Leadership Development addresses activities that enhance the quality of leadership within an organization. These activities range from executive development programs, MBA-style programs offered at university business schools, action learning, and executive retreats. Leadership development also includes the process of identifying, assessing, reviewing, and planning for leadership bench strength at the most senior levels in the organization.
Leadership Development is one of the six key human capital processes defined by TDRp(1) and includes:
- Executive assessment and evaluation
- Executive education
- Design, development, and delivery of Leadership courses
- Succession Planning, including:
- Assessment and calibration
- High Potential identification
- Talent reviews
- Talent pool management
- Bench strength assessment
In the TDRp framework, Leadership Development has been separated from Learning & Development due to its strategic importance to organizational success. In many organizations, the development portion of Leadership Development is owned by the Learning & Development function whereas external Executive Education and succession management is owned by a separate leadership development function. In practice, each organization is free to organize their human capital activities any way they choose. We simply need a framework to organize the measures.
Each key process like Leadership Development contributes to the achievement of organization goals (for example, a 10% increase in sales or a 15% reduction in costs) and talent outcomes (for example, a 5 point increase in employee engagement or a 2 point increase in the retention rate). Often, some of the talent outcomes are top-level goals of the organization on par with an increase in sales or a reduction in costs. Other times, the talent outcomes are viewed as intermediate goals in support of achieving the top-level goals. TDRp is designed to work in either case.
Almost 40 measures are defined for Leadership Development. These measures are grouped by type of measure (efficiency, effectiveness, outcome) and across four subcategories. Each organization should choose the measures most appropriate to achieve their goals and manage their human capital. Leadership Development will typically support the broader organizational goals, as well as talent management focused goals. A short summary of each Leadership Development subcategory, including examples, follows.
- Organization – measures of organizational, reporting, and management structure.
- Efficiency examples: Span of Control, Percent of Management without Direct Reports
- Succession Planning – measures that quantify the efforts of succession planning.
- Efficiency examples: Manager Stability Rate
- Effectiveness examples: Percentage of Defined Positions with an Identified Successor, Percentage of Key Positions Filled by Internal Candidates, Succession Pipeline Depth, Succession Planning Success Rate
- Tenure – measures describing management stability.
- Efficiency examples: Average management tenure in current role, Average management tenure
- Leadership Quality – measures that quantify the quality of leadership.
- Outcome examples: Quality of Management Index, Leadership Quality Index
In addition to being grouped by TDRp category (efficiency, effectiveness, outcome), the measures have also been grouped into Tiers, which are described below. In choosing measures, we recommend starting with Tiers 1 and 2.
- Tier 1: These are typically going to be the Key Performance Indicators (KPIs) of a given Talent Process. They are likely to vary from one organization to the next and some “Tier 2” metrics may indeed be key to one organization and “Tier 1” metrics for them, while not for others. At a minimum, “Tier 1” metrics are a list of starting-point, TDRp suggested metrics for those looking to build measurement in a given Talent Process.
- Leadership Development examples: Span of Control, Percent of Management without Direct Reports, Manager Stability Rate, Bench Strength, Succession Planning Success Rate, Average management tenure, Leadership Quality Index
- Tier 2: These are typically going to be the supporting metrics for a given Talent Process, which one might look to in order to determine why any noticeable changes or trends in KPIs might be occurring.
- Leadership Development examples: Manager Span of Control, Executive Span of Control, Management Stability Rate, Percentage of Key Positions with Succession Plans, Qualified Candidates to Key Positions
- Tier 3: These are usually the raw data points that when used in combination with one another create the Tier 1 “KPIs” and Tier 2 “metrics.”
- Leadership Development examples: Number of Positions with Ready Replacements, Succession Planning Candidates, Succession Planning Candidates Ready for Promotion, Management Candidates Ready for Promotion, Key Positions Identified, Key Positions with Succession Plans
Click here for a complete list of measures for Leadership Development. CTR members may also access the full electronic version of the TDRp Leadership Development Measures Library, which provides definitions, formulas, comparable measures, and complete references to source documents for a detailed discussion of each measure.
In addition to the measures described above, ten sample statements and reports have been created for Leadership Development. These are all available in pdf format and as Excel spreadsheets (CTR members only). The various statements and reports are described in the white paper Introduction to TDRp. The ten include the following:
High-level Business Outcome Statement (with qualitative impacts)
Detailed Business Outcome Statement
High-level Effectiveness Statement
Detailed Effectiveness Statement
High-level Efficiency Statement
Detailed Efficiency Statement
Summary Report (with quantitative impacts)
Summary Report (with qualitative impacts)
Program Report (coming in 2013)
These statements and reports are provided as a starting point in your understanding and application of TDRp. We know each organization is unique and will need to select its own measures, but the templates have proven valuable to the early adopters.
The white papers Introduction to TDRp and Extending TDRp to All Key Human Capital Processes are highly recommended. Since the TDRp initiative began with a focus on Learning & Development, more has been written for L&D than for the other key processes. The Tips and Tools for L&D, however, will also be helpful for understanding how to construct the various statements and reports for Leadership Development. With time, advice pieces will be written for each key process.
Notes:(1)The other five key human capital processes are Talent Acquisition, Learning & Development, Capability Management, Performance Management, and Total Rewards. Workforce Planning and Demographics is a key sub process, which supports all six key goals. For more on the TDRp framework see Introduction to TDRp and Extending TDRp to All Key Human Capital Processes.