The Critical "Make or Break" Role of Leadership

Part 2 - Learning & Development Series

6 issues to consider about the importance of making learning a strategic investment in your people.

As we described last week where we set the stage for why L&D needs to elevate its game to support organizational growth and change initiatives, learning and development (L&D) is critical to an organization’s success. It’s not surprising that CEO’s of organizations continue to assert that talent is their #1 or #2 concern, particularly as it relates to skill gaps.[1] Why is this?  Aside from the impacts on talent caused by globalization, demographic changes, and technology advancements in the post-industrialized era, organizational leaders recognize the real need to have a relevant, readied and enabled workforce to execute strategic goals and objectives. This is especially true during periods of change. Business change requires reassessment of business strategies, operating models, organization structures and competencies (i.e., knowledge, skills and behaviors) to address the very nature of work being performed.  To work at an organization’s optimal potential will require:

Reprioritizing Learning & Development Through Leadership’s Commitment and Participation

As a result, the investment and ROI to elevate organizational learning functions to improve and retain your talent has become just as, if not more, important as “buying” talent through the recruiting function.   The bottom line – leadership at the enterprise level must involve the L&D function and reprioritize its efforts to develop talent in order to:

• Capitalize on opportunities
• Sustain performance
• Accelerate the return on its investment

Our experience reveals that learning must become a strategic priority, especially during significant change, in order to exceed expected results and really engage your people. Interested in knowing why? We have a case study to share about our experiences.

Why is Leadership So Important to L&D Efforts?

1. The right leadership is often void when change occurs.  People in leadership positions are vulnerable when they are not prepared to lead during a period of significant change.  If they do not have the competencies (i.e., knowledge, skills and behaviors), capabilities, energy and/or style to lead the change, or worse do not like the change because it dilutes their influence and control, not only is the organization at risk, but leaders themselves are at risk as well.     

Further, 50% of companies recognize a general need for more leadership talent.[2] At a minimum, the issues of preparedness, resistance and sheer resource capacity will impact the leadership requirements to execute change during its different stages such as:

• Initiating and incubating change during the early phase,
• Maintaining the change momentum, and
• Managing individual transitions through the change process.

It is not a function of trying to follow a checklist. Leaders must understand the implications of change, including how to lead through change and leverage the talent development programs to manage change and accelerate performance. Since reality of the business world is now continuous change, a core competency of leadership must be handling and managing change. L&D must play a significant role in developing the leaders’ competency to lead during change and apply that competency in the current environment to address changes their organizations face.

Question:  What is L&D’s role in preparing leaders and future leaders for a world of continuous business change?  

2. Leaders, your competition is not waiting until you figure it out. While the adequacy of leadership competencies must be continually evaluated, it becomes particularly critical before event-based change or when change becomes an organizational constant. The organization must look at its current leadership team and objectively assess strengths and vulnerabilities against current and emerging organizational needs.  

What do you do with the leaders who have led so effectively before the change and now may not have the competency, capability, energy and/or style to lead after the change?  

We’ve all seen or heard of instances where a startup moves into the “growth phase” or a more mature organization initiates a market-driven growth plan. Both need leaders who can balance the risk and reward by taking calculated risks or who can internally develop or recruit and assimilate talent under them to distribute the right leadership across a broader base.  It is not uncommon for an organization to delay changes merely because they do not know how to deal effectively with the impact of change on their current leaders. Again, peak performance and associated operating results are delayed and, in many cases, desired results are lost to the competition. 

For example, Hitachi suffered a stall in 1994 after decades of sustained growth and has underperformed the S&P 500, NASDAQ and Dow during the years since the stall.  Hitachi had a long history of promoting leaders exclusively from the energy and industrial side of the company in keeping with its engineering culture and this narrow experience base lost step with the market, delaying timely response to emerging strategic issues.[3] However, in 2010 a new CEO from the information and telecommunications side of the business was named who required greater diversity and a more global approach to management. Leadership and other development actions were taken to broaden the experience base from the Board of Directors on down. As a result, financial results have improved since 2010 and Hitachi is currently outperforming Toshiba, Mitsubishi Electric and the Nikkei 225.[4]

Question: What is L&D’s responsibility in the operational success of the business and the corresponding return on investment?

