Art Petty on Management

Art Petty on Management Has Changed and Moved

I don't like to do things small or simple, so in what I sincerely hope is the absolute last time I put myself and you through this, I have moved and changed the name of my blog. 

You will now find me at www.artpetty.com and the new name of the blog is Management Excellence.

As I'm writing this and realizing that most people that have moved blogs have basically had to start over from zero to build traffic, this seems like taking two steps in the wrong direction.  However, sometimes you have to step back to grow, and I've got some compelling reasons for making the move, including:

• Integrating my former corporate web site and my blog under one content management system.

• Creating a simpler url (artpetty.com...12 characters versus the almost 40 for this site).

• Gaining the tools and the control through a hosted blog so that I can easily add planned podcasts, webcasts, forums and other tools that I will roll out this year.

• Aligning my blog's name: Management Excellence with my personal mission to promote high performance, great leadership and the pursuit of excellence in business.  

All of the posts and hopefully, all of the comments have been moved to the new site, so 14 months,  160 plus essays and a tremendous number of thoughtful comments on best practices in leadership and strategy, project management, product management and marketing and sales, all remain part of the library. 

For those of you that subscribe via your favorite Reader or happen across this post via Search, please take the opportunity to visit the new Management Excellence site and click on the site's feed.  And don't forget to check out some of the new tools, including the live polls, free down-loadable tools and links and references to many other great resources.

Thanks so much for reading and referencing Art Petty on Management, and I hope to earn your confidence many times over in my new home at the Management Excellence blog!

Improve Strategy and Execution Planning with Project Management Practices

I’ve danced with this topic before (Struggling with Strategy? Think Project Management), and the more experience that I gain helping clients improve the effectiveness and efficiency of their strategic planning and execution program development activities through project management practices, the more sold I am on the approach.

In my experience, many of the biggest gaffes in strategy and execution planning processes occur because the common-sense steps of the Project Manager are ignored, often because a functional leader or worse yet, an executive is charged with running the project. 

Just a few areas where I’ve observed complete strategy project derailment because good project management practices were ignored:

• The meetings grind down in a never-ending sea of fact-finding, debate and then more debate.

• Instead of focusing on strategic issues, the discussions quickly shift to short-term operational issues.

• Tools are misapplied.

• The deliverables are a powerpoint deck and a bunch of disgruntled participants that realize that they will never get the time that they just wasted back again.

• Insular groups that practice strategic planning like it is a combination of Voodoo and a secret language, complete with a secret handshake for entry into meetings. 

• Ideas are generated, but there is no mechanism to turn them into actions.

• Actions take place but there are no mechanisms to evaluate relative success and gain lessons learned

• A strategy is created but the organization’s employees are not tuned in to the strategy well-enough to understand how to connect their priorities to the strategic objectives of the firm.

• The Voice of the Customer is never heard.

And so on…

Enter the Project Manager armed with skills required to improve the odds of success.  I encourage management teams to treat a strategic planning cycle as a series of projects, and to engage a senior-level project manager to run the process.

Suggestions to Improve Strategy and Execution Program Effectiveness include:

• Creation of a Charter and the assignment of an executive sponsor that is responsible for the success of the initiative.

• Identification of core Strategy Team members, and their responsibilities/accountabilities in the process.

• Development of a clear scope document that defines priorities and deliverables.

• Communication of the Charter and Scope materials by the Executive Sponsor and Project Manager to the broader organization to promote understanding and to gain support for involvement in data gathering and brainstorming as well as future sessions on execution.

• Project Manager working with the core strategy team to define up-front data needs, to help identify the project’s work breakdown structure and to coordinate scheduling and resources for upfront data gathering.

• On-going monitoring of work teams that are handling early phase data gathering, market assessments, customer interviews and competitor analysis.

• Monitoring and control of the project to ensure that it moves relatively smoothly through the phases from definition to data gathering, assessment, options identification, options analysis, options selection and execution program definition.

