HOW TO BUILD GLOBAL LEADERS?

To prepare someone to lead globally, development options must equip leaders with the right combination of skills around collaboration and influence.

Most curriculum to develop global leadership skills and competencies focuses on the same points: developing and executing strategic business plans; communicating and working effectively with diverse internal and external colleagues and customers; and dealing with change, complexity and uncertainty in a confident manner.

While all of this is important, high-performance organizations know four elements are essential for effective global leadership development and market performance:

• Immersion in cultures and customs for local markets.
• Focus on collaboration and influence.
• Selection made by objective behavioral evidence.
• Curriculum based on the long-term.

A June 2014 study from the Institute for Corporate Productivity and the American Management Association, “Global Leadership Development: Preparing Leaders for a Globalized Market” found a mixed bag in terms of year-over-year progress from employers equipping their leaders to perform in a global environment (Editor’s note: The author works for the Institute for Corporate Productivity). On one hand, the proportion of firms addressing global leadership development — with a distinct program or embedded within a general leadership development curriculum — has grown to 44 percent from 31 percent in the past five years. But 21 percent of companies perceive their GLD programs as effective to a high or very high, despite the fact that success in the global business environment is an imperative.

The study found four times as many high-performance organizations — defined as the top 25 percent based on multi-year growth trends in revenue, profit, market share and customers satisfaction — are highly effective at developing leaders with global skills and competencies than their lower-performing counterparts, 32 percent vs. 8 percent respectively. Research revealed a distinct set of practices that distinguish these high-performers, and have a strong positive correlation to market performance and global leadership development effectiveness. 

The Value of Local Intel
Global offerings in GLD programs are often overshadowed by a focus on soft communication and business skills, but the tide is turning, according to the study. Organizations are including local perspectives specific to key markets when developing GLD curriculum by:

• Including interviews with successful global leaders to determine common behaviors/traits.
• Consulting with in-country resources to determine region-specific needs.
• Ensuring consistency with program delivery on a global basis.

Organizations don’t have to exhaust resources on these practices. Cultural fluency can be achieved without physical immersion in a region anytime with technology.For instance, create virtual rotational programs that deliver consistent cultural and regional-specific learning. Such learning may include cross-cultural coaching and mentoring, webcasts from local academicians, participation in videoconference meetings for global teams, audio presentations for language learning, and specialized video series via YouTube or Vimeo.

Global IT applications company Oracle Corp. ensures its leaders worldwide receive a consistent offering that is regionally relevant by involving local talent, said Sandy Elvington, senior leadership consultant. Oracle wanted to deliver leadership training globally, but wanted to build that capability within its own learning organization. To that end, the company chose a global vendor that required facilitators be certified in program delivery.

Global content is included in the core leadership development program, which covers critical pieces for frontline managers worldwide, such as transitioning to management for first-time managers, communication, building teams and networking to build a knowledge base. A global team — including members from Asia-Pacific; Europe, India; Latin America; Middle East and Africa; and the U.S. — develops the program, weighing feedback and input from local Oracle employees.

“Whatever we develop must play not only in the U.S., but also in other countries,” Elvington said. “You can’t create a program to roll out globally with U.S.-centric people; weengage all teams across the globe to make for a greater success rate.”

The New Global Leader
High-performance organizations are more likely to define leaders based on influence rather than authority. They define influence by the ability to persuade others to consider or adopt a point of view and the ability to obtain a positive action from others. However, excellence in work performance trumps both competencies and has the greatest correlation to market performance and GLD effectiveness.

Conversely, two definitions detract from both market performance and effective global leadership development and show influence does not look like: “direct reporting authority over others” and “personal reputation.” These two definitions of influence are more likely to be found in low-performance organizations and showed a negative correlation to market performance and GLD effectiveness. It’s about leading by example.

As organizations develop leaders who must operate in increasingly matrixed and project-oriented work environments, it’s important to develop leaders who can collaborate with various backgrounds, demographics and perspectives. Therefore, GLD should focus on teaching and coaching individuals with diverse learning styles, and addressing and resolving performance issues of virtual team members.

Renata Viskanta, director of learning and development and leadership and organization effectiveness at W.W. Grainger Inc., said the global organization helps its leaders develop influencing skills via a nine-month global leadership development process. Participants spend 40 to 60 percent of their time in a comprehensive action learning process and must delegate their high-priority responsibilities to others and help stretch those individuals to take on expanded roles.

