Despite Cutbacks, Firms Invest in Developing Leaders

Despite Cutbacks, Firms Invest in Developing Leaders1

Companies Renew Focus on Employee Training, Betting That Strong Managers Will Help Through the Recovery
Despite layoffs and recession-starved budgets, many employers are investing in leadership-development programs, hoping not to be caught short of strong managers when the economy recovers.
Identifying and grooming leaders is important in good times, says Bret Furio, senior vice president of consumer lifestyle for Philips Electronics North America. "In times of crisis when the economy is struggling," he adds, "it's imperative."
Like many companies, Philips Electronics NV is trimming its training budget this year. A December survey of 117 large U.S. companies by Watson Wyatt Worldwide Inc. found 23% of respondents had recently cut training programs, and another 18% planned to do so this year.
But Philips will offer its annual Inspire program for 30 high-potential employees, stressing subjects such as business strategy and personal leadership. Participants are assigned to teams to work on a business project. Mr. Furio reasons that investing in leadership development will help Philips through the recession and the recovery.
In a nod to the tough times, Philips trimmed the budget for Inspire, eliminating one tutor and tapping more employees, rather than outsiders, as trainers. It's holding the program near Seattle and Boston, where Philips has many employees, saving the company transportation costs. Last year, one seminar was held in Huntington Beach, Calif.
Philips is typical of many companies, according to Bersin & Associates, a research firm that studies corporate training. Bersin estimates that companies cut overall training budgets 11% last year and projects another decline this year, based on a recent survey of human-resources executives. President Josh Bersin says the deepest cuts are in training for "soft skills" such as communicating with co-workers and conducting meetings. He says leadership development is taking a growing share of training budgets.
Yaarit Silverstone, global managing director for the organizational-effectiveness practice at consulting firm Accenture Ltd., says the emphasis on leadership development is a departure from the past. Ms. Silverstone says companies historically cut leadership-development programs during downturns, but the moves backfired, prompting midlevel managers and top performers to leave when the economy recovered. Now, she says, executives believe that without capable managers, "their ability to come through [the recession] in a healthy fashion is diminished."
Consider Estée Lauder Cos. The New York cosmetics maker Thursday reported lower sales and profit for the period ended Dec. 31, and said it would eliminate 2,000 jobs over the next two years. But Lauder is continuing its leadership-development programs, albeit more cheaply. Lauder typically sends 120 executives to a two- or three-week summer program at Vassar College. This year, it plans to send 60, for one week. In all its leadership programs, Lauder will emphasize innovation and managing change in volatile business conditions.
The budget cuts are hurting business schools, which say companies are sending fewer employees for executive-education courses and ordering fewer custom programs, which can cost hundreds of thousands of dollars. David Newkirk, CEO of Executive Education for the University of Virginia Darden School of Business, says the school began to feel the downturn early last year, as financial companies deferred decisions. He says few companies have dropped programs completely, but many are delaying custom program enrollment by six months or so as they watch expenses.
But leadership coaches say they're still in demand. Author and consultant Paul Hellman has been expecting a slowdown, but says December was his busiest December ever. Mr. Hellman, president of Express Potential, says employers know employees are less likely to jump ship during the recession, and are exhibiting a "let's make sure people are developed" mentality. He says he sees companies cutting costs by using more Web training than in past years; he hosted four "Webinars" in January, compared with six for all of last year.
That's the case at Canon USA Inc., which launched "Canon Academy" in 2008 to expand leadership development. This year, the camera and office-equipment maker is combining Web tools and instructor-led courses to offer training to more newly promoted managers than in the past. The program will touch on strategic decision-making and influencing employees. "Certainly times are tough, but we recognize that employee development needs to continue," says David Metzger, Canon USA's director of management development.
Some consultants see a renewed focus on leadership development, even at companies that are laying off employees. Patrick Sweeney, president of Caliper, a Princeton, N.J., management-consulting firm, says companies are trying to grab managers' attention and focus them on "keeping the ship afloat." Mr. Sweeney says much of Caliper's current work is geared toward identifying employees with high potential and developing their leadership skills.

1- Dana Mattioli, (2009, February, 09). Despite Cutbacks, Firms Invest in Developing Leaders
Companies Renew Focus on Employee Training, Betting That Strong Managers Will Help Through the Recovery. Wall Street Journal, B4.

FACT: IN GREAT COMPANIES, CEOS SPEND OVER 50% OF THEIR TIME THINKING ABOUT PEOPLE.1

(And here’s a secret: These CEO’s are
thinking about talent, not just people,
because talent drives results whereas
people may just be driving
expenses.)

Talent: Is the main concern of great
CEOs. They continually assess, select
and position talent to meet strategic
needs. And what do you think the direct
reports of these CEOs do? They do
what the CEO does. CEOs cast a large
and influential shadow throughout entire
organizations.

THREE TRUTHS ABOUT TALENT:
1. Talent (not people) is your most valuable
asset. Talent is what distinguishes
the good from the great. Studies show
that a great employee is worth over ten
times an average employee in the same
job. Just think about the difference in
contribution between your best employee
and an average one.

2. Talent is scarce in South Florida. This
one is so well documented you don’t
even need the details. Education, housing
and a host of other factors make it
difficult to recruit and retain great talent
here. Shouldn’t you do everything you
can to insure your organization has a
robust supply of great talent for years to
come? If talent isn’t your competitive
advantage, then it’s someone else’s.