3. Leadership must not underestimate the impact of change on the organization. Instead of knowing what management needs to support and lead during change, senior leadership optimistically assumes that everyone is “on the same page” and “has what it takes” to implement change. Herein lies the organizational and leadership gap or dilemma creating “change permafrost” – apparent when the top of the organization processes the change event one way, but that message is not translated into the “minds and hearts” of people beneath the “change permafrost.”  Utilizing the L&D programs to communicate the vision, purpose and mission develop the competencies and capabilities, and understanding how to apply the competencies and capabilities in the new environment or strategy is critical to thawing the permafrost and closing the gap.

Question: What is the role of L&D in getting the message to “minds and hearts” of all of the people during significant change?

4. Leaders cannot “sneak up” on change just because they think it is going to be disruptive. How many times have you heard or observed by management’s action that they were thinking:

“Maybe if we approach this change like nothing is happening, everyone will naturally figure it out,” or “we can just finesse it as we go?” 

The non-transparent approach employed to avoid confrontation is not the right approach.  Transparency about the vision and purpose of change is critical. It may be difficult at times to address negative reactions to change, but it must be confronted directly to effectively realize change results. 

Question:  Do messages about desired change outcomes embedded in both communications and L&D efforts create a major differential and provide leadership with multiple forums for instituting the change? 

5. Leadership and managers must not get distracted with business as usual … or not as usual. It is typical that both leaders and managers fight competing priorities almost immediately, between the responsibilities dictated by the change and their “day” jobs from normal business operations. The tendency is to dive back into normal routines leaving behind the change-related responsibilities with attitudes of “it’s not a big deal.”

However, equally common albeit more difficult is the situation where an internal change initiative is anticipated with thoughtful planning and investment by leadership and managers then one or more external environmental factors blows it all up.  The environmental factor becomes a reality distracting leaders and managers from fully executing their plan to achieve the desired internally driven change. How many times has this happened in our complex business world?  In this case, there may be no choice but to react before the next big change and the next one and the next one – almost a hyper-sequence of internal and environmental changes across the organization that limits or negates progress due to leadership and manager distraction. This is where strategically aligned and well-planned L&D can have a huge impact on increasing the organization’s learning agility and thus its business agility.  The result is greater resilience for the impact of continuous change and a forum for meaningful two-way communications between business leaders and L&D.

Question:  Is L&D stuck in the management of and administration of legacy and out-dated programs? 

6. Stakeholder sponsorship by leadership and continual participation is critical. There must be stakeholder sponsorship from leadership in all areas of the organization directly impacted by the change events, including L&D. L&D must have active stakeholder involvement embedded in all learning channels and especially during learning events, but all stakeholders must also personally assimilate the change and actively demonstrate it during daily business operations through their words and actions (i.e., “walking the talk”).  When stakeholders act as role models for the change and participate in the design, development and delivery of the L&D programs, they validate organizational L&D efforts as a strategic priority.

Question:  Does L&D have the active participation of leadership in their efforts from end to end?

Didn't get a chance to read the first article in the series?  Click here to read blog #1.

[1] PricewaterhouseCoopers, 17^th Annual Global CEO Survey, 2014

[2] Aberdeen, Learning Skill Gaps, October 2013

[3] Matthew Olson and Derek Van Bever, “Stall Points,” 2008

[4] David Jansen and William Macmillan, PricewaterhouseCoopers, “Bouncing back:  Two Japanese corporations’ road to resilience,” 2014

This blog was co-authored by Joanne Flynn, Jim Bosserman and Debbie Gower.