Succession Planning: Why Companies Are So Bad at Picking Good Leaders

jaymoran jeffcohnContributed by Jeffrey Cohn and Jay Moran

Many women today worry about what it takes to reach the top. They want to know what they can do to become better leaders.

The old paradigm said that they should adopt a traditionally “masculine” style or set of traits. Very few experts believe that now. In fact, when it comes to important leadership attributes, recent research shows that women have a natural advantage. Where they still suffer (like men) is in trying to understand the source of this power. Now as much as ever, both genders need help with their leadership development efforts.

Just as important – albeit less discussed – is knowing how to choose better leaders. In a way, not having the answer to this question produces the same effect as not knowing how to leverage one’s personal abilities. After all, when we do a poor job of selecting leaders, it stunts our own careers. When a board of directors hires the wrong CEO to run an organization, and that individual fails, it reflects negatively on everyone. When a division president picks a less-than-stellar candidate to manage one of her teams, she will be held to account for that group’s subsequent lack of performance.

Yet, most people don’t focus on this side of the issue. As a result, even today’s best organizations commit some serious errors when it comes to important leadership selection decisions.

The first mistake stems from not knowing what qualities to seek in potential leaders. For decades we have been told that a magnetic personality, or Ivy-League education, or certain style, make all the difference. They don’t. None of these factors is a reliable predictor of leadership success.

Other times we focus on qualities that do matter, but we don’t go far enough to seek a healthy balance. For example, we gravitate toward individuals who possess enormous passion and vision, but who are lacking in good judgment. Or we promote individuals with enormous cognitive skills, but who lack enough empathy to handle sticky social situations.

The second big mistake we make when trying to judge leadership potential is the use of insufficient assessment techniques. In other words, even when we know what to look for, we don’t know how to look. We rely on backward-looking interview questions, or inappropriate personality tests, or letters of reference from those who simply cannot predict how a person will perform in a fundamentally new position. Even the perennial favorite among promotion criteria – prior performance – is not a good indicator of future leadership success. At best, it tells only half the story. A solid manager with ten years of experience in marketing, for example, might be poorly suited for a generalist role that will require her to lead an entire division.

In our book Why Are We Bad at Picking Good Leaders? the two of us answer these crucial “what” and “how” questions. Based on more than fifteen years of experience working with premiere executive education programs and some of the best organizations in the world, we explain how to identify the very best leaders. Here are some highlights that will help your company do a better job in this area…

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Men Who Get It: Jim Wall, Chief Diversity Officer, Deloitte Touche Tohmatsu Limited

Jim_WallBy Melissa J. Anderson (New York City)

“There is a lot of research that shows, and we believe, that diverse teams create better solutions to client problems than homogeneous teams,” explained Jim Wall, Global Chief Diversity Officer for Deloitte.

Wall said he appreciates the firm’s organization’s commitment to diversity – not only because it’s strategically important, but because it has enabled him to do work that is meaningful to him for almost three decades.

“When you go to work, you don’t leave your value system at the door. In my 27 years at Deloitte, I’ve been allowed to do my best work from my value base. And I hope I’ve made an impact,” he said.

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Men Who Get It: Mark Chamberlain, Head of Diversity, Americas, Deutsche Bank

markchamberlainBy Melissa J. Anderson (New York City)

Mark Chamberlain, Head of Diversity for the Americas at Deutsche Bank, said the best piece of advice he received actually came from his grandmother. He explained, “In the early part of the 20th century, women weren’t supposed to go on to higher education, play sports or work outside the home – and she did all that. She said, ‘Only you can make your life interesting. Go out and do it.’”

He continued, “You have to take charge of your life.”

Chamberlain, whose interest in diversity issues started during his time with the Peace Corps working in Mali, now leads Deutsche Bank’s efforts in the Americas to attract and retain diverse talent. The other piece of advice Chamberlain said has impacted his life came from his father. He said, “He told both my sister and me, ‘No matter what you do, do it well.’”

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The “Men Who Get It” Project

Lynn_24P2193_FContributed by Lynn Harris, author of Unwritten Rules: What Women Need to Know About Leading In Today’s Organizations

Since publishing Unwritten Rules: What Women Need To Know About Leading In Today’s Organizations, I’ve worked with others to try to get more women in positions of senior leadership.

Basically all change efforts boil down to the same thing – can we get people to behave differently.

In this case, can we get shareholders to appoint more women to their boards?

Can we get CEO’s to create gender-balanced teams to lead their organizations?

Can we get professional services firms to operate differently so that more women stay and make partner?

Can we get political parties to field equal numbers of men and women candidates, and then get journalists and voters to give women a fair chance?

So far, the answer in all cases has been “no” or “rarely.” Women achieving senior levels of leadership still make the news.

Along with countless other women, I will continue to bang my head against these particular brick walls, trying to convince men who hold most of the power at the top of organizations and governments to accept the business case that gender-balanced teams are better for business and governance.

