1: Selecting the right people and putting them in the right roles is just the beginning of the CEO’s role in managing talent.
The best CEOs, write McKinsey consultants Carolyn Dewar, Scott Keller, and Vikram Malhotra in their book CEO Excellence, make a considerable investment of time and energy “into coaching, retaining talent, managing performance, and planning for succession for the most valuable roles.”
These leaders become personally involved in succession planning for key roles.
“Just as a baseball or soccer club has a ‘farm’ system (teams of younger players that act as feeders into a major league team),” the authors write, “the CEO should have a handle on who the up-and-coming stars are and where and when they get the nod to move up a level.”
They work closely with their HR or People departments to create a well-defined, data-driven approach which results in a strong bench.
“For every job, mine included,” says DBS CEO Piyush Gupta, “we work through what is the slate, who could do the job, who could do the job in three or five years? We then case manage 100-odd people. Who needs to move, what should we move them into, how do we get them the exposure and growth they need to get from point A to point B? It’s very well structured.”
Dupont CEO Ed Breen shares, “We have a system for identifying the promising talent coming up in key roles. I do a mid-year and year-end review of our top talent. . . We put people into four buckets, and if the ones in the bottom bucket are still there six months later when we do the review, we start to ask, ‘Well, why didn’t we do something about it?’
“We have a fairly regimented system that way,” he explains. “I’m just a big believer in having the best team on the field to win.”
2: The best CEOs embrace their role as coaches. “Thirty percent of my time was coaching and growing our talent in one-on-ones and town hall meetings, and having chats with managers important to the business who aren’t my direct reports,” says Brad Smith, former Intuit CEO and current President of Marshall University.
Another effective tactic? Involve board members in the mentoring process as well, states Galderma’s Flemming Ørnskov. As CEO, his job is to identify a good match of skill sets and personalities.
“The whole philosophy,” says GE CEO Larry Culp, “is getting the right people in the right place and coaching them to be great in those roles. It’s just a huge part of being a successful CEO.”
“Coaching or mentoring provides these talented individuals,” Carolyn, Scott, and Vik write,” with the opportunity to truly shape the company and drive impact, to foster a sense of ownership in seeing those projects succeed, and to feel pride in the meaningful contribution they’ve made.”
3: By having a rigorous and disciplined approach to talent management, the best CEOs avoid what is often cited by less effective leaders as their biggest regret: Not moving fast enough on low performers in critical roles, even when it was clear a change was necessary.
“By clearly defining the talent requirements for the most important value-creating, protecting, and enabling roles (matching them with people with the right skills and attributes), and by building a deep bench of leaders, the politics that otherwise surround personnel issues largely disappear,” the authors note.
JPMC’s Jamie Dimon states: “When someone asks me how I can demote a wonderful person, a loyal, ‘pillar of society’ out of a role where they aren’t the best fit, the answer is simple. They’re no longer doing a good job. If we were ‘loyal’ to them by leaving them in the job, we’d be hugely disloyal to everyone else and to the company’s clients. That, right there, is the hardest part about talent management.”
More tomorrow.
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Reflection: How rigorous and disciplined is my organization’s approach to talent management? As a leader, how much time am I spending coaching and mentoring high potentials?
Action: Journal about my answers to the questions above.
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