During the last decade, there has been an explosion of leadership assessment instruments, methods and consulting firms providing this service. Yet, according to the New Talent Management Network’s 2011 survey on the State of Talent Management, only half of the 111 participating organizations indicated the practice of assessing leaders is “often or always” effective. Forty percent rated the practice as “sometimes” and 10 percent rated it “never” effective.
These results highlight a significant gap between the last decade’s advancements in the science of leadership and assessment techniques and learning leaders’ perspectives on their return on investment.
It also raises an important question for organizations that use leadership assessments or are considering them to help select and develop senior leaders: What can be done to improve accuracy of predicting future leadership success, especially for more complex senior-level roles where leadership behavior is complex and dynamic? Some tools and techniques, such as assessment and development centers, competency-based 360-degree surveys and some personality questionnaires have proven superior in their ability to reliably and accurately assess a leader’s strengths, weaknesses, values and flaws.
Because of the complexity of leadership behavior, no single tool can be the silver bullet for leadership selection, high potential programs, development or succession planning. Practitioners should strive for a holistic and integrated assessment approach that builds from four key principles:
1. Leadership is a dynamic and complex behavior that requires agility and coordination of various competencies.
2. Complementary methods are needed for reliable and valid assessment of dynamic and complex phenomena.
3. A leader’s motives, values and psychological needs are paramount to assess role and organizational fit.
4. Integration with a learning and development path is a critical component of the assessment process.
Leadership Is Dynamic and Complex
Leadership has many definitions and adjectives: situational, transactional, transformational or charismatic. In general, the propagation of definitions has been healthy for the field as it forced researchers and practitioners to fully appreciate how dynamic and complex leadership is, and therefore how challenging it can be to assess it. It also suggests the various dimensions of leadership should be examined through multiple lenses: behaviors, cognitive ability, values and personality characteristics as well as traditional behaviorally based competencies. Focusing on leadership through multiple lenses is especially important in leadership roles with a high degree of complexity, where simply scoring higher on a set of competencies won’t necessarily mean a greater likelihood of success in a future role.
Lenses help leaders “see more and see differently.” Like an eagle that can see for miles or an owl with powerful night vision, leaders who know how and when to use different lenses can better help a business succeed long term. Essentially, lenses reveal a leader’s coordination and facility to utilize various competencies simultaneously. A skilled golfer must develop coordination of various arm, core and leg muscles to have a fluid swing and practice constantly to develop muscle memory. Leaders must develop agility and coordinate various competencies. Having the strongest muscles doesn’t produce the best swing, nor does having the highest ratings on a competency assessment lead to business results.
This perspective is consistent with many of the classic leadership models such as Fred Fiedler’s contingency model (1964), Paul Hersey and Ken Blanchard’s Situational Leadership model (1969), Robert House’s Path-Goal theory (1974), and Bernard Bass’ transformational leadership model (1985), which suggest that leadership is influenced by organizational context and certain leadership styles are less effective in specific situations.
Figure 1 illustrates five lenses that originally appeared in the book, Shockproof: How to Hardwire Your Business for Lasting Success. The authors, Debra Jacobs, Garrett Sheridan and Juan Pablo Gonzalez, make the case that leaders who develop these lenses can diagnose misalignment and take appropriate actions to create alignment between strategy, organization and talent to better position a business for lasting success. The complexity implied by each of the five lenses — managing dynamic relationships inside and outside the company, keeping the organization focused, driving change when it’s needed, forging human relationships and understanding one’s own strengths and weaknesses — underscores the importance of an integrated and holistic assessment approach.
Financial services company National Financial Partners Corp. (NFP) understands the value of multiple lenses.
“When rolling out a senior leadership succession process at NFP, we have found that the leaders with the most potential have much more than deep technical skills and a track record of business results,” said Emily Arean, senior vice president of human resources. “At NFP, being an effective executive requires well-developed systems, value, interpersonal and change lenses.
“Understanding the complexities of our businesses is just the baseline for a leader at NFP. Managing complex relationships while keeping focused on short- and long-term goals requires a multidimensional approach that cannot be easily defined, let alone measured, by a single instrument or method.”
Michael Puri, vice president of human resources for Staples Europe, said applying multiple perspectives to leadership assessments has been invaluable in his experiences selecting and grooming leaders for global roles.
“Highly effective leaders have much more than deep technical skills and a track record of business results,” Puri said. “At Staples, being a capable global leader requires learning agility to operate across four leadership dimensions: business leadership, functional leadership, team leadership and personal leadership. Business leadership is all about what it means to be a leader at Staples depending on the position along the leadership pipeline.”
Leaders Need Complementary Assessment Methods
Because leadership is dynamic and complex, leadership assessment must include multiple methods (Figure 2). Business simulation exercises, personality questionnaires such as Hogan Leadership Forecast or the Birkman Method, 360-degree feedback surveys such as those from the Center for Creative Leadership (CCL), competency-based interviews, assessment and development centers are some examples.
A competency-based 360 survey, for instance, can be a powerful component of leadership assessment and development, but when used without other tools and techniques such as business simulation exercises or competency-based interviewing, it may yield a distorted view of whether a leader truly has what it takes to succeed at the next level.
