Magazine Fall 2008 Research Highlight

Can You Measure Leadership?

At top companies, where the inspired use of metrics helps to identify potential leaders and develop their skills, the answer is yes.

Robert Gandossy and Robin Guarnieri Reading Time: 17 min 

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Companies today live under the relentless glare of metrics. Quarterly earnings releases, sales projections, quality and compliance audits, even employee surveys are used to gauge the enterprise’s health. Nevertheless, few such measures directly answer a key question that is frequently on the minds of the senior team: Do we have enough leaders, and the right leaders, to run our business both today and in the future?

Many CEOs cite the lack of qualified leadership talent as the most significant constraint on growth. This is happening as the pool of potential leaders shrinks before our eyes; the number of 35-to 44-year-olds in the work force, the so-called “key leader age,” will drop by 15% over the next decade, according to the U.S. Bureau of Labor Statistics. Thus the pressure on company decision makers to rethink their leadership development strategies is greater than ever.

Human resources executives and corporate leaders across the globe find that it’s simply not enough to put a leadership-training program in place or hold an annual talent review. Instead, companies must be rigorous and focused in their assessment of leadership talent, aided by tools tailored to help achieve that end. They must hold leaders accountable for cultivating others, diagnosing gaps in execution and capability, and redirecting resources as business needs change. HR and business leaders also need insights into where they have succeeded in building leadership and critical talent pipelines and where there are potential risks. In short, companies need to bring a “measurement mind-set” to the often inexact process of developing the next generation of leaders.

Because such a process, though vital, is not easy, companies often overrate their ability to measure the right things for the right reasons. For example, many generate piles of reports on senior management attrition instead of considering the actual flight risks of their critical talent; or they measure easy-to-track metrics, such as time to fill jobs or number of training hours, without regard to the quality of those placed into jobs or whether a development workshop produced any meaningful change. Others, at the opposite extreme, get bogged down in a search for the holy grail of leadership metrics — fruitlessly searching for some “perfect answer” and consequently making little progress.

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About the Authors

Robert Gandossy is a principal and leads the leadership consulting practice at Hewitt Associates Inc., a human resources consulting and outsourcing company based in Lincolnshire, Illinois.Robin Guarnieri is a research consultant at Hewitt Associates. Both authors are based at the company’s office in Norwalk, Connecticut. Comment on this article or contact the authors through smrfeedback@mit.edu.

References

1. Hewitt initiated the Top Companies for Leaders research in 2001 to identify those factors that account for organizations’ ability to consistently produce great leaders. Subsequent undertakings in 2003 and 2005 further expanded our examination of successful leaders and their impacts on the organization and provided the foundation for our 2007 global study.

2. In the fictional town of Lake Wobegon, Minnesota, created by Garrison Keillor, “all the women are strong, all the men are good looking, and all the children are above average.”

3. This is the version of the nine-block framework used by many of the Top Companies for Leaders.

4. “Closing the Generational Divide,” IBM Institute for Business Value in association with the American Society for Training & Development, September 2006.

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Comments (3)
y.s.ganesh
Quantification of leadership develoment is difficult due to subjective traits involved in leadership qualities.Article is nice and highlights thought provoking issues of leadership measurement.Identification of traits involved in success need to be tagged for measurement. How to relate successful traits in success
buggy1
These programs alienate good people. It is a way to clean up and institutionalize cronyism and it drives out diversity. They are very demotivating. Everybody knows who is on the list and who isn't and they adjust their behavior accordingly. 

Horrible, horrible trend. 

And here is more heresy: talent, as defined by most of these programs, is NOT more important than skills, experience, willingness and motivation. Because the people running these programs define talent as "we-like-you" instead of as "you-are-capable."
bensimo
This all sounds like a very top-down approach to managing and leading people. But top-down by its very nature tends to demotivate and demoralize people. Isn't the goal of managing people to bring out their full capabilities, to unleash their full potential of creativity, innovation, productivity, motivation and commitment?

This being the goal, then what we need is a set of methods to unleash that potential. Those methods consist not of top-down communication but on a regular basis listening to employee complaints, suggestions and questions and responding very respectfully to them. People will only unleash their full capabilities if management meets their basic need to be heard and be respected. Listening and responding in a very timely and respectful manner are the only ways to do this.

I admit there is more to it, but in my 30+ years of managing people I progressed from 12 years of top-down to 12 years of moving to its opposite and the remaining years enjoying managerial nirvana as my people literally blew away competitors and loved to come to work. I do have a simple ten question test for managers that is reasonably accurate if the person providing the answers does so with integrity.

Best regards, Ben 
Author "Leading People to be Highly Motivated and Committed"