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Leadership Development – Roundtable Report

20 March 2012     London
Hosted by theHRDIRECTOR.
Chaired by Jason Spiller.

Florian Bosch
, Head of Leadership Development UK & Ireland – Telefonica o2
Carolyn Dyer, Human Resources Consultant – Standard Life
Carole Edmond, Managing Director – Bright Horizons Family Solutions
Richard Hale, Professor of Management Development – International Management Centres Association
Gill Martin, Head of OD & Engagement – PRS for Music
Nikky Sanwo, VP of Finance and HR – JRI Europe
Marissa Starkman, HR Manager – Nicoll Curtain Technology
Jane Williams, Interim Head of Reward & Pensions – Post Office Ltd
Sharon Williams, Director of HR – Bright Horizons Family Solutions

Reported failures of leadership may have shaken confidences, but were they really the catalyst for the economic downturn and does the spectre of recession cast a shadow over traditional models of leadership development?

A leadership development strategy must be founded on the values of a business as a fair practice operator. The exemplars of this are leadership teams that are represented by a diverse range of people and there is much evidence that such diversity is combining to deliver leadership that is well grounded, agile and adaptable, as well as consistent, innovative and pragmatic.

How has the traditional leadership model failed and what must we learn from this failure to avoid such mistakes being made again?

Jane Williams: Traditional leadership models, to a degree, have struggled with the challenges of the economy. For example, where the situation is without precedent and there is no real agreement on what is the best route out of the problem.

Richard Hale: The model of educating leaders is a broken one, i.e. the testing of intellectual ability in a case study environment and actually pushing them into top leadership positions. I am not the first person to say this, I can cite, for example, Henry Mintzberg, who has drawn this conclusion. Leadership development should be about encouraging people to work on “real” leadership issues and challenges, not just intellectual ability in case study scenarios, which are often outdated, and is a flawed approach in today’s environment.

Sharon Williams: I agree, we need to approach this differently, the world is changing we need more agility and the old methods are failing to deliver what businesses need. We have been using an action learning approach for some time and getting a group of people together to work on real business issues has been fascinating, and we have quickly seen the benefits.

Marissa Starkman: I wouldn’t say that the traditional leadership model has failed us outright. Leaders are finding themselves in unchartered waters, facing a deluge of challenges, expectations, and potential opportunities all at the same time. These situations are not found within MBA classes and textbooks. Nobody expects leaders to get it right 100 percent of the time, but it’s how they handle themselves in those situations that counts. We need to stop focussing on the leadership model and focus more on the individual, ensuring they are supported, challenged and held accountable for their decisions and subsequent results. We are moving in that direction.

Have leaders lost respect?

Florian Bosch: Not a loss of respect, more a loss of trust. Once the topic on Boardroom failures was opened up by the newspapers, every employee started wondering about their own leaders. Rebuilding trust in leaders is the main piece that businesses need to work on in the future.

Carolyn Dyer: I think that’s really key in financial services, particularly because of the whole RBS and Government debacle.

Jane Williams: A typical recent example of leadership being held to account is the Cypriot Government’s decision to raid their citizens bank accounts, to bail the country out of debt. How could you possibly suggest this in a democratic society, as a potential solution, without losing credibility or trust?

They say anybody can be a leader when things are going well, it’s when the chips are down that poor leadership is exposed.

Richard Hale: My view is that leadership is in crisis, I don’t know how we can say it’s not. Every institution that we have been conditioned to respect, whether that’s the Government, public sector or financial sector, have repeatedly demonstrated a crisis of leadership. And I wouldn’t go as far as to say that we can point the finger at the media in terms of this. In terms of the psychology, my approach is very much a practical, pragmatic one, in terms of leadership development. We should be focusing on giving people opportunities to work on real leadership challenges and to use those as the basis for their leadership development, giving people real leadership opportunities to work on.

Nikky Sanwo: What was previously acceptable behaviour is no longer acceptable; people are more open to challenging leaders and holding them to account. Leadership is more about being collaborative, transparent and being able to influence others, rather than being authoritarian.

Sharon Williams: I don’t think you can just focus on leadership, it’s about culture in organisation and the politics that play out within the organisation.

How are the changes in the employer/employee relationship, changing the way leaders lead and how they are perceived by the workforce?

