Chapter 6
New Rules for Building a Leadership Team
A few years ago, we were working with a client who was running a large call center in Charlotte, North Carolina. At that center was a manager named Leon. When we first started working with this client, Leon was the manager of a day shift. His employees regarded him highly, and his team performed exceedingly well on all measures. Then something changed for him—there’s that old, reliable change coming back again. Leon decided that he wanted to go back to school to get a degree, and the only way to do that would be to switch to an evening shift so he would have enough time during the day to attend his classes.
Now, completely switching a work schedule is a big, often uncomfortable change for most people, to say nothing of switching teams. Not many people would volunteer to make such a dramatic change. But when Leon announced his decision to move to an evening shift, nine of his fifteen team members went with him. That’s nine people who valued Leon’s spectacular leadership to the point where they were willing to literally turn their working lives upside down just to stay with him.
Obviously, Leon scored quite highly on the Leader Engagement Index. He is the perfect example of how responsibility and accountability for retaining talent needs to move out from the HR department and into the front lines. As we have discussed, competitive pay, benefits, and team-building programs, while helpful, are no longer enough to keep workers from shopping for their next opportunity. Leaders like Leon are an organization’s best defense against unwanted turnover and keeping valued talent longer.
But how prepared are leaders to perform this critical role? Getting leaders to accept accountability and learn new retention and engagement skills may first take some unlearning. Those fundamental assumptions about the availability and skill of the workforce may get in the way. A couple of assumptions are that you need to hire only the highest quality people, and you need to ensure that you always put the right people in the right jobs. But what should a leader do when there aren’t enough “highest-quality” people with all of the right skills to go around?
Many terrific leadership formulas discuss charisma, focus, passion, and courage—and thousands more cover good, solid management skills—but what if you’re losing 50 percent or more of your employees a year, like some organizations already are? Will the same success formula still apply? Are the skills the same?
In a word, no. Another client of ours—a large national sales organization—discovered this fact the hard way. Their practice for promoting leaders at the time was decidedly twentieth century. Leaders received promotions and rewards only if they met their sales goals. It did not matter if they “churned and burned” their teams—or worked them so hard that they lost a large portion of their staff to burnout or better opportunities elsewhere. This meant that they were promoting people who could make sales but had virtually no engagement and retention skills. The result? This client suffered from poor customer satisfaction scores. In fact, they were the worst among the top four competitors in their industry. For them, something needed to change, and it needed to change quickly.
But where could they turn? Leadership is a complex subject—so complex, in fact, that if you visit the Barnes & Noble website and search for books on the subject of management and leadership, you will find over fifty thousand titles. The trouble is that the focus of most leadership training largely has been on the skills traditionally associated with leadership, and the values and attributes a leader brings to the job. With this chapter, we present an ambitious premise: It’s time to change the mindset of what we look for in a leader. To this point, we have demonstrated that engaged and energized employees that stay and grow with an organization are the key to success. Now we turn our focus to leaders, the people who are the head and the heart of the strategy to engage and retain talent.
The Fish Rots …
In Chapter 5, we discussed how performance was a foundational component of the Career Growth and Accountability Model. The same applies to leadership, although now the significance gets amplified, given the role a leader plays. With our focus on leaders, the thoughtful capability to actively cultivate engagement with one’s team members, plus having the knowledge and skills to create workplace conditions that promote retention, become nonnegotiable core competencies for today’s leaders. This know-how is essential to every leader’s ability to succeed. It is a vital part of team performance, organizational profitability, and long-term success.
The leadership team always—always—sets the tone and the culture of the organization. We will get deeper into the culture component in the next chapter. For now, what we need to keep in mind is that, as our colleague Dr. Richard Vosburgh quoted, “A fish rots from the head down.” That’s an ancient proverb, but it could not be more relevant in twenty-first-century organizational practice. What it means is that the quality of everything we do starts with leaders. In your organization, the “head,” your leaders, are the ones who set the tone and culture for their teams. If you don’t get your leadership team aligned with the culture you want to promote, then changing that culture and improving engagement is impossible.