• Once options are identified and selected, these define logical projects, and the Project Manager and PM team are already in-place to hit the ground running in helping to move ideas into actions.

The Bottom-line for Now

The application of professional project management practices to the strategic planning and execution program development cycles of an organization can eliminate many of the common pitfalls that derail these programs. 

While the Project Manager cannot guarantee that the insights and actions developed during strategy are the right ones, he/she can take away the organizational-risk that so often rears its head to doom the best intended initiatives.  Instead of shooting yourself in both feet while running a footrace, let the Project Manager shoulder the weapon and leave you free to run fast and hard towards creating value for your customers and stakeholders. 

Sustaining Performance Excellence in Business and in Life

It genuinely bothers me when organizations spend years and untold dollars reinventing themselves and succeeding with a quality framework (i.e. Baldrige or Six Sigma) only to show up in the business press as an organization fighting for survival. 

It’s like the obese person with one foot in the grave suddenly committing to health on America’s Biggest Loser and at the end of the program, successfully completing a marathon. For a moment, life is good and our belief in our capacity to do anything that we set our mind to, restored.  Certainly the experience and lessons-learned during the successful journey to improve have changed this individual’s life for the better.  And then, we glance at the tabloid cover in the grocery store checkout line to see a picture of this fat then fit and now fat again individual working out with a box of Krispy Kremes.

I wrote a related post a few days ago with the harsh title of Change or Die, and upon second thought, the title should have been: Change & Sustain or Die.  Organizations and people are fairly adept at changing for a moment at the end of a gun barrel, but they are not so good at sustaining the change when the barrel is no longer pointing their way.

• There’s the former Baldrige winner that lost their CEO in an untimely passing.  The new leader took a cost cutting mentality and ended up cutting out programs and people critical to the organization’s focus on performance excellence.  The ensuing performance included a stint in bankruptcy.  That’s a bad case of the Baldrige Blues.

• Motorola is given large credit for helping create the Six Sigma Quality framework.  Their focus on process improvement and their Baldrige award are legendary and define the culture.  The company is fighting for survival, mired down in completely forgetting the Voice of the Customer in pursuit of endless elegant iterations of cell phones that no one wants.  Their imbalanced scorecard had them losing $12 for every device they sold last quarter and burning through billions with a “b” in cash over the last year. 

• Ford.  Enough said.

• GM, don’t get me started.

It’s not like Toyota withheld key information about the legendary Toyota Production System and the many other business practices that they learned by applying Deming’s principles, studying the writings of Henry Ford and the unique innovations in the operations of early supermarkets in the U.S.

• Circuit City.  See ya.  (OK, this one is unfair…they never achieved any form of recognizable Performance Excellence.)

The Bottom-Line For Now on Sustaining Performance Excellence

Leadership is always an issue when it comes to performance, and in my opinion, it is THE issue when it comes to sustaining excellence.  The various Quality frameworks offer essential directions for the never-ending journey in pursuit of creating value and continuously improving, but the secrete is that there is no final destination.

Achieving milestones and winning awards helps reinforce the progress on the journey, but leaders at all levels have to foster a culture that is perpetually dissatisfied.   The fact is that the market never sleeps, customer issues/needs change constantly and there are always competitors interested in taking your share of the customer’s budget.  

An MBA student reminded me the other night of Andy Grove’s (Intel) classic book and philosophy: Only the Paranoid Survive.  Perhaps we should work on a Balanced Scorecard measure for Paranoia.  Actually, that raises an interesting question.  What do your metrics and measures and scorecards truly tell you about whether you are continuing the upward climb or falling backwards, potentially into oblivion? 

Hey leaders, wake up.  Someone’s going to have you for lunch while you are busy basking in the glow of your latest quality award.  And speaking of lunch, do you know how long it will take you to work off that piece of carrot cake?  Just say no to the dessert and get to the gym tonight.  You're looking a little pudgy.

