For years now, the effectiveness of leadership development programs has been called in to question. In the US alone, over $10bn a year is spent on leadership development and roughly two thirds of executives rank leadership development as one of their key priorities. Despite the amount of money spent on leadership development and the importance attached to it, only 7% felt that leadership development was effective. In fact, according to the centre for creative leadership 38% of CEOs fail in their first 18 month.

Stop promoting the wrong people

A key reason for this failure, is that companies are promoting people into management roles, without them demonstrating any leadership capabilities. Gallup research has proven that 9 out of 10 first time managers do not have any leadership skills. Companies all around the world are guilty of promoting someone based on their ability to do their current job, not the next job. Do you know what the top salesperson in a company is good at? Making sales. Do you know what the best software developer is good at? Developing software. Despite this glaringly obvious fact, companies who rightfully want to reward these individuals, decide they will let these people manage others as a reward, despite having no skills to do so.

Identify your leaders early

What these companies and their HR departments should be doing, is identifying which employees have leadership skills early on in their tenure with the company. A company’s next generation of leaders are likely to be those who are average performers in their current roles. Because if you have a natural pre-disposition to leadership, you do not always make an outstanding performer in a more junior role. Ironically, the junior or mid-level employees who are seen as being difficult, are those who would make the best leaders. Instead of just doing the work, they are questioning why the work must be done this way. They are challenging the status quo and established thinking and creating new ways of doing things, or at least trying to do so. This is what you want from your leadership group.

A company does not need to have a robust team of experts internally able to assess which employees have leadership characteristics either, any of the major psychometric tools will be able to show you which employees have a greater proportion of leadership traits. A company could have every employee who joins the company take one of these tests and know who their next group of potential leaders should be.

Leadership should be a separate career path

A leader does not have to be an expert in doing, but they must be an expert in leading. Let us use sports as an example. The best sports coaches in the world, were very rarely top sportsman in their respective fields themselves. There are a few who were decent, but very few were truly world class superstars. Businesses should follow this approach and treat leadership as a separate career path and skill set. A good manager or leader will be able to improve the performance of any team whether or not they are an expert in the area themselves. So, there should be a pool of resource within the company that are grouped together, not by their business unit or individual team, but as leaders and potential leaders.

Plan for the long term

Finally, there needs to be a long-term focus on this group of leadership talent. This should consist of a sustained focus on leadership development to cultivate the strong base of leadership traits this group already has and tweak them to embody the desired values of the organisation and the culture it is trying to cultivate. Far too many firms waste significant resources on individuals that at best, may become average leaders after several years of development. A focus on those who will deliver the best ROI for the organisation should be key. This should be combined with succession planning. When an existing leader leaves or gets promoted, the replacement should automatically come from this internal group. Taking this approach, should naturally lead to a much stronger leadership group within a 3-5-year window.