Leaders have to fully embrace engagement as a core competency of their jobs. They have to define it in every way possible. This core competency must permeate how leaders carry themselves and conduct their own business with their own teams. Your organization must emphasize engagement skills when promoting leaders into leadership roles and growing them into more and more senior roles.
Leadership sets the tone through their actions and interactions every day. They set the culture for their teams, their partnerships, and their organizations overall. For example, we recently worked on retention with the North American arm of a major European luxury auto manufacturer. On this continent, they have over two hundred car dealerships that are largely run by auto groups that include multiple dealerships and brands under their umbrellas. For those more complex entities, it isn’t usually difficult to champion the luxury and exclusivity the brand hopes to promote as part of its mission. However, a significant number of single proprietorships were struggling.
When you charge a premium price for your product, you expect your people to deliver premium service. When that doesn’t happen, you have a problem connecting with the customer and keeping them in the fold. So this automaker redoubled its efforts to make exceptional service a part of their culture. When you get a call from one of their technicians or dealerships, the person on the line will ask you, “Is there any reason you wouldn’t rate our service as a ten out of ten?” If there is, then the caller will ask if the customer has any advice on how they can correct the problem so they will always rate ten out of ten in the future.
This measure has helped tremendously, but around the time TalentKeepers got involved, the company was still struggling with certain dealerships that weren’t living up to the high standard. Upon conducting our surveys, we found that a common characteristic among these dealers was that they were run by a family member—typically a son or daughter of a founding owner—who frankly had no business running a dealership. This often led to disarray from the top down. One center in a southern American city had gone through five general managers in just two years. The general perspective of the senior leadership teams at these kinds of dealerships was, “Well, if that leader’s not happy, we’ll just get another one.” In every instance of these poorer performers, turnover was extremely high, service was rated low, and sales were comparatively poor. The best people at these locations were always quick to flee the environment. This left the dealerships with little choice, they had to rely on people they otherwise probably would not employ.
The Mission Statement
We have already mentioned the old adage that people don’t leave companies; they leave bosses. The full picture of why a talented employee leaves for other employment is obviously much more robust than that. For starters, we can add the wisdom of Bruce Belfiore, our colleague from BenchmarkPortal. According to Bruce, the full picture starts with, “Employees don’t bond with corporations; they bond with their bosses and colleagues.” Sure, a person can believe in a corporate mission, can be proud to work for their company, and can enjoy the benefits of their work, but they don’t form their bond with the faceless corporate entity; they form their bond with their boss and coworkers. Either that, or their boss and coworkers break any potential bond before it has a chance to form.
What this means is that the leader can’t only be great at the role her team is responsible for completing. Among many other skills that we will highlight in this chapter, a qualified leader has to buy into and promote the company message. If bonding with the boss is the closest any employee gets to bonding with the company itself, then the boss has to embody the corporate mission. “A good leader needs to know what the corporate mission is,” Bruce said, “and especially how it relates to their department and employee interaction. If you leverage this well, you get better results across the board.”
Bruce wasn’t talking only about retention. He was talking about productivity, efficiency, engagement, and pretty much any other business result a company can track. To illustrate his point, he told us the story of a woman who attended one of his classes five years ago. Bruce was in front of the class, discussing the critical importance of embracing and living the corporate mission as a leader, and he could see this attendee nodding as she rapidly scribbled her notes. “At the end of the class,” he said, “she thanked me and told me that the next time I visited her operation, I would see the message in action.” During that next visit, the first thing Bruce saw on the wall was the mission statement. It was positioned where it would ensure that it was the first thing that all the agents who worked in this call center would see whenever they walked through the front door for work.
“I see you took the mission statement message to heart,” Bruce said, pointing to the sign.
“You were so right about that in the training class,” the woman said. “Ever since we started focusing on the mission, we’ve had better cohesion than I could have imagined. Now we start off every meeting by referring to the mission. It has really brought our teams together.”
This might seem like a simple measure at first—and in many ways, it is—but the simplest measures are often the most effective. The corporate mission statement is something that far too many leaders ignore, especially when it’s a situation where every leader can find a unifying principle for everything they communicate to their teams. Leaders, and particularly direct report leaders, can and will find this tool especially useful.
