That some companies produce more leaders and better workers than other firms is a known fact. Now, it’s clear how they do it. The best companies for leadership, it is seen, take a determined and disciplined approach to helping leaders develop and rise within their organisations. The findings were released in the Best Companies for Leadership Study and Top 20 list, by Hay Group.
About 80 per cent of the top 20 companies had established clear career paths for their employees, compared with only 48 per cent of other companies, the study found. Similarly, 80 per cent of the top 20 were well ahead of their peer groups, as they provided career development experience for those with the highest potential, ensuring the company had the right people with right skills to fill critical roles. Procter & Gamble headed the Top 20 list, followed by General Electric, Coca-Cola and IBM.
Developing leaders
“This year’s research shows that the world’s leading organisations purposefully develop leaders, who can drive innovation and transform organisations,” said Ruth Malloy, global managing director of Hay Group's Leadership and Talent Practice and co-leader of the Best Companies for Leadership study. “These best-in-class organisations provide non-traditional, more diverse career paths and train high-potential employees to meet specific business challenges. They also develop skills required to help their organisations succeed in today's increasingly volatile, global environment,” she added.
Not only do the top 20 companies provide clearly defined and varied routes to leadership, they also intentionally seek to develop diverse leaders. Half of the top 20 firms offer special leadership development programmes for women, as compared with 13 per cent of all other companies. Also, 40 per cent of the Top 20 have programmes geared toward diverse groups, compared with only 11 per cent of all other companies.
The top companies also tend to make leadership development programmes available at all experience levels (83 per cent compared to 57 per cent). Correspondingly, the top 20 are more likely to report diversity among their senior ranks (68 per cent, as compared with 53 per cent of all other companies).
Purpose-Built Leaders
At the top 20 companies, flexibility to respond to economic changes was identified as a top challenge for leaders over the next 12 months, along with the ability to capitalise on opportunities within emerging markets.
Surprisingly, in an era where organisations are increasingly turning to online learning, the top 20 companies still prefer classroom-based leadership training (used by 74 per cent of the top 20 vs. 51 per cent of all other companies), with mentoring by senior staff and coaching from internal resources highly prioritised.