Toolkit: Developing Organizational Leaders
This toolkit equips HR professionals with actionable strategies to identify, cultivate, and empower leaders within their organizations. It offers insights into leadership traits, development techniques, future trends, and compliance considerations to drive organizational success and inspire teams effectively.
The systematic development of good leaders is fundamental to long-term organizational success, yet organizations often overlook it or undertake leadership development in a haphazard fashion.
There are numerous formal and informal ways of developing leadership within an organization. Leadership development can be quite costly both in terms of monetary outlays and time spent, but smart leaders and successful organizations understand and measure the impact of such efforts on the bottom line.
True leadership goes beyond holding a title or position — it’s about inspiring others, empowering teams, and driving collective action toward a shared vision. While some individuals may naturally possess leadership qualities, the behaviors and competencies that define great leaders can be learned and cultivated. Keep these factors in mind as you help build leaders in your organization:
- Definition of leadership: Leadership is the process of determining direction, influencing a group, and guiding it toward a specific goal. It is a behavior, not a position, and involves inspiring people to live out the vision, mission, and values of the organization.
- Empowering and coaching: Great leaders empower individuals to make decisions that align with organizational goals. They focus on inspiring and coaching others, fostering a sense of responsibility and accountability, and ensuring everyone’s contributions are valued.
- Learned vs. innate leadership: Leadership behaviors can be learned and developed, although some individuals may naturally possess leadership qualities. Leaders are those who seek smarter, better ways of achieving goals and take full responsibility within their communities.
- Leadership vs. management: While managers focus on facilitating processes and implementing strategies, leaders aim to inspire people to live the vision and drive collective success.
- Key leadership traits: Effective leaders exhibit critical traits such as integrity, problem-solving, strategic thinking, communication, relationship building, and innovation. These traits enable them to motivate others, achieve results, and adapt to challenges.
- Adaptability to context: Leadership qualities may vary depending on the organization’s type and context, such as high-tech for-profits versus nonprofits or co-ops, requiring flexibility and cultural competence to succeed.
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Building a Leadership Development Strategy
Organizations face ever-changing challenges driven by technological advancements, geopolitical shifts, environmental concerns, and societal changes. Effective leadership is critical to navigating these complexities and transforming values, beliefs, and attitudes to foster organizational capacity for positive change.
Leadership development, therefore, is not merely a human capital initiative but a strategic imperative. As SHRM research underscores, HR professionals and executives alike recognize leadership development as a pressing challenge and opportunity, with HR playing a pivotal role in crafting and executing strategies that align with corporate goals and deliver measurable outcomes. Here are key considerations for building a leadership development strategy.
- Commitment from senior leadership: Success in cultivating and developing leaders often hinges on the unwavering support of the CEO and senior management team. Without this commitment, initiatives can falter due to lack of prioritization or funding.
- Alignment with business strategy: Programs must be tailored to support the organization’s strategic objectives while delivering both organizational and individual impact. Ensuring alignment between human capital goals and business strategy is crucial for long-term effectiveness.
- Resource allocation and sustainability: Leadership development demands significant financial and managerial resources over an extended period. Organizations must plan for sustainability to avoid disruptions and make consistent progress.
- Address talent gaps and succession planning: Identifying current gaps in talent development capabilities and integrating leadership development with performance management and succession planning creates a pipeline of future-ready leaders.
Metrics
Organizations should consider different types of data when designing a leadership development scorecard to measure the effectiveness of leadership development programs and activities. Such data may include:
- Indicators of the scope and volume of leadership development.
- Participants’ level of satisfaction with leadership development activities and programs.
- Learning and acquisition of leadership knowledge and skills.
- Application of leadership skills to various job situations.
- Business impact of applying leadership knowledge and new skills.
- Return on investment comparing monetary benefits with program costs.
- Intangible benefits related to business measures such as work climate, job attitudes, and initiative that cannot be converted into monetary values.
Much of the feedback on the effectiveness of a leadership development program will be anecdotal. A leader will be able to identify what worked in their case and must also recognize that the same approach may not be as effective for others.
Pro Tip
Purposeful leadership makes people feel valued and helps them understand how their contributions support the collective. Companies should define, measure, and test leadership.
Approaches and Elements to Leadership Development
A robust leadership pipeline begins with identifying high-potential individuals. Tools such as the 9-box grid can help evaluate employees based on their current performance and future potential. However, organizations must avoid common pitfalls, such as confusing high management performance with high leadership potential or overlooking candidates due to unconscious biases. To build a leadership development program that is both effective and future-focused, address these elements:
- Mitigating unconscious bias: Biases related to age, tenure, appearance, or communication style can prevent recognition of high-potential employees. Organizations must implement strategies to make leadership opportunities accessible to all qualified candidates.