Gill Martin: Many leaders are struggling to find the right approach in a rapidly changing and transparent world. A command and control approach or a paternalistic culture, however benevolent, is no longer effective.

Jane Williams: Leaders increasingly will have to be accountable, they are far more likely to receive criticism on their actions, there’s greater discussion with stakeholders to determine the right decisions and the concept of the stakeholder group is much broader and, of course, there’s social media, issues can go viral almost instantaneously. So what is happening is very powerful and will force the need for change.

So if the traditional leadership model has failed, what does the new model look like?

Richard Hale: We could probably plot shifts from the model of the “great man” theory, through to situational leadership, to transformational leadership. What we have seen and experienced recently does throw up the question, just what is the appropriate model going forward? I think it is multifaceted. You can look at this from the perspective of, what is the style of leadership that’s appropriate? You can look at it from an organisational perspective, what is the organisational culture that leaders need to try and develop, and you can look at it from the development perspective as I tend to; how do you develop effective leadership?

Nikky Sanwo: It’s impossible for one person to have all the necessary qualities of a leader. So collaboration with people with different strengths, a team made up of individuals with the right skills, seems to make a great deal of sense.

What are the key considerations when recruiting with future leadership in mind and what are the key credentials to watch out for in candidates?

Carolyn Dyer: In the past, many organisations recruited “a type” of leader; male, white, over 5’10” father in the military. Now there’s much more societal openness to diversity in its broader sense, so that in itself is challenging for leaders, thinking about Generation X and Generation Y, thinking about the digital traveller, about what our younger people need from leaders, I think it’s changed tremendously.

Florian Bosch: We have shifted from a major knowledge and skill assessment, towards a greater emphasis on the behavioural part. We assess our leaders in five dimensions: First, global, how globally do they think and act? Second, digital, do they act as ambassadors of the new digital reality? Third, customer, have they a clear understanding of our customer base? Fourth, agile, how quick can they make decisions and hold themselves accountable. Last, do they role model these behaviours sufficiently?

Marissa Starkman: We have taken a slightly different strategy recently. While demonstrating success is important, it should only get you past the first hurdle of the hiring process. Moving beyond success, we need people that are adaptable, inspirational, and extremely agile. No longer will the top salesperson ensure a team’s success, the competitive landscape is calling on more from our leaders than just being good at what they do.

“Empathy” seems to be a word that comes up increasingly, in terms of leadership qualities.

Marissa Starkman: Empathy and the softer traits of leadership are important when it comes to predicting emotional intelligence; a real buzz word at the moment and rightly so. However, as you can imagine, there are many managers who are extremely influential and successful who do not possess empathy, but are still able to motivate, inspire and lead. There is still the requirement for traditional leader types, but with the challenges leaders and businesses face today, “traditional” leaders might not fit the full bill.

Carolyn Dyer: Paramount to leadership is strong integrity, most pertinent in the financial sector, and we have made sure that we don’t have a star culture in our organisation.

Gill Martin: Changing the model of leadership is challenging for everyone. We talk about leaders needing a different approach, for example the ability to show vulnerability and ask for help rather than being a hero-type leader. But when you have long-serving employees, who are comfortable with the old ways, it doesn’t necessarily encourage leaders to change their behaviour. So they recruit in their image and perpetuate a style and culture of leadership.

Recruiting in one’s own image, does this really still happen?

Gill Martin: I think it still does. You can have the most rigorous of recruitment processes, but there is no fail-safe method, whatever test you do in terms of recruitment.

Carole Edmond: We talk about inspirational leadership, passion, agility and capacity to manage change. These are broad contexts and every business is different. So what might be required in banking will be different to, say, early education and care services. Purpose and context has enabled us to recruit with alignment to our organisational purposes and the business needs. The leadership model is not just about senior leadership, and we’ve seen real transformational change where we’ve tried to move to a much more distributed leadership model, to leaders at all levels, recognising that senior people do not have all the answers, and moving away from an overly-prescriptive command and control approach.

And there are accidental leaders too, that make leadership positions via their capability and knowledge, as opposed to their ability to manage people. That must have had an impact on many businesses.

