Leadership development: concept, methods, goals and practical tips

What is management development?

Executive development is the targeted promotion of competencies, behaviors, and attitudes of executives and a subarea of human resources development. The goal of management development is to set a framework that enables managers to make their maximum contribution to the company’s success.

Why is leadership development important and how does it work?

Numerous studies demonstrate the strong influence of leadership on organizational performance, both directly in daily work with employees and indirectly as catalysts for strategic initiatives. It is also relevant for the transformation of companies, their business models, organizations or cultures. Continuous work on leadership in the form of leadership development is therefore coming to the fore in many companies. But how does leadership development work?

If you want to answer this question in an impact-oriented way, you would have to formulate it like this: “How can leaders be supported in mastering the challenges of the VUCA world and in transforming organizations sustainably?”

Here, the first thing that often comes to mind is empowering leaders through (customized) training and leadership development programs (often called learning journeys). However, this is only one aspect of leadership development. It makes more sense to approach the topic comprehensively. Instead of training individual managers, it is more effective to develop an ecosystem for improving leadership and collaboration culture throughout the company. A holistic approach that combines people development and organizational development increases the impact of leadership as a catalyst for sustainable business success rooted in a strong corporate culture.

In addition to training and learning programs, holistic leadership development includes other elements such as:

• E-learning platforms with curated collections of learning content for self-directed learning.
• Feedback, coaching, and mentoring
• Development-oriented tasks and projects
• Exchange/networking formats
• Change initiatives and campaigns
• HR tools/processes such as recruiting, onboarding, placement, career paths, talent and performance management.

These elements combine “on/near/off-the-job” development opportunities. Their interaction works toward improving leadership attitudes and behaviors. Thus, they mutually reinforce each other’s effects—as in a biological ecosystem.

But before delving into the question of how (you develop leaders), the question of what (are the expectations of leadership) should first be answered.

What are requirements for effective leadership?

Some, such as agile leadership, are present at a majority of companies, while others, such as sustainable and ethical leadership, are pursued only sporadically. In addition to the various leadership concepts, more or less established trends are currently being discussed again and again. While trends such as change management are anything but new and, if anything, are only being supplemented by new facets, it is also possible to observe completely new trends that have actually only been on the market for a relatively short time. For example, the topic of hybrid work environments only became prominent in the wake of the pandemic. There are topics, such as diversity and inclusion, that are still in the early stages of implementation, even though they have been recognized for some time.

What leadership attitudes and leadership competencies do leaders need to serve these trends? Some competencies continue to be important, such as:

• Engaging in constant self-reflection and being a role model
• Making important decisions
• Delegating responsibilities (rather than tasks)
• Developing employees
• Driving change by balancing top-down and bottom-up elements

Other leadership competencies have been added or are now more emphasized. These include:

• Dealing with changed status and transfer of traditional leadership tasks to third parties
• Creating a customer- and employee-oriented vision and purpose and communicating them in a motivating way
• Creating entrepreneurial and creative environments
• Dealing with diverse interface partners and leading in the ecosystem
• Curate and develop entire teams

But how do you effectively improve leadership culture in times of scarce human and financial resources with a simultaneous desire for quick impact?

How do you develop leaders?

Effective leadership development essentially consists of four building blocks:

• Leadership principles: A common understanding shared throughout the organization of what is required of good leadership, and thus the foundation and orientation for leadership development; leadership principles are alternatively referred to as leadership understanding, leadership model, leadership competencies, guiding principles, or leadership essentials, and are concretized with the help of behavioral examples (or behavioral anchors).
• Leadership architecture as an overall offering for leadership development: A tailored, business-oriented and coherent portfolio for executives that pays attention to the desired leadership behavior (as expressed in Leadership Principles) and at the same time addresses the individual needs of executives; elements (on/near/off-the-job) include, as already described in the first chapter , in addition to training/programs/learning journeys, as well as, for example, e-learning offerings, digital engagement platforms, feedback, executive coaching and mentoring offerings, and change formats such as leadership conferences or cascade workshops. Furthermore, relevant interfaces to HR tools (recruiting, placement, talent and performance management, etc.) are designed to make leadership development more effective.
• Leadership development program: A core of leadership architecture is to design individual leadership learning journeys; these programs are typically designed in a blended learning format and address a leadership target group such as lower/middle/upper management or a leadership topic such as digital transformation or resilient leadership; they empower on three levels: Knowledge, Attitudes, Behavior.
• Organizational framework: The conditions for realizing the full potential of systematic leadership development; components include, for example, budgets and IT infrastructure for learning (LXP, LMS, apps, etc.), regulatory frameworks such as guidelines for learning, trainee resources, HR resources incl. skills for leadership development, general organizational structure (e.g., leadership spans, hierarchy, etc.). Many of these frameworks relate to the “may” or “can” (in the sense of availability) dimension, while the overall architecture addresses the dimensions “can” (in the sense of capabilities) and “want.”

