Leadership competencies across organizational levels: a test of the

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Leadership competencies across organizational levels: a test of the pipeline model

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Guangrong Dai, King Yii Tang and Kenneth P. De Meuse

Received 12 February 2010 Revised 9 May 2010 Accepted 28 July 2010

Korn/Ferry Leadership & Talent Consulting, Minneapolis, Minnesota, USA Abstract Purpose – This paper aims to test the pipeline model of leadership development by investigating how the competency profile change across position levels. Design/methodology/approach – The skill and importance ratings in leadership competencies were compared between four position levels. The data were from an archive 360 degree feedback (n ¼ 770). Six SMEs were also employed to rate the importance of the competencies. Findings – The study found that the difference between two positions in terms of the relative importance of the competencies increases as the organizational hierarchical distance between the two positions increases. Comparing the skill ratings yielded similar results. Further, the correlation between the skill and importance ratings for the same position level was higher than correlations of the two types of ratings for different position levels. Research limitations/implications – The study discusses the implications of the research findings in the context of leadership development and succession management. Practical implications – One of the essential tasks in a succession system is to clearly define critical leadership skills at different levels of management. By defining the leadership pipeline, companies will be able to get their best people the right developmental experiences to help them transition from one position level to another. Originality/value – The paper provides empirical support for the pipeline model of leadership skill requirement across the organizational hierarchy. Keywords Leadership development, Succession planning, Competences, 360-degree feedback Paper type Research paper

Journal of Management Development Vol. 30 No. 4, 2011 pp. 366-380 q Emerald Group Publishing Limited 0262-1711 DOI 10.1108/02621711111126837

Most organizations recognize the need for succession planning. Succession planning and the identification and development of top talent are essential for any organization looking to gain competitive advantage. One of the essential tasks in a succession system is to clearly define critical leadership skills at different levels of management (Pernick, 2001; Snipes, 2006). Companies with effective succession management plans will get their best people the right developmental experiences that will help them transition from one position level to another and rigorously evaluate them in the jobs they perform. In other words, succession systems must follow a thorough roadmap for leadership development and know what experiences are necessary for developing the critical leadership skills for each level of management. The leadership pipeline approach for leadership development (Charan et al., 2000; Drotter and Charan, 2001) will help organizations improve their succession systems. Leadership competencies have become widely used by organizations, and competency has become a common language when talking about leadership skills. The purpose of this study is to empirically test the pipeline model by investigating how leadership competency profile changes across management position levels.

Pipeline model of leadership development Based on work originally conducted at General Electric during the 1970s and later expanded to more than 80 companies, Charan et al. (2000) developed a six-passage model for understanding the leadership requirements throughout the various organizational levels within a company. This so-called, “Pipeline model of leadership development” defines the crucial skills for successful management transitions from the very bottom of an organization (managing oneself) to the very top (managing the enterprise). Each of the six management transitions in this model involves a major change in job requirements, demanding new skills, time applications, and work values. For instance, new and young employees usually spend their first few years in a company as individual contributors. They contribute by performing the assigned work within given time frames. The important skills are mostly functional and technically related. When promoted to first-level supervisors, they need to learn how to reallocate their time so that they can help other employees perform effectively. They must learn to value managerial work and believe that making time for others, planning, coordinating, and coaching are imperative in their new responsibility. To build effective leadership at all hierarchical levels, organizations need to identify leadership candidates early, provide them with growth assignments, give them useful feedback, and coach them (Charan et al., 2000). There is a rich tradition in the study of management that recognizes changing managerial functions across organizational levels. Based on an in-depth, structured observation study of executives, Mintzberg (1975) delineated ten essential management roles: figurehead, leader, liaison, monitor, disseminator, spokesman, entrepreneur, disturbance handler, resource allocator, and negotiator. The ten managerial roles fit into three clusters – interpersonal, informational, and decisional. Each of the roles requires a somewhat distinct set of behaviors. Although Mintzberg did not explicitly address the differences in managerial functioning by level, he did observe that the amount of time devoted to each role varies by management job function. Mintzberg’s observation reinforced the findings from other research conducted at about the same time. All these studies found that managerial performance profiles are different for different management job types and organizational levels (Penfield, 1974; Tornow and Pinto, 1976). Jacob and Jaques’ (1987, 1990) Stratified Systems Theory explicitly discussed how leadership skill requirement differ across organizational levels. This model of leadership contains three layers that reflect three functional domains. The three layers further incorporate seven strata. The lowest functional domain is the production or command domain. Leadership at this level is characterized as involving direct and small-group interaction, and tasks are fairly concrete and accomplished. The next functional domain is the organizational domain. Leaders at this level coordinate and integrate the activities of multiple subsystems in the organization. At the top is the strategic domain. The work at this level involves the development and nurturance of new business units and the formation of national and international networks. Jacobs and Jaques (1987) identified three broad sets of leadership skills: technical, interpersonal, and conceptual skills. It has been argued that these three layers of leadership domains from bottom to top require increasing interpersonal and conceptual skills but less technical skills.

