A few years ago, when we were searching for a successor to lead one of Cisco’s highest-growth regions, we elected to elevate a younger, local Leader with less experience than the other candidates. Why take the risk? He had a close connection to evolving customers, shrewd instincts about how the market was developing, and a keen sense of the disruption that was needed in the region. In other words, he had the right mindset.
Today, companies must correct course fast, fend off insurgent competitors, and have an intense customer focus. These, among other everyday realities, require leaders to think on their feet. Increasingly, they need to be comfortable admitting that they don’t have every answer. Their ability to act with limited information in a complex environment is perhaps their greatest asset.
As a result, CEOs and boards are disregarding hierarchy more often to fill key positions with savvy leaders one or two steps down in the organization. In a 2015 report, the Boston Consulting Group labeled the occurrence “leapfrog successions.” The shift is especially noteworthy when it occurs at the highest levels. One such leapfrog leader is Chuck Robbins, who rose rapidly at Cisco and skipped a level when he was chosen to be the company’s new CEO, succeeding John Chambers, who became Executive chairman.
This trend has key implications for talent management. Bypassing the usual internal suspects in favor of less expected leaders makes it harder than ever to identify candidates with the right balance of attributes. In my experience, two enduring tools can help organizations identify and develop executives with the ability to exhibit grace under pressure and leap levels:
Executive assessments. We used a two-part executive assessment as part of Cisco’s rigorous CEO succession process. The first was a quantitative evaluation created by Spencer Stuart that is designed to measure a leader’s business and functional competencies against industry peers. The second, more qualitative piece, keyed in on leadership ability based on a multitude of in-depth interviews with the leader’s peers, supervisors, and direct reports done by our internal executive talent team. The result blends qualitative and benchmarked data on other C-suite executives to give us a solid indication of each individual’s abilities, mindset, and development needs.
In one recent leapfrog succession I witnessed, the assessment results were the first indication to the board that the candidate had vast untapped leadership potential. The board built on that and ultimately established that he was a highly viable CEO candidate. In another case, the assessments not only supported what the board suspected to be true about a candidate’s potential but also identified important new information — that she had high followership among peers and advanced leadership instincts.
Assessments are especially relevant for leaders who may need to leap levels. As Spencer Stuart’s James Citrin told me, “Well-designed executive assessments can help predict the potential for future performance of an executive, not just measure past experience.” As part of that, they offer insights into a leader’s reputation, leadership capabilities, behavior under pressure — and many additional intangible qualities that can be difficult to determine in candidates with non-traditional experience or less time leading.
Executive development. Senior-leadership-development programs are a second diagnostic tool to use during the search for savvy internal successors.
For one thing, they provide a platform for observing leaders alongside their cohorts. The way in which a candidate interacts in a group setting indicates his or her level of executive maturity as well as his or her ability to interpret emerging business dynamics. Next, executive development programs offer opportunities to observe leaders in multiple settings. Depending upon the range of the program, many set leaders up in high stakes situations such as customer meetings, investor dinners, and even interviews with the press. How they react in pressurized situations is a reliable indicator of leadership success.
Just as more boards look for leaders who are comfortable operating in complex environments with low transparency and little information, they must also have confidence in a candidate’s readiness to lead at the highest levels. Regardless of whether a successor is an established leader or a leapfrog, boards need multiple data points to see who rises above the rest. Sometimes, as the leapfrog leader trend indicates, the individual who rises to the top is something of a surprise.