- Emphasizing emotional intelligence: Organizations should prioritize developing self-awareness, empathy, and interpersonal skills to help leaders inspire and manage teams effectively.
- Aligning with corporate strategy: Tailor programs to address individual employee needs while supporting broader corporate objectives. For example, if the company is focused on innovation, prioritize programs that develop creative problem-solving, adaptability, and strategic thinking.
Pro Tip
One of the best ways to screen for leadership is through the use of stretch assignments. These may entail reassignment to a different geographical location, business unit, or functional department. Coax employees out of their comfort zones and challenge them to employ new strategies to deal with change.
Techniques for Leadership Development
Once an organization is committed to the goal of leadership development, numerous tools and techniques are available to accomplish that goal; however, the process may be handled differently depending on the size and type of the organization.
- Assessment instruments: Several popular personality assessments are often used in developing candidates for leadership positions and for analyzing leadership styles and their impact on climate and performance.
- 360-degree feedback: By increasing self-awareness, enabling targeted development, and fostering stronger relationships, 360-degree feedback equips managers with the insights they need to grow as effective leaders. When used constructively, it can drive both individual and organizational success.
- Executive coaching: Organizations can empower their leaders to navigate challenges, inspire their teams, and drive long-term success through coaching. Executive coaching is a powerful tool for leadership development, offering benefits such as enhanced leadership effectiveness, greater self-awareness, and improved organizational alignment.
- Mentoring: By pairing emerging leaders with experienced mentors, organizations create opportunities for personalized guidance, skill building, and career development. Mentoring helps mentees gain insights into leadership challenges, decision-making, and organizational culture, while mentors enhance their own leadership skills through reflection and coaching.
- Leader-to-leader development: Experienced leaders can help others understand the inner workings of the leadership team and provide a unique perspective to up-and-coming leaders in an organization.
- Emotional intelligence building: By focusing on self-awareness, empathy, stress management, and social skills, companies can systematically develop emotional intelligence in their leaders. This investment not only enhances individual leadership effectiveness but also strengthens team cohesion, employee engagement, and organizational performance.
- Group-based leadership development: This method of leadership development can happen through outside experience (such as in community, industry, or professional groups), internal programs, or external executive education programs. Group-based leadership development requires leaders and potential future leaders to work in unison to:
- Develop executive skill sets.
- Provide one another with high-value constructive feedback.
- Enhance interpersonal communication.
- Break functional silos.
- Tackle real-world challenges in real time.
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Future Trends
The future of leadership development is being shaped by the need for adaptability, technological fluency, inclusivity, and collaborative learning. Organizations that embrace these trends will be better positioned to cultivate leaders who can thrive in complex, fast-changing environments while driving innovation and purpose-driven success. Here are three of many trends shaping the future of business:
- Emphasis on adaptive and agile leadership: Organizations are shifting from traditional leadership models to adaptive leadership frameworks, which emphasize learning, experimentation, and collaboration.
- Integration of digital and data-driven leadership development: The rise of artificial intelligence, big data, and digital transformation requires leaders to be tech-savvy and data-literate.
- Expansion of coaching, mentoring, and peer learning networks: Traditional classroom-based leadership development is giving way to more personalized and collaborative approaches that foster real-world learning.
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Legal and Compliance Considerations
Leadership programs must be designed and implemented with a strong focus on aligning with regulatory requirements. Here are some key areas organizations should address:
Equal opportunity and anti-discrimination laws: Any leadership development program must adhere to federal anti-discrimination laws, specifically Title VII of the Civil Rights Act, which the Supreme Court recently interpreted in its Ames v. Ohio Department of Youth Services ruling. The decision eliminates distinctions between members of majority and minority groups who file discrimination claims. While this decision provides clarity, it also introduces fresh challenges for HR professionals who manage leadership development initiatives, especially if those initiatives target certain demographics.
“Examples of risk might be a women’s leadership initiative that excludes men [or] a mentorship program limited to individuals of underrepresented racial groups," said Camille Olson, a partner at Seyfarth, during a SHRM webinar on the Ames case. "Do not use the shorthand of a person’s protected status to allow them entry into those benefits." Instead, Olson recommended focusing leadership opportunities on clearly defined business objectives such as closing skills gaps and eliminating hardships or obstacles. Those obstacles may be disproportionately ones that are felt by women or by racial minorities, but the selection for the program should be based on those barriers, not on identity.
Do not use the shorthand of a person’s protected status to allow them entry into those benefits.” —Camille Olson, partner, Seyfarth.
Accessibility and compliance with disability laws: Under the Americans with Disabilities Act, any leadership development program should not exclude people with disabilities. Locations, schedules, and tools should be accessible for everyone. Adopt project management and communication software that includes accessibility features, such as closed captioning for video calls, compatibility with assistive technologies, and text-to-speech functions. Provide training for all employees to effectively use these tools.
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