Another related post: Does Your Dashboard of Performance Measures Include a Warning Light?

Managing Resistance to Change

At the risk of showing my inner-nerd, one of the more memorable sayings from the Star Trek series of shows (post Kirk & Crew) is: “Resistance is Futile.”  This of course was the mantra of the Borg, a race of part-human, part machines that sought to assimilate all life-forms into their collective.  Of course, their fatal weakness was that they were only able to operate as a collective…and lacked the many characteristics that ultimately serve as advantages and that make us distinct as humans.  (OK, I suspect that I’ve gone beyond showing my true nature and nerdiness.)

Resistance to Change in corporate life is a very real force, and of course, the bane of existence of the many advocates of change challenging you to put aside your fears and embrace the new way of doing things. 

H. James Harrington, writing in Quality Digest in an article entitled: Managing Resistance to Change—How to handle the inevitable, offers some insights and perspectives on dealing with this very powerful and limiting force in pursuit of a shift away from an organization’s status quo.  He writes:

“Sponsors who drive change tend to think of resistance as an inexplicable but avoidable force that affects people. When resistance occurs, they believe it’s actually a result of somebody’s failure. Typical responses are, "What’s wrong with that person? What’s wrong with that group? Why won’t they support our change effort? There must be something wrong with those people." In fact, such a perspective is a major barrier to successful change.”

Most so-called change agents when faced with resistance will adopt the universal tool for breaking through…the organizational sledgehammer.  Instead of finesse and psychology, resistance is often met with arguing, imploring, and something a bit more insidious…political approaches to gain compliance or eliminate the roadblocks.  Alternatively, Harrington offers: “Expect resistance and manage it, either through a preventive or healing approach.” 

His fine and short article reflects a “seek first to understand and then be understood” philosophy to dealing with this inevitable characteristic of organizational life.  Check out the rest of the article for his prescriptive guidance on dealing with resistance.

The Bottom-Line for Now:

Resistance to your agenda for change might seem futile to you.  After all, who can argue with the expected benefits that you’ve so eloquently and logically outlined.  As Harrington indicates, you are going to pay for resistance up-front by dealing with it, or your going to pay during the life of the initiative.  Some resistance can be overcome through training and education and the rest will only be solved with accountability measures.  Proper investment up-front will hopefully minimize the cost and pain as the initiative unfolds.

In Search of the High Performance Team

A special note: today is Veterans Day

While we may struggle in business to consistently produce high-performance teams, our soldiers in service of our country live this on a regular basis.  Thanks to those who have served, those who are serving and to all who have sacrificed.  Our gratitude has no end. 

In Search of the High Performance Team

I regularly poll my seminar participants and MBA students on their team-focused experiences in the workplace and I am consistently surprised when very few report ever being part of something that they would classify as a “high performance” team. 

The results of my unscientific polling are all the more surprising given that we live during a time when involvement in short-term projects with individuals across functions is a part of the regular work experience of most professionals. 

The business literature is filled with articles and interviews from leaders and pundits on topics tied to innovation, business execution and team heroics.  Of course, the same companies tend to be the focal point of these articles.  It seems like we cannot get enough of the stories of heroics pulled off in companies like Apple, Ideo Google and the few others that seem to make the short-list for the popular business press.  It’s curious that those companies got the memo on creating high-performance teams and the rest of us are relegated to reading about their successes.

When I ask about involvement on high-performance teams, there is invariably someone in the audience sharp enough to ask me what I mean.  Admittedly, my definition is one of those kind of squishy, you’ll know it when you experience it answers.  It’s also a multi-part answer that goes something like this:

• A high-performance team is a group of people that have figured out how to work together to knock down and succeed in pursuit of audacious goals.  They’ve learned to leverage their respective strengths, compensate for weaknesses and tap into the power that a group of people uniquely focused on a goal are able to generate.