Promote for More Than Just Job Skill
Frontline employee turnover is often driven by leadership turnover. We have seen that in every environment in which we have worked. It all starts from the top, no matter what you’re talking about. In that last sentence, you can replace the word turnover with engagement, and it’s every bit as true. If you have high leader engagement, you can almost guarantee that you will have high frontline employee engagement. The impact of both realities is easy to see, because it relates to just about every measure of performance you can assess.
If you want high-performing teams that stick together longer and create more meaningful and positive change for your organization, then the leadership team has to embody the message. And just like that call center manager we mentioned in the introduction of this chapter, they have to be overt about it. They have to reward leaders who demonstrate not just the ability to get their jobs done at a high level, but the ability to retain and engage their staff. Further, the best organizations have to be willing to part ways with those leaders who don’t have that key ability. Keeping the people who deliver the numbers but don’t energize their staff is the surest way to underperform over the long term. Driving performance numbers by leaving bruises on your people through fear of negative consequences is not a sustainable strategy. Team members working in these environments will burn out or simply quit after too many verbal beatings.
In an environment committed to energizing employees, we need to select leaders who have a core belief that the best work gets done by inspiring people and lifting them up instead of hammering on them to work ever harder. When looking internally to fill an open leadership role, organizations must interview and evaluate candidates based on how they believe in and support engagement and retention as fundamental requirements of a leader’s role. Interviewing internal candidates allows you to base your decision on their track records of energizing employees, too. Do people enjoy working with or for this person? Does this person lift the level of excitement and performance of those people around them? Do people jump at the opportunity to join this person on an assignment, like so many did for Leon?
If you’re hoping to hire people from outside your organization, the picture is a little different. You have to ask about their record with engagement during the interview process. Make retention a standard criterion that you probe in depth during the interview and selection process. Build in questions that ask the candidates how they inspire engagement, how they build commitment among their employees, what they do to keep people, and how they make their teams more excited about coming in to work.
Fortunately, other tools help assess a candidate’s retention skills as well. We will introduce some specific tools in Chapter 8, but later in this chapter, we will discuss how utilizing these assessments can help leaders and prospective leaders identify where their engagement strengths and weaknesses are while also showing them how to improve. Utilizing the assessment allows the organization to develop leaders for the most important skills, thereby building engagement and retention into their leadership development curriculum. An added benefit is improvement in succession planning.
With quantifiable and standardized engagement and retention data at hand, you can compare leader effectiveness and use that data as a key element in identification of potential successors for your best leaders, leaders in key roles, or for areas of your business that need significant improvement. Rather than asking those leaders to engage in the sometimes uncomfortable process of training their eventual replacements, you can identify those potential future leaders through their engagement and retention scores.
Now don’t mistake us here. We aren’t suggesting that this data should be kept secret. Many organizations make this assessment a secretive process, meaning that a select group of executives get into a room and decide who they’re going to target for these positions. But the best organizations are more open about the subject and tell leaders that they need to have someone who’s ready to be promoted into their position before they themselves can earn a promotion. Contrary to hurting motivation, this open and honest picture of how to continue on the path up the leadership hierarchy tends to fuel a leader’s desire to train someone else to take on his role.
When selecting new leaders to serve your organization, the overarching goal is to avoid the common tendency to select or promote someone (whether internally or from another talent pool) based solely on the performance results they’re currently delivering rather than a more comprehensive criteria. Include performance results as well as talent engagement and retention results. Many prospective leaders are perfectly capable of delivering business results, but they alienate and demoralize their employees. In other words, these leaders drive performance and deliver short-term results but lose a lot of talent along the way. Organizations often make the mistake of promoting these people based on their results while ignoring the impact they have had on employee turnover. This almost always works out badly for the organization in the short term, but it also can have longer-term impact when these same people continue to deliver great numbers at the expense of their staff and get promoted again and again. The higher the level this kind of leader occupies, the greater the damage they can have on an organization.
