Leadership Pipeline (Charan and Drotter)

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Building, developing and maintaining a pipeline of skilled, prepared leaders from within the company. Explanation of the Leadership Pipeline of Stephen Drotter, James Noel and Ram Charan. (2001)

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What is the Leadership Pipeline? Description

Sometimes hiring an executive from the outside can be the only available short term option. However Drotter, Noel and Charan argue that for the long term, management should build, develop and maintain a pipeline of skilled, prepared leaders from within the firm. Their Leadership Pipeline model helps to create such a funnel of future management talent by explaining what changes in time application, skills and work values are essential for making the transition from one leadership stage to the next. Also their model helps to understand the different demands of various management levels.

Origin of the Leadership Pipeline. History

The Leadership Pipeline idea was based on work originally done at General Electric in the 1970s by Walt Mahler, a HR consultant and teacher. Mahler set out to identify all the changes that were required to be successful at different leadership levels. He concluded that the most important change involved work values: what one believes is important in the new job. Mahler also developed the Crossroads Model, suggesting that there were specific leadership crossroads in every organization, each with its own specific requirements. Drotter was a student and later a friend of Mahler and refined and adjusted the crossroads model into the leadership pipeline model. Executive Development and Coaching Consultant James Noel and Top-level Succession Planning Consultant and Professor Ram Charan also contributed later.

6 Passages in the Leadership Pipeline. Stages

From Managing Self to Managing Others. People enter this stage when they demonstrate they are skilled individual contributors and they have the ability to collaborate with others.
- Change in Time Application: These people must learn how to reallocate their time so that not only their own assigned work is completed, but also they help others perform effectively.
- Change of Skills: Shift from doing work to getting work done through others.
- Change of Work Values: From valuing their individual work to valuing managerial work.
From Managing Others to Managing Managers.
- Change in Time Application: In this phase, managers must only manage. They need to divest themselves of individual tasks.
- Change of Skills: The key skills they must master during this transition include selecting people to turn passage 1, assigning managerial and leadership work to them, measuring their progress as managers, and Coaching them.
- Change of Work Values: Learn to hold first-line managers accountable for managerial work rather than technical work.
From Managing Managers to Functional Manager.
- Change in Time Application: Participating in business-team meetings and working with other functional managers. Creating a functional strategy that enables them to do something better than the competition. Develop a sustainable Competitive Advantage within their function.
- Change of Skills: Develop new Communication Skills and being able to manage some areas that are unfamiliar. Learn to consider other functional needs and concerns. Teamwork with other functional managers and compete for resources based on business needs.
- Change of Work Values: Adopt a broad, long-term perspective.
From Functional Manager to Business Manager.
- Change in Time Application: Allocating time to think is a major requirement at this level: Managers need to stop doing something every second of the day and reserve time to reflect and analyze.
- Change of Skills: Business managers are responsible for the bottom line. Rather than consider the feasibility of an activity, a business manager must examine it from a short- and long-term profit perspective.
- Change of Work Values: Value the success of their own business.
From Business Manager to Group Manager.
- Change in Time Application: From running their own business to succeeding indirectly by managing and developing several businesses and business managers.
- Change of Skills: Be able to:
  - Evaluate strategy in order to allocate and deploy capital.
  - Develop business managers.
  - Develop and implement a Portfolio Strategy.
  - Assess whether businesses have the right core capabilities to win.
- Change of Work Values: Derive satisfaction from the success of other people’s businesses. Appreciate managing a portfolio of business.
From Group Manager to Enterprise Manager.
- Change in Time Application: Set direction and develop operating mechanisms to know and drive quarter-by-quarter performance that is in tune with longer term strategy. A subtle shift from strategic to visionary thinking, and from an operating to a global perspective. Let go of the pieces, and focus on the Whole. Assemble a team of high-achieving, ambitious direct reports, knowing that some of them want his job.
- Change of Skills: Ability to manage a long list of external constituencies proactively.
- Change of Work Values: Learn to value Trade-offs. Appreciate managing one entity.

Strengths of the Leadership Pipeline. Benefits

Helps to understand that management and leadership roles are not the same on all levels of an organization, because of many differences in optimal time application, skills and work values.
Dynamic model. Facilitates individual performance improvement, Coaching, Mentoring, training and experience assessments and planning.
Facilitates succession planning, leadership development. Helps to identify and prevent potential pipeline failures.
Improves selection processes.
Facilitates more objective promotion decisions.
Helps HR to focus on specific skills, time application and work values, rather than rely on generalized training and development programs.
Diagnostic tool to identify and remedy mismatches between individuals’ capabilities and their leadership level.
Timing. The pipeline provides a system for identifying when someone is ready to move to the next leadership level.
Efficiency. Little or no time is wasted on jobs that merely duplicate skills.

Limitations of the Leadership Pipeline. Disadvantages

Aimed at large organizations. Can however be used in medium-sized businesses as well, by removing the group management level and understanding that the business manager is also doing the work of the enterprise manager.
It takes a long time and sustained commitment to implement the framework.
As with any model, try to avoid a too mechanical implementation of the concept. Think holistically and with complexity of people and organizations in mind.

