In the past couple of years, leadership has become the hottest topic in business. Companies see this hard-to-pin-down ability as essential to organizational success, and they want their executives to learn how to exercise it. As a result, leadership development has become a big business: Investment in leadership education and development approached $50 billion in 2000.1 Publishing houses are shaking the trees in hopes of finding the author of the next blockbuster leadership book; consulting firms that once focused exclusively on strategy have aggressively launched global leadership practices; and business schools have positioned themselves as prospective partners with companies in the lucrative leadership-education market.2

In this atmosphere, it is difficult to find a CEO of a large company who doesn’t have a carefully honed speech about the importance of developing next-generation leaders at every organizational level. And yet for most companies, the combination of eloquent statements and massive investments has not produced a sufficient pipeline of leaders. Many report that they have been forced to look outside the company for a new CEO or top executive team member, even though people brought in from the outside derail at significantly higher rates than internal hires. The very high rates of CEO turnover due to poor performance in recent years points to the problem: If companies were adept at developing leadership talent internally, it should be most apparent in the performance of senior leaders.3

Our research and advisory work involving dozens of companies over two decades leads us to believe that three pathologies are the root cause of the failure of so many leadership-development efforts. (See “About the Research.”) By pathology, we mean the causes and effects of systemic problems in the way organizations attempt to develop leadership capability. As with an actual disease, companies exhibit clear patterns that cause repeated failures or breakdowns in their capacity to create internal leadership talent. Until these pathologies are examined and understood, leadership-development initiatives will continue to produce flawed results despite the best of intentions and continual investments of time and money. Fortunately, there are ways of fighting these diseases so that companies can create healthy processes for preparing the leaders they’ll need in the future.

Pathology #1: The “Ownership Is Power” Mind-Set

In many organizations, older ways of managing are colliding with new realities about what makes companies and their employees tick. Leadership development suffers from this pathology when executives