Our overview shows you typical procedures and tips on what is important in the four elements of effective leadership development:

These approaches and methods are now well established in practice and form the canon of leadership development. In addition, we have seen some interesting trends in leadership development in recent years.

What are the trends in leadership development?

Leadership development must produce high-performing teams instead of superheroes.

In most situations, a diverse leadership team makes all the difference. As tasks and leadership become more complex, team composition, development and engagement will become even more important. Thus, one of the most important tasks of a future leader is also to be able work together in a high-performing leadership team.

Leadership development is individual and must take into account the critical moments in a leader’s life cycle.

This includes situations such as first leadership role/onboarding, first (critical) employee/insider discussions, the first time representing one’s own company in public. The goal of management development must be to meet managers with their individual challenges and to accompany them.

Leadership development must ensure that different leadership roles can coexist in an organization.

In addition to the traditional General Manager, many organizations now have new roles, such as Agile Coach, Architects, People Managers, or Platform Owners, who take on specific leadership responsibilities. Occasionally, leaders take on different roles depending on the context and situation.

Leadership development requires true teamwork between business and human resources.

Without a strong role model from the business, the human resources department can hardly be effective. Most leadership development takes place in the workplace and requires, first and foremost, direct reports, colleagues, and senior executives to serve as teachers and mentors. In the future, the modern human resources department will be a coach of leaders and teams, a challenger of top management, and an owner of the leadership development process.

The leadership development function of the future is not a jack-of-all-trades.

The internal goal of leadership development is to be a lean and powerful background function that provides the stage for the business to take the lead. In addition to a clear focus on leadership, providing scalable and cost-effective leadership development offerings that reach executives is the critical success factor for the function’s efficiency and effectiveness.

Wie kann What can leadership development look like specifically in your organization? Case study:

One example of a holistic approach to leadership development from our practice is that of an international automotive supplier. This case was on the cusp of a strategic realignment and transformation with the goal of successfully shaping trends such as e-mobility and Industry 4.0. In order to enable the managers to master the transformation, to actively shape it and to mobilize the employees, we accompanied the management development in several steps:

Development of leadership principles

The project began with the board’s recognition that each and every one of the more than 10,000 managers should help shape the transformation and be empowered to do so. From the board member to the team leader on the shop floor, the goal was a shared understanding of leadership that would serve as a compass for leadership development for transformation. Common leadership principles were needed.

To develop leadership principles, a comprehensive diagnosis of the existing leadership culture was first initiated to identify strengths and development needs, but also to understand local specifics:

• Online survey and workshops in all regions with over 430 participants from all divisions and functions.
• Individual interviews with all members of the Board of Management
• Workshops with employee representatives

The method of broad participation in the analysis phase before the actual start of the project paid off: Throughout the project, managers showed themselves to be highly committed and motivated. The analysis phase also clearly showed the strengths and weaknesses with regard to the prevailing understanding of leadership.

After the analysis phase, the results were further discussed, mirrored, and condensed with various stakeholder groups. This was always done with the close support of the Executive Board and top management.

This resulted in six leadership principles, each of which was specified and described in terms of action by five underlying leadership behaviors.