Richard Hale: I started my career in the engineering sector, we recruited graduates and apprentices into engineering-related roles and, by definition, these people were very technical, and they were taking on supervisory roles quickly. So we ended up actually having conversations with the universities, to ensure that they started building into the engineering degrees, aspects of leadership development and management development. This worked and so I think early collaboration between business and educational institutions is a real positive.

Jane Williams: An impact on the leadership model is diversity or inclusivity which affects resourcing directly. The challenge is for leaders to mirror the customer-base with their employees, to bring in those with a broader experience of different cultures, for example.

Florian Bosch: To create an environment where this future leadership culture can evolve, we need to think from an organisational level first, establishing a culture of regular feedback and transparency. We need to support from an organisational level first. We have introduced flexi working as one supporting mechanism, but also we expect our leaders to contribute to this new world of working, hold great conversations with their teams and be open to feedback.

Trust is hugely important because people are now often out of sight.

Florian Bosch: Absolutely! And to take this even further, leaders need to broaden the conversation and start talking about themselves, their mission and purpose as leaders.

Carole Edmond: A framework is important so that people feel secure, as well as engagement and wellbeing.

Sharon Williams: I agree it’s creating a framework, trusting people, and an environment of ownership.

Carole Edmond: We are in a very regulated market in childcare and so it is very policies driven. So we have worked hard to simplify the delivery of policies, and this has built confidence and maintains responsibility.

What is the best way to monitor, test and assess potential leadership development groups to see whether they are compatible and can perform as a potential leadership team for the future?

Nikky Sanwo: Bringing people together on projects outside their comfort zone goes beyond technical capability, and really exercises communication, interpersonal skills, influencing each other and sharing ideas.

Richard Hale: I utilise that very model; take a group of people from different parts of the business, give them a real-life challenge, and allow them to work on addressing that issue over a period of time. Choose a Leadership Question – take a problem or a challenge – and turn it into a question, in an action learning way and the learning will follow the issue, rather than starting by trying to teach aparticular leadership topic. Hopefully, they will form into a team, and I would not over-engineer it, in terms of how you put the team together. In large corporates, we form many of these throughout the organisation, so it creates a sense of cutting across the traditional hierarchal construction. And there’s a valuable bi-product too as it builds relationships which could be very useful in the future. There are some great things that happen; for example, people who really demonstrate leadership through action and show this to the organisation. Some of these people may have been showing leadership qualities outside of business, coaching football teams for example, and they then show their management skills in the action learning context These aren’t always the people who sail through the psychometric tests, but equally there are some people who have passed the psychometric tests who actually don’t demonstrate great leadership.

What does that tell you, that psychometrics can’t be trusted?

Richard Hale: Well I would just put that into They may provide part of the picture, but the real test is actually what do people do when they’re put on the playing field?

Jane Williams: When you design an assessment centre or use psychometrics then the purpose is to predict how people will behave. Intellectual skills may be very important, but it is often the leadership model which surrounds them which determines their success.

Carolyn Dyer: It’s a case of understand what you’ve got, everyone’s unique and psychometrics can bring you in some great potential. But that potential can only be maximised through the quality of development, which will drive engagement and maximise potential.

Carole Edmond: Psychometric testing was developed with the old world in mind, it’s hardly relevant for the kind of skills and attributes needed, and the speed at which we work and think today. I’ve seen people that have been through psychometric tests and, on the data, frankly you wouldn’t give them the job. Ignore the data, and create the environments where line managers, who actually are predisposed to get the best out of them, and they’ll achieve way more than you or they would have thought possible. Conversely, I’ve seen people sail through those tests and just can’t hack it in the role, haven’t got the resilience, the passion and the determination. So I would be concerned with, certainly an over-reliance on psychometrics, perhaps they are more relevant in some sectors than others, but certainly that’s our experience in our business.

Nikky Sanwo: It’s important to understand when it is useful in the recruitment process. At that stage, we are evaluating the candidate’s potential, but people change. If you’ve got the right dynamics, a good manager who is quite inspiring and who actually nudges you, stretches you, works with you, can get the best out of the individual. If you have a high score but a poor relationship with the manager, the talent is going to be out of the door fast.

Jane Williams: I agree, and it’s the allegiance to the company as well, how people relate to their organisation, which is also a very powerful dynamic.