Leadership competencies

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There are leadership transition points in the course of a management career. Each transition requires people to acquire new ways of managing, learning to leave the old ways behind. Brousseau et al. (2006) found that managers’ decision-making styles evolve during one’s managerial career. Driver et al. (1998) defined broadly four decision-making styles: (1) Decisive. (2) Flexible. (3) Hierarchic. (4) Integrative. Based on the analysis of the decision profiles of more than 120,000 managers and executives, Brousseau et al. (2006) found that as an individual progresses from first-line supervisor to manager to director to vice president to senior executive, his or her approach to decision making evolves along a predictable path. They observed that the decision-making profiles do a complete flip over the course of a management career. The predominant style for low-level managers is decisive; a flexible decision style is the least used at this position level. In contrast, a flexible decision style becomes predominant for higher levels of managers (e.g. vice presidents and senior executives), while a decisive style is least used. These authors conclude that for a leader to succeed, behaviors and styles must evolve over the course of a career. Ascending the career ladder requires the acquisition of leadership skills. Brousseau et al. (2006) contrasted the profiles of performers in the top 20 percent with others and found the most successful managers reach and pass the transition point earlier in their career. In addition, the least successful managers (the bottom 20 percent of performers) started their career pretty much like the others but did not make the transition successfully. Kaiser and Craig (2004) investigated how effective leadership behaviors differ across management levels using a sample of 2,000 managers from three positions – supervisor, middle manager, and executive. In their study, they predicted supervisor ratings of overall effectiveness from subordinates’ ratings on seven behavioral dimensions. The results indicate that success formula varied across levels. For example, “interpersonal warmth” was negatively correlated with a supervisor’s job performance, but was positively correlated for middle managers. In contrast, “decisive, action orientation” and “work-life balance” was positively correlated with job performance for supervisors and middle managers, but negatively correlated with job performance for executives. To climb the organizational hierarchy, managers need to seek out new knowledge and develop new skills while at the same time abandon some approaches that used to work but no longer are effective. What happens if managers stop learning and do not make the transition? It appears that many managers rely on what have got them to where they are. They perceive that they are infallible. They quit learning. They refuse to make the transition to a different job or way of behaving. These managers derail (Lombardo and Eichinger, 1989a; Lombardo et al., 1988; McCall and Lombardo, 1983). Conger and Fulmer (2003) describe some senior executives who have been given the top job largely as a reward for their functional skills. Ultimately, these managers failed on their job. The strengths that used to work became weaknesses when they relied too heavily on them or applied them where they did not belong (Farson and Crichton, 1996). Ludeman and Erlandson (2006)

