Solving the Time and Money Puzzle in Leadership Development

Jan Martin Will / Shutterstock.com

Call it the “guilt list.” Most of us carry around in our heads a litany of the things we know we ought to do but somehow never get around to. Whether the task is to get back into shape, clean out the garage, or spend more time coaching staff, good intentions must do battle with inertia and old habits, and all too often, the conflict ends in stalemate. That’s certainly the case with many nonprofit leaders. They grasp the value and importance of leadership development while conceding that it is something they do haphazardly and inconsistently, if it happens at all.

That same split has been reflected in the results of Bridgespan’s Leadership Diagnostic Survey, to which over 515 direct-service nonprofit leaders have responded to date. More than three-quarters (76 percent) agreed or strongly agreed with the statement that “our CEO is actively engaged in building a strong pipeline of future leaders.” Yet 63 percent disagreed or strongly disagreed that “all things considered, our organization is highly effective in developing a strong internal and external pipeline of future leaders.” Clearly, there is a disconnect between intention and action.

Obstacles and Approaches to Leadership Development

Why do so many nonprofits struggle with leadership development? What obstacles lie in their path? Asked to list the most significant barriers that their organizations face in developing leaders, survey respondents repeatedly mentioned time and money. Some representative comments: “In order to lead, you need time to lead.” “Inadequate financial resources to cover training and development costs.” “We are tiny and underfunded.”

How can capital-constrained nonprofits overcome time and money challenges in leadership development? There is one crucial change that leaders can make to kick-start leadership development at their organizations: a change in mindset. They need to approach leadership development not as a separate initiative or an add-on to the organization’s core work but as an everyday activity integrated into the day-to-day actions of the organization. In fact, research by the Center for Creative Leadership has shown that leadership is best learned by on-the-job doing. The Center’s 70-20-10 model, now widely used in the corporate world, calls for 70 percent on-the-job learning, 20 percent coaching and mentoring, and 10 percent formal training. It’s a model gaining appeal among nonprofits of all sizes.

Carolyn Miles followed the path of building leadership development into organizational routine at Save the Children, a global organization dedicated to making lasting improvements in the lives of young people. Promoted to CEO from the COO post, Miles took the reins at a time when staff dissatisfaction with the organization’s leadership development offerings were running high and some of Save the Children’s most talented leaders and staff had left in frustration.

Miles recognized the need to retain key staff and build up the leadership pipeline if Save the Children was to advance its mission. She communicated both formally and informally to her direct reports and other managers that they would be held accountable for developing their direct reports. Crucially, as CEO, she backed up her words with enhancements to the organization’s existing HR processes. She used goal-setting sessions, performance evaluations, and formal check-ins that were already part of the organization’s routines to highlight the importance of leadership development.

For example, when she asked each member of her senior leadership team to identify five or six objectives for the year, she asked that one of the objectives be tied to talent and leadership development. Miles then built follow-up into the process, scheduling twice-yearly conversations with each team member, separate from performance reviews, to discuss progress toward development goals. In doing so, Miles was deliberately integrating leadership development into Save the Children’s organizational rhythms while also modeling the behavior she expected from her team members. Over time, the leadership development mindset instilled in Save the Children’s top team spread to the board and lower-level managers, ingraining leadership development more deeply into the organization’s core activities.

If you care about developing leaders within your organization, or your part of it, you should ask yourself if you are making the most of the organization’s annual performance-review and goal-setting process to drive leadership development. By making the development of future leaders part of each team member’s goals, and by helping staff recognize the development opportunities available to their direct reports in the course of the workday, leadership development can become embedded in an organization’s ongoing activities without draining the budget or adding significant new time demands.

Leadership Development Opportunities

Beyond annual review and planning processes, there are other opportunities for organizations to use what they are already doing as a way to develop leaders. Although many nonprofit leaders associate leadership development with expensive training programs, such formal training is a distant third in the hierarchy of effective leadership training techniques. In fact, a substantial body of research has shown that on-the-job learning has three times more impact on employee performance than formal training.¹ Hence, the 70-20-10 leadership development model that stresses the value of learning by doing. This approach has the most impact when the learning opportunities satisfy four key conditions:²

• • Discomfort—assignments should take developing leaders out of their comfort zones and call on skills other than those they have already mastered. This sort of development inherently involves risks because it pushes people into stretch assignments.
• Accountability—developing leaders must take ownership of their assignments and be held responsible for the results of their work. Along the way, it’s critical to provide the coaching needed to help people address issues that arise in complex situations.
• Clarity—the lesson the assignment is intended to teach should be clear to the developing leader. Frequent debriefing is essential to advancing the development of new skills.
• Relevance—each assignment should teach a skill or competency that the developing leader needs in her current role, as well as in roles she may be asked to play in the future. The level of risk and reward in such situations is often tied to giving staff challenges of consequences where the stakes are high.

The YMCA of the USA has taken the experts’ advice to heart, creating a formal system for making leadership development all part of a day’s work. Its comprehensive development guide, “Developing Cause-Driven Leaders,”³ is a valuable resource for any nonprofit leader who is serious about stocking a leadership pipeline. The guide is full of suggestions for developing leadership on the job within a 70-20-10 framework—indeed, the guide is formatted to prompt staffers and their managers to write individual development plans within the 70-20-10 frame.