Florian Bosch: The key for me, with regards to psychometric tools, is that we should not use them to tell people how they behave, categorise them into groups, but to offer them a tool to help them gain a better understanding about themselves to raise their self-awareness.

Carolyn Dyer: I worked in psychometrics for a long time so I’m probably pretty biased, it just gives you a better understanding of what you’ve got to work with.

Gill Martin: They certainly heighten people’s self-awareness, particularly if you’re in a situation where, maybe you’re not getting feedback. It’s how you present it, and it’s what’s comes out the other side. It’s not right or wrong, and I think it’s very much about interpretation. Most importantly, it should never pigeonhole people.

Jane Williams: Managers I worked with thoroughly enjoyed these processes and tools because it was based on an objective sharing of information, between candidates and the employer, they really had more productive discussions with people with the increased understanding of individuals that psychometrics achieved.

Despite a strong business case for gender diversity in leadership, statistics still demonstrate that women are under-represented on Boards. How can this be rapidly reversed without resorting to damaging implications of positive discrimination? Is enforced quotas really the best way forward?

Carolyn Dyer: We get boxed into thinking gender equality is the only diversity issue, but it is of course much wider. Diversity is much broader than the traditional understanding of meaning, it’s about diversity in attitude, values, strengths, and that’s to be highly valued.

Jane Williams: In Scandinavian countries, where they’ve had quotas for longer, they have got a higher percentage of women on Boards. But quite frankly, I think it’s a crude tool, but there seems to be no other way of changing the current leadership profile. I agree, it’s about the full range of an inclusive society across all spectrums.

Sharon Williams: If you focus on the numbers and the box ticking you’re not going to get the right outcomes. Quotas are unlikely to achieve the outcomes we are all looking for.

Florian Bosch: Long-term diversity will only be achieved if employers focus on supporting women at the very start of their careers, not just at senior management level, to create a pipeline of talent.

Carolyn Dyer: We tend to look to employers for a solution. It’s more for me a question of the system, education and society at large.

Carole Edmond: It isn’t about quotas, it’s about having the culture and set up that enables women to have a family, without compromising a career, and that means full inclusion and flexibility. It’s a win-win for organisations who then don’t lose the talent they have invested in.

Things are changing though: shared maternity/paternity leave, more regulations on equality and inclusion, flexible working, greater work/life balance. It’s a changing culture.

Carole Edmond: If you look at the research that was done on FTSE companies, it would suggest that the pace of change is too slow, even in 50 years there will be nothing like parity. There needs to be a complete mindset shift.

Marissa Starkman: Again, it’s back to culture and leadership, and one which challenges you and sets high expectations. However, having a manager who sees you as a subordinate to execute work, will most certainly not see you as a future manager and effectively hinder your ability and progress.

Carole Edmond: Even though female attainment is higher than men in education, the whole socialisation piece kicks in which is, women shouldn’t expect to achieve as much as men from a career. There is more to this than the reform of childcare.

Florian Bosch: These examples show patterns existing in the heads of leaders, ultimately it is they who need to challenge themselves, to break those patterns. Plus the importance of role models cannot be overlooked.

Marissa Starkman: In the professional services industry, it is not always practical to have working from home and other flexible arrangements. There are other ways of going about implementing these changes but again it comes down to the individuals you have in the organisation and what you are trying to achieve. Businesses need to think hard before they decide which elements of flexibility to implement.

How has a reward for failure culture altered the perception for reward and remuneration and what is best practice in setting the parameters in the future?

Carolyn Dyer: Best practice is key, it’s back to this question of how much do you regulate and how much do you trust people, and having the right system. I don’t think over-legislating is a solution, that suggests problems run deep. Increasingly, it’s the shareholders whose opinion matters, and they would not countenance exceptional payments that can’t be justified. And the general the public are well-informed of the impact of reward practices. Let’s face it, with the tax payer having an 80 percent share of RBS, that’s unavoidable.

Sharon Williams: Reward strategy needs to be aligned with the business strategy and be rewarding for the right behaviours.

Carole Edmond: Reward and remuneration should run through the entire organisation, not just with the senior people, and it’s about consistency and not just based on performance, outcomes and results, creating a long-term, sustainable organisation with the right values and behaviours.