• High-performance teams thrive on challenges, revel only momentarily in successes and mostly seek the next big challenge.  They tend to be paranoid about becoming overconfident and in general, they don’t seek significant public recognition.

• The working environment on this team is comfortable for collaboration, encouraging of disparate opinions and singularly focused on turning ideas into actions. High-performance teams are self-policing.  Values and accountabilities are clear and there is an explicit expectation that membership requires honoring the values.   Membership on this team is a true privilege.

• The leader on a high-performance team recognizes that his or her role is teach, to knock down obstacles and to constantly focus on creating the environment that allows others to succeed at high-levels.  This leader may be tough, but this leader tends to be quiet, letting actions talk.  You generally won’t find this leader to be loud and boisterous, although they may be a great cheerleader as well as a stern disciplinarian behind team walls. 

The Bottom-Line for Now:

Effective leadership is a pre-requisite for the creation of a high-performance team.  Perhaps if more leaders focused on their responsibility to empower others, I would see some more hands raised when I ask about whether your employees have been part of a high-performance team.  It’s not too late to start working on this.  

Change or Die

Perhaps it is human nature, but we tend to eschew change either in our personal habits or in business settings until we are faced with mortality. 

In organizations, most significant change occurs during times of crisis when the threat of extinction sufficiently motivates individuals and groups to consider changing long-standing ways of doing things.   The crisis brings into stark focus the fact that it is easier and less costly to accept or embrace change than it is to suddenly become extinct.  Unfortunately, by the time this clarity is achieved at the top leadership levels, it is often too late.

As difficult as it is to follow the news everyday, we are living and working through a period of time when the extinction of firms and industries is taking place in front of us, like some business simulation game gone horribly wrong.  The game unfolds like this: focus only on short-term results, add in a measure of personal greed, consistently make the wrong decisions and act shocked as the results spiral out of control to the final act….a low probability of success, last ditch effort gambit (or bailout).

For some, the distance from the top of the Mount Olympus to the graveyards and swamps below is fast and furious.  The suddenness and rapidity of the fall is shocking, but perhaps easier to digest than those firms that have systematically planned their own demise step-by-step as they move from Masters of the Universe to what will soon be footnotes in our history books and business texts. 

As in life, there are no guarantees of survival…there is no prescriptive formula that says “if you do X then you survive and prosper,” but there are methods to improve your odds. 

How to Improve Your Odds of Survival

• Senior leaders must embrace the fact that survival and prosperity occur only at the pleasure of customers.  Instead of giving lip service to the importance of customers, you need to develop systems to constantly seek out, understand and translate into actions the Voice of the Customer.  This is remarkably difficult to do in practice and requires for many an impossible shift in culture and values.  Nonetheless, you must change or die.

• Senior leaders must embrace the fact that without motivated, dedicated employees they have nothing.  There can be no doubt that satisfied, engaged, respected, informed employees are essential for survival and success.  Why then are our systems and our managers and leaders so often at odds with what it takes to create an environment where employees will gladly give their best.   The poor leadership habits that are vestiges of another era must change or you will die.

• Call it total quality, performance excellence or whatever you want, but you must embed the notion of high performance and all that it takes to achieve it into the DNA of your organization’s culture.  Success can breed success or it can give birth to complacency.  An unyielding focus from the firm’s leaders on creating a high performance culture is required.  This means that the fire-fighting mentality must stop, clear performance/quality priorities  established and the systems developed to allow these to succeed and for people to learn in the process.  You must change to create a learning organization or you will die.

The Bottom-Line for Now:

Change or die.  It’s that simple.

Does Your Dashboard of Performance Measurements Include a Warning Light?

Count me as one of the last idealists.  Or perhaps the last of the naïve idealists.  In a world filled with Quality Management Systems and Performance Measurement techniques backed by legions of people trained to implement and sustain quality performance, it seems reasonable to me that organizations are capable of not only keep themselves from imploding, but that they are armed to the teeth with tools to ensure prosperity beyond the wildest dreams of  Dr. Deming. 