3. ATG is the source for talent solutions.
ATG is a practice of business psychologists
focused on strengthening leadership in
organizations. By applying the science
of talent assessment and psychology
we’ve helped organizations lower
unwanted turnover, distinguish ‘great’
leaders from ‘good’ leaders, and develop
talent practices that deliver
tremendous financial results.

SO, HOW MUCH TIME ARE YOU
SPENDING ON TALENT ISSUES?
1. Do you have the quality talent you
need to win?

2. Do you have the pipeline of future
leaders to grow?

3. Are you sure that your “A-Players”
would never think of leaving you?

BOTTOM LINE:
Great CEOs spend over half of their
time on talent issues. They know great
talent is the top priority and isn’t easy to
build and sustain.

At ATG we spend 100% of our time
on talent. It’s your job, but it’s our
obsession. So, let ATG show you how we can
help you lift your talent to drive great
results.

R. Chris Steilberg, Ph.D. is vice president of Talent
Management at ATG, a business consulting
firm specializing in leadership
development. He is also an adjunct professor
at the University of Miami where
he teaches courses on talent management
and it impacts business results. He can be
reached at Chris@assessment-tech.com.

1How top companies breed stars, Fortune 2007

Aiming to Put the Right People in Charge

New online tools will help prospective assigning editors see whether they have what it takes to succeed.

What makes a good assigning editor? Knight Ridder has offered more than 20 seminars for assigning editors during the past seven years and, at the start of each class, we ask every participant: "Who is the best assigning editor you've ever known, and why?" They always cite the same qualities, using many of the same words: She trusted me. She pushed me. She believed in me. ... He was patient. He cared about me. He helped me. ... A great coach. Set clear goals. Could see the story. ... Demanding. Generous with her time. ... Energetic. Passionate. Confident. But in almost every group of editors, someone stands and says, "I've never known a good assigning editor."

I always want to apologize for that. We should be ashamed of how many assigning editors are not good enough-not good enough to help our reporters do better work, not good enough to grow readership. It's a tough job, getting tougher all the time. Every problem seems to land on the desk of the assigning editor. Yet doing the job well is critical to the success of the newspaper. Those of us involved in the Frontline Editors Project want to increase the odds of success. Our goal is two-fold:

1. We can help prospective assigning editors determine whether they are well suited for the job.
2. We can help assigning editors identify their most critical developmental needs.

Exploring the Job's Fit

Through the Poynter Institute's News University, which offers online training, journalists will be able to learn more about the frontline editor's job and whether it would be a good fit for them.

To give a realistic preview of the job, working assigning editors have been videotaped talking about the good, the bad, and the ugly parts of the work, telling what surprised them most, sharing their passions, and warning about pitfalls. We also plan to provide samples of raw copy and offer case studies on management and editing issues. For those who want to take the next step, we will tell how to go about shadowing an assigning editor in their newsroom and how to apply for cross-training in that job.

Originally, we planned to provide a self-assessment questionnaire, specifying desirable traits for this job, with questions such as, "Do I like giving honest feedback?" "Am I a good teacher?" "Well organized?" "A problem solver?" Can I juggle several tasks at once?" "Do I meet deadlines?" "Am I comfortable with tension and conflict?"

Then we wondered if job fit could be even more accurately predicted. Psychologists say there is a scientific way to predict success. If we are able to accurately describe an assigning editor's critical tasks, attributes and competencies, a sophisticated software program will be able to tell an individual just how good the fit will be.

In October, we asked Dr. Leslie Krieger, a consulting psychologist and president of Assessment Technologies Group, to meet with about a dozen assigning editors to start to develop such an interactive "job fit" tool. The group spent hours analyzing and describing how they do their job, and this information was digested by a computer. Its software then produced the first draft of our instrument.

Krieger said that in 30 years of research he had never encountered a job with such intense problem-solving demands. The assigning editors were not surprised to hear this. Based on their input, the report generated by the computer listed three essential attributes for the job (all involved problem-solving), seven important ones ("detail-conscious," for example) and 16 that are also relevant ("tough-minded" and "conscientious" are just two of these). Each attribute was scored from 1 to 10, and a shaded area marked on the scale where the ideal candidate would score.

Of course, that session was just the start of a process to create a credible instrument. Additional sessions in Atlanta, Kansas City, and San Jose will repeat the exercise of defining the job, to vet the instrument and gain new insights. Our target is to offer this "job fit" tool to all journalists by fall 2006. Once it's available online, prospective editors will be able to respond to a series of questions and receive a confidential report showing how they scored on these essential, important and relevant attribute scales and see how their scores compare with those of the ideal candidate.

Obviously, there is no such thing as an ideal candidate. But the right "job fit" tool could help journalists see how well suited they are for this demanding job. By showing how their strengths differ from those of the ideal candidate, it will help them identify developmental needs. It could also help the industry determine training priorities.

Having such a tool could avoid the harm done by having the wrong person in the assigning editor's job or having an assigning editor who doesn't clearly understand the demands of the job and the consequences of performing poorly in it. And it could decrease the chances that an experienced journalist would ever say, "I've never known a good assigning editor."

Marty Claus, a former vice president/news for Knight Ridder, was an assigning editor for more than 12 years at the San Bernardino (Calif.) Sun-Telegram and the Detroit Free Press. She is now a consultant, specializing in recruiting and training.

By Marty Claus