Why and How to Build An Effective Leadership Pipeline

Do you want your business to fail as leaders change over time?  Most people would quickly answer “no,” but business actions say the opposite.  And doing the opposite is leaving your business future to chance.

Planning for leadership change is vital to future success.  Some businesses like GE have legendary succession planning, and more businesses have processes in place for CEO succession.  However, most businesses do not have much in the way of succession planning for other key positions.

Even if there is some level of succession planning, it is often just knowing who is available “right now” if a leader needs replacement.  This misses the second key element of effective succession:  building and maintaining a leadership “pipeline” that supplies great leadership candidates over time.  The pipeline essentially provides the “fuel” that enables the succession “engine” to work.

There is no “best answer” for building a leadership pipeline.  What each business needs depends on the particular business situation.  This article provides some starting points for building the best pipeline for your business.

The first fundamental

The first fundamental is not thinking of the pipeline as an isolated process.   All areas of the Total Business Success model – strategy, culture, people, and systems/processes – are necessary for an effective pipeline.  All model components should align and mutually support each other in developing leaders for the future.

Here are some example areas to review in your business:

• Business values.  Does the business have explicit values?   Are the values actionable?  How will those be instilled and reinforced in future leaders’ thinking and behavior?  How should future leaders and the selection process itself model the values?  Few businesses have actionable values or ensure all organizational components support the values … how can your business be different?
• Leadership model.  What is your business leadership model?  Even fewer leaders and companies have an answer to this question.  A consistent leadership pipeline will need some definition of leadership mindset and framework.  Otherwise, what will you teach to up-and-coming leaders? Without a model, leadership candidates will vary based on the models – stated or unstated – of those managing the pipeline.  Variation in leadership philosophy will create churn and discord in the business.  Also, how will you identify and select any leaders for compatibility from outside the business?
• Accountability for leadership identification and development.  Most companies have some form of performance management system.  Does the system help identify current and future leadership talent?  Critically important: are current leaders rewarded for developing other leaders? Even outside their area?
• Leadership selection and development.  Do current leaders have expertise in selecting, training, and mentoring future leaders?  If not, what will you do to remedy the situation?  How will you train future leaders to develop leaders?  The leadership pipeline should cover that as well.
• Number of leaders in the pipeline.  What is the leadership pool size needed to sustain the company for the future?  Consider current company strategy, growth, plans, and leadership turnover. How vulnerable is the business if one or more key leaders suddenly departed?
• Pipeline investment.  Is there enough margin in the business to support a leadership pipeline?  Leadership selection and development takes time and investment. The investment will yield dividends but requires up-front funding.
• Growing your own versus hiring outside.  Is there a perception that bringing in leaders from outside is the solution?  Outside leaders still require investment, since selection and onboarding take time and money.  Outside leaders also bring in different culture and value orientations that take additional time and effort to reorient.  Failure in reorientation risks diluting and eventually losing existing business culture and values.
• Generational issues.  Younger generations have different views about leadership and training.  Have you taken those into account?
• Motivation.  Does your business have knowledge workers?  Motivating knowledge workers is dramatically different from motivating other workers (see, for example, Daniel Pink’s popular book Drive).  Do your current leaders understand and practice leadership that increases motivation for knowledge workers?  How will you include this in your pipeline?  The pipeline will need to both train leaders in knowledge worker motivation AND motivate pipeline participants.
• Development effectiveness.  If you have current development programs, are they effective?  Training and development programs vary wildly in effectiveness.  Check past articles like What Everyone Should Know About Training and the 4X Training page for more information.  Start off on the right foot by building a pipeline that returns the most for your investment and avoids basic mistakes.

Building an effective leadership pipeline can be daunting.  That does not mean you should not do it.  Businesses without effective leadership pipelines are in jeopardy.  The question is not “if” we should build an effective pipeline, but “how” to build it.

Starting the leadership pipeline

The first thing to do is to identify what actions can be taken right away, then take them.  Don’t wait until you have developed everything down to the last detail.  Use the Wrong Until Right concepts in building, executing, and adjusting the leadership pipeline.

There is actually a way to begin or improve leadership development that returns positive ROI.  How? Begin the leadership development process as a peer mentoring program.

• Weaving workplace improvement projects into the program provide positive ROI.  The program will pay for itself.
• Workplace projects provide practice for new skills and application to “real world” situations. This provides purpose and motivation, accelerates effective learning, and adds relevancy to learning.
• More than one program can be run at the same time if development needs are high.
• The program structure lowers overhead for training teams via peer mentoring reducing coaching burdens.
• The peer mentoring approach works well with millennials and other future leader groups.  The program provides more purpose, individual contribution, and control that millennials seek.

Action questions for you as a leader:

• The key question:  do you have a superb pipeline of leaders who will take the business to new heights?
• Does your company have a succession approach and plans?  If not, why not?  If so, how effective are they?  Review your current programs in light of the questions above.
• How pressing are any needs for establishing succession or improving existing plans?
• How can you bring improvement needs to light and influence change?
• Leaders are responsible for leadership development and succession in their area. This is regardless of any other company support or lack thereof.  What have you done as a leader to identify and grow future leaders in your area?  Do you have replacement options for key roles?  You can take action independent of what the rest of the company is doing or not doing.

Remember:  above all, do not wait for a “perfect” solution or “right” time to start.  Find what you can do now to make improvements for your business future.

If you need any assistance, let us know how we can help …

 

By Mike Russell