coined the term, “alpha male syndrome”, to describe those managers who use their strengths to the extent that the strengths turn into tragic flaws. Mumford et al. (2000) found that certain types of leaders are more likely than other types to learn new skills to move into senior positions. In summary, leadership development appears to follow a roadmap. The Pipeline Model of succession management helps organizations move people through leadership passages at the appropriate speed, developing managers in the right places with the right experiences. A well-defined leadership pipeline delivers important benefits (Drotter and Charan, 2001). While the theory is appealing and evidence from anecdotal case studies is convincing, the Pipeline Model has not been well tested empirically using a large database. We located only a few empirical studies in the literature (Kaiser and Craig, 2004; Mumford et al., 2007). Kaiser and Craig (2004) study did not examine a wide spectrum of leadership skills. For example, strategy and technical skills were not included in their study. Observation suggests that strategic skills are critical for higher-level positions; whereas, technical skills are more important for lower levels. The missing of some important leadership skill areas poses a severe limitation in their study. Mumford et al. (2007) investigated how perceived skill requirements on broadly four categories: cognitive, interpersonal, business, and strategic, vary across organizational levels. However, their study did not examine how individuals’ actual skill level in the four categories changes along the management career ladder. Most importantly, no study that examined the evolvement of leadership competency profiles across organizational levels of management was located. A survey of competency-based practices revealed that between 75 and 80 percent of companies have some competency-driven applications currently in place (Schippmann et al., 2000). Millions of managers have experienced competency-based developmental 360-degree feedback during the past decade. Many companies design and implement leadership development in terms of competencies. It would seem essential that organizations specify the leadership competencies required as individuals ascend the various levels of management (Snipes, 2006). In the present study we tested the Pipeline Model or stratified leadership requirement perspective using a 360-degree feedback instrument that assessed a host of 67 competencies (Lombardo and Eichinger, 2004). The 67 competencies thoroughly covered the entire managerial performance domain, measuring such skills as strategy, decision, functional, technical, operational, organizing, confronting, communicating, motivating, delegating, and developing. Hence, the current study was able to investigate how critical leadership skills transition across position levels without missing important performance domains. The data were collected from multiple companies. Individuals were rated on two scales – importance and skill. The “importance rating scale” evaluates how important the competencies are for an individual’s job. The “skill rating scale” assesses how skillful an individual is on the competencies. In addition to the 360-degree feedback data six subject matter experts were recruited to rate the importance of the competencies across different position levels. In the following section, we discuss how the importance ratings and skill ratings will be reflected in the pipeline model.


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300-degree competency importance ratings Competencies are rated in terms of importance for effective job performance across different organizational levels. The relative importance of the competencies can be determined by ranking the competencies on the importance ratings. The pipeline or stratified perspective suggests that this rank order will be different across the position levels. For example, strategic skills may be critical for an executive’s job performance but less important for an individual contributor or a first-level manager. As individuals move up the career ladder, they do less functional work, but an increasing amount of planning, motivating, organizing, and coordinating. This transition implies that the difference in importance ratings will be small between adjacent positions and enlarged as one increases the distance between two organizational levels. Hence, we predict the following: H1. The correlation of 360-degree competency importance ratings for two position levels will decrease as the distance between the two positions increases. 300-degree competency skill ratings It seems reasonable that skill ratings should be highly related to importance ratings, because individuals should be more skillful on competencies that are important for the job. Two reasons lead to such a positive relationship. First, people are usually selected based on the competencies considered important for a job. Person-job fit is the traditional foundation for employee selection (Werbel and DeMarie, 2005). Second, people will be able to further develop these important competencies, due to the fact that there will be more opportunities to practice these competencies while performing the job. Experience is the best teacher (Lombardo and Eichinger, 2004). Mumford et al. (2000) discussed the learning on the job in terms of self-propagating pattern of situational choice, believing that individuals acquire the knowledge and skills needed for effective performance within certain roles or classes of situations. Thus, person-job fit is the outcome of selection as well as on-the-job training. Based on their study, Mumford et al. (2000) believed the second reason is more likely to lead to the congruency between skill level and skill requirement. If skill levels on different leadership competencies reflect the relative importance of these competencies across various positions, we would expect the same pattern of correlations among the skill ratings for different positions. H2. The correlation of 360-degree competency skill ratings for two position levels will decrease as the distance between two positions increases. If we investigate the relationship between skill ratings and importance ratings, we would expect that the correlations would be higher for the same positions than for different positions. It seems likely that skill ratings for a specific position will have a relatively lower correlation with the importance rating for a different position. Therefore, we hypothesize the following: H3. 360-degree skill ratings for a position will have a relatively higher correlation with 360-degree importance ratings for the same position. The correlations will decrease as the distance between the positions increases.

