The Strategic Leader: Leadership Pipeline Model

Posted by  damu
May 10, 2015

Authors: Damu Winston, Eleonora Ugge, Ashwin Menon, Ana Mercedes Navarro, Ani Tsaturyan & Ali Hassan

INTRODUCTION

Companies spend a lot of time and effort searching for qualified and well-trained people for leadership roles. Since employees are already familiar with the company culture and processes, it is often most efficient and cost effective to promote from within. However, many organizations do not have a process in place that allows leaders to grow internally, therefore, having to recruit externally becomes a costly necessity.

A common mistake that is seen among many organizations is leaders taking on new roles without being provided any clear direction on what their responsibilities are and what is expected of them to be successful within their role. Consequently, the leader’s direct reports are equally impacted by being unclear on what each person is accountable for and what are the expectations for them to be successful in their respective roles.

The Leadership Pipeline Model is a framework that helps organizations to plan and maintain internal leadership development. It provides a structured approach to align the overall company vision and objectives with key personnel. In addition, the model serves as a funnel to identify and grow individual contributors, to the most senior managers, for creating a sustainable pipeline of future leaders. By providing a framework that clearly identifies role specific competencies and behavioural skills, leaders at all levels have clarity around what is essential for sustainability and progression within the company. [1]

According to the Leadership Pipeline Model - Developing Your Organization's Future Leaders, by Mind Tools, the Leadership Pipeline Model is categorized into six (6) leader progression transitions. However, Exhibit 1 (to the right) groups the Leadership Pipeline Model into 4 major groupings (i.e., L1 - First Line Manager, L2 - Leading Manager, L3 - Business Leaders, and L4 - CEO).

*Figure 1 -  https://www.mgtsystems.com/sites/default/files/wmud_management_leader_dev_r4.2.jpg


First Line Manager - a.k.a. First Line Supervisor 

(1. Managing Self to Managing Others)[2]

The career entry-level stage of an employee when he/she starts to work for the first time in an organization is generally as an Individual Contributor (IC). No matter the business vertical, the IC performance is based on individual skill proficiency (including technical and professional) and his or her individual contributions to the team/output.

As the ICs adopt the company's culture and standards (including planning, on-time delivery, quality content and creating added value), managers often add operational responsibilities, after which they are later promoted to a First Line manager (FL) role, also known as “Level 1”.

Synthesis and Application: Though making the role change from IC to FL might look easy, companies generally forget that this transition is often the most important step in a leaders’ progression. Therefore, it should be closely monitored and coached where appropriate. It is in this role, as a FL manager, that he or she learns and makes the behavioural transition from individual (i.e., “I”, “My”) success/performance to team (i.e., “We”, “Our”) success/performance.

This is followed by managing time effectively in both, individual work and coaching the team for success in their work and performance outputs. This shift is more difficult in cases where the individuals are knowledge based / technical skills (e.g. Systems Project Manager or a Financial Manager) and are known for their individual productivity. The shift to a role where team output is valued more should be their primary responsibility, else with time, they tend to become a liability.

These changes will only take place efficiently if properly implemented by upper management. Providing FL managers with a clear description of their role, expectations and responsibilities, which plays a vital role in successfully coaching them for their first role as a manager.

Three key priority areas where First Line managers need to focus on are mentioned below:

Key Priority Areas                                                                   
1.   Staff Management: Establish credibility among your employees which includes making time for the team, delegating, individual planning, coaching with feedback, motivating, handling conflicts/problem and performance evaluation by assessing contributions.
2.   Quality Control: Making sure the combined output of the team delivers value and meets the overall operational goals.
3.   Communicating and acting as a liaison between the team and their direct reports to effectively execute operational plans.

Leading Manager - a.k.a. Middle Manager

(2. From Managing Others to Managing Managers and 3. Managing Managers to Managing Functional Managers) [3]

As a Leading Manager (LM), also known as “Level 2”, the key element in this role is to assign managerial work, measure progress and coach FL managers. LMs need to be able to understand, translate and break down the company vision in silos and business units. These LMs must think beyond their daily activities and approach managing from a medium-term strategic view, focused on key issues that look at the general company business, industry and market in which the company operates and it’s competitors landscape.