Book: Ram Charan, Stephen Drotter and James Noel - The Leadership Pipeline - How to Build the Leadership-powered Company -

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Recent User Comments

    			 
  			   Ajantha - Sri Lanka
  	       
  		     Potential Assessment
  	  		 "For an employee to move from one passage to another, both, performance and potential needs to be sceintifically evaluated. Any tips on evaluating the Potential ?"
  			   
    	  		 2

    			 
              - Africa
  	       
  		     Implementing the Pipeline
  	  		 "In implementing a Leadership Pipeline I found that line management is very slow in taking up the challenge.  Is that common or am I imagining it?"
  			   
    	  		 2

    			 
  			   Lieven - Belgium
  	       
  		     Monolytical model
  	  		 "A disadvantage of this model whilst using it in front of employees is that it accentuates vertical growth of an individual as the only careerpath. Careerpaths can be, on the one hand, more complex and less linear upwards (eg doing various jobs). On the other hand the model is less clear about career tracks of experts (eg academical world) or program leaders (eg IT) which follow similar steps in parallel with this model without ending as executives. Within the view of talent scarcity, these parallel tracks can be as valuable for a company as moving to the executive level.  Translating these tracks into a coherent compensation and benefit practice is an interesting challenge."
  			   
    	  		 -7

    			 
  			   HR Manager - USA
  	       
  		     Creating Talent Factories
  	  		 "In an article "Make Your Company a Talent Factory" (HBR June 2007), Douglas A. Ready and Jay A. Conger make some useful complementory suggestions about HOW you can create strong leadership pipelines, by combining 'Functionality' and 'Vitality' into effective Talent Factories. FUNCTIONALITY means establishing rigorous talent processes that support strategic and cultural objectives. VITALITY requires an emotional commitment, engagement and accountability in the 1. Top Executive Team, 2. HR/Talent Staff, 3. Line Management and 4. Talent Pool itself. According to Ready and Conger, talent functionality / processes are easier to copy by competitors then talent vitality / passion..."
  			   
    	  		 8

    			 
  			   chavan - india
  	       
  		     HRD
  	  		 "it will be worth while implementing this process in real life situation.
PLC"
  			   
    	  		 1

Best User Comments

    			   
    			     Giacomo - Italia
  	         
  				   CEO succession inside/outside
  				   "According to a recent BAH study of the top 2.500 companies by market capitalization on CEO Succession, one consistent announcement effect (North America, Europe and Japan) is that selection of an outsider CEO produces a big downtick in stock price, while selecting an insider triggers an uptick. BAH believe this probably reflects investors' assumptions that the outsider is taking over a poorly performing firm, or that the insider will generally produce better returns for investors (Source: S+B, Issue 47, Summer 2007, p. 48)"
    			   
        	  		 -5

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12manage for:

● Kerrie (Namibia)	Matrix	"I have implemented this model within a large manufacturing plant - using psychometric assessments for determining learning potential and combining it with employees' Performance Management profile, together with other demographic data into a Matrix. This matrix is an excellent practical tool for leadership to understand their talent pool across the organisation and to identify high-risk areas. I am presently conducting a longitudinal research, over a period of three years, on the validity of this model - learning potential is used as the constant and performance ratings over three years are the moderating variables. I would like to discuss this research with other social scientists."
● Ajantha (Sri Lanka)	Learning Potential	"Sounds interesting. What type of specific psychometric assessments are used? Who generally administers the questionnaire?"
● Sundara Rajan (India)	Learning Potential: TST Test	"There is a tool called "Test for Selection and Training - TST" which measures the "Trainability" or "Learning Potential" of a working age employee fairly closely. This "Learning Potential" combined with the behavioral fit with the job ahead and emotional intelligence of the person, gives a strong basis for investing further in the development of a person."
● Gareth (South Africa)	Comment on Matrix	"Other moderating variables may include the nature of role and whether the subject has remained in the same role. Also, any self awareness processes, leadership development initiatives, skills development etc. can impact on the longitudinal research. My need is to find out if there is an instrument which measures pipeline constructs?"

● (South Africa)	Implementing	"Are you linking / integrating the objectives of the Leadership Pipeline with your performance measurement and remuneration systems?"
● Herman (South Africa)	Implementing the Leadership Pipeline	"The intention is to use the Leadership Pipeline evaluation for performance measurement. The whole system was developed for this. I just don't know if line-managers will ever get past the intellectual acceptance of the system and start using it for what it was designed for. This is my biggest challenge in implementing the system. Lastly, we do not use it with the remuneration system at all. I did not even know that it can be done."
● (South Africa)	Implementing	"First let me answer your original question. Implementing a new process, discipline, etc. is always a challenge. It takes persistence and effort over a long time. People do not easily change their habits even when there are seemingly great advantages to be gained from it, so the situation that you are facing is normal. You are now in the area of Change Mangement. This forum and media is not optimal to discuss all the methods you could use to successfully manage and implement the Leadership Pipeline so I will revert to your own e-mail address to give some ideas of how you can accomplish this task."