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What Research Says About Getting the Most from Your Leadership Pipeline

Evan Sinar, Ph.D.

Organizations understand the importance of having a robust leadership pipeline that produces a quantity of leaders who can readily transition into more senior roles at the next level. As such, they often employ a pipeline approach when formulating and executing their leadership development strategies.

Getting the most from your leadership pipelineIn our recently published guide, Leadership Practices: What’s Proven. What’s “Worth Less.” we drew on DDI’s Leadership Databank, which includes data gathered from over 62,000 leaders and HR professionals from more than 2,400 organizations, to examine 19 leadership practices across eight categories. One of the categories we examined was how to get the most from an organization’s leadership pipeline when it comes to development.

We looked at two practices: taking less than a full pipeline approach to development and event-centric development. Here’s what we found.

The downside of less than a full pipeline approach

While organizations may understand the importance of taking a full pipeline approach to developing leaders—systematically developing leaders across the frontline, mid-, and senior levels—for reasons that may be associated with costs and complexity, they often settle for an initiative that is more limited in breadth and scope. Instead of targeting all three levels, they opt to develop just one or two levels.

What’s more, even when they do develop across all three levels, not all of these programs will be effective.

Our research makes a resoundingly strong case for having effective development programs across the full pipeline. Looking at 150 publicly traded companies and using, for comparison, a financial composite that included profitability, earnings per share, five-year rate of return to investors, and stockholder equity, we found that those organizations that successfully extend their leadership development programs across all three levels financially outperform their peers!

As the graphic below shows, there was a two-percentile point difference in average financial performance between those organizations that had a successful leadership development program in place at a single level and those that lacked an effective development program at any level. There was also another two-percentile point increase for organizations that had highly effective programs at two levels instead of one (with the 50th percentile as average across all companies).

But when companies have effective programs at all three levels, they realize a whopping 17 percentile increase!

Company Financial Performance and Execution of Leadership Development Across the Pipeline
Company financial performance of leadership development across the pipeline
Number of Levels with Highly Effective Leadership Development in Place

The takeaway: When organizations focus on only part of the pipeline by implementing an effective leadership development program, the results of their efforts fall far short of what they could be. That’s why we concluded that anything less than a full pipeline approach is a “worth less” practice.

Moving away from event-centric development

Another practice we sought to evaluate through DDI’s Leadership Databank was creating carefully sequenced learning paths instead of traditional “event”-centric development.

We found that when a carefully sequenced learning path (i.e., a learning journey) is used, the advantages are striking.

Organizations that position leadership development as a planned integrated journey are 2.5 times more likely to be in the top 20 percent of organizations on the same financial composite described above.  In fact, we found that this was the practice that was most strongly linked to financial performance.

The takeaway: Event-centric leadership development doesn’t deliver the same return as a well-designed leadership journey. Which approach are you using in your organization?

Evan Sinar, Ph.D.Evan Sinar, Ph.D. is the Chief Scientist and Vice President of the Center for Analytics and Behavioral Research (CABER). Evan is the lead researcher for the Global Leadership Forecast 2017|2018 and is a frequent author and presenter on leadership assessment and development, talent management analytics, data visualization, and workplace technology.

Explore all of the categories and practices included in Leadership Practices: What’s Proven. What’s “Worth Less.”

Posted: 14 Sep, 2017,
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