How Are You Evaluating Leadership Skills at Your Company?

As a CEO or senior leader, one of your toughest and most important jobs is evaluating the leadership abilities of your employees. "Human capital is your most valuable resource," asserts Will Yakowicz in Inc.

balance.jpgIndeed, the importance of identifying, grooming, and retaining top talent for leadership roles is even more critical today report many executives who say their company's biggest challenges include recruiting and retaining top talent.

Once more, how do you evaluate leadership abilities and potential in your employees? Through the years, a handful of corporations with seemingly endless resources has created systematic leadership development programs that turn out well-rounded, polished executives with factory-like efficiency.

The top five public companies for leaders according to a 2016 ranking by Chief Executive magazine are GE, EMC Insurance, Hitachi Data Systems, IBM, and Johnson Controls. The top five private companies in the same survey were Black & Decker, AlliedBarton Security Services, HAVI Group, Hilti, and Deloitte.

"At a time when CEO tenure is getting shorter, and turnover is becoming more frequent, companies with strong leadership development programs will benefit in the long run by having continuity and predictable depth of talent," said J.P. Donlon, editor-in-chief of Chief Executive magazine.

CEO John Lundgren of Stanley Black & Decker said he likes to mentor his people, either alone or in groups. “I spend as much time as possible with our early-career, high-potential associates to ensure that they understand our values and our strategy and that they are being given appropriate opportunities to develop their leadership skills. It’s hopefully as motivating for them as it is for me.”

Take the 9-question leadership quiz

Compared to large companies that spend millions on talent development and evaluating the leadership potential of its employees, mid-market companies sometimes struggle to allocate funds for developing its leaders.

"A recent study from the National Center for the Middle Market (NCMM) found that less than half of medium-sized businesses (annual revenues between $10 million and $1 billion) are implementing key talent planning processes such as succession planning, development, and performance management," said Chief Executive.

How Can You Evaluate Leadership Potential in Your Employees?

Authors Jeffrey Cohn and Jay Moran of “Why are we bad at picking Good Leaders? A Better Way to Evaluate Leadership,” contend companies don't do a good job of picking leaders. "Let's face it; we are lousy at picking leaders. Time and again, we complain about the quality of men and women who run our companies, organizations, and governments. We bemoan their incompetence, their detachment, their lack of urgency. Inevitably we get rid of these leaders and move on to the next ones usually with a bit of hope and excitement."

The good news is there are methods for evaluating leaders. Sometimes all it takes is outright self-reflection, says author John Maxwell.

For example, "When was the last time you:

  • Reflected on your own leadership?
  • Had your boss assess your leadership
  • Invited your direct reports to review your leadership?
  • Sought feedback from your family on the way you lead?”

According to Robert Mann, author of The Measure of a Leader, it is possible to measure leadership qualities. Mr. Mann should know. He has spent over 43 years developing leadership appraisal tools. Inc. magazine has conveniently summarized four specific behaviors that make a leader effective:

  1. Good leaders are mission-driven and inspire others to join them.
    The organization’s purpose is essential. You must be able to understand the purpose and communicate it to a group of people to the extent they’ll commit themselves to it.

  2. Good leaders create strong organizations.
    A leader must have a good grasp of what the company is organized to do. “Leaders need to understand and manage not only the mission but also the structure of the organization, with sub-leaders who are also important to the company achieving its goals.”

  3. Good leaders have strong interpersonal skills.
    "Interpersonal behavior strongly affects how people feel about the organization's goals, and whether working toward those goals is worthwhile.”

  4. Good leaders are good motivators.
    Leaders can motivate their teams using three different techniques: "Some leaders rely on the exercise of power – coercion – to motivate employees. A second way to motivate is by the exercise of authority granted to a leader who's proved superior ability or skill or commitment. A third way to motivate is with charisma so that people are drawn to the leader," says Mr. Mann.

If you don't have a process in place to evaluate leadership qualities within your company, there are plenty of proven models you can adopt.

"If your employees aren't rising through the ranks, they aren't growing. When employees feel stuck in one position forever, they aren't going to devote their energy to your company," says Inc.

Evaluate Your Own Leadership Potential

Spend a moment to self-reflect on your own leadership skills by taking our short nine-question quiz. Measure how you perform against a list of nine essential leadership traits.

Take the 9-question leadership quiz


About the author

Gary Teagarden
Vistage Minnesota

Gary is an accomplished copywriter and B2B content marketing strategist. He’s written numerous articles and member stories for Vistage Minnesota since 2012.


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