Filling the Leadership Gap through Performance Management

Although the worst of the recent economic turbulence may have subsided, and companies are looking ahead to the future, many have a new issue of top concern: developing their future leaders. At a time when companies are beginning to lose their most experienced leaders due to baby boomer retirements, the ability to identify high-potential employees and provide appropriate training to grow into leadership positions is crucial to organizational success.

The need for leadership development is well recognized by companies – a recent report highlights how spending on corporate training has risen drastically by 15 percent in 2013, accounting for more than $70 billion in the U.S. and over $130 billion globally. One would think that with this enormous investment, companies would have the leadership development process down pat. Yet, that is not the case. Another study shows that a majority of professionals feel their organization will only be able to deliver two-thirds of the leaders they will need in the next three to five years. 

These statistics raise an alarming point. While employers realize the importance of developing the next generation of leaders, there is a serious disconnect in execution. So, what can companies do to better align their development strategies with business goals?

One of the best ways to ensure training dollars have a maximum impact on leadership development is to tie the learning function in with performance management. Using an enterprise performance management solution to facilitate the process can provide the company with key data on the performance, strengths and areas for development of its employees to identify top performers and better understand the potential of each individual. As a result, they can give those high-potentials the targeted, personalized development necessary to fill future leadership gaps, rather than one-sized-fits-all training that will fail to meet the company’s specific needs.

As an added benefit, when performance management is tied to leadership development, the company can create better-focused succession plans and give employees insight into the potential career paths available to them. A comprehensive performance management platform can also help the company maintain accurate records of current employee skills and development plans. Equipped with this insight and an understanding of the talent mobility interests of its employees, the company can be prepared to fill gaps where the skills are needed most and ensure a sustainable pipeline of qualified talent is ready to step into leadership positions.

Successful leadership development is an ongoing and critical challenge for many organizations today. Yet, without the right technology to guide the training process, the company will continue to see its leadership development dollars go out the window. Forward-thinking companies understand the need to combine performance management in the process. Doing so can make sure top performers receive the focused development required to advance through the company and fill the leadership gaps where they are needed most.

These issues and more are discussed in our first of our three part white papers “Lead Me” series titled “Better Performance Management, Better Training Outcomes.” Look for the second and third installments to hit later in April and early May. Happy Reading!

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