Organizational Success: Managing Your Human Talent

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Should I Stay? Should I Go?
by Cynthia Woolbright

In the article entitled, Turning Potential into Success: The Missing Link in Leadership Development, (Harvard Business Review, November-December 2017) senior leadership at the global executive search firm Egon Zehnder cites research conducted by the Corporate Executive Board (CEB) that found,

“Sixty-six percent of companies invest in programs that aim to identify high-potential employees and help them advance, but only 24% of senior executives at those firms consider the programs to be a success. A mere 13% have confidence in the rising leaders at their firms, down from an already-low 17% just three years ago. And at the world’s largest corporations—which each employ thousands of executives—a full 30% of new CEOs are hired from the outside.”

The article continues with this intriguing question: “Low engagement and high turnover are extremely costly for organizations, especially if the people jumping ship are high potentials in whom much has already been invested. How can companies prevent this massive waste of talent and create more-effective development programs?”

As many of us in the business of managing human talent have long known, successfully identifying and cultivating talent starts with establishing key competencies and thoughtfully assessing employee potential for filling managerial positions. Because each organization has its own unique requirements, it is critical that each takes the time to identify the competencies that are important in the context of the organization’s challenges and goals.

Egon Zehnder posits that four key traits are among the best predictors of a leader: curiosity, insight, engagement, and determination (Aramaki). With those traits in mind, the company has developed a unique matrix that identifies (in their view) the most important competencies for leadership roles at large businesses paired with seven underlying characteristics (ranked from 1 – baseline to 7 – extraordinary) associated with each. The competencies are:

  • Results Orientation
  • Strategic Orientation
  • Collaboration and Influence
  • Team Leadership
  • Developing Organizational Capabilities
  • Change Leadership
  • Market Understanding
  • Inclusiveness

As one example, results orientation is characterized by (in order of ranking):

  1. Completes assignments
  2. Works to make things better
  3. Achieves goals
  4. Exceeds goals
  5. Improves organization’s practices and performance
  6. Redesigns practices for break-through results
  7. Transforms business model

Keep in mind, this type of assessment is not just important for those in the highest ranked positions. Organizations should also apply the same assessment methods for mid and lower managerial positions. The idea being to identify people with great potential, match them to positions to which they are best suited, and recruit from within.

One note of caution: resist the impulse to demand high levels of performance across all competencies because there is no perfect candidate. Selecting three to four to focus on, for example, is a much more realistic goal.

Ultimately, using this or a similar methodology, i.e., focusing on potential and figuring out how to help people build the competencies they need for various roles, organizations will be able to “spot high potential candidates and give them the support they need to succeed, resulting in higher engagement and lower turn-over of potential leaders–an extraordinary source of competitive advantage in the coming decades. And it will help many more managers transform themselves into the great leaders they were always meant to be.”

Aramaki, Claudio Fernández-AráozAndrew RoscoeKentaro. “Turning High-Potentials into Successful Leaders.” Harvard Business Review, 24 Oct. 2017, hbr.org/2017/11/turning-potential-into-success-the-missing-link-in-leadership-development.

Article: https://hbr.org/2017/11/turning-potential-into-success-the-missing-link-in-leadership-development

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