With a string of senior executives leaving Infosys and developments pointing to an outsider succeeding S.D. Shibulal as the first non-founder CEO, questions are being raised about why the famed Infosys Leadership Institute could not produce a CEO from within. (Matt Barney, former VP and Director, Infosys Leadership Institute, even wrote a book titled Leadership @Infosys ).

Do investments in leader development — through high-profile, in-house leader development programmes or tie-ups with leading B-schools or through in-house leadership institutions — guarantee the next CEO will come from within? What really contributes to the development of a CEO?

This is an interesting question, relevant, not just to Infosys but to hundreds of organisations that invest heavily in leader development.

I was once engaged by a very large Indian conglomerate to study the effectiveness of one of their flagship leader development programmes. This programme was, in fact, considered the core engine of their efforts to develop a pipeline of leaders. The unfortunate thing was that over 25 per cent of the people who had been hand-picked to take part in the programme had left the group. So, what was really wrong with the programme and the way it was implemented?

As I started work on the assignment, some questions came to mind: There seem to be so many leaders in an organisation, leading large businesses, many of whom have grown from within. If we can crack the code of how they were created, we would have answered the larger question: how to create leaders, and how this programme could aid in the creation process. I asked many of the Managing Directors in the group this same question. What they revealed to me was not just fascinating but also very educative.

The biggest learning for me was understanding the difference between paying attention to governing variables and focussing on action strategies when solving the problem of leader development. These two terms were used by Chris Argyris, when he explained the concept of single-loop learning (looking at action strategies) and double-loop learning (factoring in governing variables).

In the context of leader development, governing variables refer to all aspects of the institutional eco-system required to identify, develop and nurture leaders. Action strategies include specific aspects of leader development interventions.

In the case of the conglomerate mentioned earlier, I discovered that in the early days, the group was almost intuitively paying great attention to key governing variables, with great success.

Almost always, someone with potential and readiness to take the plunge and commit to the long term was personally identified by the immediate manager or a member of the promoter family or board. This is where the sponsorship process seems to have begun.

These individuals were inevitably moved across functions and received significant cross-functional exposure early in their careers. Many of these moves were, of course, driven by a hard business need.

Then came a time when each one of them got that big career break or life-altering job challenge. They may have been assigned a new role in the same business or in a new business or to a mission-critical project.

As individuals took on this challenge and succeeded or proved themselves, they gained visibility at the board level and won the trust and confidence of one or more members of the board or promoter family. This translated into a certain freedom and latitude to fail, which was always inevitable in big job changes and, in turn, laid the foundation for one or more significant role changes.

It is at this stage that the organisation started making significant investments in their learning, often through participation in global programmes, in addition to other development interventions.

From now on, these individuals became part of the core leadership group and enjoyed close and frequent and educative interactions with the board and members of the promoter family.

These six critical steps seemed to strongly characterise the growth and ascent of almost every business leader in the group. Against this backdrop, the specific flagship leader development programme featured as a useful action strategy but not as a governing variable.

Let us now get back to our original question of whether leadership institutes actually produce leaders! GE has such an institute. So do the Aditya Birla group, the Tatas and several public sector banks, apart from scores of others. There is nothing wrong with them. But to assume that if you have a leadership institute, you can develop your future CEOs and CXOs would be a mistake. A leadership institute or the use of psychometric tools to assess potential leaders, or the use of 360 degree feedback, tie-ups with management institutes, executive coaches or talent managers to monitor all this can, at best, be described as good action strategies.

They can help achieve “local optimisation” within given constraints.

There are at least three questions to ask ourselves (at a governing variable level) to know if we are geared to developing leaders:

Are the senior-most executives in the organisation, starting with the CEO, actively involved in identifying and grooming specific individuals for leadership? This will mean they are willing to put their professional reputation at stake to underwrite the potential of the individuals they are grooming. Do they have a list of people they believe in?

Are these senior leaders taking well-thought-through and deliberate actions to convert potential into performance? This will mean they are giving potential top management candidates critical job changes, helping them develop varied experiences, providing them candid feedback and, of course, having powerful conversations with them.

Are these senior leaders giving their potential leaders the permission to fail? Every learner, irrespective of level or competence, fails. This is especially true in business, where the environment is a huge unknown variable. There will be board and public scrutiny, and performance pressures too. But the hallmark of a real sponsor of talent is the ability to stand behind the ones you are mentoring, support them and even take the flak when they fail.

If a large number of senior executives whom you promoted into leadership roles are underperforming and need to be removed, it means there has been a failure in the sponsorship process.

None of these three questions can be answered by the CHRO or the CLO or the head of a leadership institute. Developing leaders is the task of leadership.

I must however add that the focus of this deliberation is about developing leaders at the very top. As you go down the organisation, you need leaders at every level — a team lead or an area sales manager is a leader as well. Action strategies can make a good difference at these levels. However, as you go higher, such strategies have diminishing returns. It is the variables that truly matter.

(The writer is the founder of totus consulting, a strategic HR consulting firm. He is also Vice-Chairman of CFI, an Executive Coaching institution)

Related Topics