Leadership Pipeline

Leadership Pipeline
by Ram Charan, Stephen Drotter and James Noel

This book can be used as a how-to for managers as they are promoted to increasing levels of responsibility – and for more senior level leadership in assessing the potential abilities a of managers being considered for promotion. The framework offered enhances understanding what skills managers will need to develop, and will help assess those in the pipeline to know what particular new strengths will be required. Though the title may seem to imply succession planning, the focus is more on the necessary skills for developing success in the next level of management.

The optimistic message is that with careful assessment of current competencies and an awareness of the key skills to advance to the next level of complexity, managers can be developed successfully from within. The authors’ define 7 levels of management, and identify the requirements to successfully navigate the six transitions to the top. These levels offer useful distinctions, and they are common to many types of businesses. The authors even take the time to explain how the same principles can be applied to a smaller company with fewer layers. While the goal of the book is ostensibly to help companies build capacity among their managers, the value is so broad it should be read by any senior level manager responsible for a dynamic business department or business unit, not just someone who regards their responsibility to be succession planning.

The authors’ real contribution is to distinguish the changing target of responsibility as you go up the ladder. For example, managers of managers “need to shift their accountability focus” from individual contributor to the quality of management that their managers provide to their staff. This is an extremely important distinction and one not frequently addressed by management resources. It is also extraordinarily refreshing to see “silo buster” included as an important responsibility.”

One caveat about language: the authors use the word “values” in a tactical, job-related context, not in the more global, character-related way that many use that word. It is used both as a verb “pay attention to” and noun “important contribution.”

Each level includes warning signs of someone not performing at the right level, as well as guidelines for appropriate management activities for their level. In between advice they present useful case studies to bring the examples to life. Bullets and subheadings make it easy to reference.

Passage One: From Managing Self to Managing Others

The classic shift from individual contributor to supervisor or working supervisor involves new time management skills, and greater planning. This phase calls for spending real time in assigning work to staff, motivating others, coaching for professional development and follow-up to hold people accountable. The obstacle to be overcome is maintaining the old attitude that individual contributor work is the “real work” and instead paying attention to managerial work and understanding its value. It is in fact “mission-critical to their success.” It should be noted that there is a powerful gravitational pull back to individual contributor work. The key to making this transition successful is coaching, guidance and reinforcement from upper management.

Passage Two: From Managing Others to Managing Managers

Managing managers adds yet another layer of complexity. The major shift is that generally individual contributor work diminishes even further. It calls for developing supervisors under them so they can successfully navigate the transition of Passage One, which the managers themselves may have only recently accomplished. It requires a more strategic view of the business. In other words, it’s no longer sufficient to just focus on one’s group or department. Successful managers at this level need to understand the whole enterprise.

Some outstanding technical employees whose forte and interest lie in individual work would be mismatched to be moved into managing others.

Passage Three: From Managing Managers to Functional Manager

In this case the reference is to a function such as plant management, not just a functional area such as marketing or operations. In fact it specifically refers to understanding and learning to value the contributions of others including the somewhat risky requirement of relying on other people’s information. Empathy, timing and judgment are necessary. Giving effective feedback is essential for building competence while maintaining morale.

Preparing someone for success in this transition requires participation in activities which broaden perspective, for example task forces, non-profit boards or business community forums. Networking across departments is key. Therefore managers who previously believed they only had to satisfy their manager will be at a disadvantage. Strong peer relationships pay off. This level requires being able to see interlocking dependencies and impact. The linear problem solving sufficient for lower level roles is no longer enough. Valuing what you don’t know also becomes critical.

Passage Four: From Functional Manager to Business Manager

This level of management offers managers significant autonomy. There’s also a more visible line between effort and market impact. It’s here that a long term view is rewarded. This responsibility for long term planning must be balanced with meeting present commitments. “Thinking time” is needed at this level, to reflect and analyze. “Business managers actually have to change the way they think.” The new metrics are more about how to grow, assess whether profit is sustainable, and consider how to maintain competitive advantage. Accountability increases dramatically. Functional prejudice (seeing the world from the perspective of prior expertise) is limiting and potentially damaging. Uninspired communication and inability to assemble a team are risk factors at this level – and serve as early warning signs of difficulty.

Passage Five: From Business Manager to Group Manager

This level refers to being responsible for several business units at a time, where the focus of the work, and the satisfaction, is in valuing other people’s successes. Developing strategic direction is a sign of trouble, as that should be the responsibility of the business managers. There is no direct operational responsibility here; success depends much more on managing what is not visible, or anticipating risks and opportunities which are not yet visible.

Passage Six: From Group Manager to Enterprise Manager

The focus on long term vision becomes even more important at this level, as well as tracking operating performance. Responsibilities are to multiple constituents including investors, employees and the community. In fact most management time is spent on external relationships. “Performance as a CEO will be based on three or four high-leverage decisions annually.”

Small Business Application

Small companies can benefit from the constructs of this model, even if the formulation of divisions and business units is different. If the business remains very small, then more complex levels of management development are not really required. However if more people, locations or product lines are added, it will require delegating effectively to others, and possibly to manager of managers. The ability to give up hands-on involvement ties closely to success.