Subject-matter expert importance ratings Six subject-matter experts (SMEs) were asked to rate the importance of the 67 leadership competencies for different organizational level positions. The addition of the experts’ ratings has several practical implications. Executive coaches provide consulting and coaching services based on their understanding of the managerial roles. If executive coaches can identify what is important for different position levels of management, it would suggest that they understand the dynamics of the Pipeline Model. If not, it would suggest that such experts have a simplistic view of the need for different competencies in managerial transitions. In the current study, we compare SMEs’ importance ratings with the 360-degree importance ratings in order to investigate the agreement. Using the Multi-Trait-Multi-Method (MTMM) approach (Campbell and Fiske, 1959), we hypothesize the following: H4. There will be relatively higher correlations between SMEs’ and 360-degree importance ratings for the same position levels, and relatively lower correlations between the two sources of importance rating for different position levels. With regard to how the SMEs’ importance ratings for different position levels are related to each other, we hypothesize: H5. The correlation of SMEs’ importance ratings for two position levels will decrease as the distance between the two positions increases. Likewise, if we examine the 360-degree skill ratings with SMEs’ importance rating, we would expect the same pattern of relationships as we predicted between 360-degree skill ratings and 360-degree importance ratings. H6. The 360-degree skill ratings for a position will have a relatively higher correlation with the SMEs importance ratings for the same position. The correlation will decrease as the distance between the positions increases. Method Sample A database of responses to a commercial 360-degree leadership competency feedback instrument was used for this study. A total of 770 employed individuals and 3,720 raters from 13 different companies in North America participated. Only “all other” ratings were used (i.e. ratings from peers, the boss, and direct reports), because research has found that self-ratings are less accurate compared to the ratings from others (Eichinger and Lombardo, 2004). The majority of the participants were male (61.8 percent). The average age was 43; the average years of managerial experience was 12.69 (SD ¼ 7:59). The distribution of position levels was as follows: . 9.5 percent individual contributors; . 31.9 percent supervisors; . 32.1 percent middle managers; and . 26.5 percent executives. Most participants had college education or higher (87.6 percent).


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The 360-degree feedback instrument The 360-degree feedback instrument consisted of 67 items designed to assess 67 leadership competencies. The theoretical foundation and research on the development of this instrument are summarized in Lombardo and Eichinger (2003, 2004). Each of the managerial leadership competencies was rated on a five-point scale to assess how skillful the participant was (1 ¼ a serious issue, 2 ¼ a weakness, 3 ¼ useful/nice to have, 4 ¼ skilled/ok, 5 ¼ talented). Behavioral descriptions of skilled and unskilled situations were provided to raters to facilitate the ratings. According to Lombardo and Eichinger (2003), average test-retest reliability was 0.82 for all others’ ratings. In addition, each of the leadership competencies was rated on a five-point scale to assess how important it was for an individual’s job (1 ¼ not important, 2 ¼ less important, 3 ¼ useful/nice to have, 4 ¼ very important, 5 ¼ mission critical). SMEs importance ratings Six subject matter experts were asked to rate the importance of the 67 competencies for four position levels. These subject matter experts were executive coaches who had extensive experience using the 360-degree leadership competency feedback instrument. The importance was rated on the same scale as used in the 360-degree feedback. The average inter-rater correlations for the four position levels were 0.66, 0.46, 0.44, and 0.52, sufficiently high to justify aggregation across the six SMEs (Van Velsor and Leslie, 1991). Results Tables I and II depict the correlations for the 67 competencies among four position levels on importance ratings and skill ratings, respectively. With regard to importance ratings, individual contributors had a relatively higher correlation with supervisors (r ¼ 0:82) than with middle managers (r ¼ 0:69) and executives (r ¼ 0:75). Further, executives had a relatively higher correlation with middle managers (r ¼ 0:96) than

