NZIM LEADERSHIP : In Tough Times? Keep developing your leaders

Leadership development needs to be one of the chief executive’s key priorities, even in tough times, according to NZIM Northern chief executive, Kevin Gaunt. “And they need to dedicate specific time to the task every week. Doing so demonstrates to the rest of the organisation that focus on leadership, as opposed to managing, which is about getting things done, is vitally important.”
The BusinessWeek/Hay Group study of America’s 20 Best Companies for Leadership found these companies continued to make leadership development priority over the past year, despite the sad state of the US economy. The study also revealed shift in what top companies now value in leaders. Strategic thinking and inspiring leadership were, according to Hay Group New Zealand’s Ian MacRae, the most valued leadership qualities this year which “indicated that businesses are starting to dig out from the turmoil and are again thinking more about their future long-term growth”.
John Larrere, senior consultant at Hay and co-leader of the Best Companies study, believes today’s rapidly changing world is impacting on how organisations do business and, consequently, the old rules of how organisations “select, develop and retain good leaders have been turned upside down causing the future of leadership to look very different”.
“For organisations to succeed, they will need to understand what key leadership elements are paramount in driving organisational growth,” he adds. “It is more than just getting people to produce the right outcomes. It’s about getting them to be passionate about their work and grooming them to handle the challenges ahead.”
Gaunt is not surprised by the study’s findings. “Leadership,” he says, “is about being able to recognise where organisations need to go and communicating that in ways that capture everyone’s imagination and empower individuals to move forward, no matter what the prevailing economic climate.”
But, he adds, leadership focus shouldn’t just be directed at the top level of the organisation. “Leadership takes place at all levels. So the key strategies to focus on are to include some aspect of leadership in everybody’s development plans. That way everyone knows what to aim for if they are in leadership role and equally, they will know how to recognise leadership when they are in follower role,” says Gaunt.
NZIM’s Management Competency Model is, he says, good starting place for an organisation wanting to identify what to focus on. There are five key attributes of leadership identified in the model.
The first is the one described above – the ability to come up with an empowering strategic vision. The second is self awareness. The more leader is self-aware the better his or her decision making and the more likely they are to benefit from continuous learning and development.
The third is the ability to be comfortable with ambiguity. Leaders must be able to see the situation for what it is, cut to the chase and not get lost in the complexity of the everyday environment. “They need to have high expectations of themselves and others,” says Gaunt. “These need to be reasonable as well as high. This acts as ‘pull’ for performance.”
Finally, potential leaders should be positively persistent. “It’s bit like the squeaky-wheel syndrome,” says Gaunt. “If something needs doing and it is not picked up they keep trying different approaches until someone sees what is needed and gets on with it. Being placed in situations requiring leadership and having effective feedback is one of the best ways to develop leadership skill. Going on good outdoor experiential leadership development programme is an excellent starting point. Giving 360 feedback on leadership behaviours is another excellent way of building leadership capability.”
It is not, in Gaunt’s mind, wise to throttle back on leadership development in difficult times. “Leaders are needed throughout the organisation,” he says. “You can’t just put people on course and then make them leader. And you can’t predict how well someone will develop as leader. You have to keep putting the investment in and wait to see what comes out. Throttle back and you lose out big time.”
Gaunt’s point was picked up by the BusinessWeek/Hay survey. “The best companies for developing leaders recognise the value of strong leadership in both the good and bad times,” said Larrere. “Culturally they just cannot do away with leadership development, even in recession. They don’t see it as perk but as necessity.”
Does Gaunt think NZIM member organisations and others understand what is meant by good leadership development initiatives?
“The answer to this,” he concedes, “is mixed bag. Larger organisations tend to see the need for leadership development programmes and have the resources to invest in them. However, 90 percent of New Zealand businesses are fairly small and don’t have the time or resources for big leadership programmes. NZIM and some other organisations can, however, provide leadership development at reasonable cost that suits the needs of both the large and smaller businesses.”
But Gaunt isn’t sure that enough organisations really understand what developing leadership culture really means. He suspects too many organisations think leadership is about command and control. And he’s equally sceptical about those that profess commitment to leadership development.
“Sometimes you see organisations appearing to walk the talk but all they are really doing is jumping on one of the latest band wagons,” he explains. “Experience tells me that the CEO must own the leadership development strategy for the organisation. Then it becomes real and focused on what is needed rather than on what consultant or human resources manager thinks is needed.”
Leadership in the top companies’ survey apparently “feels different” according to the researchers. More than 64 percent of respondents from the Top 20 enterprises said people in their companies were expected to lead even when they were not in “formal position of authority”. At other organisations that figure hovered around 35 percent. And respondents from the Best Companies for Leadership were significantly more likely than those from other companies to believe they will emerge stronger from tough times.
Respondents were also asked about their companies’ current focus. Among all the respondents, 65.1 percent said they were “positioning for the future”. Among the Best Companies that figure was 81.9 percent.
Gaunt is not convinced that significant number of New Zealand companies are now positioning for the future. “I just don’t see strong evidence of this,” he says “except perhaps with large corporations. But even then, it can often be more theoretical than real.”
So given the research and NZIM’s own market observations, what are the organisational characteristics that signify leadership focus?
There are, according to Gaunt, some very clear characteristics. Organisations in which people look for improvement and innovation is noticeable one. “That suggests the whole organisation has made step change,” he adds. “Why? Because people are not struggling to work out where the organisation is heading and where they fit. They are clear about the vision and because of that are empowered to work out for themselves how to get there.”
This, says Gaunt, allows individuals to move up the scale to higher level of operation – which is around improving and coming up with new ideas. “I think 3M was very good model of this worldwide few years ago. Perhaps Google is today’s example.”
Leadership is vitally important for any manager today, says Gaunt. “However, much of the written theory and many development programmes are based on outdated models of leadership and are often not aligned with the real needs of today’s fast-moving world.”