In the implementation phase, the leadership principles were not only made known, but also integrated into everyday life as a guideline for action. The measures included:

• Use of classic and modern communication channels (brochures, communication materials, videos, company website, social media, etc.).
• Global Leadership Roadshow
• Active involvement of all executives worldwide and implementation of culture-shaping elements (workshops on leadership principles of all board members with their N-1 executives to reflect on leadership behavior and select a leadership principle where improvement would advance the respective business priorities)
• Global cascade of these workshops to the next two levels of leadership
• Integration of leadership behavior check-ins, retros, etc. into existing leadership routines
• Successive adaptation of all relevant HR tools and processes

Since the implementation began, tens of thousands of employees have been asked in regular Pulse Surveys how they perceive leadership in the company. Progress is clearly demonstrable, and targeted adjustments can be made.

Establishing an overall architecture and leadership development programs for empowerment

Particularly at the beginning of the transformation, it was important to equip executives with the necessary mindset, skills, and toolset for the transformation and to anchor the new leadership principles in executives’ day-to-day work with targeted support. To this end, we revised the existing overall architecture for leadership development in three steps:

Overall, the leadership development project ensured that leaders were provided with an effective framework for shaping transformation. At regular intervals, the leadership development components developed are also reevaluated and adjusted as necessary. This is because as business challenges change, so do the framework and requirements for leadership development.

1. Learning architecture for leadership development
   • Inventory of existing architecture and programs
   • Definition of typical leadership challenges along the existing target groups and leadership levels in the organization.
   • Develop an overarching leadership learning architecture to structure leadership and management programs
2. Program landscape for leadership development
   • Description of the central role expectations taking into account the different leadership challenges per level along the leadership principles
   • Comparison of the current program landscape with the developed target picture and derivation of additions and adjustments
   • Proposal for the effective implementation of the learning objectives and leadership essentials in the entire leadership program offering
3. Concept for a leadership program
   • Selection of a target group according to relevant criteria (e.g., learning needs and relevance for establishing new leadership culture)
   • Creation of a concept for a leadership development program as a lighthouse offering:
     • Cornerstones, content objectives and “story” for the program
     • Outline of modular learning interventions and formats (on/near/and off-the-job)
     • Support for provider selection

Seven tips for successful leadership development

The example described is illustrative of our consulting projects for executive development. At the same time, each project is individual and must aim to be tailored to the specific needs of the organization. However, from our consulting experience, there are a number of tips and success factors that apply to all successful leadership development projects:

• Holistic approach (“more than programs”): For leadership development to have a lasting impact, a holistic architecture is necessary. Complementary questions beyond the program question include: What change management initiatives are needed to accompany them? How are the programs embedded in the e-Learning platform? What HR tools work to improve leadership attitudes and behaviors?
• Alignment with business success: Work on leadership should not be an end in itself but should be aligned with business impact. Therefore, the content of leadership development (e.g., leadership principles, training topics) should be dovetailed with business content (e.g., “How can leadership support digital transformation? How can leadership mobilize our employees?”).
• Leadership-centric: To ensure that the offerings are actually used by leaders, the learners, i.e., the addressed leader, should be at the forefront of content and formats (e.g., “How can I quickly address my acute leadership challenge? How can I connect learning with day-to-day business?”). Practical examples, exchange and collegial case consultation, case studies, projects and toolbox for pragmatic use in everyday life have proven effective here.
• Scaling via digitization and multipliers: In times of scarce resources, it is more important than ever to support and scale leadership development. This can be done, for example, via digital broadband formats or via empowered leadership ambassadors from HR and the business.
• Activating the target group: The best offer for executives is of no use if it is not accepted (there can be many reasons for this, including a lack of awareness of the offer). Therefore, one should also think about activation, e.g., via marketing and change measures for the developed end product.
• Commitment and role model function of the top team: A sustainable improvement in the leadership culture can only be achieved if the top team positions leadership as a top priority both internally and externally, continuously works on itself and shows itself as a role model. This also means that companies invest holistically and over several years in leadership development, and that lazy compromises become rarer in practice.
• Measuring success, consequences, and continuous improvement: How do we measure whether our leadership development is successful? This requires defined KPIs and qualitative indicators at the input, output, and outcome levels. These can focus on executive satisfaction, change in behavior (of executives and employees) or measurable impact on the business.

If we can support you in leadership development, please contact Nadeshda Kreya, expert for leadership development in our Berlin office.

Interested in other topics in our leadership consulting field? Learn more.

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