As an aside, Dr. Deming once famously indicated that it was his hope that his legacy was to keep U.S. companies from committing suicide.  Perhaps it is good that he is not here to see the firms elbowing each other out of the way in an attempt to get to the front of the line on the edge of the cliff.

• The U.S. auto companies are almost finished carrying out their joint suicide pact in a world where the rules for success as an automobile company are on display for everyone to see. 

• Motorola, an icon of U.S. electronics has systematically destroyed itself by flailing and flailing in the mobile device (read: cellphone) world, and stands a reasonable chance of failing to survive without drastic action.   (See my earlier post on the Dollar Bill Auction to get a feeling for Motorola’s problems.)  The fact that Motorola is a Baldrige winner, one of the founding fathers of Six Sigma and an organization staffed with brilliant engineers, yet it cannot seem to engineer success is both puzzling and frustrating.

• Earlier this week, Boeing indicated that they would again delay the launch of its now several years late and much hyped 787 Dreamliner.  The article indicated that the latest problem had to do with quality issues related to a new type of fastener required for the high tech and lightweight materials being used in the plane.  The advance sale of 900 of these puppies at $178 million a piece and the expected 20% fuel consumption savings has customers hopping mad over this latest in a series of seemingly endless project management and supply chain problems. 

• Financial services, banking, investment banking.  Ugh.  These icons of risk management succeeding in maximizing risk beyond their wildest expectations.

How does this happen in a world filled with balanced scorecards and legions of certified quality professionals constantly measuring, monitoring and striving to improve performance?  I suspect that my own answer is that while we have ample tools available for our use in building, the one tool that we haven’t yet mastered is staring back at us in the mirror.

In discussions and lectures with the up and coming generation of leaders, there is widespread cynicism over the intentions and the capabilities of many of their firm’s senior leaders.  There is little faith expressed that their leaders understand their firm’s key drivers and little confidence that the leaders are taking actions and measuring performance based on anything other than preconceived notions of what they think is right.  Fewer organizations than you might think are doing anything to engender employee satisfaction…which is ironic given the mountains of data that indicate that employee satisfaction flows through to customer satisfaction and strong financial performance.

This current generation of senior leaders is failing, and the very imbalanced scorecard is visible all around us.  The business cycle is one thing, but our problems go way beyond the business cycle to our preconceived notions of how to lead, how to run businesses, how to fuel innovation and how to create an environment where talent and calculated risk-taking are carefully cultivated. 

Many organizations are hives of activity with no vector and the output is chaotic. Firms and top leaders need to quit guessing and start using the tools available to identify key business drivers and to measure and monitor the efforts and outcomes of focusing on those drivers. 

The Bottom-Line for Now:

There’s nothing like a good old-fashioned crisis to engender creativity.  Well, we have one.  In spite of the difficulties, it’s a great opportunity for organizations and leaders to quit paying lip-service to cliché’s like customer-satisfaction, performance excellence and quality.  It’s a big world with a growing population and while the forecast is stormy now, the seas will eventually calm and the sun will shine.  It will be interesting to see who has the courage and fortitude to do the things necessary to make it through the storm.  Even money that we find a whole new generation of leaders in the process. 

 

October 29th Carnival of HR (and much more)

Readers interested in some divergent thinking and great ideas should take a look at the menu of authors and content at the latest Carnival of HR.  And don't let the HR headline trick you.  This Halloween collection of articles covers diverse topics in leadership, communication, execution, talent development and priceless career advice.  Oh, and of course, Dan McCarthy, the host, was nice enough to include my recent attempt to place a quantifiable value on leadership development activities.  Check it out, it's definitely a treat. 

In Hopeful Praise of the Millennials

To read the articles “The Trophy Kids Go to Work” (WSJ, 10/21) and especially to view programs like “Here Come the Millennials” (60 Minutes), you would be justified if the thought of what life will be like managing and working with this unique generation caused you to roll your eyes and reach for the aspirin bottle.

