Your leadership development program needs an overhaul

Most companies make big investments in leadership development, rolling out intensive programs for people with high potential. But the traditional approach doesn’t necessarily measure up now. Business is moving too fast.

Our experience suggests that an overhaul is necessary to stay competitive. So what works? Most forward-thinking companies are opting to develop leaders while they’re in place, pursuing business objectives, rather than sending them off to educational programs.

Here’s what we’ve learned from three pioneering companies about how to identify, develop and retain leaders.

IDENTIFY: LET THEM INNOVATE

Start by looking for people who care deeply. For example, Barclays Bank and The Walt Disney Co. both seek to create an environment in which employees can pursue business offerings to address problems that are personally meaningful.

Barclays and Disney have created internal venture teams to tackle “social intrapreneur challenges” around the world. Employees are invited to propose ideas for new products and services that have a business case and would make a positive impact on society. Hundreds of employees have applied at both companies. In each case, a group is selected to join an intrapreneurial version of a startup accelerator. Participants work full time at their regular jobs, but over a six-month period they attend workshops and get coaching. Time and money are limited, so participants enlist peers and even bosses as volunteers. They use the internet and social networks to learn best practices. They then pitch to senior leaders, who decide if the idea should be funded.

“This is about business outcomes, but it’s also about ‘learning-by-doing’ and creating a new breed of talent who are resourceful, versatile, purpose-driven and stretch beyond their comfort zones,” says Francois Masson, vice president of human resources for Disney.

DEVELOP: LET THEM IMPROVISE

You don’t need new leadership competencies to develop leaders. It’s about giving employees the room to improvise.

Take Unilever’s UL2020. CEO Paul Polman launched the program in 2013 to create leaders who would thrive in a constantly changing world. In his mind, people with good self-understanding and a high regard for others would be resilient, and open to learning and growing. These qualities would hold them, and Unilever, in good stead. Moreover, Polman believed that the crucible for improvisation should involve tackling Unilever’s biggest challenges, such as doubling the size of the business while reducing the company’s environmental footprint, and increasing its social impact.

UL2020 enlisted teams of managers to take on business challenges that not only had the potential to generate breakthrough results, but that would also teach them new things about themselves as leaders. Participants were challenged to ask: “How can I use my company to make the world better? How can I enlist my purpose and those of my teammates to achieve growth and alleviate pressing societal and environmental problems?”

Teams set out to address problems as diverse as how to develop millions of micro-entrepreneurs, how to combat water scarcity and how to empower female small business owners. The collective efforts at improvisation ended up being the most powerful result. For example, one team applied lessons from a Unilever program in India to the challenge of creating jobs for the underemployed in southern Europe.

By creating narratives to accompany their projects, the teams enlisted hundreds of other Unilever employees as supporters. The results have been substantial. Unilever has generated millions of dollars in new revenue in less than three years. This not only helped the company attack some of its biggest business challenges, but equally important, team members felt reivigorated at work.

RETAIN: LET THEM LEAD

Companies like Barclays, Disney and Unilever discover a counterintuitive insight as they develop leaders: When people grow while working on projects of their choice that create new value for the company, they become more valuable in the marketplace but less likely to leave.

For example, at Barclays in 2015, Tom Manuel and Ben Harper, both in their early 20s, supported the development of a banking proposition designed to meet the needs of the armed forces and their families. In the process, they developed a skill set that differentiated them from their colleagues, and were offered more senior roles in the team that took the proposition to market. In an environment where such talent is in high demand, they were given the opportunity to finish what they started, and they took it. By providing a platform for employees to fulfill their potential, Barclays developed leaders from within and retained them.