Participants in an assessment process should have the opportunity to demonstrate their capabilities across a broad spectrum of leadership behaviors. Since no single assessment method has proven reliable across this spectrum, multiple and complementary methods should be considered to increase the likelihood that an assessment process will predict a leader’s probability for success.
NFP’s Arean found that competencies alone fall short in sizing up whether a leader will succeed at the next level. Instead, NFP relies on a combination of Hogan assessments, CCL 360 surveys and competency-based interviews.
“Because of the multi-dimensional nature of leadership and the various needs of our organization, having a wide and complementary set of assessments that take into consideration the broad spectrum of leadership behaviors has proven very effective not only in the assessment of the individual itself,” Arean said. “It has also brought credibility to the process.”
At Staples Europe, Puri relies on four proven inputs to size up whether a leader will succeed at the next level. For example, candidates identified to move to a senior executive role will have their data collected and evaluated against the four points to develop a complete and accurate picture of their readiness. The first three inputs — a behavioral interview, a review of performance over time and a personal assessment using a tool called activity vector analysis — are managed by internal Staples resources. The fourth input comes from an external assessment center.
Figure 2 illustrates the multidimensional nature of leadership capabilities and the effectiveness of various methods commonly used to assess them. These methods should be conducted by a qualified assessor. Special job-related assignments should be related to the role in question and the depth and breadth of experiences, and reflected in the leadership competencies. The figure shows that no single method can effectively assess the capabilities across the spectrum. A robust assessment, therefore, requires multiple complementary methods.
The Leader’s Motives, Values and Fit
For leaders to be effective they must motivate others to forgo individual goals and take on group goals. Even the most highly skilled and polished leaders can fail at this if their motives and psychological needs are not congruent with the job or if their values are inconsistent with the organization’s culture.
For example, a traditional, conservative, risk-averse individual with a low commercial orientation would experience significant stress, and likely derail, if placed in a role overseeing mergers and acquisitions where his or her motives and needs are not being met. The same individual also would not fit culturally in a flat, non-hierarchical, start-up environment where high risk is assumed, conventional organizational norms are absent and the founders are looking to quickly cash in on taking the company public.
A leader’s motives, values and organizational fit are paramount and represent the difference between a highly capable manager and a leader with the vision and charisma to unlock individual and organizational potential. As illustrated in Figure 2, personality assessments and competency-based interviews represent the most effective method to assess this aspect of leadership.
Motives, values and fit are key elements of Staples’ global expansion strategy.
“Transforming Staples into a global organization requires leaders to operate in a global framework with a global mindset and, often, to lead virtual teams,” said Puri. “This challenges the traditional leadership mindset of having a cohesive team within close proximity. And it elevates the importance of transparency and authentic leadership behavior, particularly among new generations in our organization. As such the credibility of the leaders’ values and their behavior will be under significantly more scrutiny than before. People can point out any inconsistency and make it public using social media.
“One of the main reasons your top talent will leave your organization is if they are poorly managed and find the company’s vision and goals unclear and uninspiring,” he said. “This talent has motives and values that they are constantly comparing with the motives and values of their leaders.”
Arean said understanding leaders’ motives and values is critical because it reflects what type of culture they will build and whether it is consistent with a company’s norms and values. “Our business has been built on our ability to attract and retain an entrepreneurial group of managers who join NFP to grow the business,” she said. “Having a good understanding of the preferences and values of an individual while assessing leadership capabilities is key to putting into context the strengths and developmental path for our leadership pipeline, and the potential impact to the organization. Organizational fit can only be assessed when the personal and organizational dynamics are contextualized.”
Integrate Assessment With Development
When the assessment process is successful, it can render a clear photograph of a leader’s readiness and potential. While this picture may provide a high-resolution view of capabilities, this is a static image taken from a point in time, from a collection of previous experiences and acquired skills. The assessor must extrapolate from the data whether the results suggest that a leader can succeed in a specific context. For an organization to fully realize the value and impact of an effective leadership assessment process, this static picture must be used to make decisions about the leader’s future potential, placement and development.
Organizations that can integrate the assessment process with a learning and development path can unlock the full value of leadership assessments. In other words, assessments shouldn’t be used to make binary, yes/no decisions and stop there. The results of assessments should guide learning leaders as they make decisions about investing to improve various processes, including:
• Leadership on-boarding and transition planning.
• Development planning.
• Executive education and training.
• Coaching.
• Mentor selection.
• Team building and alignment.
“At Staples, we integrate our assessments with a simple and focused individual development plan that is discussed with the associate, the manager and the assessor,” said Puri. “This can lead to several additional leadership development activities such as coaching high-potential talent to move up to the next level.”
Leadership is a complex and dynamic phenomenon that is difficult to assess, especially at senior levels where leading requires more than a well-developed set of competencies. Assessments, when used in an integrated and holistic manner consistent with job complexity, can be a powerful means to select and develop leaders. Any lack of perceived utility is often the result of over-reliance on a few non-complementary methods, a lack of consideration for leadership motives, values and organizational fit, and poor learning integration.
For chief learning officers and their teams, tapping into the knowledge gained from integrated and holistic assessment practices can ensure their efforts and investments are truly aligned with the company’s strategy.
Aaron Sorensen is a principal, and Marc Timmerman a partner at Axiom Consulting Partners. They can be reached at editor@CLOmedia.com.