“The action learning team itself works on an enterprisewide business challenge and receives intensive focus on developing their leadership capabilities,” Viskanta said. “At year end, the team’s final presentation tells a story, in equal measure, about the strategy and implementation plan they’ve created as well as their leadership development journey. It’s a high-visibility development opportunity and also a great tool for introducing the board to upcoming talent.”

Many organizations use recommendations from senior leadership or an employee’s direct supervisor to select participants for GLD, but neither of these methods is positively correlated to market performance or global leadership development effectiveness. Such approaches can be highly subjective and undermine confidence in the selection process. High-performance organizations base global leadership candidacy on objective evidence: recommendation from a mentor, sponsor, or coach; performance history; or skills or behavioral assessments.

The 2013 iteration of this study showed that competency gaps identified through strategic workforce planning was a key driver for GLD processes that distinguished high-performance organizations from low-performance organizations. This year’s data reveal several additional future-focused practices for creating curriculum, and all have strong correlations both to market performance and effective GLD:

• Determining future-focused critical roles core to the business’ longer-term success but difficult to fill.
• Identifying specific skills needed in future-focused critical roles.
• Conducting an internal-skills inventory to determine longer-term gaps in critical roles.
• Conducting environmental scanning to determine external skills shortages in future-focused key markets.

Global agriculture/industrial supplier Cargill benefits from having CEO and top-of-the-house support for GLD — a practice highly correlated to market performance and GLD effectiveness. “We get regular senior-leader perspective by having leaders teach leaders across our top programs,” said Ian Stephenson, vice president of organizational effectiveness at Cargill. “They shape the curriculum they are delivering, and we tap them for the capabilities we need to build next.”

Cargill also uses strategic partnerships with customers and other outside resources to helpdefine skills needed five to seven years out. Stephenson said seven years ago, as the rate of change continued to accelerate and complexity increased, leaders identified the need to build stronger change leadership and systems thinking capabilities. “We benefit today from having developed leaders with a change mindset and skill set and tool set,” he said.

Ideally, organizations should create a dedicated GLD program. For organizations lacking the necessary resources, or those for which GLD doesn’t fit the business model, consider a curriculum that addresses global skills and competencies within a general leadership development program, which also has a strong correlation to GLD effectiveness.

Following are three recommendations for organizations to prepare leaders to manage and operate effectively in a global environment.

1. Create a senior-leadership development council. The senior leadership team must own global leadership development. The primary cause for ineffective global leadership development is lack of attention from CEOs and other senior leaders. The CEO must chair the council, which meets quarterly to identify, assess, get to know, mentor and teach top talent. The council defines specific behaviors; decides on interventions, such as removing barriers, strategic recruiting and executive education investments; agrees on officer succession; and builds talent pipelines. These tasks cannot be delegated.

2. Replace competency models with behavioral models for every level of leadership. The Institute for Corporate Productivity’s research has consistently shown that ensuring leadership behavior is consistent with strategy as a practice that is extremely highly correlated with market performance. However, most GLD programs are anchored in a competency model developed by HR professionals. Competencies describe contributing factors that enable leaders to function in their role, such as knowledge, experience, skill and attitude. Behaviors, on the other hand, are demonstrated actions, attitudes or activities leaders exhibit to show proficiency in a professional skill. Behaviors are a better gauge for leadership effectiveness because they are observable and can be measured.

3. Address current and future needs.The majority of leadership models and curriculum today are based on the past and don’t leverage data to anticipate changes in the organization or its markets. The senior leadership team should have data pertaining to gaps in workforce supply and demand based on future-focused critical roles so they can determine which leadership behaviors, at each leadership level, are needed to drive the organization forward.

Like all investments, the GLD program must be reviewed and managed with vigor. Quality of movement — which provides data on internal placement rates, promotion rates and other organizational movements — is important. It is especially critical to monitor assignments in other countries and to follow up on performance after a move.

A subset of this is to examine how many individuals who complete the GLD program fill key roles. The quality of these “hit rates” can help reveal deficiencies in GLD selections or development processes, as well as post-program support resources.

Quality of attrition — which tracks departures from critical roles or among those who have been identified as high potential — is also a key metric. This reveals undesirable, voluntary turnover, which has a high cost on the business, including lost revenue and income, as well as decreased employee engagement and morale.