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How to run an effective leadership development program

8 min read
Whether it's preparing the next generation of leaders, or helping your current executives to do better, a leadership development program is a pivotal part of any performance management system. Here’s how to get it right...


Why run a leadership development program?

Why do you need a leadership development program? Because research has found that 93% of managers felt they lacked the necessary training to do their jobs well.

And what’s more, managers account for some 70% of variance in employee engagement. This means that having great managers helps drive engagement across the organization.

Reduce attrition: According to SHRM, 55% of managers or employees in the US (i.e. a rung below leadership level) are considering other opportunities; demonstrating career growth opportunities helps you retain top talent

Retention: 86% of people who say they have a great deal of opportunity for career progression say they’ll stay at their company

Engagement: globally, 2 in 5 are dissatisfied at work, while over 50% of US employees are ‘not engaged’; developing leaders is one way of improving engagement

Growth: with only 1 out of 3 leaders looking for a new job, how do you ensure leaders don’t stagnate at your company? How do you promote continuous personal development?

Continuity: an LDP helps you instill your company’s values in the next generation of leaders, whether it be formal succession planning or more general training

Talent attraction: if only 1 in 3 leaders are actively looking for a job opportunity, your talent pool is much smaller; you need to differentiate yourself by offering something to leaders other rivals don’t

To sum it up, a leadership development program is an essential part of the employee experience.

How to set up a leadership development program

Step 1: Set objectives and understand your company’s priorities

No two organizations are the same, which means your reason for launching a leadership development program will be unique. It’ll depend on where your company is right now and where it sees itself in the future:

  • Are you in growth mode? You need leaders with drive, ambition and great ideas for advancing the company
  • Are you in cost-cutting mode? You need leaders who are flexible, resourceful and able to communicate effectively
  • Are you struggling with retention and engagement? You need leaders who inspire, communicate effectively and can drive behavioral changes

Understanding your company’s priorities and how they align with the capability & training needs of your leaders will allow for greater opportunities to target these needs within the context of your program.

Step 2: Define leadership and its main qualities

Once you understand your company’s current priorities, you can define what leadership means to your organization and what it will look like in practice.

Leadership roles are typically defined as those that are integral to a company executing on its grander strategies. Whether that be inspiring team members, growing awareness in the market, or helping employees succeed. You may limit your focus to those with formal leadership roles, or look further afield to those who have a lot of influence but not the corresponding job title.

Consult your leaders and high potentials, too. Publish a short survey asking them what they consider important leadership qualities for the company to succeed.

However, don’t just rely on expertise within your current leadership group. This can lead to the same ideas, behaviors, and qualities circulating again and again, and can prevent an organization from growing. This is especially true in older organizations, where there can be a tendency to do things ‘as we’ve always done’ and hire people ‘who fit in’.

Step 3: Audit your current leadership against the criteria

Once you’ve agreed on a set of leadership qualities, you can compare your current crop of leaders against them.

One way to assess your current leaders is to run 360 Feedback reviews. This helps you get a fuller picture of whether they’re demonstrating leadership qualities to their peers, direct reports, and own managers. It’s why more than 85% of all Fortune 500 companies use 360 Feedback.

However, you should compare leaders’ scores against the top 10% surveyed, or a high industry benchmark, in order for leaders to feel motivated to go further. By just looking at average scores, there’s a risk leaders might be lulled into thinking they don’t need to do very much to succeed.

Step 4: Plan and implement a wider leadership development program

Even after 30 years, the most popular structure for leadership development programs remains the 70-20-10 rule. That is:

  • 70% on-the-job learning, with challenging assignments and opportunities
  • 20% mentoring, where other leaders share their expertise
  • 10% training, that challenges and stretches them

Most business schools agree this mix of learning methodologies matches the mindset of most leaders, who’d prefer autonomy and responsibility over sitting in a classroom learning how to lead. However, not all experiences are created equally.

It’s important to identify the experiences that offer the most learning. This should be based on their individual needs.

For high-potential leaders, or those early in their careers, you could consider rotational programs. This is where employees spend time with different departments, learning a variety of leadership skills and getting a better understanding of how the business units intersect and collaborate.

You should involve your senior leaders in the process of building training and experiences. They’re the ones most able to articulate where the company should be in 5, 10 or 20 years, and help the next crop of leaders succeed within that framework.

Step 5: Create personal development plans with leaders

For your current crop of leaders, you can create personal development plans tailored to the specific qualities they need in their role and their current strengths and weaknesses. These plans should facilitate personal growth, not be seen or used as corrective measures.

If you’re lucky to have extremely talented leaders, emphasize the importance of building on strengths. Standing still means getting overtaken at some point, so leaders should focus on remaining at the top of their field and being a beacon for other employees in their organization.

Step 6: Monitor and measure

Like any program, you need to measure its effectiveness and the ROI. But also remember that for leaders, autonomy and trust are two of the key drivers to job satisfaction. So how do you meld the two requirements of trusting leaders and monitoring their progress?

One way of doing it is having the leaders in the company act as mentors, giving advice and feedback on the progress of more junior leaders. All with the subtext that one day the more junior leader could be a mentor themselves.

You can also leverage 360 feedback to understand how the leader is developing in the eyes of their colleagues. Do direct reports notice a difference? Do peers recognize emerging leadership qualities?

Step 7: Don’t just listen, act

It’s crucial that feedback is actioned. An employee needs to be given resources to help them if they’re given poor feedback in a particular area.

A lack of follow-up around what happens after going through feedback means that the process becomes pointless. It will also damage future attempts at carrying out effective 360s as employees will be apathetic about how useful it’ll be.

Want to find out more about 360-degree feedback?

Download the ultimate guide to 360-degree feedback