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How multinationals can improve their leadership development


By Sabine Vollmer

Multinational companies require leaders who can deal with challenges that accompany rapid global business expansion, but only 23% of human resources executives at multinationals identified their leaders as “very capable”, and just 22% of the leaders themselves felt prepared, research found.

Talent management consultants Development Dimensions International (DDI) and The Conference Board polled more than 3,000 executives at companies doing business in three or more countries. They detected a handful of detrimental forces.

Too many inconsistencies (according to 40% of respondents) or too much corporate control (13%) doom leadership development initiatives in multinationals, as do a lack of skills and experience within HR to operate globally (27%), and poor understanding of cultural differences at the design stage (9%) and implementation stage (11%) of global leadership development programmes.

Leaders may also encounter individual challenges, said Patti Gillenwater, CEO of executive search and leadership development firm Elinvar.

What she has most frequently encountered are leaders who have hit a developmental plateau. “You have very smart people with excellent technical skills, who have been rewarded and promoted for what they’re good at,” Gillenwater said. “But they are typically not great with the softer skills.”

One-on-one executive coaching that is tied to specific goals is a good way to teach them soft leadership skills such as strategic thinking, relationship building, and working across silos. That’s especially important when mid-level managers transition to senior management.

To address organisational challenges, DDI and The Conference Board suggested that multinationals consider applying Big Data analytics to leadership development programmes. But it matters what data are gathered. Forty-one per cent of the executives polled said they don’t do leadership analytics well.

Analytics that tend to have a stronger financial impact gather results metrics about leadership programmes and use data to forecast future leadership talent needs. No more than one-fourth of respondents used those high-value analytics. Low-value analytics were more frequently used. About one-third of respondents said their companies gathered efficiency and reactions metrics about leadership programmes and benchmarked leaders against peers within the company, analytics that tend to have a weaker financial impact.

DDI and The Conference Board also suggested broadening the pool of high-potential talent to the top 15% to 30% for optimal engagement and retention and to improve the learning experiences on expatriate assignments. On average, respondents in the DDI and The Conference Board poll reported an expatriate success rate of only 58%.

DDI and The Conference Board also recommended that multinationals consider these six practices to develop leaders capable of meeting the challenges in a business that is rapidly expanding worldwide:

  • Clearly define competencies required to succeed in key leadership positions.
  • Link leaders’ performance expectations to the company’s strategy.
  • Establish leadership competencies that serve as the foundation for multiple leadership talent management systems.
  • Equip leaders with high-quality, effective development plans.
  • Schedule regular reviews for leaders to go over their development plans with their managers.
  • Have leaders practise key skills with their managers to receive feedback.

Related CGMA Magazine content:

On the Road”: As organisations look to expand in emerging markets, they increasingly must decide whether to hire locally or send somebody from the home office. Each has its own set of unique challenges and benefits. CGMA road warriors offer their insights.

Emerging Market Multinationals Must Grow Leaders From Within”: Leadership teams at multinational companies based in rapid-growth markets need more international experience and a proper balance of global and local expertise, according to an E&Y survey.

Sabine Vollmer (svollmer@aicpa.org) is a CGMA Magazine senior editor.