At this level, the most common mistake that top management commits, is selecting FL managers based on their specialized technical/professional skills, rather than their managerial ability. Both act as a vital link between L1 and functional departments.

Synthesis and Application: Guiding and coaching are crucial activities at this level to fully implement a managerial style. By attending workshops to practice coaching skills, give/receive constructive feedback and learn how to use qualitative-quantitative performance tools (e.g. scorecards, questionnaires, 360 models, interviews), the LM will be better prepared on how to develop their direct reports. Additionally, by analysing the strengths and weaknesses of their direct reports, the LM is better equipped to best align their operational FLs managers. Emotional intelligence plays an important role; as a good LM is able to understand what his or her FLs managers are really interested in, and align role with their goals and underlying motivations.

LMs are expected to achieve managerial success in the assigned business units, departments or branches. Managerial success is the ultimate goal on which they will be evaluated by their supervisors. To succeed in their performance, managers needs to ensure high levels of productivity and profitability, by leveraging maximum value from the resources utilization. This is a vital transformation in the leadership pipeline model since this is where managers shift their responsibilities from micro to macro management of the company.

Three key priority areas of Level 2 managers need to focus on are as mentioned below:

Key Priority Areas                                                                   
1.     Communicating the business strategy in alignment with the company’s vision and its impact on teams to maintain sustainability.
2.     Make trade offs between function and present/future to create additional value for the business.
3.     Integrate cross functional performance to drive profitable implementation of work carried out by the whole business.
4.     Provide accountability for performance plans and results inline with the direction of the business.


Business Lead Manager - a.k.a. Senior Manager
The Next Critical Shift

(4. Managing Functional Managers to Business Managers and 5. From Business Manager to Group Manager)[4]
Ideally, the role of Business Lead (BL) Managers is the most challenging role of a leader’s career. The BL role integrates the Business Manager and Group Manager roles. While Functional Managers typically focus on leading people with the same/similar background and skill sets. Business Managers and Group Managers, both share a broader view of the organization/business; he/she is accountable for cross functional leadership; leading people with disparate (not necessarily the same/similar) background and skill sets. Both types of BL managers delegate tasks to their direct reports, and oversee a collection of functions/business units. Group Managers differ in regards to how they shift from valuing the success of his/her department to valuing the success of other’s department(s).

 Synthesis and Application: An ideal BL will inspire, identify opportunities to champion his/her LMs and drive for results through their performance. He or she will allocate time daily to ensure long-term organizational/business goals are aligned, and proactively participate in business meetings that drive performance through LMs. In order to calibrate their strategy efficiently and to develop a competitive advantage through leveraging LMs, BLs will stay abreast of industry trends. Therefore, the ideal BL will have a good understanding of the industry operating models, foresee future trends, and a mastery in dealing with complex situations. [5] According to the Leadership Pipeline, by Charan Drotter and Noel, this “role also requires a critical shift in the below four (4) skills:

  1. Proficiency at evaluating strategy for capital allocation and deployment purposes”
  2. Development and coaching of business managers
  3. Portfolio strategy – what businesses must be added, subtracted, or changed to position the organization properly
  4. Assessing whether they have the right core capabilities.” [6]

Three key priority areas BL managers need to focus on are as mentioned below:

Key Priority Areas                                                                
1.     Brings people from functional and geographical boundaries together to commit to shared goals.
2.     Decomposes the company’s long term strategy into divisional/functional strategic activities. Acts as a spokesperson (internally and externally) for own area of the business.
3.     Oversees the organization's day-to-day operations. Tackles challenges and opportunities outside of own area of responsibility in order to benefit the organization or clients.

 

CEO Level

(6. Group Manager to Enterprise Manager)
The CEO is the final step in the career hierarchy; this is the most visible position in a company, which can influence how the society perceives the organization, affecting the image of the company. This transition is concentrated more on values than on skills.

Synthesis and Application: Future CEOs must understand that they have duties towards different stakeholders like the investors, board members, partners, employees, direct reports, government, authorities and local communities. As leaders of a company, they must concentrate on a long-term vision, driving quarter by quarter’s performance and being sure that is adjusted with long term strategy. This role requires understanding the industry, the ability to manage external shifts and always looking for growing opportunities to expand the business.
The shift in responsibilities from group manager to CEOs is from “strategic to visionary thinking and from operation to a global perspective.” This is also the only job in the organization that grabs the attention of the entire company/organization.

