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Article: Friday, 26 June 2020

Jazz quartets and horse coaching are among the more outlandish approaches to leadership development. They may seem whacky, but these methods highlight how much of a growth sector leadership development is. With US$366 billion being spent in this market annually around the world, organisations are rightly looking for tangible and lasting results when leaders are back in the office.

The problem is, however, that there’s often little or no empirical evidence to suggest that the programmes actually work. In fact, a study from consultants at McKinsey & Company found that most leadership programmes fail to achieve their aims. There is a booming leadership industry out there, but it’s often based on hunches. People invest tonnes of money, but if we are not careful, leadership development will be more of a feel good industry. We need to get more serious.

Indeed, the current Covid-19 fallout underscores the need for good leadership as the world becomes more complex and the economic crisis deepens. But leadership programmes are largely failing to meet this need. Leaders are not born: they are made. However, leadership development, in many cases, gets sucked into the self-help realm. Or it’s a nice perk employees have. Training and development is tax deductible, so a company will send you to a nice hotel with nice wine. These trips are often more about the context and the fluff around the training than the development itself. There is an air of escapology to it, where you reinforce the ideas people already had rather than guiding them through experimentation, so as to gain new perspectives.

"RSM has sought to develop a leadership programme that is evidence-based and delivers tangible results."

Tangible results

RSM has sought to develop a leadership programme that is evidence-based and delivers tangible results. We want to really move the needle: to make people objectively better based on set criteria. There are so many leadership programmes that will not have that accountability.

In order to become more evidence-based, the leadership development industry needs development centres to assess the baseline capabilities of leaders and how they evolve over time. Evidence suggests that using this as a starting point for leadership development, via action-oriented learning with further assessment at the end, makes for the most effective programmes. While RSM is striving to live up to these high standards, it has a long way to go.

Leadership development is a big market opportunity, but there are competitive threats from new training providers and large organisations taking training in house. There is a growth in the number and variety of corporate training providers and consultants offering leadership development courses.

However, RSM is accredited, which encourages more rigorous measurement of learning outcomes. For instance, the institution is one of just 1% of business schools worldwide to have achieved “triple crown” accreditation from three international awarding bodies.

We should be able to demonstrate that something has changed by making an assessment at the beginning and end of a programme. This goes far beyond industry-standard “smile sheets” that gauge participant sentiment at a basic level. Calls for data to measure leadership development are growing louder as the market expands and companies look to judge whether leaders have an impact at work, just like they analyse a profit and loss statement.

For example, RSM’s MBA students are put through their paces at the start of their programmes in a training exercise with the Dutch Marines. Participants complete team-orientated tasks, such as moving a broken-down amphibious vehicle, and are assessed on how well they cope with stress and uncertainty.

Leadership compass

RSM uses a “leadership compass” based on a century of research into the competencies that are proven to make for effective leaders. 

1. WHAT?

Being able to set realistic goals and maintain motivation (tasks, or the “what”)

2. WHY?

Managing complexity well and being open to change (change, or the “why”)

3. HOW?

Understanding impact on people (ethics, or the “how”)

4. WHO?

Being able to connect well with others (relations, or the “who”)

The competencies manifest in behaviour, such as a passion and ambition that inspire others, fairness and empathy.

The framework lends itself to producing responsible business leaders who care about a purpose as well as profit. Effective leadership means being a force for positive change. It’s not about creating the next Nelson Mandela or Gandhi; you can have a positive impact in whatever your role is.

This reflects RSM’s vision to become a force for positive change in the world. The school recognises that it has a responsibility to produce leaders who consider more than profit maximisation; they care about their impact on society and the environment too. This is reflected in students’ consultancy projects with non-profit organisations that are trying to change the world for the better. They cannot afford the talent that MBA students would otherwise bring to a big corporation.

The projects highlight key changes in leadership development, including action-based learning that tries to get executives out of their comfort zone. Meanwhile, there is an increasing use of practitioners who might have more experience in the boardroom than a classroom.

There is a debate about the benefit of this approach compared with using independent academics whose instruction is rooted in peer-reviewed research that is published not just in prestigious journals but can have an impact on the business world too. RSM sees a value in blending the relative merits of industry expertise with academic rigour, having appointed faculty members who combine both.

"We believe that RSM has a unique opportunity to help shape the views and approaches of future leaders before their habits are entrenched and harder to change."

The value of feedback

Teaching ability is crucial in assessing the outcomes of a training programme. Giving and receiving feedback is an essential part of learning how to work with people and helps in creating alignment between seemingly disparate teams. This is vital for rallying an organisation behind a common purpose too.

In our programmes, leaders receive 360-degree feedback from faculty members and peers, including advice on what they think a person should “stop, start and continue” doing. This encourages participants to become more self-aware and handle difficult conversations at work. Feedback will help people to grow; it is essential for a leader to be able to take criticism well and to be able to change their behaviour. The process of measurement creates better leaders.

The approach underscores the importance of “soft skills” in leadership development, such as communication, collaboration and relationship building, alongside hard technical abilities like number crunching. But while these “touchy feely” courses can build up participants’ resilience, they can lead to conflict too. We therefore stress the importance of creating a safe environment that encourages constructive feedback, which can take the sting out of the tail.

One way to do this would be to set up an alumni mentoring programme, especially for younger students. Graduates would give back to the school, making a positive impact, while everyone involved would gain practice in giving or receiving feedback on the students’ intended career goals. It could be a win-win.  

We believe that RSM has a unique opportunity to help shape the views and approaches of future leaders before their habits are entrenched and harder to change. Our students are here for three or four years when they do their bachelor’s degree. It’s a fantastic opportunity to guide their development while they are still young and prepare them to become the next generation of leaders.  

Engaging alumni, meanwhile, is important to encourage their lifelong learning. With the pace of change in business now so rapid, with people changing careers more often, living longer lives and retiring later, it seems unlikely that one or even two degree qualifications will suffice. We see the business school, potentially, as being a hub for up-to-date leadership development that alumni can call on throughout their entire career, not just at the start. This could help the school with its revenue too, guaranteeing customer loyalty.

Alumni could, for instance, go back to school at various points in their lives to top up their skills and knowledge, through an action-oriented, evidence-based leadership development programme.

Dr. Hannes Leroy

Associate Professor

Rotterdam School of Management (RSM)

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Dr. Lotte Glaser

Assistant Professor Strategy & Entrepreneurship

Erasmus Centre for Entrepreneurship (ECE)

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