Table I. Inter-position correlations for 3608 importance ratings

Table II. Inter-position correlations for 360-degree skill ratings

Individual contributors Supervisors Middle managers Executives

Individual contributors

Supervisors

Middle managers

Executives

– 0.82 0.69 0.75

– 0.96 0.92

– 0.96

–

Note: All correlations were significant at p , 0.001 level

Individual contributors Supervisors Middle managers Executives


Supervisors

Middle managers

Executives

– 0.93 0.86 0.85

– 0.94 0.88

– 0.95

–


with supervisors (r ¼ 0:92) and individual contributors (r ¼ 0:75). The same pattern was observed for middle managers. Middle managers had relatively higher correlation with supervisors (r ¼ 0:96) and executives (r ¼ 0:96) than with individual contributors (r ¼ 0:69). The lone exception was for supervisors. Supervisors had a relatively higher correlation with executives (r ¼ 0:92) than with individual contributors (r ¼ 0:82). Thus, H1 was generally supported. Likewise, H2, which focused on skill ratings was largely supported (see Table II). Individual contributors had a relatively higher correlation with supervisor (r ¼ 0:93) than with middle managers (r ¼ 0:86) and executives (r ¼ 0:85). Executives had a relatively higher correlation with middle managers (r ¼ 0:95) than with supervisors (r ¼ 0:88) and individual contributors (r ¼ 0:85). Further, middle managers had a relatively higher correlation with executives (r ¼ 0:95) and supervisors (r ¼ 0:94) than with individual contributors (r ¼ 0:86). Finally, supervisors had a relatively higher correlation with middle managers (r ¼ 0:94) and individual contributors (r ¼ 0:93) than with executives (r ¼ 0:88). Table III presents the intercorrelations between 360-degree skill and importance ratings. The numbers in diagonal were correlations between 360-degree skill ratings and 360-degree importance ratings for the same positions. Each of the correlations in diagonal would be compared with other six correlations in the row and column that intersect. As hypothesized, individual contributor skill ratings had a relatively higher correlation with the importance ratings for individual contributors (r ¼ 0:66) than for supervisors (r ¼ 0:49), middle managers (r ¼ 0:37), and executives (r ¼ 0:42). Similarly, individual contributor importance rating had a relatively higher correlation with skill ratings for individual contributors (r ¼ 0:66) than for supervisor (r ¼ 0:52), middle managers (r ¼ 0:56) and executives (r ¼ 0:55). Executive skill ratings had a relatively higher correlation with the importance ratings for executives (r ¼ 0:58) than for middle managers (r ¼ 0:49), supervisors (r ¼ 0:50), and individual contributors (r ¼ 0:55). Similarly, executive importance ratings had a relatively higher correlation with skill ratings for executives (r ¼ 0:58) than for middle managers (r ¼ 0:55), supervisors (r ¼ 0:36), and individual contributors (r ¼ 0:42). On the other hand, supervisor skill ratings had a relatively higher correlation with the importance ratings for supervisors (r ¼ 0:44) than for middle managers (r ¼ 0:34) and executives (r ¼ 0:36), but not for individual contributors (r ¼ 0:52). The correlations between middle manager skill ratings and importance ratings for all the four position levels were virtually the same. Among the 24 comparisons, 17 were in the right direction (70.8 percent). Overall, the results tend to support H3.

Skill ratings Individual contributors Supervisors Middle managers Executives

Individual contributors 0.66 0.52 0.56 0.55

Importance ratings Supervisors Middle managers 0.49 0.44 0.56 0.50


0.37 0.34 0.54 0.49


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Executives 0.42 0.36 0.55 0.58

Table III. Correlations between 360-degree skill and importance ratings

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Table IV. Correlations between 360-degree and SMEs’ importance ratings

Table V. Inter-position correlations for SMEs’ importance rating

The multi-trait (importance rating for four positions) multi-method (360-degree and SMEs) approach was used to test H4 (see Table IV). Numbers in the diagonal are correlations between the two methods for the four organizational positions. These numbers were compared with off-diagonal numbers. Of the 24 comparisons, 21 were in the predicted direction (87.5 percent). For example, SMEs ratings for individual contributors had a relatively higher correlation with 360-degree importance ratings for individual contributors (r ¼ 0:62) than for supervisors (r ¼ 0:30), managers (r ¼ 0:13), and executives (r ¼ 0:21). Similarly, 360-degree importance ratings for individual contributors had a relatively higher correlation with SMEs ratings for individual contributors (r ¼ 0:62) than for supervisors (r ¼ 0:45), managers (r ¼ 0:45), and executives (r ¼ 0:36). There were only a few exceptions. For example, SMEs’ importance ratings for middle managers was equally correlated with 360-degree importance ratings for middle managers (r ¼ 0:71) and executives (r ¼ 0:71). Overall, H4 was largely supported. Table V illustrates the inter-position correlations for the SMEs’ importance ratings. Individual contributors had a relatively higher correlation with supervisors (r ¼ 0:39) than with middle managers (r ¼ 0:05) and executives (r ¼ 0:02). Executives also had a relatively higher correlation with middle managers (r ¼ 0:75) than with supervisors (r ¼ 0:05) and individual contributors (r ¼ 0:02). Likewise, middle managers had a relatively higher correlation with executives (r ¼ 0:75) and supervisors (r ¼ 0:53) than with individual contributors (r ¼ 0:05). Finally, supervisors had a relatively higher correlation with middle managers (r ¼ 0:53) and individual contributors (r ¼ 0:39) than with executives (r ¼ 0:05). Therefore, H5 was strongly supported. The correlations between 360-degree skill ratings and SMEs importance ratings are presented in Table VI. Again, the numbers in diagonal are correlations for the same position levels. These correlations were compared with the other correlations in the rows and columns that intersect. Although over half of the comparisons (62.5 percent)