But the uncomfortable reality is that no matter how many studies indicate that companies with more female senior leaders outperform those with the least in return on equity, return on sales, and return on invested capital, the guys at the top aren’t buying it.

No matter how often we state the case that women and men working together are likely to make better and less risky governance decisions, we still see predominantly male governments and boards.

In 2011, let’s plan to take a different approach in our quest for gender-balanced leadership.

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Men Who Get It: Joe Keefe, President and CEO, Pax World

Joe_KeefeBy Melissa J. Anderson (New York City)

“Pax World is very focused on the notion of gender equality as an investment concept,” said Joe Keefe, President and CEO of Pax World, the first US mutual fund to focus on environmental, social and governance factors (ESG) in investment analysis and decision making.

“Our women’s empowerment platform includes applying a gender lens to all of our funds, while our Global Women’s Equality Fund is the only mutual fund in America focused on investing in companies that are global leaders in advancing gender equality and women’s empowerment. Additionally, our proxy voting policy is straightforward: if the slate of directors is all male, we withhold support and send a letter to the company explaining why and encouraging them to embrace gender diversity.”

He continued, “And it goes beyond putting more women in the boardroom or senior management. Investing in women and girls is a critical strategy for promoting sustainable development and alleviating global poverty.”

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Engaging Men in Culture Change: “Would You Want Your Daughter to Work Here?”

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iStock_000011462846XSmallBy Tina Vasquez (Los Angeles)

A few months ago Deloitte’s Ann Weisberg shared an anecdote with The Glass Hammer that struck a chord with many of us. She relayed the story of a Deloitte senior male partner who spoke on a panel about the issue of gender diversity. He asked the audience, “Would you want your daughters working here? If the answer is no, then you should own part of the solution.” It got us wondering: Could the simple question “Would you want your daughters working here?” change the way companies treat gender diversity?

A Powerful Question

Barbara Adachi is the National Managing Principal for Deloitte’s award-winning Women’s Initiative and yet another believer in the power of the question, “Would you want your daughters working here?” Not only does she believe that considering the question would help senior men see the work environment and culture from a very different and personal perspective, but she’s seen the power of the question at work.

“When we launched the Women’s Initiative in 1993, our CEO Mike Cook had two daughters who were entering the workforce. He personally recognized the importance of women having equal opportunities to advance and he applied this to our culture,” Adachi said. “In a Harvard Business Review article about the Women’s Initiative, [Deloitte Consulting CEO] Doug McCracken cited that the light bulb went on for a male partner when asked, ‘Your daughter is graduating from college. Would you want her to work for a company that has lower expectations for women?’ Suddenly, he got it.”

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A Man’s Undercover Mission into the World of Women Leaders

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_DSC3667Contributed by Mark Palmer, CEO, StreamBase Systems, Inc.

Recently, I attended the World Economic Forum in Davos, Switzerland, the gathering of 2,500 CEOs,heads of state, and visionaries from the arts. At Davos, I saw Chinese vice premier Li Keqiang, Bill Clinton, Bill Gates, met Miss Universe, and participated with the “titans of social media” — as the founders of Twitter, Facebook, MySpace and LinkedIn squared off. Heady stuff. But mid week, I went to a session that eclipsed them all. It was innocuously entitled The Power of the Purse.

Davos is an economic forum and I went for economic interests. But I went to this session for different reasons. At work I’m a CEO, but at home I’m a widow. When my wife died of cancer three years ago I took on a new, foreign role — mom, and so I attended this session with my 7-year-old daughter Ruby in mind. I thought this session might give me some insight into the world as she will encounter it.

But as I took my seat, I felt out of place. There I was, one of a handful of men with 60 of the most accomplished women in the world. I felt like I had mistakenly slipped behind enemy lines, then been cordially invited to an intimate power lunch in the general’s tent. The panel included Sheryl Sandberg, COO of Facebook, author Margaret Atwood, and Laura D’Andrea Tyson, former chair of Bill Clinton’s Council of Economic Advisors.

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Why it is Important for Men to Support Women Breaking the Glass Ceiling

glass ceilingBy Dr. Eric Shoars, author Women Under Glass: The Secret Nature of Glass Ceilings and the Steps to Overcome Them

When I began researching glass ceilings there were questions as to why a man was tackling the issue of in the first place. After all, this is a women’s issue, isn’t it?

My personal reason for supporting women breaking glass ceilings is very simple. My mom was part of the first all-women insurance sales team in Iowa for American Mutual Life in the early 1960s. Her career aspirations were thwarted due to factors related to the glass ceiling. Mom is 82 now and the question “what might have been” often comes to mind when I think of how far my mom’s career could have gone if not for the artificial barriers that held her back.

Now, as I look at my step-daughter, nieces, and great-nieces, I don’t want to have to look at their careers and ask, “What might have been?” But that’s me. Why, then, should other men take up the cause? Quite simply, it is in the best interests of our economy and our society to do so.

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