Great Leaders: Bought, Made or Neither?

The leadership selection and performance relationship isn’t concrete.

As learning professionals, we earn our living by providing services to develop workforce talent. While creating learning interventions, we often conduct a “make or buy” analysis to determine whether the organization’s money is better spent using internal or external resources to provide the learning intervention.

In talent management, we engage in the same decision-making process about human capability. Do we develop our current talent to meet organizational needs, or do we buy it? The stakes are even higher when the talent is in a leadership role.

Therefore, we must look at how we select our leaders before we even think of developing them.

Throughout my organizational development career, I have spent significant portions of my annual budget developing managers in rather low-level management skills such as meeting facilitation, team building and performance management. Few resources are left over for more sophisticated role development in managing across boundaries, business development and strategic innovation. More than once, I’ve wondered how we can better select our leaders in the first place rather than continually developing from basics.

There is ample literature that finds leadership skills correlates to high performance. I designed a research study to evaluate the relationship between a skill-based leadership selection assessment tool and leadership performance outcomes — both subjective and objective measures — for established managers. My hypothesis was that high-performing managers would be consistently rated more highly than lesser performing leaders and produce stronger business outcomes. I tested relationships between 10 leadership skills (health care leadership inventory) and supervisor rating and operational outcomes metrics (financial/satisfaction/quality).

Surprisingly, I found no relationship between a manager’s skill level as measured by the selection tool with the annual performance review and business outcomes. Of the 10 leadership skills in the research participants, who were nurse managers, two skills correlated to the supervisor rating of high performers. My findings identified three additional skills related to leaders performing better on outcomes and customer perception — operational outcome metrics. Not one skill was related to both supervisor rating and business operational outcome metrics.

The lack of relationship between subjective and objective performance metrics and leadership skills raises three fundamental questions about our assumptions of selection skills, development strategies and appropriateness of leadership performance measures. Given the abundance of literature supporting leadership skills, the most prominent for me became leadership performance measures.

For example, what outcomes define a good leader? Many of us use leadership skill definitions to give us the language to describe differences we see in our leaders’ performance. But even within that well-researched construct, we find leaders who run the most efficient departments may lack some fundamental leadership skills.

Success may look different in different organizations or departments within the same organization. Many organizations are in industries that change rapidly. My industry, health care, is a complex adaptive system where as the environment changes rapidly, so do our expectations for leaders. Before we can apply broad skill definitions to either selection or development, we need to step back and define success.

As learning professionals, we strive to maximize workforce capability with fiscal responsibility. Sometimes, our investments are better spent on selection — buy. Sometimes, they are better spent on development — make. Sometimes, they may be better spent reconsidering how to define a great leader.

But let’s not throw away the somewhat misguided concreteness of skills. Instead, let’s use them as guiderails and language aids to align understanding our environments and definitions of leadership success. Great leadership is not just about selection and development — it’s about how we measure and define great leaders in any given department, organization and industry.