking about senior people then something extra is required. Elite performers will expect to be handled differently.

In recent years coaching has emerged as the missing development link in the debate. Coaching offers a different kind of approach. It is, in a sense, a more grown-up way of raising performance.

Roger Evans is a senior coach with consultants DBM. He has seen the growing popularity of coaching at first hand. Theres been a gradual realisation that coaching is one of the most effective ways of developing leaders, he says. Over the past five years weve seen leaders coming under more pressure than ever before. There is a perceived need for something that can deliver more.

But what about the scepticism of senior people who dont think they have much left to learn? Actually we dont meet too much of that, Evans adds. Sometimes people say, I

need somebody who talks my language, but coaching is the opposite of that. This is not a cosy fireside chat relationship. The conversation is going to take people outside their comfort zone.

Coaching should not be confused with mentoring. Mentoring is essentially about knowledge transfer, he adds, perhaps on an ongoing basis. Coaching is a finite relationship. It is about helping very bright people make the best decisions for themselves. But organisations are getting much more selective about who they will spend their money on. There are three main categories, he explains: mission critical people, who are going to have to deliver over the next few years; keepers some long-term stayers who have been through a lot of change; and high-potential colleagues. That is where the coaching budget is being spent.

Hays Gruhn also supports the role of coaching, and adds that when the culture of coaching is truly embedded in an organisation more benefits can be realised. When there is what I call co-coaching going on colleagues deploying coaching techniques with each other then performance can be raised significantly.

At BP, Anne Ewing, vice president, organisational capabilities, says that developing leaders involves growing your own, moving talented people through a range of demanding roles. Leaders develop other leaders, she says. There is an obligation on the current leadership to provide challenging career opportunities for future leaders.

Leaders have a duty, not just to themselves, but to the organisations that they lead, to try and be the best that they can. In the Spiderman story the superheros uncle tells the young crime-buster: With great power comes great responsibility. Back in the workplace the language may be a little more restrained, but the challenge for leaders is no less important. Its about creating winners rather than just being a winner, says DBMs Evans. Leaders everywhere need to keep on smartening up their act.