However, I suggest that you think twice before you prematurely write off the 80 million people born between 1980 and 1995.  While most of these individuals have grown up with us as “Helicopter Parents” hovering over nearly every activity of their lives from play-dates through college-enrollment and even job interviews.  I’ve seen glimpses of the future and I am encouraged about the potential for this generation. 

Much of the content around the Millennial generation focuses on their slightly sheltered upbringing, the emphasis on encouragement that we have provided in the form of constant praise and awarding trophies for just showing up and the widely reported unrealistic expectations that they have about life in the real world of work. 

In particular, the 60 Minutes piece (great fun to watch, although watch out if you are showing it to a group of Millennials) goes out of its way to hype the different and potentially selfish expectations that members of this new professional generation bring to the work environment.  Things like interesting work, flexible work hours, the freedom to be comfortable, the freedom to remain connected to the technology that they’ve grown up with, are all identified as issues.  Additionally, the group has expectations for rapid advancement and the ability to gain access immediately to those residing in the rarefied air of executive suites.  Hmmm.  So far, I’m not offended, and in fact, quite the contrary, I like the confidence and clarity of purpose that seems to be inherent in this generation.

The very wrong perspective on Millennials is that they are as a group, lazy.  Far from it, but they are restless and demanding.  Don’t ask them to pursue purposeless work, don’t expect great things if the job demands have them killing time, don’t minimize how important it is for them to be connected and to receive feedback, and most of all, don’t underestimate them.

This is the most technologically advanced generation of individuals in the history of the planet.  They’ve grown up using technology to multi-task, to reach large number of people in a hurry and they seem to have a different frame of reference on time than prior generations.  Communication is instantaneous, feedback is constant, brand is everything, fads are born, mature and decline in real-time and this group keeps moving, learning and creating. Sounds a lot like the business environment that we find ourselves struggling to understand. 

They may not know what they want to do for the next 30 years (an incomprehensible amount of time to think about work), but they do know that they are smart and adaptable and they are clear on what they don’t want to do: waste time like many of their parents fighting a losing battle with loyalty-free corporations.  There is little interest in “paying their dues” and frankly after having watched their parents over-pay their dues to be rewarded with life in a world that looks frighteningly similar to the Dilbert comic strip, who can blame them for wanting something different.

Whether I’m engaging with the older Millennials in my MBA classes or watching my own sons and their friends grow up, I can think of countless examples that make me excited about the impact that these people will have on our world.  The MBA students are wicked-smart and frighteningly worldly for their youthfulness.   The creativity and good character that I perceive in the older teens that I come in contact with are both exciting and reassuring.

My son on his own volition is traveling a great distance this weekend to spend a few minutes at the memorial service for a high school coach who passed unexpectedly.  He’s doing this because he knows that this is a simple token of respect and thanks.  It turns out that this coach’s former players are coming from around the country to spend a minute to say thanks to one from our generation that took the time to see the potential in them.  You wouldn’t recognize this loyalty and sense of responsibility from the content in the popular press about this generation.  It’s there, but it requires our own creativity as managers, leaders and parents to figure out how to tap into it.

The Bottom-Line for Now:

I’ll opt for the dissenting view on the Millennials.  Where others see management headaches, I see fire, creativity, passion, skill and maybe the capacity to face a world that looks very much the worse for our efforts.   Maybe, just maybe, this group will earn the label of The Next Greatest Generation.  Perhaps like the coach referenced above, you can still make a difference by helping this generation realize its potential. 

Overall, I’m encouraged and hopeful.

In Search of a Quantifiable Return on Leadership Development

Every few months, I run head-on into a discussion with someone (usually a prospective client) about how to value the return from investments in leadership development.  The question is not asked as a means of qualifying my services, but rather as a genuine practitioner-to-practitioner inquiry, not dissimilar to what two MDs might talk about with respect to the latest treatment results for an experimental drug program.  The person asking knows as well as I do that Return on Leadership Development continues to be an elusive issue that no one has substantively put to rest, and that our best answers are no stronger than impassioned, qualitative opinions. 

