More than MBAs

Companies are relying more on their own execs, and less on B-school professors, to teach up-and-coming leaders. Here's why.

At Dell Inc., Michael Dell (Chairman of the Board), and Kevin Rollins (President and CEO) both teach for several days in the top-level high-potential leadership-development program, and "leaders teaching leaders" is the predominant method of delivery of Dell’s leadership programs. Steve Reinemund, Chairman and CEO of PepsiCo, is present during the entire week of Pepsi's senior high-potential program and teaches throughout. At UBS, The Group Executive Board (top 10 executives) mentor the next 60 executives below them (the Group Management Board or GMB), and the GMB mentor the next level below them. Both the GEB and the GMB actively, and eagerly, teach in UBS’s top-level leadership-development programs.

What’s going on here? Aren’t university academic faculty supposed to be entrusted with the traditional role of teaching our corporate leaders?

Through our survey of trends in executive/leadership development conducted two years ago with heads of learning and executive-development departments, we found that the learning method they would use the most would center on their own executives. Since we began conducting the survey in 1983, this was the first time this method of learning was rated at the top. Late last year we checked again to see how things had changed and we found that 95% said that leader-led learning (using their own executives to teach) had either increased in importance (43%) or stayed the same.

In my previous two columns, we examined the learning method ranked second (action learning) and third (executive coaching), so now let’s take a look at the phenomena of leader-led learning.

First of all, why would companies be relying more and more on their own executives to teach their leaders rather than traditional academic faculty? There may be many reasons, but I believe the most compelling one is that the very nature of executive leadership development has changed dramatically. In the past, the typical company executive leadership development program tended to include a mini-MBA type curriculum with a little bit of marketing, human resources, finance, operations, etc. Companies tended to mimic the university MBA curriculum but conduct it in-house in short versions for two weeks or so. And naturally, they tended to use university faculty to do the bulk of the teaching. These programs were generally designed to round off the edges of high-potential leaders who had been siloed in a narrow function of the business. The programs were meant to broaden their perspectives, and to prepare them for more senior-level responsibilities.

But times have changed. Companies now use these programs much more strategically. They identify the specific capabilities needed to address their organization’s marketplace challenges and to execute their strategies, then custom-design programs to build those capabilities. Since the programs are about their unique challenges, strategies, and capabilities (and therefore, often their vision, mission, values, strategy, and culture), it makes a lot more sense for their own executives to be teaching much of the program rather than outsiders.

So if this shift in the very nature of executive leadership development is the general impetus driving senior executives into the classroom, what is it they are actually doing there? Here are just a few examples:

  • Kicking off the program or closing it. This is a traditional role of the CEO. In the past, it was often a cameo appearance limited to brief remarks about the state of the business and the overall importance of the program and participants to the organization. Now it is more likely to take several hours and include deep dialogue on the vision, values, marketplace challenges, strategies, and strategic priorities. Sometimes it also covers what is expected of an executive at the next level up, i.e., what are the roles, responsibilities, and expectations of the senior executive in that organization. Of course, sessions that deal with strategic matters can also be taught by other top executives besides the CEO.
  • Co-teaching with outside faculty. There are some topics like finance where it seems to work well to have an outside expert, often from a university, teach key financial concepts and also have the CFO from the company teach the company-specific financial analysis tools, methods that tbeir leaders need to know.
  • Leadership stories. Many organizations now use executives in a storytelling format. For instance, many find it works well to have evening sessions in a "fireside chat" style where groups of four or five, including one senior executive, each develop and then tell their personal stories about the people and events that have shaped their beliefs and values, and how that has affected their leadership. In another version of this, one of our clients is using senior executives as coaches to observe teams that are analyzing traditional business cases and to gently guide the teams to demonstrate the types of analytical thinking that take place at the executive level. Then the executives tell a story about an actual dilemma they faced and how they dealt with it including the lessons learned.
  • New business processes. It is now common that executives teach new ways of doing business to the levels below them rather than outside consultants or faculty from universities.
  • Best and innovative practices. Participants in programs these days seem to be eager to hear from successful executives about what works and doesn’t work rather than academic theory. What are the best practices? What works really well? What should be avoided? What are the innovative things being done across the organization?

This sounds great, doesn’t it? So what could possibly go wrong? Well, many senior executives are not good teachers by nature so they have to be trained and coached, and then they still might not be good. Another common problem is they might not show up—you know, they’re kind of busy. So you better have a back-up plan. Finally, remember that like all good ideas, this will become a fad. Carried to its extreme (there are already executive development programs taught totally by the organizations own executives, i.e., no outside faculty), it could contribute to becoming insular and arrogant, especially at companies that are really successful and are starting to think they know it all — I mean really, who could we possibly benchmark ourselves against?

Hmmm, where will the fresh ideas and perspectives come from?

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