HR Malaysia

Leadership Development for SMBs

by Daniel R. Tobin | Chief Learning Officer

Most of the literature and examples of best practices for developing a company’s next generation of leaders cite the efforts of large companies as examples. These large companies have large leadership development staffs, impressive budgets and often a dedicated facility for leadership development activities.

Few small to midsized companies – defined here as having fewer than 5,000 employees – have the resources, both financial and personnel, to even think about replicating the approaches to leadership development used in larger companies. In smaller companies, leadership development is at best the responsibility of the HR group, which always has many other responsibilities. At worst, nobody in these companies is thinking about leadership development except for an occasional discussion in the succession planning process.

For these smaller companies, the development of the next generation of leaders cannot be focused on a single leadership development program or experience. Leadership skills are necessary, but they are not sufficient to create a new generation of leaders. Along with leadership skills, this next generation must develop its business acumen, learn and practice execution, and broaden its knowledge and skills from functional specialties to a broader range of strategic thinking and planning.

A comprehensive approach to leadership development that can work for many small and midsized companies runs over a period of two years and has four basic components:

1. Quarterly education sessions:
These are focused on a wide variety of topics, ranging from business and financial acumen to strategic thinking.

2. Action learning projects:
These are each directly tied to the topic of an education session. Some projects are assigned to teams, others to individual participants in the program. The results of the projects are then presented to a panel of company executives at the start of the next quarterly education session.

3. 360 assessments and individual development plans:
These are produced for each program participant.

4. Mentoring and coaching:
Each participant is assigned a mentor from the company’s executive team and, as needed, coaches are assigned to individual participants to help them develop knowledge and skills not included in the overall program, but which are identified as a personal need.

By involving company executives in the program, in a variety of roles, they will get to see their high-potential employees in action and, more important, will be able to test their leadership skills through action learning projects before promoting them. Executives who participate in the program feel that they get a much better line of sight into the company’s talent than they otherwise would have had, and they end up feeling more connected to the front lines of the business.

A common question is: How much is this going to cost the company? The answer is that no matter how much it costs, the entire program will cost much less than making poor promotional decisions without it.

Here are some reasonable expectations for results from using this leadership model:

a) Expanding a company’s pool of talent for use in succession planning.
b) Increasing retention of top talent.
c) Addressing long-standing company challenges.
d) Making top talent more visible to company executives.
e) Increasing the performance potential of participants in their current jobs.
f) Weeding out supposed high-potentials who fail to perform in the program.

[About the Author: Daniel Tobin is a consultant on leadership development programs and corporate learning strategies, as well as the author of "Feeding Your Leadership Pipeline: How to Develop the Next Generation of Leaders in Small to Mid-Sized Companies."]