The venerable consulting firm, McKinsey & Company in their latest issue of The McKinsey Quarterly (2008, Number 4) offers some exciting results showing: “the relationship between financial performance as measured by profit per employee and ten dimensions of global management talent.”  Their findings: “Companies scoring in the top third of the survey (when all ten dimensions were combined” earned significantly higher profit per employee than those in the bottom third."

The McKinsey results showed strong correlations in three specific areas:

• The creation of globally consistent talent evaluation processes

• The management of cultural diversity

• The mobility of global leaders.

McKinsey indicated that the firms scoring top-third in any of these three areas had a 70% chance of scoring in top-third for financial performance.  Alternatively, companies scoring poorly on these practices had a strong chance of ending up in the bottom third for financial performance.

This is exciting information for anyone and everyone interested in gauging the impact of leadership development initiatives on corporate performance, however, before we consider this case closed, it is important to note McKinsey’s own comment that, "the study results do not show any true evidence of causality, but rather that the results, strengthen our belief that these are important areas on which businesses and HR leaders should focus their attention.”  It always comes down to belief.  Welcome to my conversations, McKinsey.

Should it Be Return on Expectations?

Another interesting thought comes from Professor Albert Vicere who describes his experience facilitating a group of executives through a discussion on how to calculate a return on leadership development:

“Discussion on how to calculate a return on leadership development and learning investments were frustrating until we saw the light, stopped talking about return on investment (ROI), and began talking about return on expectations (ROE).  Participants agreed that due to all sorts of complications we may never be able to calculate a clear financial return on learning initiatives, but if we’re clear on what we’re trying to accomplish through leadership development and learning and if we measure our results against those expectations, we may have the data we need to prove the value of our investments.”

OK, at least this group is giving us a reason to accept that valuing leadership development is a tough task. It is good to know that a bunch of smart people sat around thinking about this dilemma and the best that they could come up with was looking at from a different perspective.  They may be right, and the careful expectation setting and measurement around very specific leadership development initiatives may just yield the elusive data that we’ve been seeking.

Is it time to sharpen Occam’s Razor?

More often than not,the rough translation of  Occam’s Razor: “All things being equal, the simplest solution is the best,” proves true.  My non-statistically significant, can’t prove causality hunch is that effective leadership development practices are part of a whole system and that attempting to value them independent of the other components, while intellectually stimulating, is essentially valueless.  This is perhaps like attempting to value the worth of having a healthy heart in a cancer ravaged body or a healthy body carrying an artery-clogged heart.  No matter how you look at it, the body and organizations function as complex systems and a problem in any one part can adversely impact issues across the entire system. 

Aren't These The True Measures of Leadership Development's Value:

•    Quality
•    Financial health and performance (company and versus industry)
•    Innovation
•    Ability to Execute on Strategy
•    Employee Satisfaction
•    Customer Satisfaction
•    Growth versus industry participants
•    Retention and advancement of the right people and elimination of others
•    Fulfillment of mission
•    Growing contribution to community and society

The Bottom-Line for Now

If these items are generally accepted and desirable outcomes of a well-functioning organization, then executives looking at their talent development programs should quit focusing on the search for discrete ROI measures, and instead focus on identifying those practices that are likely to contribute the most to the above.  We may not prove causality, but just like McKinsey, it is my belief that focusing on becoming great at the right few talent and leadership development practices will yield higher performance than not focusing on these issues.  My vote says focus on: individual development planning, feedback and widespread involvement in strategy creation and execution, and the results will come and the other leadership development pieces will naturally fall into place.  Oh, and the decision on how to invest in development activities is a management team decision, not just an HR call.  Leadership Development is everyone’s business.