Accountability Is Priority 1
“It’s not enough to just talk about the importance of engagement,” says Steve Urquhart from the Orange County Clerk of Courts in Orlando, Florida. “Nor is it enough to make general statements about our commitment to engagement and retention. Managers have to make it a focus and a part of how they lead. They have to model the behaviors, follow through, and coach the expected performance from their direct reports.”
According to Steve, one of the biggest challenges—particularly at the leadership level—is the sense that a leader can manage by decree. In other words, you can make a broad statement about your organization’s commitment to a cause and expect everyone to buy in. Some leaders will even write an article in the newsletter and believe that’s enough to have everyone modeling the desired outcomes. Whether it’s the result of a younger work staff of millennials or a general changing of the times, employees lately are more skeptical about these kinds of measures and are less likely to follow blindly from the bottom up in organizations of all kinds.
For these reasons, none of the measures we have discussed to this point will take your organization where it needs to go without having the leaders actively lead the agenda. Leaders can’t simply give lip service; employees won’t become engaged and will instead keep doing what they’ve been doing until somebody directly works with them to change. Or worse, employees may become cynical and less engaged with what they perceive as gratuitous support and no action.
“Sometimes senior management overestimates the weight of their proclamations,” Steve explained. “Certain messages need to be heard multiple times. Sometimes as an executive, right around the time you’re tired of hearing your speech, that’s when it starts to sink in.”
When it comes specifically to promoting and developing new leaders who are focused on engagement and retention, Steve points out that everybody thinks they want to be promoted, but few people know what’s in store for them when they take on a leadership role. “We wanted to provide assessment tools that could provide resources to help that employee engage their readiness and proactively work on some areas that would become a challenge,” he said. “Individuals succeed based on their skill set. A manager succeeds based on getting their people to do what needs to be done. That’s a tough transition for some people.” For this reason, the best organizations take the opportunity to provide some self-development and preparation so prospective leaders aren’t walking blindly into a leadership role that might not be a good fit for them. Just as important, the leaders who take charge of these initiatives always hold themselves accountable to provide the necessary training.
You know what’s most interesting? Leaders are often surprised to learn that they can make any kind of impact, let alone such a significant one, if they show accountability. “Employees can see and feel senior management’s support for them,” Bruce Belfiore explained. “And it extends not just through a single team, but across teams and throughout the organization.” The trick is that leaders need to take the lead on this matter. They need to make sure their employees feel as if they have a place at the table when it comes to voicing their opinions on matters that they believe will improve their teams, their leadership, and the organization as a whole.
The best practice here is to task your leaders with making sure that proper communication is funneling from one part of your organization to other parts where they can do the most good and be leveraged for the most success. This means leaders getting together to talk about how they can invite people from each other’s teams to see other parts of the organization that their daily work does not touch, and meeting people they don’t often get a chance to meet. Not only does this instill a better sense of how each employee is a part of the bigger organization, rather than just their own small piece of it, but it also helps leaders and those they lead to see different strategies for energizing and engaging staff as well.
Measuring “Will Do” and “Can Do”
So we know why selecting for engagement and retention competencies is important. We also know that training new leaders on how to lead is key. But how can you shed light on organization-wide data to determine how leaders are performing and how they might learn better engagement strategies from other teams? Many of the employers we work with have found a 360-degree survey format is useful to solicit input from individual leaders themselves, their direct reports, their managers, and often their peers. The objective here is to enhance a leader’s awareness of their strengths and weaknesses so that the organization can determine and prioritize the most appropriate developmental activities for that leader. Additionally, this kind of survey can be used as pretraining and posttraining diagnostic tools, and as part of a leadership assessment program for development and promotion.
The content of a survey like this should focus on leadership competencies related to effective employee engagement behavior in both the broad sense, like building trust, as well as being easily customizable to capture organizationally specific content. The results should still retain internal and external benchmarking comparisons that are easy to implement and provide detailed, actionable results to all levels of management, from executive summaries to an individual report for each leader.