3608 individual contributors 3608 supervisors 3608 managers 3608 executives

SME individual contributors

SME supervisors

SME managers

SME executives

0.62 * * 0.30 * 0.13 0.21

0.45 * * 0.60 * * 0.51 * * 0.42 * *

0.45 * * 0.64 * * 0.71 * * 0.71 * *

0.36 * * 0.43 * * 0.53 * * 0.62 * *

Notes: *p , 0.05, * *p , 0.01


Supervisors

Middle managers

Executives

– 0.39 * * 0.05 0.02

– 0.53 * * 0.05

– 0.75 * *

–

Individual contributors Supervisors Middle managers Executives Notes: *p , 0.05, * *p , 0.01

were in the expected direction, only the individual contributor skill ratings had the highest correlation with individual contributor importance ratings (r ¼ 0:74). Thus, H6 was not strongly supported. Discussion This study tested the pipeline model or stratified perspective of managerial transition by examining how the leadership competencies required for organizational position levels are different. We hypothesized that the competency profile will be increasingly different as one moves from lower level positions up the career ladder. Overall, the pipeline model was supported. The data clearly show that skill and importance differences increase as the distance between two positions increases. The findings suggest that as people move to different position levels in an organization, the requirement for successful job performance changes. Managers must learn new skills to be effective in new positions. Organizations are increasingly using executive coaches in developing their managers (Sherman and Freas, 2004). To help managers develop their leadership skills, executive coaches must guide the managers’ developmental efforts in the right direction (Stern, 2004; Wasylyshyn, 2003). Consequently, understanding the job requirements for various management positions is a critical skill executive coaches need to possess. In the current study, the SMEs’ importance ratings were highly correlated with the 360-degree importance ratings (rs . 0.60). Remember: the 360-degree feedback data were from more than 700 individuals rated by more than 3,720 raters. The high correlations suggest that executive coaches are generally able to determine what is required for various management positions. Further, if we compare the two sets of inter-position importance rating correlations from two sources, 360-degree and SME, we found that the correlations were much smaller for SMEs ratings than for the 360-degree ratings. For example, the correlation coefficient between supervisor and manager was 0.53 for the SMEs’ ratings and 0.96 for the 360-degree ratings. This finding suggests that SMEs can differentiate the various positions better than the 360-degree raters. Executive coaches likely have many more opportunities than others to test their knowledge by comparing successful managers with unsuccessful ones. One finding from this study is particularly noteworthy. The importance rating correlations between two adjacent positions were the lowest for individual contributor-supervisor. For example, the correlation coefficient between the two positions for 360-degree importance ratings was 0.82; whereas, coefficients for the other two pairs – supervisor-manager and manager-executive – were 0.96 and 0.96,

3608 skill ratings Individual contributors Supervisors Managers Executives

Individual contributors 0.74 * * 0.60 * * 0.50 * * 0.50 * *

Notes: *p , 0.05, * *p , 0.01, * * *p , 0.10

SMEs importance ratings Supervisors Middle managers 0.40 * * 0.35 * * 0.38 * * 0.28 *

0.08 0.03 0.23 * * * 0.26 *


375

Executives 2 0.04 2 0.10 0.10 0.21 * * *

Table VI. Correlations between 360-degree skill ratings and SMEs’ importance ratings