Jane Williams: The crash has rung changes in terms of alignment of executive reward across the organisation. There is a much more integrated, aligned approach to remuneration and there is increasing accountability of the listed companies, in particular to shareholders who are becoming much more prevalent in the dialogue.

When leaders have to justify their reward and remuneration, then they’ve effectively lost the crowd, and the game.

Jane Williams: I read the CEO at Lloyds TSB recently waived a bonus until the actual share price reaches a level at which the public is getting a return. For me this shows accountability, the right action, as this organisation is stewarding public assets, so this is a real move forward.

Nikky Sanwo: Accountability and transparency are really fundamental, having a reward policy that’s exactly the same throughout the organisation and it’s not just for team performance and the result of the organisation, it’s about rewarding good behaviours as well. So everybody knows what they are being rated against.

Richard Hale: It’s easy to get focused on just the people at the very top, it relates to leadership at all levels. Where you expect to see certain leadership behaviours, you focus on and define clearly those behaviours and hopefully you create a culture rather than just focusing on the people at the very top. I’m less concerned with the big news headlines and more concerned with what’s actually happening in the organisation.

In light of the recent abolition of the DRA, in consideration of the rapidly changing workplace, how can employers best develop leadership potential that engages all generations in the workforce?

Sharon Williams: With Gen Ys entering the workplace and people not retiring at a finite age, we will have to think more creatively about how we design roles and give even more consideration to flexible working patterns, to accommodate this more diverse workforce, and the opportunities we will be able to create for people.

Carole Edmond: Age is only a number and to a great extent it shouldn’t really matter, it’s about how we place people and make career development a constant. There is the wider social issue, that there is not the money available to support our aging population and so it’s going to be a combination of employers thinking about how they can work flexibly to keep people in the workforce. A key consideration is, if they have caring responsibilities, providing support is a very real issue for employers and I don’t think many have made the connection, but inevitably, they will have to.

Carolyn Dyer: For businesses that get that in place effectively, it will be very good for the employer brand. And I agree, for all organisations, it’s going to be incumbent upon us to think about how we manage that.

How do we ensure that the aspirations and objectives of the business are aligned with those of the leadership team?

Florian Bosch: It comes back to communication. Is everyone familiar with the business’ vision and objectives? And this is more than simply putting it on the Intranet and hoping someone will read it.

Sharon Williams: We have a really simple visual that describes our ten year strategy, and we shared that across the organisation and aligned it to everything: the purpose, vision and mission etc. The workforce really bought into it, providing a clearer line of sight and connection.

Gill Martin: Communicating where the business is going seems more of a challenge when it’s often constantly changing, due to external pressures. Delivering a consistent message can be difficult for leaders. Consistency is important; the senior leadership needs to be on the same page, about the higher purpose of the organisation.

And leaders need to be linchpins between customer needs and expectation, the relevance and quality of the product/service and the delivery by the workforce.

Carole Edmond: Absolutely, customers drive demand and that’s where the creativity and agility of being a learning organisation is crucial, being a more agile learning organisation.

Richard Hale: That’s where action learning comes into play, people working on problems rather than puzzles – real challenges to actually address some of those business issues and how to tackle issues or make improvements, and this all feeds up to a steering group at executive level. This is key to really mobilising your strategy, in order to help you meet the needs of customers, as well as the vision, in a very practical way, which also neatly, genuinely engages people.

When leaders become iconic, their departure can leave a huge gap. Steve Jobs being the most prominent recent example.

Florian Bosch: We have discussed evenly distributed leadership, and we do need to think beyond an iconic leader, and that will create more great leaders on all levels.

Jane Williams: I think that the importance of the individual leaders will be less prevalent in the future and what will become much more prevalent is the quieter, lower profile leader backed up by a strong team and indeed, there are already leaders in successful businesses that do fit that profile.

Carole Edmond: Often they can be counterproductive, and I think the days of the iconic, charismatic, heroic leader are gone, and that is in line with the re-defined engagements, those being less about personal reward and ego building.

Marissa Starkman: With Gens X and Y, we might see a paradigm shift to being more about vision, mission, values and culture, rather than how dynamic a leader is. Increasingly, people are looking for increased work/life balance and progressive business environments. Employees should have a healthy interest in how the ship is being steered, and this will boost the employer brand and its attraction factor to talent and high performers.

