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Strong Bench Readiness May be Rare, but It’s Not an Accident

By Evan Sinar, Ph.D.

Evan Sinar, Ph.D. “What percentage of your organization's critical business leadership roles could be immediately filled by internal candidates?”

We asked this question in our Global Leadership Forecast 2014|2015, and over 1,500 HR professionals told us where they stood—out of every 100 critical positions, for how many can new leaders step into…today? It’s a simple indicator of broad risk: either capable leaders are there when you need them, or they’re not. The average response to the question above was only 46 percent—more than half the time, organizations face the choice of placing an untested internal leader in the role, or absorbing the heavy cost and time of hiring externally. With time to reach full performance ranging from 19 months for the average frontline leader, to 23 months at the mid-level, to 32 months at the senior level, it can take an organization years to learn the true capability of their newly hired or placed leaders—and the true risks of a flawed talent pipeline.

Pipeline or Pipe Dream?The consequences of a clogged or broken talent pipeline of internal leadership talent are severe—the percentage ready-now metric was a key barometer of leadership strength and an organization’s financial success—but also avoidable. Eight talent management practices differentiated the well-prepared organizations from their lagging peers:

  1. Leaders don’t just learn skills, they practice and receive feedback on them with their managers
  2. Competencies that underlie leadership success are clearly defined
  3. Competencies are the foundation for multiple (not just isolated) talent management systems
  4. Leader performance expectations cascade directly from the organization’s strategy
  5. A systematic process is used to determine the quantity and quality of leadership needed
  6. Managers regularly review leaders’ development plans
  7. Formal programs are in place to ensure smooth leadership transitions
  8. Leaders consistently have high-quality, effective development plans

Each of these practices was individually linked to a sizable swing in an organization’s state of leader readiness. But, their cumulative effect is much stronger: in the rare cases (only about one in seven organizations) when every one of these practices was in place, these organizations could fill 59 percent of their critical positions immediately. When none were in place (about one in 15 organizations), this percentage was only 31 percent on average—nearly a 30 percent swing.

We also found two scenarios when high-growth or multinational companies are especially at risk:

  • First, for organizations growing aggressively over the past three years, cascading leader performance expectations from the organization’s strategy had a particularly strong impact. That is, for companies in growth mode, the strategy-expectations disconnect is especially crippling.
  • Second, for large multinationals (10,000+ employees; operations spanning at least three countries), leaders practicing and receiving feedback on key skills had the strongest link to higher leader readiness. For these organizations, leadership development doesn’t end in the classroom—it is reinforced and extended by high-caliber manager support.

Strong bench readiness may be rare, but it’s not an accident. Specific, well-orchestrated talent management practices make the difference between an organization that can thrive, grow, and weather change on the strength of its current and future leaders, and one that is only a few months—and a few departing leaders—away from being exposed as fragile, hollow, and desperately ill-equipped.

See more details about proactive pipeline management, or download the full Global Leadership Forecast research study.

Evan Sinar, Ph.D., is the chief scientist and director of DDI’s Center for Analytics and Behavioral Research (CABER).

Posted: 10 Nov, 2014,
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