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A Section from "The Continuous Improvement Development Guide"

Volume 2: Committing >

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Develop Leaders Internally (Principle)

Basic Section Information

The success of a Lean organization is heavily dependent upon the strength of its leadership team. A strong group of leaders can engage the workforce, set a great strategy, and guide the company through any crisis that it faces.

With poor leaders, the opposite is true. Employees have a bad relationship with their boss, resulting in a lack of engagement. Frontline leaders are slow to make decisions, or chronically make ones that are at odds with the continuous improvement culture you are trying to cultivate. Senior managers act without a focus on developing the processes that keep the company humming along. The bottom line is that the strength of the leadership team is closely correlated to the success of your continuous improvement efforts and to the company’s long term health.

That should come as no shock to anybody. Strong leaders in nearly any organization play a huge role in the success of the organization. What is different within a continuous improvement culture, however, is the preferred source of those leaders. Because the cultures of companies that are doing Lean tend to be very unique, it is important to develop a leadership funnel within the organization. This steady stream of new leaders helps drive growth and replaces leaders that leave the company through any form of attrition.

More importantly, hiring from within for leadership positions reduces risk and lowers costs. There is a shorter learning curve. There is less of a chance of a poor hiring decision causing problems. Openings get filled faster. The cost of hiring is lower. Most importantly, you have confidence that the new leader’s understanding of Lean is in alignment with your company’s.

Prerequisites

There is no specific prerequisite to this principle. It is presented early in this manual because the principle will guide many of your actions and decisions in the coming months.

Section Details

Estimated Time for Section: Ongoing

Difficulty: Medium

Risk: High.

Materials Required

  • No special materials are required for this section.

 

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Detailed Section Information

The main problem with failing to develop a leadership funnel is cost. First of all, there are recruiting costs. While all hiring activities have some costs associated with them, the costs rise in lockstep with the seniority of the position. At high levels these costs are often in the form of headhunter fees. But if the recruiting is done by the HR department, there can still be considerable expense in finding and hiring the right person. Generally speaking, the higher up somebody is an organization the more effort must be spent hiring them. A greater number of candidates are interviewed by larger interview teams. This is a direct function of the higher risk of a poor hiring decision.

Further, because hiring senior-level leaders is not an everyday activity, it creates spikes in demand which are hard for the human resources department to manage. That variable workload can be disruptive to the flow of the recruiting process at all levels.

The second major cost comes in the form of retraining. As strong as an external leader is, he or she will still not have a thorough understanding of how things are done within your organization. That means it can be a challenge for them to hit the ground running.

The final large cost is associated with mis-hired personnel. Hiring externally is a far greater gamble than hiring from within the organization. To add insult to injury, when a person is mis-hired, the whole recruiting process has to start over again.

For these reasons developing an internal funnel to cultivate leaders can significantly reduce your costs of building a strong management team.

“Develop Leaders Internally” is the rule associated with the principle that actively managing the growth of current and future leaders within the company will reduce the impact of poor leadership on your continuous improvement efforts.

There are three main components to developing a strong leadership funnel. The first is identifying the future leadership needs of the organization. The second is to identify candidates from within the company who can eventually fill those needs. The third and final component is developing the potential leaders that you identified. Obviously, shortages of internal candidates means that external candidates will be required to close the gaps.

Keep in mind that the funnel does not stop for an individual when they get promoted to a new position. That person may have been identified to become…

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The program leader faces a particularly challenging task in promoting this principle. In a nutshell, he or she will be dictating to the senior staff not only who they hire, but how they spend their time.

Many senior leaders spend far too few hours of the week developing their subordinates…and their own replacements. For some, it is just not a priority. They have a lot on their plate, and they just don’t emphasize mentoring. For others, though, it is actually a conscious decision.

Some leaders are insecure, and don’t want to create competition for themselves. They don’t want to give their boss a viable alternative. The reality is that leaders who fall into this category are…

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  • Be aware of the perception of unfairness. The people in the leadership funnel will be given more opportunities to do things outside of their normal job description. This can be perceived as favoritism.
  • A leadership funnel can be a self-fulfilling prophecy. Once a person is identified as a potential leader, there is more…

The rest of this section is only available as part of a premium product. Individual and corporate licenses are available below.

Supporting Content and Additional Information

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