Such surveys can make valuable comparisons in those areas where the leader and the other respondents differ in their perceptions. The best way to do this is to keep the survey itself anonymous to ensure that responses are the most transparent possible. When completed, organizations should make the survey available at individual and aggregate levels.
Results often illustrate how a leader perceives him- or herself relative to the perceptions of employees, peers, and managers, guiding the prioritizing of a participant’s development plan. As a leader, if you’re the agent that promotes this concept, you’re seen as a person who is making the team a part of the bigger enterprise. Your team will appreciate you for that, and will see you as someone who not only cares about improving yourself and your employees, but about breaking the team out of the shell and connecting to the organization as a whole.
For senior leaders, the data from this kind of survey can be invaluable, because it enhances your perception of who is and is not ready for promotion either into a leadership role or into a higher level in the organization. This allows you to set up better programs for hiring and training toward better engagement and retention behaviors, and identifying new people for leadership roles. That training is a critical piece of the puzzle as well. “You have to give training that prepares people for their roles as leaders as they advance through the ranks,” Bruce Belfiore suggested. “This doesn’t often happen. Too often, people are promoted because they’re good at what they’re doing, but they aren’t given training to be a great leader of others.”
Another type of assessment is often used to determine promotable readiness for a leadership role. It allows organizations to identify whether their leaders and/or prospective leaders can discern the difference between effective and ineffective leadership behaviors that foster employee commitment and motivation. If the leader or prospective leader can discern that difference, then she will be more likely to succeed in the role. If not, then she probably will not be the best at engaging and retaining talent. This is why measuring where a leader is with her understanding of these principles can take an organization a long way toward ensuring that the best people ascend into leadership roles.
At the same time, many employees who aspire to leadership positions are unaware that they will be dealing with the challenges of engaging employees. This kind of tool helps aspiring leaders fully understand what to expect. Sometimes seeing everything it takes to be a leader will cause less qualified applicants to bow out of the race, which in turn allows organizations to focus only on those people who are best suited for the roles. There are, after all, few things worse than promoting a leader, only to have that leader find that he can’t hack it when it comes to motivating, energizing, and keeping talented employees. Often, people ill-fitted for their new managerial roles will switch employers rather than stick around for a demotion. Sometimes these people take great talents with them—talents that would have been extremely valuable to the company if the person hadn’t been slotted into a leadership role that didn’t suit the employee.
This kind of survey generates results that can be made available for each individual leader and can be aggregated by various attributes. Organizations then use these results to help prioritize the participant’s development plan, modify leadership training curricula, and design job aids to help new leaders. This data helps organizations make promotion decisions, but also provides every leader or aspiring leader valuable feedback about what they need to do to get that promotion. Even if an aspiring leader doesn’t get the kinds of scores they wanted on this assessment, the message is still, “No worries. Keep working. In fact, here is a list of recommended training programs so you can improve your competency in the areas where you were weak.”
Over the ensuing months, those candidates who embrace the need to learn new skills as a prerequisite to being promoted to leadership role speak volumes to their level of interest. Those who do nothing speak just as loudly that they’re not going to put any work in and shouldn’t be in a leadership role. Those who work hard to improve are willing and able to take that leadership position.
Remember the national sales organization we discussed in the introduction to this chapter? In an environment in which their baby boomer leaders were retiring and the talent pool continued its shift to millennials, they fortunately saw the writing on the wall and made key adjustments to their leadership approach and organizational culture. Since then, they have earned the top spot for customer satisfaction in their industry, literally moving from “worst to first” among their competitors. This is almost entirely because of the significant attention brought to bear on their leaders. They now promote people who are more talented in engagement and retention, they empower them with data from employee surveys, and train them in the full range of leadership skills that engender motivation and create a positive and lively work environment. All of this has led to them keeping more of their best people even in this competitive environment for great talent.
Identification and selection of new leaders is a key process, but the rules in this new era of engagement and retention are different. Broadly speaking, it’s not enough to find charismatic and passionate people anymore. You must also look for engagement and retention competencies. The organizations that take the steps necessary will find themselves in the best position to create a culture that inspires engagement and promotes retention.