Good reads: "Leader Machines", Fortune, Oct. 2007

In this article, Geoff Colvin demonstrates the power of a leadership-building culture. Instructive excerpts:

"Your competition can copy every advantage you've got -- except one. That's why the world's best companies are realizing that no matter what business they're in, their real business is building leaders. Here's how the champs are doing it."

Fortune teamed with Hewitt HR outsourcing/consulting, and RBL Group to study how companies develop leaders, and which are doing it best. The top "academy companies" --those whose employees move on to top leadership in many best-performing large corporations -- include GE and Procter & Gamble "Says Hewitt's (Robert) Gandossy: 'companies that provide people with opportunities to learn and grow become talent magnets, drawing scarce talent in droves.' By continually attracting the most promising graduates and then developing them, these firms become higher-performing organizations, enhancing their ability to attract the best -- a self-reinforcing cycle that makes the company more dominant every year." Traits shared by the top companies for leadership development:

Invest time and Money:

"At GE, Immelt reviews the top 600. Bill Hawkins of Medtronic (No. 12) spends 50 percent of his time on people issues, and many of the other CEOs reported similar percentages -- making it the largest commitment of time they have." The University of Michigan's Noel Tichy, an acknowledged authority, says checking a CEO's commitment is as simple as looking at the CEO's calendar. "Yet the CEO's time is only the beginning. As those who report directly to the boss see what the focus is, they also become devoted to developing talent, as do their subordinates. It's called the cascading effect.(...) Virtually all of them evaluate executives partly on how well they're developing people."

Identify Promising Leaders Early

GE starts on day one, and many discreetly observe interns to see how they get others to work for and with them.

Choose Assignments Strategically

Eli Lilly (No. 13) president/COO John Lechleiter offers this model: Approximately two-thirds of leadership development is from experience, one-third from mentoring and coaching, and a bit from classroom training.

Develop Leaders Within Their Current Jobs

Divisions struggle when bosses move on after 18-24 months. Nokia (No. 3) and Eli Lilly (No. 13) report great success with current programs that use short-term work assignments and additional assignments outside employees' fields of expertise to develop managers within their current assignments.

Be Passionate About Feedback and Support

Companies on the Fortune list "combine frequent, honest assessment with plent of mentoring and support. So when people are told what skills they need to improve, they're also offered programs or coaching for doing it."

Develop Teams, Not Just Individuals

Immelt says the GE he grew up in did primarily individual training, and that it led to problems. "He'd attend a three week program at Crotonville, but back at work 'I could use only 60 percent what I'd learned because I needed others -- my boss, my IT guy -- to help with the rest.' And maybe they weren't onboard."

Exert Leadership Through Inspiration

How well does it work to make people do what you say by firing and promoting? A.G. Lafley of P&G says, "The command and control model of leadership just won't work 99 percent of the time." Which is why P&G runs a development program called "Inspirational Leadership." American Express similary has "Leadership Inspiring Employee Engagement" and it is mandatory for every VP and above.

Encourage Leaders to be Active in Their Communities

Leaders, the company, and the community can all impact on another in positive ways, benefitting all.

Make Leadership Development Part of the Culture

"Developing leaders isn't a program; it's a way of living. For example, honest feedback has to be culturally okay. At many companies it isn't. Devoting significant time to mentoring has to be accepted. Working for nonprofits has to be encouraged, not just tolerated. Such cultural norms can't be dictated; they have to be in the air." ------ "Good as these companies are, not one of them is satisfied with the way it develops leaders. They all have plans for improvement, mostly by involving more people, working more with teams, and refining their views of what skills tomorrow's leaders will need. None are scaling back." (emphasis added)

Does your company have a culture of leadership development?

Krissi Barr (an alumna of P&G, #2 "Top Company for Leaders") can help. Call her at 513-470-8980 or e-mail krissi@barrcorporatesuccess.com. Or for more information, please visit our website.