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respectively. Similarly, the correlation coefficient between the two positions for SMEs’ importance ratings was 0.39, while the correlations for the other two pairs – supervisor-manager and manager-executive – were 0.53 and 0.75, respectively. The lower correlation implies larger differences in competency profiles for the two positions. This suggests that the largest transition happens at the early stage of the career ladder. This result is consistent with Brousseau et al. (2006). Brousseau and his colleagues plotted the decision styles for various position levels. They found a “convergence zone” after which the decision style profiles do a complete flip. This convergence is located at the early stage in the career ladder. Faced with the impending leadership shortage in the future, organizations should ask for what they can do to enhance their leadership development program. The findings of this study suggest that organizations can only accelerate the leadership development to a certain degree. Leadership development follows a roadmap. Skipping the sequence of managerial transition may have detrimental effects. In the Harvard Business Review article titled: “The young and the clueless”, Bunker et al. (2002) described an increasingly common phenomenon in the workplace. They observed that most executives seek out smart, aggressive people, paying more attention to their accomplishments than to other critical competencies, such as people skills and emotional maturity. Executives have their reason to do so. In the war for talent, “if they (high performers) don’t get the job they want at one company, they’re bound to get it somewhere else. Why risk losing them to a competitor by delaying a promotion?” (p. 82). Yet, quick promoting “A” performers may actually risk their careers. Research found that up to 50 percent of senior level managers derail or plateau at some point (Hogan et al., n.d.), due to key skill deficit such as inability to build a team or regulate their own emotions in times of stress. It is one thing to understand the importance of engaging and retaining high talents; it is another matter entirely to develop a full range of leadership competencies to ensure their success in the future. A failed executive imposes more cost to a company than the leaving of a so called “A” performer. Knowing how people develop certainly will help organizations in designing their succession system and leadership development pipeline (Drotter and Charan, 2001). By identifying the crucial leadership competencies for different position levels and matching these competencies with the right developmental experiences, organizations can reduce the time needed to prepare an individual for various management positions, because there is little or no wasted effort on jobs that merely duplicates skills. Managers learn most from job experiences (Day, 2001; McCall et al., 1988). However, organizations are facing increasingly challenge in developing the full range of leadership competencies through traditional ladder-climbing type of career experience. Throughout the world, organizations are flattening, eliminating the hierarchical layers. In 1980s, the average age of top executives in Fortune 100 companies was 56, and it took them about 28.4 years and on average 5.8 jobs to ascend from their first positions to the top in their organizations. By contrast, the average age of top executives in Fortune 100 companies in 2001 was 52, and they spent 24.1 years and performed 5.0 jobs to get to the top from the bottom (Cappelli and Hamori, 2005). There is less time and fewer jobs organizations can offer to develop their leaders.

Recognizing the importance to follow the roadmap of leadership development, organizations need to be creative in developing their leaders when fewer traditional hierarchical jobs are available. Developmental job assignments do not have to be formal and hierarchical. It can be done without moving people into new jobs. For example, Lombardo and Eichinger (1989b) articulated 88 developmental experiences (such as run a task force, work short periods in other units, make speeches for organization, etc.) that can be added to the existing jobs. They further mapped the competencies to the most likely development experiences, so organizations can selectively assign managers to the right experiences to develop the right competencies. As another example, Oddou et al. (2000) suggested that organizations can use the short-term internal travel to develop some of the global leadership skills without formally relocate the managers overseas. As discussed earlier, the largest skill transition happens in the early stage of the management career ladder. The direct implication of this finding is that organizations should develop their leaders early. As pointed out by Charan (2005), “the window in which to spot CEO talent is narrow. Companies require sufficiently seasoned candidates who can be counted on to hold the top job for ten years or more. That puts the age of accession between 46 and 52”. In his experience, “for a candidate to be ready by 46, serious development should start by age 30” (p. 75). This requires organizations to be able to assess and identify their high potentials early. That is not to say that companies should not invest in all the employees. But certainly some have more potential than others for future leadership positions. Organizations therefore should focus their leadership development efforts on those high potentials. Assessment and identification of high potentials represents one of the key components of best in class leadership development (Hewitt Associates, 2005). Based on series of lessons of experience and executive derailment studies conducted at the Center for Creative Leadership, Lombardo and Eichinger (2000) proposed that the ability to learn from experience is what differentiates high potentials from average others. Spreitzer et al. (1997) also demonstrated the learning agility as the early indicator of international executive potential. Taking together, effective leadership development efforts require organizations assess and identify high potential accurately, start the development early, and assign them the right experiences to develop the right competencies at the right time. There are several limitations of the present study that should be taken into consideration. An obvious limitation is that the changes of skill requirements from positions to positions were not specified. The primary purpose of the current study is to test the overall trend of management transition by comparing the competency profiles. This represents a conceptual level validation of the pipeline model of leadership development. It would be advantageous for future research to examine the specifics of the skill transition. A second limitation concerns with the sample of organizations. Only organizations based in the North America were included in the study; therefore, these results may not be generalized across cultures. In addition, the study did not code the characteristics of organizations (such as size, industry, private vs public, and profit vs non-profit). The skill necessities, might be influenced, by the type of organizations. Finally, this study is cross-sectional. Since vertical leadership development is about the transition of individuals from one position level to another, future research should employ longitudinal designs.


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