Leadership development in Europe: Challenges and best practices
By Scott Saslow, Executive Director of The Execsight Institute of Executive Development and Inger Buus, Director of Mannaz, London
The role of leadership development in the modern corporation is evolving. Traditionally more subject to economic cycles or a particular organisation’s fortunes, leadership development activities, budgets, and its overall visibility are increasing. HR and Development professionals have asserted for many years that all corporate development, and especially leadership development, is a key driver for corporate success; management is not only listening but starting to take action and participate, invest, and make leadership development a corporate priority.
Leadership development in European organisations examines the practices in over 50 of Europe’s largest corporations. As the data shows, for leadership development professionals, there is no one single path to managing leadership development effectively in an organisation. In “best practice” organisations across the globe, the variety of practices is fairly wide, and certainly within Europe one notices clear differences as well. These regional differences are discussed in detail in the complete survey.
As we look specifically at the key findings of Leadership development in European organisations, a few themes do emerge from the survey:
Importance of leadership development
The importance of the HR and Development functions, as well as the extent to which leadership development is blended in with the critical business development function (almost 30% of survey respondents stated that these two functions are “extremely” integrated), demonstrates a strong level of importance which is placed on leadership development. Additionally, the level of commitment at the CEO, Board, and Senior Management team is quite strong (54% cite the CEO’s commitment to leadership development as “extremely” strong). There is no doubt that leadership development is an executive management issue.
Continued investment in leadership development
Even during the early 2000s, when much of Europe was still recovering economically, the investment in leadership development remained strong – 40% of companies experienced greater than 10% annual budget growth since year 2000. As we look out over the next few years, we see a continued pattern of increasing investments in this area (38% forecast steady investments; 53% expect budget increases.) Companies also plan to leverage internal resources more frequently in delivering leadership development, with many companies investing their own executive management in the process as both facilitators and participants.
ROI measurement and use of technology
Despite the high level of importance and investment in leadership development, companies examined in this survey are not measuring the return on impact of leadership as much as one might expect, especially given the importance it plays and the size of the investments they are making. Despite utilising a variety of metrics to track the effectiveness of leadership development solutions, a full 63% reported that they “never” measure leadership development ROI. Similarly, they are not using technology to a great extent, neither on the delivery side nor for programme evaluations, while their transatlantic counterparts in the US do find such use of technology very helpful and more common.
A moving target
It is critical that corporations understand their own needs for leadership development (a “moving target” as new individuals and new strategies are introduced all the time) and customise in a proactive fashion a solution based on these needs. Gone are the days of having a fixed competency wheel for an organisation’s leaders and simply trying, reactively, to build skills to match against its talent model over a several year period. Top performing organisations take this proactive approach to building leadership talent, as it is now recognized that leadership development is not just a tool to help the organisation achieve its strategy, but rather a process by which it can develop a strategy in the first place.
Global business drivers
It is equally important that leadership development professionals understand the global business drivers in their organisation, as these drivers are the basis from which all solutions are ideally designed. Development professionals no longer train leaders to have a well rounded set of skills; they develop leaders to achieve business results. The global aspects are highly relevant as leaders need to know how to manage across boundaries, penetrate foreign markets, and do so with a diverse employee base.
Development of leadership development professionals
Finally, leadership development professionals similarly are investing in their own capabilities and knowledge of their own organisation to understand the business and not simply the training and developmental challenges to maximise their impact. There is a network of internal and external resources that leadership development professionals can tap into as they develop solutions, and although there are challenges of managing such a large and dispersed network, the resources are extremely powerful when used appropriately. Most importantly, organisations are committing their senior management time and financial capital to ensure that leadership development delivers on its promise to move the corporation forward.
About The Study
Leadership Development in European Organizations was produced by Mannaz and The Execsight Institute of Executive Development. In the spring and summer of 2004, both organizations conducted in-person and telephone interviews with 51 European-based corporations, interviewing Heads of Management Training, Chief Learning Officers, and Vice Presidents of Executive Development. In addition to the primary research, a vast collection of books, articles, and industry presentations on the topic were included in the overall research process. In total, 51 organisations with HQs across 9 different countries were included: Belgium (2); Denmark (7); France (7); Germany (9); Luxemburg (1); Norway (1); Sweden (1); Switzerland (5); United Kingdom (18).
More Information about the study
If you want to hear more about the survey and the results, you can contact Jorgen Thorsell, Executive Vice President at Mannaz, tel. +45 4517 6122 or email.
About the Authors
Scott Saslow is the Executive Director of The ExecSight Institute of Executive Development, a professional association of executive development practitioners, service providers, and academic members from throughout the world.
Inger Buus is Director of Mannaz in London. She designs and manages large international projects and is responsible for all UK operations. Ingers qualifications include an MA in French and an MBA specialising in HR from Cranfield School of Management.
