Expectations for future leaders have changed in the last decade.
Before, a CEO with a grand vision and effective people management skills was sufficient. Now, leaders need to present bold ideas, motivate employees, and network with other leaders.
The Struggle In Finding And Choosing Future Leaders
According to Deloitte's 2016 Global Human Capital Trends report, 86% of 3,300 business and HR leaders cited leadership as a "very important" or "important" issue in their organization. But there’s a huge gap in many organization's capacity to fill leadership roles. Only 6% are confident their leadership pipeline is "very ready," while 51% either have a weak succession plan or nothing at all.
As organizations move from rigid hierarchy to a flatter network of teams, companies are now forced to look at leadership skills in a new light.
What Companies Look For In Future Leaders
1. Potential Over Performance
Star employees don’t always have the skills to operate well in a leadership position. Focus on high-potential employees instead.
What makes a high-potential employee? Its definition depends on your corporate culture and priorities. What’s more important is you have a clear way to distinguish them.
Anthony Abbatiello, Principal of Deloitte Consulting LLP and Global Leader of Deloitte Leadership, says, "Deloitte focuses on four factors of potential, which are innate and hard-wired to the person.” These factors are “people, intellectual, change and motivational potential,” adds Abbatiello.
How can you tell if an employee has high potential?
Dig deep through their career and personal lives. Conduct in-depth behavioral interviews and reference checks to discover if your chosen candidates have these qualities.
2. Commitment To The Company
While some employees just mind their own tasks and deadlines, committed employees go above and beyond — not just to look good, but out of genuine interest for the company’s future.
Center for Creative Leadership surveyed 199 high-potential employees and found that 95% of participants were committed to their organization and 96% were motivated by their jobs.
Pay attention to employees who care about your organization. They could be the future leaders of your company. Invest in their career and training, so they don’t leave in search of better opportunities. The more you invest in their future, the more you bind them to the company — whether out of gratitude, career satisfaction, or an intrinsic feeling of belonging or connection.
3. Initiative And Self-Direction
Do senior managers lounge around doing nothing? No. The same goes for aspiring leaders. They can do their job without too much hand-holding.
Matt Moog, CEO of PowerReviews adds, “High potential employees go beyond what’s asked of them. They solve problems, create opportunities, and improve the efficiency of their own functional area.”
4. Ability To Learn
CEB’s Global 2014 Talent Report for High Potential notes "ability" as one of the prime indicators of high-potential employees. However, their description is too broad.
Joey Price, CEO of Jumpstart:HR, narrows it down to the ability to learn. “The ability to learn and interpret information at a fast pace is the number one trait for next-level leaders,” he says.
Many of the jobs today didn’t exist a decade ago. Organizations need leaders that can adapt to new technology and other external forces.
5. Fearless Decision Makers
Jill Larsen, SVP of Strategic Talent Acquisition, People Planning and HR Services at Cisco, says her company “looks for leaders who aren’t afraid of taking risks.”
But there’s a catch. For Cisco, the right leader is also agile in correcting course in case their decision led to the wrong path. Integrity is a big factor, as it’s dangerous to have a leader who hides his mistakes to the organization.
6. Excels In Uncomfortable Environments And Stretch Goals
Pushing talented employees up the corporate ladder will help them grow. But it won’t prepare them for the rigors of a leadership position. New environments and stretch goals will.
Todd Thibodeaux, President and CEO of CompTIA, says, “We like seeing how rising stars operate out of their comfort zone. Given the task of organizing a cross-organizational initiative, can they build a team, define objectives, deal with adversity, and still deliver?” He continues, “Observe how and from whom they seek help when challenged. What kinds of questions do they ask? How do they make adjustments, build consensus, and stretch themselves.”
The outcome isn’t as important as the process. Of course, meeting the metrics increases the employee’s appeal as a future leader, but attempts to game the system is a bad sign.
Eric Kaufmann, President of Sagatica, shared this example of a stretch goal. “A VP of HR was asked to create a process to help the CEO shift its company culture from engineering to a customer-centric culture,” he says.
The VP had to build political trust with other teams, create programs explaining the pros and cons of the change, and get the buy-in of several VPS and C-suite members. The stretch goal forced him to leave the processes he knew, and exercise his influence, while building relationships and inspiring others.
7. Collaborative And Feedback Seeking
Moog says, “Our leaders need to excel at collaboration. They must value diverse points of view.” Look for employees who respect negative opinions, and are always ready to address criticisms co-workers throw at them.
8. Team Builders
A team’s diverse opinions, skill sets and backgrounds don’t hinder a true leader. It’s an asset that lends agility to the group. As a result, employees love working with them.
How do you know if a high-potential can lead a team? “One gauge is the number of former employees that worked for that person many times,” says Larsen. Conduct reference checks to see how many of their former co-workers and subordinates would love to work for them again.
Evaluate Your Leadership Programs
Blindly throwing money at leadership programs doesn’t work, as shown by Deloitte’s last report. Use a clear criterion and structured process for identifying high-potentials. Base the selection on hard data — not on who is next in line or most liked by the team.
While this list is a good starting point, customize it according to your organization’s current needs. Examine your current leadership development program. See if it’s delivering the ROI you’re looking for then make the changes from there.