What is the action learningbased approach and how can it be used to transform leadership potential and performance as a strategic development programme?

Richard Hale: It’s about people learning “ with and from others”, often peers, in a social learning set. It challenges some of the traditional models of education and learning, which are top down and didactic, and it’s appropriate when you’re having to address organisational problems, where there isn’t an obvious place to go for the answer, such as a university or a text book or a particular authority. So it’s a group problem-solving process on one level. What differentiates it from straightforward project management is that it’s also about learning, as well, and people learning through their activities within an action learning set. There are examples of action learning failing in some organisations, and I think that’s due to what is actually driving the impetus for action learning. In some organisations, it’s tacked on to training courses, or a leadership development course or programme, rather than being embedded in a real business strategic issue or challenge. So it becomes more of a kind of self-help group, a little bit of group therapy. For it to have real impact in my view, it needs a system. I call it Action Learning Questions and the Bright Horizons people here will know my interpretation of this because to some extent they’re using it. It does have a role in the world that we now exist in, but we can’t plan and predict what our business is going to look like in five years’ time. So for me, training courses are appropriate if you are dealing with a skill where there’s a known way of doing it and you need to teach it. Action learning is appropriate where you’re dealing with the unknown and dealing with problems rather than puzzles, so yes, it’s absolutely relevant, more relevant now than ever actually.

Does it run lineally, organically, is it modular, or do you have a general idea of where it may go or does it sort of develop itself?

Sharon Williams: For us, it was important not to see it as a new fad, a new initiative or an HR tool. It was important that it became part of the organisational DNA, it’s part of how we learn as individuals, as teams and as an organisation. We have integrated action learning into other business process, for example job performance appraisal etc. One of the challenges has been around getting the time out from the day job to actually discuss the issues. It has been a game changer for us as an organisation. It just removes the barriers, moving away from just ticking the box, to being more creative and more thoughtful, taking time out to reflect etc.

Carole Edmond: I think it has been transformational for us in terms of getting leaders to think more about learning. It’s that learning vulnerability, and it doesn’t matter how senior you are, we can always learn and reflect, and say we haven’t got all the answers and that’s opened up a level of engagement and empowerment for people.

Jane Williams: It is important for organisations to manage their future as well, giving themselves enough space to look ahead and assess potential opportunities or market threats which could endanger their future.

What are the key considerations in providing support and a holistic approach to ongoing development, and what are the key considerations in managing leadership wellbeing and what are the most effective interventions to ensure the leadership is well supported by the organisation?

Carole Edmond: Organisations must see people as people, and think about them in that broader, holistic sense. The more that we’ve taken that approach, the better the performance and the relationship, rather than just being fixed on how people can be used to deliver the bottom line.

Sharon Williams: Wellbeing intervention is very individual what is important to one individual, may not be important to another, and so it really cannot be handled in a one-size-fits-all approach.

Jane Williams: I think that every manager has a responsibility for the wellbeing of the people that work for them. It is getting this philosophy integrated into the culture which is important.

Marissa Starkman: Companies are going to take a deeper look into how they support employees through flexibility, benefits and overall working life. It seems Generation X and Y are looking for something bigger than themselves to be a part of and it will be very interesting to see how businesses balance this alongside the core business strategy.

Richard Hale: Leadership is something that now has to work at all levels and we can become preoccupied by focusing too much on the one person at the very top and so this, action based learning model is a way of developing leadership throughout an organisation.

Gill Martin: This is an interesting model. But I think the challenge for many businesses that have a strong leader at the top, is how you make that shift.

Sharon Williams: I think it’s just about encouraging organisations to think differently about leadership development.

Florian Bosch: What is very clear is leadership development needs to be about the heart as well as the mind.

Jane Williams: Leadership should take account of the “complete” person who comes into work. The big challenge is these tough times, businesses are struggling and this can easily slip off the agenda.

Nikky Sanwo: Clearly, it is inappropriate to think of leadership relating to just those at the very top, when it should relate to every member of the workforce.

Carolyn Dyer: Leadership is about having followers and, on any scale, that is a big responsibility. It’s about real care and attention, we need to have good role models of great leadership, right across business and at all levels, especially in this time of challenge and change.

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