Few organisations orchestrate it to the best of their ability

This month, we spoke to Tim Clayton-Ball, Global Lead on Leadership at Deloitte. He argues that as well as current ability, future potential and development are crucial in ensuring that organisations find the right leaders.

How vital is it for organisations to have a clear leadership succession plan in place?

While most organisations realise that succession planning is an important priority, few orchestrate it to the best of their ability. It is critical that all organisations have a clear view of the candidates with the potential to succeed in senior leadership roles. Where individuals have been identified, an explicit and agreed development plan must be put into place. This will be made up of two key elements: firstly, how the individual will plug any gaps currently present; and secondly, how they will secure the experience they need to be in a strong position to succeed.

How can organisations go about identifying the leadership traits required to deliver their commercial objectives?

Most organisations have a clear view of the leadership traits required for their own organisation and while words may differ these typically balance behavioural and more commercially-based/performance traits. Consideration needs to be given to both current performance against and future potential. Within Deloitte Leadership, we use a combination of 360 degree input against the leadership traits with psychometric testing for a more comprehensive view of where leaders are today and what they need to do to develop.

We typically see four approaches to succession planning that range from process-centric to people-centric on one dimension that can either be subjective or objective.

To what extent can systems that enhance understanding of these traits be used to: a) measure the traits of successful leaders and how those of prospective candidates compare? and b) assess whether leadership candidates will fit in well with the existing leadership team?

This depends on the completeness of the assessment when boards are comparing one potential candidate for leadership with another. Adopting a more centred approach that is both objective and people-centric is an effective approach. This needs to be both engaging and empathetic, but also business centric and behavioural. Leaders also need to be given a development ‘flight-path’. This trajectory can be used to demonstrate how they are progressing against their development areas, and to receive regular and objective feedback from those mentoring them for leadership.

Is it better to look internally for those who understand the business, or externally for those who may bring new ideas?

There have been many studies conducted around the benefits of hiring internally as opposed to looking outside of your organisation for new hires. While those of the latter group offer ‘fresh blood and diversity’, they can take on average six to 12 months longer to get up to speed and ‘in the groove’ of the organisation compared to those who are promoted internally, and are already in tune with the organisation. The optimal position is ultimately a mixture of external hires and internal promotions, balancing that ‘fresh blood’ against those who have worked their way up the internal ladder.

What measures can be implemented to improve diversity in leadership pipelines?

Every organisation is on their own diversity journey. Quotas certainly have their place in ensuring an even balance, but the end goal of these efforts need to be about ensuring that the end to end colleague experience is geared to a balanced and diverse portfolio. This starts from the attraction and selection of candidates for the organisation, right through to managing performance, promotions, and succession. Leaders need to challenge themselves to ensure that decisions are balanced and that this is managed in an inclusive way. People need to believe that the processes are transparent and fair, and free from bias.