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At Goodyear, today’s leaders queue up to train successors.
In 2010, executive team members at Goodyear North America asked, "Who in North America has the potential to take on top business and functional leadership roles in the next two or three years, and what are we doing today to prepare them?" It was up to the HR department to respond.
Goodyear North America, a division of Goodyear Tire & Rubber Co., manufactures original equipment and replacement tires, related products and services, and chemical products primarily in the U.S. and Canada. Also in 2010, major challenges—including intense global competition and economic uncertainty—were sweeping across the tire industry. In response, Goodyear’s executive team decided to restructure the business from a volume tire supplier to a market-oriented tire supplier focusing on target-market segments. We knew this fundamental shift was going to require development of a deep leadership bench that would help sustain the change.
We already took identification and development of future leaders seriously and knew that identifying future leaders was a strength among our managers at all levels. We lacked a process to prepare potential leaders for new roles. So we made a commitment to establish a development process that would accelerate the shift to a market orientation and help us close our senior leadership gap.
From 2010 to 2012, implementation of a new leadership development process helped us make the strategic transition. Here’s how we met the challenge:
We have always sought to have two "ready now" candidates for each senior position. For many years, Goodyear has had a rigorous global succession planning process that features transparent discussions about talent. Each product business unit and function conducts its own reviews. For example, leaders in our manufacturing organization discuss critical roles within plants and identify successors and high-potentials each quarter. The executive team holds quarterly reviews. Finally, top leaders conduct an annual succession plan review.
Previously, once future leaders were identified, we often labeled them as "not ready now" and let them mature in their current roles rather than really develop them. Our new leadership development program was designed to remedy this.
Our challenge was to design a sustainable development process to keep high-potentials learning and prepare them for senior roles. We needed to:
In the past, we had frequently brought in experienced leaders from outside the company who had been through business transformations, thinking they would be able to lead us better than someone on the inside—or get us to our goal faster. While the candidates were excellent, our success rate with external hires in key leadership positions was often lower than expected. We came to realize that we needed to lower our dependency on external hires for top roles. We adopted the philosophy of "buy early and build up"—acquiring top talent early in their growth and providing them with plenty of development.
To move forward, the first step was to conduct a learning-needs analysis. Our executive team identified the competencies to carry out our strategy. The resulting 10 management competencies, along with Goodyear’s five leadership traits, became the skills we wanted to measure within our management population.
We adopted the philosophy of ‘buy early and build up’: acquiring top talent early in their growth and providing them with plenty of development.
We surveyed 1,800 emerging leaders and managers, asking respondents to rate their current performance on, and the importance of, each skill. The response rate was 85 percent.
The results of this survey dictated the direction of our Senior Leadership Development Program. For example, change management emerged as a focus area when skills deficiencies were discovered. Although survey results indicated that the change management competency was a strength among our management population, further analysis revealed that people rated themselves highly when it came to "telling" others about change but poorly when it came to bringing people along with change.
Developing others received the lowest ranking in terms of current skill levels, so it became a second focus area. Two other focus areas, strategy and results focus, were also identified.
The executive team then selected 48 participants for our first development cohort. Their titles ranged from manager to general manager, director and chief marketing officer. They were chosen from our succession process and represented all units and functions.
Each person had to be nominated by one executive and endorsed by another. This double-nomination requirement encouraged executives to get to know talent outside their own units.
The Development Model
We applied a 70-20-10 model to the yearlong program: 70 percent learning on the job, 20 percent learning from others and 10 percent formal learning.
We selected Harvard Business Publishing for curriculum design and program implementation. Our curriculum blends virtual and in-person sessions using Harvard’s Leadership Direct platform. Participants access content, such as readings, discussion boards, webinars and Q&A sessions, via the platform. Four modules correspond to the needs revealed by our analysis. A Harvard moderator oversees the program, facilitates virtual sessions, moderates discussions and interacts with participants.
Each module kicks off with a face-to-face meeting, followed by virtual learning over several weeks. Virtual components include case studies and lectures from Harvard Business School professors. For example, professor Linda Hill conducts a videoconference for the Developing Talent module. Participants gain insights from these experts that enhance and accelerate learning.
Goodyear’s executive team members serve as co-moderators. Their involvement shows their commitment to the program and helps participants learn leadership skills. Rounding out the formal learning, each participant has an individual development plan to study Goodyear’s core leadership traits and manager competencies.
To capitalize on learning from others, experts at Harvard helped us introduce a "learning partner" design. We encouraged participants to identify an area they wanted to learn more about and find partners to assist them. A partner is different from a mentor because we are encouraging knowledge about topics rather than providing feedback on observed behaviors.
When developing on-the-job learning, we settled on two critical tools: action learning projects and leadership career path management.
Action learning projects. The executive team collectively developed the projects by identifying real business issues. The projects are enormous. For example, one project team developed a cost-reduction plan that had a substantial impact on our supply chain.The projects were introduced in February 2012; each has two executive sponsors. No team members had previously worked on the topics or in the functions they were assigned to.
Leadership career path management. We now manage future leaders’ careers and provide them with stretch assignments outside their current functions.
Under the philosophy of "collective ownership of talent," the executive team manages these high-potential participants as a group. The team determines individual career moves and how resulting vacant positions will be filled. For instance, one recent stretch assignment moved candidates from the consumer product business unit to the commercial unit for a strategic-change initiative.
The executive team’s approach to collectively owning North American talent has been a critical driver of the leadership development program. And because executive team members sponsor the participants, co-teach the material and sponsor the projects, they now have more awareness of talent outside their units, thereby stimulating conversations about and movement of talent across the organization.
Documented Achievements. We have documented results that demonstrate strength on our leadership bench:
Half of the members of the first cohort have received new assignments or increased responsibilities—28 percent made lateral moves or changed the scope of their roles, and 22 percent received promotions.
We embraced a common language around areas such as strategy and change management. For instance, leaders are familiar with "after-action reviews" because of the business curriculum in the program. We’ve had more new-product launches recently, and such reviews helped us to quickly iterate processes and eliminate barriers.
Many senior leaders have started training programs in their own units and functions. For example, Ryan Waldron, vice president of the North American Supply Chain, who participated in the first cohort, cascades learned methodologies throughout his function. Other supply-chain senior leaders sponsor or teach in virtual "cafés" and discuss how the material applies to their work.
In our 2012 engagement survey, North American associates rated learning and development 5 percentage points higher than they did in 2010.
Expansion of networking across business units has been an unexpected upside to leadership development. For example, open communication and strong relationships help ensure that projects get done in a way that wouldn’t have been possible four years ago; cross-functional project teams implemented their changes quickly—in some cases, before they reported out their projects. In addition, because participants were at different grades, higher-level participants became aware of the talent that could fill openings in their units.
Leaders learned with participants. Executives gained a new way of assessing the business and recognized that their participation ensures that the topics and projects support the North American company’s key challenges.
And in June, Goodyear launched a similar global Senior Executive Development Program in Akron with 25 high-potential associates from around the world, with the goal to develop future global leaders.
Gary VanderLind is vice president of human resources, North America, for the Goodyear Tire & Rubber Co. Amy Alexy is the division director of learning and talent development.
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