Few would dispute that an organization’s ability to identify and develop future leaders, better and faster than its competitors, can provide an advantage. Just as speed-to-market with a product enables an organization to get ahead of the competition, a steady pipeline of leaders, ready to respond to future challenges and opportunities, provides a competitive edge. To gain this advantage, organizations invest time, money, and resources into building leadership capability—the collective leadership skills, abilities, and expertise within an organization that allow leaders to work together effectively to execute the firm’s strategic priorities. However, organizations continue to express concern about their ability to build leadership capability fast enough to keep pace with the needs of their business; simultaneously, leadership capability is viewed as a top priority. As the gap between leadership capability aspiration and reality continues to widen, Human Resources (HR) practitioners can help their organizations solve this critical business issue. This article outlines four steps to identify leadership capabilities critical to an organization. The first three steps establish business context for determining the most pressing leadership challenges an organization’s leaders are likely to face when: 1) responding to the shifting demands of the external business environment, 2) executing the organization’s business strategy, and 3) fostering an organizational culture that enables business strategy execution. The fourth step uses information from the previous steps to prioritize 3-4 leadership capabilities that enable effective responses to an organization’s critical leadership challenges. Although there is no one-size-fits-all approach to identifying leadership capabilities, the four steps provide one way to determine the leadership capabilities that drive a firm’s business performance and competitive edge.
Note: This article was originally posted on Linkedin, October 2016.