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Developing Good Leaders: Nature or Nurture?

Deloitte Debates

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Can good leaders be developed? Or are they just born that way?

Many organizations these days devote considerable resources to developing their leaders. But does it really make a difference? Some say good leaders are born, not made, making any time and money spent on leadership development virtually useless. Others swear by it. So which is it?

Here’s the debate.

	Point	Counterpoint
Good leaders are born Leadership development isn’t worth the time or money.	I’ve never taken a leadership course, much less had a coach and people recognize me as an effective leader.	Good for you. You became a leader because you had the experiences to bring it out in you. That is the most effective way to develop. But could you have done so faster and more efficiently with the right support?
	Give me an hour with a room full of members of a work team and I’ll tell you who will be leading the group in ten years.	You may have a sixth sense for recognizing leadership capabilities. But are the characteristics you recognize today the same ones your organization will need 10 or 20 years from now? Would you bet on that?
	We’ve never made significant investments in developing our leaders and we’ve done pretty well.	Just because a hands-off approach worked in the past doesn’t mean it will work in the future. You have to cultivate leadership to be successful in the face of new challenges like dealing with uncertainty and globalization.

	Point	Counterpoint
Good leaders are nurtured. Leadership development is imperative to developing your bench.	Today’s leaders are in charge of increasingly diverse workforces operating in increasingly complex environments. Nobody’s born prepared for challenges like these. Leadership development is the best way to make sure tomorrow’s leaders are prepared.	It’s true – nobody’s born ready for the challenges the business world offers today. But do you really think development programs give them what they need? They’ll only learn through active experience – simulations are no substitute for the real thing.
	Developing tomorrow’s leaders is increasingly a numbers game – and there’s no way to guarantee you’ll have the raw number of leaders you need when you need them if you’re just hoping they accumulate the experience they need along the way. That’s where a leadership strategy and relevant leadership development come in.	Don’t tell me our future leaders aren’t tested. These days we’ve all got more than we can handle. The cream will rise to the top.
	Becoming a leader is a choice. Leadership development is all about accelerating that choice for people who may not face it otherwise.	Are tomorrow’s leaders really the types who we have to coax into becoming leaders? If so, we’re in trouble.

Our Take

Neil Neveras Rens Van Loon Neil Neveras, Senior Manager, Deloitte Consulting LLP
Rens Van Loon, Director, Deloitte Netherlands

When people tell us they don’t think an investment in leadership development is worth it, we understand. Many of them are successful people who reached their position without so much as a single training course. Some are working in organizations that have succeeded without having any formal development program in place, ever. And most have been around the block long enough to know a real leader when they see one. We get that.

But the world has changed. The old ways of doing things won’t guarantee you’ll have the leaders you need, when you need them.

Take a minute to consider your organization’s biggest goals and initiatives for the next few years. Maybe you’re expanding your labor force into global hotspots like India and China. Or planning to drive aggressive growth in global markets. And those are just the plans you know about today – what about the ones you can’t imagine yet? Is your current leadership really up to the job? If not, how will it get there?

Chances are, you need to find more leaders. That means improving the capabilities of people in your organization today and ones you’ll add later. Leadership development can provide these prospects with the diverse experiences they need to test their limits and stretch their comfort zones. That’s how leaders are made. Some people are lucky enough to have these experiences in the natural course of their careers, but great companies aren’t built on luck. At its best, a leadership strategy and development system

Creates the opportunities for current leaders to have the right experiences that will prepare them for your business’ future;
Connects those experiences to a network of peers, mentors and coaches and
Provides relevant, just-in-time opportunities for formal learning to help prepare leaders for the challenges ahead.

A view from the retail sector

Thom McElroy, Principal, Deloitte Consulting LLP
John Rooney, Principal, Deloitte Consulting LLP

As retail companies turn the corner on the recession and begin the long, slow road of recovery, they need strong leaders at the helm, both at the store level and in management. And in an industry that has seen its fair share of strong talent jumping ship for other industries, that requires a renewed focus on the talent pipeline. In retail, leaders are nurtured. But some are better than others at developing future leaders through nurturing. A key is identifying the “diamonds in the rough” that can be developed quickly.

We see a few defining—and interrelated—characteristics of leadership potential” in Retail:

Early experience. Individuals who have demonstrated some sort of “followership” or leadership role(s) in past (e.g., captain of a sports team, group leader of some organization or committee) and can show accomplishments, will be able to draw upon those previous experiences to take on new challenges.
Vision. Creating a compelling vision for others to follow is one of the most difficult areas of leadership. A strong leader should have the ability to develop a clear vision or strategy for the team in a way that is believable and motivating.
Communication. Communicating vision upward and downward is no small task. An individual may have good ideas or a strategic vision for the company, but if they can’t effectively communicate the vision up the chain or motivate the team to follow that vision, then it’s game over.
Charisma. Although some may debate it, this one is not something that can really be taught. You are either born with it or not. You can work on improving some personal characteristics, but if the candidate doesn’t have the charisma to back it up, then good luck delivering on the other three areas.

If retailers look for these qualities in their future pipeline—and then make concerted efforts to develop and test these “high potentials” through strong experiences (especially in store management and operations), they will increase their odds to beat the competition.

A view from the Financial Services sector

Ken Clinchy, Principal, Deloitte Consulting LLP

The financial services industry has traditionally led the charge on leadership development, using a “nurture” approach to help the best of the best become even better – until the recent economic meltdown, that is. In the downturn, key for most companies was trying to hold on to top talent while remaining profitable. But after a cooling-off period, leadership development is starting to heat up again.

These days, most of the financial services executives I talk to about leadership development are looking at this ramp-up period as a chance to hit the reset button – to take stock of what worked and what didn’t work in the period leading up to the meltdown and use those insights to design even more effective development programs as they get back in the swing of things.

I tell them to start by focusing on good hiring practices in order to get more from leadership development. Financial services firms have generally relied on a strategy of hiring super-talented people, relying on a mix of trial by fire and formal development programs to get them up to speed quickly. Today I’m seeing financial services firms working overtime to fill the big hole of talent left in the wake of the downturn so that they can reach cruising altitude faster. Many are paying premium prices to acquire this talent. And they need to get the most out of their investments. To do that, go to the source – the hiring process itself. Determine exactly what qualities have proven most amenable to nurturing in the past and hire accordingly. Or said another way: Look for nature, build with nurture.

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