For Talent Management and Leadership Development

Found this article at nzherald.co.nz while doing some research on board’s role in strategic direction.

Crisis comes and goes. There will always be financial crisis, fuel crisis, water crisis, commodity crisis, food crisis etc etc etc. Nothing we can do about it. We can only prepare for it. We can only hope it doesn’t happen, and if it does, we can mitigate it well.

I believe Boards and senior management (executives) are becoming more adept and sensitive to the various crisis, issues and challenges that may come, and very well prepared.

However, one thing we seem to not able to do well is in the area of Talent crisis.

After years of building businesses, we somehow never quite have the hang of it with managing our people. Yes, we put on posters, banners and even in our corporate profiles, saying People is Our Biggest Asset. Yet, one of the biggest laments of Boards and Senior Management past few years is Talent Management and Leadership Development. And Malaysia is not alone in this. The article below attest to that.

I admit, there are companies who are working hard in getting this right. They are only a handful. And I personally know a few of them. I admire their tenacity, even though still faced with teething challenges.

I was involved in a few organizations that wanted to have in place Talent Management and Leadership Development. Crafting the competency matrix, timelines and programs, is the easy part. Most organizations tend to focus on these.

However, in their haste to implement, forget the People factor in all these. Organizations tend to see their people as raw materials in a manufacturing process. Void of feelings, emotions, fears, apprehensions etc. And I admit, I have made that mistake too. We never took the time to actually look at the various people issues affecting the very thing we are supposedly helping, the PEOPLE. Sometimes, we never even asked what these People think of the program we are asking them to go through.

Another mistake we do is, after developing these Talents and Leaders, we can’t seem to know what to do with them. Sounds like the classic Over Promise, and Under Deliver. Compounding the failure of the program.

For this year, MINDA focuses on Innovation and People. We believe these two factors will be the major driving forces for organizations’ competitive edge for business growth & sustainability.

Yesterday MINDA organized a luncheon talk by Mr Stephen Young from Caux Round Table, on “It is People that create value, not money”. It was an excellent presentation. You should have been there.

I doubt we have dysfunctional boards. That is exaggerating the matter. But, there are a lot things Boards and Senior Management can do on ensuring an effective and efficient Talent Management and Leadership Development programs implementation. Providing leadership support and the putting the political will is a good start.

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Dysfunctional boards can cost companies their shirts

By Simon Monks, Ian Smith and David Peters

5:30 AM Tuesday Oct 19, 2010

Chairmen in publicly listed companies in the United Kingdom are supposed to be independent and there's a rule that directors can't stay on a board longer than nine years.

The regulators there say that directors cannot stay on a board for more than three three-year terms. After that, they are deemed to be "part of the furniture" and no longer able to give independent advice or call management to account when they stray.

In Australia last week, former BHP chair Don Argus called for board members to come up for election annually. He backed an international move to annual re-election of company directors to shake up what he calls "serial offenders" and shore up corporate accountability.

"Annual election provides for accountability to shareholders and the ability for shareholders to express a view about the performance of each director as their representative," Argus told the Australian Institute of Company Directors annual dinner in Perth. He said United States corporations were adopting annual re-election "in many instances".

Does New Zealand have an issue with boards?

Yes we do. While most people think that our largest and most august business institutions have sophisticated programmes of chairman and director succession planning, the plain truth is that many of our boards are often not properly set up, they are dysfunctional, they are unstable, they are highly political and they really can't afford to be so any more.

We know of one case where a potentially world-leading New Zealand company failed to develop the right leadership and as a result is now trading at half its former value and being beaten soundly by overseas competitors.

That company failed to understand until it was too late that in order to "go global" you need global leaders. Not just local leaders in local jurisdictions, but truly international leaders who have worked and lived in different global locations and who understand how to operate globally yet think locally.

A survey by Heidrick & Struggles of more than 50 chairmen in the United Kingdom revealed that boards are becoming more intimately involved with the strategy and direction of the companies they serve.

Chairmen are drawing on their own experience and insights to help chief executives develop and adjust strategy, not waiting passively for board presentations.

In New Zealand, we are starting to see the blurring of the roles of chairman and chief executive officer. We predict that over the next few years, an intense and strategic working relationship between chairmen and CEOs will become the new norm rather than the exception.

In our estimation, only 20 per cent of boards are appointed following professional consultation. This has to change.

Simon Monks is a partner in the Auckland office of international leadership advisory firm Heidrick & Struggles. He works in the CEO and board practice. David Peters and Ian Smith work in the same practice in London and Sydney respectively.

By Simon Monks, Ian Smith and David Peters

Article can be found at: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10681450