Key Priority Areas                                                                   
1. Work towards expanding the stakeholders’ network.
2.   Focuses on a holistic view of the business.
3.   Staying abreast of competitors and industry leaders.

Implementing the Leadership Pipeline Model within an organization encourages internal leaders to develop new skills and “mind-sets for leading at the next level,[ thereby ] increasing flexibility and effectiveness.”[7] In addition, having an organization focused on the constant development of their employees, raises staff morale and retains top talent. This model also empowers employees with the tools to plan their own career progression roadmap.


Example of a critical analysis of the impact of the Leadership Pipeline Model on organizational performance
The leadership pipeline is used to create a more systematic, visible system of identifying candidates for succession, combined with the processes for their development. Some key positive elements that brings this model are:

  • Matches employees in the right position and identifies the gaps between different levels.
  • Creates a mutually beneficial relationship between the organization and the pool talent.
  • Requires multiple inputs to leverage high potential as developers of talent.
  • Retains and attracts the best talent in the market, that can improve financial performance, by bringing new clients or generating new business ideas. Overall new talent can boost the company's image.
  • Establishes proper timeframe to prepare individuals for their next step at the right time and place.

On the other hand, Leadership pipeline problems occur at a higher level for two common reasons:

  • CEOs are often unaware that this is a significant passage that requires changes in the core values.
  • It's difficult to develop a CEO for this particular leadership transition.

Xerox is an example of a company that failed to train and coach their managers to understand the value and expectations of the new position. Instead of focusing on their own managers and preparing them, Xerox hired a new CEO from outside the company, without a clear transition or handover to understand the roles and the responsibilities that affected the leadership structure and the overall company performance. On the other hand, the CEO of Quest Diagnostics, Ken Freeman, adopted a talent-oriented approach by identifying and developing the right team to lead others at critical stages in the company’s evolution. This approach helped the company to increase their market value by 300 percent through a merger with SmithKline Beecham.[8] Another example of successful application of the model is Campbell Soup Company.

The CEO, Doug Conant, invested most of his time focusing and driving employee engagement and providing them with the necessary environment, where extraordinary leaders flourish. [9]Nowadays, skills and managerial roles keep on changing according to the industry and technological trends; having such a flexible model helps the firm to keep up the pace with the market. The Pipeline framework supports the company in overcoming cultural misunderstanding and aligning different set skills and background to one common set of goals. To make the most of the leadership pipeline model within your organization, senior managers need to share and communicate the guidelines with all the business units, list the activities that defined each stage of development, review and keep updating the framework frequently, integrate performance and evaluation tools. The Leadership Pipeline provides the steps of effective implementation of the company´s future direction, by establishing performance goals, giving detailed job descriptions and career development guidelines that contribute to create a sustainable competitive advantage for the company.


[1] The Leadership Pipeline Model, Retrieved April 19, 2015 from http://www.mindtools.com/pages/article/leadership-pipeline-model.htm

[2] Leadership Pipeline, Charan Drotter and Noel, Retrieved April 19, 2015 from http://sed-efca.org/wp-content/uploads/2013/05/Leadership-Pipeline-by-Charan-Drotter-and-Noel.pdf

[3] IBID 1

[4] IBID 1

[5] IBID 1

[6] IBID 2

[7]The Leadership Pipeline Model, Retrieved April 19,2015 fromhttp://www.mindtools.com/pages/article/leadership-pipeline-model.htm

[8]Optimizing you leadership Pipeline , by Tacy Byham, Jim Cancelman, Chuck Cosentino and Richard Wellins RetrievedApril19,2015 fromhttps://www.ddiworld.com/DDIWorld/media/white-papers/optimizingyourleadershippipeline_wp_ddi.pdf?ext=.pdf

[9] IBID 8

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My name is Damu Rufaro Winston. It means “one who brings happiness to his people”. Over the years, I have learned a person’s name is so much more than just an identifier. Most parent(s) spend countless hours deciding, fighting, and praying over the name of their soon to be son or daughter.
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