A staffer who needs to develop her philanthropy skills, for example, might put 70 percent of her development efforts into researching and writing a grant proposal. Her manager might connect her with an experienced grant-writer with whom she can focus another 20 percent of her efforts on being coached through the research and writing process. She can spend the remaining 10 percent of her time at a grant-writing seminar. The candidate is responsible for preparing the proposal—taking her well outside her comfort zone—and its results. The purpose of the assignment is clear, and its relevance to the staffer’s work is plain.

Other organizations, even those much smaller and with fewer resources than the Y, can do something similar. They can assign a developing leader to make a presentation to the board or to important stakeholders, for example, or place several developing leaders on a cross-functional task force and provide the coaching and formal training they need to succeed. Mentorship is crucial in helping to foster the knowledge and insight developing leaders need to negotiate complex situations while meeting the organization’s needs. With the right guidance, even seemingly mundane activities can become leadership development opportunities.

The CEO can play a key role in this respect by driving the work of matching potential leaders to work assignments that will build the competencies they need. Is the organization about to launch a new project, or does an ongoing activity need additional leadership? What leadership competencies does the project or activity call for? Which potential leaders need to develop those competencies? Senior leaders already put a lot of time into deciding how to allocate work. But they also need to ask whether assignments are handed out and resources are allocated with leadership development in mind. Explicitly factoring leadership development objectives into work assignments and resource-allocation decisions sends a powerful message to the rest of the organization. It also puts into motion the most powerful driver of growth: on-the-job learning.

Getting Started: Building a Culture of Leadership Development

We have argued here that nonprofits can take relatively simple, straightforward steps to help overcome time and money obstacles to leadership development. But in so arguing, we are not suggesting that simple and easy are synonymous. We recognize that nonprofit leaders face very real constraints on their time and resources. But by changing their mindsets, nonprofit leaders can create and sustain the momentum needed to build strong leadership pipelines. The first step is to shed the belief that leadership development is too complex and demanding an undertaking for already very busy nonprofits. By breaking leadership development efforts into small, manageable pieces that build on existing activities, organizations can set in motion habits that take on an energy of their own.

And finally, a bit of overall advice to organizations large or small, financially solid or strapped for resources: add measures on leadership development to your current dashboard or reporting mechanism to monitor leadership development processes. Keep it simple. Track the number of staffers who have worked with their managers to craft individual development plans. Keep count of the number of staffers given stretch assignments. Survey staff to assess their awareness of leadership development opportunities and their engagement in and satisfaction with leadership development activities. Over time, the accumulation of data will help senior leaders spot areas where leadership development is lagging. The data may also show areas of “positive deviance”—departments or functions that are outperforming their peers in leadership development. Mine those areas for best practices to transfer to lower-performing areas.

Once an organization has incorporated a few basic leadership development habits into its everyday routines and rhythms, a subtle change in the culture occurs. Leadership development finds its way into work conversations, and people begin to look at tasks, projects, and functions not just as work to be done but also as opportunities to build leadership muscle. People start paying attention to reports on the state of the leadership pipeline in the same way they might look at reports on fundraising, membership, or program participation. Skilled talent-developers enjoy the respect and admiration of their peers and reports, and the organization gains a reputation as a place where people with high potential and aspirations can make the most of their abilities. By developing a cadre of up-and-coming leaders, CEOs can free up the time to focus on current and emerging strategic priorities as the organization grows. And just as important, the organization becomes stronger, more sustainable, and better able to pursue its mission —precisely what leadership development is meant to achieve.

Kirk Kramer is a partner with The Bridgespan Group and head of the organization’s leadership initiative. Preeta Nayak, a manager in Bridgespan’s San Francisco office, manages the leadership initiative. They are coauthors of the just-released guide, Plan A: How Successful Nonprofits Develop Their Future Leaders, to be published in hard copy in January.

Sidebar:

Set Leadership Development in Motion

Tips for leaders determined to overcome obstacles to leadership development

• If time is the primary obstacle, consider adding a personal- and organizational-development objective to the annual performance goals of each senior team member. The organizational calendar may already include periodic review meetings for discussing progress against other goals. Capitalize on these meetings by adding talent-development goals to the agenda. And if team members fall short of those goals, factor that into their annual performance evaluations. At the same time, be ready to coach and counsel those who are struggling to develop their staff.
• If size and money are primary obstacles, ask whether assignments are handed out and resources are allocated with leadership development in mind. Particularly in small organizations where there are fewer positions, explicitly factoring leadership development objectives into work assignments and resource-allocation decisions sends a powerful message to the rest of the organization. It also puts into motion the most powerful driver of growth: on-the-job learning.
• If lack of commitment from the top is the primary obstacle, put leadership development on the front burner when senior leaders meet. CEOs who persistently raise the issue with their senior colleagues and link leadership development to longer-term strategy signal their engagement and set priorities for the rest of the team. Add leadership development to the board agenda at least once a year.